Tuesday, October 6, 2009

Organisational Structure

Economist magazine have an article looking at the pros and con's of decentralisation.

Organisational structures have two basic frameworks - centralise or decentralise.

Centralise means services, choices, decision and strategy is dominated by those at the centre and their commands are carried out by the sectors.

Decentralisation means a lot of the decisions and operational choices are relinquished by the central powers, and the sectors choose how they want to carry out their duties.

In my current workplace I have seen the shift from one to the other (centralised to decentralised) and somewhat back again.

Interestingly those located in the center found it hard to relinquish the ability to make operational choices and stick to strategy.

At the same time the sub-sectors found the new power to make their own decisions hard to understand.

It has taken at least two years for the central point to be reached whereby - central decide the strategy, the sectors make operational decisions and everyone works together (somewhat to achieve the goals of the organisation.

There is no perfect organisational structure and tensions will always exist between the role of central services and how much power they should exude compared to how many decisions should the sectors be able to make?

Which do I prefer? Both and neither.

"A leader is one who knows the way, goes the way, and shows the way". (John C Maxwell).

Leadership, vision and strategy need to come from the center that shows the way yet allows people the freedom to make decisions.

1 comment:

  1. I am also working in an environment where there has been a shift in organisational structure. It can be a very difficult transition process to work through if you don't understand the bigger picture and what is really going on. Moving from a decentralised system and shifting back into a centralised structure can leave staff feeling like they've lost a lot of their autonomy.
    How do you think the models of collaboration vs. consultation work under these structures?


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