1. Organizational
Strategy & Structure
Presented by
Group 4 _ Section C
Anand Kumar 12P127
Bhoomi Ashwin 12P131
Chirayu Gandhi 12P135
Rakshit Sharma 12P160
Saurabh Saxena 12P167
Soumyajit Sengupta 12P171
Under the able guidance of
Prof. Amit Gupta &
Prof. Anil Anand Pathak

2. Organization Structure
 Organization Structure is typically the hierarchical
arrangement of lines of authority, communications, rights and
duties of an organization
 It determines how the roles, power and responsibilities are
assigned, controlled, and coordinated, and how information
flows between the different levels of management
 Organization Structure defines 3 key components
 It designates formal reporting relationships
 It identifies the grouping together of individuals
 It includes the design of systems to ensure effective
communication, coordination and integration across
departments

3. Organization Structure
 Organization Structure is reflected in an Organization Chart
 Organization Chart is the visual representation of a whole set
of underlying activities and processes in an organization
 After the Industrial Revolution, Organization Structure came
into existence, largely to increase efficiency
 In the modern day, a hierarchical structure is not always viable
and different companies adopt different structures

4. Information Sharing
 Organization Design requires both vertical and horizontal flow
of information
 Vertical flow of information emphasizes on efficiency and
control, thus calling for centralized decision making
 On the other hand, Horizontal flow of information emphasizes
on learning and adaption, resulting in decentralized decision
making
 Each of these flows makes use of structural devices

5. Information Sharing
 Vertical Information Sharing
 Hierarchical Referral
 Rules and Plans
 Vertical Information Systems
 Horizontal Information Sharing
 Information Systems
 Direct Contact
 Task Forces
 Full-Time Integrator
 Teams

6. Grouping Options
 Functional Grouping: Places together employees who perform
similar functions or work processes
 Divisional Grouping: People are organized according to what
the organization produces
 Multifocused Grouping: Organization embraces two or more
structural grouping alternatives simultaneously
 Horizontal Grouping: Employees are organized around core
work processes
 Virtual Network Grouping: Organization is a loosely connected
cluster of separate components

7. Functional Structure
 In this activities are grouped together by common
function from the bottom to the top of the
organization
 Most effective when in-depth expertise is critical to
meet organizational goals and efficiency is
important
 It is centralized, as decisions are forced all the way
to the top
 In the modern world, companies find it hard to be
successful with this structure
 Organizations compensate by installing horizontal
linkages

8. Functional Structure
STRENGTHS WEAKNESSES
Allows Economics of scale within Slow response time to
functional departments environmental changes
Enables in-depth knowledge and May cause decisions to pile on
skill development top;
Hierarchy overload
Enables organization to Leads to poor horizontal
accomplish functional goals coordination among departments
Is best with only one or a few Results in less innovation
products
Involves restricted view of
organizational goals

9. Divisional Structure
 It is also sometimes known as Product Structure or Strategic
Business Units
 Divisions can be organized based on products, services,
divisions, etc.
 Its distinctive feature is that grouping is based on
organizational outputs
 Unless effective horizontal mechanisms are in place, a
divisional structure can hurt overall performance

10. Divisional Structure
STRENGTHS WEAKNESSES
Suited to fast changes in unstable Eliminates Economies of scale in
environment functional departments
Leads to customer satisfaction Leads to poor coordination across
because product responsibility product lines
and contact points are clear
Involves high coordination across Eliminates in-depth competence
functions and technical specialization
Allow units to adapt to differences Makes integration and
in products, regions, customers standardization across product
lines difficult
Best in large organizations with
several products
Decentralizes decision making

11. Matrix Structure
 This can be used when both technical expertise
and product innovation and change are
important to organizational goals
 Unique characteristic is that both product divisions
and functional structures (horizontal and vertical)
are implemented simultaneously
 Conditions for Matrix Structure
 Condition 1: Pressure exists to share scarce
resources across product lines
 Condition 2: Environmental pressure exists for
two or more critical outputs
 Condition 3: Environmental domain of the
organization is both complex and uncertain

12. Matrix Structure
 Companies have found balancing of horizontal and vertical
structures
 Two matrix structures have evolved: Functional Matrix &
Product Matrix
 Works best when there is high environmental change and
goals reflect dual requirement
 Works best when there are few product lines as too many
product lines cause difficulty in coordination of both directions

13. Matrix Structure
STRENGTHS WEAKNESSES
Achieve coordination necessary to Causes participants to experience
meet dual demands from dual authority which can be
customers frustrating and confusing
Flexible sharing of human Means participants need good
resources across products interpersonal skills and extensive
training
Suited to complex decisions and Is time consuming; involves
frequent changes in unstable frequent meetings and conflict
environment resolution sessions
Provides opportunity for both Will not work unless participants
functional and product skill understand it and adopt collegial
development rather than vertical type
relationship
Best in medium-sized organizations Requires great effort to maintain
with multiple product power balance

14. Horizontal Structure
 It organizes employees around core processes
 Organizations shift towards this structure by
Reengineering, which means redesigning a
vertical organization along its horizontal workflows
and processes
 Process is an organized group of related tasks and
activities that work together to transform inputs
and outputs that create value for customers
 Many companies are now moving towards the
Horizontal Structure

