Discuss Contingency approaches to organization design.
How to design an organization is a great deal of organizational structure. There are two theories regarding the organization design, these are universal approach and contingency approach. A universal approach is one prescriptions or propositions are designed to work in any situation. Otherwise, a contingency approach suggests that organizational efficiency can be achieved in several ways. In a contingency design, specific conditions such as the environment, disorganization work force and technology determine the structure.
Although each of these approaches contributed to the organizing process and the practice of management, it is argued that none of them is universally applicable. Several contingency designs attempt to specify the conditions, or contingency factors. The contingency factors include such thing as the strategy of the organization, technology, the environment, size of the organization or the social system within which the organization operates. There are a number of factors upon which design of an organization structure is based on. These factors are discussed below:
Size: Size is an important factor to design an organizational structure. The size of an organization can be measured in many ways. It is measured in term of its budget, total value of productivity or business, number of clients sewed, value of the organization’s assets. Larger organization have more complex organizational structures than smaller organization.
Technology: Organizational technology refers to the information and communication technologies that transform inputs into outputs. In small organizations the structure depend primarily on the technology, whereas in large organization coordinative activities may be more important.
Strategy: Strategy is the plans and actions necessary to achieve organizational goal. The structural necessities are environment, technology and size.
These are the three primary determinants of organizational structure.