Wikipedia An organizational structure consists of activities such as task allocation, coordination and supervision, which are directed towards

the achievement of organizational aims.[1] It can also be considered as the viewing glass or perspective through which individuals see their organization and its environment.[2] Organizations are a variant of clustered entities.[citation needed] An organization can be structured in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as the branch, department, workgroup and individual. Organizational structure affects organizational action in two big ways. First, it provides the foundation on which standard operating procedures and routines rest. Second, it determines which individuals get to participate in which decision-making processes, and thus to what extent their views shape the organizations actions.[2] Wikipedia

The study of organisational culture focuses on the values, beliefs and norms about what is important and how things should be done in a particular organisational setting.

Business performance is the organisations ability to attain its finical goals by using its resources in an efficient and effective manner in order to meet its primary mandate which is to increase profits. Now that we understand these elements lets us look at their varying types and what factors influence an organisation to adopt different types of structures and cultures. Structure exists to bring order to organisations; the fundamental nature of structure is the division of work among employee or functional departments and the coordination of their activities. There are factors that influence an organisations structure namely its size, as size increases the more complex division and sub division becomes, subsequently difficulty in control. Coordinating and communication increases as increase in layers have to be formed to regulate managers span of control i.e. the amount of subordinates one can control effectively. Span of control is proportional to the individuals skill, nature of tasks assigned and level of technology available. The nature of work of the organisation will determine how tasks will be assigned and divided and determine how many functional areas are required. The level of skill of staff will determine how tasks are structured the amount of supervision and level of independence to make decisions required. The level of technology available to carry out tasks, does it require creativity or the human element or can it be mass produced resulting in automation, reducing the number of employees required. Adapted from EDEXCEL HNC & HND Business Organisations and Behaviour Course book, (2004 p60). There are other factors which also determine an organisations structure but it is necessary to identify the different types of organisational structure. The Tall organisation structure is one that in relation to its size has a large number of management hierarchy and authourity; it has a narrow span of control. There is a long chain of command running from the top of the organisation, example Managing Director down to the bottom of the organisation example floor worker. There is a narrow span of control that is, each manager has a small number of employees under their control. This means that employees can be closely supervised and small groups enable team members to participate in decisions. There is a clear management structure. The function of each layer will be clear and distinct. There are clear lines of responsibility and control and there is clear progression and promotion up the hierarchy. The freedom and responsibility of employees (subordinates) is restricted which inhibits delegation and restricts employee initiative. Decision making could be slowed down as approval may be needed by each of the layers of authority. Adapted from http://www.learnmanagement2.com/organisational%20structures.htm.

The Flat organisation structure in contrast is one that in relation to its size has a small number of management levels and authourity; it has a wide span of control. There is a short chain of command running from the top of the organisation. Due to the small number of management layers, flat organisations are often small organisations. There is greater communication between management and workers with more opportunity for delegation. Better team sprit. There is less bureaucracy and easier decision making with increase in communication because of fewer levels of management but this sacrifices controlEmployees may have more than one manager/boss. Because of the small hierarchy it may limit/hinder the growth of the organisation. The structure is limited to small organisations such as partnerships, co-operatives and some private

limited companies. Functions of each department/person can be blurred and merge into the job roles of others. Managers may only get a superficial idea of business strategic plan and have to convert that plan into operational terms. At Some times managers tend to be overworked and are more likely to be involved in emergency management situations.

A Matrix structure organisation contains teams of people created from various sections of the business. These teams will be created for the purposes of a specific project and will be led by a project manager. Often the team will only exist for the duration of the project and matrix structures is usually deployed to develop new products and services. www.learnmanagement2.com. The advantages of a matrix include: Individuals can be chosen according to the needs of the project. There is increased flexibility and greater cooperation and mixing of skills. Employees foster attitudes accepting change and departmental monopolies are broken down. There is a motivation factor involved when employees empowered with greater participation and planning and control decisions. Some of the disadvantages include: A conflict of loyalty between managers over the use of resources. Increased autonomy of teams can make them difficult to monitor. Employees or teams with or more managers are more likely to suffer from stress at work.

A virtual organisation is an organisation that does not have any physical existence or permanence; they have a 'reality' only on the worldwide web. They can be created and re-formed to meet the needs of new projects. From a Human Resource perspective, virtual teams may be composed of specialists working from home, 'telecottages' or small companies. They work together for the purposes of the project. Selecting, managing and assessing the performance of virtual team members is a whole new ball game. http://www.hrmguide.co.uk/hrm/chap4/ch4-links4.htm Like the matrix structure virtual teams are formed and then dismembered on completion of tasks and new teams are then formed to tackle new objectives.

