Responsibility and reporting structure is often visualized by an ornigram. Each function is given goals, resources and working instructions top-down and reports achieved results bottom-up. An ornigram describes a clear and stable structure for the business with the risk that the functions care more about themselves than the total business, the silo effect, and that the organization stiffens in a bureaucratic working mode unable to adapt to external changes.
A way to compensate the silo effects is to establish horizontal processes creating a matrix organization. To make it work, the organization has to change the overall management processes so that the total business results are more important than the functional results. Leaders, trained in and with their success from the functional line organization, have often problems to act in the more dynamic process organization where you should master problem solving. If conflicts arise between line and process, the line organization will often win.
The ornigram creating orderliness has to be supplemented by active management engaging all employees in innovation and development that is harder to manage in a strict way. When life cycles for products and business models are shortened, the leaders have to master strict management to sustain the present business as well as less strict management to prepare for future changes in order to compete.
An organization is a tool to support the business. An organization shall adapt and change when the business changes. Be skeptical to big reorganizations. It is rare that an organization is populated by incompetent employees that have to be reorganized. It happens more often that the board and management group have lost control of the business, have wakened too late and lack ability or energy to steer the business. If so no reorganization will help.
An ornigram supporting the management system comprising common functions of a normal scheduled airline is shown below. The organization may look large and complicated for a smaller airline where several functions are gathered and delegated to one person. Nevertheless, for sustainable business development you have to master most of the functions.
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