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ORGANIZATIONAL CONTROL AND STRUCTURE (Marketing for tracking new product…
ORGANIZATIONAL CONTROL
AND
STRUCTURE
Definition
Help company to assign a task that define roles, responsibility and supervision
Organizational Structure
Structural stability
Structural felxibility
Effective structures
Organizational Control
Purpose
Guide use of strategy
Indicate how to compare actual results with expected result
Suggest corrective actions
Types
Strategic controls
Opportunities in its external environment
Competitive advantage
Financial controls
Accounting-based measures (Return on assets, investment)
Market-based measures (Economic Value Added, EVA)
Evolutionary Patterns of Strategy and Organizational Structure
Firm grow in predictable patterns
volume
geography
integration (vertical, horizontal)
through products / business diversification
Relationships between Strategy and Structure
Strategy and structure have a reciprocal relationship
Implementation
Functional Structure
Integrated cost leadership / differentiation strategy
Used frequently in global economy although difficult to successfully implement
Integrated form of functional structure
Decision-making patterns that are partially centralized and partially decentralized
Semi-specialized jobs
Rules and procedures that allow both formal and informal job behaviors
Multidivisional Structure
Cooperative Form
Related-Constrained Strategy
Share divisional competencies which develop economies of scope
Emphasizes centralization on marketing, strategic planning, human resources
Emphasize overall corporate performance
Strategic Business-Unit (SBU) Form
Related-Linked Strategy
SBU form levels : Corporate headquarters, Strategic Business Units (SBUs), SBU division
Division within SBUs share product or market competencies
Competitive Form
Unrelated Strategy
Complete independence among firm's divisions
Benefits from internal competition
Flexibility
Challenge status quo
Motivates effort
Basic Structure Types
Simple structure
Functional Structure
Multidivisional structure (M-form)
Marketing for tracking new product ideas
New product R & D is emphasized
Functions are decentralized
Formalization
Structure is organic
Job roles