Culture influences the decision making process, style of management and what everyone determines a success in the organisation. Each culture stems from different assumptions about the basis of power and influence, what motivates people, how people think and learn, and how change should occur. http://www.onepine.info/phand.htm. Charles Handy (1987) cited in EDEXCEL HNC & HND Business Organisations and Behaviour Course book, (2004 p103) refers to culture as the way we do things around here. He also goes on to describe four main types of organisational cultures: Power culture, role culture, task culture and person culture. The power culture is frequently found in small entrepreneurial organisations, control and decisions are made by key personnel and there are little rules and procedures with minimal bureaucracy. The orginisation is not exactingly structured and is capable of flexibility adapting quickly to conform to change. There is need for good employee relations in order for this type of structure to be successful. As the organisations size increases personal influence of key members (usually owners, or investors) decreases,

this is why it is bound to small organisations where leaders have direct communications with all employees. This implies a flat organisational structure. The role culture often stereotyped as bureaucracy. Just as Max Weber theory (1964) implies there is hierarchy and scalar chain of command with defined and matched authourity and responsibility. There are clear job descriptions rules and policies. This implies a tall organisational structure which makes it inflexible and slow to change. This type of culture is evident in stable economic environments or where work is predictable The task culture seeks to join the right resources to employees to complete certain tasks. It is very much a small team approach, small organisations cooperating together to deliver a project. The importance is on results and achieving objectives. Individuals empowered with discretion and control over their work. There is clear division of labour and specialisation with each member of the team having expertise in a particular area. In such organisations there is no clear leader, influence is widely spread and based more on expert power than organisational/position or personal power. Performance is judged by results, and teams are dismantled on completion of objectives and new teams are formed in order to achieve new goals. This type of culture is reflected in matrix organisations. Person culture is where the individual is the central focus and any structure exists to serve the individuals within it.Individuals have almost complete autonomy and any influence over them is likely to be on the basis of personal power. Mullins (2005 p 892). The organisation depends on the knowledge, skill and ability of the individual. Individuals believe themselves superior to the organization.. Management and control is achieved only through mutual agreement. Analysis of theoretical framework and application to business performance Organisations must have some sort of formal structure in order for work to be carried out efficiently. As previously explained this is necessary to divide work into groups or sections of particular functions to prevent duplication of efforts in order to maximize their limited resources. Because an organisation comprises of people there is also an informal organisation with different interlocking relationships, which gives rise to different behaviours, attitudes, individual perceptions and levels of ability and aptitude. When people in a particular group deliberately come together to fulfill a specific goal (formal organisation) there are particular accepted ways to behave, speak, and interact. This gives rise to organisational culture where it may be formed intentionally or unknowingly to its members by the behaviours of influential members, not necessarily personnel high up the hierarchy but by members who exercise different forms of power within the organisation. The above mentioned are the main factors that influence business performance, they are closely interdependent on each other for the maximization of overall productivity hence the reason for human resource management. This relationship will now be individually examined in the different types of Organisational structures associated cultures and their influence on their employees resulting in their level of business performance. Business performance in a Tall organisation structure can be affected by the length of time it takes for the flow of information through the varying levels of the hierarchy

