What is Structure?

Part 3 of the book looks at structure, what the means for innovation and what reasonable expectations can we have about the behaviour of the organisation knowing it's structure. But before getting ahead of myself it's worth spending a few moments understanding what I mean by structure. 

This section below is taken from the start of Chapter 8. Upon re-reading it, I find it very analytical ... as is my nature. The case study that follows is far more engaging and it occurred to me that this chapter (and in fact part 4 of the book as a whole) might be better served with the engaging material first. Perhaps I'll post the case study next week.

What do you think? Should I restructure Chapter 8?

Anyway, here's start of Chapter 8 ...

What is structure?

Organizational structure is the framework that defines how an organization operates, how roles and responsibilities are distributed, and how decisions are made. It shapes the flow of information, the distribution of power, and the relationships between individuals and teams. In essence, structure is the backbone of an organization, determining its ability to execute strategies, adapt to change, and achieve its goals (Mintzberg, 1979).

In this chapter, we will explore the concept of organizational structure, its key components, and how it influences an organization’s capacity for innovation, decision-making, and long-term sustainability. We will also examine how different types of structures—hierarchical, flat, matrix, and decentralized—impact organizational behavior and outcomes.

"Structure is not an organization. It is the anatomy of an organization, the skeleton that holds it together.” - Henry Mintzberg

The Components of Organizational Structure

Organizational structure is composed of several interrelated elements that work together to define how an organization functions. These components include:

Hierarchy and Reporting Lines: Hierarchy refers to the levels of authority within an organization, from senior leadership to frontline employees. Reporting lines define who reports to whom and how information flows up and down the chain of command. In hierarchical structures, decision-making authority is concentrated at the top, while in flat structures, authority is distributed more evenly across the organization (Galbraith, 2014).

Division of Labor: This refers to how tasks and responsibilities are divided among individuals and teams. In functional structures, employees are grouped by their expertise or department (e.g., marketing, finance, operations). In cross-functional or team-based structures, employees from different disciplines work together on shared goals (Mintzberg, 1979).

Communication Pathways: Structure determines how information is shared within an organization. In centralized structures, communication often flows through formal channels and is filtered by layers of management. In decentralized structures, communication is more direct and informal, enabling faster decision-making and collaboration (Edmondson, 2012).

Decision-Making Processes: The structure of an organization dictates who has the authority to make decisions and how those decisions are made. In hierarchical organizations, decisions are typically made by senior leaders, while in decentralized organizations, decision-making authority is distributed across teams (Kotter, 1996).

Coordination and Control Mechanisms: These mechanisms ensure that different parts of the organization work together effectively. They include policies, procedures, and systems for monitoring performance, allocating resources, and aligning efforts with strategic goals (Galbraith, 2014).