Organizational Structure - Paper Example

Organizational structure is important in any organization. However, the most important thing is for the organizational structure of the company to align with its strategy. An organization strategy is away the business would use its resources to ensure they reach specific goals in terms of dealing with their clients and vendors. Organizational structure, on the other hand, is about hierarchy, and the way employees in that hierarchy work together to achieve a common goal. An enterprise, which aims to achieve long-term productivity, would lay a strong foundation that would inhibit task overlap. In light of that discussion, it is apparent that it takes the right of structure for a strategy to succeed. The paper supports the thesis that it is important for an organization to have alignment between its strategy and structure because both aspects increase the firm's competitiveness.

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Importance of an Organization to have Alignment between its Strategy and Structure

It is important for an organization to have alignment between its strategy and structure because both aspects increase the firm's competitiveness. Rothaermel (2017) introduces a discussion of organizational design, which creates the structure and eventually allows managers to create an achievable strategy. As the author explains, if a company is unable to implement an effective strategy, then it would lose its competitive advantage.

Before strategy implementation, change is important for the firm. Rothaermel (2017) affirms that a strategy implementation might fail because the manager failed to make necessary changes in regard to resource allocation and power distribution. Ajagbe, Bih, Olujobi, and Udo (2016) indicate that the manager has to first define the firm's strategy before shifting to implementation. According to Rothaermel (2017), the structure must be flexible to accommodate a structure that would result in growth and expansion, and eventually improve performance. In his research, Kavale (2012) finds a connection between organizational structure and strategy to performance. Notably, these aspects would increase a firm's competitiveness. He introduces the concept of organizational inertia, which occurs when the structure fails to accommodate the strategy. As he indicates, a complete optimization of the structure is necessary to create a strategy.

Organizational structure involves elements such as specialization, formalization, centralization, and hierarchy (Rothaermel, 2017). As the author adds, these elements have to be integrated to ensure the firm improves. This performance is what would increase a firm's competitiveness in the market. He indicates that different stages in a business's growth require different organizational structures, which can range from simple, functional, and multi-divisional. Even so, Ajagbe, Bih, Olujobi, and Udo (2016) assert that if the organizational structure is matched with organizational strategy properly, the outcome is always positive performance.

Conclusion

The structure is the one, which enables the top management to design a viable strategy, which would help the firm to conduct its daily operations with ease. The top management should be vigilant to ensure that the strategy they have laid out is beneficial to the organization. As discussed, before the strategy implementation, the management has to ensure that the organization has undergone a complete change and the changes should support the strategy. Seemingly, strategy implementation is crucial to any firm because it would result in its long term productivity. In the paper, a relationship between organizational structure and strategy is established. The paper determines that structure must support the strategy for performance and competitiveness to be substantiated. Overall, organizations should revise their structures to align with its strategy to improve efficiency in competitiveness.

References

Ajagbe, M.A., Bih, J., Olujobi, J.O., and Udo, E.E. (2016). Which Precedes the other? Organizational Strategy or Organizational Structure. IIARD International Journal of Economics and Business Management, Vol. 2 No.6.

Kavale,. (2012). The Connection between Strategy and Structure. International journal of business and commerce. 1. 60-70.

Rothaermel, F. T. (2017). Strategic management concepts (Custom 3rd ed.) New York, NY: McGraw-Hill.