Organisational Culture and Structure on Business Performance

The success of a business depends on its management. Without management it is not possible to run or manage a business or anything else. In regard to managing businesses and associated behaviour the field of management behaviour has originated. Management behaviour is about making decisions. It helps people and businesses to concentrate on their goals and business objectives (Baligh 2006). Nowadays almost all businesses are involved in the practice of management behaviour that will be discussed here in this paper with the consideration of its different aspects.

The paper will include an analysis of the effects of structure and culture on business performance. Additionally, it will also include a discussion of changes that have occurred in management in last 40 years and that may occur in next 40 years. In the end, the skill set required by an individual to operate at management level will also be discussed.

Organisational structure and culture are significantly related to each other and make effects on business performance. For understanding the effects of culture and structure on business performance it is essential to understand organisational culture, structure and business performance (Ryall & Craig 2003).

Organisational structure is a formal system of work roles and authorities relations that determine how associates and managers work together with one other. It is a pattern of relationships among different organisational positions. With the help of structure it becomes easy to define the process of management (Clayton & Fisher n.d.). It also assists with a framework of order and command that directs mangers in planning, organizing, directing and controlling different organisational activities.

Organisational culture refers to the values shared by organisation managers and associates. It includes shared assumptions, beliefs, values, norms and language patterns (Ryall & Craig 2003). In addition to structure and culture business performance is the ability of a firm to attain its goals by making an effective use of its resources. All these aspects are interrelated to each other and also include several factors that affect individual performance in the workplace (Orna 1999).

Structure and culture are the key elements in an organisation’s success. If an organisation operates by concentrating on these aspects, it becomes easy to attract consumers and increasing competition. Whether a firm is small or large in its size, its effectiveness depends on how it is structure (Daft 2009). This organisational structure gets developed under the influence of the culture that in turn influences a firm’s ability to implement changes effectively.

If a firm is able to maintain an effective culture, it becomes able to develop well-planned organisational structure that makes it easy for business managers to implement changes and attain success. Organizational structure exercises within an organizational culture, but it is interrelated (Ryall & Craig 2003). Organizational culture pertains to a broader view that includes number of small organisational issues and aspects (Harris & Hartman 2001).

On the other hand, organisational structure refers to the infrastructure, and the number of methods and practices employed within that infrastructure (Clayton & Fisher n.d.). All the methods and practices assist an organisation’s culture to operate with the competence and consistency.

In modern era organisations are evaluated on the basis of their culture and structure that need to be managed critically. Structure is an integral part of an organisation culture as it primarily deal with the establishment of culture that in turn motivates employees to work effectively in the direction of organisational goals (Orna 1999). If a firm is not able to integrate its structure with culture it would not become able to encourage its employees to take initiatives’ and implement changes successfully that are critical for its effective performance (Baligh 2006).

Organisation culture involves several issues like how management works, which particular obligations supervisors have and how a complaint or issues can be passed through different organisational levels. All these issues related to culture are directly associated to how a firms’ organisational structure works. In addition to this, there are also several other issues related to culture that can only be resolved through an effective organisational structure (Clayton & Fisher n.d.). For effective performance of business it is vital to resolve these issue as otherwise it would not be possible to attain determined profit goals and objectives.

Another significant way to describe the interrelationship between structure and culture and their effect on business performance is to identify that how structure works. Organisational structure allows formation of different interrelated groups that are allowed to operate smoothly with specific role and authorities (Orna 1999). This framework or teams allows effective communication and coordination that builds a healthy culture and motivates employees to work in the direction of organisation goals attainment (Jumpponen, Ikävalko & Pihkala 2008).

Structure defines the roles and responsibilities of every individual and their interrelation to serve customers. This clear roles and responsibilities increases effective communication and coordination between organisation tasks and jobs that facilitates in developing a positive culture in which everyone works with association and participation (Clayton & Fisher n.d.). All these aspects significantly help managers in attaining organisation mission and vision.

