Organizational Structure Part 5

• Departmentalization by Business Function
• Advantages
• Ideally suited to a stable organizational environment
• Requires less internal coordination
• Facilitates the development of expertise
• Not dependent on interpersonal and managerial skills
• Disadvantages
• Response time to issues can be slow
• Bottlenecks occur due to sequential nature of the organizational decision making process
• Innovation may suffer
• Strong demand on senior managers to coordinate
• Conflict emerges from prioritization issues
• Departmentalization by Product
• Advantages
• Ideal for organizations experiencing fast change
• Clearly Defined Roles & Responsibilities
• Facilitates High Product Visibility
• Disadvantages
• Allocation of resources can become a political battle for priority
• Coordination of activities can decline
• Expertise may decline
• Departmentalization - Matrix
• Expertise can be realized across the organization to tackle organizational projects
• Project Teams can be drawn from various Functional Units
• Project Manager Appointed to Operate a Project
• Solid lines indicate line of command
• Dashed lines indicate shared authority between project manager and functional manager
• Advantages
• Allocates Expertise Across the Organization
• Greater Flexibility in Tackling Organizational Issues
• Realizes Top Management Expertise
• Develops Employee Skills
• Disadvantages
• Encourages Power Struggles
• Highly dependent on the interpersonal skills of staff
• Project manager may assume to much authority
• Project Manager may isolate other members
• Costly to implement
• Networks
• Internal Network
• Dynamic - Loosely Completed Network
• Vertical Network
• Virtual Network:   "The virtual organization is a temporary network of companies that come together quickly to exploit fast-changing opportunities"
• Virtual
• Technology
• Opportunism
• Trust
• No Borders
• Excellence

Until next time...






Sheryl Tuchman, SPHR, SHRM-SCP
http://tools2succeed.com/