Mechanistic organizations have clear, well-defined, centralized, vertical hierarchies of command, authority, and control. Efficiency and predictability are emphasized through specialization, standardization, and formalization. This results in rigidly defined jobs, technologies, and processes. The term mechanistic suggests that organizational structures, processes, and roles are like a machine in which each part of the organization does what it is designed to do. The following are some of the characteristics of Mechanistic organization structure.
The term “organic” suggests that organizations change their structures, roles, and processes to respond and adapt to their environments.
Organic structures are appropriate in unstable, turbulent, unpredictable environments and for non-routine tasks and technologies. For organizations coping with such uncertainty, finding appropriate, effective, and timely responses to environmental challenges is of critical importance. I have chosen Philips to analyze how both organic and Mechanistic structure is adapted in its HealthCare sector organization. Overview of Philips Royal Philips Electronics of the Netherlands is a diversified Health and Well-being company, focused on improving people’s lives through timely innovations.
As a world leader in healthcare, lifestyle and lighting, Philips integrates technologies and design into people-centric solutions, based on fundamental customer insights and the brand promise of “sense and simplicity”. Philips Healthcare with Organic Structure The global healthcare market is dynamic and growing. Rising healthcare costs present a major challenge to the society. There is a great demand for better diagnostic, screening and treatment in the health care.
Philips is placed in a dynamic environment where Innovation is the key.
The HealthCare sector of the company is one of the top players in Imaging Systems, Clinical Care Systems, Home Health Care System and Customer Services. In order to grow in the dynamic market, the company makes investment in the above mentioned areas through new product innovation or through mergers and acquisitions. Philips by acquiring new companies and creating new health care products adapted an organic structure to stay on top of the dynamic, competitive healthcare industry.
Example of this is an acquisition of Respironics to make the company’s presence in the Home Health care sector and have a considerable presence in the market. Also one more company for the software and revenue (even though lot of money was put in to built the software in house. Philips Healthcare with Mechanistic Structure The company is subjective to extensive regulation. So the products produced should be full compliance with regulatory. Innovation is one part the other part is implementation or the New Product development process which are all standardized.
There are guidelines established for every stage of product development which the company needs to adhere strictly. For example to procure the needed supply of raw materials or having design consultation with the firms, the company follows standardized norms and procedures as to what needs to be done for that. This makes the manufacturing side of the organization to be Mechanistic where the policies, procedures, processes and tasks are well defined and each of that needs to be adhered in order for the company to be complaint.
I would conclude by saying that it is not always necessary for an entire organization to be organic or mechanistic. Some units, such as research and development departments, may benefit from an organic structure because they face an unstable environment. In case of Philips mergers and acquisitions are also exhibit organic nature of the company, because the reason for merges is to have competitive advantage in the market place. Units that have a more stable environment, such as routine, process oriented departments can be Mechanistic in nature. In case of Philips manufacturing department can be considered mechanistic.
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