Can you please help me with a couple questions from this assignment? I have been researching and I just can't figure out how to answer them.

The instructor is referring to the company "Caterpillar" that designs and sells construction equipment.

These are the questions:

3) Summarize Caterpillar Inc.'s organizational structure. (refer to the source of Rothaermel 2019 for specific information.) (She is asking me to refer to a specific source and I have included the information needed to answer this question from that source below).

4) Determine whether caterpillar Inc.'s organizational structure is considered a traditional organizational structure or a holacracy? (No specific source is necessary for this answer)

Please help me! I am so lost!

THE TEXT BELOW IS THE INFORMATION THE ANSWER FOR #3 HAS TO COME FROM

ORGANIZATIONAL STRUCTURE

Some of the key decisions managers must make when designing effective organizations pertain to the firms organizational structure. That structure determines how the work efforts of individuals and teams are orchestrated and how resources are distributed. In particular, an organizational structure defines how jobs and tasks are divided and integrated, delineates the reporting relationships up and down the hierarchy, defines formal communication channels, and prescribes how individuals and teams coordinate their work efforts. The key building blocks of an organizational structure are:

• Specialization

• Formalization

• Centralization

• Hierarchy

SPECIALIZATION

Specialization describes the degree to which a task is divided into separate jobsthat is, the division of labor. Larger firms, such as Fortune 100 companies, tend to have a high degree of specialization; smaller entrepreneurial ventures tend to have a low degree of specialization. For example, an accountant for a large firm may specialize in only one area (e.g., internal audit), whereas an accountant in a small firm needs to be more of a generalist and take on many different things (e.g., internal auditing, plus payroll, accounts receivable, financial planning, and taxes). Specialization requires a trade-off between breadth and depth of knowledge. While a high degree of the division of labor increases productivity, it can also have unintended side-effects such as reduced employee job satisfaction due to repetition of tasks.

FORMALIZATION

Formalization captures the extent to which employee behavior is steered by explicit and codified rules and procedures. Formalized structures are characterized by detailed written rules and policies of what to do in specific situations. These are often codified in employee handbooks. McDonalds, for example, uses detailed standard operating procedures throughout the world to ensure consistent quality and service.

Formalization, therefore, is not necessarily negative; often it is necessary to achieve consistent and predictable results. Airlines, for instance, must rely on a high degree Page 385of formalization to instruct pilots on how to fly their airplanes to ensure safety and reliability. Yet a high degree of formalization can slow decision making, reduce creativity and innovation, and hinder customer service.¹⁵ Most customer service reps in call centers, for example, follow a detailed script. This is especially true when call centers are outsourced to overseas locations. Zappos deliberately avoided this approach when it made customer service its core competency.

CENTRALIZATION

Centralization refers to the degree to which decision making is concentrated at the top of the organization. Centralized decision making often correlates with slow response time and reduced customer satisfaction. In decentralized organizations such as Zappos, decisions are made and problems solved by empowered lower-level employees who are closer to the source of issues.

Different strategic management processes (discussed in Chapter 2) match with different degrees of centralization:

• Top-down strategic planning takes place in highly centralized organizations.

• Planned emergence is found in more decentralized organizations.

Whether centralization or decentralization is more effective depends on the specific situation. During the Gulf of Mexico oil spill in 2010, BPs response was slow and cumbersome because key decisions were initially made in its UK headquarters and not onsite. In this case, centralization reduced response time and led to a prolonged crisis. In contrast, the FBI and the CIA were faulted in the 9/11 Commission report for not being centralized enough.¹⁶ The report concluded that although each agency had different types of evidence that a terrorist strike in the United States was imminent, their decentralization made them unable to put together the pieces to prevent the 9/11 attacks.

HIERARCHY

Hierarchy determines the formal, position-based reporting lines and thus stipulates who reports to whom. Lets assume two firms of roughly equal size: Firm A and Firm B. If many levels of hierarchy exist between the frontline employee and the CEO in Firm A, it has a tall structure. In contrast, if there are few levels of hierarchy in Firm B, it has a flat structure.

The number of levels of hierarchy, in turn, determines the managers span of control how many employees directly report to a manager. In tall organizational structures (Firm A), the span of control is narrow. In flat structures (Firm B), the span of control is wide, meaning one manager supervises many employees. In recent years, firms have de-layered by reducing the headcount (often middle managers), making the organizations flatter and more nimble. This, however, puts more pressure on the remaining managers who have to supervise and monitor more direct reports due to an increased span of control.¹⁷ Recent research suggests that managers are most effective at an intermediate point where the span of control is not too narrow or too wide.¹⁸