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Structures Understanding Business Higher Business Management

Structures Understanding Business Higher Business Management. Ways to Structure. Functional Structure. Functional Structure. Functional Structure. Functional Structure. Advantages Specialisation – each department focuses on its own work

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Structures Understanding Business Higher Business Management

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  1. Structures Understanding Business Higher Business Management 1

  2. Ways to Structure

  3. Functional Structure Functional Structure 3

  4. Functional Structure Functional Structure Advantages • Specialisation – each department focuses on its own work • Accountability – someone is responsible for the section • Clarity – know your and others’ roles Disadvantages • Closed communication could lead to lack of focus • Departments can become resistant to change • Coordination may take too long • Gap between top and bottom

  5. Product/Service Structure

  6. Organisation by Product/Activity Product/Service Structure Advantages • Expertise can develop in dealing with each product/service • Managers can easily identify how each product is performing • Decisions can be more responsive to changes in the business environment Disadvantages • Duplication of functions (e.g. different sales force for each division) • Divisions may find themselves competing with each other • Lack of central control over each separate division

  7. Place Structure Organisation by Place

  8. Organisation by Place Place Structure Advantages • Serve local needs better • More effective communication between firm and local customers • Better knowledge of local staff Disadvantages • Conflict between local and central management • Duplication of resources and functions

  9. Organisation Charts Organisation Structures Hierarchical Structure

  10. Organisation Charts Organisation Structures Matrix Structure Marketing Sales R&D Project HR Production Finance 10

  11. Organisation Structures Organisation Charts Entrepreneurial 11

  12. Organisation Structures • Centralised • Important decisions are made at the head office • Very little delegation • Easier to promote a corporate image • Decentralised • Important decisions made by managers • Employees are motivated and empowered

  13. Some Key Terms Structure Key Terms

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