STRATEGY & ORGANISATIONAL STRUCTURE

Question 1

What is the functional structure

Answer 1

Functional Structure (Where you group together the: finance, marketing and operations department together)

Question 2

What are the benefits of functional structure

Answer 2

Consistency across an organisation (e.g. in accounting practices, brand image)

Realise economies of scale

Improved intra - departmental communication

Question 3

What are the costs of functional structure

Answer 3

Difficult communicate and coordinate across departments

Different departments develop sub-cultures

Question 4

What is product strategy

Answer 4

Product strategy (Departments that work on each strategy):

Question 5

What are the benefits of product strategy

Answer 5

Improved design (i.e. market research shared with operations)

Different products are at different points in the life cycle, therefore the strategy will be different for each product

Question 6

What are the costs of product strategy

Answer 6

Difficult to share good practice

Duplication of roles (i.e. marketing)

Question 7

What are the benefits of a regional structure

Answer 7

Useful when undertaking a traditional or multinational strategy, when products require high degree of local responsiveness

Decision making decentralised to experts

Question 8

What are the costs of regional structure

Answer 8

Difficult to achieve global economies of scale

Question 9

What are the benefits of the matrix structure

Answer 9

Improves interdepartmental communication

Question 10

What are the costs of the matrix structure

Answer 10

Potential conflicts between departments and projects