Establishment, Categorization, and Structure of Organizations
Formation of Organizations
There are various reasons why organizations are formed. Kandogan and Hiller (2018) explain that one such reason is the culmination of skills and efforts to achieve some set goals. Towards this end, organizations bring together different expertise to achieve a common goal. One can argue that individuals can still achieve their desired goals on their own. However, this might take longer compared to when an organization undertakes the same tasks.
An example can be used to explain this concept further. It would take one person approximately two days to move houses. However, it would take only five hours for a team of five people to move to the same house. The combination of skill and strength makes work easier. Additionally, the same group of people will finish the work at a much faster rate.
The second reason why organizations are formed is to lower the cost of doing business (Kandogan & Hiller 2018). There are two ways in which organizations can help lower transactional costs. The first is through the different departments and staff who work in the company. It is cheaper for an organization to have an in-house specialist than for it to outsource when the need arises. The second reason organizations lower transaction costs is the fact that the rates of acquiring goods and services are cheaper, and payment processes more flexible. Through proper procurement practices, organizations can choose suppliers they can afford and also take longer to pay off their debts than individuals.
On the same note, organizations are formed as they are more accountable than individuals. For instance, it is common for people to trust organizations that are legally registered, have a physical address, and have some staff compared to an individual working alone.
Categorizing organizations. Critics have come up with various ways of categorizing organizations. Three of the ways are formal and informal, centralized and decentralized, and public and private organizations. Formal organizations follow a strict and direct process line. Such organizations are keen on the organizational chart, structure, and guidelines. Each employee in the company has to learn and adhere to the guidelines.
Yang (2017) explains that formal organizations have rigid reporting and communication structures. This means that the employees have to follow a strict reporting procedure for both decision-making purposes and crisis management. The informal organization, on the other hand, is very flexible. Critics are now encouraging organizations to be informal in order to incorporate creativity and design thinking into problem-solving (Yang 2017).
The second mentioned categorization of organizations is the centralized and decentralized approach. Yang (2017) explains that a centralized organization focuses on the top tier of the management for all decision-making. The junior employees are not allowed to make any decisions and have to verify everything through their line managers and supervisors, who then have to also verify with other senior managers. The decentralized organization, however, is as flexible as the informal company. This is because the decision-making process in the decentralized company is devolved. It is common to find that verification of a decision only requires one superior that a junior employee can access at that time. Due to this, decision-making in the decentralized business is faster compared to the centralized organization.
The third categorization divides organizations into public and private entities. Yang (2017) confirms that public organizations are ones that are involved with the state or the government. They are rarely profit-making. Additionally, public organizations primarily serve the general population. On the other hand, private companies are profit-making and serve individuals or groups of individuals. Yang (2017) explains that public companies have often been accused of corruption and poor management yet have still survived due to being tied to the government.
However, private companies that have been poorly run usually end up bankrupt. There are companies that have both public and private features (Yang 2017). An example of a public company that is also run as a private company is the Abu Dhabi National Oil Company (ADNOC). Whereas the company is state-owned, it is a culmination of private energy companies in UAE (Abu Dhabi National Company 2017).
Erhardt and Harkins (2013) argue that there are six main types of organizational structures. The first is the functional structure, which groups staff according to the different departments. In this type of structure, employees are attached to different departments like communications, finance, IT, and administration. Such a structure encourages teamwork within the departments. However, as Erhardt & Harkins (2013) note, the structure can also encourage departmental wars as employees might work only to achieve departmental goals and not the organizations. Organizations can also be described as having a product or service structure.
As the name suggests, staff are usually divided based on a product or service. The example of ADNOC Sour Gas Company can be used to describe the product and service structure better. At ADNOC Sour Gas, the employees are divided mainly according to three main business elements (Abu Dhabi National Company 2017). The elements are marketing and distribution, processing and refining, and exploration and production (Abu Dhabi National Company 2017).
Organizations can also have a geographic structure. Erhardt & Harkins (2013) explain that this structure categorizes staff according to the region they operate. If the company has operations in different states, countries, or even continents, the structure can use its physical location to structure the company. The matrix structure gives each employee two reporting lines. For instance, a person in the marketing department doing administration work will report to the marketing manager and the administration manager as well. On the other hand, a company can also structure its employees into teams (project teams).
In such a structure, employees are tasked with different projects and are picked from different departments. These employees can be on the project either as full term, partial or short-term members. The project team members can sometimes have two reporting lines especially if they are on the project partially. Last but not least is the hybrid structure. According to Erhardt & Harkins (2013), this structure combines both the functional and product or service structures.
Using the PESTLE analysis tool, one can argue that one of the external factors that impact how an organization opens rates is the political influence. Using ADNOC as an example, one can argue that political goodwill (which is an external factor) affects how each member of the company relates to the state. This is due to the fact that the company is owned by the government, yet requires all energy companies to join as members.
External economic influence on open rates is inflation. A social element that can affect the open rates is the culture of the people. If the people are not technologically advanced then any tech product or service will take longer to penetrate the market. On the same note, technology affects the open rates as the ease of producing something makes it more affordable. This ease is highly supported by the right technology. The legal aspect goes hand in hand with the political aspect. For ADNOC, all companies involved have to follow all legal requirements by the government. One of the environmental factors that affect a company’s open rates is the product’s impact on the global climate. For ADNOC Sour Gas, the production of Sulphur can negatively affect the environment if not carefully monitored.
Positioning of Learning and Development in Organizations
Arrangement and Incorporation of Learning and Development
Böhlich and Oleti (2017) explain that proper arrangement of learning and development in an organization is essential for both staff motivation and higher productivity levels. One way to incorporate learning and development in an organization is through aligning it to the organization’s goals and objectives. The premise suggests that learning and development should also be incorporated into strategies and outcomes. Böhlich and Oleti (2017) argue that such an alignment will ensure that everyone knows the importance of learning and development. One of the biggest challenges of L&D in an organization is the uptake of the same among the staff. It is important for companies that include L&D in their strategies to also provide a conducive environment for learning.