Changes occurred in Management over the last 40 Years

According to senior level employees who are about to retire, it is believed that over the last 40 years several changes have occurred in management and this could be interpreted with the help of evolution of different organisational and motivational theories used by organisations. Previously in regard to management, organisations used to adopt scientific and bureaucratic approach that in present has been replaced by system theory and contingency approaches (Luthans 1998).

Previously all organisations used to motivate its employees on the basis of Maslow-Need hierarchy that in present is replaced by McClelland theory and several other theories. Before 40 years, all employees were only responsible for handling their specific tasks but nowadays situation has changed a lot as in present employees are responsible for planning, organizing, staffing, leading and controlling (McKenna 2000). In old times, it was not essential to play multi-purpose role that in present has become critical for effective management.

In past, almost all organizations used to Weber’s concept of bureaucratic structures but the increased complexity of multinational organizations has now created the requirement of a new structures like functional, project management, matrix and virtual (Luthans 1998). In addition to structure, several other new aspects have emerged in regard to management like different strategy levels, system approach to decision-making, socialization, departmentation, and different leadership theories etc (Harris & Hartman 2001).

All these concepts were not there in past for managing businesses but now scenario has changed completely as every business has its own specific needs and requirements and all of them select different management approaches according to their suitability (Jumpponen, Ikävalko & Pihkala 2008). In past almost all firms or businesses used to operate with empirical or case approach but now it is not the situation as firms operate with different approaches as competition has increased a lot and it has become difficult to attract customers.

In regard to increased competition, the companies are making use of different management approaches. Some present firms are using system approach that considers organisations to be open system whereas some of them are making use of operational approach that endeavours to develop the science and theory of management by drawing upon the concepts, knowledge, techniques from other fields (Luthans 1998).

In between these two approaches there are several other approaches that were used throughout last 40 years. In this way, it can be said that the business environment has changed significantly from the time when present senior level managers started working (McKenna 2000). All present senior level managers commit that they have seen several changes in the process of management but all these changes are based on the altering situations, trends and emerging technologies (Harris & Hartman 2001).

Changes likely to occur in Management in coming 40 Years

In regard to the discussion of the changes occurred in management in last 40 years, it can be stated that it is also likely to change in next 40 years. In present almost every aspects of business and its management are changing that will also continue to alter in coming years. An individual who is about to start his career in present 21st century is exposed with significant challenges and is likely to confront several other key changes (Pappas 2006).

In present employees are required to play several roles like interpersonal, information and decision making roles but in coming time employees will be required to operate in virtual environment. Presently employees are making use of advanced systems, discussion, meetings to collect information and perform their duties but in future they could do all these things in a virtual environment (Luthans 1998).

As well, employees who are about to start their professional career will also confront changes in their roles, levels of management, communication, business strategy, approaches to management and tools used to manage business related aspects (Jumpponen, Ikävalko & Pihkala 2008). The pattern of communication and business management followed till now will substantially changes in coming 40 years.

From last half decade the electronic mail has emerged as a key element of corporate communication but in coming years it will also change. In coming years, the management of communication will also change in regard to the change in organisational structures and cultures (Harris & Hartman 2001). The employees will be exposed to make use of powerful information-management and collaboration tools that are likely to emerge.

With these tools, employees will become able to link associated messages and track message flows more expeditiously (Pappas 2006). As well, it is also believed that the automatic language translation will take foot hold and interconnected messaging will appropriate young employees and managers with a facility to check e-mail, mobile messaging, voice mail, and fax machine from an only inbox (Fast Forward: 25 Trends That Will Change the Way You Do Business 2003).

In regard to the changes in communication and business management, it can be said that in coming 40 years most of the employees will depend more on computers rather than their own evaluations or perceptions. More and more softwares will be employed for different jobs and roles that will increase human capabilities (McKenna 2000). In next 40 years, it is likely that the firms and its employees will growingly make use of artificial intelligence to solve different business problems and the pattern of doing work will also change as everyone will be allowed to operate in a virtual environment (Fast Forward: 25 Trends That Will Change the Way You Do Business 2003).

