Page 105 - DMGT520_ORGANIZATION_CHANGE_AND_DEVELOPMENT

Organization Change and Development

Notes structures, processes and a climate that allow it to effectively manage its important and pressing
business (e.g. projects, problems, crises, etc.) while giving adequate attention to strategic issues
(e.g., long-term development and renewal, planning and envisioning, engaging new
opportunities, crisis prevention, etc.)
Structure, is an integral component of the organisation. Nostrum and Starbuck (1981) have
defined structure as the arrangement and interrelationship of component parts and positions in
an organisation. Structural OD intervention provides guidelines on:

 Division of work into activities;
 Linkage between different functions;
 Hierarchy;
 Authority structure;

 Authority relationships; and
 Coordination with the environment.
Organisational structure may differ within the same organisation according to the particular
requirements structure in an organisation has three components (Robbins, 1989):
 Complexity, referring to the degree to which activities within the organisation are
differentiated. This differentiation has three dimensions:

 Horizontal differentiation refers to the degree of differentiation between units based
on the orientation of members, the nature of tasks they performed their education
and training,
 Vertical differentiation is characterized by the number of hierarchical levels in the
organisation, and

 Spatial differentiation is the degree to which the location of the organisation’s offices,
facilities and personnel are geographically distributed.

 Formalization refers to the extent to which jobs within the organisation are specialized.
The degree of formalization can vary widely between and within organisations.
 Centralisation refers to the degree to which decision-making is concentrated at one point
in the organisation.

7.3.2 Designing Organizational Structures

Some important considerations in designing an effective organisational structure are:
 Clarity: The structure of the organisation should be such that there is no confusion about
people’s goals, tasks, style of functioning, reporting relationship and sources information.

 Understanding: The structure of an organisation should provide people with a clear picture
of how their work fits into the organisation.

 Decentralisation: The design of an organisation should compel discussions, and decisions
at the lowest possible level.
 Stability and Adaptability: While the organisational structure should be adaptable to
environmental changes, it should remain steady during unfavorable ‘conditions.

100 LOVELY PROFESSIONAL UNIVERSITY