105386977 organization structure

7/30/2019 105386977 Organization Structure

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Re- engineering means recreating the organizations and

systems rather than making minor changes.

In a traditional organization logistics functions were

scattered throughout the organizations with no singledepartment responsible for it.

Traditional approach increases inefficiency and duplication

of work and thus it is now replaced by Integrated Logistics

Functions.

Integrated Logistics has many departments handling

specific functions which helps in reducing cost and

improving the quality.


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The competitive situations have compelled the organizationsto be responsive.

A responsive organizations puts the customers at the centreof the business and designs all its systems and procedures to

improve the speed of response and reliability of response.

An organization can be responsive and reliable by thefollowing :

1. From functions to process

2. From profits to performance.3. From products to customers.

4. From inventories to information.

5. From transaction to relationships.


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A matrix organization is one where functional leaders are

responsible for more than one area.

Employees report to both their immediate manager and a

cross function leader.

In matrix organizations, there is a solid line manager and a

dotted line manager.

The solid line manager is a functional manager and will not

change whereas the dotted line manager is a manager who

co-ordinates between different departments for a specific

project.


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Changing corporate culture.

Having a common vision.

Establishing employee ownership.

Training and educating employees.

Changing management processes.


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Strategic goal setting.

Resources.

Performance environments.

Communication processes.

Qualities of leadership and decision making.

Organizational adaption and innovation.


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CHIEF EXECUTIVE

COMMERCIAL

INVENTORY CONTROL

ORDER PROCESSING

FACILITIES PLANNING

MANUFACTURING

PURCHASING

RAW MATERIAL WAREHOUSING

FINISHED GOODS FACTORY

TRANSPORTATION

INDUSTRIAL ENGINEERING

PRODUCTION SCHEDULING

MARKETING

FORECASTING

CUSTOMERSALES ORDERINTERFACE

FINISHEDGOODS

WAREHOUSING


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Prior to 1950, logistical functions were not givenimportance.

Organizations underwent a series of changes post 1950

and logistics began to receive importance gradually.

These dispersed functions reported to separate functional

heads and no cross-functional link existed between them.

Commercial, manufacturing and marketing were the only

important functions to business.


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Re-organization started after 1950 which brought some of

the logistical functions together and grouped these but

were still reported to different heads.

As some of the functions were deleted from the functionalheads, they felt their importance was being depleted and

thus they resisted these moves.

This functional closeness started yielding performance

improvement and the organizations accepted the change.

This grouping resulted into stage 1 organizations.


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Material department dealt with inbound logistics and

reported to manufacturing department.

Marketing department dealt with customer service.

Traditional departments remained as they were


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A new function called physical distribution was createdwhich directly reported to the CEO of the company.

It had direct responsibility for outbound logistics.

Inbound logistics still remained with the materials

management.

Integration of logistical functions was now accepted.


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This integration was focused on the physical distribution or

the material management.

Logistics started contributing to the strategy of the

company as the head of physical distribution function.


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At the top most level of management hierarchy, single

authority for logistics was created around 1980.

The organization unified all logistical functions and

operations under a single senior manager.

Clear cut areas of responsibility and overall integration

facilitated by Logistics and inventory system.

This type of organization is rarely seen in practice.


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Horizontal organizations were formed where span of

control is very large.

Introduction of the concept of self-directed work teams

generated maximum performance.

Teams have clear goals and they try to achieve them

without depending upon the top management.

The rapid sharing of accurate information allowed the

integration of the organization.


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Electronically connected virtual organizations were

formed.

All logistical activities are transacted by relevant functions

of management with electronic support

Here, integration is in the form of informational support.

105386977 organization structure

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