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TYPES OF ORGANISATION STRUCTURE, Functional Organisation Structure,…
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Employees see that there is a promotional path in the firm. This encourages them to gain experience and skills, which can be used when future promotion opportunities arise.
It allows employees to become experts in a department, e.g. marketing. This improves productivity as employees can compete their duties faster and more efficiently.
Employees know who is responsible for what jobs in the firm and to whom their queries and concerns should be directed
Employees may work towards departmental objectives rather than the overall business goals. This can slow down business growth.
Communication can be slow between departments. This can mean the business is slow to react to change.
There may be a lack of trust between employees working in cross-departmental teams. This reduces productivity in the firm.
There may be duplicate departments working in different geographicareas, with employees doing the same job. This increases business costs.
Decisions made by senior management for the entire business can have a negative effect on local areas, e.g. redundancies. This can result in conflict between managers.
There may be poor communication between geographic units. The development of new products or processes may not be shared, which can result in organisational inefficiency.
Local managers provide local consumers with products that satisfy their needs. This helps to increase consumer loyalty.
There is often friendly competition between the geographic units. Each unit tries to outdo the others in terms of increasing sales and reducing costs. This helps to increase profits for the entire business.
Managers in geographic units make decisions on behalf of the business in their region. This helps them to prepare for future promotion opportunities.
As it is focused on specific products, this structure can meet consumer needs more effectively. The producer can react faster to changes in consumer demand.
The business can monitor the performance and profits of each product unit. It may decide to discontinue underperforming products or increase promotion of products that are performing well.
Employees working in product divisions can develop expert knowledge. This means they can give a higher level of customer service to consumers.
There may be a duplication of units with multiple people doing the same job,
e.g. marketing. This increases business costs
There may be rivalry between units as some of their products may be in direct
competition with each other.
Poor communication between the product units may result in the business missing opportunities in markets.
Employees feel valued when they are part of a project team. This motivates employees and increases productivity.
Working with employees on a cross-business project improves communication. It helps employees from various departments to work towards common organisational goals.
Project team members have a wide range of skills and experience. This can lead to better-quality decisions being made by the team
It may take the team longer to become productive, due to the lack of trust
between employees from different parts of the firm
Employees working in teams need training in areas such as teamwork and communication to help the team work effectively. These training programmes increase business costs.
It may take the team longer to become productive, due to the lack of trust between employees from different parts of the firm.