4 Objectives and Importance of

Organisational Design
By Smriti Chand
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The four objectives of organisational design are briefly discussed in the following
paragraphs:
Responding to change:
Nothing lasts forever, Change is inevitable, Either change or perish, Change is the only
thing that is permanent these could be the slogans of organisational designers.
For a firm to remain competitive, it must respond to changes in the environment competition,
technology, global economy and consumer needs as well as the changes that emerge from the
companys evolutionary development and proactive initiatives.
Integrating new elements:
As organisations grow, evolve, expand and respond to changes, many new positions and
departments will have to be added to deal with factors in the external environment or with new
strategic needs. These new elements will have to be integrated into the overall structure of the
organisation which means virtually restructuring the organisation. For instance, the strategic need
to enhance quality of customer service may need dismantling of functional departments, creating
teams and re-delegating authority.
Coordinating the components:
After creating new departments, managers need to find a way to tie all the departments together
to ensure coordination and collaboration across the departments. The departments have to work
together either through reporting relationships, cross-functional teams or task forces in order to
avoid conflicts and problems and to meet customer needs.
Encouraging flexibility:
Organisationai designers want to build into the organisation with all its authority, chains of
command, bases of departmentalisation flexibility for decision making, for responding and
redirecting resources and for focusing employees talents this objective differs from that of
responding to changes.
The Importance of Organisational Design:

Increased global competitiveness and increasing use of advanced information technology has
made organisational design as one of managements top priorities in the present business
environment. Managers of today are under pressure to search for new and better ways to
coordinate and motivate their employees to increase the value created by their organisations.
Organisational design has major implications for an organisations ability to deal with
contingencies, achieve competitive advantage, effectively manage diversity and increase its
efficiency and ability to innovate new goods and services.
The design of an organisation determines how effectively an organisation responds to various
factors in its environment and obtains and makes use of the scarce resources it has. An
organisation can design its structure to increase control over its environment.
More effective types of structures are developed to respond to the increasing pressures from
competition, consumers and the government which will make the environment more complex
and difficult to respond to. Organisational design becomes more important in a global context
because to become a global competitor, a company often needs to create a new structure.
Changing technology also puts pressure on organisations to respond.
For example, today the emergence of Internet as an important new medium through which
organisation manage relationships with their employees, customers and supplies is fundamentally
changing the design of organisational structure (for example call centers and back offices).
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