Electrolux home products Europe and Saab training systems

Thèmes abordés

Electrolux home products, Europe, Saab training systems, company's strategy, team-based structure

Résumé du document

Companies need to be structured to improve coordination between individuals and departments and optimize their efforts. They need to implement hierarchy. But there are different possible organizations. They have to find the most appropriated to their business.

Extraits

[...] Another problem with team-based structure relates to the long decision- making process. When only one person makes the decision, it can be make quickly. But a team must meet regularly to discuss about the project, to assign roles and resolve problems and conflicts. A team may develop better idea, but when several people are required to discuss pros and cons of a decision, it takes more time than one people doing his own research and making decisions. Team-based approach could also create inter-organizational collaboration problems. [...]

[...] Indeed, functional structure allows firms to gain efficiency by strengthening economies of scale. Functional structures always allow a greater operational control with clear definition of roles and tasks. This structure was all the more best suited for Electrolux as it is an organizations which produces standardized goods and services at large volumes and rather low cost.
By introducing functional structures, Electrolux grouped people with similar knowledge and skills : employees became specialists within their own realm of expertise and the firm to improve its operational efficiency as employees. [...]

[...] This could lead to less collaboration in the company and have negative impact on cost, waste and customer satisfaction. If teams work separately without sharing information, it is for example difficult to negotiate the best prices with suppliers, and it will have an impact on the final price for customers. Finally, team-based structure ignores individual performance. This approach values team performance over individual performance. But everyone seeks recognition of its individual contribution, so it can be more difficult for someone to be invest in a team-based structure. [...]

[...] Thanks to the team-based structure, the company is more in a business- process oriented way of doing business. Information circulate quickly inside the teams, between them and with the senior management team. Coordination of projects is also easier. This responsibility is shared between the business teams and delivery teams. In addition, this kind of structure helps to reduce the degree of uncertainty and is much more flexible than the functional structure as it allows to respond flexibly to diverse customers. [...]

[...] Saab Training Systems was specialized in defense system. As the defense budgets were reduced and the industry had to face a severe competition, Saab Training Systems decided to switch its strategy by focusing its activities on its core competencies: laser-based simulation. The objectives were to speed up throughput times in development and production to introduce faster their new product and reduce delivery times. With such a strategy, the current firm structure was inefficient. As the firm was structured into various functional areas (production, development, marketing, purchasing), they experienced problems of coordination and communication due to a lack of centralization of information. [...]