Welingkars Distance Learning

Division

CHAPTER-11

TYPES OF ORGANISATION

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Introduction

o Organisation is designed on the basic of

principles of labour and span of
management. The success of the
organisation depends upon the experience
and competence of the officers of the
organisation. Nature, scale and size of the
business are the normal factors which
determine forms of internal organisation.
The following common types of
organisation find a place in the structure
We Learn A Continuous Learning For
of internal organisation.

Welingkars Distance Learning

Division

Introduction

o
o
o
o
o
o
o

Line, Military or scalar organisation

Functional organisation
Line and staff organisation
Committee organisation
Project organisation
Matrix organisation
Freeform organisation

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Line Organisation

o Line organisation is the simple and

oldest type of organisation followed
in an organisation. Under line
organisation, each department is
generally a complete self-contained
unit.
o A separate person will look after the
activities of the department and he

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Line Organisation

o The same level executives do not give or

receive orders amongst themselves. But they
receive orders from their immediate boss and
give orders to their subordinates. Hence, all
the heads are responsible to the general
manager, the general manager, in turn, is
responsible to the shareholders who are the
owners.

o This type of organisation is followed in the

army on the same pattern. So, it is called
WeUnder
Learn type
A Continuous
Learning For
military organisation.
of

Welingkars Distance Learning

Division

Characteristics of line
organisation

o It consists of direct vertical

relationships.
o Authority flows from top-level to
level to bottom level.
o Departmental heads are given full
freedom to control their
departments.
o Each member knows from whom he
We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Characteristics of line
organisation

o A senior member has direst

command over his subordinates.
o Operation of this system is very easy.
o Existence of direct relationship
between superiors and subordinates.
o The superior takes decisions within
the scope of his authority

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Advantages and
Disadvantages of
Advantages of line
Disadvantages of line
Line
Organisation
organisation
organisation
1. Simplicity

1. Lack of specification

2. Division of authority and

responsibility

2. Over loading

3. Unity of control

3. Lack of initiative

4. Speedy action

4. Scope for favoritism

5. Discipline

5. Dictatorial

6. Economical

6. Limited communication

7. Co-ordination

7. United administration

8. Direct communication

8. Subjective approach

9. Flexibility

9. Instability
We10.
Learn
Continuous Learning For
Lack ofAco-ordination

Welingkars Distance Learning

Division

Suitability

o This type of organisation is suitable to

small size business units.
o Where the activities are of routine
nature or machine based.
o If the business activities are service
mined.
o Where the number of persons working
is small
o The business operation is simple in
nature.
We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Functional organisation

o Under line organisation, a single

person is in charge of all the
activities of the concerned
department. The person in charge
finds it difficult to supervise all the
activities efficiently.

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Functional organisation

o The reason is that the person does not

have enough capacity and required
training. Under functional organisation,
various specialists are for various
functions performed in an organisation.
These specialists will attend to the work
which is common to different functions
of various departments. Workers, under
functional organisation, receive
instructions from We
various
specialists.
Learn A
Continuous Learning For

Welingkars Distance Learning

Division

Functional organisation

o The need for functional organisation

arises out of:
o The complexity of modern and largescale organisation
o A desire to use the specialization in
full and;
o To avoid the work-load of line
managers with complex problems
and decision-making

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Characteristics of functional
organisation

o The work is divided according to

specified functions.
o Authority is given to a specialist to
give orders and instructions in
relation to specific function.
o Functional authority has right and
power to give command throughout
the line with reference to his

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Characteristics of functional
organisation

o The decision is taken only after making consultations with

the functional authority relating to his specialized area.
o The executives and supervisors discharge the responsibility
of functional authority.
- Route clerk
- instruction card clerk
- time and cost clerk
- Gang boss
- Speed boss
- Inspector
- Repair boss
- Disciplinarian

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Advantages and
Disadvantages of Functional
Advantages of functional
Disadvantages of
Organisation
organisation
functional organisation
o Benefit of specialization
o Application of expert
knowledge
o Reducing the work load
o Efficiency
o Adequate supervision
o Relief to line executive
o Co-operation
o Economy
o Flexibility
o Mass production

Complex relationship
Discipline
Over specialization
Ineffective co-ordination
Speed of action
Centralization
Lack of responsibility
Increasing the overhead
expenses
o Poor administration
o Suitability of functional
organisation
o
o
o
o
o
o
o
o

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Line and staff organisation

o The line officers have authority to

take decisions and implement them
to achieve the objectives of the
organisation.
o The line officers may be assisted by
the staff officers while framing the
policies and plans and taking
decisions organisation.

