Solution
| (AC1.1) Evaluate the advantages and disadvantages of different types of organisation structures, including the reasons underpinning them. Short references should be added into your narrative below. Please remember to only list your long references in the reference box provided at the end of this section. Word count: Approximately 500 words |
| Divisional Organisation Structure A divisional organisation structure in an entity operates through separating an entity to different independent groups/divisions. According to Djurayeva (2024), these are in terms of products, geographical area of operation and clients. In such an organisation, the different divisions work independently in a similar manner of a business unit in the entire organisation. In line with CIPD (2023), the different divisions are found operating independently with resources budgeted including finances, Human Resources (HR), marketing despite of reflecting to the entire set organisation objective. Advantages and Disadvantages A major advantage associated with the application of this divisional structure include an increased specialisation scope. According to Puranam (2021), this is since the different decisions such as the accounting work independently and effectively. For ADNOC (An Organisation I am Familiar with), using the divisional structure have onshore and offshore operations. The outcome of this is an increased dominance in the oil and gas sector. There are also divisions involved in the processing of oil and gas and transportation. The disadvantages on the other hand entail challenges in efficient application of finances. This is owing to the potential incurring of unnecessary costs in these divisions. Another disadvantage is divisions and larger organisation strategies and objectives lacking an appropriate matching hence ineffectiveness. Appropriateness of Structure– The application of divisional structure is appropriate in use for larger and complex entities. The divisions possess varying products/services offered to their market environment. Also, the use of the strategies and management informed by their focus and hence integrating all divisions which is case of ADNOC. Matrix Organisation Structure A matrix organisation structure is found integrating a functional and project-based practice with employees reporting to the managers. According to Cranmer et al. (2021), there is a functional and project or product and service manager at the top. Hence, the resources which are obtained in a certain system is used in the other project maintaining functional-based specialisation. An example of the organisation embracing this structure is Exxonmobil in UAE as an international subsidiary Advantages and Disadvantages For Exxon Mobil operating in UAE oil and gas sector as a subsidiary of the UK main organisation. According to Djurayeva (2024), the rationale of this is implementing their large operations in their market of operation. The matrix structure in the organisation advantage also includes seamless operations of multiple disciplines and projects in new gas fields and renewable energy sector. Also, a different advantage includes matrix structure enhancing a successful flexibility and active coordination. In lien with CIPD (2024), varying talents are brought together in a versatile manner since the communication is appropriate to manage project potential challenges. This is supported by fact Exxon Mobil is well positioned to use the matrix structure in leveraging on appropriate insights of various divisions for working in their various areas. For disadvantages, it is confusing and potential conflicts emerging since the staff are found working with various teams and reporting to various teams and managers. Also, there is a potential of lack of resources for a successful implementation of the structure. Appropriateness of Structure- This structure is appropriate for use in Exxon Mobil in an event such an entity demand implementation of projects involving varying functional specialisation. This entail being efficient, appropriate resources allocation and innovativeness core for initiating sustainable strategic planning. |
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