Skills Set Required to Work at Management level

Working at management level is not as easy as it seems because it involves different skill sets and an ability to involve in team work and group. Nowadays managers are responsible for different roles that cannot be fulfilled if they operate on their own without communicating and coordinating with others. A manager is responsible for performing five functions that are planning, organizing, staffing, leading and controlling (Drucker 2007). In addition to this, a manager is also required to interact with many people both within the organisation and outside the organisation and hence perform interpersonal roles (Montana & Charnov 2000).

For effective interactions and management it is vital to have an ability to communicate, understand, listen, interpret, convince and lead others. If an individual have all these skills and abilities then he can effectively interact with organisation’s internal as well as external customers and associates. With these skills, a manager can easily play interpersonal roles that may be of figurehead, leader and liaison (Drucker 2007). With the above discussed skills a manager also become able to perform his informational (recipient, disseminator, and spokesperson) and decision roles (entrepreneurs, disturbance handle, resource allocator and negotiator).

In addition to these skills several other skills are also required by an individual to operate at management levels that are as follows:

Technical Skills:

Technical skills pertain to the ability of an individual to perform specific activity. In order to perform specific activity an individual should have all-essential knowledge of methods, processes and procedures as otherwise it would not be possible to carry out given task or duty (Atwood 2008). This could also be understood with the help of examples of some positions like engineers, accountants, computer specialists and project managers who have necessary technical skills for their specialized fields.

These skills are essential for an individual to operate at management level as he may also be given responsibility to manage and evaluate others. Without technical skills, it would not be possible for an individual to operate at management level that includes functions like planning, organizing, staffing, leading and controlling (Pride, Hughes & Kapoor 2009).

Human Skills:

Human skills required by an individual to operate at management level are also known as interpersonal skills. It refers to the ability of an individual to work well with other people in a group or team. It refers to the ability of an individual to direct, motivate and communicate with people to help them to attain given objectives (Drucker 2007). These skills are highly important for a person in regard to the creation of an environment in which everyone feels comfortable, free to communicate and share their opinions.

This kind of environment can only be create when a manager have human skills. With human skills, a manager can help its employees throughout their interactions with supervisors, peers and people outside the work like customers, suppliers and public. These skills are imperative for an individual to operate at all management levels of an organisation (Montana & Charnov 2000).

Conceptual Skills:

Conceptual skills mean the ability of an individual to think and conceptualize abstract situations. It refers to the ability to comprehend and match up all essential corporate objectives and activities. These skills are critically required when a person is employed at top management level as top managers are highly required to predict changes and see big picture in regard to future (Montana & Charnov 2000). Top managers are required to interpret present internal and external changes and trends for the identification of future business strategies.

Without conceptual skills an individual cannot operate at management level as it is essential to identify meaning and develop business strategies accordingly (Drucker 2007). The significance of this skill set can also be understood in regard to present competition that requires managers to make appropriate interpretations and appropriate business plans and strategies accordingly.

Design Skills:

In addition to technical, human and conceptual skills an individual who is going to work at management level is also required to have design skills. Design skills refer to an individual’s ability to identify solutions of problems in a way that can significantly benefit organisation. Having the design skills is essential for individuals that are going to operate at management level as at this level there is a critical need of solution rather than just identifying problems (Montana & Charnov 2000). Until or unless an individual is not able to propose solutions of different organisational problems with his design skills, he would not be appropriate to work at management level.


With the help of above discussion, it can be said that management behaviour is an important practice that should be followed by all organisations for attaining an assured success. With the considerations of management related aspects like structure, culture and their interrelationship, affect on business performance a firm can become able to attain high profits and increased performance (Montana & Charnov 2000). As well, the evaluation of changes occurred in management in last 40 years and the changes that can occur in coming 40 years is also quite effective as it directs present companies with all essential changes that they should follow for attaining their aims and objectives.

Additionally, the identification of skill set required for an individual to operate at management level is also critical as with this a firm can hire or develop employees accordingly. An appropriate skills set is essential to effectively work at management level.

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