The Different Ways Organizations Can Be Structured and Operated

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The Different Ways Organizations Can Be Structured and Operated

There are four major ways a company - organization can be structured

and operate. P.C.G (o) Ltd I would dare say that is structured and

operates with the functional structure. In order to make it clear and

understandable I am analyzing here below the four ways that

organizations can structure and operate. We will observe that all four

structures have there advantages and disadvantages. In order also to

assist you understand better the differences of the four ways that

organizations can be structured see in Page 4 & 5 Figures 1,2,3 which

are the layout of the organization charts for each structure:

1. Functional

2. Divisional

3. Hybrid

4. Matrix

1. Functional Structure involves the departmentalization in which

positions are grouped according to there main functional- specialized

area. To make it more clear and for example, the Production or

operations function combines activities directly related to

manufacturing a product or delivering a service. Marketing focuses on

the promotion and sale of products and services. Human resources are

responsible for attracting, retaining, and enhancing the effectiveness

of organization members. Finance is concerned with obtaining and

managing financial resources.

The advantages and Disadvantages of this structure are as follows:

Advantages:

In depth Development of expertice

Clear career path within function

Efficient use of resources

Possible economies of scale

Ease of coordination within function

Potential technical advantage over competitors

Disadvantages:

Slow response time on multifunctional problems

Backlog of decisions at top of hierarchy

Bottlenecks due to sequential tasks

Restricted view of organization among employees

Inexact measurement of performance

Narrow training for potential managers

2. Divisional structure is a type of departmentalization in which

positions are grouped according to similarity of products, services,

or markets. With the divisional structure, each division contains the

major functional resources it needs to pursue its own goals with

little or no reliance on other divisions.

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