Ch. 9: Ice and Glaciers, Wind and Desert
1) Discuss ways in which glaciers might be manipulated for use as a source of water?
2) Briefly describe the formation and annual cycle of an alpine glacier.
3) Define/describe moraine and explain how moraines can be used to reconstruct past glacial extent and movements?
5) Describe two ways in which glaciers store water, and explain how the retreat of alpine glaciers can cause both springtime flooding and summer drought.
6) Explain how sunlight falling on Earth’s surface affects wind circulation.
Ch. 11: Groundwater and Water Resources
1) Explain the importance of porosity and permeability to groundwater availability for use.
5) Explain how sinkholes develop and name the type of landscape in which sinkholes are common.
7) Explain three characteristics used to describe water quality.
9) Describe two possible consequences of groundwater withdrawal exceeding recharge.
10) Explain the process of saltwater intrusion.
9.1 Why and How Managers Control
LEARNING OBJECTIVE 9.1
Identify the types of controls used by managers and the reasons for them.
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• Importance of controlling
• Types of controls
• Internal and external control
Control is important for organization success, and we practice a lot of control quite naturally. Think of the things you do for fun-playing golf or tennis or Frisbee, reading, dancing, driving a car, or riding a bike. Through activities like these you’ve already become an expert in the control
process. How? Most probably by having an objective in mind, always checking to see how well you are doing, and making continuous adjustments to get it right.
Importance of Controlling
The management function of planning involves setting goals and making plans. It is closely linked with controlling, the process of measuring performance and making sure that plans turn out as intended. Information is the foundation of control and facts are friendly. An experienced CEO
once said: “Facts that reinforce what you are doing are nice, because they help in terms of psychic reward. Facts that raise alarms are equally friendly, because they give you clues about how to respond, how to change, where to spend the resources.”3
Controlling is the process of measuring performance and taking action to ensure desired results.
Figure 9.1 shows how controlling fits in with the other management functions. Planning sets the direction and the parameters for resource allocation. Organizing brings people and material resources together in working combinations. Leading inspires people to best utilize these resources.
Controlling makes sure that the right things happen, in the right way, and at the right time. It’s a way to ensure that performance is consistent with plans and that the accomplishments of a team or organization are coordinated.
Planning—to
set the direction
• Decide where you
want to go
• Decide how to best
go about it
Organizing—to create
structures
Leading- to inspire
effort
Controlling-
to ensure results
• Measure performance
• Take corrective action
FIGURE 9.1 The role of controlling in the management process.
One of the great benefits of effective control is learning. Consider, for example, the program of after-action review pioneered by the U.S. Army and now used in numerous organizations. It is a process for a structured review of lessons learned and results in a completed project, task force
assignment, or special operation. Participants answer questions like: “What was the intent?” “What actually happened?” “What did we learn?”4 The after-action review helps make continuous improvement a shared norm. It encourages participants to take responsibility for their actions, what
they achieved, and how they can be more effective in the future. The end-of-chapter team exercise is modeled on this approach.
An after-action review is a systematic assessment of lessons learned and results accomplished in a completed project.
Types of Controls
The open-systems perspective shown in Figure 9.2 is one of the best ways to understand control. It shows how feedforward, concurrent, and feedback controls are linked with different phases of the input-throughput-output cycle. The use of these control types increases the likelihood of
high performance.
Feedforward Controls
Feedforward controls, also called preliminary controls, take place before a work activity begins. They ensure that objectives are clear, that directions are established, and that the right resources are available to accomplish the objectives. The goal is to solve problems before they occur by
asking an important but often neglected question: “What needs to be done before we begin?”
Feedforward control ensures that directions and resources are right before the work begins.
Feedforward controls are preventive. Managers using them take a forward-thinking and proactive approach. At McDonald’s, for example, preliminary control of food ingredients plays an important role in the firm’s quality program. The company requires that suppliers of its hamburger buns
produce them to exact specifications, covering everything from texture to uniformity of color. Even in overseas markets, the firm works hard to develop local suppliers that can offer dependable quality.6
Concurrent Controls
Concurrent controls focus on what happens during the work process. Sometimes called steering controls, they make sure that plans are being followed and the right things are being done in the workflow. You can also think of this as control through direct supervision. In today’s
increasingly complex virtual world, that supervision can be computer driven and virtual as well as face-to-face.
Concurrent control focuses on what happens during the work process.
The goal of concurrent controls is to solve problems as they happen. The key question is, “What can we do to improve things right now?” Picture this scene at the Hyundai Motors headquarters in Seoul, South Korea, in what the firm calls its Global Command and Control Center.?
