organizational structures
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TRANSCRIPT
08/04/2023
ORGANIZATIONAL STRUCTURES
Presented byAnusha Adhikar
Vidya Dhamija BBA 1 Semester
DEFINING ORGANIZATIONAL STRUCTURE
It defines authority, responsibility, and unity of command.
Organization structure helps to achieve organizational goals by grouping jobs, defining relationship between positions as well as who takes the responsibility in organization.
It describes each of the five forms of departmentalization
The formal arrangement of jobs within an organization.
FORMS OF DEPARTMENTALIZATION
Functional structureDivisional structureHybrid structureMatrix structureVirtual structure
FUNCTIONAL STRUCTURE
FUNCTIONAL STRUCTUREGrouping activities on the basis of the
functions of an organization is called functional departmentation.
The decision making is centralized at the top of the organization.
It is widely and easily used by those organizations which deals with one product.
ADVANTAGES
Specialisation – each department focuses on its own work.
Accountability – someone is responsible for the section.
Clarity – know your and others’ roles.
Co-ordination.
Closed communication could lead to lack of focus.
Departments can become resistant to change.
Gap between top and bottom level.
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
DIVISIONAL STRUCTURE It is suitable for medium sized to big
companies, expanding geographically or on customer base.
PRODUCT
CUSTOMER
GEOPRAPHI-CAL
DIVISIONAL
PRODUCT STRUCTURE
PRODUCT STRUCTUREIt is suitable for extremely large, complex
and multi-product organization .In this division requires the organization’s
work to be divided on the basis of its product.
Each division is responsible for its own performance and profitability.
It is based on output of the organization.With the divisional structure, each product
department has its own functional specialties.
ADVANTAGES
Clear focus on market segment helps meet customers’ needs.
Positive competition between divisions.
Better control as each division can act as separate profit centre.
Performance can be compared and analyzed
Co-ordination at high level is reduced.
Duplication of functions (e.g. different sales force for each division).
Negative effects of competition.
Lack of central control over each separate division.
Problem in decision-making and control.
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
GEOGRAPHIC DIVISION
Corporate office
Northern division
Eastern division
South west division
Canadian division
International division
GEOGRAPHIC DIVISIONS
It is common organization that operates over wide geographical area such as banking, insurance, transportation firms.
In this activities are grouped area-wise into zones, divisions, sections and branches on the basis of the distinct needs, tastes and facilities in a country.
ADVANTAGES
Serves local needs better.
Positive competition.
More effective communication between firm and local customers.
Conflicts between local and central management.
Duplication of activities and functions at different region.
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
CUSTOMER DIVISION
CUSTOMER DIVISIONS
The activities are grouped according to the customers the organization serves.
With this division, each department contains individuals who perform the necessary functions for a specific type of customer.
ADVANTAGES
Customers’ needs and problems can be met by specialists.
Beneficial for organization that serves diff. type of customer.
Limited view of organizational goals
Special treatment is required from various customer department .
Special facilities and manpower for certain customer group may be under employed.
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
HYBRID STRUCTURE
HYBRID STRUCTUREIt is form of departmentalization that adopts
both functional and divisional structure at the same level of management.
This structure is adopted to derive the benefits of economies of scale, and efficiency in resource utilization while the divisional structure is created to focus on product and services.
This structure have greater staff authority when compared to the divisional structure.
ADVANTAGES
Achieve a specific competency and economics of scale in functional areas with a focus on product , service and market.
Facilitates adaptability and flexibility in handling diverse product and services.
Develop large staff in the corporate level .
In case , it require co-ordination between a division and a corporate functional department may be slow to respond .
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
MATRIX STRUCTURE
MATRIX STRUCTUREMatrix organization is also referred to as a
grid organization or project or product management organization.
It can be termed both functional and divisional at the same time.
It has two chains of command- horizontal and vertical
ADVANTAGES
It facilitates decentralization
Of decisions.Brings horizontal co-
ordination.Effective use of human
resources.Individual become
specialist in two areas(function and product).
Administration cost are higher.
Individual reports to two bosses so they are unclear .
Individual engrossed with maintaining good relations.
ADVANTAGES AND DISADVANTAGES
DISADVANTAGES
VIRTUAL STRUCTURE
An organization that consists of a small core of full-time employees and that temporarily hires specialists to work on opportunities that arise.
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