THE FEDERAL POLYTECHNIC OFFA,

KWARA STATE

DEPARTMENT OF ACCOUNTANCY

HND II

PRACTICE OF ACCOUNT
ACC 419

TOPIC
ORGANIZATIONAL STRUCTURE

BY

GROUP 3
AC/HND/F21/6769 AC/HND/F21/6788
AC/HND/F21/6770 AC/HND/F21/6789
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AC/HND/F21/6776 AC/HND/F21/6795
AC/HND/F21/6777 AC/HND/F21/6796
AC/HND/F21/6778 AC/HND/F21/6797
AC/HND/F21/6779 AC/HND/F21/6798
AC/HND/F21/6780 AC/HND/F21/6799
AC/HND/F21/6781 AC/HND/F21/6800
AC/HND/F21/6782 AC/HND/F21/6801
AC/HND/F21/6783 AC/HND/F21/6802
AC/HND/F21/6784 AC/HND/F21/6803
AC/HND/F21/6785 AC/HND/F21/6804
AC/HND/F21/6786 AC/HND/F21/6805
AC/HND/F21/6787 AC/HND/F21/6806
SUBMITTED TO:

MR. LUKMAN ADEDOYIN

What is an organizational structure? Organizational structure is the method by which work
flows through an organization and allows groups to work together within their individual
functions to manage tasks
An organizational structure is a system that outlines how certain activities are directed in
order to achieve the goals of an organization. These activities can include rules, roles, and
responsibilities. The organizational structure also determines how information flows between
levels within the company
Organizational structure is a way or method by which organizational activities are divided,
organized and coordinated. The organizations created the structures to coordinate the
activities of work factors and control the member performance
TYPES OF ORGANIZATIONAL STRUCTURES
There are several different types of organizational structures are:
1. Functional Organizational Structure
2. Divisional Organizational Structure
3. Matrix Organizational Structure
4. Project team Organizational Structure
5. Network Organizational Structure
6. Flat Organizational Structure
Functional Organizational Structure
Functional Organizational Structures are best for small businesses because they allow for
clear decision-making hierarchies. Each team operates as an individual “silo.” Once teams
grow, they benefit from making these functional structures less rigid. Teams often move
faster and collaborate better with more overlap.

Functional organizational structure diagram

Matrix Organizational Structure
Employees work in both functional and project teams which may be structured differently.
Employees then typically report to two bosses: one who oversees their day-to-day work, as
well as another boss that oversees larger projects or tasks.

A project team Organizational Structure

Would include any number of functions working together on a specific project without a
permanent hierarchy. Employees report up through their individual bosses. But they also
contribute to team efforts led by managers from other departments on the team as needed.

Project team organizational structure

Flat Organizational Structure
Flat organizational structures have as little hierarchical structure as possible. Middle
managers are largely absent from staff. Instead, the workforce often reports directly to
managers or leaders at the “highest” level. Highly-autonomous employees often thrive in
these environments. The lack of hierarchy motivates people to make decisions, take
ownership, and facilitates problem-solving.

Network Organizational Structure

In a network structure, individual freelancers, groups, or associations work together. They
each work as separate functional teams, but may share an overarching entity. Professional
associations often have this type of structure

