Strategic management (organisational structure) Essay

Strategic management (organisational structure) - Essay Example These include the entrepreneurial simple structure, the functional specialization structure, the divisional structure, and the conglomerate structure. The entrepreneurial structure is tagged by Mintzberg as being the 'simple structure.' According to Eltern, Schwestern, and Steffen, "The simple structure is characterized, above all by what it is not - elaborated. Typically, it has little or no technostructure, few support staffers, a loose division of labor, minimal differentiation among its units, and a small managerial hierarchy. Little of its behavior is formalized, and makes minimal use of planning, training and the liaison devices. It is above all, organic. In a sense, simple structure is nonstructure" (2005, p. 1). Functional organizations are effective in minimizing activities that are repetitive in nature. They also encourage the recruitment and development of technical expertise throughout the organization. However, they are hard to organize and coordinate and result in the development of perspectives that are considered to be too narrow in nature (Tripp, Siwapiragam, Rahim, Horton 2005). Divisional organizations also have their own distinctive advantages and disadvantages. These types of organizations are able to make better decisions because of the very way they are set up. Those who work for or represent the company are held accountable for their actions and their performance. This type of organization, as opposed to functional organizations, is significantly easier to coordinate functions within. Drawbacks to the divisional organization include the fact that it is difficult to gain and allocate support from corporate staff, some economies of scale is lost, and divisions have a tendency to compete with one another which can be detrimental to the organization (Tripp, Siwapiragam, Rahim, Horton 2005). Conglomerate structures represent a combination of the aforementioned organizational structures. These are also known as matrix structures. Advantages to this type of organization include that technical expertise is encouraged, reinforced, and broadened; resources are utilized in an efficient manner; and that objectives that may be causing conflict within the organization are balanced. Disadvantages to this type of organization include an increase in power conflicts, confusion, and stress for those employees who have more than one supervisor, and that it can hinder the decision-making process that takes place within the organization (Tripp, Siwapiragam, Rahim, Horton 2005). Reebok and Starbucks and Their Appreciated Structures According to Reebok, "During this past quarter, we decided to consolidate our Reebok Brand product and marketing groups under one leader. We believe that the new organizational structure will give us greater focus on product and marketing concepts for our targeted consumer groups. The new product teams are fully integrated from design and development through to marketing, and support our product initiatives under the Rbk, Performance, Lifestyle and Children's platforms. These teams will now design and develop product and marketing concepts for a focused consumer segment, rather than by product category as we had in the past" (Reebok 2005). They believe that their new structure is more focused and responsible, and that it can better meet the demands of consumers who come from a variety of different