Managing Organizational Structure Change

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Managing Organizational Structure Change
LDR 531

Managing Organizational Structure Change
Smith & Falmouth (S&F), a mid-sized phone and mail order product company, has expanded into the online product market. S&F created S&;F Online as an independent business unit while it proves the strategic viability and value of online as a sales channel. S&F Online is made up of a small team that has been successful, and is now working to increase sales and diversify their online offerings to add health and beauty services. As S&F Online grows, it needs to determine the best organizational structure to support its business strategy and builds on its current organizational culture.

Current Organizational Structure
S&F Online is currently a
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Considerations. In order to successfully design a matrix organization, though, a few key considerations need to be planned for. First, informal communication channels need to be developed and leadership needs to watch for any signs of organizational silos.
Effective communication among the dimensions of the matrix structure is essential for a successful implementation. A great deal of this communication is informal in nature, leading to voluntary coordination among employees. Informal communication relies on personal networks and relationships built on trust. One barrier to informal communication is organizational silos. Leaders must break down these silos whenever possible (Galbraith, 2010, p.6).
Next, it is important for cross-departmental goal achievement that the rewards be aligned for all areas. “The goals of the different matrix dimensions must be aligned to work together. The more dimensions that exist, the more likely it is that fragmentation will occur” (Galbraith, 2010, p.6).
Lastly, since the unity-of-command is no longer in existence, i.e., there are essentially two bosses (functional and product managers) there needs to be absolute clarity in the work priorities. “When you dispense with the
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