Understanding Organizations

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Overview

A picture shows the feet of soldiers standing at ease. They are standing uniformly in a line, such that their shadows, which fall on their right, appear to be parallel lines.

Source: Michael Davis/EyeEm/via Getty Images.

Since the beginning of human existence, people have come together, combining their knowledge, skills, and abilities for the purpose of achieving a goal. If you think about the distant past, where families would cooperate as a community and form a clan or a tribe, each person being given a responsibility and answerable to the chief; the way people were organized, the structure, is very similar to what today we would call an organization. Over time, organizations have become more “organized” and developed to face the challenges of society. These changes have been driven by a desire to increase the efficiency of how we function and improve our quality of life. To define an organization, we could say it is a “goal-directed, boundary-maintained, and socially constructed system of human activity” (Aldrich & Ruef, 2006).

Today, we have a wide variety of organizations. Organizations such as governments and government departments, those setup for improving society such as non-government organizations and not-for-profit organizations, profit-driven organizations such as corporations and partnerships, and smaller organizations with a specific purpose such as sporting clubs, community groups, trade unions, and professional associations. A distinction that differentiates organizations from other collectives of people, such as families, is the goal-directed behaviors. The organization is established specifically to motivate the behavior of the individuals to reach the organizational goals. Another distinction between social groups and organizations is the people in the organization work toward a common purpose.

The way an organization is divided, the functions it undertakes, and how people are connected and interact with each other, is the organizational structure. The way an organization is structured is dependent on the organizational goals, the size of the organization, and how it operates.

Historically, the management structure of an organization has been hierarchical, with a small number of people at the top and the majority of people lower down. However, in recent years, there has been an increase in organizations flattening the structure through the removal of middle-level managers. An organization’s governing body is typically known as the board. The board is made up of people who are given the responsibility of making strategic decisions on the future direction of the organization and putting in place policies to meet the strategic intent. Another role of the board is oversight of the top-level managers, ensuring they are implementing the board policies and working toward the organizational goal. Below the top-level managers are the middle-level managers who mentor and monitor the managers below them, the first-level managers. The first-level managers are the supervisors of the general employees of the organization.

The structure of the organization and the management structure are established to enable the organization to meet its goal, but for an organization to be able to judge if the goal is being met, information is needed. We can argue that information is the lifeblood of the organization. Information flows throughout the organization, from top to bottom, bottom to top, and side to side. How the information is controlled is vital to ensure decisions being made are based on accurate data.

This skillset will provide you information on what organizations looks like, how they function, what is their purpose, and how they safeguard the integrity of the organization as a whole.

Further Reading

Aldrich, H., & Ruef, M. (2006). Organizations evolving (
2nd ed.
). SAGE Inc.
Barnard, C. I. (1938). The functions of the executive. Harvard University Press.
Greenwood, R., Oliver, C., & Lawrence, T. (2019). The Sage handbook of organizational institutionalism (
2nd ed.
). SAGE Inc.
Pugh, D. S. (Ed.). (2007). Organization theory: Selected classic readings (
5th ed.
). Penguin Books Ltd.
Scott, R. S. (2014). Institutions and organizations: Ideas, interests and identities (
4th ed.
). SAGE Inc.