Organizational StructureOrganizational Structure

Presented by: Team DAnn Blasius, Jolene Cabazos, Julie Comeau,

Ryan Scalmanini and Nora Trombley

MGT/330 Management: Theory, Practice & Application

Professor Darin Jones

December 1, 2008

As an organization that utilizes the matrix structure of management, communication is the key to success

At Boeing the lines of communication flow more freely with this structure and thus allows for increased accountability both from the project teams and project managers.

Boeing’s Organizational structureBoeing’s Organizational structure

• Boeing uses the Matrix Structure:

- Each Department has a Senior Vice President

o Business Development and Strategyo Communicationso Engineering, Operations & Technologyo Financeo Human Resources and Administrationo Internal Governanceo Internationalo Law Departmento Public Policy

Organizational structure cont.Organizational structure cont.

• Boeing uses Specialization:

- Different individuals in different units perform specific tasks

o Executive councilo Capital Corporationo Commercial Airplaneso Engineering, Operations, and Technologyo Integrated Defense Systemso Shared Services Group

Organizational structure cont.Organizational structure cont.• Boeing uses Corporate Governance:

• The firm is overseen by its executive staff and board of directors.The executive staffs and board of directors use integration to run the organization.

• Boeing’s use of integration, brings the Executive council, Capital Corporation, Commercial Airplanes, Engineering, Operations, and Technology, Integrated Defense Systems, and Shared Services Group together via the Senior Vice Presidents to make decisions about how to stay competitive and increase revenue.

Organizational structure cont.Organizational structure cont.

• Boeing’s span of control is wide:

-163,851 employees

- In 70 countries

• Boeing is a Centralized Organization:- high-level executives make most decisions and pass them down to lower levels for implementation.

Boeing’s Organization ChartBoeing’s Organization ChartW. James McNerney, Jr.

Chairman, President, and CEO

Michael J. Cave,Sr. Vice President

Business Development and Strategy

Tom Downey, Sr. Vice PresidentCommunications

J. Michael Luttig,Sr. Vice President & General Counsel

Shep Hill, President

Boeing International

Wanda Denson-LowSr. Vice PresidentInternal Goverence

Richard Stephens,Sr. Vice President

Human Resource & Administration

James Bell, Executive Vice PresidentChief Financial Officer

John Tracy,Sr. Vice President Engineering, Operations,

&Technology

Timothy Keating, Sr. Vice President

Public Policy

Vertical StructureVertical Structure

• Has hierarchy levels where top supervisors make decisions for organization

• Uses Differentiation - the organization is composed of many different units that work on different kinds of tasks, using different skills and work

methods.

• Uses Integration - the differentiated units are put back together so that work is coordinated into an overall product.

• Authority trickles down organization from top to bottom

• CEO and CFO and COO

• President and Vice President

• Department Heads

Horizontal StructureHorizontal Structure• Organization is subdivided or departmentalized into smaller units or

departments.

• Each Department has a Department head that oversees that division and all employees in the division.

• Lower level management reports to department head who reports to CEO, CFO, or COO.

• This structure works to create individual and specific divisions that oversee specific functions of the organization.

Analysis of Vertical and Horizontal Analysis of Vertical and Horizontal StructureStructure

• Vertical and Horizontal Structure often work synonymously.

• Vertical Structure establishes top supervisors who make decisions about how to run the organization.

• Horizontal Structure breaks down the organization into smaller divisions overseen by department head who report to top supervisors.

• Vertical Structure dictates how authority is delegated (top to bottom)

• Horizontal Structure dictates how each division is integrated into the organization.

Boeing’s Organizational FunctionsBoeing’s Organizational Functions

• Human Resources – develop and implement company growth activities.

• Marketing Department – leads strategic direction, revenue, market share and brand development.

• Operations Department – responsible for purchasing, quality control, logistics, evaluations, etc.

Boeing’s Senior Management Boeing’s Senior Management

Needs to:

• Support matrix structure and only implement where it adds value.

• Remove barriers - cultural and others.

• Supply clear direction.

Leadership and InnovationLeadership and Innovation

At Boeing each organizational function has it’s own purpose and place in the management of the company.

The company as a whole is ever striving to improve at all levels.

They realize that their strength comes from their employees, and that management at all levels must continue to support the many ongoing efforts by its teams.

Boeing’s CultureBoeing’s Culture

o Values

o Leadership

o Integrity

o Quality

o Customer Satisfaction

o Enhancing Share Holder Value

OrganizationalOrganizational Design Elements Design Elements

• Matrix Organization:o Geographico Functionalo Customer-Basedo Producto Serviceo Hybrido Matrixo Marketing channels o Departmentalization

Matrix StructureMatrix Structure• Boeing uses the Matrix structure to runs its

organization.

- Different divisions run independently due to the diversity of Boeing’s products.

- Boeing is an organization that has constant changes in technology, which means that collaboration amongst the divisions is essential for success.

- Boeing is a network organization with independent, single-function firms that collaborate on a good or service.

-Resource utilization is efficient because key resources are shared across several important programs or products at the same time.

Geographic'sGeographic's

• Based out of Chicago, Boeing has customers all over the world.– Boeing has sales offices throughout the world to cater to their

customers.

• Boeing’s span of control is wide:

- 163,851 employees

- In 70 countries

• This ensures customer satisfaction and proper communication between both parties.

ProductProduct

– Boeing’s products are very specific to each customer, especially in defense systems for governments.

– With a Matrix structure, Boeing is able to design and manufacture products that are one of a kind while still allocating resources very well.

ConclusionConclusion

We value the skills, strengths, and perspectives of our diverse team.

We will foster a participatory workplace that enables people to get involved in making decisions about their work that advance our common business objectives (Boeing, 2008).

References

Boeing, (2008). Boeing; About Us; Retrieved on November 29, 2008 from http://www.boeing.com/aboutus/culture/index.html#diver

Dumaine, B. (1994). THE TROUBLE WITH TEAMS. Fortune, 00158259, Vol. 130, Issue 5; Retrieved on November 28, 2008 from http://www.mph.ufl.edu/events/seminar/TroublewithTeams.pdf

Peters, T., Waterman, R. (2004) In Search of Excellence pg 307 p2.  Retrieved from http://books.google.com on November 29, 2008.

Almojuela, B. (2000). The Core of Planning Process. (1-5). http://www.alignent.com/resources/benalmojuela-qa.htm

Galligan, M. (1998) Policy/Management Track: Strategic Planning. (4) Kansas Legislative Research Development. http://www.ncsl.org/programs/lis/nalit/galligan1.htm

Bishop, L.A., (2001) Shaping the corporate ownership structure to build shareholder value.  Strategic Investor Relations 1.2 p 47(4) Retrieved on November 29, 2008 from General One File UOP.