Organizations have different management structures, depending on various factors like size. Common examples of these structures include flat organizations and hierarchical organizations. This essay discusses hierarchical organization, focusing on its advantages and disadvantages as a management structure of many companies in the business world.
Hierarchical organization is a management structure, where a top-down type of reporting is highly emphasized. It has different layers and levels of management and the topmost person in ranking is either the President of the company or CEO. This is common with large companies and multinationals. Here, communication is from the top-downwards for implementation of policies and decrees. This type of management has a wide range of pros and cons, even though ot is the commonest management approach.
The first advantage is that it enhances clear reporting. In hierarchical organization, employees know who to report to as hierarchical structures are always defined. This eliminates the frustration that exists when employees cannot identify their boss. It streamlines communication since there is feedback as managers engage those under them directly. Here, the manager can choose to give directive or forward the feedback upward for response. Moreover, employees get information from supervisors, who disseminate whatever details or orders they get from line managers. This close harmony, which comes with effective communication between the management and employees, is paramount, especially in small organizations.
Another advantage of hierarchical organization is that it augments effective decision-making. When there is clearly definition of roles for different layers, decision-making becomes easy. Managers can for example, offer timely decisions in times of crisis, instead of waiting for the President to make a final decision. An authoritative leader can therefore act promptly without seeking further input. This is crucial when a company has to make urgent resolutions. In the same line, there is minimal questioning of directives as they come from the CEO or the owner of the company.
While most companies in the world embrace hierarchical structures of management, this approach has a range of drawbacks. For instance, it can create a huge gap between the managers and employees of the firm. This can be of great concern in small organizations, which heavily rely on involvement of both employees and top managers. When leaders or managers in an organization wield excess authority, power, which could be harmful to the business, is likely to set in. Consequently, leaders may ignore internal input from the lower employees of the company. In extreme cases, this kind of power could breed corruption, as managers do not acknowledge internal oversight from the employees of the company.
A hierarchical organization also has limited teamwork, yet this is an essential ingredient of successful management. The traditional hierarchical does not allow team-based layers in management in running of firms. Hierarchical approach creates divisions within the organization, which in turn hinders collaborative management. It also eliminates interaction between various departments of the organization. No company can realize successful performance when different departments are not in good terms. The collaboration is vital as it allows wide consultation and comparing of management notes to achieve a common goal.
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