BU398 Lecture 3: Lecture 3 - Org. Structure Part 1
Document Summary
Required work activities: departments are created to perform tasks considered strategically important to the company. Reporting relationships: how departments should fit together in the org. hierarchy. Departmental grouping options: different possible ways of grouping employees in departments. Activities are grouped together by common function. Most effective when: org. needs to be controlled and coordinated through vertical hierarchy, when efficiency is important. Strengths: maximizes economies of scale within functional departments, enables in-depth knowledge and skill development, best with limited number of products. Weaknesses: slow response time, hierarchy overload, less innovation. Activities are grouped together by product/org. output. Strengths: flexibility and adaptability, high coordination across functions, decentralizes decision-making.
