1. CREATING EFFECTIVE
ORGANIZATIONAL DESIGN

2. Traditional Forms of Organizational
Structure
• Organizational Structure refers to formalized patterns of
interactions that link the tasks, technologies, and people of a
firm.
• Structure are designed to ensure that resources are used
most effectively toward accomplishing an organizations
mission.
• Structure provides managers with a means of balancing two
conflicting forces: a need for division of tasks into
meaningful groupings and the need to integrate
such groupings in order to ensure organizational
efficiency and effectiveness.
• Structure identifies the executive, managerial, and
administrative organization of a firm as well as indicating
responsibilities and hierarchical relationships.

3. Patterns of growth of large
Corporations
Strategies leading to new
structure
Dominant growth path
for U.S firms

4. SIMPLE STRUCTURE

5. Simple Organizational Structure

6. FUNCTIONAL STRUCTURE

7. Functional Organizational structure

8. Functional Structure
Advantages Disadvantages
•Pooling of specialists •Differences in functional area
enhances coordination and orientation impede
control communication and
•Centralized decision making coordination.
enhances an organizational •Tendency for specialist to
perspective across functions. develop short term
•Efficient use of managerial perspective and narrow
and technical talent. functional orientation.
•Functional areas may
overburden toplevel decision
makers.
•Difficult to establish uniform
performance standards

9. DIVISIONAL STRUCTURE

13. Divisional Structure
Advantages Disadvantages
•Increases strategic and •Increased cost incurred
operational control, through duplication of
permitting corporate-level personnel, operations, and
executives to address strategic investment.
issues. •Dysfunctional Competition
•Quick response to among divisions may detract
environmental changes. from overall corporate
•Increased focus to products performance
and markets. •Difficulty in maintaining
•Minimized problems uniform corporate image.
associated with sharing •Overemphasis on short-term
resources across functional performance.
areas.
•Facilitates development of
general managers.

14. MATRIX STRUCTURE
use to combine products groups and geographical units.

15. Matrix Structure
Advantage Disadvantages
•Increases market responsiveness •Dual reporting relationships can
through collaboration and synergies result in uncertainty regarding
among professional colleagues. accountability.
•Allows more efficient utilization of •Intense power struggles may lead to
resources. increased levels of conflict.
•Improves flexibility, coordination and •Working relationships maybe more
communication. complicated and human resources
•Increases professional development duplicated.
through a broader range of •Excessive reliance on group
responsibility. processes and teamwork may impede
timely decision making.

16. INTERNATIONAL OPERATIONS:
IMPLICATIONS FOR
ORGANIZATIONAL STRUCTURE

17. 3 major contingencies that seem to
influence the structure adopted by
firms with international operations.
 The type of strategy that is driving a firm’s
foreign operations
 Product diversity
 The extent to which a firm is dependent on
foreign sales.

18. The primary types of structures to
manage a firms international
operations:
 International Division
 Geographic-area Division
 Worldwide Functional
 Worldwide product Division
 Worldwide Matrix

19. Boundaryless Organizational
Design
 Replace the traditional forms of
Organizational structure.

20. 3 different types of boudaryless
Organization
 Barrier-free Organization
 Modular Organization
 Virtual Organization

21. Thank you