SESSION 2 : ORG.

STRUCTURE ARCHETYPES

ORGANIZATION DESIGN
FUNCTIONAL STRUCTURE (F-GROUPING)

Strengths Weaknesses
Set of choices regarding the allocation and the combination of ressources and activities
= Organizes employees around their speci c

➡ allocation of the activities to the units : labor division • Clear responsibilities and • Emergence of org. Politics

knowledges or ressources

➡ Coordination of the activities allocated to ≠ units : coordination,

labor division
• May cause decisions to pile
➡ Incentives in doing assigned activities : mechanism and culture • Economies of scales within on top

The rst level units are specialized by

the department
• Leads to poor horizontal
Objects :
functions or inputs

• In-depth knowledges and coordination

- structure (solution of the labor division and coordination)

Functions : set of activities grouped

- Mechanisms
skill dvlpmt
• Less innovation or
together by technical similarities

- Culture Interdependencies among functions

• Accomplish functional goals

responsiveness

• Best with only one or a few • Involves restricted view of

are managed by rules, procedure and hierarchy

products. goals
ORGANIZATION STRUCTURE

Components : - Reporting relationship - Departments -Integration systems

Lines : units in the hierarchal line

MODIFIED FUNCTIONAL STRUCTURE

Sta : units out of the hierarchical line = Functional structure + Integrators

VERTICAL ORGANIZATION
HORIZONTAL ORGANIZATION
Two possible positions of integrators w/o authority :

= Designed for e ciency

= Designed for learning
First line integrator reports directly to CEO and integrate the rst line units

Second line integrators reports to a rst line unit & integrate the sub-departments in that unit

Specialised tasks
Share tasks, empowerment

Strict hierarchy, many rules

Relaxed hierarchy, few rules
Integrators :

Vertical communication and reporting systems

Horizontal communication and face-to-face
➡ Le rôle de l'intégrateur est d'assurer la coordination entre les di érents départements impliqués dans le projet,
Few teams, task forces, or integrators
Many teams and task forces
de s'assurer que les objectifs du projet sont compris par tous les membres de l'équipe
Centralised decision-making
Decentralised decision-making
➡ Span the boundaries btw department

(Ex : military, government, manufacturing) (Ex : Google, Start-up) ➡ Do not have a formal authority over team members

➡ Formal authority : manager of the functional department

➡ Have to use expertise and persuasion to achieve coordination

Vertical linkages : Horizontal linkages :
- Extent communication and coordination btw top - Amount of communication and coordination of
and bottom of org.
activities across departments
DIVISIONAL STRUCUTRE (P/G/M-GROUPING)

- Designed primary for control

- Designed primary to achieve unity of e ort and = employés sont regroupés en fonction des Strengths Weaknesses
organisational objective
produits (P), des géographies (G) ou des • Suite to fast change and • Reduce economies of
Structural devices to achieve vertical linkages : marchés (M) qu'ils servent
unstable environment
scale in department

- Hierarchical referral
Structural devices to achieve vertical linkages : • Customer satisfaction
• Leads to poor
- Rules and plans
- Information systems
chaque division est responsable de ses • High coodination : coordination across
- Vertical informatif systems
- Direct contact
propres résultats nanciers et est considérée employee identify with divisions

- Task forces
comme une entreprise distincte au sein de their division
• Competitions among
- Full time integrator
l'organisation.
• Allow units to adapt to ≠
divisions and
- Teams
First level units are specialized by • Best for large org.
unwillingness to share
organisational outputs - strategic business • Decentralise decision ressources

areas (division)
making • Makes integration and
First level units are pro t and loss centers
standardisation across
Second level functions specialized by di cult
SIMPLE STRUCTURE
products, markets and customers.

