For example, sales and marketing could be two departments, particularly if the company has a large sales force or a large marketing department. The future outlook for the Asia Pacific Pharmaceutical Contract Development and Manufacturing Organization (CDMO) market appears promising, with several trends and factors expected to drive its growth in the coming years. In this fashion, the separate pieces of the process can be coordinated effectively and confusion can be reduced in the traditional process segments. Streamline management of your manufacturing business using our FREE Manufacturing Company Organizational Chart Template. A small business can use one of three primary organization structure options: functional, divisional or matrix. A fast-growing company in a new industry had for a number of years operated in a sellers market, where competition was based on quality and service rather than price. Its manufacturing organization was highly decentralized and adept at new product introduction and fast product mix changes. Policies that control the loading of the factory or factoriesraw material purchasing, inventory, and logistics policies. Study organization structure of two IT companies and prepare a report comprising . For, in a sense, the organization is the glue that keeps manufacturing priorities in place and welds the manufacturing function into a competitive weapon. Translating a set of manufacturing priorities into an appropriate collection of plant, people, and policies requires resources, time, and management perseverance. How are the appropriate corporate priorities to be maintained in a manufacturing organization that is characterized by a broad mix of products, specifications, process technologies, production volumes, skill levels, and customer demand patterns? A divisional organizational structure is comprised of multiple, smaller functional structures (i.e. For example, government regulations require us to have specific procedures to be compliant. These are in addition to the company's functional groups, which operate at a global level. The structure will differ from company to company, depending on the size, scope, and product type. Exhibit III Differences Between Product-Focused and Process-Focused Manufacturing Organizations. But the point is that divestiture could be accomplished readily, and this is the acid test of an effective and focused manufacturing organization. With such organizations, other aspects of manufacturing, particularly the production of the traditional product lines, need change only little as growth proceeds. Responsibilities throughout the plant and also throughout the upper management hierarchy are delineated, not by product line, but by segment of the full manufacturing process. If a company's culture is open and very lean, that would reflect in its structure, which would not be very tall, rather wide with cross-functional teams included. If purchasing becomes too fragmented because of decentralization, the company as a whole tends to lose economies of scale as well as clout with suppliers. To change the shape of an icon, locate the. Exhibit II Product-Focused and Process-Focused Organization. The production department's focus is naturally to get products out of the door quickly while keeping costs down (Note: this is true in at least 95% of manufacturing organizations, with the exceptions of the most mature companies. The management of such changes in the process is probably best accomplished by an organization that is focused on the process, willing to forsake the flexibilities of a more decentralized product focus. 3. Without such consistency, it does not matter how much effort a company puts into formulating and expounding on its strategyit essentially does not have one. To achieve organizational goals and objectives, individual work needs to be coordinated and managed. Continue adding employee entries until youve accounted for all employees at all levels. A process-focused factory supplying parts or materials to two distinct product groups would have the organization chart shown in Exhibit VI. Find a partner or join our award-winning program. Successful companies in cyclical industries like housing or furniture often exhibit this trait. Step by step, priorities and focus disappear, each lagging dimension being brought into line by some functions self-interest. Then he is confronted with pressure from finance to reduce costs or investment or both. The image above is an example of what . Manufacturing companies typically use traditional structures for organizing their resources. A product focus, however, is inherently easier to manage because of its small scale and single mindedness. Product-Based Divisional Structure. Decisions regarding organizational design also will be highly dependent on vertical integration decisions, as well as on the companys decisions regarding how various plants are located, specialized, and interrelated. Skinner has argued against this approach and for the other extreme in an article in which he advocates dividing up the total manufacturing job into a number of focused units, each of which is responsible for a limited set of activities and objectives: Each [manufacturing unit should have] its own facilities in which it can concentrate on its particular manufacturing task, using its own work-force management approaches, production control, organization structure, and so forth. Example 6: Manufacturing Company Organizational Chart. Once such attitudes and competitive priorities are identified, the task for manufacturing is to arrange its structure and management so as to mesh with and reinforce this strategy. If your positions and roles are well-defined and unchanging, a traditional top-down hierarchy may be best. Ideally, it is a master structure chart of the organization that identifies the key roles of every individual and maps . Some compete on the basis of superior qualityeither by providing higher quality in a standard product (for example, Mercedes-Benz) or by providing a product that has features or performance characteristics unavailable in competing products. Certain types of organizational structures are characterized by high flexibility; others encourage efficiency and tight control, and still others promote dependable promises. Look at the small business