at the beginning of the paragraph, andat the end. Another result of these changes is the move towards more ‘boundaryless’ careers, which involve a sequence of job opportunities that go beyond single employment settings. These networks are not fully reliable at all times. vi. It may give rise to conflicts between divisions. Computer networks are susceptible to attack from network hackers, viruses, and other types of mischiefs either for making money or just for fun. Since these activities may be divided and assigned in different ways, there are many forms of organization structure. They can adapt and respond to the local situations with speed and accuracy. No one in the organization is responsible for the project cost and profit. Advantage and Disadvantage of I.M. Product Based Structure 10. i. SBU structure makes the task of planning and control by the corporate office more manageable. Do you think Toyota’s organizational structure and norms are explicitly formalized in rules, or do the norms seem to be more inherent in the culture of the organization? For instance, in an industrial enterprise, the major functions like production, finance, marketing and personnel may be grouped into different departments. It is difficult to pinpoint the exact characteristics of a boundaryless career, but in short it boils down to being constantly on the move. (iv) Motivation of specialists may pose another problem for the project manager. Geographical structure is followed in case of service organisations which have offices in different regions or geographical areas. Cross-hierarchical teams which include top executives, middle managers, supervisors, and operative employees adopt participative decision making. They, and no others outside the team, take responsibility for the quality of their products or services. A divisional structure encompasses a set of relatively autonomous units governed by a Corporate Office. The focus is more on personal development and less on a career in the traditional sense of moving on the corporate ladder in a specific field in one or two specific organisations/companies. 2. Functional structure is based on specialisation of functions. The design may often foster creativity and individualism. I try to use material not subjected to any copyright laws. For example, small firms tend to be functionally structured, big firms with multiple, products or services, use SBU structure or matrix structure. Almost all small scale industrial units or small organisations use simple structure. It utilises downward, upward and lateral communication networks for greater efficiency and quick decision-making. 8. (ii) The company can meet the demands of various regions more effectively. iii. Creating synergy is the process of putting two or more elements together to achieve a sum total greater than the sum total of individual elements separately. Self-managing teams have the following characteristics: a. A team-based organization is comparatively more structured as compared to a boundary less organization. In this form, regional offices are established as separate units. v. Career patterns and professional development in specialised area. There is integration of activities relating to a particular line of product. In addition to vertical communication, lateral and horizontal communications are quite common. Greater emphasis to the need of the customers may lead to less than optimum use of space, equipment and specialised personnel. I enjoy writing and although English is not my mother tongue, I decided to write in English to get a wider audience. The cons of management using the knowledge curve are: These cause price decreases. Each product division maintains its separate facilities and personnel. Expert Answer . Balance a traditional functional structure with a product structure (each project gets its own analyst, developer, tester, etc.) The breaking down of boundaries between an organization and its external customers has also caused those customers to take a more active role toward the organization and its management. It enables an organisation to quickly and effectively respond to changes in regional conditions. A boundaryless career has to be in line with your personality. However, management scholars have divided opinions over the effectiveness of virtual organizations because of the kind of trust that is required in creating such organizations. In the present era of globalisation, strategic alliances and organization-customer-supplier links have become significant sources for developing competitive advantage. The cons of management using the knowledge curve are: These cause price decreases. iv. viii. ... PROs were fine until the organizations realized how much money they can earn. Network structure is created around a central organisation that relies on other organisations to perform manufacturing, distribution, financing and other crucial business functions on a contract basis. In this system, an individual’s performance is appraised by his superior, peers, subordinates, and outsiders interacting with him. For instance, Life Insurance Corporation of India (LIC) has semi-autonomous divisions in different regions of the country. Describe the makings of the boundaryless organization. Within a boundaryless career short-term employments are common and also periods of unemployment have to be taken into account. Mechanistic structure is characterised by a greater degree of horizontal differentiation, high formalization (i.e., formal relations and communication), mostly downward communication, and little participation by low-level members in decision-making. - Boundaryless Organizations - Learning Organizations. iv. Similarly, matrix superior has to share the facilities with others. It is very useful where it is desired to introduce specialisation in the performance of various functions like production, finance, marketing, etc. It ensures quick delivery of products to customers in different areas, and intensive exploitation