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Line and staff organisation

o The authority flows from top level to

the lower level of the organisation
through the line officers while the staff
officers attached to the various
departments advise the departments.
The staff officers are not in a position to
compel the line officers to follow the
advice by them. Each department is
headed by a line officer who exercises
full authority regarding
planning.
We Learnthe
A Continuous
Learning For

Welingkars Distance Learning

Division

Types of staff

o Personal staff
o Specialized staff
o General staff assistant

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Functions of staff officers

o The staff officers assist the line officers in

the planning of business activity.
o The board of directors frames the policies
of the business on the basis of
recommendations given by the staff
officers.

o The managers can get the advice from the

staff officers regarding the selection.
Weand
Learnremuneration
A Continuous Learning For
training placement

Welingkars Distance Learning

Division

Functions of staff officers

o The staff officers give regarding the method

of improving the product, the technique of
reducing the cost of production, increasing
the profits of the concern.
o The staff officers prescribe the procedures to
be followed by the line officers in the
execution of policies and programs.
o Staff officers of a department help the
manager in the preparation of budget of the
department.
o the staff officers may be called to solve the
We Learn
A Continuous
administrative problems
encountered
byLearning
the For

Welingkars Distance Learning

Division

Arguments of staff officers

against line officers

o The staff officers have only theoretical

academic knowledge but not practical
knowledge.
o The staff officers go beyond their sphere
of activity and assume that they have line
officers authority.
o Much of the advice given by the staff
officers is impractical
o Since the staff officers unnecessary

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Arguments of staff officers

against line officers

o The staffs give advice without

considering the nature of business as
a whole.
o Staff officers are very much
interested in becoming line officers
of the organisation rather than
impairing advice to them.

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Solution to the conflict between

line officers and staff officers

o Both line officers and staff officers should

clearly understand the nature of relationship
prevailing between them.
o A separate staff member should be appointed
to bring about co-operation between the line
officers and staff officers.
o The line officers should be encouraged to use
the advice of staff officers.
o Only qualified persons should be selected and
placed as staff officers.

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Solution to the conflict between

line officers and staff officers

o The staff officers should be convinced by

the line officers if their advice is not
accepted
o The responsibility for results could be fixed
on both line officers and staff officers
o Only experienced persons alone should be
promoted as line executives..
o Remove the fear of the line officers and
staff officers whether the new ideas of
advice would be properly
into useLearning
or
We Learnput
A Continuous
For

Welingkars Distance Learning

Division
Advantages of line and staff
organisation

Disadvantages of line and staff

organisation

Facilitates to work faster and better

If powers are not defined then get

confusion

Specialization is attained

Line officers may reject advice

without any reason for their action

Enables to utilize experience and

advice

Staff officers are not responsible if

favorable results are not obtained.

Officers can take sound advice

Difference between line and staff

officers will defeat the very purpose of
specialization

New technology or procedure can be

introduced without any dislocation

Line officers blame staff officers for

unfavorable results and want to get
rewards for favorable results

Promotes efficient functioning of line

officers
Very good opportunity is made
available to young person to get
training

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Committee organisation

o A Committee as a group of persons either

appointed or elected who are to meet for
the purpose of considering matters
assigned it
Types of committee
o Advisory committee problem solving
committees
o Fast-finding committee

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Functions of a Committee

o Collect the necessary information from

different sources and arrange the
information orderly.
o The collected information is critically
analyzed.
o Draft a detailed report containing the
recommendations for the purpose of
implementation.
o Formulate the standard of performance for
the purpose of evolution of actual
We Learn A Continuous Learning For
performance in future.

Welingkars Distance Learning

Division
Recommendations for efficient functioning of a
committee
Preparatio
Size of the
committee

Clear
Objective

n for a
meeting

Selection of
meeting
Committe
e

Role of
chairman

Role of
committee

Selection
of subject
matter

Follow up

evolution

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Project organisation

o The project organisation idea was

developed after the second war.
o A project organisation can also be
the beginning of an organisation
cycle. The project may become a
long term or permanent effort that
eventually becomes a program or
branch organisation

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Features of project
organisation

o The Success of the project

organisation depends upon the coordination of activities

o There is a grouping of a activities for

each project. It leads to the
introduction of a new line of a
authority.
We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Drawbacks of Project
Organisation

o The professionals are deputed for the project.

But there is an assurance of continuous work
for the professional in a project organisation.
o The decision is taken in the project
organisation under pressure of the top
controls the staff in an organisation.

o The top management does not extend its full

co-operation for the We
effective
functioning of
Learn A Continuous Learning For

Welingkars Distance Learning

Division

Matrix organisation

o Any organisation that employs a

multiple command structure but also
related support mechanisms and an
associated organizational culture and
behavior pattern The matrix
organisation may be followed where
a large of small projects have to be
managed.

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Conditions for effective matrix

organisation

o The principle of chain of command is not

followed in the matrix organisation. A
project manager should give his report to
more than one superior.
o There should be an agreement among the
managers regarding the authority of
utilizing the available resources. The term
resources include physical resources,

We Learn A Continuous Learning For

Welingkars Distance Learning

Division

Merits and Demerits of

Matrix organisation

Merits of Matrix
Demerits of matrix
organization
organization
o Achievement of
o Complex relationship
o Struggle for power
objectives
o Best utilization of
o Excessive, emphasis
resources
on group decisiono Appropriate structure
making
o Flexibility
o Arising conflict
o Motivation
resolution
o Personal
o Heterogeneous
We Learn A Continuous Learning For
development

Welingkars Distance Learning

Division

Free form organisation

o This type of organisation is formed

whenever a need arises to form an
organisation, for achieving a
particular object. it will be dissolved
after achieving the object of the
organisation. The free form
organisation resembles the project
and matrix organisation. It otherwise
called organic or ratio organisation.

We Learn A Continuous Learning For