4 - 1 Team Theory duct Team Structure —a divisional tructure in which specialists from the upport functions are combined into roduct development teams. ically used by an organization whose roducts are very technologically comple r whose characteristics change rapidly o suit customer needs.
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4 - 1
Team Theory
Product Team Structure—a divisional structure in which specialists from the support functions are combined into product development teams.
Typically used by an organization whose products are very technologically complexor whose characteristics change rapidlyto suit customer needs.
4 - 2
Product Team Structure.
ProductDivision
Product Division
CEO
Functions
Product Development Teams
Product Division
Vice PresidentResearch and Development
Vice PresidentSales and Marketing
Vice President Manufacturing
Vice PresidentFinance
Functional specialist
Vice PresidentMaterials Management
PTMProduct Team Manager
PTM PTM PTM
4-29
4 - 3
Team Structures
•Reduces barriers among departments•Increases collaboration•Shorter response times and quicker decision making•Increases morale and motivation as employees are involved in the decision making•Conflict•Time consuming as lots of compromise neededAnd much time spent in meetings.
4 - 4
Matrix StructureCEO
Vice PresidentEngineering
Vice PresidentFinance
Vice PresidentPurchasing
Vice PresidentSales and Marketing
Vice President Research and Development
Product AManager
Product BManager
Product CManager
Product DManager
Product Team
Two-boss employee
Greater flexibility Interdepartment
co-operation Expertise is
available to all divisions
Improves information sharing
Frustration and confusion as employees have two bosses – dual chain of command
Time consumed in numerous meetings
Implementation is often slow
4 - 6
Network Structure
A network structure is a cluster of different organizations whose actions are coordinated by contracts and agreementsrather than through a formal hierarchy.
4 - 7
Organizational Theory
Network structures often result from outsourcing.
Outsourcing is the process of moving activities that were previously performed inside the organization to the outside (where they are done by other companies).
In this structure the firm is in the centre – a hub surrounded by a network of specialists
These specialists perform various services for the firm i.e. the firm outsources these services.
Services that are outsourced often include accounting, human resources and manufacturing.
Allows the firm to contract expertise anywhere that they may not have in-house
Reduced overhead costs for firm – less health care cost, utility cost, etc
Flexible and responsive
Lack of control as the firm cannot control the firms providing services
Co-ordination issues
Employee loyalty is weakened
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