Manag., July-2016-Q8
- Option : A
- Explanation : Neo-Classical writers gave an organizational design which is a modification of classical structure in the following ways:
(a) Flat structure: As against the tall structure of the classical theory, the Neoclassical theory suggests a flat structure. Tall and flat structures are extensions of the concept of span of control. Tall structure with narrow span creates problems of communication, motivation and expense. In a flat structure, the scalar chain is shorter. As a result communication and motivation tend to be more effective.
(b) Decentralization: The Neo-classical theory suggests decentralization which is closely related to a flat structure. The decentralized structure allows initiative and autonomy at lower levels.
(c) Informal Organisation: The Classical theorists did not consider informal organization. Neo-classical writers suggested that both formal and informal organizations are interdependent and both must be studied for a complete understanding of behavior in organizations. Formal organization represents deliberate or official channels of interactions. But it suffers from several weaknesses. Therefore, an informal organization is created to plug its loopholes and to satisfy the social and psychological needs of people. Management neither creates nor can it eliminate informal groups. It should use these groups to improve communication and to overcome resistance to change.
Neo-classical organization theory has attempted to overcome the limitations of classical theory. It is certainly more humanistic and is an improvement over the Classical theory. It has introduced behavioral sciences in the study of organizational functioning. This is really a valuable contribution.
