Reminders

1
Reminders

• C C Grocery case will be in your mail files by
  the end of the week.
• University Art Museum revisions are due by 200
  PM on Monday.
• Aquarius Advertising case is due by 200 PM on
  Monday. Think carefully about possible
  structural changes. Dont jump to conclusions
  about appropriate structures simply as a function
  of what you have read most recently.

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Review of last week

• What is structure?
• What influences the structure chosen?
• What are the options for structuring work?
• Functional Structures
• Task forces and task teams for coordination
• Divisional Structures
• What are the characteristics, advantages and
  disadvantages of functional/divisional
  structures?
• Questions?

3
Understanding and ManagingOrganizational
Structure B

• BA 152

4
From last weeks discussion

• Functional structures work well when the
  environment demands efficiency.
• Divisional structures work well when the
  environment demands responsiveness.

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But what happens if . . .

• The environment demands both efficiency and
  responsiveness?

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Other approaches to putting organizations together

• Hybrid Structures
• Matrix Structures
• Horizontal/Team Structures
• Network/Network/Virtual Structures

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A Hybrid Organization
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Building a Hybrid Organization
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A Matrix Organization
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Characteristics of Matrix Structures

1. Individuals or work units can have a combination
   of functional and divisional assignments.
2. Methods and procedures will change by assignment.

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Characteristics of Matrix Structures

1. Shared control and decision making between
   functional and divisional leaders
2. Dual reporting relationships and balance of power
   needed for success

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Characteristics of Matrix Structures

1. Competitive in dynamic environments requiring
   responsiveness and efficiency

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A Matrix Organization-NASA
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A Matrix Organization
15
A Matrix Organization
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Kenan-Flagler Business School Matrix Structure
DB
DB
DB
DB
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Can you imagine a 3-D Matrix Organization?
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Matrix StructuresAdvantages Disadvantages

• Advantages
• Can meet dual environmental demands
• Flexible use of resources
• Relatively quick reaction times
• Good training for both generalists and
  specialists

• Disadvantages
• Lose some economies of scale
• Difficult to maintain balance of power
• Having two bosses can be stressful
• Conflict resolution can be time-consuming
• Requires talented management

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Matrix StructureWhat happens when the economy
goes bad?
MFG
ENG
MKT
FA
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Matrix StructureWhat happens when the economy
looks good?
Project. Director
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Horizontal/Team Structures
Identification
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Characteristics of Horizontal/Team Structures

1. Organized around cross-functional core processes
2. Self-directed teams are the basis for the design
   of the organization.
3. Focus must be on the customer of the process.
4. Requires non-traditional organizational culture.

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Horizontal/Team StructuresAdvantages

1. Rapid response to changes in customer demands
2. Focus is on delivering value to the customer.
3. Employees have a broader view of organizational
   goals.
4. Promotes focus on teamwork/collaboration
5. Improves quality of work-life for employees

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Horizontal/Team StructuresDisadvantages

1. Identifying core processes can be difficult.
2. Requires major changes in most organizational
   systems and culture.
3. Requires managers to give up power/authority.
4. Requires significant training for employees.
5. Can limit in-depth skill development

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Kenan-Flagler Business School Horizontal/Team
Structure
BSBA
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A Modular/Network/Virtual/ Structure
Corporate Headquarters
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Kenan-Flagler Business School Modular/Network/Virt
ual Structure
Admissions
Placement
DEANS OFFICE
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A Modular/Network/Virtual StructureAdvantages

• Small organizations can obtain talent and
  assistance from anywhere.
• Organization can ramp up without huge
  investments in facilities.
• Increases organization flexibility and
  responsiveness.
• Reduces administrative overhead costs.

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A Modular/Network/Virtual/ StructureDisadvantage
s

• Little hands-on control of partners
• Expenses of establishing monitoring systems
• Reduced partner-employee loyalty
• Weakened corporate culture, if you can talk about
  a corporate culture at all.

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Is It the Wrong Structure? How can you tell?

1. If we replaced the people, would the problems
   remain?
2. Is the firm inefficient or inflexible?
3. Are decisions made too late?
4. Are decisions of poor quality?
5. Is there too much conflict between units?

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Aquarius Advertising Agency
Next Time