Escolar Documentos
Profissional Documentos
Cultura Documentos
Start-Up Firms
Abstract
This paper discusses the importance and relationship between organizational structure and
business strategy. It examines if strategy comes before or after structure or they come together, as
individuals, partners or cooperate bodies start-up their firms or organization. I hypothesized that
strategy comes before structure but as a matter of importance they are complementary since one
cannot go without the other.
Introduction
Risk and uncertainties are major problems in the world of business where organizations
strive to get maximum profit and minimum loss simultaneously. In order to achieve that,
organizations implement strategies and build on structures which are guidelines towards achieving
such goals. This leads to the argument of which is more important structure or strategy.
There are different views on the importance and roles of organizational structure and
business strategy, (Mintzberg, 1990) offered a balanced view, arguing that the relationship
between strategy and structure is reciprocal. "Structure follows strategy ... as the left foot follows
the right." In this view the relationship between structure and strategy is complementary, one
cannot go without the other. (Hall & Saias, 1980) Inverted Chandler's thesis, suggesting that
Strategy Follows Structure. For example, they point out that a multidivisional structure biases a
firm towards a conglomerate strategy.
Conclusion
Strategy and structure are important elements for designing effective start-up firms.
Strategy is “planning” and structure is “framework”, therefore Organizational structure follows
Business strategy logically, since there has to be a plan for a structure to come into reality, a
structure cannot come into existence without a strategy to set the structure up and put it in place.
After a structure is in place strategy is needed for it to be fully functional, this is where strategy
and structure complement each other.
References
Chandler, A. D. (1962). Strategy and Structure. Chapters in the History of the
American Industrial Enterprise.
Hall, D. J., & Saias, M. A. (1980). Strategy Follows Structure. Strategic
Management Journal, 149-163.
Investopedia. (2017, July 23). Organizational Structure. Retrieved from
Investopedia: http://www.investopedia.com/terms/o/organizational-
structure.asp
Mintzberg, H. (1990). The Design School. Reconsidering the Basic Premises of
Strategic Management Strategic Management Journal, Vol 11 No 3, 171-
195.
Wikibooks. (2014, December 11). Business Strategy. Retrieved from Wikibooks:
https://en.wikibooks.org/w/index.php?title=Business_Strategy&oldid=27467
08