Structure and Forms | Public Administration Optional for UPSC (Notes) PDF Download

Structure of Organizations or Organizational Structure

The arrangement and organization of parts within a system or organization is referred to as structure. Organizational structure defines how tasks are performed within an organization. It determines the form and function of the organization, including how different departments and offices are interconnected to form a cohesive whole. The goal of organizational structure is to coordinate actions and activities, as well as assign tasks to employees in order to achieve organizational goals and objectives. When studying the structure of an organization, factors such as organizational charts, rules and regulations, decentralization and centralization, standard operating procedures, responsibility, and authority are taken into consideration.

Types of Organizational Structure

• Pre-bureaucratic structures: Pre-bureaucratic structures lack standardized tasks and are commonly found in smaller organizations. They are most effective for simple tasks and have a centralized structure where key decisions are made by the strategic leader through one-on-one conversations. This structure allows founders to have control over growth and development in entrepreneurial businesses.
• Bureaucratic structures: Bureaucratic structures, as described by Max Weber, emphasize precision, speed, unambiguity, strict subordination, and reduction of costs. They have a certain level of standardization and are better suited for larger or more complex organizations. Bureaucratic structures often adopt a tall structure with clear roles, hierarchical levels, and respect for merit.
• Post-bureaucratic structures: The term "post-bureaucratic" is used in two senses. In a generic sense, it refers to ideas that contrast with Weber's bureaucratic model, such as total quality management or culture management. However, these ideas still maintain some bureaucratic characteristics. In a more specific sense, post-bureaucratic organizations are fundamentally non-bureaucratic, with decision-making based on dialogue and consensus rather than authority. They focus on organizational culture and emphasize participation and empowerment.
• Functional structure: Functional structures involve employees specializing in specific tasks within functional divisions, such as an engineering department staffed with software engineers. This structure allows for operational efficiencies within each group but may result in a lack of communication and inflexibility between functional groups.
• Divisional structure: Also known as a "product structure," the divisional structure groups functions into divisions, each containing the necessary resources and functions. Divisions can be categorized geographically or based on products or services. Each division may have its own sales, engineering, and marketing departments.
• Matrix structure: The matrix structure combines functional and product structures by grouping employees based on both function and product. This structure uses teams to leverage the strengths of functional and decentralized forms. There are different types of matrix structures, including weak/functional matrix, balanced/functional matrix, and strong/project matrix, depending on the level of authority and power given to project managers.
• Organizational Circle: Moving back to flat: As companies grow, their structures often become more complex and hierarchical. However, there is a trend towards flatter, less hierarchical, and more flexible structures due to globalization, competition, and evolving customer demands. The flat structure, common in small companies and start-ups, encourages decision-making, empowers employees, and develops their skills. It can be seen as a complex form of the matrix structure, maintaining coordination across products, functions, and geographic areas.

Additional Organizational Structures

• Team: The team structure defines the entire organization in small businesses, and it can be both horizontal and vertical. Teams are formed to synergize individual competencies and achieve organizational goals. Larger bureaucratic organizations can also benefit from the flexibility of teams.
• Network: The network structure involves contracting out business functions to external entities that can perform them more efficiently or at a lower cost. Managers in network structures focus on coordinating and controlling external relations, often through electronic means. Complex networks theory has provided management opportunities in areas such as product design, development, and innovation.
• Virtual: Virtual organizations do not physically exist but operate through software and networks of alliances, often utilizing the Internet. These organizations can be small in core size but operate globally, specializing in niche markets. The unlimited shelf space of the web enables virtual organizations to offer a wide range of niche products.

Forms of Organisations

Different forms of organizations exist within the government setup to carry out diverse functions with discretion and ensure smooth operations. These organizations are granted suitable autonomy based on their requirements.

1. Ministry/Ministries:

A ministry refers to the office of a minister or political executive responsible for directing, supervising, monitoring, controlling, and functioning in a specific area. It plays a crucial role in the democratic implementation of public policies. A ministry is headed by a political executive, while day-to-day activities are managed by administrators or bureaucrats. The minister, being elected by the people, ensures that the ministry works towards fulfilling the needs and choices of the people. Ministries organize and handle specific business areas under the broader policy framework.

