Twenty First Century Organisational Trends

In the emerging world order, four key organisational trends are visible: Globalisation, diversity, flatness and networking.

•Globalisation
Manifested in

Increasingly globalised sales, manufacturing, research, management. Movement from direct exports to having sales offices in different
countries spread across the globe.

Increasingly globalised labour market.

Due to 

Reduced cost and improved quality of international transportation and communication.

Search for unsaturated markets.

Exploit regional cost and expertise differences.

•Diversity

Manifested in

Workforce getting more heterogeneous in gender, race, culture, language, etc.

Due to Differentiated customer needs – fulfilling them is a source of competitive advantage.

Increasing access of workplace to diverse populations.Increased pace of change in technology and markets.Diversity in organisations is a source of both innovation and conflict/communication problem. Managers in such organisations need to cope with different styles of interaction, presentation, dress, physical appearance, etc.

•Flatness
Manifested in

Fewer levels of management.

Empowerment of workers for making decisions.

Fewer differences in responsibility (not in pay) across levels.

Due to Need for quick decision making.

Development in information technology.

Globalisation which forces intensified competition and increases the need to cut costs.

•Networking

Manifested in

Direct communication across unit and firm boundaries, ignoring chain of command.

Cross-unit team structures.

Outsourcing and downsizing.

Strategic alliances with competitors, customers and collaborators all at the same time.

Close coordination among firms (e.g., JIT systems) and information sharing (open computer systems).

Across the board contact with customers, not just official boundary spanners.

Customisation.

Decentralisation.

Due to

New information technologies, especially, groupware, client-server, distributed computing.Fast changing customer needs and competitor offerings.More complicated products require better integration of manufacturing, design, and marketing functions.All these trends imply a strong need to design and redesign the organisations again from time to time to increase their efficiency and effectiveness.Therefore, you need to understand the organisational designs and structures.

Organisational Design

Organisational design deals with structural aspects of an organisation. It aims at analyzing roles and relationships of various categories of staff so that collective effort can be explicitly organised to achieve organisational goals.The design process leads to development of an organisational structure consisting of units and positions. The relationships involving exercise of authority and exchange of information between these units and positions are depicted in Fig.

Organisational Design - The dashed arrows mean, “creates the need
for”, while the solid arrows mean “causes” or “enables”.

Thus, organisational design is the process of systematic and logical grouping of activities, delegation of authority and responsibility and establishing working relationships that will enable both the company and employee to realize their mutual objectives.

Organisational Structure

Organisational structure defines how tasks are formally divided, grouped and coordinated. Managers need to address the following six key elements when they design their organisation’s structure:

• work specialisation;

• departmentalisation;

• chain of command;

• span of control;

• centralisation and decentralisation; and

• formalisation.

Their descriptions are presented in Table.

Key Elements in the Design of Organisational Structure