HypotheticalBusiness: Online Hardware Distribution
HypotheticalBusiness: Online Hardware Distribution
Today,technology is among the fastest growing industries, especially thecommunications technology business. Popular trends in technologycompel people to discard their used hardware and purchase new andtrendy devices (Edgerton, 2009). For example, after the release ofthe latest iPhone, people discarded their old phones and rushed topurchase the new models. However, in other parts of the world, or inthe owner social classes, people are unable to afford the newreleases, and in most cases, they do not even have the old models.For this reason, the technology business is ideal because we canallow people to trade in their old phones and other gadgets such aslaptops and iPads and offer them new ones at a reduced price. In thisway, it is possible to procure the used device at a considerable lowprice and sell it as a refurbished product at a lower price than thenew devices or to sell the new products to the avid followers of thetrends in technology.
Differentstructures for the business are the functional structure, thedivisional structure and the matrix structure (Arbib & Rdi,2012). All have potential applications in the business, depending onthe chosen methods of operation and the objectives. In addition, thebusiness coverage is an important determinant of the organizationalstructure because different geographical areas need different modesof operation.
Thefunctional structure divides all elements of the business dependingon their functions (Dugdale & Lyne, 2010). Thecompartmentalization allows the business to meet specific objectivesin different departments. For example, in the hypothetical business,the different departments would include the exclusive sale of newproducts, the trade-in department and the department that sellsrefurbished second-hand gadgets. The differences would allow themanagement to select different strategies to suit the specificproducts and the specific objectives of the different departments. Inaddition, it would be necessary to have a shipping department wherethe geographical range of the business exceeds the ability of theclients to collect their products.
Thedivisional structure works the same way as the functional structure,but it involves large geographical coverage of the business (Dugdale& Lyne, 2010). In the divisional structure, the organization hasdifferent branches in different areas of the globe, and all thebranches serve specific objectives that are collectively gearedtowards the achievement of the larger objectives of the parentorganization (Dugdale & Lyne, 2010). For example, in thehypothetical business, it is possible that the local population willnot be interested in the refurbished products in the presence of thenew and more appealing products. Therefore, the main objective of thetrade-in service is to increase the volume of sale. The old productscreate a problem because their accumulation would inhibit efficiencyin the business model and result in stagnation or even regression ofthe business operations. Therefore, it would be good for the businessto sell the refurbished productions in other areas. For example, inthe middle class of the third world countries people are attracted totrending products but cannot afford them due to the skewed exchangerates (Green, 2008). Availing the products to them would reduce therisk of accumulating the products and thus create sustainability(Green, 2008). For this reason, it may be important to haveoperations in these nations to achieve the organizational objectivesof the business.
Thematrix structure is a hybrid of the functional and the divisionalstructure (Dugdale & Lyne, 2010). It integrates the elements ofboth models to achieve the objectives of a business organization. Inthe divisional model, where the business operations in the othergeographical area require to be divided into different departments,the matrix structure is ideal (Dugdale & Lyne, 2010). Therefore,if the business will need to sell the refurbished products as well asnew products in the new geographical areas, it will need to have adifferent branch in the other areas to sell the new products.However, it would be important to refrain from trade-in because thelocal business models would not be sustainable. While people in theUS may be willing to treat the old products are disposables, henceincreasing the profit margins for the new business, the same may notapply to the developing nations.
Thebest model is the matrix because there are no boundaries to what theorganization can achieve. It enables the new business to have a largescope of growth. In the initial stages of business operation, it ispossible to have ‘flat’ organizational model or theorganizational circle. In this model, it is possible to grow andadapt to the business objectives at different times and to becomemore hierarchical and structured with time.
Businessesare dependent on the nature of clients the business intends to serveand the predominant trends in the business world (Baligh, 2010).Therefore, it is important to balance between the objectives of thebusiness and the popular trends to have the best forms of operationin the business and to create sustainable operations. For thisreason, despite the selection of the eventual mode of operation andthe initial structure, it is likely that the business structures willchange in the future to accommodate changes.
Arbib,M., & Rdi, P. (2012). Neuralorganization structure, function, and dynamics.Cambridge, Mass.: MIT Press.
Baligh,H. (2010). Organizationstructures theory and design, analysis and prescription.New York: Springer.
Dugdale,D., & Lyne, S. (2010). Budgetingpractice and organizational structure.Oxford: CIMA Pub.
Edgerton,D. (2009). Theshock of the old: Technology and global history since 1900.Oxford: Oxford University Press.
Green,D. (2008). Frompoverty to power: How active citizens and effective states can changethe world.Oxford: Oxfam International.