Organisations are structured in such a way as to aid and control business activity. Typically business activity is organised around a systems approach in which inputs are converted into desirable outputs through business activity. The structure of the organisation is therefore organised to manage these activities to create the best possible results.
In modern production industries like the car industry, companies have developed structures whereby cells of workers combine in quality circles to take responsibility for the continuous improvement of production activities. This leads to the minimisation of waste and the maximisation of high quality outputs of motor vehicles. This is often referred to as the ‘kaizen’ approach taken from the Japanese word for ‘change for the better’ or ‘improvement’.
In modern service industries such as air travel, companies have organised their sets of processes including booking flights, passenger treatment in terminals and flight activities so as to focus on delighting consumers by providing a market focused experience. In public sector industries, the same picture emerges. For example, the Inland Revenue has recently been organised to take on a customer focused approach based on new team working and customer service management approaches.
Top down hierarchies
Many modern organisations have been restructured to develop customer focused teams as opposed to top down hierarchies, which are fast becoming a way of organising the past. However, top down hierarchies do have their place, especially when decisions have to be made quickly, for instance in times of recession or intense competition, so should not be looked upon as inherently bad.