Divisional structure. Divisional management structure powers of the corporate center and divisions - abstract Divisional organizational structure is effective for the conditions

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A divisional management structure is a set of independent divisions that are part of an organization, spatially separated from each other, having their own sphere of activity, independently solving current production and economic issues. The diagram of the divisional management structure is presented in Appendix No. 1.

With a territorial approach to building the structure of such an organization, each of its divisions specializes in producing a full range of products and services for the needs of a given region. This allows you to save money by concentrating commercial operations in one place, better take into account local conditions, and maintain personal contacts.

With a product approach to the formation of the structure of an organization, each of its divisions is focused on producing one type of product or service for all groups of consumers living in the territory where the company operates. Due to the specialization of production, it is possible to significantly increase its quality and efficiency, and orient it to the real needs of the market.

The market approach to the formation of an organizational structure is that each division produces products or provides services, focusing on a certain group of buyers, which together form the market.

Finally, the innovative approach involves the creation within the organization of special centers involved in the development, development and deployment of production of new types of products and services. It turns out that while some divisions are producing products that are currently in demand, others are already preparing replacements for them. This provides the organization with additional competitiveness and sustainability.

Thus, the scope of application of the divisional management structure: James L. Gibson, D. Ivantsevich, James H. Donnelly - Jr. "Organizations: behavior, structure, processes." - M.: Infra - M, 2000. S. 263

· diversified enterprises;

· enterprises located in different regions;

· enterprises carrying out complex innovative processes.

· the divisions that form the divisional structure are united among themselves, as well as with a common center through production, financial and administrative connections.

Production connections can be both technological and product. Technological ones are based on the fact that each department performs only individual operations in the production chain of the final product. Their activities are not embodied in a finished product that has independent meaning. Product ties imply that there is an exchange of finished products that are intended for use not only within the organization, but also externally.

Within the framework of administrative relations, the management of the organization communicates to the divisions binding decisions aimed at achieving specific results, sets goals and basic standards for their activities, and monitors their implementation.

Financial ties are realized either through the formation within the organization and subsequent redistribution between its divisions of a centralized fund of funds, or through financial control over their activities. The latter monitors the correctness of spending money, the timeliness of their receipt, etc.

Specific management tasks under a divisional management structure: James L. Gibson, D. Ivantsevich, James H. Donnelly - Jr. "Organizations: behavior, structure, processes." - M.: Infra - M, 2000, p. 268

· justification of criteria, identification of projects and product groups;

· careful selection of department heads;

· ensuring a unified innovation policy in all product groups;

· prevention within a brand concept between product groups;

· prevention of autonomous separatist development of product groups;

· priority of line managers over specialists.

Large modern organizations with a divisional structure exist, as a rule, in the form of joint-stock companies and their associations.

The advantages and disadvantages of the divisional management structure are indicated in Appendix No. 1.

However, sometimes divisional structures are not flexible enough in the extremely complex and dynamic environment that high-tech companies face. Lafta J.K. Efficiency of organization management./Tutorial - M. Russian business literature, 1999. P. 209

The change in the operating conditions of firms entailed a transition to more flexible organizational structures - matrix and project models. But from the fact that the matrix structure is the most modern of the types of organizational structures considered, it does not at all follow that the functional and divisional structures are dying out.

So it is clear that there is no best structure for all companies. Moreover, during the life of one company, it may be necessary to change the form of the organizational structure several times, bringing it into line with the new goals and operating conditions of the organization. It can be argued that for every company at every stage of its development there is an effective structure in which the goals of the company are achieved in an optimal way.

Currently, there are three characteristics of an effective organizational management structure: “Management of the organization.” Edited by Z.P. Rumyantseva and N.A. Solomatina. - M.: Infra - M, 1995. P. 375

· the structure corresponds to the organization's strategy.

· the structure corresponds to the operating environment of the organization.

· absence of contradictions in the organizational structure.

In order to bring the organizational structure into line with the organization's development strategy, it is necessary, first of all, to clearly define the main activities and key links in the value chain, which are of fundamental importance for the successful implementation of the strategy. These are the links that should be the main elements of the organizational structure.

