I am intimately aware of two organizations personally, the first is a little company that I started, and the company where I work now. By selecting two companies that I have worked with and for, I am able to better understand in detail the structure, organizational functions, and structural design. I started working out of high school on a little ranch in the foothills of the Sierra Nevada Mountains in California. Soon after starting my life in the workforce, I received training in installing and testing propane and natural gas piping.
When life on the ranch settled down, I had time to kill and skills to offer. I soon found that there was a need in the area for a company that could go into houses and replace existing gas piping in such a way that did the least amount of damage to the structure. When business again slowed down and I needed to put food on the table, I switched gears and began working for another company; the company I still work for to this day. Beginning with my little company, the structure was simple, with myself as the owner, and at most three employees.
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On jobs, I divided the four of us into two teams, a supervisor and a helper each team. This created a horizontal organization, and one that allowed for great flexibility, input form the field though there was greater involvement in each operation by myself and the other supervisor. The real evidence behind my little company being a vertical organization was the final authority to make decisions. This power allows lied with me, and when I walked onto a job, my word was always final. This means the final decision making belonged to me as a person rather then the position.
This is the primary difference between the next company I worked for; where the authority went with the title and position rather than the person. In my current company, there are hieratical levels that manage even more levels. This is am example of a vertical organization, and in this case, we are looking at a functional organization. Moving beyond my little company where I was the Human Resources, Purchasing, Marketing, Finance, and Site Manager; we return to me current company and the functional organization structure.
In a functional organization, we see all the specialist groups all reporting to the top of the organization and having their own internal hierarchy. This compared to a divisional organization where all the specialties are grouped based on another factor like geography or demographics. This means instead of divisional directors or vice-presidents located around the country and each having similar resources under them, we see directors and vice-presidents with a limited scope of the business under them but the full scope of that portion.
This means that all of the company operates the same way for example all of the marketing is done through a single branch of the organization for the entire company so all of the marketing plans are the same. In a divisional organization, each division would have their own marketing departments, which could result in different marketing schemes as you move from division to division. Because my current company offers only a limited array of products, a product-based organization would encompass the entire company with little to no divisional differences.
There are some geographic considerations however these geographic departments are still managed by a single up-line regardless of their location. As with geographic teams; there are a few cases when matrix teams are created to get a job done. Most of the time, the cross-departmental teams that are created to get a job done, and then they are dissolved. While no organization is going to be purely structure or another, we can see where organizations begin to prefer or trend toward one form. As mentioned before, my current organization has adopted a model where employees become specialists, and are grouped with others of their specialty.
For example, there are 5 people in my office and all 5 of us are managers, managing 5 very different regions of the nation in all things distribution. The company has grouped all of us together and separated us form other employees that are not focused on completing the same tasks. This means that for a greater geographic area, all of the operations are completed the same way at the same time. Knowing the others I work with and the ideas that are brought to the table during our regular meetings, if we were not under the same management, then there is a real possibility that all of our operations would be vastly different.
By having a unified operation, it is easier for employees to move around and know the operation. Auditing the operation is also easer when all the standards, goals, and measurements are the same. Finally, similar to a fingerprint there are enough variations in organizational structures that there will never be two managed or structured the same. Like everything else in the business world, the structure is based on the needs of the business. It was decided years ago that letting the separate geographic areas manage themselves autonomously could have complications.
For this reason, more structure and unity was required for the different functions of the business. In addition, by pooling resources into specialized groups, there is less impact to the organization caused by turn over or even short-term events like vacations. If we were to divide up the team I work on, I would be he only distribution manager for hundreds of miles and unable to pass off work when I was going to be unavailable. By being on a specialist team, all I have to do is walk down the hall and I know that the job will be done the same way I would have done it.