SYMBIOSIS INSTITUTE OF MANAGEMENT
STUDIES
ORGANISATIONAL STRUCTURE OF A LIFE
INSURANCE COMPANY
Prepared By:
Manisha Sachdev
Roll No. 6
PGD RB & S’09
ORGANISATION- AN OVERVIEW
Organisation structure is designed for division of tasks, grouping of activities and coordinating and
controlling the tasks of the organisation. The detailed study of all components and dimensions of
organisational structure is required for creation of efficient and stable structure. Well designed
organisation structure facilitates the smooth functioning of the organisation.
Just as human beings have skeletons that define their parameters, organisations
have structures that define-theirs. It is like the architectural plan of a building. Just as the architect
considers various factors like cost, space, special features needed etc. while designing a good
structure, the managers too must look into factors like benefits of specialisation, communication
problems, problems in creating authority levels etc., before designing the organisation structure.
Jennifer and Gareth have defined organisation structure as the formal system of task and reporting
relationships that controls, coordinates and motivates employees so that they cooperate and work
together to achieve an organisation’s goals. In fact organisation structure describes
the organisation framework.
SIGNIFICANCE OF ORGANISATION STRUCTURE
➢ Clear-cut Authority Relationships
➢ Pattern of Communication
➢ Location of Decision Centres
➢ Proper Balancing
➢ Stimulating Creativity
➢ Encouraging Growth
➢ Making use of Technological Improvements
COMPONENTS OF ORGANISATION STRUCTURE
According to Robbins organisation structure stipulates how tasks are to be allocated, who reports to
whom,and the formal coordinating mechanisms and interaction patterns that will be followed. John
Ivancevich and Michael Matteson have also expressed the same view and advocated that manager
are required to take
following four decisions for designing organisational structure :
· Divisions of overall task into smaller jobs.
· Distribution of authority among the jobs.
· Bases by which the individual jobs are to be grouped together; and
· The appropriate size of group reporting to each superior.
DEPARTMENTATION-Key player in Organisational Structure
The division of labour divides the jobs into smaller activities. In order to coordinate these activities,
they are grouped together. The basis by which these activities are grouped together are known as
departmentalisation..The major benefits of departmentalisation are :
➢ Specialisation
➢ Administrative control
➢ Fixation of responsibility
➢ Freedom or autonomy
➢ Development of managers
TYPES OF ORGANISATION STRUCTURE
Functional Structure
Chief Executive
Manufacturing Marketing Finance
Mechanical Electrical Advertising Sales Accounts Audit
Work Work
Sub-units Sub-units Sub-units Sub-units Sub-units
Divisional Structure
Chief Executive
Corporate Planning & Control Finance Personnel
Chemical Products Division Textiles Division
Manufacturing Marketing Accounts Personnel
Manufacturing Marketing Accounts Personnel
Territorial Divisionalisaton
Corporate Planning Manufacturing Finance Marketing Personnel and Control
Eastern Division Western Division Northern Division Southern Division
Accounting Personnel Accounting Personnel Accounting Personnel Accounting Personnel
Manufacturing Marketing Manufacturing Marketing Manufacturing Marketing
Organisational Characteristics
Structure: An organisational structure defines how are job tasks formally divided, grouped and
[Link] organisational effectiveness, six elements need to be addressed while designing
organisational [Link] are: work specialisation, departmentation, chain of command, span of
control, centralisation and decentralisation, and formalization.
Technology: The term technology refers to how does an organisation transfer its inputs into outputs.
Every organisation has at least one technology for converting financial, human and physical resources
into products
or services. The choice of technology and its use influences organisational effectiveness.
Size: In a narrow sense organisational size refers to the number of people in an organisation. But, if
we take a broader view, size refers to the physical capacity of the organisation, the personnel available
to the organisation, the organisational inputs or outputs and the discretionary resources available to an
[Link] is the size which influences the structure which in turn influences organisational
effectiveness.
• Benefits of organisational effectiveness:
· Structures and behaviours are aligned with business needs.
· Disruption to business is minimised which reduces operational risk.
· Employee morale is sustained which maintains productivity.
· The right employees and talent are retained.
· Employees objectives and rewards are aligned to business goals.
Organisational Structure Of LIC
ORGANISATION OF CENTRAL OFFICE IN LIC OF INDIA
ORGANISATION OF ZONAL OFFICE IN LIC OF INDIA
ORGANISATION OF DIVISIONAL OFFICE IN LIC OF INDIA
B & AC Bancassurance and Alternate Channels OS Office Services
CRM Customer Relationship Management P & GS Pension
and Group Schemes
F & A Finance and Accounts P & IR
Personnel and Industrial Relations
IT Information Technology P &MR Planning
and Market Research
HPF Housing Property Finance PS Policy
Servicing
NB New Business / Actuarial SSS Salary
Saving Scheme
ORGANISATION OF BRANCH OFFICE IN LIC OF INDIA
F& A Finance and Accounts SSS Salary
Saving Scheme
IT Information Technology
NB New Business
OM Office Management
PS Policy Servicing