Work Inputs
Work Throughputs
Work Outputs
Feedforward Controls
Concurrent Controls
Feedback Controls
Ensure the right directions are
set and the right resource
inputs are available
Ensure the right things
are being done as part
of workflow operations
Ensure that final results are
up to desired standards
Solve problems
before they occur
Solve problems while
they are occurring
Solve problems
after they occur
FIGURE 9.2 Feedforward, concurrent, and feedback controls.
With dozens of computer screens relaying video and data, it (the Global Command and Control Center] monitors Hyundai operations around the world. Parts shipments are traced from the time they leave the supplier until they reach a plant. Cameras cover assembly lines from Beijing to
Montgomery and keep a close watch on Hyundai’s giant Ulsan, Korea, plant, the world’s largest integrated auto factory.
In the Hyundai example, computers monitor operations and gather business intelligence in real time. Using sophisticated information systems, managers are able to spot and immediately correct problems in the manufacturing cycle. The same kind of process intervention also happens at
McDonald’s, but there, the concurrent control is face to face. Ever-present shift leaders constantly observe the unit as a whole, while helping with the work necessary to keep the unit running. They are trained to intervene as needed to correct things on the spot.
Feedback Controls
Feedback controls, also called post-action controls, take place after work is done. They focus on the quality of end results rather than on inputs and activities. Feedback controls are largely reactive; the goals are to solve problems after they occur and prevent future problems. They ask the
question: “Now that we are finished, how well did we do?”
Feedback control takes place after an action is completed.
We are all familiar with feedback controls and probably recognize their weak points from a customer service perspective. Restaurants often ask how you liked a meal after it is eaten; course evaluations tell instructors how well they performed after the course is over; a budget summary
identifies cost overruns after a project is completed. Feedback about mistakes may not enable their immediate correction, but can help to improve performance in the future.
Internal and External Control
Managers have two broad options with respect to control systems. First, they can trust and expect people to control their own behavior. This puts priority on internal or self-control. Second, they can exercise external control by structuring situations to increase the likelihood that things will
happen as planned. The alternatives here include bureaucratic or administrative control, clan or normative control, and market or regulatory control. The most effective control typically involves a mix of these options.
Self-Control
We all exercise internal control in our daily lives. We manage our money, our relationships, our eating and drinking, our health behaviors, our study habits, and more. Managers can take advantage of this capacity for self-control by unlocking, allowing, and supporting it. This means helping
people to be good at self-management, giving them freedom, and encouraging them to exercise self-discipline in performing their jobs. Any workplace that emphasizes participation, empowerment, and involvement will rely heavily on self-control.
Self-control is internal control that occurs through self-management and self-discipline in fulfilling work and personal responsibilities.
Managers can gain a lot by assuming that people are ready and willing to exercise self-control in work. But, an internal control strategy requires trust. When people are willing to work on their own and exercise self-control, managers have to have the confidence to give them the freedom to do
so. Self-control is most likely when the process used to set objectives and standards is participative. The potential for self-control also increases when capable people have a clear sense of the organization’s mission and the resources to do their jobs. The potential for self-control is also greater
in inclusive organizational cultures in which everyone treats everyone else with respect and consideration.
It’s important to think about self-control as a capacity, even a life skill. How good are you at taking control of your time and maintaining a healthy work-life balance? Do you ever wonder who’s in control, you or your phone? It used to be that we sometimes took work home, did a bit, put it
away, and took it back to work the next day. Now work is always there, on the computer and in our e-mails and messaging apps. All this is habit forming, and some of us handle this intrusion into our non-work lives better than others.10
Insight: Learn about Yourself
“Resilient people are like trees bending in the wind…. They bounce back.”
Resiliency Offers Strength from Within
Managerial control is all about how to increase the probability that things go right for organizations even as they deal with an increasing number of operational complexities. It’s the same for us every day, in our work and personal lives. We need to spot and understand where
things are going according to plan or going off course. We need to have the courage and confidence to change approaches that aren’t working well. Our success, simply put, depends a lot on resiliency-the ability to call on inner strength and keep moving forward even when
things are tough.
Think of resiliency in personal terms-caring for an aging parent with a terrible disease or single parenthood with small children. Think of it in career terms—juggling personal and work responsibilities, continuously attending to e-mails, voice mails, instant messages, and
rushing to many scheduled and unscheduled meetings. We need to be managed, we need to exercise control, and we need staying power to perform over the long term. Resiliency helps us hold on and keep things moving forward even in the face of personal and professional
adversity.
