Organizational Structure 3

Organizational Structure 3 - o Competitive in dynamic...

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Understanding and Managing Organizational Structure Other approaches to structure: o Hybrid structures: Take a functional or divisional structure and implement some form of the opposite’s structure to make a hybrid model o Matrix structures: Equally efficient and adaptable A matrix, one side w/ functional groupings and one side w/ divisional groupings (ex. NASA) If any worker becomes temporarily unneeded (ex. if Project B requires less engineers than Project A), they go to holding area to study/ master their craft (workers are a valuable resource) Characteristics of matrix: o Individual can have combination of functional and divisional assignments o Procedures will change by project/ assignment o Shared control and decision making between functional and divisional leaders o Dual reporting relationships and power balance are needed for success
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Unformatted text preview: o Competitive in dynamic environments requiring both responsiveness and efficiency o Kenan-Flagler has a matrix structure • Advantages of matrix: o Can meet dual environmental demands o Relatively flexible use of resources o Relatively quick reaction times o Relatively good training for both generalists and spets • Disadvantages of matrix: o Lose some economies of scale o Difficult to maintain balance of power o Having multiple bosses can be stressful o Negotiations and conflict resolution can be time consuming and require talented management • What happens when economy goes bad? o Functional leaders gain more power (efficiency and cost cutting) • When economy grows? o Divisional leaders gain more power (more focus on profits)...
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