Weaknesses Strengths
Comparative approach to structural design
• Flexibility/quick responds to • Hard to know which
change in customer demand
employee do what

Founder + small amount of employees

• Employee focus on product • Limited use of cross-abilities

Focus on technical/core activities
DIVISIONAL STRUCTURE W CENTRAL FUNCTIONS

dvlpmt (added value)

and dvlpmt

Informal mngmt
= divisional structure + functional structure

• Employee commitment, • Big product portfolio

Driven by personal values of the founder

loyalty, adaptability
• Di cult to coordinate
Decentralize to business units the functions that are speci c to each product/market

• High responsiveness
employees and customers

Centralize functions that are common and require economies of scaled functions that need and unitary control
• Strong clan and adaptive
Les divisions sont responsables de leurs résultats nanciers, mais des fonctions centrales telles que les
culture
Weaknesses
ressources humaines, les nances et les technologies de l'information sont gérées de manière centralisée pour
•  👍 for small companies
• Flexibility/quick responds to
l'ensemble de l'organisation.
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MATRIX STRUTURE
HORIZONTAL STRUCTURE

= Vertical + horizontal structure

Organizing employees around core processes

Developed to give equal emphasis and attention to product and function, or product and geography.
Process : organised group of related tasks and activities that work together to transform inputs into outputs that
create value for customers

Division and functional managers have equal authority

Employees report to two bosses Business process re-engineering : redesign of a vertical organisation alors horizontal work ow and processes

Conditions for the matrix structure : Key characteristics :

Cross-functional processes

1. Pressure to share resources

Self-directed teams

2. Pressures on two or more critical outputs required (ex : product and technical knowledge) Process owners

3. High need for interdependence and coordination

People on teams are given authority for decisions

Increase organisation’s exibility

Promotes openness trust and collaboration

Matrix structure = dual authority structure

➡ help to ensure a balance between vertical and horizontal aspects of organizations Strengths Weaknesses
• Flexibility and responsiveness
• Determining core processes is di cult and time consuming

Strengths Weaknesses • Focus on the production and value added

• Several adjustments

• Coordination to meet dual demands

• Dual authority cause confusion
• Broaden employees’ view of organization • Traditional managers may hesitate when they have to give
• Flexible. Sharing of HR’s across products
• Need good interpersonal skills and extensive goals
up power and authority

• Suited to complex decisions and unstable training

• Focus on teamwork and collaboration
• Requires signi cant training of employees

environment
• Time consuming
• Improve quality life of employees • Can limit in-depth skill dvlpmt
• Promote functional and product skill dvlmpt
• Need common understanding among participants

• Best in org. With multiple products • Requires great e ort to maintain power balance
VIRTUAL NETWORKS AND OUTSOURCING

COMPARING THE ARCHETYPES

= Horizontal coordination and collaboration beyond the boundaries of org with vendors, customers and
competitors

Outsourcing : contracting out aspect of work to other companies

con er une partie ou la totalité d'une tâche ou d'un processus à une entreprise ou à un individu en dehors de
l'entreprise.

Virtual network structure (or modular structure) : subcontracting many or most processes to separate
companies and coordinating activities from a small headquarters org.

groupe de personnes ou d'entreprises qui travaillent ensemble, mais qui ne sont pas situées physiquement dans
le même endroit
➡ Serves as a central hub with contracted experts

Strengths Weaknesses
• Enables org. To obtain talent and resources • Managers do not have hands-on control over many
worldwide
activities and employees

• Gives a company immediate scale and reach w/o • Requires a great deal of time to manage
huge investments
relationships

• Enables org to be highly exible and responsive to • Risks of organisational failure

changing needs
• Employee loyalty and corporate culture might be
• Reduces administrative cost weak

STRUCTURAL DESIGN : EFFICIENCY VS LEARNING

Hybrid structure : combine

characteristics of various approaches
tailored to speci c needs

Matrix structure looks good but they are di cult to implement and require a lot of natural collaboration
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 SCHÉMA

Functional structure (F-grouping)

Simple structure Horizontal structure

Modi ed functional structure

Divisional structure (P/G/M-grouping)

Divisional structure w central function Matrix structure

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