2. Department:
A department is a unit within a larger organization assigned with specific responsibilities. It serves as the fundamental arrangement for organizing the policy process, including policy formulation and implementation activities. Departments can operate under a minister or independently, reporting directly to the Prime Minister. Some departments may be merged under a ministry, and in such cases, they are headed by the minister in charge while day-to-day operations are managed by experienced senior bureaucrats. Departments facilitate communication and coordination between the executive agency and the ministry.

Common types of departmentalization include:

• Functional departmentalization: Grouping activities based on functions performed.
• Product departmentalization: Grouping activities based on product lines.
• Customer departmentalization: Grouping activities based on common or specific types of customers.
• Geographic departmentalization: Grouping activities based on territories.
• Process departmentalization: Grouping activities based on product, service, or customer flow.

Organizations often use a combination of these methods for effective departmentalization due to the complexity of tasks and the competitive environment.

3. Corporation:
A corporation is an organizational arrangement created through legislative instruments. It may be established after the constitution enactment to address specific challenges or technological needs. Corporations are granted autonomy and discretion in decision-making and implementation. They assist in the success of five-year plans by managing and allocating the country's resources for the welfare of the people. Corporations are controlled by the government and are considered legal entities with their own rights and identities. They can acquire assets, operate as separate cost or profit centers, and act independently of political influences in their day-to-day operations.
An example is Municipal Corporations, created by an act of parliament, which provide essential services in towns and villages. They manage services such as water supply, hospitals, roads, street lighting, drainage, solid waste management, fire brigades, and maintain records of births and deaths. Municipal Corporations have sufficient financial autonomy and generate income through taxes and grants.

4. Company:
A company is an organizational arrangement for managing functions related to commercial areas. It is also a legal entity capable of entering into contracts and can be sued or sue in a court of law. A government business company operates based on market factors and aims to generate profits for the government, which are utilized for public benefit through planned investments. Companies can raise funds through loans, public capital, and have limited liability tied to their assets. They are more market-oriented compared to corporations. Companies are formed to ensure economic self-sufficiency and profitability in areas where the private sector may be reluctant to invest due to high risks or heavy investments, such as railways or mining. Corporations, on the other hand, focus on developmental activities and collect earnings as taxes for services provided.

5. Boards And Commissions:
Boards and commissions are organizational units created by the executive branch to facilitate deliberations by specialists in specific fields. They ensure politically impartial decisions and recommendations through the involvement of experts with high standards of integrity. Rational decision-making prevails in these organizations due to the expertise of the individuals involved. Boards and commissions can have advisory functions, providing recommendations to the government on specific issues. In other cases, they may possess substantive and executive powers. Examples include the Administrative Reforms Commission, Law Commission, Atomic Energy Regulatory Board, Election Commission, and Union Public Service Commission.

6. Committee:
Committees are associations formed within an organization or field to represent a larger organization and make decisions or gather information for its betterment. Committees relieve the overall organization from specific tasks such as analysis and deliberations, allowing them to focus on core business areas. Committees can be either ad-hoc or standing in nature. Examples include the Haj Committee of India, Genetic Engineering Approval Committee, Alagh Committee, and Public Accounts Committee.

7. Council:
Councils are organizational forms where various parts of the entire body or organization are given equal representation in the decision-making process to build consensus. Examples include the National Development Council, Inter-State Council, South Zone Council, and Council of Ministers.

8. AD-HOC and Advisory Bodies:
Ad-hoc bodies are appointed by the political executive to aid in discharging specific functions. They are created urgently and disband once their purpose is fulfilled. Advisory bodies are formed to provide deliberations and thorough analysis by specialists before implementing policies. These bodies may be appointed by the Cabinet Secretary, Prime Minister's Office, or other appropriate levels as deemed fit by the executive.