This paper deals with the aspect of Organizational Structure. The organization structuring of any organization is concerned with certain critical matters, such as:
- Centralization and Decentralization
- Tall and Flat Structures
- Span of Control
- Unity of Command and Chain of Command.
The Model Company for this paper is one of the leading automakers in the world, Toyota Motor Corpn. Japan.
It is seen how these factors influencing the working of Toyota Corpn in as much as organizational structures are concerned.
Centralization and Decentralization
It is seen that Toyota is a highly decentralized company and authority, powers relating to delegation of authority and responsibility, permeates down the organization. It is seen that workforce has wide authority to make decisions in their sphere of work activity in coordination with team leaders, or supervisors. It follows an informal chain of command system where the emphasis is laid on the techniques and methods of working, more than the results, or work output. At Toyota, the throughput aspects are as important as the output from the final assembly line. “Toyota engineers ‘average’ and ‘level’ production allows the lines to co-ordinate output without building inventories. They compare assembly to rowing a boat, everybody has to be pulling on the oars at the same rate.” (Aswathappa 2006).
Tall and Flat Structures
Another aspect that impinges upon organizational structure is the tall and flat structure feature which refers to the levels of authority and its span of authority in an organization. The larger the number of authority levels, the taller the organization; similarly the lower the authority levels or echelons, the flatter it is said to be. Toyota Motors are in the former, tall structure category since there are quite a few formal and informal hierarchies in the business which may be covert, and not very evident.
At Toyota, all members of the workforce are fully aware of their functionings and their strategic roles in the overall structure of the enterprise and are fully geared to organizational goal seeking. “Toyota has a unique organizational structure on the shop floor and a similar structure in engineering and support groups. There is a group leader (salaries in manufacturing) who has a team leader (hours in manufacturing) as direct reports.” (Liker and Meier 2007).
As is typical of any organization it is seen in Toyota that with a tall structure, the span of command and control increases and it is highest at the lowest echelon.
“Generally, a taller organization, with its narrower span of control, allows for closer control of supervisors in that supervisors have more time to devote to monitoring fewer individuals. Therefore, tall organizations tend to discourage decentralization, while flat organizations are more predisposed to use decentralized decision making.” (Vecchio 2006).
Span of Control
It refers to the number of people who are under the control of executives, and who report to him on work-related issues. It is believed that the wider the span of control, the more positive outcomes could be reached, especially at lower levels where the workforce is performing the more or less identical type of works, and thus a larger number of workers could be simultaneously supervised. However, very much in the lines of the Toyota system, a large span could be created, in which informed leaders are employed, who report to the Unit leader.
The length of the span of control could be lowered or increased, depending upon work demands, while all along, also maintaining an informal work system. ‘The test of organizational enterprise is that members across the firm must be involved in creating “something different” and that the organization must sustain such effort again and again.’ (Litterer and Jelinek 1995).
Unity of Command and Chain of Command
The final aspect that binds organization structuring is in terms of the unity of command and chain of command.
The unity of command doctrine propounds that each subordinate should have only one superior to report to, and (s)he needs to obey the orders of just one authority. The idea behind the unity of command is that numerous superiors for a single subordinate vitiates the work atmosphere and creates more unproductive work than fruitful exertions.
Moreover, the subordinate would be at a quandary to decide, at the risk of his own employment, whose orders to honor and whose commands to reject.
In the Toyota setting, it is seen that the team supervisor has team leaders under their command. The team leaders create informal unity of command among the working staff who are informally instructed and guided by them. All problems and issues are attended to by the team leaders, failing which the matter is referred to the team supervisors. Since most issues are ironed out at the incipient stages, the Toyota manufacturing system is a model for most automakers, and many later car manufacturers have adopted the Toyota method with a great degree of success. Constant Improvement is an obsession at Toyota and each member of the workforce works to increase performance through improvement. (Bowen and Spear 1999).
Chain of command on the other hand refers to the flow of information and authority within the organization. Authority is flowing downwards and accountability flows upwards. It is seen that the chain levels of work delegation need to be smooth and uninterrupted, with intermediate levels also considered, which would contribute to the overall harmony and development of the company. This is actively practiced in the contest of Toyota also and is one of the chief causes for Toyota’s phenomenal success in the auto world.
Bibliography
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