Organization models - Ask John Show x Management Knowledge by VSHR Pro Academy


Sharing and updating knowledge about management is what Ask John Show wants to aim to help many future entrepreneurs and administrators.


Today, let's review the organizational models that businesses are using today! Each model has different advantages and disadvantages, depending on the management style as well as the nature of work and the size of the business, which changes flexibly.



1. Hierarchical Organization

The simplest and oldest form of organization. The decentralized organizational structure operates in a sequence: directives are issued from the top, then communicated down to middle managers and then to employees.


If an employee wishes to suggest an idea, he or she will send it to the direct manager. After approval, the proposal is again forwarded to senior management. The results will then be returned to the employee in reverse order.




2. Functional Organization

A functional structure in which each management function is separated by a department or agency. This structure is characterized by functional staff who are knowledgeable and professional in their areas of management.

The functional organizational structure was developed by F.W. Taylor while he was working as a foreman: “Divide management work so that each person from the CEO down takes on as few functions as possible. body”.

According to Terry, "A functional organization is an organization divided into a number of functions such as finance, production, sales, human resources, administration, and R&D. Each function is performed by a Experts". Executive, employee and functional authority as a third type of authority of this type of organization.



3. Matrix Organization

The matrix organizational structure is based on a multi-dimensional support and authority system. Information will be circulated both vertically (line of operational function) and horizontally (line of product or facility of operation).

Initially, the matrix model was only applied in the aviation industry with the typical two "big" Lockheed and General Dynamics. The reason is because the aviation industry has a part that requires separate handling, if applying the traditional management model, it will delay or even disrupt the work flow of the entire organization. Later on, the matrix structure was applied in companies that required many projects or production of many products in the same time period.




4. Flat Organization

Companies that adopt a flat structure often do not have job titles. Everyone in the organization is equal. The flat form of corporate organization is also known as self-managing organization.

You may be wondering that a flat structure works without a manager, so how can a business get it all done? This is why the flat model can only be applied in businesses with few employees or businesses that have to really create a strong collaborative culture among employees.

Flat structures work best when employees are closely connected. Internal communication is key to bringing people together and making sure everyone is on board with a unified mission. In addition, work management platforms with operational monitoring and control functions are very useful in businesses that adopt a flat organizational model.



5. Holacratic Organizations

Decentralized management model does not need titles and ranks. Power between individuals is equally distributed. Unlike the flat model, with the decentralized management model, jobs will be assigned according to roles. An employee can take on many different roles and be in a circle.


Simply put, Holacracy is a management model without superiors, employees will manage themselves and act as their own bosses. In the decentralized model, transparency is always an important factor. All employees and management must follow the same clear guidelines. Currently, decentralized management is being applied in SMEs and non-profit organizations in advanced countries.



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