Pooling of specialists enhances functional

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Pooling of specialists enhances functional coordination and control. Career paths and professional development in specialized areas are facilitated. Disadvantages Differences in functional-area orientation impede commun-ication and coordination. Functional-area conflicts may overburden top-level decision makers. Difficult to establish uniform performance standards. Tendency for specialists to develop short-term perspective and overly narrow functional orientation.
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Divisional/SBU Structure CEO SBU A Gen Mgr SBU B Gen Mgr SBU C Gen Mgr Marketing Production Finance Marketing Production Finance Marketing Production Finance
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Divisional/SBU Structure Advantages Minimizes problems associated with sharing resources across functional areas. Quick response to environmental changes. Increased focus on products and markets. Facilitates development of general managers. Disadvantages Increased costs through duplication of personnel, operations, and investment. Competition among divisions may detract from overall corporate performance. Overemphasis on short-term performance.
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Matrix Structure CEO Marketing Manager Engineering Manager Production Manager Project A Mgr Project B Mgr Project C Mgr
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Matrix Structure Advantages Improves flexibility, coordination, and commun- ication. Allows more efficient utilization of resources. Increased market responsiveness through collaboration and synergies among professional colleagues. Increased professional development. Disadvantages Dual reporting can result in uncertainty regarding account- ability. Intense power struggles may lead to increased levels of conflict. Working relationships may be more complicated and human resources duplicated.
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Horizontal Organization -- Process Structure -- CEO Process A Mgr Process B Mgr Process C Mgr
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