Wednesday, April 4, 2007

How can an organization use more than one type of organizational design?

Combinations of organizational forms are often used in a single organization. Usually one form overlays another.

A hierarchy with centralized power can decentralize into business units, each another small hierarchy containing the unique functions to run that specific business. Meanwhile the original hierarchy still exists, managing shared resources.

A hierarchy that manages resource allocation to organizational functions can be overlaid with co-ordinating roles to identify synergies and prevent duplications and create a matrix organization.

Overlaying a hierarchy there can be multiple cross-functional project teams creating a project oriented organization.

Overlaying almost all hierarchies are official and often unofficial groupings that manage processes not well suited to a hierarchy.

It appears hierarchy is always the foundational structure for allocating resources with one or more overlays that ensure focus is also given to the application of resources which almost always occurs cross-functionally.

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