Organizational Types in Business

Bureaucracy is a complex and multi-layered organization that strives for control and order using various methods and practices. It concerns itself with safety and preventing fraudulent behavior within the organization. Although bureaucracy is a helpful safety mechanism when used effectively, it can increase the time needed for decision-making. An example of a successful bureaucracy is the 1933 Glass-Steagall Act by the US government, which instituted ways of separating commercial and investment banking (Banton, 2020).

A normative organization is a group whose members believe in a shared goal’s social and moral value. Since the members do not get paid for participating in the organization’s activities, they are motivated by what they consider worthwhile instead of a paycheck. While many voluntary associations are religious, a significant part of them is secular. One of the most prominent examples of such an organization is the Red Cross, which strives to provide medical help to all people worldwide (Basin, 2020).

Unlike the Normative organization, a Utilitarian organization is one that people join for the sake of receiving a monetary reward. Otherwise known as a remunerative organization, it motivates its members by offering financial compensation. The main advantages of a Utilitarian organization are productivity and project-based purpose. This is because it provides tangible (often monetary) benefits and contractual membership, meaning that the people hired will be working on a particular project with a specific goal. An example of such an organization is a university since students pay the establishment to achieve knowledge and a skill set that might be useful to them in the future (Basin, 2020).

A coercive organization is an establishment that its members are forced to join by some means. Alternatively, the entry might be voluntary, but the members are pressured not to leave. In this case, the motivating factors are fear and force, the members are often cut off from the rest of the world, and the administrative authorities rigorously control their activities. An example of such an organization is a psychiatric ward, to which its patients might be admitted against their will and kept there under strict supervision (Basin, 2020).

An example of a successful organization is Walmart, an American international retail company. Over the years, it has kept its prices low by focusing on volume sales, its relationship with the suppliers, minimizing costs, and continuous innovation. For customers, this means that they can have an extensive choice and online access to a range of products (Global Retail Alliance, 2018).

References

Banton, C. (2020). Bureaucracy. Investopedia. Web.

Basin, H. (2020). Utilitarian organization – Definition, meaning and examples. Marketing91. Web.

Basin, H. (2020). What is a normative organization?. Marketing91. Web.

Basin, H. (2020). What is a coercive organization?. Marketing91. Web.

Global Retail Alliance. (2018). What makes Walmart so successful? Web.

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