Flexible Organizational Structure

Traditionally, organizational designers built companies as machines, strictly controlling inputs such as work in order to get reliable outputs.This meant a rigid organizational structure, with clearly defined and specialized job positions. Many rules helped ensure smooth operations, requiring strong chains of command and many managers. These measures gave these mechanized companies the advantages of efficiency, economies of scale and the ability to standardize and mass produce. Downsides included a loss of flexibility and responsiveness. Flexible structures were developed for those companies willing to trade some of the advantages of traditional structures for a more responsive company.

The opposite of a mechanized structure is, of course, an organic structure. Organic organizational structures can adapt and evolve in response to the environment. This changeability gives organic structures an element of impermanence. Evolutionary adaptability also means that organic structures call on employees to create and innovate to meet the challenges of the market environment. Employees challenged to contribute this way become more invested in their jobs and have higher morale than their peers in mechanized environments.

A key characteristic of flexible organizations -- and one of the reasons for that flexibility -- is flatness. Flatness refers to a lack of management layers, layers that make other organizational structures tall. The bureaucracy of the more mechanistic structures slows down decision-making, hampering agility. Eliminating the bureaucracy fixes the problem and flattens the organizational structure. Without middle management, employees must be more self-reliant. Flat structures distribute decision-making power to employees, which increases the responsiveness of the organization as a whole.

On the continuum of the most rigid and mechanized organizational structure to the loosest and most organic, the network structure is the most organic. Also called a virtual organization, this structure relies on external companies to perform much of the company’s work -- work that in a traditional company would be done in-house. The true company is actually only a small management group with support staff. The freedom to hire or fire outside companies to fulfill business functions such as production, shipping or marketing gives the network structure its flexibility.

Next to the network structure, the team structure is the most flexible organizational structure. The organization is built on employee teams who contribute expertise to particular goals or work processes. Team members bring different skill sets to the group, and when decisions must be made, the team member with the understanding and expertise relevant to the issue holds sway. The employees, thus, mostly lead themselves, with perhaps only one manager or an owner overseeing many teams. Without bureaucracy standing in the way of innovation, the teams can respond with speed and flexibility to the needs and demands of the market.