A divisional form is an organizational structure that is segregated into different divisions where each division functions independently within its own boundary as the tasks are highly distinctive due to the variety each division entails in terms of the products and services it offers to the market. Independent divisional functions mean the divisions are decentralized from the top and autonomously make their decisions to day to day functioning of their own division, which signify that middle line plays the key role. However, standardization of output that specifies the performance works as the key control mechanism for the divisions to determine their performance assessed sporadically by the top management to ensure controllability, which gives an indication of machine bureaucracy (Mintzberg, 1981).
The autonomous power of divisional managers resulting from the decentralized authority from the headquarters requires them to obtain new skills, which can be gained through supplementary training (Ingham, 1992). Versloot et al. (2001) point out that divisional form entails diversified training programs due to diversified needs of different divisions. Itoh (2003) states that divisional structure is a source of significant motivation for its employees as the division itself is able to establish internal control, self operating procedure, and make own strategic decisions, which substantially improve the performance of the division. Conversely, Kagono et al. (1985 cited in Itoh, 2003) figure out that Centralized monitoring and controlling of performance of each division in terms of their output by the headquarters affect the reward system, which can be a major discouraging factor for the divisions.
A divisional form entails diversified training programs due to diversified needs of different divisions.
Multinational Organizational Structure
They are found operating in different country contexts according to their local business frameworks with little control from their parent companies that implies a decentralized authority structure (Inkpen and Ramaswamy, 2006). This indicates that the formulation of HR strategy and HR practices are minimally controlled by the headquarters (Edwards and Rees, 2006). For example, Rosenzweig and Nohria (1994) point out that HR practices (training, rewards etc.) of the subsidiaries of multinational organizations are different from those of their parents’ practices. Paauwe and Dewe (1995 in Shen and Edwards 2004) state that operating and middle level employees are basically hired from local resources whereas Collings et al. (2007) point out that top level management employees are recruited from the parent company due to their expertise and company experience.
Global Organizational Structure
Such structure focuses on standardizing output to achieve economies of scale in order to enjoy global efficacy (Bartlett and Ghoshal, 1998; Xu et al., 2006) and this is done through decentralized implementation of the major strategic decisions formulated in the parent company (Inkpen and Ramaswamy, 2006). This results in a reproduction parent company’s HR practices and policies to a certain degree (Edwards and Rees, 2006).
Transnational Organizational Structure
Transnational organization is defined as a blend of multinational and global organizational forms (Bartlett and Ghoshal, 1998), which seeks to achieve global efficacy through encompassing positive characteristics from these two organizations (Inkpen and Ramaswamy, 2006). Such organizational structures standardize their output and process to achieve success in global arena (Snell et al., 1998). They show the HR implications by stating that recruitment and selection (polycentric and geocentric), training and development (expand skill base, professional culture, continuous learning, negotiation and interpersonal skills), and reward and appraisals (local appraisal, appraisal base on others input, evaluation based on learning, frequent feedback) take a mixture of HR roles (p. 150).
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