organizational chart below. Up to this point we have been arguing that a companys manufacturing function must structure and organize itself so as to conform to the companys priorities for certain competitive dimensions. Within a process-focused organization, individual plants are typically dedicated to a variety of different products. Such pressure generally implies changes in the production process itself: more specialization of equipment and tasks, an increasing ratio of capital to labor expenses, a more standard and rigid flow of the product through the process. This template provides a simple base hierarchy that you can build upon to create your own organizational chart. The organizational structure needs to ensure that responsibility is given to the right people without causing information bottlenecks, duplicating efforts or wasting resources. The best one for your small business can depend on a few scenarios: market span. Other companies, however, are so structured and managed that a certain rate of growth is required in order for the organization to function properly. For example, many companies that have had a strong central manufacturing organization find that as their sales and product offerings grow in size and complexity, the central staff simply cannot continue to perform the same functions as well as before. Make a list of names and who they report to. Just as individual plants must have a clear focus, so must a central manufacturing organization. It gives a clear line of authority to the employees and promotes camaraderie. Sales departments are often compartmentalized between inside and outside sales forces or between different types of clients, like having a separate manager and staff for key accounts. As a result, it is difficult to redirect them, and fine-tuning is almost impossible. Add design elements to personalize your chart, then share it with your organization. Project-based companies, like software companies and service companies, for example, would often benefit from these more-flexible types of structures. Perhaps they fall into this trap because of pride, or too little time, or because they are reluctant to say no to their superiors. Unless these trade-offs are made consistently over time, the company will slowly lose its competitive distinctiveness. The connection between manufacturing and corporate success is rarely seen as more than the achievement of high efficiency and low costs. That is, manufacturing confronts a very definite either/or choice of organizationeither product-focused or process-focused. Its manufacturing organization was essentially the same at the end of that period as before, dominated by a powerful vice president for manufacturing and a strong central staff, despite the fact that its product line had broadened considerably, that the company was beginning to make many more of the components it formerly purchased, and that the number of plants had both increased and spread into four countries. From this tab, you can change the shapes and colors of your employee entries. Configure and manage global controls and settings. The six types of organizational structures discussed here include functional, divisional, geographic, matrix, networked/team, and virtual. And management information systems must be designed to emphasize particular kinds of information at the expense of others. A process-focused factory producing for two distinct product groups would have the organization chart shown in Exhibit IV. Once your organizational chart has been created, dont let it languish. As we mentioned earlier, the great bulk of most companies assets (capital, human, and managerial) is found in manufacturing. Then customize your org chart easily. First Pillar:Global business units organize the company by its product lines, such as baby products, beauty products, fabric and home care, etc. The fact is that in most companies the great bulk of the assets usedthe capital invested, the people employed, and management timeare in the operations side of the business. Such a situation can be remedied either by dismembering and reorganizing this product organization or by decoupling it from the rest of the company so that it has more of an independent, subsidiary status, as described earlier. Get expert help to deliver end-to-end business solutions. 2. Product focus can also encroach on an avowed process focus. Our industry culture supports this structure as most of us operate using smaller workflows. Such a company could, of course, be a relatively independent division within a larger enterprise. Click on the top-most bubble (which is colored blue-gray by default) in the template and enter the name of the highest-ranking employee in your company, as well as their title. Continue down the line and add the names and titles of the employees who report directly to that person, and the names and titles of the people who report directly to them. Get answers to common questions or open up a support case. At the other extreme, one could simplify the job of each plant (or operating unit within a given plant), so that each concentrates on a more restricted set of activities (products, processes, volume levels, and so on), in which case the coordinating job of the central organization becomes much more difficult. Here the corporation is trying to serve two different markets and product lines from the same factory, whose process technology appears to meet the needs of both (it may, in fact, consist of a series of linked process stages operating under tight central control). The functional structure, shown in Exhibit 4.7, is among the earliest and most used organizational designs. number of employees. In fact, it is entirely possible that two divisions within a divisionally organized company would choose to organize their manufacturing groups differently. Some degree of responsibility and autonomy needs to be given to manufacturing operations, and other business units need to support those operations to keep the plant operating. First, organize the names and titles of the people in your organization. They develop multiple uses for their product or material and follow these uses into a variety of markets. This template is an example of a simple organizational chart for a small business. 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