Organizational Behavior and Management Design

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25. Why would Ford Motors want to shift to a matrix design organization for the design and development of cars and trucks? Ford had to look at their existing organizational structure and make some determinations. Organization structure is determined by several factors: size of the Firm, in this case a large global organization, the operations of the firm, information technology available, the environment in which it operates, and growth and survival strategy. Auto manufactures are highly specialized, competitive, and innovative organizations. They must be receptive to the needs of its customers and shareholders in order to survive. A functional organizational structure is not conducive to product design, development and implementation. Ford’s engineers need to utilize their knowledge to its highest capacity. Divisional departmentation in the matrix will enable them to acquire and share knowledge with other engineers globally. Ford 2000, a matrix departmentation was developed to be used worldwide. Engineers need greater access to more sophisticated information technology. This organizational structure would enable engineers to expand operations technology, specifically intensive technology. Engineers now have several supervisors they report to. Platform groups, independent self-organizing components of the organization, were set up to mesh together technologies and increase specialization. Ford’s decision to shift to a matrix organizational structure was to remain competitive and to be able to increase product development and implementation. Inventing new and innovative products, and continuing quality improvements accomplish this. Goals are to be receptive to customers and shareholders. The Ford 2000 matrix design was developed to facilitate product development, timely response, increase receptiveness to Ford’s customers and stockholders,

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