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CHAPTER 6 - Coggle Diagram
CHAPTER 6
ORGANIZATIONAL STRUCTURE
ORGANIZATIONAL STRUCTURE
specifies the firm’s formal reporting relationships, procedures, controls, and authority and decision-making processes.
ORGANIZATIONAL CONTROLS
guide the use of strategy, indicate how to compare actual results with expected results, and suggest corrective actions to take when the difference between actual and expected results is unacceptable
TYPES OF STRUCTURE
Functional
Organizational structure based on functions; finance and accounting, production, personnel, sales and marketing
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Merit/positive: efficient, specialization of labor, excellent in stable environment.
Demerit/negative: communication barrier, measurement obstacles, highly formalized, lack of flexibility and responsiveness in volatile environment.
Divisional
Definition:Divisional organisation structure in which various departments are created on the basis of products, territory or region, is called a divisional structure. Each unit has a divisional manager, who is responsible for performance and has authority over their division.
Because managers in large companies may have difficulty keeping track of all their company's products and activities, a specialized departments may develop. These departments are divided according to their organizational outputs.
Examples include departments created to distinguish among product, geographical, market, customer, process.
Organizational structure based on division is in order to relax the rigid formalities of the functional structure.
Strategy Business Unit
as a fully-functional unit of a business(dept) that has its own vision and direction or business term used to present an independently managed entity or unit of a large company. to manage specific products, services, customers or a geographical area with objective of increasing profit
The SBU structure delegates authority and responsibility for each unit to a senior executive who reports directly to the chief executive officer
Matrix
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This structure uses permanent cross‐functional teams to integrate functional expertise with a divisional focus.
Employees in a matrix structure belong to at least two formal groups at the same time—a functional group and a product, program, or project team. They also report to two bosses—one within the functional group and the other within the team.
The most complex of all designs because it depends on both vertical and horizontal flows of authority and communication.
Widely used in many industries, including construction, health care, research and defense
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