CHAPTER 6:2

IMPLEMENTING STRATEGIES: ORGANISATION

STRUCTURE
6.2.1 Types of Organisations and Management
Control Systems1

(i) What is an organisation structure?

What comes first, structure or strategy?
Some said structure comes first; some said
strategy should come first; and others were
undecided. What are you saying?
(ii) Types of Organisation Structure
The type of organisation structure influences the design of management
control systems
Matching the organisation structure
fundamental task of the strategist

to

corporate

strategies

There are five basic organisation structures generally in use:

(i) functional organisation
(ii) geographic organisation
(iii) divisional organisation
(iv) strategic business unit (SBU) organisation
(v) matrix organisation

For more discussions consult Pearce and Robison, 1994: 340-348

is

Figure 2:
Typical
Structures
pp 341

Functional

Organisation

CEO

Engineering

Production

Personnel

Finance and Accounting

Marketing

A process - oriented functional structure (an electronics

distribution)
CEO

Purchasing

Receiving
and
Inventory

Order
Entry

Wholesale
Sales

Retail
Sales

Accounting
and
Billing

Customer
Service

Figure 3: Typical Geographic

Structures pp 343

Organisation

Chief Executive

Corporate Staff
Finance and Accounting
Personnel
Marketing
Legal
Planning
Research and Development

GM
Kigoma

GM
Mtwara

GM
Dodoma

GM
Mbeya

GM
Mwanza

Regional Staff
Personel
Accounting and
Control

Engineering

Production

Marketing

GM
Zanzibar

Figure 4: Typical Divisional Organisation Structures -pp 345

Chief Executive Officer

Vice President
Administrative Services

GM
Division AE

Personnel

Accounting and
Control
Division Planning

Marketing
Production/Operation

Vice President
Operating Support

GM
Division BE

GM
Division CE

Personnel

Personnel

Accounting and
Control

Accounting and
Control

Division Planning

Marketing

Division Planning
Marketing

Production/Operation

Production/Operation

Figure 5: Typical
Structures
-pp 346

Strategic

Business

Unit

Organisational

Chief Executive Officer

Vice President
Administrative Services

Group Vice President

SBU AE

Vice President
Operating Services

Group Vice President

SBU BE

Group Vice President

SBU CE

Division

Division

Division

Division

Division

Division

Division

Division

Division

Figure 6: Typical Matrix Organisational Structures

Chief Executive Officer

Vice President
Engineering

Vice President
Production

Vice President
Purchasing

Vice President
Administration

Project
Manager
A

Engineering
Staff

Production
Staff

Purchasing
Staff

Administration
Coordinator

Project
Manager
B

Engineering
Staff

Production
Staff

Purchasing
Staff

Administration
Coordinator

Project
Manager
C

Engineering
Staff

Production
Staff

Purchasing
Staff

Administration
Coordinator