of local markets. vi. However, such a structure is not suitable for large organizations. Management, Organisation, Organisation Structure, Types of Organisation Structure. Separate strategic and operational control. A common theme of functional design proponents is the desirability of standardizing repetitive tasks and making them routine wherever possible. (iii) Product departmentation may sometimes lead to difficulties in coordination of certain specialised activities like marketing, financing and accounting. ADVERTISEMENTS: Everything you need to know about the types and classification of organisation structure. Including a link to relevant content is permitted, but comments should be relevant to the post topic; It is not suitable for enterprises with very diverse lines of businesses. While growth through expansion of same line of business forces an organization to organize on functional basis, growth through geographic and product diversification necessitates the adoption of divisional structure. The basic reason behind creating a virtual organization is to generate synergy through temporary alliances. A boundaryless organization is a modern approach in organization design. It combines the advantages of different alternative structures. It places attention and efforts on product lines and fixes responsibility for profits at the division level. The structure of an organisation is generally shown on an organisation chart or a job-task pyramid. It facilitates product expansion and diversification. It is the world’s largest supplier of athletic shoes and apparel. The matrix structure has the following advantages: i. Functional design fosters a limited point of view that focuses on a narrow set of tasks. Organic structure represents low horizontal differentiation, low formalization, free communication, and participation by low-level members in decision-making. The design enhances coordination and control within each of the functional area. Through this way, the horizontal boundaries are also minimised. Coordination and control take place through reciprocal adjustments among the members. You could say that a boundaryless career is a new form of career as opposed to a traditional career: at first glance chaotic and unpredictable transitions between jobs, organisations … Leads to competitive spirit within the organisation. Therefore, he must coordinate the instructions received from two or even more bosses. A core co… In matrix structure, a project manager is appointed to coordinate the activities of the project. They may compete with each other in certain areas. None of them is effective in certain situations. All the views on this weblog are mine. Divisional Structure 4. It encourages general management development. Functional structure is created by grouping the activities on the basis of functions required for implementing the strategy. v. Enhances development of general managerial talent. Sharply focuses on accountability for performance. Apart from basic and secondary functions, departments are also created for supporting activities to take the advantages of specialisation and to support the basic and secondary activities. It represents traditional pyramid shaped organisation which is rigid in nature. Informal communication plays a bigger role. It is a set of planned relationships between groups of related functions and between physical factors and personnel required for the achievement of organisational goals. According to Burns and Stalker, “Organic structure is one that is characterised by high degree of decentralisation and flexibility and under which individuals are more likely to work in a group setting rather than alone.” In an organic structure, the organisational members communicate across all levels of the organisation to obtain information. For example, Life Insurance Corporation of India runs its life insurance business on the basis of territorial divisionalisation in which the entire geographical area of the country has been divided into five zones—eastern, central, northern, southern, and western. If such a culture is not established, team-based organization tends to perform poorer than hierarchy-based organization. The examples of organic structures include project structure, matrix structure and network structure. a What are the pros and cons of seeking a boundaryless career Under the from MGT 3320 at Texas Wesleyan University Other companies can do very well in those areas in which the first group of companies feels handicapped. Uploader Agreement. Some companies can do something very well but struggle with most others. It may be noted that generally project teams are created along with the existing functional organisation. But in project structure high degree of uncertainty and insecurity is inevitable as the projects are for only specific period of time. Strategy formulation and its implementation functions are carried out almost by a single person as there is no scope for specialisation. Each unit is not a separate legal entity; it is still part of the organization. i. Each division caters to different customers and has different types of competition. Each regional office has independent functional departments to realise its objectives. The core of the network structure is the central organisation which coordinates relationships and activities with the other organisations in the network. The disadvantages of functional structure are as under: (i) Each department concentrates on a narrow range of activities relating to its function only. The relationships are not rigid; they are collaborative and redefined through interaction. Besides better coordination, it will also improve customer service. More disadvantages to Newskool as a boundaryless organization is communication and cultural issues. If you’re thinking about getting started in freelancing or going back to a day job after struggling with freelancing, give this post a read for a list of pros and cons of being self-employed. The most important problem is in the form of network security. The matrix structure, which is a combination of structures, has, therefore, become popular. The simple structure becomes inadequate as the business grows. Instead, it has limitless span of control without the existence of hierarchical control. Whether or not to outsource is a key question that companies must consider. 