People commonly assume that bureaucracies are inefficient. Critics claim these organizations are slow, rule-bound, and have too much “red tape.” The media makes you think bureaucracies are extinct—replaced by empowered teams and loosely structured and adaptive organizations. Although many organizations today do look like that, the truth is that bureaucracies are still alive and well. Most medium-sized and large organizations are structured as a bureaucracy because its traits—specialization, formal rules and regulations, clear chain of command, and departmentalization—help efficiently structure people and tasks.
Welcome to the fascinating world of organization structure and design in the twenty-first century! At the Wall Street Journal, a broad editorial reorganization created a new leadership structure with the goal of transforming the newspaper into a mobile-first news operation.1 Many of the big fashion houses are hiring environmental experts and strengthening the role of their sustainability departments in response to socially conscious young consumers.2 These are examples of organizing in action. In this chapter, we present the basics of the organizing function of management. We define the concepts and their key components and how managers use these to create a structured environment in which organizational members can do their work efficiently and effectively. Once the organization’s goals, plans, and strategies are in place, managers must develop a structure that facilitates the attainment of those goals and provides a way for people to work best.