Advantages and Disadvantages of Structures

Question 1

Advantages of simple structure

Answer 1

Highly informal culture

Little specialization of tasks

Question 2

Disadvantages of simple structure

Answer 2

Limited opportunities for upward mobility

Question 3

Advantages of functional structure

Answer 3

Pooling of specialists

Organizational perspective across functions

Question 4

Disadvantages of functional structure

Answer 4

Differences in values & orientations - “silos”

Question 5

Advantages of divisional structure

Answer 5

Low corporate involvement in operational decisions

Question 6

Disadvantages of divisional structure

Answer 6

Duplication of functions can be very expensive

Dysfunctional competition among divisions

Difficult to maintain uniform corporate image

Question 7

Advantages of matrix structure

Answer 7

Range of responsibilities

Question 8

Disadvantages of matrix structure

Answer 8

Dual reporting relationships lead to uncertainty

Teamwork

Question 9

Advantages of holding company structure

Answer 9

Cost savings due to fewer corporate personnel and lower overhead

Divisional autonomy

Question 10

Disadvantages of holding company structure

Answer 10

Potential for synergies is very limited

Corporate office has little control and very dependent on divisional execs

Question 11

Advantages of SBU structure

Answer 11

Synergies within the unit through sharing core competencies

Question 12

Disadvantages of SBU structure

Answer 12

Corporate office further removed….

additional hierarchial level