For each individual company, the set of key activities will be different. To identify them, it is necessary to determine those types of activities that must be performed especially efficiently and in a timely manner in order to achieve the company’s strategic goal, as well as to determine which types of activities, poor performance, pose a threat to the company’s existing and potential competitive advantage. These types of activities should have been key.

However, it should be noted that the set of key activities changes with changes in the company's strategy. Naturally, it is necessary to reconsider the organizational structure of management. Otherwise, it will hinder the development of the company.

Next, you need to determine whether non-core activities can be carried out outside the company more successfully and efficiently than by the company itself. The outsourcing strategy is now very popular in the West. Outsourcing involves subcontracting to small and medium-sized firms that are highly productive and efficient. In Russia, the dominant opinion is that by transferring certain types of activities to third parties, the company loses control over them, which undermines the stability of the company.

To a certain extent, this position is justified, given the low supply discipline existing in Russia. However, the potential of outsourcing in the field of cost reduction is not used, and the company's resources and attention are diverted to activities that do not affect the formation of its competitive advantage. Thus, it is advisable to outsource activities that they can perform cheaper, faster and with better quality.

Typically, a firm's achievement of competitive advantage cannot be achieved through the best execution of each of the strategic activities separately. Long-term success is ensured through the coordinated implementation of strategic activities supported by supporting and supporting units.

Thus, a management structure will be consistent with strategy if it provides good coordination of related activities. Moreover, they can be connected in different ways. For example, the sequence of operations of the technological process, the same clientele or the use of common product distribution channels, similarity of technology and personnel skills. Naturally, all aspects of strategically significant activities should be accountable to one leader. However, there are situations in which the subordination of related activities to one person is inappropriate.

This is due, first of all, to the fact that there are objective limits to expanding the sphere of responsibility of a manager without losing the controllability of the system. That is, it is necessary to find the optimal controllability rate, which in turn depends on a number of factors. This includes the importance of the work performed: the more responsible the employee’s work, the more attention his activities deserve. Therefore, fewer people are directly subordinate to the company president than lower-level managers who make less responsible decisions.

When determining the standard of control, it is also necessary to take into account the level of standardization of work processes: the more an organization relies on the standardization of work processes, the higher the standard of control can be. This is due to the reduced need for direct control by the manager. As an example, we can take organizational units in enterprises of mass machine production, where the labor of low-skilled workers is used and there are from 50 to 90 workers per foreman. Lafta J.K. Efficiency of organization management./Tutorial - M. Russian business literature, 1999. P. 98

This leads to the next factor - the level of professional training of the employee. The more trained the employees, the less attention they require from the manager and the greater the controllability rate can be.

Often, to coordinate management tasks at an enterprise, a mechanism of mutual agreements is used. Peer negotiation processes are effective in small groups. Researchers note that already in the case of 10 people, fragmentation into fractions occurs. Therefore, 5 - 7 people are considered the optimal number for reaching consensus. Reiss M. “Optimal complexity of management structures” // Problems of management theory and practice. - 2001. - No. 5. P. 61

The personal abilities of the leader and his desire for power also influence the standard of controllability. For example, a “natural” leader may significantly exceed the recommended values ​​​​developed for managers with average abilities.

Any organizational structure must have clear connections between units of strategically significant activities, as well as ensure the necessary coordination. The next step is to determine the amount of authority that is necessary to lead each department. At the same time, it is desirable to ensure an effective balance between the advantages of centralization and decentralization.

There are situations when it is not possible to subordinate related activities to one manager. Hence, divisions become isolated from each other, which is greatly facilitated by differences in goals and styles of interpersonal interactions. To resolve these problems, companies are building in special interaction tools. These may be direct contacts between managers, connecting departments, special groups and teams, intermediary managers.

A bridging job position is introduced into the organizational structure when there is a need to coordinate the activities of two or more departments, bypassing vertical channels of subordination. It should be noted here that this position does not have formal authority in relation to the connected units, but it has the information necessary for these units, which provides the “connector” with great influence in this area of ​​interaction.

