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An organizational structure is a format within which an institution or a business entity devises and executes its day to day operations. It can be described as process of coordinating the human resource, communication and technology as well as other resources within a given organization. For an organization to come up with a structure, it has to make use of a well thought out design. A design must support any type of organization to reach the goals it is aiming to achieve. Normally, the staff discusses the needs of the organization and then come up with a criterion to meet the needs. Good designs accompanied with deliberate workforce effort are essential to realizing an effective organizational structure (Burton et al, 2006).
A good organizational design enables an organization to put in place a good structure. To demonstrate this, we use the example of Wal-Mart Stores. Wal-Mart is a corporation which owns several department stores and warehouses which all deal in different specialties and are situated in diferent geographic locations. For instance, the headquarters is located in Arkansas. Some of the stores include: Wal-Mart Reality, Wal-Mart International, Wal-Mart Specialty, Sam Stores and Super Stores. Wal-Mart is also the biggest grocers. Wal-Mart is well established in the United States and spans all the 50 states. Other countries are Mexico, Puerto Rico, United Kingdom and Japan (Burton et al, 2006).
The organizational structure used in Wal-Mart has a divisional formation. It comprises of divisions which are separate. In one division, there are different units which operate independently to achieve their set objectives. Every division has an overseer who coordinates activities and is answerable to the senior management as well as the board. Overseers therefore have to put in effort to ensure success of the divisions they are in charge of.
The divisional structure has been of immense aid to the corporation in terms of managing its performance. Due to the different location of the departments, the structure has met the needs of the corporation, through establishing separate managers for each unit. When every manager embraces this policy, all the departments will perform well and with synergy. The managers are, operationally, the one who are driving their units to achieve success. One of the key targets of the corporations is to maximize profits. Through the help of the divisional structure, the revenue of the stores has significantly increased over the years. For example in 2009, the grocery department alone had raised US$258 billion.
Recently, Wal-Mart had been sued by some employees who had not been compensated for working extra hours. This matter was forwarded to the human resource division and the compensation was immediately paid out. This is a good illustration which demonstrates that the structure being used is able to solve problems and meet the needs of the corporation. It might have been taken to be an unethical issue by the society, but such mistakes occur in big organizations but they are solvable at the point of detection.
An organization cannot be successful if it does not have an effective organizational design and structure. Without these two, it is not possible to effectively run operations of an organization. The structure entails having good policies, rules, chain of command, principles and other factors which are considered when coming up with a good design. If all these determinants are not coordinated then the staff of an organization will lack cooperation and the organization will definitely not achieve its intended goals as well as its needs. Such failures reflect poor management skills. Organizations should design their appropriately structures so as to take care of every need that is already present or may arise.