Vodafone as an example of divisional Based Structure

 The product organization utilizes the functional approach but creates large business units

within the company for each major product the company offers. As such, each of

those product division units consists of functional departments required to support that

product. The firm has a product based structure. The firm implemented a 3 product type

organizational structure as shown below.

 There are several benefits, both for employees and businesses, to utilizing a product-based

organizational structure. From a business standpoint, one of the key advantages is that with

a product model, failure in one division doesn’t necessarily affect other company

divisions.The product-based organizational model also enables businesses to operate

with more flexibility, as each business division can follow the unique processes they

need for each product without having to accommodate processes for the other divisions.

From an employee perspective, the product-based organizational structure allows

employees to specialize in their function for a specific industry. This enables employees

to learn new skills and gain expertise in niche areas, which can help them further their

career goals within the company so they can take on leadership roles.
 President

Voice Data Corporate

Services Services Services

Marketing Marketiing Marketing

Finance Finance Finance

HR HR HR

Operations Operations Operations

 Each product based division has its own functional specialists(marketing ,finance,etc) who

provide products different from those of other divisions Allows decentralization to lower

level managers ,Forces on coordination ,Gives chances to CEO for strategic decisions .The

product manager play the role of full time integrator that facilitates the horizontal

communication

 The organization keeps a flat or a horizontal structure due to the horizontal communication

and flattened hierarchy of authority that provides autonomy to employees due to

decentralization ,and enables higher horizontal communication across the organization

,creativity and innovations are emphasized ,little reporting levels exist between the top and

bottom management levels

Mansour automotive as an example of Functional structure

 The organization structure is divided by the functions of the firm including quality,

engineering, manufacturing commercial activities, finance, marketing and Information

technology. This type of structure is the most commonly used organizational structure which

focuses on the following

1. Efficiency and cost reduction using economies of scale as each function share

resources

2. High level of technical experience is maintained by the employees as grouping by

functions gives chances for skills in depth development

3. The functional basis of goals achievement

This organization structure has the following weaknesses

1. Lacks the required flexibility to deal with dynamic environment

2. Lacks the coordination among the departments where the vertical communication is

maximized using rules, procedures, reports ,information systems and the hierarchical

referral ,while horizontal communication is the largest problem of such structure that doesn’t

support teamwork. This problem is mainly solved using the information systems that allows

sharing info within the organizations , the direct contacts between departmental

representatives as well as using task forces that are cross functional to work on solving a

major organizational problem that requires the participation of multi functions in the

organization ,this occurs not on permanent basis

 3. Lacks the perspective of organizational goal and instead supports the functional goals

 The firm keeps a vertical structure with many levels between top and bottom levels

,information flows in a top down flow in a highly centralized organizational structure

,communication is mainly vertical following the tall hierarchy of authority ,creativity and

innovations are not emphasized while the control over costs and operations are the main

objectives .

Al Tarek Automotive as an example of geographic structure

 The organization is divided by the geographical regions it serves as shown in the figure

below ,each geographical location has its own functional activities that ensures satisfying the

needs of the customers of the geographical location

CEO

Cairo Regional Manager Alexandria &Delta

Regional Manager

HR Sales Finance Showroom HR Sales Finance Showroom

Manager Manager Manager Manager Manager Manager Manager Manager
 There are several benefits, both for employees and businesses, to utilizing a product-based

organizational structure. From a business standpoint, one of the key advantages is that with

a regional model, failure in one region doesn’t necessarily affect other company

divisions.

 The location -based organizational model also enables businesses to operate with more

flexibility, as each business division can follow the unique processes they need for each

product without having to accommodate processes for the other divisions. From an

employee perspective, the location -based organizational structure allows employees

to specialize in their function for a specific region . This enables employees to learn

new skills and gain expertise in niche areas, which can help them further their career

goals within the company so they can take on leadership roles.

 Each location based division has its own functional specialists(marketing ,finance,etc) who

provide products different from those of other divisions Allows decentralization to lower

level managers ,Forces on coordination ,Gives chances to CEO for strategic decisions .The

product manager play the role of full time integrator that facilitates the horizontal

communication

 The organization keeps a flat or a horizontal structure due to the horizontal communication

and flattened hierarchy of authority that provides autonomy to employees due to

decentralization ,and enables higher horizontal communication across the organization

,creativity and innovations are emphasized ,little reporting levels exist between the top and

bottom management levels

Siemens Electronic Solutions as an example of Matrix structure

 The matrix organization structure mixes between functional organization structure and

divisional organization structure when there is an emphasis on both innovation supported by

the divisional structure and the technical experience supported by functional structure .A

matrix organization has a complicated structure in which the reporting relationships are set

up as a matrix – a grid – instead of the traditional vertical hierarchy. Employees in a matrix

organization generally report to both a product or project manager as well as a functional

manager (department head). The structure facilitates the horizontal flow of information and

skills.

 Team members are able to share information more readily across task boundaries, which

counters the ‘silo’ limitation of functional management. ‘Silo’ refers to the isolated company

department, where all reporting and sharing of information occurs only within that

department.
  In a matrix structure, reporting and information sharing goes beyond a department’s

boundaries, which allows for specialization that can both increase depth of knowledge and

assign people according to project needs.

The advantages of having a matrix organization are listed as follows:

 Resources are used more efficiently, where equipment and experts are shared across

projects.

 Projects and products are formally coordinated across functional departments.

 Information flows in several different directions within the whole organization,

 The company’s employees are in touch with many people inside and outside their

department. This helps with sharing information, which in turn speeds up many

processes, including decision-making.

 Employees must work autonomously and organize themselves creatively, according to

each boss they have to report to. This may boost motivation and decision-making.

 Individuals have the opportunity to use particular skills within a variety of contexts.

 Several departments have less need to meet regularly. This saves money and can improve

coordination.

 Projects are usually more cost-effective if human and material resources are shared across

departments.

Disadvantages of a matrix organization

 Project team members may have divided loyalties because they have to report to two or

more line mangers. This kind of scenario – reporting to two or more different bosses –

can put team members under considerable pressure. Given the complex nature of matrix
 structures, the line of accountability for project teams may not be very clear. It can be

hard to coordinate properly. Unless it is well set up and executed, there is a risk of chaos.

 This organization structure enables a horizontal or a flat organization as the firm horizontal

communication is increased with high level of autonomy and empowerment given to project

managers over their responsibilities ,the span is wide and the firm is highly flexible

supporting innovation ,coordination and creativity

Mechanistic Vs Organic Organizations

Given the previous example of organizations we can state that

1. Siemens electronics solutions is an organic organization due to multiple reasons

 Decentralized work place

 Space is given for innovation

 Informal and flexible culture

 High degree of horizontal communication between different functions

 Few rules and regulations

 Learning organization

2. Mansour automotive as mechanistic organization due to multiple reasons

 Centralized workplace as decision making are centralized at the top management

 Less space is given for creativity and innovation

 Rigid and formal culture

 High degree of written vertical top bottom communication

 Many rules and regulations to follow

 Efficiency organization looking to push down costs