Organization Theory Structure of the Firm: Forms

  1. Organization Forms
    • - Type of specialization
    • - Type of coordination
    • - Mode of control
  2. Classic Organization Forms
    • - Simple Structures: (Mixed specialization criteria; coordination and control by authority and/or lateral communication and peer control; low formalization)
    • - Functional Unitary form: (Specialization by function; Coordination by communication based mechanisms; control on actions or on functional sub-goals)
    • - Divisional form by product/market: (specialization by product/market; coordination without direct communication; control on residual economic results)
    • -Matrixes: (specialization and coordination by by functions and products/outputs in unitary matrixes, or by markets and products in divisional matrixes, double hierarchy and negotiation)
  3. Distinctive Coordination Mechanisms in Functional Unitary Forms
    • - Programs and procedures
    • - Hierarchical intervention
    • - Inter-functional roles and units
  4. Distinctive Coordination Mechanism in Divisional Forms
    • - Transfer prices
    • - Strategic Planning
    • - Inter Divisional units: Central staffs, Critical functions, Pilot divisions, Steering committees
  5. Matrix Forms
    • - First levels units specialized both by input/function and by output/product/business areas
    • -They can be either unitary or divisional
  6. Distinctive Coordination Mechanisms in Matrix Forms
    • - Double hierarchy
    • - Negotiation
    • - Steering Committees
  7. Distinctive Provlems/Costs
    • - Unitary/Functional: Dipartimentalization, sub-goal pursuit
    • - Divisional: Hollow corporations, agency costs, distributive conflicts, function duplication costs
    • - Matrixes: High negotiation and influence cots, schizophrenia
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Organization Theory Structure of the Firm: Forms
Structure of the Firm:Forms