Good Organisational Structure Enhances Infrastructure

A person who has a lazy, slow-moving gait tends toworldwide efficiency is required, then this structure is
look less commanding than someonewho walks withmoreappropriate. Examples of industries requiring such
a good posture that exudes confidence. Likewise, thestructure include electronic chips,consumer electronics
way the companyis organised can help it position foretc. The disadvantage of this structure is the erosion
future growth.of localresponsiveness as it entails very centralized
The world has changed dramatically. These days,control.
being internationally competitive is thename of theTransnational
game. With the dissolution of the international tradeIn some cases where both local and global know-how
barriers and theevolution of a new global economy,are important, the transnationalstructure may be
many companies have gone through a continuumappropriate. The organisational structure is based on a
oftransition from being international (stressing anmatrix with dualreporting and the achievement of
export-import orientation), to beingmultinationalconsensus as the key driver.
(having major operations abroad that areDepending on the nature of your business, you
concentrated on specific,relatively protectedshould adopt an organisational structurethat enables
markets) to being global (looking at the entire worldyou to meet with your business objectives, and
as a market).which will provide flexibilityand room for future
The new and total global economy has come of age.growth. The common thread in the above three
There are three organisational structures:structures is theconcept of 'flat organisation'.
Multi-localThe phrase 'flat organisation' is now overworked and
The overseas affiliates are given full autonomy withmisunderstood. It is an oxymoron,a contradiction in
little interference from theheadquarters. Thisterms. Any organisation that exists for a purpose
structure is suitable for organisations that require highneeds a spine ofdecision-making accountability. This
customisation,flexibility and speed to respond to theapplies to private corporations, public
market place. Examples of industries requiringsuchinstitutions,voluntary organisations and cooperatives.
structures include the retailing, auditing and consultingA good organisation structure is one with the optimal
businesses etc. Thedownside is that there arenumber of layers of leadership,which demonstrably
wasteful duplications and low cost efficiency.add value to the work of the others. This includes
However, inindustries that require ground knowledge,the design anddelivery of mission and strategy. It
the trade-off for economy of scale andduplications isprovides space and challenge for individuals toachieve,
speed and flexibility.continue to learn, grow and enjoy their work and be
Globalduly rewarded for theirperformance.
The overseas affiliates are given little autonomy. TheThe theory is clear. The problem for managers is
headquarters make all the majordecisions. Thehow to design it in practice. How manyvertebrae
organisational structure is by functions, with eachshould there be in this spine of accountability? What
function such as thesales and marketing, financialare the key functions?
heads of the subsidiaries reporting to theHow are they identified? What is the impact of
headquarters'functional heads. In some companies,removing a function from this spine?
the functions are grouped by product lines andmajorWhat impact will this have on the development and
customer accounts reporting back to the heads formotivation of the incumbents?
the product lines and multinationalaccounts. If