A key issue in accomplishing the goals identified in the planning process is structuring the work of the organization. Organizations are groups of people, with ideas and resources, working toward common goals. The purpose of the organizing function is to make the best use of the organization's resources to achieve organizational goals. Organizational structure is the formal decision-making framework by which job tasks are divided, grouped, and coordinated. The trend of creating equality among employees through flat hierarchical structures has helped in breaking the 'boss' and the 'worker' shackles in corporate world.
Historically, the concept of tight hierarchy was predominant in the manufacturing sector, even among MNCs. The interface between customers and employees was only through a higher authority. There was a strict distinction between employees in the lower rung and higher management. The mindset of following a strict hierarchy, which was influenced by the manufacturing industry, was seen among some early IT players too. The culture later changed when the emerging industries, where "people" are the key resource, realised that to attract talent, a flat hierarchy was an important branding too.
Flat organizations emphasize a decentralized approach to management that encourages high employee involvement in decisions. The purpose of this structure is to create independent small businesses or enterprises that can rapidly respond to customers' needs or changes in the business environment. The supervisor tends to have a more personal relationship with his or her employees.
Flat organization structure is also known as a horizontal organisation. It is a level wherein there is no level between the staff and managers. In such an organisation the most trained employees are involved in the decision making process. This structure mostly takes place in smaller organisation or also on a small scale within large organisation. However, when these organisations began to grow and expand, the company turns into a hierarchical organisation structure.
Gone are the days when the highest authority of a company was unapproachable in the company and was visible only at annual meets flaunting his power. The IT industry (and dotcom boom) brought into India the openness and flat hierarchical system in the corporate sector. The culture is almost the same in all organisations—everybody is on first name terms, people are demarcated less through designations, where anybody can walk into the boss' cabin or at least send him a direct e-mail. Moreover, if you happen to be a star performer, he might even take you out on lunch.
Flat structure not only emphasizes on wider span of control but also provides ample opportunity for employees to go for their self decision-making. The scope of empowerment is highest in flat organisation structure. Dismantling of hierarchy became a social invention at aggressive firms, as it needed to respond to customer requirements fast. The entire organisation had to be highly responsive to customer needs.
Flat structure if not implemented prudently, may lead to few nuisances, warn industry experts. An arrogant attitude can hamper work when an individual has the independence to take up decisions and assign jobs to others. It can also lead to passing the buck on others. Finally, it might affect the behavioral discipline of people. Another impediment associated with a flat structure relates to promotion.
The trend in the past 20 years has been "delayering". This occurs when the business increases the span of control and decreases levels of hierarchy. This has led to a decrease in the numbers of middle management. For a successful flat hierarchical structure, it is necessary to create a culture of openness. Poor and inconsistent communication may lead to chaos. By simplifying the hierarchical structure, many organisations are enjoying greater productivity. Transparency in governance has given more accountability, responsibility and authority to employees, by which the risk-taking ability has increased. Reducing barriers is a way of giving them an open culture to work and be involved with the growth of an organisation
References:
http://www.blurtit.com/q614282.html
http://telecollege.dcccd.edu/mgmt1374/book_contents/3organizing/pwr_auth/power.htm
http://www.expresscomputeronline.com
Historically, the concept of tight hierarchy was predominant in the manufacturing sector, even among MNCs. The interface between customers and employees was only through a higher authority. There was a strict distinction between employees in the lower rung and higher management. The mindset of following a strict hierarchy, which was influenced by the manufacturing industry, was seen among some early IT players too. The culture later changed when the emerging industries, where "people" are the key resource, realised that to attract talent, a flat hierarchy was an important branding too.
Flat organizations emphasize a decentralized approach to management that encourages high employee involvement in decisions. The purpose of this structure is to create independent small businesses or enterprises that can rapidly respond to customers' needs or changes in the business environment. The supervisor tends to have a more personal relationship with his or her employees.
Flat organization structure is also known as a horizontal organisation. It is a level wherein there is no level between the staff and managers. In such an organisation the most trained employees are involved in the decision making process. This structure mostly takes place in smaller organisation or also on a small scale within large organisation. However, when these organisations began to grow and expand, the company turns into a hierarchical organisation structure.
Gone are the days when the highest authority of a company was unapproachable in the company and was visible only at annual meets flaunting his power. The IT industry (and dotcom boom) brought into India the openness and flat hierarchical system in the corporate sector. The culture is almost the same in all organisations—everybody is on first name terms, people are demarcated less through designations, where anybody can walk into the boss' cabin or at least send him a direct e-mail. Moreover, if you happen to be a star performer, he might even take you out on lunch.
Flat structure not only emphasizes on wider span of control but also provides ample opportunity for employees to go for their self decision-making. The scope of empowerment is highest in flat organisation structure. Dismantling of hierarchy became a social invention at aggressive firms, as it needed to respond to customer requirements fast. The entire organisation had to be highly responsive to customer needs.
Flat structure if not implemented prudently, may lead to few nuisances, warn industry experts. An arrogant attitude can hamper work when an individual has the independence to take up decisions and assign jobs to others. It can also lead to passing the buck on others. Finally, it might affect the behavioral discipline of people. Another impediment associated with a flat structure relates to promotion.
The trend in the past 20 years has been "delayering". This occurs when the business increases the span of control and decreases levels of hierarchy. This has led to a decrease in the numbers of middle management. For a successful flat hierarchical structure, it is necessary to create a culture of openness. Poor and inconsistent communication may lead to chaos. By simplifying the hierarchical structure, many organisations are enjoying greater productivity. Transparency in governance has given more accountability, responsibility and authority to employees, by which the risk-taking ability has increased. Reducing barriers is a way of giving them an open culture to work and be involved with the growth of an organisation
References:
http://www.blurtit.com/q614282.html
http://telecollege.dcccd.edu/mgmt1374/book_contents/3organizing/pwr_auth/power.htm
http://www.expresscomputeronline.com