Application of Organizational Structure
Jim Johnson is the CEO of a major manufacturer of farming equipment. His company has been in business for the last 100 years and has been very profitable. The company is very formal and tall with formalized communication channels and rigid hierarchical relationships. Mr. Johnson makes all major decisions. This has worked very well until lately. It has begun to have some major global competition. Companies overseas are bringing new products into the United States at a lower price.
Furthermore, just yesterday, the new vice- president had mentioned that he felt that there was a major market overseas for the company's products. As its strategy was beginning to change, Mr. Johnson also realized its structure too would need to change, but to what? The company was large and, prior to these changes, the technology utilized, while extensive, had been very routine. What is he to do?
-The large size of the company and the use of routine technology are indicators that which type of structure would be most effective?
A)mechanistic organization
B)organic organization
C)matrix
D)strategic organization

Question

Quizplus · Accepted Answer

A mechanistic organization is typically characterized by a formal, hierarchical structure, which aligns with the company's current setup. Given the company's large size and routine technology, a mechanistic structure would be most effective in maintaining efficiency and control.