OTD Chapter 6 Flashcards
Functional structure
Structure that groups people together on the basis of their common expertise and experience, or because they use the same resources.
Central problems in a functional structure
Communication problems Measurement problems Location problems Customer problems Strategic problems
Communication problems - functional structure
As more organizational functions develop, each with its own hierarchy, they can become increasingly distant from one another.
Measurement problems - functional structure
To exercise control over a task or authority, there has to be a way to measure it.
Location problems - functional structure
As a company grows, it may need to set up shop and establish manufacturing or sales facilities in different geographic regions to serve customers better.
Customer problems - functional structure
The ability to identify and satisfy customer needs may fall short and sales opportunities are lost.
Strategic problems - functional structure
As an organization becomes more complex, top managers may be forced to spend so much time finding solutions to everyday problems in coordination, that they have no time to address the longer-term strategic problems facing the company.
Complex structures is a result of three choices
Vertical differentiation
Horizontal differentiation
Integration
Divisional structure
Structure in which functions are grouped together according to the specific demands of products, markets, or customers.
Product structure
A divisional structure in which products are grouped into separate divisions, according to their differences or similarities.
Three kinds of product structures
Product-divisional structure
Multidivisional structure
Product-team structure
Product-divisional structure
A structure in which a centralised set of support functions service the needs of a number of different product lines.
(E.g., soup, frozen vegetables, baked goods.)
Multidivisional structure
A structure in which support functions are placed in self-contained divisions (S&M, R&D, Finance).
Product-team structure
A structure in which specialists from the support functions are combined into product-development teams that specialize in the needs of a particular kind of product.
Geographic structure
A structure in which divisions are organization according to the requirement of the different locations in which the organization operates. (Central support function)