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Organizational Designs - Coggle Diagram

- - - - Easier funding
      - Customer preference
      - Better Workers
      - Beating competitors
      - High cost on local
    - - Outsource
      - Hired expertise
      - Cheap and Flexible
- - - - Sharing of costs and skills
      - Access to global markets
      - Faster response to market changes
    - - Difficult to know where one company ends and another begins
      - Loss of operational control
      - Loss of strategic control over emerging technology
  - - - Reduced agency costs
      - Reduced transaction costs
      - Less conflict of interest
    - - Relationship become more important than profits
      - Conflicts are resolved through ad hoc negotiations
      - Relationships are driven more by social connections than by needed competencies
  - - - encourage information sharing and accelerates organizational learning
      - maintain full strategic control over most critical activities
      - achieves best-in-class performance at each link in the value chain
      - direct a firm managerial and technical talent to the most critical activities
    - - inhibits common vision through reliance on outsiders
      - leads to erosion of cross-functional skills
      - diminished future competitive advantages if other competencies are outsourced
      - decrease operational control and potential loss of control over a supplier
  - - - Higher level of trust and shared interest
      - Shift in philosophy from executive development to organizational development
      - Greater use of teams
      - Flexible, porous organizational boundaries
    - - Leverage the talents of all employees
      - Enables a quicker response to market changes through single goal focus
      - Can lead to coordinated win - win initiatives with key suppliers
    - - Difficult to overcome political and authority boundaries inside and outside the organization
      - Time consuming
      - Lacks of high level of trust
- - - - Highly informal
      - Coordination of tasks by direct supervision
      - Centralized decision making
      - Few rules and regulations
      - Little specialization of tasks
      - Informal reward system
    - - Responsibilities not understood
      - Taking advantages of lack of regulations
      - Limited opportunities for upward mobility
  - - - Definition: where business in a corporation portfolio are the result of unrelated division
      - Characteristics:
        
        Variation of divisional structure
        
        Similarities are few, synergies are limited
        
        Autonomous operating divisions
      - Advantages:
        
        Cost savings due to fewer personnel and lower overhead
        
        Divisional autonomy increases motivation level of divisional executives
        
        Quicker response to changes in the market environment
      - Disadvantages:
        
        Potential for synergies is very limited
        
        Corporate office has little control
        
        Difficult to replace key divisional executives if they leave
    - - Separation of strategic & operating control
      - Quicker response to changes in the market environment
      - Fewer problems sharing resources across functions
    - - Very expensive duplication of functions possible
      - Dysfunctional competition among divisons
      - Too much focus on short-term performance
    - - Relatively autonomous divisions
      - Governed by a central corporate office
      - Decision-making delegated to lower-level managers
    - - Definition: Similar products or markets grouped into units to achieve synergy
      - Characteristics
        
        Variation of divisional structure
        
        Similar divisions grouped into homogenous units
        
        Synergies through related diversification (sharing resources, competencies)
      - Advantages
        
        Planning and control by corporate office
        
        Decentralization of authority
        
        Quicker response to market changes
      - Disadvantage
        
        Difficulty in achieving synergies
        
        Increased personnel and overhead expenses
        
        Corporate office far from divisions
  - - - Functional departments, product groups & geographical units can be combined
      - Individual have two managers
      - Project managers & functional managers share responsibility
        
        Product managers handle development, manufacturing and distribution on their own line
        
        Geographical manners are responsible for profitability of the business on their regions
    - - Increase market responsiveness, collaboration & synergy
      - Allows more efficient utilization of resources
      - Increase professional development
    - - Dual reporting relationship lead to uncertainty
      - Can lead to power struggle & conflict
      - Decision making takes longer
  - - - Organization is small with a single or closely related product/service
      - Specialists in various functional areas
      - Chief executive responsible for coordination and integration
    - - Enhanced coordination and control
      - Centralized decision making
      - Enhanced organizational-level perspective
    - - Impeded communication and coordination ("silos")
      - May lead to short-term thinking
      - Difficult to establish uniform performance standards
  - - - need for division of tasks into meaningful grouping
      - need to integrate these groupings for maximum efficiency and effectiveness