42 Questions
What is the primary goal of a functional structure for an organization?
To group people with common skills to increase effectiveness
How does a functional structure contribute to employee development and productivity?
By allowing people to supervise and control each other
What is the main challenge facing a successful organization with a functional structure as it grows?
How to keep control of increasingly complex activities
What is the foundation of horizontal differentiation in an organization?
Functional structure
How do people in a function who work closely together develop over extended time periods?
Develop norms and values that allow them to become more effective
What is the advantage of grouping people with common skills into separate functions within an organization?
Provides people with the opportunity to learn from one another and become more specialized and productive
What can pose a control problem within a functional structure?
Location problems
What is a possible solution to the problems of a functional structure?
Redesigning the functional structure to increase integration between functions
What does an increase in vertical differentiation involve?
Increasing the number of levels in the hierarchy
What type of structure is characterized by the splitting of the manufacturing function into several different product lines or divisions?
Product division structure
In a product division structure, what is responsible for coordinating with the central support functions like marketing and materials management?
Product division manager
What is a possible choice for an organization whose products are very complex technologically or whose characteristics change rapidly to suit changing customer needs?
Product team structure
What is the goal behind the change to a divisional structure?
To create smaller, more manageable subunits within an organization
What involves overlaying functional grouping of activities with some other kind of subunit grouping?
An increase in horizontal differentiation
What is responsible for overseeing the activities of the divisional managers in a mul divisional structure?
Corporate managers
What is a characteristic of a mul divisional structure compared to a functional and product division structure?
It provides additional differentiation and integration, which facilitate the control of more complex activities.
What can reduce the level of coordination and mutual adjustment among functions in an organizational structure?
Communication problems
What does an increase in horizontal differentiation involve?
Overlaying functional grouping of activities with some other kind of subunit grouping.
What is a primary advantage of a matrix structure?
Promotion of concern for both cost and quality
Why do people working in a matrix structure often complain about high levels of stress and uncertainty?
Due to the lack of a clearly defined hierarchy of authority
What is a characteristic of a mul divisional matrix structure?
High degree of coordination problems due to integration
In a hybrid structure, why might one product division choose to operate with a functional structure?
Due to the nature of the division’s products or the desire to be more responsive to customers’ needs
What is a primary advantage of using a network structure?
Lowering production costs due to reliable functional activity performance
What is a disadvantage of a network structure in certain situations?
The need for considerable trust between different groups to share ideas
Why might it be difficult for an organization using network structures to control a complex value-creation process?
Because managers lack the means to coordinate various network partners effectively
What is a characteristic of a boundaryless organization?
'Boundaryless' nature achieved through formal contracts and agreements
What does e-commerce primarily involve?
Trade that takes place between companies and customers using IT and Internet
What is a primary advantage of the hybrid organiza onal structure?
Using different types of organizational structure simultaneously
Why might an organization choose to use a mul divisional matrix structure?
To allow for more integration between corporate and divisional managers
What is an advantage of using network structures?
The decentralization to ensure smooth meshing of activities
What is the advantage of a mul divisional structure?
Profitable growth
What is one of the disadvantages of a mul divisional structure?
Transfer pricing issues
What is a characteristic of a product team structure?
Decentralized decision making
What is the main advantage of a geographic divisional structure?
Centralized control at one headquarters location
What characterizes a market structure?
Functional skills and competences aligned with product needs
What distinguishes a matrix structure from a product team structure?
Team membership in a matrix structure is not fixed
What is an advantage of a matrix structure over more traditional structures?
Reduced functional barriers and easier integration
What represents a potential disadvantage of a matrix structure?
Problem of subunit orientation
What is one possible challenge of a product team structure?
Increased functional barriers
What can be considered a benefit of a geographic divisional structure?
Decentralized control to regional hierarchies
What distinguishes a market structure from other structures?
Functional skills and competences aligned with customer needs
What is an advantage of a matrix structure?
Reduced functional barriers and easier integration
Explore the benefits of a multidivisional structure in organizations, including increased organizational effectiveness and enhanced control over divisional managers. Learn why most Fortune 500 companies opt for this structure to facilitate growth and expansion.
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