Mib organisation structure
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Mib organisation structure

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    Mib organisation structure Mib organisation structure Presentation Transcript

    • Organizational StructuresOrganizational Structures
    • Learning ObjectivesLearning Objectives  factors that impact how globalfactors that impact how global organizations are structured andorganizations are structured and managedmanaged  Types of organizational structuresTypes of organizational structures  Controlling the global organizationControlling the global organization
    • Factors that impact structure andFactors that impact structure and decision makingdecision making  Degree of involvement in internationalDegree of involvement in international operations.operations.  Products that the firm markets.Products that the firm markets.  Size and importance of the firm’s markets.Size and importance of the firm’s markets.  Human resource capability of the firm.Human resource capability of the firm.  Corporate goals, Strategies and objectives.Corporate goals, Strategies and objectives.
    • Organizational StructureOrganizational Structure  Companies must change strategies as theirCompanies must change strategies as their structures evolve from domestic to multinational.structures evolve from domestic to multinational.  The organizational structure, control systems,The organizational structure, control systems, culture, and human resource managementculture, and human resource management systems that together determine howsystems that together determine how efficiently and effectively organizational resourcesefficiently and effectively organizational resources are used.are used. • All organizations require some form ofAll organizations require some form of organizational structure to implement andorganizational structure to implement and manage their strategiesmanage their strategies • Firms frequently alter their structure as theyFirms frequently alter their structure as they grow in size and complexitygrow in size and complexity
    • Designing Organizational StructureDesigning Organizational Structure  OrganizingOrganizing  The process by which managers establish workingThe process by which managers establish working relationships among employees to achieve goals.relationships among employees to achieve goals.  Organizational StructureOrganizational Structure  Formal system of task and reporting relationshipsFormal system of task and reporting relationships showing how workers use resources.showing how workers use resources.  Organizational designOrganizational design  The process by which managers create a specific type ofThe process by which managers create a specific type of organizational structure and culture so that a companyorganizational structure and culture so that a company can operate in the most efficient and effective waycan operate in the most efficient and effective way
    • Tall and Flat OrganizationsTall and Flat Organizations  Tall structures have many levels of authorityTall structures have many levels of authority  As hierarchy levels increase, communication getsAs hierarchy levels increase, communication gets difficult creating delays in the time being taken todifficult creating delays in the time being taken to implement decisions.implement decisions.  Communications can also become distorted as it isCommunications can also become distorted as it is repeated through the firm.repeated through the firm.  Can become expensiveCan become expensive  Flat structures have fewer levels and wide spans of control.Flat structures have fewer levels and wide spans of control.  Structure results in quick communications but can leadStructure results in quick communications but can lead to overworked managers.to overworked managers.
    • Tall and Flat OrganizationsTall and Flat Organizations
    • Product Structure Most often used by multinational corporations. Improved cost efficiency is a major benefit. Geographic Structure Second most used approach. Follows the marketing concept most closely. Functional Structure The simplest from the administrative viewpoint. A variation is one that uses processes as a basis for structure. Market Structure Especially used if customer groups are dramatically different. Matrix Structure Integrates the various approaches. Most companies find this arrangement problematic. Complexity of this structure may increase the reaction time of a company. Types of Organizational StructuresTypes of Organizational Structures
    • Product StructureProduct Structure  Allows functional managers to specialize in one productAllows functional managers to specialize in one product areaarea  Removes need for direct supervision of division byRemoves need for direct supervision of division by corporate managerscorporate managers  Divisional managers have the responsibility for devisingDivisional managers have the responsibility for devising an appropriate business-level strategy to allow thean appropriate business-level strategy to allow the division to compete effectively in its industrydivision to compete effectively in its industry  Each product group is responsible for marketing, sales,Each product group is responsible for marketing, sales, planning, and (in some cases) production and researchplanning, and (in some cases) production and research and developmentand development
    • Product organizational structureProduct organizational structure • Advantageous when product line constantly changesAdvantageous when product line constantly changes with technological advanceswith technological advances • Facilitates the development of global products andFacilitates the development of global products and global roll-outsglobal roll-outs • Appropriate when perceived differences involved withAppropriate when perceived differences involved with marketing the various product lines are greater thanmarketing the various product lines are greater than perceived differences in geographic marketsperceived differences in geographic markets • Knowledge of specific geographic areas can be limitedKnowledge of specific geographic areas can be limited and sensitivity to local market conditions can beand sensitivity to local market conditions can be diminisheddiminished
    • Geographic organizational structuresGeographic organizational structures  Focus on regions of worldFocus on regions of world  Allows company to locate marketing and manufacturingAllows company to locate marketing and manufacturing efforts in such a way as to take advantage of regionalefforts in such a way as to take advantage of regional benefitsbenefits  Puts company in closer contact with distributors,Puts company in closer contact with distributors, customers, and subsidiariescustomers, and subsidiaries  Managers locate different divisions in each of the worldManagers locate different divisions in each of the world regions where the organization operates.regions where the organization operates.