Resilient people face up to challenges; they don’t hide or back away from them. They develop strategies, make plans, and find opportunity even in challenging situations. Dr. Steven M. Southwick, professor of psychiatry at Yale University, says “Resilient people are like trees
bending in the wind…. They bounce back.” Does this description fit you … or not? Why?
Resiliency Quick Test
Score yourself from 1 = don’t at all agree, to 5 = totally agree, on the following items:
• I am an upbeat person for the most part.
• Uncertainty and ambiguity don’t much bother me.
• I tend to adapt quickly as things change.
• I can see positives even when things go wrong.
• I am good at learning from experience.
• I am good at problem solving.
• I am strong and hold up well when times are tough.
• I have been able to turn bad situations into positive gains.
Get To Know Yourself Better
Take the Resiliency Quick Test. A score of 35 or better suggests you are highly resilient; with any lower score you should question how well you hold up under pressure. Double-check the test results by looking at your behavior. Write notes
on how you handle situations like a poor grade at school, a put-down from a friend, a denial letter from a job application, or criticism from a supervisor or co-worker on your job. Summarize what you’ve learned in a memo to yourself about
how you might benefit from showing more resiliency in difficult situations.
Bureaucratic Control
One form of external control uses authority, policies, procedures, job descriptions, budgets, and day-to-day supervision to encourage people to work toward organizational interests. It’s called bureaucratic control, control that flows through the organization’s hierarchy of authority.
Organizations typically have policies and procedures regarding sexual harassment, for example. Their goal is encourage members to behave respectfully and with no suggestion of sexual pressure or impropriety. Organizations also use budgets for personnel, equipment, travel expenses to keep
behavior targeted within set limits.
Bureaucratic control influences behavior through authority, policies, procedures, job descriptions, budgets, and day-to-day supervision.
Another level of bureaucratic control comes from laws and regulations. An example is the Sarbanes-Oxley Act of 2002 (SOX), which establishes procedures to regulate financial reporting and governance in publicly traded corporations.11 SOX was passed in response to major corporate
scandals over inaccurate financial reports. Under SOX, chief executives and chief financial officers must personally sign off on financial reports and certify their accuracy. Those who misstate financial records can go to jail and face substantial personal fines. Many firms now appoint chief
compliance officers (CCOs) and set up compliance departments. They are most effective when the CCO reports directly the chief executive or to the board of directors.12 Actions are also being taken to strengthen governance by boards. Stricter management oversight is evident in moves for
directors to become more actively involved in leadership and to separate the CEO and board chairman roles.13
Clan Control
Whereas bureaucratic control emphasizes hierarchy and authority, clan control influences behavior through norms and expectations set by the organization’s culture. Sometimes called normative control, it harnesses the power of cohesiveness and collective identity to influence behavior in
teams and organizations.
Clan control influences behavior through norms and expectations set by the organizational culture.
Analysis: Make Data Your Friend
Office workers get distracted as often as once every 3 minutes; it can take 23 minutes to refocus after a major interruption.
Small Distractions Can Be Goal Killers
Hiya Images/Corbis/Getty Images
Most of us work with good intentions. But when distractions hit, focus gets lost, plans fall by the wayside, and progress suffers. Whether it’s chatting with co-workers, following social media, or tackling electronic in-boxes, interruptions are more plentiful than we might admit.
• Office workers get distracted as often as once every 3 minutes and it takes an average of 23 minutes to refocus after a major interruption.
• Handling up to 100 electronic messages can kill up to one-half of a workday.
• Facilitators of disruptions include open-plan office spaces, use of multiple electronic devices, and constant checking of social media and messaging windows.
Lacy Roberson, eBay’s director of learning and organization development, calls the situation an epidemic” and says it’s hard for people to get their work done with all the interruptions and the strain that they cause. The fight against disruptions causes some employees to start
their day very early or to stay late to get their jobs done. Employers are starting to fight back and to try to protect “real work” time.
“No devices” is a rule at some eBay meetings. Intel is experimenting with allowing workers blocks of “think time” where they don’t answer messages or attend meetings. Abbot Laboratories is retraining workers to use the telephone rather than e-mail for many internal office
communications.
Your Thoughts?
How prone are you to letting distractions consume your time? Does this problem apply to your personal affairs and relationships, not just work? It’s interesting that some employers are trying to step in and set policies that might minimize
the negative impact of distractions, particularly electronic ones. Where’s the self-control? Aren’t there things we can all do to protect our time and keep our work and goals on track?
