1

Organisational Structure&

HRM

• Formal & Informal Organisation• Tall & Flat Organisation structure• Responsibility , Authority and Accountability• Line & Staff Functions

2

Organisational Design & Organisational Structures

• Organisational Design : The determination of organisational structure that is appropriate for the strategy, people, technology and task of the organisation.

• Organisational Structures : The way in which an organisation’s activities are divided, organised and coordinated.

3

Organizational Design

1. The Classical Approach –• Fredrick Taylor- (1911)• “One Best Way to Accomplish the task”

• Henry Fayol – Principles of Management

• Max Webber- Bureaucracy

4

2. The Task-Technology Approach

Woodwards’ Research :Classified org. based on mode of technology

1. Unit

2. Mass

3. Process

5

Woodwards’ Research

1. Unit:• Manufactures custom made

products – • Tailor made suit, turbine or

Avanti cars

6

The Task-Technology Approach

2. Mass:• Manufactures would make

large-batch or mass produced products• Refrigerator, TV, Fans• Ford Motors

7

The Task-Technology Approach

3. Process production:• Heavily Automated Continuous

process providers• Oils & Chemical refiners• Reliance petrochemicals

AL JUBAIL PETROCHEMICAL PLANT, SAUDI ARABIA

8

3. The Environmental Approach

• Burns and StalkerStudied 20 org. to determine how their org. structure & managerial practices might differ based on different environmental conditions.

• They found org. structure found in dynamic environment is very different from org. structure found in static environment.

9

The Environmental ApproachMechanistic structures - a form of organization that

seeks to maximize internal efficiency• They performed – routine task• Slow in responding to unfamiliar

Organic structure – an organization form that emphasizes flexibility & adaptiveness

• people work more as teammates than as subordinates

• Influence based on knowledge than authority• Loosely defined responsibilities• Emphasis on exchanging information than giving

directions

10

Comparing Mechanist & organic structure

Characteristics Mechanist Organic

Task Definition Rigid Flexible

Communication

Vertical Lateral

Formalization High Low

Influence Authority Expertise

Control Centralized Diverse

11

Formal & Informal Organisations1. Formal Organisation:

• Set-up of roles for the achievement of organisation goals

• Reporting channels and job description is rigid• Accountability and responsibility are fixed

2. Informal Organizations• Formation is ad-hoc and follows no structure• They generally share same interest, ideas or

information.• They donot contribute directly to organisations

goals.

12

Span of Control of 4:Total employees = 4096

Managers at levels 1-6 = 1365

Span of Control of 8: Total employees = 4096Managers at levels 1-4 = 585

Difference in managers equals 780.

1

8

64

512

4096

1

4

16

64

256

4096

1024

Span of Control

Defines the number of people that one person will supervise. There may be a narrow span or a wide span of control.

Tall & Flat Org. Structure

13

Span of Control

1

4

16

64

256

1024

4096

18

64

512

4096

Span of 8Span of 4

Members at each level

Managers = 1365

Managers = 585

14

Matrix Structure

15

Network Structure

• Workers or worker groups contribute to multiple organizational tasks

• Work groups are reconfigured when the tasks change

• Relationships among groups are governed by the requirements of the task

16

Responsibility, Authority & Accountability

• Responsibility: One’s obligation to perform the function assigned to the best of one’s ability in accordance with directions received.

• Key principles to be considered :• Delegation should improve org. working• No two employees should be assigned the same

responsibility• The boundaries of the responsibility should be

fixed.• Org. cannot afford gap in the delegation chain.

17

Authority

• Authority:

• It refers to the right to give orders and the power to exact obedience from others in the process of discharging duties

• It enables managers to act, exert influence and make decisions in carrying out their responsibilities.

18

Accountability

• An employee’s answerability on using the authority in discharging a responsibility is termed as accountability.

19

Line & Staff Functions• Line function: The department or

employees of the firm that performs core activity that contributes to its business directly.

• Staff Functions: The department or employees of the firm that performs a support function that contributes to its business indirectly.

20

Line & Staff Conflict• Expectations & complaints from line :1. HR staff don't see the whole picture2. HR Staff try to steal the lime light3. HR doesn’t provide the right support.

• Expectations & complaints from staff:1. Line function is prejudiced & biased2. Doesn’t understand importance of

developing the employees3. Doesn’t value contribution of HRD

21

The role of HRD in an organisation

Specialist

Controller

Change Agent

Facilitator

HRD

22

HRM & other Org. Functions

Products

Techn-ology

Marketing

Production

HRM

23

HR Strategy ABBTo build value, performance and leadership into ABB, responsibility, respect and determination are key

Assuming responsibility, and acting with respect and determination makes it possible to nurture

ABB’s traditional strengths – our technology leadership, our pioneering spirit and our ability to be at home everywhere. That is our legacy, and our future.

‘3S’ (System, Speed, Spirit) Management Philosophy at ABB India.

Café – HR part of SAP HR module, serves as an employee self service portal:

• Payroll management, Leave & Attendance management etc