A second viable way of incorporating L&D in an organization is through the use of free webinars by influential personalities. Trevitt et al. (2017) argue that traditional learning that involves attending classes for several hours is not a viable L&D approach in this day and age. Many of the employees will either reject or find other excuses not to learn using this traditional approach. The use of webinars by influential people will help develop a culture of L&D. This is specifically the case for organizations that have never had an L&D practice before, as the approach is learner-focused. Additionally, webinars can be accessed externally.
Factors That Affect Arrangement and Access to Learning and Development
One of the main factors that affect incorporation and access to learning and development in an organization is time management. Vey et al. (2017) admit that many employees find it difficult to juggle between learning and working. Often, one of the two activities lags behind and many times it is the learning aspect that is abandoned in favor of achieving work-related targets. On the same note, due to globalization, many employees find themselves traveling significantly for work.
This disrupts any type of learning and development exercises they might have prepared. Companies have come up with several solutions to the issue of time management in relation to learning and development. One crucial solution is the training of staff on proper time management. Secondly, businesses have invested heavily in online and long-distance learning for their staff. This ensures that staff can engage in learning activities anywhere and at any time they desire.
Personal goals and career growth also affect the incorporation of learning and development activities in an organization (Vey et al. 2017). It is important to note that if the learning and development objectives set by the company enhance the ability of the individual employee to achieve his or her own goals, then the said individual will willingly participate in the L&D activities.
Towards this end, the company has to package all L&D activities as crucial for personal career growth. It is also important for the L&D activities to be meaningful to the department and career path the individual wants to take. For example, L&D activities that involve technical finance will benefit employees in the finance department. However, offering the same course to staff in the communications department might lead to the rejection of future L&D activities.
L&D and the Achievement of Organizational Objectives
Services Offered by Learning and Development
One of the services offered by L&D is continuous professional development through relevant courses. It is the task of the HR department, which handles L&D, to pick relevant courses for the staff (Stephen 2018). It is important to note that each individual and each department will have different needs when it comes to L&D. To ensure that everyone’s needs are catered for, the Human Resource department has to do a survey on some of the things the employees would like to learn to enhance their performance levels.
This survey should be done per department. A customized course can then be drafted to ensure that each employee gets the skill and knowledge he or she desires. By doing so, the L&D activities will also be supporting the achievement of organizational objectives as it will give the employees the skills and knowledge needed to achieve the said objectives. Continuous professional development courses will target all employees.
Another service that can be offered through the L&D mechanism is proper human resource management. As stated, the HR department is tasked with handling all L&D needs in an organization. This means that the department has to be invested in both the employees and the organization. Additionally, the HR department has to ensure that the company has a conducive environment for learning for all employees. All these translates to better human resource management. One can argue that this service targets all employees within the human resource department. It is crucial for HR to also include itself in the L&D activities. Proper human resource management will aid an organization to achieve its goals as the staff will be inspired to accomplish tasks.
L&D and Organizational Objectives
Learning and development are crucial in attaining organizational objectives. One way it supports the achievement of the company objectives is through providing staff with the skills and knowledge needed to finish tasks. In business, the fastest and most efficient way of finishing a task is considered the best way. Staff can understand new concepts that can help them finish their tasks faster and more efficiently through learning. Additionally, the learning of new skills and knowledge will help staff think creatively and offer better solutions to some of the organizational problems.
It is also important to note that L&D can help achieve organizational objectives through the motivation of staff. Stephen (2018) explains that L&D benefits both the staff and the company. Whereas the company ensures staff has the right skills and knowledge needed to achieve objectives, the staff also get additional certificates to boost their resumes. This makes them more valuable to the company and to other future employers. To further motivate the employees, it is important for the company to promote employees who have been actively involved in the L&D activities. By doing so, the management will also encourage other employees to take some offered courses as well.
Abu Dhabi National Company 2017, About ADNOC sour gas. Web.
Böhlich, S & Oleti, M 2017, ‘Designing and delivering a learning & development strategy for the generation Y’, 7th Annual International Conference on Human Resource Management and Professional Development in the Digital Age (HRM & PD 2017) Conference Proceedings, New York, NY, pp. 48–57.
Erhardt, N & Harkins, J 2013, ‘Knowledge transfer across hierarchical lines: the importance of organizational structure and type of knowledge’, Academy of Management Annual Meeting Proceedings, vol. 2013, no. 1, pp. 823–828.
Kandogan, Y & Hiller, J 2018, ‘Alliances in international governmental organizations, regional trade agreement formation, and multinational enterprise regionalization strategy’, Journal of International Business Studies, vol. 49, no. 6, pp. 729–742.
Stephen, D 2018, ‘5 learning & development metrics that actually matter to the C-Suite’, Chief Learning Officer, vol. 17, no. 3, pp. 28–29.
Trevitt, C, Steed, A, Du Moulin, L & Foley, T 2017, ‘Leading entrepreneurial e-learning development in legal education’, Learning Organization, vol. 24, no. 5, pp. 298–311.
Vey, K, Fandel-Meyer, T, Zipp, JS & Schneider, C 2017, ‘Learning & development in times of digital transformation: facilitating a culture of change and innovation’, International Journal of Advanced Corporate Learning, vol. 10, no. 1, pp. 22–32.
Yang, F 2017, ‘Better understanding the perceptions of organizational politics: its impact under different types of work unit structure’, European Journal of Work & Organizational Psychology, vol. 26, no. 2, pp. 250–262.