1

Structure of the Organization
Structure of the Organization is identified as one of the 39 subject areas (facets) of Asset Management as defined by the IAM and GFMAM.



Definition

The formalized system that defines the functions and interelations betweens roles, responsibilities, authorities, communcations, and rights.

Organizational structure determines how the roles, power and responsibilities are assigned, controlled, and coordinated, and how information flows between the different levels of management.

The manner in which an organization interacts with other organizations will depend on its internal structure and its culture. Every organization has both a structure and a culture -- they are like two sides of the same coin. An organization cannot have a structure without also having a culture and cannot have a culture without a structure.  

  • Structure of the Organization – This is a “formal” system of the functions and interrelations between the roles, responsibilities, authorities, communications, and rights of the members of the organization. 
  • Culture of the Organization – This is an “informal” system of shared assumptions, values, and beliefs, which have a strong influence on how people behave inside the organization. Culture expresses itself in how people dress, act, and perform their jobs.

Organizations need structure in order to survive. Where structure is somewhat like “oxygen”, culture can be thought of as the “atmosphere” in the organization. But we seldom find pure oxygen in nature. It is often filled with different things to make compounds and mixtures. 

Listed below are the three primary types of structures for organizations:

  • Functional – The organization is structured vertically based on the specialized skills of its people. For example, maintenance skills, financial skills, and administrative skills.
  • Divisional –The organization is structured horizontally to reflect the different products or services that it creates or the projects that it undertakes.
  • Matrix – This is a hybrid of the functional and divisional structures.

These horizontal (divisional) and vertical (functional) dimensions are delivered through a 2nd set of structures:

  • The pyramid structure (power rests at the peak of the pyramid)
  • The bicycle hub-and-spoke structure (power radiates out from the centre)
  • The silos (power sits at the top of each division).



Types of Structures
Listed below are some of the different structures of organizations:

      Type A
  • Pyramid hierarchy
  • Matrix
  • Silos
  • Hub and Spoke
       Type B
  • functional structures
  • non-functional structures

Challenges with Structural
Listed below are some of the key challenges emerging from or facing the structure:
  • Culture of the organization
  • Functional silos
  • Imbalanced power
  • Power struggles
  • Lack of coordination
  • Lack of integration
  • Lack of motivation

Artefacts
Listed below are some of the key artefacts of the structuire of an organization:



Management Principles
Listed below are some of the management principles associated with organizational structure



Structure vs. Culture

Sometimes the structure dominates the culture and sometimes the culture dominates the structure. Ideally, both culture and structure should be managed holistically. 

There is a well known quote from Peter Drucker that says “Culture eats strategy for breakfast”. What this means is that some of the best O&M plans can be defeated if the organization is not ready to adopt the plan. It is a waste of time to attempt to force a plan onto an organization if the organization has strong cultural values that are at odds with the plan.

The O&M team needs to understand the difference between the structure and culture as these aspects of the organization can have a major influence on success or failure.

There are ptions for making changes to structures and cultures of an organization and reveal how O&M strategy should always invite culture to sit down for breakfast.

Clearly defined roles, responsibilities and authorities are one of the signs of good leadership
Fig. Clearly defined roles, responsibilities and authorities are one of the signs of good leadership. In accordance with ISO 55000, these must be coupled with appropriate structures and relationships to establish the asset management system (AMS) within the organization.


Top management establishes the structure of the organization
Fig. Top management establishes the structure of the organization.


As we dig deeper into ISO55001 we find the rich fabric of concepts woven into each chapter.
Fig. As we dig deeper into ISO 55001 we find the rich fabric of concepts woven into the seven chapters. This is where the nuances and complexities of asset management start to reveal themselves.


The Asset Management System (AMS) within the organization
Fig.  The relationship between Asset Management (AM) and the Asset Management System (AMS) within the organization is not always clearly articulated.


Functional silos will defeat the organization. Rather, integration, collaboration and alignment are some of the critical success factors.
Fig. Functional silos will defeat the organization. Instead: integration, collaboration and alignment are some of the critical success factors.

See also:
    Compare with:








    (c) Copyright Asset Insights, 2000-2013, All Rights Reserved - "Insight, foresight and oversight of assets"