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.,Merry Christmas,2017,.,.,Organisational structure,.,Organisational structure (P220),Organisational structure refers to the way tasks are divided up, how the work flows, how this flow is coordinated and the forces and mechanisms that allow this coordination to occur.,.,StategySizeEnvironmentTechnology,Factors affecting organization structure,.,StategyOrganization structure should follow strategyStrategy-structure relationship:Differentiation strategyStructure:low in specialization,formalization,centelization(flexibility)Cost-leadership strategyStructure:rigid, specialized, centralized(stability),Factors affecting organization structure,.,Size:Small organization:less division of labor, fewer rules and regulations, and more centralization.Large organization:more specialized, more standardized, and more decentralized.,Factors affecting organization structure,.,EnvironmentMechanistic organization: a rigid delineation of functional duties, precise job descriptions, fixed authority and responsibility, and a well-developed organizational hierarchy(stable environment).Organic organization: low specialization, formalization and centralization(dynamic and uncertain environment).,Factors affecting organization structure,.,Techonology 1)The number of levels in an organization increased as technical complexity increased.2) The ratio of managers and supervisors to total personnel increased as technical complexity increased.3) Firms employing routine technology tended to be standardized, while firms with less routine technology were more organic.,Factors affecting organization structure,.,Types of organizationa structures,.,1. Identify, with reasons, the structure that best describes the organization at present. Your description should illustrate the way in which activities are currently grouped together and provide reasons for this.Product/service structureFlat structureHybrid structure,.,2. Describe a form of structure that would be more appropriate for the organization based on the proposed new developments. Again, your description should illustrate the way the activities should be grouped and provide reasons for this.Hybrid structureMatrix structureProduct/service structureShamrock structure,.,Types of organizationa structures (P220),Divisioanl structureProduct/service structureFlat structure,Hybrid structureMatrix structureShamrock structure,.,Divisioanl structure,Known as the multidivisional form (or “M-form”) Each division contains all the necessary resources and functions within it to support that product line or geography (for example, its own finance, IT, and marketing departments).Controlled by central management; however, most decisions are left to autonomous divisions.Virgin Group is the parent company of Virgin Mobile and Virgin Records.,.,.,Divisioanl structure,Greater operational flexibility, failure of one division doesnt directly threaten the other divisions.Benefit from the use of the brand and capital of the parent company. Operational inefficiencies from separating specialized function; Increased accounting and taxes.Finance personnel in one division do not communicate with those in another division.,.,Product/service structure,.,.,.,Product/service structure,Assign employees, regardless of the type of their duties, according to the product or customer their work relates to. Each division can have its own marketing team, its own sales teamShapes around the grouping of the production and sales efforts of a business according to a particular line of goods or services.,.,Product/service structure,Help shorten product development cycles;help meet customer needs more effectively.Encourage positive competition between each department;Provide incentives for the team that produces the most viable products.Difficult to scale, and the organization may end up with duplicate resources as different divisions strive for autonomy;Suitable for larger companies with two or more product lines or markets. It is common in retila.,.,Geographical structure,This particular structure brings workers together in geographical divisions. The divisions establish themselves in the geographical area they serve, creating regional, national or international operations.Geographical units can be highly effective if they are located within the regions they serve and employ workers from the local labor pool.,.,.,.,Geographical structure,Work well together, engage in planning and decision-making together, and understand each others personalities and work styles.Quickly to changes in divisional goals and processes, and to bring everyone on board with new strategic initiatives.Decision-making effectiveness,sufficiently adaptable to local conditions, while still being true to its core business methodologies.,.,Geographical structure,Work well together, engage in planning and decision-making together, and understand each others personalities and work styles.Quickly to changes in divisional goals and processes, and to bring everyone on board with new strategic initiatives.,.,Duplicate both activities and infrastructure(marketing departments, producing, several distribution networks and several research departments). Economies of scale refers to increases in efficiency and savings as the same activities are performed in increasing scope. Different divisions might have to compete with one another for resources from the parent company. Also, employee expertise doesnt necessarily transfer between regions.,Geographical structure,.,Flat/Horizontal Structure,.,Flat/Horizontal Structure,.,Flat/Horizontal Structure,Responsibility, added bonus, reduces budget costs,self-motivation and teamwork.Equal voice in submitting new ideas and feedback;Discover new ideas that may lead to competitive success,increased involvement.Improves the coordination and speed of communication between employees, easier decision-making process among employees.,.,Flat/Horizontal Structure,Lack a specific boss to report , which creates confusion and possible power struggles among management. Produce a lot of generalists but no specialists. The specific job function may not be clear. May limit long-term growth of an organization; Larger organizations struggle to adapt the flat structure, unless the company divides into smaller, more manageable units.,.,.,.,.,Hybrid Structure (P249),.,.,Hybrid Structure,Increased Efficiency:Right quantity of work is assigned at the right time to the right professionals, thus making the optimum use of resources and prevention of wasteDevelopment of Cross-Functional Skills: formed considering the specializations as well as services,also results in minimization of projects costs, as resources can be shared.Flexibility: Healthy relationship between the senior managers and junior employees.,.,Hybrid Structure,Conflicts: employees become confused about the line of authority,also be confusion regarding the roles and responsibilities of each employee.Too much administration overhead: waste of time and effort.,.,Matrix Structure (P245),A structure is adopted that groups employees according to the functions and products.,.,.,.,Matrix Structure,A specialized crew can be chosen on the merits of their work and the functions that they carry forth.The needs of the project is the sole criteria for hiring of professionals. Thus allowing for more chances of success.Since the key people that are hired as a part of one team also work under other teams, it becomes proper balance between cost, time and performance.Less conflicts because of the hierarchical setup.,.,Project is completed on time and within the allotted budget,less chance of external factors affecting the project.A lot of different thinking forces are working on the project, and therefore the stress, authority, and problem-solving abilities become stronger.Confusion and conflict over factors like the sharing of resources;The cost is likely to increase,lot of project managers hired for the job.,Matrix Structure,.,.,The shamrock Structure,.,.,The first represents the core staff of the organization,they are likely to be highly trained professionals who form the senior management. The second leaf consists of the contractual fringe and may include individuals who once worked for the organization but now supply services to it,have a high degree of flexibility and discretionary powers.Flexible labour force. More than simply hired hands,these workers feel a sense of commitment, although part-time or intermittent is carried out to a high standard.,The shamrock Structure,.,.,3. Using the Contingency Approach, describe how the main situational variables of task, technology and size have influenced the new organization structure.Any ONE situational factors missing will cause re-do.,.,.,.,Contingency Approach (P252),No one best way to structure manage or control a business.,TaskTechnology Size,.,Mechanistic and Organic structure(P240),.,.,Determinants of Organisational Design,SizeHistorical backgroundGeographical dispersionTechnology,PeopleExternal environmentCommunications,
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