Structural implemen

tation
Structure
• Arrangement of tasks and sub tasks required to imp
lement a strategy
• Organization structure is an outline of authority and
responsibility relationship among different job posi
tion
• There are two kinds of structure ; vertical and horiz
ontal structure
Kinds of stru
cture
Vertical structure
Horizontal structure
Vertical strategy
• The vertical dimensions is characterized by:
• Specialization of tasks
• Chain of command
• Formal reporting relationships
• Grouping of individuals into departments
• Upward and downward communication
Horizontal strategy
• The main characteristics of horizontal dimensions a
re
• i. Sharing of tasks
• ii. Sharing of information
• iii. Decentralized decision making
• iv. Focus on learning
Types of organization struc
ture
• Entrepreneurial structure
• Functional structure
• Divisional structure
• SBU structure
• Matrix structure
• Network structure
Entrepreneuri
al structure
Its an elementary form of structu
re
Organization owned and manage
d by one person
Typically organization serving sin
gle product or serve local market
Entrepreneurial structure

Advantage Disadvantage
• Quick decision making • Excessive reliance
• Timely response to envi • Many divert attention
ronment changes • Increasing inadequate f
• Informal and simple org or future requirement if
anization systems business expands
Functional st
ructure
Functional structure seeks to dist
ribute decision making and opera
tional authority towards each de
partment
Functional structure

Advantage Disadvantage
• Efficient distribution of • Creates difficulty in coo
work through specializa rdination
tion • Creates only narrow sp
• Delegation of day to da ecialization
y operational functions • Leads to conflict among
• Provide time for top ma Line, Functional and Sta
nagement to focus on s ff
trategic decisions
SBU structure
Strategic business unit
Defined as any part of a business
organization which is treated sep
arately for strategic management
purpose
SBU are created due to difficulty i
n top management to exercise a s
trategic control over a decision.
 SBU

Advantage Disadvantage
• Establishes coordination • There are too many diff
between a division erent SBU to handle eff
• Facilitates strategic man ectively.
agement and control of l • Difficulty in assigning re
arge , diverse organizati sponsibility
on
• Addition of another lay
• Fixes accountability at le er after corporate and d
vel of distinct business u ivisional management
nits
Divisional st
ructure
In divisional structure work is divi
ded on the basis of product lines
, type of customers served and g
eographical area covered
Each separate divisions are units
are created and placed under divi
sional level management under
which functional structure may s
till operate
Divisional structure

Advantage Disadvantage
• Enables grouping of fun • Problems in allocation o
ctions f resources
• Generate quick respons • Inconsistency arising fro
es m sharing of authority b
• Enables top manageme etween cooperate and
nt to focus on strategic divisional level
matters
Matrix struct
ure
In large organization they will han
dle more than one project
Each project or product will be str
ategically significant
These kind of structure is created
by assigning functional specialist t
o special project or new product o
r services.
During the duration of projects sp
ecialist from different areas form
group or team reporting to a team
leader
These specialist will be working u
nder their project and their paren
t department simultaneously
Matrix structure

Advantage Disadvantage
• Allows individual special • Dual accountability creat
ist to be assigned , in ac es confusion among em
cordance on their talent ployees
• Foster creativity on dive • Requires a high level of v
rse talent ertical and horizontal co
• Provides good exposure ntribution
to specialist in general • Shared authority may cr
management eate communication pro
blem
Network struc
ture
Also called as Spider web structu
re or virtual organization
Network structure is composed o
f series project groups or collobar
ation linked by constantly changi
ng non hierarchical, cobweb like
network
Structure is highly decentralized
and organized around customer g
roups or geographical region
Applicable for organization facing
continues changes in environmen
t, require quick response
Network structure

Advantage Disadvantage
• High level of flexibility • Loss of control and lack
• Permits concentration o of coordination asthere
n core competencies of are several partners
firm • Risk of overspecializatio
• Adaptability to cope wit n
h the changes in enviro • High cost of duplication
nment of resources could exist