Organizational Structure

Presented by: Team D

Ann Blasius, Jolene Cabazos, Julie Comeau,
Ryan Scalmanini and Nora Trombley
MGT/330 Management: Theory, Practice &
Application

Professor Darin Jones

December 1, 2008
As an organization that utilizes the matrix structure
of management, communication is the key to
success

At Boeing the lines of communication flow more

freely with this structure and thus allows for
increased accountability both from the project
teams and project managers.
 Boeing’s Organizational structure
• Boeing uses the Matrix Structure:
- Each Department has a Senior Vice President

o Business Development and Strategy

o Communications
o Engineering, Operations & Technology
o Finance
o Human Resources and Administration
o Internal Governance
o International
o Law Department
o Public Policy
 Organizational structure cont.

• Boeing uses Specialization:

- Different individuals in different units perform specific tasks

o Executive council
o Capital Corporation
o Commercial Airplanes
o Engineering, Operations, and Technology
o Integrated Defense Systems
o Shared Services Group
 Organizational structure cont.
• Boeing uses Corporate Governance:

• The firm is overseen by its executive staff and board of directors.

The executive staffs and board of directors use integration to
run the organization.

• Boeing’s use of integration, brings the Executive council, Capital

Corporation, Commercial Airplanes, Engineering, Operations, and
Technology, Integrated Defense Systems, and Shared Services Group
together via the Senior Vice Presidents to make decisions about how
to stay competitive and increase revenue.
 Organizational structure cont.
• Boeing’s span of control is wide:
-163,851 employees
- In 70 countries

• Boeing is a Centralized Organization:

- high-level executives make most decisions and pass
them down to lower levels for implementation.
 Boeing’s Organization Chart
W. James McNerney, Jr.
Chairman, President, and CEO

Michael J. Cave, Tom Downey,

Sr. Vice President Sr. Vice President
Business Development and Strategy Communications

John Tracy, James Bell,

Sr. Vice President Engineering, Operations, Executive Vice President
&Technology Chief Financial Officer

Richard Stephens, Wanda Denson-Low

Sr. Vice President Sr. Vice President
Human Resource & Administration Internal Goverence

Shep Hill, J. Michael Luttig,

President Sr. Vice President & General Counsel
Boeing International

Timothy Keating,
Sr. Vice President
Public Policy
 Vertical Structure
• Has hierarchy levels where top supervisors make decisions for
organization

• Uses Differentiation - the organization is composed of many

different units that work on different kinds of tasks, using different
skills and work methods.

• Uses Integration - the differentiated units are put back together so

that work is coordinated into an overall product.

• Authority trickles down organization from top to bottom

• CEO and CFO and COO
• President and Vice President
• Department Heads
 Horizontal Structure
• Organization is subdivided or departmentalized into smaller units or
departments.
• Each Department has a Department head that oversees that division and all
employees in the division.
• Lower level management reports to department head who reports to CEO,
CFO, or COO.
• This structure works to create individual and specific divisions that oversee
specific functions of the organization.
 Analysis of Vertical and Horizontal
Structure
• Vertical and Horizontal Structure often work synonymously.

• Vertical Structure establishes top supervisors who make decisions about

how to run the organization.

• Horizontal Structure breaks down the organization into smaller

divisions overseen by department head who report to top supervisors.

• Vertical Structure dictates how authority is delegated (top to bottom)

• Horizontal Structure dictates how each division is integrated into the

organization.
 Boeing’s Organizational Functions

• Human Resources – develop and implement company growth

activities.

• Marketing Department – leads strategic direction, revenue,

market share and brand development.

• Operations Department – responsible for purchasing, quality

control, logistics, evaluations, etc.
 Boeing’s Senior Management

Needs to:
• Support matrix structure and only implement where it adds
value.

• Remove barriers - cultural and others.

• Supply clear direction.

 Leadership and Innovation
At Boeing each organizational function has it’s own purpose
and place in the management of the company.

The company as a whole is ever striving to improve at all

levels.

They realize that their strength comes from their employees,

and that management at all levels must continue to support the
many ongoing efforts by its teams.
 Boeing’s Culture
o Values

o Leadership

o Integrity

o Quality

o Customer Satisfaction

o Enhancing Share Holder Value

 Organizational Design Elements
• Matrix Organization:
o Geographic
o Functional
o Customer-Based
o Product
o Service
o Hybrid
o Matrix
o Marketing channels
o Departmentalization
 Matrix Structure
• Boeing uses the Matrix structure to runs its
organization.

- Different divisions run independently due to the diversity of Boeing’s

products.

- Boeing is an organization that has constant changes in technology, which

means that collaboration amongst the divisions is essential for success.

- Boeing is a network organization with independent, single-function

firms that collaborate on a good or service.

-Resource utilization is efficient because key resources are shared across

several important programs or products at the same time.
 Geographic's
• Based out of Chicago, Boeing has customers all over the
world.
– Boeing has sales offices throughout the world to cater to their
customers.
• Boeing’s span of control is wide:
- 163,851 employees
- In 70 countries
• This ensures customer satisfaction and proper communication
between both parties.
 Product

– Boeing’s products are very specific to each customer,

especially in defense systems for governments.

– With a Matrix structure, Boeing is able to design and

manufacture products that are one of a kind while still
allocating resources very well.
 Conclusion
We value the skills, strengths, and perspectives of our diverse
team.

We will foster a participatory workplace that enables people

to get involved in making decisions about their work that
advance our common business objectives (Boeing, 2008).
 References
Boeing, (2008). Boeing; About Us; Retrieved on November 29, 2008 from http://
www.boeing.com/aboutus/culture/index.html#diver
Dumaine, B. (1994). THE TROUBLE WITH TEAMS. Fortune, 00158259, Vol. 130,
Issue 5; Retrieved on November 28, 2008 from http://
www.mph.ufl.edu/events/seminar/TroublewithTeams.pdf
Peters, T., Waterman, R. (2004) In Search of Excellence pg 307 p2. Retrieved from
http://books.google.com on November 29, 2008.
Almojuela, B. (2000). The Core of Planning Process. (1-5).
http://www.alignent.com/resources/benalmojuela-qa.htm
Galligan, M. (1998) Policy/Management Track: Strategic Planning. (4) Kansas
Legislative Research Development.
http://www.ncsl.org/programs/lis/nalit/galligan1.htm
Bishop, L.A., (2001) Shaping the corporate ownership structure to build shareholder
value. Strategic Investor Relations 1.2 p 47(4) Retrieved on November 29, 2008
from General One File UOP.