6. They plan, control, and improve their own work processes. The boundaryless organization does not operate according to tomes of planning documents, job descriptions, or tradition; instead, it regroups and responds to changes as they occur, pulling in the best talent for each issue every time. But where it is required to handle multiple products, functional organisation may prove to be insufficient. Report a Violation 11. Therefore, some people tend to call it T-form (technology-based) organization. (ii) It employ’s personnel with special abilities for meeting different customer requirements. For example, marketing department may be classified and grouped into advertising sales, market research, and so on. (iii) The project manager has to face a very unusual decision pressure that results from the severe penalties to be imposed because of the delay in completion of the project. The use of the experience curve makes the organization less versatile and receptive to business requirements. Join Yahoo Answers and get 100 points today. Sharing of information between the constituents of the network organisation is usually facilitated by electronic technology such as cell phone, computer, electronic mail, fax, etc. In this form, the organization is divided into several fairly autonomous units. iii. The functional structure is commonly found in small companies and also in large companies with single product line or narrow product ranges. It enables the company to cater to the needs of the different regions more effectively. organizations, along with its pros and cons ; Explain what is meant by boundaryless organizations and why they are important ; Explain the dimensions of restructuring ; 3 Traditional Organizational Structures. It is created to exploit fast changing opportunities and share skills and even facilitate access to global markets. Geographical or Territory Based Structure 11. This structure is popular with giant firms dealing in multiple products and operating in different geographical regions. May become difficult to achieve synergies across SBUs. To create paragraphs in your essay … In India, several companies like DCM, Gwalior Rayons, Century Mills and Voltas follow divisional structure to organise their operations. ii. Since these activities may be divided and assigned in different ways, there are many forms of organization structure. In performance appraisal, 360-degree appraisal system is used. D. ... organizational change is a process that involved effective products or services d. Change should moderate so as to not disrupt corporate cultural norms.. ... c. Effectively communicate the pros and cons of the expected change. Thus, each functional staff has two bosses—his administrative head and his project manager. In the boundary less organization, vertical boundaries are removed through flattening of organizational hierarchy. 5. It is employed where the unique characteristics of the product are of great significance and they require specialised machines and equipment and trained personnel. Entrepreneurial structure is quite simple in nature (that is why it is also called as simple structure) and is suitable for small organizations in which the entrepreneurs also work as chief executives. Recently, in telecommunication sector in India, many virtual organizations have been created to provide different services. Organization structure is the pattern in which various organizational activities are divided and assigned among positions, groups, departments, and divisions and the coordinating mechanism among these activities to achieve organizational objectives. This structure presents increased problems of top management control. The divisional structure can be organised in one of four ways by geographic area, by product or service, by customer, or by process. It does not encourage development of future managers. It can be tailored to meet the requirements of the particular project. Loyalty to the concern and obedience to superiors is highly insisted upon. It is found in almost every enterprise at some level in the organisation structure as it leads to better planning and control of the key functions on which the survival and growth of the enterprise depends. For example, if an organization emphasises product innovation and development in its strategy, its research and development may be given very high status. Thus, one can see marketing, materials management, production, finance and accounting, personnel and maintenance departments in the functional design of a company engaged in manufacturing. With the '9 -5' no longer being a strict boundary comes a series of pros and cons. Type # 1. Customer Based Structure 12. These organizations may take the form of a modular organization, strategic alliance, or self-managing teams. ii. It facilitates measurement of unit performance. Within this concept an employee is in this concept responsible for his own development and his employability. 0 0. The disadvantages of product based structure are as under: (i) It results in the duplication of personnel and physical facilities. However, it is not free from shortcomings. It is highly informal and the coordination of tasks is accomplished by direct supervision. Personnel are drawn from their respective functional departments. Whatever an organization’s formal organizational structure, there is an informal organizational structure that develops. It has some of the advantages of decentralisation. Chance of differences in image and quality may occur across divisions. What are the pros and cons of Toyota’s structure? 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