Organizational Structure, Culture, and Development

Organization

Definition and Purpose

Organization defines and guides work within a company. Its main objective is to ensure company goals are meaningful and important to all members, contributing to increased organizational efficiency.

Company Chart

A company chart structures the functions and activities of the company by generating functional areas and hierarchical levels. This facilitates coordination, efficiency, and achievements.

Formal Organization

A formal organization is deliberately established to achieve specific objectives. It’s characterized by a clearly defined structure, with policies and regulations that are clear, actionable, and known to all members. In essence, it encompasses all formally documented standards, policies, rules, and organizational structures.

Informal Organization

Informal organization refers to the social relations that develop spontaneously between individuals. These activities don’t follow specific regulations or structures. Examples of informal groups within companies include family groups, college friends, and social gatherings.

Management by Objectives

Management by objectives is a planning and control technique. It involves establishing and communicating organizational goals, identifying related individual goals, and evaluating staff performance against these goals. Leaders and managers define common goals, specify key responsibility areas for each position, and use these measures to guide operational improvements. This process assesses both individual and collective contributions.

Advantages

  • Improved management (planning for results)
  • Clearer organizational structure
  • Encouraged personal commitment to both individual and organizational goals

Disadvantages

  • Potential lack of awareness of company objectives among administrators
  • Emphasis on short-term goals over long-term organizational strength
  • Difficulty explaining the philosophy of self-direction and providing guidelines for target setting

Organizational Climate

Organizational climate refers to the environment created by the emotions of group or organizational members. It’s linked to employee motivation and is considered a volatile concept. Similar to group dynamics, it analyzes internal forces affecting the work environment, such as resistance to change. Understanding and measuring organizational climate is crucial for companies, as it significantly impacts results. Studies show it can differentiate between high and low performance.

Organizational Culture

Organizational culture is a complex mix of assumptions, behaviors, stories, myths, metaphors, and ideas that define what it means to be a member of a particular group. It also includes symbols, language, ideology, rituals, and myths. Organizational culture distinguishes organizations, even those with similar activities, products, and services. It encompasses goals, technologies, structures, policies, procedures, financial resources, and intangible elements like perceptions, attitudes, and shared feelings.

Organizational Change

Organizational change is the ability of organizations to adapt to internal or external transformations through learning. Any change in the work environment affects the entire organization and its elements. Change presents both human and technical challenges, requiring adaptation from company members and the application of appropriate management tools.

Facilitating change involves helping people visualize, internalize, and voluntarily embrace the goals arising from new situations.

Forces of Change

  • External: educational, cultural, political, social, economic, technological
  • Internal: functions, objectives, policies, and technology

Organizational Development

Organizational development is the systematic application of behavioral science knowledge at various levels (group, intergroup, and company-wide) to effectively implement planned change. Its objectives are to enhance work-life quality, productivity, adaptability, and personnel efficiency, both individually and collectively.

Benefits

  • Awareness of continuous improvement
  • Organization-wide change
  • Increased motivation
  • Higher efficiency and effectiveness
  • Improved work-life quality
  • Greater company engagement
  • Better conflict resolution

Limitations

  • Slow process
  • Potentially expensive
  • Medium-term results
  • Difficult evaluation
  • Potential for resentment towards the organization