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Exhibit 7.1: A Basic Functional Structure

Exhibit 7.1: A Basic Functional Structure

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The Basic Functional

Structure

•• Works

Works best

best when

when organization

organization has:

has:

•• Few

Few products

products

•• Few

Few locations

locations

Few

Few types

types ofof customers

customers

AAstable

stable environment

environment

Routine

Routine technology

technology



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The Basic Product and

Geographic Structures

•• Product

Product structure:

structure: departments

departments or

or subunits

subunits based

based on

on

different

different product

product groups

groups

•• Geographic

Geographic structure:

structure: departments

departments or

or subunits

subunits based

based

on

on geographic

geographic regions

regions



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The Basic Product and

Geographic Structures (cont.)

••

••



Usually

Usually less

less efficient

efficient than

than the

the functional

functional organization

organization

Allows

Allows aa company

company toto serve

serve customer

customer needs

needs that

that vary

vary

by

by region

region or

or product

product



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Exhibit 7.2: Product Structure



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Exhibit 7.3: A Basic

Geographic Structure



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The Basic Product and

Geographic Structures

•• Managers

Managers choose

choose product

product structures

structures when:

when:

•• Product

Product or

or an

an area

area sufficiently

sufficiently unique

unique toto require

require

focused

focused functional

functional efforts

efforts on

on one

one type

type ofof product

product or

or

service

service

•• Hybrid

Hybrid structure:

structure: mixes

mixes functional,

functional, geographic,

geographic, and

and

product

product units

units



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Exhibit 7.1: A Basic Functional Structure

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