    • Geographic organizational structuresGeographic organizational structures • Separate unit for each GeographySeparate unit for each Geography  Extremely sensitive to local customs, laws, and needsExtremely sensitive to local customs, laws, and needs  Expensive!!!Expensive!!!  Many companies are phasing out country-basedMany companies are phasing out country-based structures and are moving toward regional centersstructures and are moving toward regional centers • Appropriate when company needs intimate knowledge ofAppropriate when company needs intimate knowledge of its customers and their environmentsits customers and their environments • Gives company opportunity to understand the localGives company opportunity to understand the local culture, economy, politics, laws, and competitiveculture, economy, politics, laws, and competitive situationsituation
    • Functional organizational structuresFunctional organizational structures • Top executives in marketing, finance,Top executives in marketing, finance, production, accounting, and research andproduction, accounting, and research and development all have worldwidedevelopment all have worldwide responsibilitiesresponsibilities • Best for narrow or homogeneous productBest for narrow or homogeneous product lines with little variation between productslines with little variation between products or geographic marketsor geographic markets
    • Market StructureMarket Structure • Groups divisions according to the particular kinds ofGroups divisions according to the particular kinds of customers they servecustomers they serve • Allows managers to be responsive to the needs of theirAllows managers to be responsive to the needs of their customers and act flexibly in making decisions incustomers and act flexibly in making decisions in response to customers’ changing needsresponse to customers’ changing needs
    • Matrix StructureMatrix Structure • An organizational structure that simultaneously groupsAn organizational structure that simultaneously groups people and resources by function and product.people and resources by function and product.  Results in a complex network of superior-subordinateResults in a complex network of superior-subordinate reporting relationships.reporting relationships.  The structure is very flexible and can respond rapidlyThe structure is very flexible and can respond rapidly to the need for change.to the need for change.  Each employee has two bosses (functional managerEach employee has two bosses (functional manager and product manager) and possibly cannot satisfyand product manager) and possibly cannot satisfy both.both. • Developed to overcome drawbacks of geographic,Developed to overcome drawbacks of geographic, functional, and product organization structuresfunctional, and product organization structures • Allows for two or more dimensions of theoretical weight,Allows for two or more dimensions of theoretical weight, e.g., importance to product and geographye.g., importance to product and geography • Complexity can cause duplication of authority, confusionComplexity can cause duplication of authority, confusion of responsibility and power struggleof responsibility and power struggle
    • Matrix StructureMatrix Structure
    • Controlling the Global OrganizationControlling the Global Organization 1.1.Developing standardsDeveloping standards  Behavioral standardsBehavioral standards  Performance standardsPerformance standards 1.1.Measuring and evaluating performanceMeasuring and evaluating performance 2.2.Analyzing and correcting deviations fromAnalyzing and correcting deviations from the standardsthe standards 4. Effective communication systems4. Effective communication systems facilitate controlfacilitate control
    • Post-ClassPost-Class ActivityActivity  Why organizational issues for born-globalWhy organizational issues for born-global firms differ from those for traditionalfirms differ from those for traditional multinational companies.multinational companies.  Give examples of how technology can beGive examples of how technology can be utilized to support internal globalutilized to support internal global communications systems.communications systems.  Discuss the conflicts that can ariseDiscuss the conflicts that can arise between international headquarters andbetween international headquarters and national subsidiaries.national subsidiaries.  Global account management.Global account management.  Transnational network structure.Transnational network structure.