Posts tagged “Organization Design


Posted on October 21, 2016


Some drive-through restaurants utilize off-site locations to receive orders – the speaker by the menu board is run through a call center team, and orders are routed electronically to a screen in the restaurant. You don’t actually interact with someone at the restaurant location until you get to the pick-up window. The ability to distribute process activities across physical locations has been convincingly demonstrated. You can decouple activities and geography, people from organization reporting lines, processes from technology, and products from sales channels. It’s an opportunity and a challenge to appropriately balance the dimensions. I once had a social conversation with a business executive who could not understand the difference between television content (shows) and television networks (channels). It’s no wonder some companies go…

Thoughts on Organization Structure

Posted on June 1, 2013


Many features of large organization structures today can be traced back to historical innovations in the transportation industry. In the 1800s expanding railroad firms put in place the first administrative hierarchies in American business. Lower-frequency support activities were separated from higher-frequency operational activities in order to effectively manage a larger and more complex set of operations. As this decentralized line-and-staff concept became more prevalent, it provided a workable framework to minimize transaction costs as firms increasingly merged end-to-end systems (e.g., railroads expanded into adjoining territories, manufacturers expanded into distribution). In the 1920s General Motors further evolved large organization structures by creating semi-autonomous operating divisions organized along product, brand or geographic lines. This multidivisional corporate form increased internal coordination and enabled top firm leadership to…