If your small business uses an organic organizational structure, it likely has few managers to whom employees report and gives employees more decision-making responsibilities. This informal flat structure differs from a hierarchical mechanistic structure that contains several layers of management and a more formal reporting structure.
While an organic structure can facilitate communication and decision making in your company, there are disadvantages when it comes to effective management, productivity, employee satisfaction and growth. Consider both organic organizational structure advantages and disadvantages when deciding on the right structure for your small business.
One of the problems with an organic organizational design is that the flat structure means there are fewer managers – or even just one – in charge of managing all employees. This can easily overwhelm management and lead to a loss of control when there are a large number of employees.
At the same time, relationships between employees and management can suffer when there's not enough time for close supervision and mentoring. This can lead to more negative work behaviors and lower employee morale when employees feel management isn't involved.
An organic organizational structure in companies also comes with potential issues that can make employees confused about their roles, feel less motivated and find it more challenging to work productively. Having less management means employees are often left to get their jobs done on their own, and this can require performing tasks outside their regular job duties rather than focusing on their primary roles.
At the same time, not having management constantly watching employees can influence workers to not do their best since they may feel they won't be rewarded for their good behaviors anyway.
Lack of direction from management, unclear job roles and heavy work demands can all result in an organic structure making employees less satisfied and possibly even increasing turnover. Employees in these types of companies may feel their positions come with too much responsibility and not enough guidance, and they may argue over whether a task is outside their job roles.
In some cases, the heavy workload can erode work-life balance and hurt employees' quality of life. In addition, fewer opportunities for advancement can lead workers to leave the company and seek workplaces where they can move up into leadership positions more easily.
While an organic organizational design may be successful when your small business is simple and has fewer employees, large struggles can occur when you're ready to grow your business. If you retain this organizational structure while increasing your workforce significantly, you'll have a larger chance of losing control of your employees and not being able to manage them effectively.
In the end, you can see your business's productivity and profitability decline if employees aren't well monitored or feel they don't have the resources and support to meet business demands.
Along with these challenges, an organic structure comes with the benefits of easier decision making, lower costs, clearer communication and more autonomy for employees. Since there's not a complex chain of command, managers can make decisions more efficiently, communicate with employees and respond more quickly to changes.
The company also saves time and money since it has to hire fewer managers and can instead focus its investments on other business needs like product development or marketing. Employees also get more control over their work, which can motivate self-directed workers.
A more formal mechanistic structure can offer higher productivity, improved relations between employees and management, stronger managerial control and easier growth than an organic structure can. Having more guidance means employees may feel more confident about their work and the company, and managers can respond more quickly to performance issues. However, having several layers of management can make decision making and communication harder and can cause conflicts when the company needs to make a major change.