Clan control happens as people who share values and identify strongly with one another behave in consistent ways. Just look around the typical college classroom and campus. You’ll see clan control reflected in how students dress, use language, and act in class and during leisure time. People
typically behave according to the expectations of peers and the groups with whom they identify. The same holds true in organizations, where clan control influences the members of teams and work groups to display common behavior patterns.
Market Control
Market control is essentially the influence of customers and competition on the behavior of organizations and their members. Business firms show the influence of market control in the way that they adjust products, pricing, promotions, and other practices in response to consumer
feedback and what competitors are doing. A good example is the growing emphasis on green products and sustainability practices. When a firm like Walmart starts to get positive publicity from setting goals linked to climate change and sustainability, for example, the effect is felt by
competitors.14 They have to adjust their practices to avoid losing the public relations advantage. In this sense the time-worn phrase “keeping up with the competition” is really another way of expressing the dynamics of market controls in action.
Market control is essentially the influence of market competition on the behavior of organizations and their members.
Organizing is the process of arranging, connecting, and integrating people and resources to accomplish a goal. Its purpose as one of the basic functions of management is a division of labor and coordination of processes and results to achieve a common purpose.
Zoom Out
Organizing arranges, connects, and integrates people and resources to accomplish a common purpose.
Figure 11.1 shows the role that organizing plays in the management process. Once plans are created, the manager’s task is to ensure they are carried out. Once strategy is set and plans are made, organizing launches implementation and accomplishment by clarifying jobs and working
relationships. It identifies who does what, who is in charge of whom, and how different people and parts of the organization relate to and work with one another. All of this can be done in many different ways. The challenge is to choose the best organizational form to fit the firm’s strategy and
other situational/market demands.
What Is Organization Structure?
The way in which the parts of an organization are arranged is usually referred to as organization structure. It is the system of tasks, workflows, reporting relationships, and communication channels connecting the work and activities of people and groups in a firm. An organization’s
structure should both allocate tasks through a division of labor and coordinate performance results. A structure that accomplishes both well helps accomplish an organization’s strategy. But as stated earlier, the problem for managers is that it is much easier to describe what a good structure
does than it is to create one.
Organization structure is a system of tasks, reporting relationships, and communication linkages.
Organizing-
to create structures
• Divide up the work
• Arrange resources
• Coordinate activities
Planning —
to set the direction
Controlling-
to ensure results
Leading-
to inspire effort
FIGURE 11.1 Organizing viewed in relationship with the other management functions.
Formal Structures
You may know the concept of structure best in the form of an organization chart. It diagrams reporting relationships and work positions.3 A typical organization chart identifies positions, job titles and the lines of authority and communication between them. It shows the formal
structure, and how the organization is intended to function. But you have to interpret this information with caution. Charts can be useful… or confusing and out of date. At best, they provide a snapshot of how an organization is supposed to work in respect to:
• Division of work-Positions and titles show work responsibilities.
Supervisory relationships-Lines show who reports to whom.
Communication channels-Lines show formal communication flows.
Major subunits-Positions reporting to a common manager are shown.
• Levels of management-Vertical layers of management are shown.
.
An organization chart describes the arrangement of work positions within an organization.
Formal structure is the official structure of the organization.
Informal Structures and Social Networks
Underneath an organization’s formal structure is an informal structure. This is a “shadow” organization made up of social networks of unofficial, but important, working relationships connecting organizational members.
Informal structure is the set of social networks found in unofficial relationships among the members of an organization.
Look at Figure 11.2. No organization can be fully understood without understanding its web of informal networks as well as the formal organizational structure. 4 If the informal structure could be drawn, it would show who talks and interacts with whom, regardless of their formal titles and
relationships. The lines of the informal structure cut across levels and move from side to side. They show people interacting through social media, meeting for coffee, joining in exercise groups, and participating in leisure activities-all driven by friendship rather than formal requirements.
A tool known as social network analysis, or sociometrics, is one way of identifying informal structures and social relationships.5 This analysis can be done by surveys that ask people to identify others they ask for help most often, with whom they communicate regularly, and who give
them energy and motivation. It can also be done using data mined from an organization’s social media sites, and even with data gathered from special electronic badges worn by employees and that record their interactions. Lines are then drawn to create a social network map or informal
structure that shows how a lot of work really gets done and who the “influencers” really are. This information can be used to update the organization chart to reflect how things actually work. It also helps legitimate the informal networks people use in their daily work and identifies talented
people whose value as connectors and networkers may otherwise go unnoticed by management. S
Social network analysis or sociometrics identifies the informal structures and their embedded social relationships that are active in an organization.