A special group is created to solve a specific problem and is disbanded after completing the task. Group members meet regularly to discuss common issues throughout the period from development to launch of new products into mass production. Another method of coordination is the standing committee, which is an interdepartmental group whose members meet on a regular basis to discuss issues of common interest.

An integrator manager is a connecting position with official authority over certain aspects of the activities of coordinated units. Seven notes of management. M. ZAO "Journal Expert". 1997. C 37

These powers may include the right to sanction decisions or the right to participate in the process of their preparation, as well as control over the process of implementing decisions. If the integrator manager has the right to manage financial resources, then his role increases significantly. However, in any case, the integrator manager is not vested with direct power over the employees of the coordinated units, which remains with the heads of the units. Examples of integrative managers are the brand manager and project director in companies organized along functional lines.

The divisional management structure is a structure that is based on the allocation of large autonomous production and economic units, as well as the levels of management that correspond to them, providing such units with complete independence in conducting operations. In addition, departments are transferred to this level of responsibility in order to increase profits.

Features of the structure

Today, the divisional management structure is considered the most advanced type of modern organizational structures that pursue a hierarchical system of work. Such structures are characterized by the fact that managers are fully responsible for the results of the activities of the units they head. In this regard, the most important place in a company that uses a divisional management structure is occupied not by the person who manages the functional unit, but by those people who supervise the production departments.

What types are there?

The structuring of the company into separate divisions is carried out according to one of three main principles. In particular, according to the product principle, it is carried out taking into account the characteristics of the manufactured products or services, depending on the orientation towards a particular consumer, as well as according to the regional principle, depending on which territory the given company serves.

In this regard, there are three main types into which the divisional management structure is divided:

• Divisional-productive.
• Organizational.
• Divisional-regional.

Divisional-productive

This divisional structure of enterprise management provides for the transfer of all the powers of specialists associated with the management of the production and marketing of certain commercial products or services to one person, who becomes responsible for the entire product line. All other heads of functional services, in turn, will provide detailed reporting to the manager on this product.

Companies that use such a structure will be able to respond more quickly to any adjustments in competitive conditions, as well as the introduction of new technologies and changes in customer demand. The production of a particular product is supervised by one person, which ensures improved coordination of the work of all employees.

A possible disadvantage of this structure is that there are more costs involved since the same types of work are used for different types of products. Each individual product department has its own functional divisions.

Organizational

The divisional organizational management structure, which is focused directly on the client, provides for the grouping of divisions around certain groups of clients. The goal of this structure is to fully satisfy the needs of specific consumers as perfectly as a company that serves only one group of people does.

Thus, the divisional organizational management structure provides for maximum efficiency and an individual approach to each individual client in order to achieve the highest possible results and develop the company’s profitability.

Divisional-regional

If the company's activities extend to several regions, but in each of them it is necessary to use an individual strategy, then in this case it is best to use a divisional structure, which is based on the territorial principle.

When such a divisional management structure of an organization is used, all employees in a certain region report to one manager, who, in turn, is directly responsible to the top management of the company. This structure makes it possible to significantly simplify the solution of various problems that may be associated with local customs, peculiarities of the current legislation and, of course, the socio-economic environment. The territorial division also makes it possible to train the management personnel of the departments directly at the place of work.

Specific structures

There are several specific technologies that are actively used by companies in the current market, and each individual divisional management structure differs in its advantages and disadvantages. You will see an example of such structures below; it is recommended that you familiarize yourself with all of them and choose the most optimal one for yourself in accordance with the needs and characteristics of the company.

Globally oriented product structure

This structure is based on a divisional structure in which divisions are distributed by product, and each of them separately operates in the entire world market. The use of such a structure is quite common among companies with highly diversified products, that is, those products that differ significantly from each other in the production technology used, marketing technologies, as well as sales channels and a number of other characteristics.

