NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
Module: 2 Lecture No: 9
Learning Objectives
To understand what is meant by organisational structure.
To understand structural configurations of organisation.
To understand different coordination mechanism within organisation.
To understand different organisational structures.
To understand the key parts of different organisational structures.
Important & Relevant Questions
What are major areas of classical management theory?
What is the major difference between classical and behavioural management theory?
Explain the difference between closed system management approach and open system
management approach with suitable examples.
What is total quality management philosophy? Elaborate different tools and principles
used by the managers for total quality management in the organisation.
Evaluation Questions
What is scientific in scientific management?
What is the major difference between classical and behavioural management theory?
What is closed and open systems management approach?
What is the major difference between Indian management style and Japanese
management style?
References
Koontz H. and Weihrich H., Essentials of Management: An International, Innovation,
and Leadership Perspective, Ed. 3, McGraw Hill Education Private Limited, India.
Bhat A. and Kumar A., Management: Principles, Processes, and Practices, Ed. 10,
Oxford University Press, India.
NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
An organisation chart formally describes the division of activities within an organisation. It
indicates reporting structure (who reports to whom) and describes the vertical channels of
communication that link the CEO with the operating level. It also maps different departments,
which exist because of functional differentiation horizontally.
Organisational structure is a framework on which an organisation is patterned for
coordinating and carrying out organisational activities. Henry Mintzberg, the organisational
theorist, has elegantly typified certain organisational configurations based on the key part of
the organisation and the predominating coordinating mechanism employed by that type in
following figure.
Figure 1: Five basic parts of an organisation
Operating core
The operating core consists of operators who perform the main work directly related to
the production of goods and services. For example, lecturers in a university or assembly
line workers in an automobile plant would constitute the operating core of the
organisation.
Strategic apex
It refers to the top level management that has the ultimate responsibility of guiding the
organisation towards its mission and goals. For example, a company’s board of
directors, its CEO, and VPs would constitute the strategic apex, primarily responsible
to the company’s various stakeholders.
NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
Middle-line
The top management of a company is joined to its operating core by a chain of middle-
line managers, who given formal authority. They play an important role in transferring
information from top level managers to operating core. For example, general managers,
divisional managers, factory heads, etc.
Techno-structure
Different departments within an organisation control particular form of standardization
in the organisation. For example, the inspection department controls the quality of
inputs, process, and the final outputs. The personnel department controls the quality of
manpower according their knowledge, expertise, skill, and attitude norms, while the
designdepartment specifies and standardizes product dimensions, processes, etc.
Support staff
This refers to all other departments/units that exist to provide support to the organisation
outside its main work area. For example, transportation department, canteen, security
services unit, etc. Most of the time it makes a greater sense to ousource these specialized
services.
Further, as per Mintzberg, there are five types of mechanisms employed by the organisations
to coordinate their activities. These coordinating mechanisms are:
1. Direct supervision
When one person supervises the work of others, as in case of an entrepreneur in a small
start-up who supervises his/her workers directly to achieve the objectives thus, acting
as the main and only link to achieve coordination.
Figure 2: Direct supervision coordination mechanism
2. Mutual adjustment
This method of coordination can be achieved only when a degree of informal
communication happens between different functional experts in a project team.
NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
Figure 3: Mutual adjustment coordination mechanism
3. Work process standardization
The work process standardization itself can promote coordination between different
units as is exemplified, for instance in the process of an assembly line.
Figure 4: Work process standardization coordination mechanism
4. Outputs standardization
This happens, for example, finished product or service specifications and standards act
as means of coordinating work as concerned departments have to coordinate till the
output meets the specification.
Figure 5: Outputs standardization coordination mechanism
NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
5. Skill or knowledge standardization
Often the qualifications, training, and experience of the personnel may act as a major
source of coordination in an organisation. For example, in an operation theatre of a
hospital, the anesthesist, the surgeon, and the staff nurses coordinate to complete the
operation successfully.
Figure 6: Skill and knowledge standardization coordination mechanism
As an organisation grows big and complex, the preffered means of coordination are
from type 2 1 3 4 5.
Taking into account the key role that the various parts of an organisation play and the
predominant or the main coordinating mechanism that they employ, Mintzberg further
classifies organisations into the following configurations – simple structure, machine
bureaucracy, profession bureaucracy, divisionalized structure, and adhocracy.
I. Simple structure
A medium-sized retail store, a corporation run by an aggressive entrepreneur, a
government run by an autocratic politician, etc. are all examples of a simple
structure. The key part in this type of structure is the strategic apex that tries to
centralize and control. The main coordinating mechanism is direct supervision.
The strategic apex, in order to centralize and coordinate bu direct supervision,
structures the organisation as a simple structure.
II. Machine bureaucracy
A security agency, national post office, a steel company, a custodial prison,
national railways, etc. are all examples of a machine bureaucracy. The chief
component in this organisation is the techno-structure and the main coordinating
mechanism work process standardization. The techno-structure strives to
coordinate by the standardization of the work process and to structure the
organisation as a machine bureaucracy. The prime desire of the key part is to
increase its influence.
NATIONAL INSTITUTE OF TECHNOLOGY SIKKIM
Ravangla Campus
Barfung Block, Ravangla Sub Division, South Sikkim-737139
Department of Mechanical Engineering
Principles of Management (HS16101)
III. Professional bureaucracy
A general hospital, a university, public accounting firms, and social work
agencies are all examples of organisations that follow the structure of a
professional bureaucracy. The key part in this type of structure is its operating
core and the main coordinating mechanism is the skill or knowledge
standardization. The operators within this structure tend to professionalise,
coordinate by standardization of skills, and structure the organisation as a
professional bureaucracy. The main desire of the key part is to maximize their
autonomy.
IV. Divisionalized structure
The divisionalized structure is followed by a vast majority of private firms. The
main part of such organisation is the middle-line management and the main
coordinating mechanism is outputs standardization. The middle management
tries to group together the organisation, with coordination restricted to the
stnadardization of outputs, to structure the organisation as a divisionalized
structure. The main desire of the key part is to garner autonomy so as to manage
their units.
V. Adhocracy
A space agency, a factory manufacturing complex prototypes, consultancy
organisations, etc. are all examples of adhocracy structures. The chief
component in this structure is the support stff and the main coordinating
mechanism mutual adjustment. The support staff tries to coordinate by mutual
adjustment so as to structure the organisation as an adhocracy. The main desire
of the key part is for collaboration and innovation in decision-making.
Table 1: Structure configurations and coordinating mechanisms
Structural Prime coordinating Key part of
configurations mechanism organisation
Simple structure Direct supervision Strategic apex
Machine Work process Techno-structure
bureaucracy standardization
Professional Skill or knowledge Operating core
bureaucracy standardization
Divisionalized Outputs standardization Middle-line
structure
Adhocracy Mutual adjustment Supporting staff
