The document describes the organizational structure challenges faced by Appex Corporation. It discusses several structural changes the company tried, including circular, horizontal, functional, product+functional, and divisional structures. However, each structure had significant negatives, such as unclear decision making, lack of planning, and interdepartmental conflicts. The document suggests Appex would have benefited from a matrix structure that balances centralized and decentralized power while maintaining vertical and horizontal integration across functions and products. After being acquired by EDS, Appex still faced challenges of misaligned structures and introduced a matrix approach using EDS resources to prevent inter-organizational conflicts.
The document describes the organizational structure challenges faced by Appex Corporation. It discusses several structural changes the company tried, including circular, horizontal, functional, product+functional, and divisional structures. However, each structure had significant negatives, such as unclear decision making, lack of planning, and interdepartmental conflicts. The document suggests Appex would have benefited from a matrix structure that balances centralized and decentralized power while maintaining vertical and horizontal integration across functions and products. After being acquired by EDS, Appex still faced challenges of misaligned structures and introduced a matrix approach using EDS resources to prevent inter-organizational conflicts.
The document describes the organizational structure challenges faced by Appex Corporation. It discusses several structural changes the company tried, including circular, horizontal, functional, product+functional, and divisional structures. However, each structure had significant negatives, such as unclear decision making, lack of planning, and interdepartmental conflicts. The document suggests Appex would have benefited from a matrix structure that balances centralized and decentralized power while maintaining vertical and horizontal integration across functions and products. After being acquired by EDS, Appex still faced challenges of misaligned structures and introduced a matrix approach using EDS resources to prevent inter-organizational conflicts.
The document describes the organizational structure challenges faced by Appex Corporation. It discusses several structural changes the company tried, including circular, horizontal, functional, product+functional, and divisional structures. However, each structure had significant negatives, such as unclear decision making, lack of planning, and interdepartmental conflicts. The document suggests Appex would have benefited from a matrix structure that balances centralized and decentralized power while maintaining vertical and horizontal integration across functions and products. After being acquired by EDS, Appex still faced challenges of misaligned structures and introduced a matrix approach using EDS resources to prevent inter-organizational conflicts.
Company Background Founded in May 1986 Merger of Appex, Inc. & Lunayach Communications Consultants (LCC) Specialized in: o Management information systems o Inter carrier network services o Design and engineering solutions
1990: Rated as the fastest growing high-technology
company in the US Innovative company Everyone did anything
Challenges faced by Shikhar Ghosh
Undefined KRAs (Key Responsibility Areas) No job description, Very informal and fluid organizational structure Overwhelming work resulting into work overload Unstructured financial spending, Only fire fighting approach was in practice Lack of planning, Undefined priorities, Improper interdepartmental cooperation Soaring backlog, Un-kept promises to the customers Individualistic approach, Unclear information flow Rise of customer detracting mentality, No ownership of the issues, Chaotic environment
Structural changes- Circular structure
Characteristics Non-hierarchical, Concentric circles expanding out from executives to customers
Positives Free flow of information Theoretically customer-based Theoretically responsive structure
Negative Employees could not relate Aimed at response, not planning Unclear decision hierarchies Customer became the enemy
Negative Complete failure Employees gave no response
Structural changes- Functional structure
Characteristics Separation into functional teams Positives Focus on task completion Increased planning System for assessing accountability
Negative Extensive politics Development of sub-functions Polarization of teams Reduction on cooperation Poor skill/management matches
Structural changes- Product + Functional
Characteristics Overlay of functional representatives for each key product Positives Improved planning Application of management vs. skill to products
Negative No system of authority Extensive executive decision support No system of priorities between products
Structural changes- Product + Functional
+Business Characteristics Intermediaries between product teams and corporate management Positives Decision making authority Resource allocation authority
Negative Too many people in overhead Too many layers of management Internal process focus Loss of customer focus Loss of P&L accountability
Structural changes-Divisional Structure
Characteristics Separation into three divisions, ICS, IS, and Operations Positives Improved accountability, budgeting, and planning Extensive communications within divisions Negative Resource allocations squabbles Cross-divisional antagonism Second guessing of Sr. Management No cross-divisional communication or cooperation Fractal structures Financial gamesmanship
What would we have done ??
An RCA of the problems A control on the structure was required A balance between centralized and decentralized power A combination of horizontal and vertical structure Such structure is called Matrix structure Grouping the employees on the basis of function and product while maintaining the vertical and horizontal integrations between the two.
Address the new challenges
Acquired by Electronic Data Systems (EDS) New Challenges: EDS has a bureaucratic structure Appex still does not have clear structure
Solution Deploy Matrix structure at Appex and use senior resource from EDS Integrate the two teams functional areas, so the inter organization conflict does not arise
