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Chapter 9.docx

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Administrative Studies
ADMS 4570
Lois King

Chapter 9 Executing strategy is normally the biggest challenge facing managersit requires commitment perseverance and a solid capacity to lead motivate direct and inspire an entire organization to deliverSo it is important to decide on the organizational structure which will help organize activities and need to devise ways to coordinate and integrate those activities to assess what mechanisms processes and techniques are most helpful in enhancing the permeability of the internal and external boundaries of the firm A firms strategy and structure change as it increases in size diversifies into new product markets and expands its geographic scope Simple structure increases its sales revenue and volume of outputs over timemay also engage in some vertical integration to secure sources of supply backward integration as well as channels of distribution forward integration After a time the firm will implement a functional structure to concentrate efforts on both increasing efficiency and enhancing its operations and products can group by functions departments or geographic area Then will want to develop products and go into other markets so will need a divisional structure organized by product lines or geographic markets Finally a firm will want to go globalso can choose from international division geographic area worldwide product division worldwide functional and worldwide matrix oNeed to look at the extent of international expansion the type of strategy global multidomestic or transnational and the degree of product diversityIf want to diversify into many product lines might consider divisional structureIf want to just acquire other businesses instead of developing those competencies internally might have a holding company structureprobably do this if a new company Simple structureHighly informal coordination of tasks is by direct supervision Decision making is highly centralized few rules and regulation and reward systems are informalstill room for creativity and individualism from employees but might be confused of responsibilities because lack of regulationsOften a manager is hired to over see day to day operations even though the owner is highly involved Little room for upward mobility so recruiting and retaining is difficultFunctional structureIf 15 employees or less not necessary to have a variety of formal arrangements and groupings of activitiesWill have a specialist manager in all major functional areas Good for single product or closely related ones high production volume and some vertical integration High level of centralization so as to ensure control high level of coordination and control decision making is centralized career paths are available within the specialized areasAdvantages
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