ture that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which dem

A person who has a lazy, slow-moving gait tends to look less commanding than someone who walks with a good posture that exudes confidence. Likewise, the way the company is organised can help it position for future growth.

The world has changed dramatically. These days, being internationally competitive is the name of the game. With the dissolution of the international trade barriers and the evolution of a new global economy, many companies have gone through a continuum of transition from being international (stressing an export-import orientation), to being multinational (having major operations abroad that are concentrated on specific, relatively protected markets) to being global (looking at the entire world as a market). The new and total global economy has come of age.

There are three organisational structures:

Multi-local The overseas affiliates are given full autonomy with little interference from the headquarters. This structure is suitable for organisations that require high customisation, flexibility and speed to respond to the market place. Examples of industries requiring such structures include the retailing, auditing and consulting businesses etc. The downside is that there are wasteful duplications and low cost efficiency. However, in industries that require ground knowledge, the trade-off for economy of scale and duplications is speed and flexibility.

Global The overseas affiliates are given little autonomy. The headquarters make all the major decisions. The organisational structure is by functions, with each function such as the sales and marketing, financial heads of the subsidiaries reporting to the headquarters’ functional heads. In some companies, the functions are grouped by product lines and major customer accounts reporting back to the heads for the product lines and multinational accounts. If worldwide efficiency is required, then this structure is more appropriate. Examples of industries requiring such structure include electronic chips, consumer electronics etc. The disadvantage of this structure is the erosion of local responsiveness as it entails very centralized control.

Transnational In some cases where both local and global know-how are important, the transnational structure may be appropriate. The organisational structure is based on a matrix with dual reporting and the achievement of consensus as the key driver. Depending on the nature of your business, you should adopt an organisational structure that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which demo

oncentrated on specific, relatively protected markets) to being global (looking at the entire world as a market). The new and total global economy has come of age.

There are three organisational structures:

Multi-local The overseas affiliates are given full autonomy with little interference from the headquarters. This structure is suitable for organisations that require high customisation, flexibility and speed to respond to the market place. Examples of industries requiring such structures include the retailing, auditing and consulting businesses etc. The downside is that there are wasteful duplications and low cost efficiency. However, in industries that require ground knowledge, the trade-off for economy of scale and duplications is speed and flexibility.

Global The overseas affiliates are given little autonomy. The headquarters make all the major decisions. The organisational structure is by functions, with each function such as the sales and marketing, financial heads of the subsidiaries reporting to the headquarters’ functional heads. In some companies, the functions are grouped by product lines and major customer accounts reporting back to the heads for the product lines and multinational accounts. If worldwide efficiency is required, then this structure is more appropriate. Examples of industries requiring such structure include electronic chips, consumer electronics etc. The disadvantage of this structure is the erosion of local responsiveness as it entails very centralized control.

Transnational In some cases where both local and global know-how are important, the transnational structure may be appropriate. The organisational structure is based on a matrix with dual reporting and the achievement of consensus as the key driver. Depending on the nature of your business, you should adopt an organisational structure that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which dem

nd low cost efficiency. However, in industries that require ground knowledge, the trade-off for economy of scale and duplications is speed and flexibility.

Global The overseas affiliates are given little autonomy. The headquarters make all the major decisions. The organisational structure is by functions, with each function such as the sales and marketing, financial heads of the subsidiaries reporting to the headquarters’ functional heads. In some companies, the functions are grouped by product lines and major customer accounts reporting back to the heads for the product lines and multinational accounts. If worldwide efficiency is required, then this structure is more appropriate. Examples of industries requiring such structure include electronic chips, consumer electronics etc. The disadvantage of this structure is the erosion of local responsiveness as it entails very centralized control.

Transnational In some cases where both local and global know-how are important, the transnational structure may be appropriate. The organisational structure is based on a matrix with dual reporting and the achievement of consensus as the key driver. Depending on the nature of your business, you should adopt an organisational structure that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which dem

rldwide efficiency is required, then this structure is more appropriate. Examples of industries requiring such structure include electronic chips, consumer electronics etc. The disadvantage of this structure is the erosion of local responsiveness as it entails very centralized control.

Transnational In some cases where both local and global know-how are important, the transnational structure may be appropriate. The organisational structure is based on a matrix with dual reporting and the achievement of consensus as the key driver. Depending on the nature of your business, you should adopt an organisational structure that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which dem

ture that enables you to meet with your business objectives, and which will provide flexibility and room for future growth. The common thread in the above three structures is the concept of ‘flat organisation’.

The phrase ‘flat organisation’ is now overworked and misunderstood. It is an oxymoron, a contradiction in terms. Any organisation that exists for a purpose needs a spine of decision-making accountability. This applies to private corporations, public institutions, voluntary organisations and cooperatives.

A good organisation structure is one with the optimal number of layers of leadership, which demonstrably add value to the work of the others. This includes the design and delivery of mission and strategy. It provides space and challenge for individuals to achieve, continue to learn, grow and enjoy their work and be duly rewarded for their performance.

The theory is clear. The problem for managers is how to design it in practice. How many vertebrae should there be in this spine of accountability? What are the key functions? How are they identified? What is the impact of removing a function from this spine? What impact will this have on the development and motivation of the incumbents? Surprisingly, at the beginning of the 21st century this is still an area of guesswork and fashion in most organisations