Mechanistic Management Structures

Organizational-structure characterized by centralization of authority, formalization of procedures and practices, and specialization of functions. Mechanistic organizations are comparatively simpler and easy to organize, but find it difficult to cope with rapid change. Compare with organic organization. Haier is following mechanistic structure in their organization. However, mechanistic structures may act as an effective and efficient organizational structure for companies operating in a more stable and certain environment. Companies operating in a stable environment may not need to make decisions quickly. Likewise, many of the day-to-day decisions and operating procedures may be formalized and centralized, because there is no inherent need for constant change or innovation. Some fractures of Mechanistic structure are Stable environment: This organizational structure works best when the environment is relatively stable. Low differentiation of tasks: Tasks will not be differentiated much, because each subtask is relatively stable and easy to control. Low integration of e.g. departments and functional areas: Due to the stability of tasks, there will be low integration between departments and functional areas, because tasks stay relatively stable, and because the functional areas are not heavily dependent on each other. Centralized decision-making: When the environment is stable, there is no need for complex decision-making that involves people at lower levels. Therefore, decisionmaking is centralized at the top of the organization. Standardization and formalization: When tasks are stable, tasks should be standardized and formalized, so that operations can run smoothly without breakdowns.

There are some problems and some advantages as well, because of this structure. These are as follow : Advantages Mechanistic management structures are used in environments where there is high complexity in the tasks undertaken by the organization. Each employee specializes in a particular task and makes only a small contribution to the companys final output. Emphasis is placed on improving technical processes and senior managers decide how work will be accomplished.

Disadvantages The mechanistic management structure is very rigid and slow to adapt to changing environmental conditions. The structure is also not suited to turbulent or highly competitive market conditions such as those found in the telecommunications industries. In addition it should not be used when the majority of the staff is highly skilled professionals, such as in an international auditing firm.