Industrial and Corporate Change. Essay Example

Functional Structure

The functional organizational structure was successful and this is because the plan of this organization structure is planned such that there are separate departments that are required to report to the CEO of the company. Moreover, the success of the company was also because of the stable business environment. The company manufactures small quantity products that are similar and hence it becomes efficient.

A function organizational structure, additionally called a bureaucratic structure, breaks up the organization dependent upon field. Case in point, under this kind of organizational structure, one might allocate separate divisions for promoting, bookkeeping, and sales. From one perspective, this kind of organizational structure profits from having people altogether committed to one capacity. In a few cases, there might be cost effectiveness benefits in consolidating capacities. Nevertheless, this kind of managerial structure is inclined to clash. It might be troublesome to encourage solid lines of correspondence between functional divisions; if divisions are in separate areas; real correspondence could be hard, as comprehending the needs of the other division.

In a divisional structure on an organization, each department is accountable for its performance. Since there is no head office to report to, the divisions may fail to achieve the company’s goals and targets. This may be because of redundancy and inefficiency in their duties. For example, the departments may be offering their own training to new employees and conduct professional skills classes. Therefore, when the mistakes occur in the divisions, there is no central position to report to and hence this can lead to failure in the departments and to the entire organization.

References

Kreitner, R. &Kinicki, A. (2013). Organizational behavior (10th ed.). New York: McGraw-Hill Irwin. Chapter 17: Organizational Design, Effectiveness, and Innovation

Tushman, M., Smith, W. K., Wood, R., Westerman, G., & O’Reilly, C. (2010).                           .Industrial and Corporate Change, 19(5), 1331-1366.