five organisational structures

functional structure product structure

• small size, single product line product focus
multiple products for separate
• undifferentiated market
customers
• scale or expertise within the short product development and life
function cycle
• long product development and minimum efficient scale for
life cycles functions or outsourcing
• common standards
• high scale

source: designing organizations, Jay Galbraith, Jossey Bass, 1995

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five organisational structures

market structure geographical structure

• important market segments low value items with high transport
cost
• product or service unique to
closeness to customer for delivery or
segment
support (relation based selling)
• buyer strength perception of the organisation as
• customer knowledge advantage local
• rapid customer service and geographical market segments
product cycles needed
• minimum efficient scale in low scale
functions and outsourcing

source: designing organizations, Jay Galbraith, Jossey Bass, 1995

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five organisational structures

process structure
• best seen as alternative to the
functional structure
• potential for new processes and
radical change to processes
• reduced working capital (lower
inventory and faster collection of
invoices)
• need for reducing process cycle
times

source: designing organizations, Jay Galbraith, Jossey Bass, 1995

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