Organizational Structure essay




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Organizationalstructure (OS) is critical in defining the scope of the acceptablebehaviors in any given firm as well as the lines of accountabilityand authority within the departments. Based on this, it is clear thatOS plays an enormous role as far as change and innovation isconcerned (Ingram, 2015). Matrix organizational structure is seen asthe ultimate solution for global companies as it enable these firmsto align staffs along geographic, functional or product lines.However, this structure brings about conflicts as far as pulls onresources are concerned, thus greatly hinder innovation (Devaney,2014). For instance, CaterpillarInc. which is known to adopt such an organizational structure, has in therecent times faced stiff competition from its rivals Komatsufrom Japan due to power struggle within the management, thus beingunable to compete accordingly, especially after the 2007-08 financialcrisis (Colvin, 2011). Based on this, there is the need forcompanies, regardless of size, to constantly evaluate theirorganizational structures against the set goals. This will go a longway in maintaining high level of relationship between a firm and itsexternal environment, thus ensuring sustainability both in the shortand long-run.

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Inthe recent past, open market innovation has been hailed as one of thesurvival methods for any company due to the adverse effects ofglobalization. As a result, well known global companies such as EliLilly, IBM, and Boeing have adopted this type of innovation (Rigby,2002). However, in order to tap the full benefits of open marketinnovation as advocated by Henry Chesbrough, there is the urgent needfor leaders in an organization to clearly define the firm’sobjectives (Gilliard, 2015). Further, they should consider theavailable networks as well as consider adjacent products which theycan explore for the purpose of sharing ideas with the concernedstakeholders (Zook &amp Rigby, 2002).


Colvin,G. (2011). Caterpillar is absolutely crushing it. Fortune.Available at

Devaney,E. (2014). ThePros &amp Cons of 7 Popular s.Available at,M. (2015). OpenMarket Innovation. Available at,D. (2015). Why Is Important? Chorn.Available at,D. (2002). Open-market innovation. HarvardBusiness Review

Zook,C. &amp Rigby, D. (2002). Open-Market Innovation. HarvardBusiness Review