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Chapter Ten

Chapter Ten. Implementing Strategy: Creating Effective Organizational Designs. Learning Objectives. TRANSPARENCY-84. After studying this chapter, you should have a good understanding of:.

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Chapter Ten

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  1. Chapter Ten Implementing Strategy:Creating Effective Organizational Designs

  2. Learning Objectives TRANSPARENCY-84 After studying this chapter, you should have a good understanding of: • The importance of organizational structure and the concept of the “boundary-less” organization in implementing strategies • The growth patterns of major corporations and the relationship between a firm’s strategy and its structure • Each of the traditional types of organizational structure—simple, functional, divisional, and matrix • The relative advantages and disadvantages of traditional organizational structures • The implications of a firm’s international operations for organizational structure • The different types of boundary-less organizations—barrier-free, modular, and virtual—and their relative advantages and disadvantages

  3. Growth Patterns of Large Corporations TRANSPARENCY-85 Exhibit 10.1 Phase 1 Strategy: Low revenue base; simple product-market scope Structure: Simple Phase 2 Strategy: Increase in revenues; engage in vertical integration (backward and/or forward) Structure: Functional Phase 3 Strategy: Expand into new, related product-markets and/or geographical areas Structure: Divisional Phase 4 Strategy: Expand into international markets Structure: International Division, Geographic Area, Worldwide Product Division, Worldwide Functional, or Worldwide Matrix

  4. Chief Executive Officer or President Manager Production Manager Engineering Manager Marketing Manager R&D Manager Personnel Manager Accounting Lower-level managers, specialists, and operating personnel TRANSPARENCY-86 Functional Structure: Advantages and Disadvantages Exhibit 10.2

  5. Chief Executive Officer or President Corporate Staff Division A General Manager Division B General Manager Division C General Manager Manager Production Manager Engineering Manager Marketing Manager R&D Manager Personnel Manager Accounting Lower-level managers, specialists, and operating personnel Organized similarly to Division 1 Organized similarly to Division 1 TRANSPARENCY-87 Divisional Structure: Advantages and Disadvantages Exhibit 10.3

  6. Chief Executive Officer or President Corporate Staff Manager Administration and Human Resources Manager Projects Manager Manufacturing Manager Engineering Manager Marketing Manager Public Relations Project A Project B Project C Project D TRANSPARENCY-88 Matrix Structures: Advantages and Disadvantages Exhibit 10.4

  7. TRANSPARENCY-89 Functional, Divisional, and Matrix Structures: Advantages and Disadvantages Exhibit 10.5 Functional Structure Divisional Structure Matrix Structure

  8. TRANSPARENCY-90 Pros and Cons of the Barrier-Free Structures Exhibit 10.6

  9. TRANSPARENCY-91 Pros and Cons Of Modular Structures Exhibit 10.7

  10. TRANSPARENCY-92 Pros and Cons of Virtual Structure Exhibit 10.8

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