making the organisation inflexible slow to adapt too the Political, Economic, Sociocultural, Technological .Environmental and Legal factors. It has a narrow span of control causing tight control restricting individual freedom and empowerment which affects motivation. The level of motivation employees possess will affect their output affecting business performance. Employees may not have a clear idea of the big picture and may not realize the importance of their contribution. Its highly bureaucratic nature will influence its bureaucratic or role culture. Employees may have a negative perception towards work or because everything is so clearly defined and communication is limited this could result in an impersonal nature and attitude even greater affecting employee relations, affecting motivation, resulting in affecting business performance. This is why this type of culture and structure is usually bound to government ministries and institutions where there is not any need for competitiveness. In contrast a flat organisational structure possesses greater flexibility to the P.E.S.T.E.L. factors due to its reduced levels of management, ensuring greater survival. This quick ability to change makes it competitive able to quickly adjust to consumer demands giving it greater business performance. The wider span of control and greater levels of communication may encourage creativity, initiative and ability to make decisions giving the feeling of empowerment, resulting in motivated workers, which affects business performance. This is also dependant upon the individual personalities and networking relationships within the organisation. If people refuse to work together or tend to perceive what others say or do differently it could affect employee relations and output affecting business performance. This is why employees need to be selected that will compliment the organisational culture so that there will be good working relationships. The culture typically found in flat organisation structure is that of power culture and is usually bound to small organisations, such as entrepreneurs and partnerships. Being one of the newer organisational structures, it is a shift from the old belief of one man one boss; it also replaces the concept of hierarchy status or individuals use of organisational power to make decisions but that of expertise power of employees. The task culture is reflected in the matrix organisation and there is no clear leader within each team. These shifts give rise to employees high job satisfaction because of individual participation and the group identity thus affecting business performance, simply because motivated employees work harder. Usually team members do belong to a functional unit in the organisation example sales, marketing or engineering where they will return to upon completion of their tasks and when their team is dismembered. One clear disadvantage is that sometimes teams may have more than one project supervisor assigned, in relation to each functional area affected by the project. Having more than one boss can lead to stressful situations. Each supervisor may want their department to complete their tasks favorably competing with other departments for recognition causing conflicts of interest and inefficient allocation of resources thus ultimately affecting business performance. These teams in order for them to run efficient must be comprised of individuals who suit each other. Management must conduct a personality profile and asses each members different abilities, aptitudes and attitudes to ascertain whether there is a strategic fit in order to create a specific project team that will ably meet the task at hand. This individual approach makes the firm flexible to market changes and multiple reporting lines/ flow of communication ensures quick responses to P.E.S.T.E.L. factors ensuring business survival, competitiveness and business performance. The invention of the Internet and the World Wide Web, created virtual reality and

commerce has ventured into this realm. This gives rise to Virtual organisations which exist in this realm. This is a new concept as previously explained; individuals can work at their homes or at small offices any where throughout the globe. Costly overheads such as structures to house employees are eliminated. Its survival depends of technical expertise (aptitude and ability) of employees and technology. Like the matrix structure teams communicate electronically and form and dissolve in strategic combinations for individual tasks. There is a mixture of task and person culture associated with this structure. To a point Virtual organisations are only partly virtual, they are made up of people who form relationships and are affected by culture. There is sometimes the need for physical meetings which is essential for maintaining good working relationships and forming new ideas. This type of organisation requires control and discipline for work to be coordinated through the different timelines globally. Teams perform task and then leave reports for incoming shifts on the net so that there is coordination and communication to prevent duplication of efforts. Employees truly need to be aware of international cross cultural differences and perceptions so as not to offend other employees, this vital for survival because a breakdown in structure will result in extinction. An example of a virtual organisation is amazon.com. The relationship between culture strength and business performance depend on how strong-culture firms learn from and react to both their own experiences and changes in their environment. The benefit of having strong culture in the organisation is improved goal alignment between the firm and its members. It also confirms behavioural consistency so that there is less room for debate between different groups about the organisations goals. Strong cultures increase employees motivation and performance because they believe that their actions are freely chosen. Edgar Schein postulated that culture ultimately reflects the group's effort to cope and learn. Adapted from http://www.onepine.info/phand.htm. As explained in the learning cycle an individuals ability to learn from situations and experiences will affect their relationships, ability to perform and understand thus affecting perception and attitude. This affects individual behaviour and social interactions. Organisational culture is also a major determinant in employee behaviour. Does the organisation recognize merit? Does culture promote communication? And does culture promote problem solving? Also the level of economic success and cash flow will affect the organisations job enrichment and training such that, organisations that can afford to further train their employees investing in their human capital will promote a culture for personal development and higher physiological needs as compared to an organisation who cannot afford such training.

Reference Jackson J.H. and Morgan C.P., Organization Theory , Second Ed., Prentice-Hall, 1982 Thompson J.D., Organization in Action , New York: McGraw-Hill, 1966 Katz D. and Kahn R.L., The Social Psychology of Organizing. Second Ed., NewYork: Wiley, 1978 Child J., Organizational structure, environment and performance: The role of strategic choice. Sociology Vol: 6, Date: 1972, p: 1-22 EDEXCEL HNC & HND Business Organisations and Behaviour Course book, 2004, London: BPP Professional Education Trompenaars, F., (1999) Cited in Mullins, L. J., 2005, Management and Organisational Behaviour, Seventh Edition, Financial Times, Prentice Hall David Knights & Hugh Willmont, (2007), Introducing Organizational Behaviour & Management http://www.businessdictionary.com/definition/organizational-structure.html