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1 Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall Organizational Theory, Design, and Change, 7e (Jones) Chapter 6 Designing Organizational Structure: Specialization and Coordination 1) A divisional structure is a design that groups people into separate functions or departments because they share common skills and expertise because they make use of the same resources. Answer: FALSE Page Ref: 148 Difficulty: Easy LO: 6-1 2) Functional structure is the foundation of horizontal differentiation. Answer: TRUE Page Ref: 148 Difficulty: Easy LO: 6-1 3) Functional structure provides people with the opportunity to learn from one another and become more specialized and productive. Answer: TRUE Page Ref: 150 Difficulty: Easy LO: 6-1 4) As an organization with a functional structure grows, the cost of each function's contribution to the development of each product becomes increasingly simple to measure. Answer: FALSE Page Ref: 151 Difficulty: Easy LO: 6-1 5) Servicing the needs of new kinds of customer groups and tailoring products to suit them are relatively simple in a functional structure. Answer: FALSE Page Ref: 151 Difficulty: Easy LO: 6-1 6) The higher the level of differentiation, the more complex the integrating mechanisms that managers need to use to control organizational activities. Answer: TRUE Page Ref: 153 Difficulty: Easy LO: 6-1 (B) and (D) could well apply. ABB is a typical case of matrix corporate organization developed around a multi-products/services conglomerate that didn't work that well in terms of control, efficiencies and building of a solid company culture and sense of belonging.The corporate matrix role created a feeling of a ship without captain. My personal belief is that a functional organization is the best option for costs segregation and control with the least cross contaminations, this in addition to all other processes and financial transactions, but more than this is the type of organization which best reflects the people natural tendency to be part of a defined organizational structure with clear lines of communication and view to the achievement; in few words is the organization which reward better the sense of ownership.........and a ship with a clearly identifiable captain. On multi-products organization again it is just a matter of allocating few costs here an there and possibly taking advantages of some economies of scale and some common functions. Learn how to develop a framework that gives members clear guidelines on building organizational structure, and keeping the organization functional.
What is organizational structure?By structure, we mean the framework around which the group is organized, the underpinnings which keep the coalition functioning. It's the operating manual that tells members how the organization is put together and how it works. More specifically, structure describes how members are accepted, how leadership is chosen, and how decisions are made. Why should you develop a structure for your organization?
When should you develop a structure for your organization?It is important to deal with structure early in the organization's development. Structural development can occur in proportion to other work the organization is doing, so that it does not crowd out that work. And it can occur in parallel with, at the same time as, your organization's growing accomplishments, so they take place in tandem, side by side. This means that you should think about structure from the beginning of your organization's life. As your group grows and changes, so should your thinking on the group's structure. Elements of StructureWhile the need for structure is clear, the best structure for a particular coalition is harder to determine. The best structure for any organization will depend upon who its members are, what the setting is, and how far the organization has come in its development. Regardless of what type of structure your organization decides upon, three elements will always be there. They are inherent in the very idea of an organizational structure. They are:
Governance The first element of structure is governance - some person or group has to make the decisions within the organization. Rules by which the organization operates Another important part of structure is having rules by which the organization operates. Many of these rules may be explicitly stated, while others may be implicit and unstated, though not necessarily any less powerful. Distribution of work Inherent in any organizational structure also is a distribution of work. The distribution can be formal or informal, temporary or enduring, but every organization will have some type of division of labor. There are four tasks that are key to any group:
Common RolesEvery group is different, and so each will have slightly different terms for the roles individuals play in their organization, but below are some common terms, along with definitions and their typical functions.
Although this list is pretty extensive, your organization may only use two or three of the above mentioned roles, especially at the beginning. It's not uncommon for a group to start with a steering committee, ask others to serve as board members, and then recruit volunteers who will serve as members of action committees. In this broad spectrum of possibilities, consider: Where does your organization fit in? Where do you want to be? Examples of StructureSo how can all of these pieces be put together? Again, the form a community group takes should be based on what it does, and not the other way around. The structures given are simply meant to serve as examples that have been found to be effective for some community-based organizations; they can and should be adapted and modified for your own group's purposes. A relatively complex structure
In diagram form, a complex organization might look like this: And in diagram form:
As smaller size means fewer people, these groups are usually less complex, as they have less need for a formal hierarchy and instead have governance that is consensus-based. A diagram of such a small group might look something like this, with each of the circles representing an individual member: What type of structure should you choose?First, decide upon the formality your organization will have. The following table, adapted from The Spirit of Coalition Building can help you make this first decision.
Organizational structure is something that is best decided upon internally, through a process of critical thinking and discussion by members of the group. In your discussions, your answers to the following list of questions may guide your decisions.
In SummaryStructure is what ensures that your organization will function smoothly and as you intended. You should think about structure early in the development of your organization, but be aware that the type that fits best may change as your organization grows. Which of the following is not an advantage of a functional type of organizational structure?One disadvantage of a functional structure is that differences in functional orientation may impede organization coordination and communication. Operational decision making in a large business places excessive demands on top management of the firm.
What are characteristics of simple structure in business organization quizlet?A simple structure is not elaborate. It has a low degree of departmentalization, wide spans of control, authority centralized in a single person, and little formalization.
Which of the following are considered disadvantages of a divisional organization structure?These are some disadvantages of a divisional structure: It risks accidental duplication of resources. It encourages poor communication and low interaction among different departments. It encourages internal competition across departments rather than uniting the company against outside competitors.
Which of the following is the major disadvantage of a functional structure?Answer and Explanation: One disadvantage of a functional organizational structure is d. It does not facilitate a straightforward approach to supervision and management. The functional organizational structure is complex because the employees of a corporation receive numerous instructions from various functional heads.
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