TRADITIONAL ORGANIZATION AND ORGANIZATIONAL STRUCTURE IN MODERN BUSINESS ECONOMY

In organizations there are so many activities which have to be dealt with, costs minimized and profit maximized (optimal production). Initially, transportation; constraints, education levels that is modest among labor force and technical ability which is limited in collection, transmission of information and displaying ability as constraints resulted to the need of having centralized system of management that was strong. Management team had to come up with thoughts which were directed to workers to implement them. This system of organization is what is referred to as traditional organizational structure. This type of organizational structure was thus goal and causal oriented (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

Within the organization, there were/are hierarchies, control, rules and authorities which were used by management team to run the organization. With modern organizations, the growth of organization that is decentralized with strategic management is what is being emphasized. This paper will present the differences between the traditional and modern structure in an organization while trying to explain the advantages and set backs of traditional organizational structure (Lepoutre & Valente, 2012).

There are so many differences between the two structures of the organizations. When dynamic stability is considered, traditional organization emerges to more stable natural. However, there are a lot of disadvantages that accompanies it. The system is much closed and cannot be influenced by the environment besides not interacting with it. This is why the modern structure of organization is preferred. This is because; it interacts with environment in which it is operated. It absorbs inputs or resources from the surrounding then process them or transform them into products which are distributed to the environment. It can therefore be said that, traditional structure of organization is closed while that of modern is open to the surrounding.

There is a difference in flexibility between the two structures. Initially, it was impossible to change the structure. Although traditional structure was stable, it required a long time period for it to be changed. It is thus important to use traditional structure of organization if the stability required is for long term. This is an advantage for the traditional structure in an organization. However, organizations and companies experience frequent changes which make them to require a kind of structure which is flexible. This is because of the strategy by every organization to continue improving in order to remain competitive in the market. This is why it is strongly advisable not to use traditional structure in organization that requires being competitive in order to fit and remain the market (McFarlane, 2011).

A good example is the case with companies like Caterpillar, ABN Amro and Chrysler. They use production equipment which is computerized. They thus train workers on the use of the computers in production. The processes change every now and then. The description and structur5e of the job does not remain the same as it was the time of employees’ recruitment. Thus it is unadvisable to use the traditional structure of organization in such companies (Lepoutre & Valente, 2012).

The flexibility is further illustrated at the situation whereby, initially workers could remain in the same work level or group until they retire, retrenched or resign. This was because of the inflexible nature of traditional organizational structure. In current times, organizations have do not prefer permanency in jobs and groups of work. Teams are formed every now and then by taking of members from as per the need of the project. Therefore, changes in assignment of the job given to an employee are every now and then, hence they have to adjust accordingly to fit in the every new structure that comes into use. This is somehow impossible with traditional structure (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

In any modern organization, there are many changes which occur every now and then in their structures. There may be reorganization of divisions, processes of businesses get reengineered from time to time, critical activities do not get outsourced and lastly, there is frequent replacement of permanent employees with part time and freelance workers. All these are dynamisms which convince managers of organizations to use structure that is flexible so that they can easily adapt to transformation as well as help other people a part from the ordinary workers of the organization (McFarlane, 2011).

There is a difference between the two structures when the issue of cooperativeness at work place is considered. The traditional structure of the organization is somehow individual oriented. A manager will have to do organization and decision making while the worker has to do what has been told by the manager. Modern organizational structure almost everything is done in teams. It may sometimes be difficult to differentiate the role of the employee from that of the manager. The team work helps so much in achieving of efficiency and effectiveness in the objectives of the organization (Lepoutre & Valente, 2012).

The issue of teamwork has a lot of disadvantages for case of traditional structure in an organization. In any business, group work ensures that the task is at hand and executed with assistance of united effort. The impacts of the combined effort is experienced when the organization which implement it work like one individual. This enhances operation quality. Group work also contributes to equality in sharing of profit besides work division. In addition, organization owners develop an enhanced system which formulate responsibilities and authorities that are appropriate. The traditional structure can also not build the spirit of teamwork due to individualism (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

With team work, fair and equal task distribution in an organization is enhanced. This ensures execution of task at hand by all the working units and persons, with efficiency that is possible and best to achieve. Work division ensures punctuality in completion of work on time without extending time of completion. All this cannot be achieved if traditional structure of organization is used the demerit that is postulated by the individualism at the places of work (McFarlane, 2011).

The focus on risk avoidance is another incident which has to be studied with keen interest. Executing the job with highest efficiency and contributes to decrease in risks. This is best achieved if team work is used in performing the task. Moreover, failure as a burden is not individualized for the case of teamwork thus not borne by a single person. Minimization of risks is among some of the critical strategies formulated by the organizations. This means that, management team cannot use traditional structure in case it wants to reduce risks in the organization (Lepoutre & Valente, 2012).

