Page 2: Organisational systems
In the most efficient organisations, all employees should know and understand their role and how it fits into the work of the organisation as a whole. They will also want to do the best that they can, not only in the interests of the organisation that employs them, but also in their own interest. With such a large and diverse group of employees operating in widely differing working environments, giving each of them a sense of belonging to a community with a common goal is a huge organisational undertaking.
Modern organisations like the Singapore Airlines Group need a structure that enables people to work and deal with one another in a co-ordinated and co-operative way as they work towards the goals of the business. An organogram is a chart that shows how an organisation is made up and how its systems fit together. Organisation charts help to distinguish between the levels of post as well as the layers of authority and responsibility attached to each post.
Dividing up an organisation
A very small business does not really need a formal structure and is unlikely to have one. As it grows, however, some sort of formal structure will be required. As it grows even larger, its ability to construct a proper organisational structure may well determine its fate. Departmentation is the process by which certain activities or parts of an organisation are grouped and then assigned to managers and other staff. How this is done depends upon a range of issues related to each organisation. Ideally, the chosen structure will:
- include every part of the organisation
- relate each part to every other part
- show where the authority and responsibility of different individuals and their departments lie
- enable everyone within the organisation to assess their roles and status.
There are five main methods of grouping different parts of an organisation.
These are by:
- Function - Dividing the organisation into broad sectors that reflect the specialism or function of each sector.
- Product - Basing the structure around products, with a different division for each type of product.
- Process - Creating a structure that mirrors the particular steps or phases of the production process.
- Geographical area - Relating parts of an organisation to the activities they provide for each geographical region.
- Matrix - Setting up a mix of the above methods.
When finalised, a company’s organisation chart will show:
- how various parts of the business are linked together
- the principal lines of decision-making
- the allocation of authority and responsibility.
Running a service business
Airlines operate in a competitive environment. A key area of competition for them is the quality of customer service. Customer service helps to distinguish one airline from another, and to give one an advantage over the other. In order to provide the type of service that customers want, airlines need to be flexible. They must allow employees scope to make decisions that take into account changing circumstances in a variety of environments. It is mainly for this reason that Singapore Airlines gives considerable autonomy to each part of the organisation.