FIGURE 11.2 Informal structures and the “shadow” organization.
Informal structures and social networks bring advantages that are essential to organizational success. They allow people to make contacts with others who can help them get things done. They stimulate informal learning as people work and interact throughout the workday. And, they are also
sources of emotional support and friendship that satisfy social needs.
Of course, informal structures also have potential disadvantages. They can be susceptible to rumor, carry inaccurate information, breed resistance to change, and even divert work efforts from important objectives. Another problem sometimes found in informal structures is “in” and “out”
groups. Those who perceive themselves as “outsiders” may become less engaged in their work and more dissatisfied.
Organizing is the process of arranging, connecting, and integrating people and resources to accomplish a goal. Its purpose as one of the basic functions of management is a division of labor and coordination of processes and results to achieve a common purpose.
Zoom Out
Organizing arranges, connects, and integrates people and resources to accomplish a common purpose.
Figure 11.1 shows the role that organizing plays in the management process. Once plans are created, the manager’s task is to ensure they are carried out. Once strategy is set and plans are made, organizing launches implementation and accomplishment by clarifying jobs and working
relationships. It identifies who does what, who is in charge of whom, and how different people and parts of the organization relate to and work with one another. All of this can be done in many different ways. The challenge is to choose the best organizational form to fit the firm’s strategy and
other situational/market demands.
What Is Organization Structure?
The way in which the parts of an organization are arranged is usually referred to as organization structure. It is the system of tasks, workflows, reporting relationships, and communication channels connecting the work and activities of people and groups in a firm. An organization’s
structure should both allocate tasks through a division of labor and coordinate performance results. A structure that accomplishes both well helps accomplish an organization’s strategy. But as stated earlier, the problem for managers is that it is much easier to describe what a good structure
does than it is to create one.
Organization structure is a system of tasks, reporting relationships, and communication linkages.
Organizing-
to create structures
• Divide up the work
• Arrange resources
• Coordinate activities
Planning —
to set the direction
Controlling-
to ensure results
Leading-
to inspire effort
FIGURE 11.1 Organizing viewed in relationship with the other management functions.
Formal Structures
You may know the concept of structure best in the form of an organization chart. It diagrams reporting relationships and work positions.3 A typical organization chart identifies positions, job titles and the lines of authority and communication between them. It shows the formal
structure, and how the organization is intended to function. But you have to interpret this information with caution. Charts can be useful… or confusing and out of date. At best, they provide a snapshot of how an organization is supposed to work in respect to:
• Division of work-Positions and titles show work responsibilities.
Supervisory relationships-Lines show who reports to whom.
Communication channels-Lines show formal communication flows.
Major subunits-Positions reporting to a common manager are shown.
• Levels of management-Vertical layers of management are shown.
.
An organization chart describes the arrangement of work positions within an organization.
Formal structure is the official structure of the organization.
Informal Structures and Social Networks
Underneath an organization’s formal structure is an informal structure. This is a “shadow” organization made up of social networks of unofficial, but important, working relationships connecting organizational members.
Informal structure is the set of social networks found in unofficial relationships among the members of an organization.
Look at Figure 11.2. No organization can be fully understood without understanding its web of informal networks as well as the formal organizational structure. 4 If the informal structure could be drawn, it would show who talks and interacts with whom, regardless of their formal titles and
relationships. The lines of the informal structure cut across levels and move from side to side. They show people interacting through social media, meeting for coffee, joining in exercise groups, and participating in leisure activities-all driven by friendship rather than formal requirements.
A tool known as social network analysis, or sociometrics, is one way of identifying informal structures and social relationships.5 This analysis can be done by surveys that ask people to identify others they ask for help most often, with whom they communicate regularly, and who give
them energy and motivation. It can also be done using data mined from an organization’s social media sites, and even with data gathered from special electronic badges worn by employees and that record their interactions. Lines are then drawn to create a social network map or informal
structure that shows how a lot of work really gets done and who the “influencers” really are. This information can be used to update the organization chart to reflect how things actually work. It also helps legitimate the informal networks people use in their daily work and identifies talented
people whose value as connectors and networkers may otherwise go unnoticed by management. S
Social network analysis or sociometrics identifies the informal structures and their embedded social relationships that are active in an organization.
FIGURE 11.2 Informal structures and the “shadow” organization.
