Business Is Organized Primarily for Efficiency Purposes, Essay

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business is organized primarily for efficiency purposes, evaluate the relationship between organizational structure and organizational effectiveness from the attached readings.

The organizational structure will provide a business with the ability to maximize their productivity and profit margins. This is achieved using a variety of models during the process the most notable include: the functional, divisional and matrix. The functional structure is when there is a head corporate office which is running the sales, marketing, IT, finance and operations. This is designed to streamline the decision making process and create an environment that will help the organization to maximize its productivity and profit margins. (Stanford 2007) (Fritz 1996)

The divisional approach is concentrating on reducing decision making. This is taking place by having the CEO serve a central role and each segment perform different functions. The way that this is achieved is through minimizing outsourcing and adapting to challenges in the operating environment. In many cases, this model can be adjusted to account for other operations around the world and to seize upon new opportunities.

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(Stanford 2007) (Fritz 1996)

The matrix approach is similar to the divisional strategy. The differences are these entities are reporting to the main divisions of the firm. They will answer directly to the department heads. These individual will report to the CEO of the organization. In these situations, this model is used to for entities which require highly specialized skills. At the same time, there is an emphasis on controlling the cost structure for producing or delivering the end merchandise to customers. (Stanford 2007) (Fritz 1996)

These different models are utilized to increase efficiency by: streamlining decision making and ensuring firms can adapt with unique challenges they are facing. This gives them the ability to compete on a global scale and adjust to changes in their operating environment. When this happens, these entities can quickly evolve and transform. It is at this point where they will become more competitive….....

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