2.2. Owing to rapid changes in the environment (IT, globalisation, customer needs, etc.), modern
organisations need to be flexible in order to accommodate the changes.
2.2.1. Describe the characteristics of traditional and modern organisations designs.Using the following characteristics.
Traditional (Mechanistic)
– Bureaucratic
– Rigid
– Relies heavily on function and division
• Contemporary/ Modern (Organic)
– Fluid/ flexible (adapts easier to environmental changes)
– Fewer rules and procedures
– Decentralised decision-making
Traditional (Mechanistic) Organizational Design:
- Bureaucratic: Traditional organizations have a strict hierarchical structure with clear lines of authority and a top-down decision-making process. Decision-making authority is concentrated at the top levels of the organization.
- Rigid: Traditional organizations have a rigid structure and are resistant to change. They have established procedures and processes that are followed strictly, and any deviation from these processes is not encouraged.
- Relies heavily on function and division: Traditional organizations are organized according to functional departments or divisions. Each department handles a specific aspect of the organization's operations, such as finance, marketing, or production. Communication and coordination between departments are often limited.
Contemporary/ Modern (Organic) Organizational Design:
- Fluid/ flexible (adapts easier to environmental changes): Modern organizations are designed to be flexible and adaptable to changes in the environment. They have a flatter structure with fewer hierarchical levels. This allows for quicker decision-making and greater agility in responding to the rapidly changing business landscape.
- Fewer rules and procedures: Modern organizations have fewer rigid rules and procedures compared to traditional ones. There is more emphasis on autonomy and empowerment of employees. This allows for creativity, innovation, and flexibility in problem-solving and decision-making processes.
- Decentralized decision-making: Modern organizations decentralize decision-making power. Authority is distributed among lower-level employees and teams, enabling them to make decisions more autonomously. This not only speeds up the decision-making process but also fosters a sense of ownership and responsibility among employees.
Overall, modern organizational designs prioritize flexibility, adaptability, and decentralization of decision-making, while traditional designs emphasize stability, structure, and centralized control.
In traditional (mechanistic) organizational designs:
1. Bureaucratic: Traditional organizations have a hierarchical structure with clear authority and control. Decision-making is generally top-down, with a focus on following rules and procedures.
2. Rigid: Traditional organizations tend to have rigid structures and processes that are resistant to change. There is little room for experimenting or adapting to new challenges and opportunities.
3. Relies heavily on function and division: Traditional organizations are organized based on functional specialization and division of labor. Each department or division has its own specific responsibilities and tasks.
On the other hand, in contemporary/modern (organic) organizational designs:
1. Fluid/flexible: Modern organizations are designed to be more adaptable and flexible to accommodate rapid changes in the environment. They are quick in responding to new trends, technologies, and customer needs.
2. Fewer rules and procedures: Modern organizations have fewer strict rules and procedures compared to traditional ones. There is more freedom for employees to make decisions and take initiatives, fostering creativity and innovation.
3. Decentralized decision-making: In modern organizations, decision-making is often decentralized. Instead of relying solely on top management, decision-making authority is delegated to lower-level employees, empowering them to make decisions based on their expertise and understanding of the situation.
Overall, modern organizations are characterized by their ability to embrace change, be flexible, encourage innovation, and empower employees to contribute to decision-making processes.
To describe the characteristics of traditional and modern organizational designs, we will compare the features of traditional or mechanistic organizations and contemporary or modern organizations.
Traditional Organizations (Mechanistic):
1. Bureaucratic: Traditional organizations tend to have a hierarchical structure with a clear chain of command. Decision-making is typically centralized at the top levels, and employees have limited autonomy to make decisions.
2. Rigid: Traditional organizations have rigid structures and processes, characterized by strict rules and procedures. There is little room for flexibility or adaptation to changing circumstances.
3. Relies heavily on function and division: Traditional organizations are organized based on functional departments or divisions. Each department operates independently, focusing on its specific tasks or goals. Communication and coordination can be slow across different departments.
Contemporary/Modern Organizations (Organic):
1. Fluid/Flexible: Modern organizations are designed to be adaptable and flexible in response to rapid changes in the environment. They can adapt quickly to market trends, technological advancements, and customer needs.
2. Fewer rules and procedures: Modern organizations emphasize autonomy and empowerment. They have fewer rigid rules and procedures, allowing employees to take ownership of their work and make decisions independently.
3. Decentralized decision-making: In modern organizations, decision-making is decentralized and distributed across different levels and teams. This allows for faster decision-making and encourages innovation and collaboration.
To understand the characteristics of traditional and modern organizations, you can analyze the structure, processes, and culture of organizations. Look for signs of hierarchy, bureaucracy, rigid processes, and centralized decision-making for traditional organizations. On the other hand, modern organizations typically prioritize flexibility, autonomy, fewer rules, and decentralized decision-making. You can obtain this information by researching organizational design principles, studying case studies, or analyzing real-world organizations.