There is specialization in teamwork. Unlike the traditional structure, modern structure categorizes employees into groups which are assigned different tasks. As efficiency and maximization of output is enhanced in each team, the spirit of efficiency and maximization is also enhanced at individual levels. Thus, the worker can optimize quality work which he performs besides maximizing efficiency. The end results are outputs which are of high quality evaluated both at individual level and as team work (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

Modern structure of organization postulates a big difference when dealing with customers. Unlike traditional structure that is rule oriented the current structure in any organization appears to be customer oriented. Modern businesses and firm emphasize satisfaction of customers and adhere to it as the means to their development and prosperity. This is a strategy which can never be achieved in the corporate world which is competitive if the rule orientation is used as a strategy. The higher retention of customers is determined by the services offered by the firm to its customers. This is a setback that traditional structure portray in the state of being ruled oriented (McFarlane, 2011).

There is homogeneity of work force in traditional structure of organization, a situation that contrasts the modern structure which uses the labor force that is diversified. Organizations that use diverse labor force enjoy some benefits which are not experienced in the traditional structure of the organization. With diversified force of work, employees’ retention and satisfaction is addressed besides the incidences of inclusion. This is where the workers also enjoy the advantages which are accrued from the diversification of the work force (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

Moreover, customers demography served by the work force is easily understood thus giving the organization an opportunity to understand the customers better. These equip the firms better so that they have proficient competition in the market. Issues of diversity change from time to time. Companies in United Kingdom consider diversity to be a tool for good cases of economies gives them a chance of reaching to new markets. So diversity is a tool which used in attracting new customers (Lepoutre & Valente, 2012).

As stated earlier, traditional structure of organization use hierarchy in administration, it therefore has hierarchy kind of relationship. This is in contrary to the lateral relationship which is used in modern method. In traditional structures, workers are ranked into various levels, highest being at the top and other levels lower than it. Each stage of the chain has employee who has others workers, under him/her, that are then on a lower level. Thus each employee’s role is defined. The hierarchy appears to be tall with spans of control that are narrow, widening as one moves down it. This structure is centralized with most critical decision being made by the CEOs (Rajaeepour, Azizollah, Mahmoud & Solmaz, 2012).

The short comings associated with this hierarchy structure are many. Some of them are that: the bureaucracy in the organization can be adjusted at a very slower rate than that at which the market is changing. This places the organization in a position in which it cannot meet the customers’ expectation in the market of operation by the organization. There may also be poor or miscommunication across the sections especially if they are on the same level. Moreover, there can be decisions which are beneficial to the departments that made them but not others or the entire business. This mostly occurs for the case of rivalry that is inter-departmental.

The hierarchy is used in the Catholic Churches. The top most level is occupied by the popes. Under him there is Cardinals who is followed by the Archbishops as the hierarchy moves down. However, with lateral structures, organizations are embracing it as a new concept which is more beneficial to the firms. The power of decision making is not only assigned to the executives, but employers are also responsible in doing it. With this system of structure, firms need fewer levels of management and regulations (McFarlane, 2011).

The employees are thus to cooperate while working with intention of prosperity of the business. The merits associated with the lateral structure are: there is improved communication. Companies which use it have overhead management that is minimized. In addition, teamwork is encouraged since the spirit of contribution to the solution is enhanced. Lastly, the delays in output production are eliminated when the lateral structure is used (Lepoutre & Valente, 2012).

In conclusion, there are a lot differences between the traditional organizational structure and the modern structures used in the organization. The two appears to be critical and thus used by various organizations. However, traditional structures have a lot of limitations accompanied with it. This makes the managers to evaluate the essence of each structure before they put it into use. While focusing to the market competition, most organizations prefer modern structure to the traditional one.

It is therefore advisable to use modern structure in organization because of its flexibility to changes, diversity to teamwork and production, customer oriented for market competition and efficiency and effectiveness in communication. These qualities are not present in traditional structure which is considered inflexible, rule oriented, bureaucratic and time demanding especially for the cases where changes are needed urgently.

References

Lepoutre, J. N., & Valente, M. (2012). Fools Breaking Out: The Role of Symbolic and Material Immunity in Explaining Institutional Nonconformity. Academy Of Management Journal, 55(2), 285-313.

McFarlane, D. A. (2011). Are There Differences in the Organizational Structure and Pedagogical Approach of Virtual and Brick-and-Mortar Schools. Journal Of Multidisciplinary Research (1947-2900), 3(2), 83-98

Rajaeepour, S., Azizollah, A., Mahmoud, Z., & Solmaz, S. (2012). Relationship between Organizational Structure and Organizational Alienation. Interdisciplinary Journal Of Contemporary Research In Business, 3(12), 188-196

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