Informal structures and social networks bring advantages that are essential to organizational success. They allow people to make contacts with others who can help them get things done. They stimulate informal learning as people work and interact throughout the workday. And, they are also
sources of emotional support and friendship that satisfy social needs.
Of course, informal structures also have potential disadvantages. They can be susceptible to rumor, carry inaccurate information, breed resistance to change, and even divert work efforts from important objectives. Another problem sometimes found in informal structures is “in” and “out”
groups. Those who perceive themselves as “outsiders” may become less engaged in their work and more dissatisfied.
Functional Structures
In functional structures, people with similar skills and who perform similar tasks are grouped together into formal work units. Members of functional departments share technical expertise, interests, and responsibilities. The first example in Figure 11.3 shows a functional structure you
might find in a medium-sized business, with top management arranged by the functions of marketing, finance, technology, and human resources. Under this structure, sales tasks are the responsibility of the Chief Sales Officer, data networks and information systems tasks are the
responsibility of the Chief Technology Officer, and so on. The figure also shows how functional structures are used in other types of organizations such as banks and hospitals.
A functional structure groups together people with similar skills who perform similar tasks.
President
Business
Firm
Chief Sales
Chief Finance
Chief Talent
Chief Technology
Officer
Officer
Officer
Officer
Branch Manager
Branch
Bank
Manager
Manager
Manager
Digital
Banking
Manager
Commerical
Banking
Relationship
Banking
Auditing &
Control
Executive Director
Community
Hospital
Director
Director
Director
Director
Medical
Staff
Nursing
Staff
Billing &
Finance
Human
Resources
FIGURE 11.3 Functional structures in a business firm, branch bank, and community hospital.
Advantages of Functional Structures
The goal of the functional structure is to put together people with the same expertise and help
together. fund
does its work properly, the organization as a wh
successful. These structures work well organizations only a products or vice:
They also tend to work best in relatively stable environments where problems are predictable and the demands for change and innovation are limited. The major advantages of functional structures include the following:
• Economies of scale with efficient use of resources.
• Task assignments consistent with expertise and training.
High-quality technical problem solving.
• In-depth training and skill development within functions.
• Clear career paths within functions.
Disadvantages of Functional Structures
One of the major problems with functional structures is the tendency for each department or function to focus primarily on its own concerns, avoid communications with other functions, and neglect “big picture” issues. There is too little cross-functional collaboration as a sense of common
purpose gets lost and as self-centered and narrow viewpoints become emphasized. 10 This is shown in Figure 11.4, as the functional chimneys or functional silos problem-a lack of communication, coordination, and problem solving across functions. A Wall Street Journal reporter
describes the problem this way: “How do you get aggressive, fast-talking salespeople to cooperate with reserved, detail-oriented engineers?”11
The functional chimneys or functional silos problem is a lack of communication, coordination, and problem solving across functions.
Organizations are supposed to be cooperative systems, but the functional chimneys problem builds invisible walls that hinder collaboration across functions. This happens because the functions become formalized not only on the organization chart, but also in people’s mind-sets. Members of
various functions end up viewing the function as the center of the organizational world rather than as one among many important parts that need to be working together. This problem tends to get worse as organizations get larger and as the functions get more specialized.
• Too little communication across functions
• Too many problems referred upward for solution
FIGURE 11.4 The ‘Functional Chimneys’ problem in organizations.
Divisional Structures
A second organizing alternative is the divisional structure. As illustrated in Figure 11.5, this structure puts together people who work on the same product or process, serve similar customers, or are located in the same geographical region. The idea is to overcome some of the
disadvantages of a functional structure, especially the “functional chimneys” problem. Divisional structures are common in organizations with diverse operations extending across many products, territories, customer segments, and work processes. 12
A divisional structure groups together people working on the same product, in the same area, with similar customers, or on the same processes.
Types of Divisional Structures
Product structures group together jobs and activities focused on a single product or service. They clearly link costs, profits, problems, and successes in a market area with a central point of accountability. This prompts managers to be responsive to changing market demands and customer
tastes. Procter & Gamble, for example, is organized around six divisions: grooming, health care, beauty care, fabric and home care, baby and feminine care, family care and new ventures.13
A product structure groups together people and jobs focused on a single product or service.
Type
Focus
Example
General Manager
Product
Good or
service produced
Grocery products Drugs and toiletries
President
Geographical
Location of
activity
Asian division
European division
Agency Administrator
Customer
Customer or
client serviced
Problem youth
Senior citizens