superior boss senior director manager subordinate assistant junior staff employee worker

Company structure Unit 3 Handout: Board of Directors

Phrases to describe line of command. Make pairs: To be in charge of To support To be supported by To be accountable to To be responsible for To be responsible to To assist To be assisted by To report to

Phrases to describe line of command. To be in charge of sg To support sy To be supported by sy To be accountable to sy To report to sy To be responsible for sg To assist sy To be assisted by sy To be responsible to sy

Use the previous phrases to fill in the gaps: The Area Sales Manager ____ the Head of Sales. The Marketing Manager is _____ the Managing Director. Human Resources are ____ employing staff. Our team of sales reps is ____ the Sales and Marketing Department. Interns may also be called to ___ the head of the Budget Section in monitoring the status of projects.

The Area Sales Manager reports to/ is responsible to/ is accountable to the Head of Sales. The Marketing Manager reports to/ is responsible to/ is accountable to the Managing Director. Human Resources are responsible for/ are in charge of employing staff. Our team of sales reps is responsible for/ in charge of the Sales and Marketing Department. Interns may also be called to assist /support the head of the Budget Section in monitoring the status of projects.

Hierarchical/pyramidal structure

Hierarchical Definition: One person or a group of people at the top and an increasing number of people below them at each successive level Advantages: Clear chain of command All know their place, the kind of decisions they can make Disadvantages: Activities can be too complicated for a single hierarchy no responsibility on lower levels (not motivating) No unplanned collaboration

Functional structure

Functional structure Departments are usually part of a hierarchy

Functional Definition: Business organized according to function or role. (e.g., finance, marketing, HR) Advantages: Easier management than large hierarchical structure Efficiency (experts grouped together) Disadvantages: concern for success of dept. only (not co.) Slower decision making Conflicts between departments

Decentralized structure: “Large organizations making a range of products are often further divided into separate operating division.” (MK, p. 22)

Decentralized structure Definition: Separate operating divisions organization along product lines, territory or clients, e.g, Philips Lighting, Philips Healthcare, Philips Domestic Appliances and Personal Care

Matrix structure

Matrix structure explained The matrix structure overlays two organisational forms: the FUNCTIONAL and the PROJECT ORIENTED structure. In a matrix structure, there are two official reporting lines: one to the manager of the specialist function and the other to the project manager. For example, all engineers may be in one engineering department and report to an engineering manager, but these same engineers may be assigned to different projects and report to a project manager while working on that project. Therefore, each engineer may have to work under several managers to get their job done.

Matrix structure (pl. matrices) Definition: People report to more than one superior Advantages: Motivational: Authority and autonomy at lower levels too. Experts from different fields collaborate Disadvantages: matrices involving several departments are too complex conflicting loyalties

Team/ Project oriented Definition: temporary groups responsible for 1 project  split up Advantages: Autonomy motivation Disadvantages: Decision making can be difficult relational problems only small and self-disciplined teams with a strong leader function well

Flat or horizontal organizations How else can you say: “reduce the chain of command”? Take out layers of management, flatten the company structure Why are companies flattening their hierarchies? Motivation: managers delegate responsibilities and decision making to staff To encourage collaboration within the company Cutbacks: companies economize in recessions Reduced need for administrative staff due to advanced IT systems

Rephrase these sentences. Use the prompts. Employees feel more concern for their own department than for the whole of the company.  Employees are... Employees are more concerned with their own department ... The company was forced to make some cutbacks (n.) in the current recession. Noun  verb The company was forced to cut back (v.) in the current recession. The company downsized the workforce by eliminating some layers of middle management. Say it in 3 words! The company flattened its hierachy.

Pixar: the lounge and unplanned collaborations The atrium houses a reception, employee mailboxes, cafe, foosball, fitness center, two 40-seat viewing rooms, and a large theater – and was planned by Jobs to house the campus’ only restrooms. The idea was that people who naturally isolate themselves would be forced to have great conversations, even if that took place while washing their hands. Today, they do have more than one restroom, of course. But it was the idea behind it that was important. Source: http://officesnapshots.com/2012/07/16/pixar-headquarters-and-the-legacy-of-steve-jobs/

Apple’s new headquarters (plan) According to Peter Oppenheimer, Apple’s chief financial officer, the circle form is all about workflow. “We found that rectangles or squares or long buildings or buildings with more than four stories would inhibit collaboration,” he told the San Jose Mercury. “We wanted this to be a walkable building, and that’s why we eventually settled on a circle.” (Source: Oliver Wainwright , theguardian.com, Friday 15 November 2013 11.44 GMT http://www.theguardian.com/artanddesign/2013/nov/15/norman-foster-apple-hq-mothership-spaceship-architecture )

Future trends: Reading: MK, p. 21 Define ‘wikinomics’. Define outsourcing. What is the connection between the two?

Listening: Corporate structure http://www.youtube.com/watch?v=3AIZglt38NA Answer these questions: Who runs publicly traded companies? Who are the members of the management team? Who does the management team report to? How is the Board of Directors set up? What are the two main tasks of the B of D? Helps direct the company’s _________. Protects the _________ investment. Adapted from: Investopedia (http://www.investopedia.com/articles/basics/03/022803.asp#ixzz2CfUz0kUr)

Match up the position with the responsibilities that go with it: Chief Operations Officer: Responsible for the corporation's operations, looks after issues related to marketing, sales, production and personnel. Leader of the corporation, runs the Board and maintains communication with the CEO and high-level executives Chief Executive Officer: responsible for the entire operation of the corporation and reports directly to the chairman and board of directors. (Other name: Managing Director) Chief Finance Officer: Also reporting directly to the CEO, he is responsible for analyzing and reviewing financial data, reporting financial performance, preparing budgets and monitoring expenditures and costs. Chairman of the Board CEO COO CFO Adapted from: Investopedia (http://www.investopedia.com/articles/basics/03/022803.asp#ixzz2CfUz0kUr)

Corporate structure of publicly traded companies Fill in the blanks:

Corporate structure of publicly traded companies

HAND-IN HOMEWORK ASSIGNMENT Describe Testech company’s structure shown on the next slide. Use RB/ p. 64 for help. DUE: NEXT LECTURE (02 December)

Testech’s company structure