In the freewheeling '60s, it was an insult to call someone a bureaucrat. Today, more American employees are working in bureaucratic organizations than ever before. The number of managers, executives and supervisors have increased by 90 percent between 1983 and 2014. During the same period, employment in other roles grew by only 40 percent. Instead of being seen as stuffy and old-fashioned, these organizations are viewed as sensible set-ups designed to maximize profit.
The bureaucratic culture is just as popular today as it was centuries ago. This type of organizational structure derives from the bureaucratic management theory, which was first used and described by German sociologist Max Weber. He believed that this was the most efficient way to run an organization.
The bureaucratic organizational business model is characterized by standardized processes and strict rules. Each employee has a clearly defined role and responsibilities. A common trait of bureaucracies is impersonality. Employees are hired based on their ability to perform the tasks assigned to them, and personality has little to do with their success.
In a bureaucratic organization, the recruiting process is formal and involves job-specific tests. Promotions are merit-based, not dependant on seniority. Employees are highly specialized, which is why this type of company may have hundreds of job titles.
All bureaucratic organizations share similar characteristics. These include a clear hierarchy, a division of labor, a set of formal rules and specialization. Every employee has her place in the chain, and everyone's role is supervised by someone on the next level up. Decisions flow from the top down.
Employees are organized into units based on their skills and the type of work they do. They are treated equally and maintain impersonal relationships with their colleagues and managers. All decisions and actions taken by the company are recorded in writing. Rules rather than people form the basis of the organization. According to Weber, these processes contribute to effective and efficient goal attainment.
An example of a bureaucratic structure is the U.S. Military. The troops are divided into brigades, which are divided into battalions. Battalions are split into companies, which are further divided into platoons. Each platoon consists of several squads. The same happens in a bureaucratic organization. Everyone has clearly defined roles and levels of authority.
Other bureaucracy examples include the state department of motor vehicles, hospitals and utility companies. In general, this organizational structure is used by corporations, governmental agencies and large companies that employ hundreds or thousands of people and need to monitor outcomes closely.
There are different types of organizational structures, and each has its advantages and drawbacks. The bureaucratic culture received a lot of criticism for being too rigid and impersonal. The matrix structure has emerged in response to these challenges. This organizational model combines project and functional structures, which allows information to travel faster.
In a matrix organization, each employee reports to a manager or team leader but does not work directly under his supervision. Additionally, he may have duties in several departments, such as marketing and customer service. This allows employees to learn from each other and perform a wide range of tasks. Generally, the matrix structure is used by organizations that emphasize change and innovation. Teamwork is key and is generally valued above individual accomplishments.
No organizational structure is perfect. Before choosing one for your company, take the time to learn about the different options. A bureaucratic structure, for example, may lead to increased productivity and performance but it gives employees less opportunity for creativity and decision-making. A matrix structure, on the other hand, provides a lot of freedom and flexibility but it could also lead to chaos and power struggles.