jin12kim

Organization Structure – Traditional and Boundaryless Structures

Posted on: June 27, 2011

When considering the efficient use and allocation of resources, companies are careful when deciding about corporate structure. Most companies I have worked with have a traditional organizational structure. The website, Group A-Plus (2005), indicates that “[t]raditional designs include simple structure, functional structure, and division structure”. The site author defines each traditional structure and provides examples of the structures. The summary is as follows:

Simple Structure:

“A design with low departmentalization, wide spans of control, centralized authority, and little formalization” (Group A-Plus, 2005)

Most small businesses consist of this structure having an owner and a few employees.

Functional Structure:

“A design that group similar or related occupational specialties together” (Group A-Plus, 2005)

Ex) Revlon: The company has departments in operations, finance, human resources, and product research and development that are responsible for different tasks.

Divisional Structure:

A group of “separate, semi-autonomous units or divisions” (Group A-Plus, 2005)

Ex) Wal-Mart: The company has different divisions such as Wal-Mart Reality, Wal-Mart International, Wal-Mart Specialty Store, Sam’s Club and Supercenters.

Each division has own goals and responsibilities to accomplish.

I have worked in a small company with a simple structure. Because there are only few people working, each employee learns multiple job functions and performs various tasks. I was responsible not only for the bookkeeping, but also consulting customers. Even though some jobs are distinguished, it is not clear. So I sometimes feel like everyone is doing everyone’s job. Then is it the same as an organization without boundaries?

Danna Griffin (n.d.) illustrates boundaryless organizations “transcend the rigid lines of bureaucracy and divisional boundaries within a corporation and ignore the borders where the corporation itself is separated from its markets, customers and ‘shareholders'”. Without boundaries, employees, managers, customers, and suppliers can achieve greater integration and coordination.

Talya Bauer and Berrin Erdogan (n.d.) divide Boundary less organizations into two forms; modular organization and strategic alliances. In the article (Beauer & Berrin, n.d.), they define the modular organization is “where all the nonessential functions are outsourced”. The example of the company form is Toyota. Suppliers work as the small divisions of the company. This structure helps to make an efficient and effective operation. Another form is a strategic alliance. The structure is described as “similar to a joint venture, two or more companies find an area of collaboration and combine their efforts to create a partnership that is beneficial for both parties” (Beauer & Berrin, n.d.). An example of its structure is a partnership with Starbucks and PepsiCo Inc. These two companies cooperate with each other for marketing and distribution.

I worked in a simple organizational structure, so I am curious about boundary less organization. Jodi Barnes Nelson (1997) illustrates that employees have “flexible hours and more control over where they work, how they work, and which projects they would most prefer” in a boundary less structure. I believe that in order to work in the structure, employees should have self-motivation and self-discipline. There is a lot of freedom, but there are still duties and responsibilities. Having no boundaries does not mean that jobs are neglected. Which kind of operational structure do you want to work in? Do you want to work in a company with boundaries or one with no boundaries? I am a self-motivated person, so I want to experience the boundary less structure and compare it with the traditional organizational structure.

 

References

Bauer, T.,& Erdogan, B. (n.d.) Organizational Structure. Organizational Behavior V1.1. Flatworld Knowledge. Retrieved June 25, 2011, from http://www.flatworldknowledge.com/pub/organizational-behavior-v1.1/141449#web-141449

Griffin, D. (n.d.) The Structure of a Boundaryless Organization. The Houston Chronicle. Retrieved June 25, 2011, from http://smallbusiness.chron.com/structure-boundaryless-organization-2764.html

Group A-Plus (2005), Types of Organization Designs. May Lilly. Retrieved June 25, 2011, from http://www.emaytrix.com/mgmt307/section3.php

Nelson, J. (1997). The Boundaryless Organization: Implications for Job Analysis, Recruitment, and Selection. Human Resource Planning, 20(4), 39-49. Retrieved from EBSCOhost.

Image source:

http://www.usvigers.com/About_GERS/OrganizationalStructure.aspx

 

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4 Responses to "Organization Structure – Traditional and Boundaryless Structures"

Hey Jin, good post! I also did my blog on the organizational structure and the three types. Although I did not consider the opposing boundary and boundary-less workplaces, I can definitely provide some insight. Due to the fact that I have only ever worked in organizations with boundaries, my opinion may come off as being biased. If I had the opportunity to work for a boundary-less organization, I would not hesitate. I think the idea of allowing the employees to develop individually and reach their full potential without restrictions is ideal. It seems like you have been restricted by certain boundaries and want to go beyond. Do you think this will be a possibility, or will these boundaries be pressing for the foreseeable future? In my research for my blog, I came across a book by Ron Ashkenas called “The Boundaryless Organization: Breaking The Chains Of Organizational Structure” that describes how the bridge to a boundary-less workplace is in fact plausible. A link to the online book can be found on my last blog. Feel free to take a look and let me know what you think.

Thanks,

Jory

Thank you for reading my post. I also when your blog and write yours. Your suggestion for the boundaryless organization is interesting and providing more depth of the topic. I appreciate your suggestion it was helpful to understand the structure. So, you would like to work in the boundaryless organization. I also believe that without boundary employees would have more freedom and control to perform jobs. However, I believe that the person should be self-motivated and responsible in order to perform fully. What do you think?

Yes, I do agree that most small business contains the traditional structure which I did write on my blog too, and this structure design is usually low in departmentalization, wide spans of control and centralized authority which is usually is the manager who holds these power and with little formalization.

Not only the boundaryless organizations will benefit employees, managers, customers, and suppliers with greater integration and coordination, but it will be more efficient for most companies in work wise because everyone is able to do or know how to do the same duties, so if one person is missing, then the company can just promote the next person into the missing position and do their work. However, the downside is that everyone’s position in the company will probably look the same and it is hard to distinguish the power or position.

For myself, I would prefer boundary organization to keep myself on track because I find myself easily getting distract by other things around the environment. Also, I prefer to work in traditional structure organization, so at least the power is more layer out. I would not have to question myself where do I stand in the organization and what I can do and what I cannot.

I also would like to work in traditional organizational structure. Companies (such as Apple, Google, etc.) need for innovative ideas should consider the boundaryless structure, so the employees could generate and think new idea without any obstacles. What do you think? You mentioned that you would like to work in boundary and traditional organizational structure. I believe boundary structure and traditional are similar, just different wording. Both would live straight policies or processes to keep and follow. However, boundaryless does not have those. There are more freedom and control to employees. Everyone likes freedom and control and believes he or she will perform in the best with boundaryless condition. But do they always? It depends….

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  • Jory Grunlund: Hey Jin. Similar to what I told Chris, people are usually resistant to change at first. Like you mentioned, when your accountant changed the accountin
  • irenechou1: I guess everyone are scared of being changes because there are so many factors that you could not predict after the changes are applied in an organiza
  • chrisjerickchua: Hey Jin, I completely agree with you that as the world changes, organizations need to change as well. Organizations cannot stay stagnant or else th

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