ORGANIZATIONAL THEORY

Organizational Theory

ORGANIZATIONAL THEORY

Relationship between management structure, organizational culture, and its effect on business performance

The structure of an organization or the management structure of an organization consist of the hierarchal levels of an organization; this management structure helps the company in the development of the guidelines on the topic of subordination and responsibilities of the different employees, and has the potential to impact the culture of the organization. (Denison 1990, Pp. 25) The culture of an organization can be defined as an intimate and conjointly held packet of values and ideas, in addition to the different relationships in the workplace and the different ways of doing things in the organization. The culture of an organization is directly dependent on the management structure of that organization, because the management structure defines the hierarchy of an organization and this in return, helps in development of the culture in the organization. (Deal & Kennedy 1982, Pp. 10) The hierarchy of an organization is related, in direct proportion, to the culture of an organization, and can have a serious impact on the performance of the business. A flat management structure would ensure an open culture in the environment and the employees would have the chance to express them openly and convey their concerns openly, this would motivate the employees. On the other hand, a highly defined organizational structure would mean that the employees would have to follow a long process before they have a chance to have a chat with the top management of the organization. Therefore, the management structure and the organizational culture can really affect the performance of the employees in business. (Ashkanasy, Wilderom & Peterson 2000, Pp. 12)

Factors affecting individual performance

Numerous factors have the potential to influence the performance of an individual in an organization. Some of the main factors have been listed below:

The ability and the capacity of a person to be trained & execute the required tasks

The expected performance standards can also have a great influence on the performance of an individual. The opportunities and the expectations that have been associated with a person can influence the performance of an individual. (Banks & May 1999, pp. 118)

The level of skills and knowledge possessed by the employee is a major determinant of the performance of an employee. (pp. 118)

Classical organizational theory

The classical organization theory was developed during the first half of the twentieth century. It has presented the idea of the combination of the different techniques of management i.e. the bureaucratic theory, administrative theory, and scientific management. (Bond 1988, Pp. 41).

The scientific management theory has four essential guidelines. Firstly, it is essential to discover the best possible way to perform a job. Secondly, it is crucial to match every worker to with his/her task and job, and third principle states that it is very important to intimately monitor the employees, and utilize the tool of punishment and reward to motivate people, and the fourth principle states the whole case of management is dependent on the process of planning and ...