Learning Activity #1
Executives must select among the four types of organization design structures (Simple, Functional, Multidivisional, and Matrix) available to organize operations. Each structure has unique advantages and disadvantages, and the selection of structures involves a series of trade-offs. In this discussion:
a) Please identify and discuss some of the more significant tradeoffs that a company faces with each of these various organization designs. Please be specific. (Please discuss in "list form" rather than a bulk paragraph).
b) Identify a business scenario where a specific structure you select might be a good fit. Also discuss why this scenario is a good fit?
a) Tradeoffs that a company faces with different organization design structures. Simple organization design structures, though allows tight controls by the business owner, the rate of workload is likely to become overwhelming as every approval has to be given by the person at the top. According to Jones (2010) unavailability of the top person can easily result to paralyses of the firm till they come back.
The functional organization design structure is quite advantageous as it allows for effective utilization of talents; as it operates in units that are mandated to carry out specific roles. This results in high productivity. Functional designs can be quite disadvantageous s they seem to discourage teamwork across the firm and may sometimes result in difficult for the management to control (Jones, 2010).
The multidivisional organization design structure is quite effective in small firms but seems not to work well in medium-sized firms. The effectiveness of this organizational structure is hampered by the easiness of duplication of roles, which can be quite costly in an organization (Jones, 2010).
Matrix organizational structure is unique as it brings together managers and employees from different departments within a firm to accomplish a specific organizational goal. The structure not only offers the best platform for exchange of ideas that can lead to effective accomplishment of the firm’s goals but also motivates the staff. By adopting this structure, the organization management has to invest it as bringing all employees together heavily is quite an expensive undertaking (Ashkenas, Ulrich, Jick & Kerr, 2015).
Learning Activity #2
In addition to organization design, there are several other factors that can cause a good strategy to fail: management, operations, marketing, finance, R&D and MIS issues. Review your response to Learning Activity #1 and determine which ONE of these additional factors could cause that specific strategy to fail. Clearly identify the factor, explain why it could cause the strategy to fail – fully support your response.
A firm’s management is a crucial factor that has the capability of leading to the failure of a successful strategy like product differentiation. For a strategy to be successful, the management not only has to bring the required resources together but have to ensure that every step of the strategy is successfully accomplished. Any laxity in part of the management will, therefore, lead a good strategy to fail.