Behemoth Corporation Case Study

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Behemoth Corporation

Is a matrix a good choice for Behemoth? Advise Rawling on the possible advantages and disadvantages of adopting this organizational structure.

The global environment for business is evolving rapidly in a dynamic and mostly unpredictable manner. It is difficult to predict many of the global trends because of the level of complexity that is involved in business. In this environment, there is one set of pressures that pushes organizations towards standardization of processes. If an organization can standardize its business processes then it can maintain a largely centralized control structure, create quantities of scale, and reduce transaction costs. However, standardization fails in many applications. There are also different pressures that arise from regional preferences and cultural differences that often make standardization incredibly difficult.

There are two basic approaches to management in international organizations as well as different combinations of these approaches as well. Some organizations will operate international operations independently of the parent organization and the subsidiary may operate with a completely different operating structure. This is a fairly common practice because labor conditions and consumer preferences are often vastly different in foreign regions of the globe However, maintaining two sets of operating practices between the parent and the subsidiary does not effectively exploit quantities of scale. Whenever companies can use the same systems to manage their business operations they can often reduce things such as transaction costs and improve certain efficiencies. For example, ERP software have been successfully used to redesign international operations and gain more efficiency; especially in regards to transaction costs.

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Behemoth considers some of its core competencies to be high quality technology, large but nimble production capabilities, and a large degree of decentralization that allows the company to be more innovative in design. The CEO, Rawling Dough, believes that a matrix structure would be the most ideal organizational structure to maintain these competencies in the international market. The matrix structure offers many advantages by allowing the organization to group people and resources both by function and by product. The hierarchical structure in these organizations is relatively flat which can make it more responsive to its customers and changing market conditions.

The matrix can be customized to be based off whatever products and functional divisions that the organization deems most relevant. Members of such an organizational structure are often called "two-boss employees" because they have to report to not only their functional manager but their product team manager as well (Kubasek, Brennan, & Browne, 2015, p. 426). Despite technically having two bosses to report to, the team framework is the basic organizational framework for this design. Teams coordinate much of the daily activities themselves which would also allow the organization to stay nimble and flexible. Since the structure is largely flat, this will improve the lines of communication by streamlining much of the hierarchy that would normally be found in such an international organization.

2) Assuming that Rawling decides to go ahead with a matrixed organization, describe to him, at a high level, what such an organization might look like in terms of business units and.....

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