15. Horizontal Structure
STRENGTHS WEAKNESSES
Promotes flexibility and rapid Determining core processes is
response to changes in customer difficult and time consuming
needs
Directs the attention of everyone Requires changes in culture, job
towards the production and design, management philosophy,
delivery of value to the customers and information and reward
systems
Each employee has a broader Traditional managers may balk
view of organizational goals when they have to give up power
and authority
Promotes a focus on teamwork Requires significant training of
and collaboration employees to work effectively in a
horizontal team environment

16. Strategy & Structure
 Strategy is a company’s plan to achieve a set of goals
 Strategy & Structure of an organization are intricately
bound and should be closely linked to achieve chosen
results
 Once the organizational strategy is in place, the company
can choose the optimum structure to go about
implementing it

17. About
 Tata Consultancy Services is the most leading IT services, business
solutions and outsourcing organization in India
 It organizes its global operations into integrated, customer-centric
units to enhance customer focus, drive operational agility and
address new growth opportunities in the market
 TCS has over 263,000 of the world's best trained IT consultants in more
than 50 countries and year-end revenues of more than $10 billion
 With such a large employee base, it needs a structure that allows us
to build a nimble organization to capture new growth opportunities

18. The Changing Structure
 The IT firm tweaked its management
structure to bring in greater vertical
focus within the firm
 The company has a vertical
structure under which the company
has 23 separate business units, and
each unit’s head reports directly to
the CEO
 The heads will own the profit and
loss aggregated from those of the
individual ISUs within their stack;
country heads don't own P&Ls
 It is not a major change, similar to
Infosys executive council model
focusing more on vertical structure

19. Organizational Structure
 TCS has tried to find the middle ground between the 'Vertical vs.
Horizontal' structure, with clients clustered vertically within the business
so that they can benefit from shared expertise in each ISU, supported
by horizontal groups focusing on strategic and tactical company-wide
initiatives
 It makes the company 'stove-piped', resulting in reduced economies
of scale, flexibility and agility but its process/technology excellence,
resource management, and strategic initiatives as horizontal units is
clearly trying to counter this risk
 Major verticals have their own ISUs but clients could just as well be
clustered, not by industry vertical, but by the problem they are trying
to solve, or the technology utilized, or geographic region.

20. Growth and empowerment
 The model provides customers with a single view of TCS
encompassing project delivery and relationship
management and enable a sharper focus on the
customer
 It will provide more opportunities for leadership growth
at all levels to run business units with growth and profit
responsibilities
 The modular structure will simplify the customer interface
to adapt to specific customer and market requirements
while ensuring a uniform global service delivery
 The structure will also support greater focus for strategic
initiatives that will help drive non-linear revenue growth
and leverage TCS sales, delivery and customer
relationships as required

21. Starbucks - Matrix Structure
 Form in which there are multiple
lines of authority and some
individuals report to at least two
managers.
 Made up of cross functional work
teams that have the ability to
report to heads of the organization
other than the primary supervisor.
 Successful communication
upward, downward, and laterally
with its employees.
 All channel communication
allowing employees to
communicate actively with each
other, making all members free to
contribute

22. Love Coffee Love People !
 District managers oversee regional groupings of stores.
 These district managers report directly to the Starbucks Corporation.
 At each store, a store manager acts as the chief.
 Under this store manager are a collection of shift supervisors who act
as managers on duty when the store manager is out.
 Below the shift supervisors are the rest of the employees, referred to
as baristas.

23. Love Coffee Love People !
Organizational Distribution
Three-region organizational structure:
 China and Asia Pacific: All Asia Pacific markets and China
 Americas: United States, Canada, Mexico and Latin America
 EMEA: Europe, U.K., Middle East, Russia and Africa
 A president for each region will oversee the company-
operated retail business, working closely with both the licensed
and joint-venture business
 They will also work closely with Starbucks Global Consumer
Products and Foodservice team.
 All three new regional presidents – Burrows, Culver and Gass -
along with Hansberry and Young-Scrivner will report to Schultz,
CEO.

24. Love Coffee Love People !
Employees as “Partners”
 While Starbucks workers also have more specific titles, including
barista and shift supervisor, the Starbucks corporation has long
referred to their workers as "partners."
 This term is intended to make clear how integral Starbucks
employees, no matter how low on the chain, are to the
company's success.

25. Love Coffee Love People !
Effects of Matrix Structure
 Productivity - implementing the concepts of lean manufacturing to raise
the efficiency and productivity of its stores.
 Empowerment - delivering great customer experience, supporting in
doing the right thing and conducting business with integrity.
 Responsibility - playing a critical role in ensuring that Starbucks is a great
work environment and in protecting culture, reputation and brand.
 Mutual Help – Making resources available in times when needed,
including the Standards of Business Conduct and the Business Conduct
Helpline.
 Voicing Opinions – Sharing concerns and believing in opinions, knowing
that Starbucks wants to hear them and value them all.

26. Brief Interaction with Starbucks
Employees at CP(on a scale of 1-10)
 Freedom of Employees?
 8
 Standardization?
 9
 Coordination?
 8
 Recognition?
 7