Bureaucratic organization

Bureaucratic organization as opposed to learning organization is strictly formalized type of organization. Every action of the employee has been defined and described, and often innovation and changes in the processes are blocked by the management (due to resistance to change). In these organizations there is no atmosphere conducive to innovation and development of staff, often such companies can not flexibly adapt to changing conditions of environment. Basic features of the intelligent (learning, innovative) opposed to the bureaucratic (operational) organization is shown in the table below.

Comparison of bureaucratic and intelligent organization

Aspect of the comparisons	Bureaucratic organization	Intelligent Organization
Type of work activities	Only a small fraction of workers are fully using their knowledge Absurd repetition of steps Individual or group Work Performing various duties	Work based on knowledge of all employees Work based on innovation Teamwork Projects
Organization	Division of labor Departmentization Hierarchy The strong position of managers - manager autocrat Top-down coordination	No typical job positions - manager as coach and inspirer Managerial roles: the sponsor, the generator of ideas, the leader Differentiation Coordination by team members
Processes	Provide information and communication Planning and budgeting Measurement of results Departments linking Orientation to the inside of the company - in order to maintain internal balance	Planning and resource sharing Getting ideas Combine ideas Transfer of projects to manufacturing Management of programs Customer Orientation
Incentive System	Compensation Promotion Style of leadership Valuing the job position	Opportunities / autonomy Promotion - recognition Special compensation
People	Selection / Recruitment Promotion / transfer Training / Development The use of individual abilities	Selection Training / Development Team capacity utilization

See also:

• Characteristics of bureaucracy
• Disadvantages of team work
• Jacob Mincer

Examples of Bureaucratic organization

• Walmart: Walmart is a large, multinational corporation with a bureaucratic structure. The company operates under a top-down structure, with corporate executives making all major decisions and those decisions trickling down to the store-level managers and employees. This structure is quite rigid and the company is known for its strict managerial policies.
• McDonalds: McDonalds is also a large, multinational corporation that uses a bureaucratic organizational structure. This structure is highly centralized, with corporate-level executives making all major decisions. Decisions are then implemented by lower-level managers and employees. McDonalds is well known for its strict managerial policies and its highly structured organizational structure.
• Government Organizations: Government organizations typically use a bureaucratic organizational structure. This type of structure is highly centralized, with decisions made at the top-level and then implemented by lower-level managers and employees. Government organizations are known for their rigid rules and regulations, as well as their strict hierarchical structure.
• Military Organizations: Military organizations are known for their highly bureaucratic structure. These organizations typically have a top-down structure, with decisions made at the top-level and then implemented by lower-level managers and employees. Military organizations are known for their strict structure, rules and regulations.

Advantages of Bureaucratic organization

Bureaucratic organizations have several advantages over learning organizations, such as:

• Clear and precise rules and regulations which allows for efficient and consistent decision making processes.
• Established hierarchy of authority and responsibility allows for a clear understanding of roles and responsibilities.
• The bureaucracy allows for a system of checks and balances in decision making and execution of tasks.
• The existing structure and rules allow for efficient communication and coordination. This allows for faster decision making.
• It provides a sense of security to the employees as they know what is expected of them and their roles are clearly defined.
• The bureaucracy allows for a well-defined and structured workflow which helps to streamline processes and workflows.

Limitations of Bureaucratic organization

Bureaucratic organizations have a number of limitations, including:

• Inflexibility to changing conditions - Bureaucratic organizations are designed to maintain the status quo and resist changes, making them unable to adjust quickly to new market conditions.
• Lack of innovation - Bureaucratic structures limit innovation and creative problem solving, as there is often a culture of fear of failure and a lack of incentives for risk-taking.
• Difficulty in motivating employees - With rigid rules and regulations, there is often little room for creativity or recognition of good work, leading to low morale and lack of motivation.
• Slow decision-making - Bureaucratic organizations are often slow to make decisions, as they require a number of levels of approval, leading to inefficient decision-making and a lack of agility.

Other approaches related to Bureaucratic organization

Apart from the features listed in the table, there are several other approaches that are related to the Bureaucratic Organization.

• Centralization of authority: This approach means that the authority of decision-making lies with the top management, with no regard to the views of the lower-level employees.
• Standardization of procedures: This approach means that all activities and processes are standardized, with no room for innovation or change.
• Hierarchy of authority: This approach means that there is a clear hierarchy of command, with each level of the organization having a specific role and authority.
• Rules and Regulations: This approach means that there are strict rules and regulations that are to be followed by all employees, with little to no leeway.
• Task Specialization: This approach means that each employee is given a specific set of tasks to complete, with no cross-functionality or flexibility.

The Bureaucratic Organization follows the approaches of Centralization of Authority, Standardization of Procedures, Hierarchy of Authority, Rules and Regulations, and Task Specialization. These approaches lead to a formalized, structured organization with little to no room for innovation or change.

Bureaucratic organization — recommended articles

Hierarchical dependence — Characteristics of bureaucracy — Adhocracy — Linear structure — Organic organization — Radial structure — Determinants of culture — Levels of management — Forms of organisation

References

• Blau, P. M. (1956). Bureaucracy in modern society.
• Downs, A., & Rand Corporation. (1967). Inside bureaucracy (p. 264). Boston: Little, Brown.
• Thompson, V. A. (1965). Bureaucracy and innovation. Administrative science quarterly, 1-20.
• Weber, M. (1946). Bureaucracy. From Max Weber: essays in sociology, 196-244.
• Wozniak K., Management information system as an instrument of strategic management in the company, PhD Thesis, Cracow University of Economics, Cracow 2005

Author: Krzysztof Wozniak