Business Finance Homework Help

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Leveque– respond with 150 words – Many of the different organizations requires structures that are able to assure that everything is running as planned by top management. These days many of the top management allows the mid-level and first-level management teams to decide which structure to run the organization on. Deciding which structure would be best is all based on what the organization has in mind for themselves. Functional and divisional organizational structure is two that some of the organizations use. Functional structure “groups tasks and activities by business function, such as production and operations, marketing, finance and accounting, research and development, and management information systems” (David/David.2020). On the other hand you have a divisional organizational structure which are sometimes referred to as “segments, profit centers, or business units” (David/David.2020). Some of the advantages of functional structure are that it is simple and inexpensive, and allows for rapid decision making. The disadvantages is that accountability forced to the top, minimizes career development, and leads to communication problems. Divisional organizational advantages are that accountability is clear, employee moral is higher, and career development opportunities. The disadvantages that lie in divisional organizational advantages are that it can be costly, requires a workforce that is skillful, limited amount of sharing ideas, and special treatment amongst certain regions, products, or customers that are out there. Both of these structures do prove to work but it is what is best for an organization.

Laquesha – respond with 150 words

Functional organizational structure A functional business structure groups the authority chain in occupational functional categories. For instance, administrative functions can be gathered together delineating it from other organizational activities like production and sales. In functional organizational structure each department has its management that responds to the top management.

AdvantagesFunctional organization structure Provides a clear line of communication and gives and directions on who to reports to who. It also plays a great role in improving efficiency and eliminating duplication and guesswork of efforts. This approach also provides a hierarchical structure easy for employees to know the promotional path.

DisadvantagesSince communication is mainly focused on a particular department, there are barriers that prevent interdepartmental interaction and communication. This approach also slows down innovation which may result to a decline in performance.

Divisional structureOn the contrary, divisional organizational structure subdivides the company in to smaller standalone units based on factors like product line and geography.

AdvantagesPersonnel from various departments’ work together increasing innovation and issues related to interdepartmental barriers are eliminated. Majority of the divisions work on the same level just like their counter parts thus, it is easy to obtain the right funding. Additionally, accountability is clear as every department operates independently thus, good, and bad results are identified.

DisadvantagesThe main problem associated with this structure is competition which results to companies speeding up a product to the market before it is fully made. Resource allocation is tedious as various companies do perform differently thus the problem of undermining may increase.

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Samantha – respond with 150 words

Disadvantages: the following disadvantages under SBU structure are revealed

• increase in salary expenses
• responsibility of VP (confusion about the role or function of group VP)

SBU structure is not supposed to overlook, although there are some disadvantages

Advantages: the following advantages under SBU structure are revealed

• meaningful planning and controlling
• unity in multi-divisional activities

Many big organizations had already adopted the SBU structure.

Advantages offset disadvantages:

• once the business grows more in size and managing divisions becomes more impossible
• once the company adopts this structure it should realize that advantage within a short period of time and then there should not be any meaning of disadvantages.

Odney – respond with 150 words

A general rule of thumb is whenever a company grows to the point of having ten segments/divisions, then an SBU structure may be best – but this rule of thumb depends on the size of the segments and how geographically dispersed the segments are located. The SBU structure groups similar divisions into SBUs and delegates authority and responsibility for each unit to a senior executive who reports directly to the chief executive officer. This change in structure can facilitate strategy implementation by improving coordination between similar divisions and channeling accountability to distinct business units. In a 100-division conglomerate, the divisions could perhaps be regrouped into 10 SBUs according to certain common characteristics, such as competing in the same industry, being located in the same area, or having the same customers.

Two disadvantages of an SBU structure are that it requires an additional layer of management, which increases salary expenses. Also, the role of the group vice president is often ambiguous. However, these limitations often do not outweigh the advantages of improved coordination and accountability. Another advantage of the SBU structure is that it makes the tasks of planning and control by the corporate office more manageable.