Organization’s Strategy and Structure
An organizational strategy is the sum total of expressions that envisions how the company will evolve with time in meeting its long term objectives coupled with a detailed assessment that informs the organization how the stakeholders will be organized to optimize the returns. Primarily, a strategic plan takes at least a year to be accomplished (Karami, 2012).
An effective organization’s strategy requires collaboration between all players in the organization. The top management is bestowed with the responsibility of formulating the larger organization’s strategy while the lower management’s work is to adopt the goals and establish a strategy of how the overall objective will be implemented chronologically.
The strategy according to Kortmann (2012) is derived from the organization’s mission and vision. The mission seeks to give a detailed exposition on why the company is in the business, and tends to influence the way activities will be organized in fulfilling its purpose. For the strategy to work effectively, the management has to break it into smaller manageable short-term goals with an aim of developing plans that will make the business competitive. Karami (2012) further argues that an organization’s strategy communicates ongoing activities and processes that the company will put in place to aid coordination and allocation of resources to assist in translation of the plan into results.
An organization structure on the other hand is a system that is used to define hierarchical organization of authority, communication infrastructure, and specific duties that the organization undertakes. It informs how power, roles, and responsibilities are assigned, coordinated, and communicated within the company. The structure of the organization is highly dependent on the organization’s objectives and the business strategy. In a centralized organization structure, the decision making organ lies in the hands of the top management unlike in the decentralized structure where power is distributed between the departments, and every person has an input in developing organizations plan.
The structure of the organization plays a phenomenal role in designing the job description of each employee and establishment of structures that promotes equality, professional development, and employee retention. The structure is also fundamental in creation of salary scales. This is achieved through aligning each job with a salary scale that will allow the organization to accomplish its financial goals through a fair allocation of funds within the budgetary limits. Kortman (2012) reiterates that a good organizational structure must be the one that creates room for future development and expansion of the company through exploration of new markets and seeking of new opportunities.
The degree of congruency between the business strategy and the structure plays a pertinent role in guaranteeing the success of the business since the two components are inseparable. Karami (2012) highlights that the business strategy is a plan of action of how the organization will accomplish its specified roles through effective organization of activities and adequate allocation of resources in ensuring that the business remains relevant. The structure of the business on the other hand informs how pieces of organizations plan will be fit together in enhancing operationalization of the company’s activities to achieve the intended objectives.
There is a need to develop a seamless relationship between the structure and the strategy because the structure helps the organization to establish a workable chain of command within which the information will be relayed from the management to the staff. Furthermore, a well-knit relationship between the two variables ensures maximum collaboration among employees to aid achievement of a common goal.
Karami, A. (2012).Strategy formulation in entrepreneurial firms. London: Ashgate publishing.
Kortmann, S. (2012).The relationship between organizational structure and organizational Ambidexterity: A comparison between manufacturing and service firms. London:Springer science &Business media.