First of all, such a divisional-functional management structure is used in those companies for which the differences between several manufactured products are more important than the differences between the various territories in which these products are sold. This type of structure ensures a more effective international orientation of the company, but at the same time it is characterized by lower coordination between individual divisions, as well as increased duplication of their activities. Thus, there are advantages and disadvantages of a divisional management structure, so its use may not be possible in all situations.

Globally oriented regional structure

In this case, the divisional structure is also used as a basis, but at the same time the geographical principle of construction is present. It is worth noting that in this case the national market is considered by management as one of the regional divisions. The most relevant is the use of this format of structures by those companies for which regional differences between clients are more important than differences in manufactured products. In the vast majority of cases, the use of such systems is found in areas in which products are technologically changing slowly, such as automotive production, petroleum products and many others.

The advantages of such a system include the fact that there is the closest possible relationship between several geographical regions, and the highest possible coordination of activities within them is achieved. The disadvantages are rather weak coordination of the work of individual departments, as well as duplication of work.

Mixed structure

In such a system, in parallel with the emphasis on a specific product, connections of functional and territorial types are also added. This format of structures appeared due to the fact that each individual of the above structures has both its own advantages and disadvantages, which significantly limited the possibilities of their application, and there is no such divisional type of management structure that could be called ideal. The organizational structure must be built in full accordance with the specific operating conditions of the company. Such conditions for fairly large objects are quite complex and varied. They cannot be matched by any organizational structure made in its original form.

Recently, the use of a mixed system has become quite common in various companies operating in the United States.

What are the advantages and disadvantages of all such systems?

Taking into account all the information presented above, we can highlight the following disadvantages and advantages of a divisional management structure.

Advantages

• The use of divisional structures allows a company to devote the same amount of attention to a specific product, customer, or geographic region as a specialized company that operates only in a specific area. Thus, the fastest possible response to any changes that arise in the external environment is achieved, and extremely rapid adaptation to changes in certain conditions is ensured.
• This format of the management structure provides an opportunity to focus on achieving the final results of the company’s activities, including the production of specific types of products, meeting the needs of a specific consumer, as well as saturation of a certain regional market with goods. Among other things, this structure simplifies management, making it much easier for senior managers to work.
• Operational management is completely separated from strategic management, as a result of which representatives of the company's senior management begin to concentrate on management and strategic planning.
• Responsibility for profit is transferred entirely to the level of individual divisions, and decentralization of any management decisions that require urgency is ensured. In this way, management begins to become more attuned to market issues, and communication also improves significantly.
• The breadth of thinking is significantly developing, as well as the flexibility of perception and entrepreneurship on the part of the leaders of each department.

Flaws

• The linear-divisional management structure significantly increased the growth of hierarchy. In other words, there was a requirement for the formation of intermediate levels of management in order to coordinate the work of individual groups of employees.
• The goals of each specific department can be opposed to the general goals of the company’s development, that is, when the interests of the top and bottom managers in the hierarchy begin to diverge.
• Various conflicts between departments may appear in the process of work, for example, when there is a shortage of key resources that are distributed centrally. In addition, there is also not the highest coordination of the activities of departments, disunity of headquarters services and, accordingly, a weakening of horizontal ties.
• In most cases, there is far from the most efficient use of resources, but at the same time there is absolutely no opportunity to use them fully, since the resources are completely assigned to a specific department. At the same time, the amount of expenses for maintaining the management apparatus also increases, because the same functions are duplicated in departments, and, consequently, the number of personnel also increases.
• It is far from easy to control the entire process from top to bottom, since a multi-level hierarchy is used within the boundaries of the departments themselves. In addition, they may exhibit all the shortcomings that linear, functional, matrix, and divisional management structures have.
• There may be limitations in professional development on the part of department specialists, because their teams are not as large as is observed in the case of using a linear-functional structure at the level of various companies.

What to choose?

The most developed divisional management structures today include those systems that are based on the use of strategic business units. The use of such a structure is often found in companies that have a large number of independent divisions that are quite close to each other in terms of their activity profile. In this case, in order to coordinate them with each other, specialized intermediate management bodies are used, which are located between top management and departments.