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Selecting An Organizational Design Essay

503 words - 3 pages

Most modern organizations follow one of five organizational structures.These structures are simple, functional, divisional, matrix and network. Acorporation may also use any combination of the five structures to supportshort to long term strategy.According to Wheelen and Hunger, simple structure has nofunctional or product categories and is appropriate for a small company,such as a sole proprietorship. Functional structure is appropriate for amedium-sized firm with several related product lines in one industry.Divisional structure is appropriate for a large corporation with manyproduct lines in ...view middle of the document...

However, in recent years, changeshave been made to this structure in order for manufacturing firms to becompetitive in a global economy.Alfred Chandler concluded that structure follows strategy - changesin corporate strategy lead to changes in organizational structure. Chandlerconducted research using several large U.S. corporations. Changes in theenvironment tend to be reflected in changes to corporate strategy and leadto changes in corporate structure. Experts agree that organizationalstructure will vary within different industries and that there is no optimalorganizational design.After reading Bolman and Deal along with the StrategicManagement text, I have concluded that no one organizational design isany better than any of the rest . A company must use a design thatsupports the growth and profitability of its organization. Research hasshown that companies in similar industries do tend to organize in similarfashions, but not exactly the same. I also agree with Chandler, structuredoes follow strategy. I have seen that first hand with Sears. Corporatewill set forth a new strategic direction for the company, followed bychanges in how the employees are structured. Organizations mustimplement the design changes that are needed to keep the company bothprofitable and competitive.

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