Organizational Structure Comparisons Find two organizations that provide the sam

Question

Organizational Structure Comparisons

Find two organizations that provide the same or similar products or services. One of these organizations should be a large organization and the other should be a small organization. Identify how each is structured and how effective you believe the structure of the organization is in the areas of work specialization such as departmentalization, chain of command, span of control, centralization or decentralization and formalization. Explain which work specialization area you would prefer to work for and provide details to support your answer.

Explanation / Answer

I would like to explain this with the help of two organizations which are in the service industry:

Accenture: Big Organization

Ivy: Small Organization

Let me explain how the key parameters indicated in the question are at Accenture:

Departmentalization: Accenture is very specific in terms of departments. In big organizations, you have verticals which are organized around the various domains that they have clients in. For example, Accenture could be having clients in Banking, Finance, Agriculture, etc. The various departments and functions are all designed around these domains. There are also formal departments such as the purchase department, project management department, etc.

Chain of command at Accenture is typically vertical, as it is in any big organization. You have a vertical hierarchy annd not a flat hierarchy. For example, you might have: President -> Vice President -> Senior Manager -> Manager -> Analyst. This might be a typical chain of command at this organization

Span of control can range between 10 to 100. Managers (middle level) can sometimes handle 100s of engineers/fresh trainees, and in such cases the span of control (the number of people directly managed by a manager) can go up.

There is heavy centralization of work in Accenture (standardisation)

Now, let me explain the culture at Ivy, which is a small startup:

The departmentalization here is informal. While there are basic departments such as the HR function, sourcing function, IT team, there is no formal categorization based on the domain. You have a pool of talent which is available for the organization to draw from in an agile way.

The chain of command here is flat - you have a flat hierarchy as compared to a vertical hierarchy in bigger organizations. You might simply have a Presidet -> Head -> Consultant. Multiple layers of hierarchies are removed.

Span of control in smaller organizations typically range from 8-10, sometimes they even rest at 2-3

The work here is decentralized and there is less of formalization.

This is the key difference in terms of the parameters asked in the question - I have selected one established organization and one start up so that you can appreciate the differences.

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