Element of organizational structure

Departmentalization: refers to how the organisation breaks down the functions and teams
needed to run the company and carry out the essential tasks.
Span of control: to identify the right span of control, you need to evaluate your leaders'
capacity, workplace size, and experience level of employees
Strategy: If management makes a significant change in its strategy, the structure will need to
be modified to accommodate and support such change.
Centralization within a business means that middle management does not have a significant
input to company decisions, and these are left to top level
Specialization: Work specialization gives employees specific duties and roles they are
expected to perform within the company, factoring in their qualifications and skills.
Accountability is the expectation that each employee will accept credit or blame for results
achieved in performing assigned tasks.
Organizing is a systematic process of structuring, integrating, coordinating task goals, and
activities to resources in order to attain objectives.
Authority: refers to the rights the upper level owns to instruct people to do the work well.
Responsibility
Hierarchy of authority is the control mechanism for making sure the right people do the
right things at the right time.
Coordination is the formal and informal procedures that integrate the activities performed by
separate groups in an organization.
FACTORS TO CONSIDER WHEN DETERMINE AN ORGANIZATIONAL
STRUCTURE
1. Service
The structure you choose will depend on the type of company you run. For example,
companies that rely on a number of front-line employees are structured a lot differently than
nonprofit organizations. Each will have a different organizational chart based on what they do
and where they need to prioritize their efforts.
2. Systems
Organizations at every stage — even with just one person — tend to organize their work by
function. There’s accounting, marketing, and service right from day one. When this work is
handled by a single person, there’s no need to articulate systems. More people means more
need to define how, when, and why teamwork happens.
Both the existing and desired systems play a role in organization structure
The importance of organizational structures
1. Organizational Structure is important for every business because it helps bring out a
homogeneity of function and administration across the organization.
2. It assists in handling the workforce efficiently and enables better coordination between
various divisions. Moreover, an organized structure helps deal with customer needs and
enhances the firm's revenues.
3. Organizational structures are important because they help businesses implement efficient
decision-making processes. By assigning specialized roles to lower-level employees,
businesses can make better decisions faster.
4. Putting an organizational structure in place can be very beneficial to a company. The
structure not only defines a company's hierarchy but also allows the firm to lay out the
pay structure for its employees. By putting the organizational structure in place, the firm
can decide salary grades and ranges for each position.
5. The structure also makes operations more efficient and much more effective. By
separating employees and functions into different departments, the company can perform
different operations at once seamlessly.
6. In addition, a very clear organizational structure informs employees on how best to get
their jobs done. For example, in a hierarchical organization, employees will have to work
harder at buying favor or courting those with decision-making power. In a decentralized
organization, employees must take on more initiative and bring creative problem solving
to the table. This can also help set expectations for how employees can track their own
growth within a company and emphasize a certain set of skills—as well as for potential
employees to gauge if such a company would be a good fit with their own interests and
work styles.
7. Additionally, organizational structures provide a clear org chart that helps businesses
keep track of their human resources. When your company is small, it’s hard to imagine
that you’d ever lose track of what everyone is doing. After all, in startups and small
businesses, it often feels like everyone is doing everything.
8. An organizational structure helps you identify gaps in skills and support within your
business. People’s roles become more specialized and individual teams grow bigger.
Revisiting the allocation of work prevents the duplication of effort and reflects business
priorities.
ADVANTAGES
Specialization
The most obvious advantage of a functional organization is that grouping employees by
specialization ensures a dependable level of departmental competence.
Operational Speed
A related benefit of this kind of organizational specialization is operational speed. By and
large, a senior tech is going to handle a support problem faster than someone with less
experience. There're probably going to train new staff members faster, too.
Operational Clarity
Segregating the workforce according to function clarifies organizational responsibility and
allocation of tasks. This tends to eliminate duplication of assignments that waste time and
effort and makes it easier for management to direct work to appropriate employees.
DISADVANTAGES
Segregation
Having departments populated by employees specializing in specific work areas means that
teams become siloed. Employees in different teams do not get the opportunity to meet and
share perspectives, which can be harmful for the progress of the business in the long run.
Weakening of Common Bonds
Having a common organizational purpose improves employee morale and performance and is
an important predictor of organizational success. When each group of specialists in a
functional organization is relatively isolated, the common bond that emphasizes a single
overarching organizational purpose is almost inevitably weaker than in an organization where
different kinds of employees regularly interact.
Lack of Coordination
In a perfect functional organization, each group's tasks would require no input from other
functional groups, but this is often not the case. As communication becomes increasingly
dominant in organizations, isolated groups may underperform or even fail because they have
no institutionally recognized way of communicating needs and issues to other functional
groups that might have helped.
In some instances, managers of other functional groups may not respond helpfully or in a
timely way because "it's not our problem." By the time the need for cooperation has been
established, the moment when cooperation would have been most effective may already have
passed
Territorial Disputes
A further disadvantage of a functional organization closely related to the failure of functional
groups to cooperate with one another is the possibility of territorial disputes. These disputes
may have to do with disagreements over goals, budgetary competition or any number of
issues that stem from a clash of egos that occur when each department has its own separate
functional structure or where a strong sense of a common purpose is lacking.