As you may know, there are three main types of organizational structure: functional structure, Divisional structure and Matrix structure. Each structure has its own strong and weak points.
In the functional structure, the employees are working in departments based on what they are doing i.e. we have engineering department, maintenance department, faineance department, research department, Warehouse department, purchasing department. This structure enhances the experience of each function. For example, all the maintenance engineers are working in the same department and thus they will exchange knowledge and support each other. This structure saves us money because of the economies of scale. This structure makes the coordination between different department more difficult than other structures. It also doesn’t allow for flexibility because of the centralization.
Divisional structure divides, the employees based on the product/customer segment/geographical location. For example, each division is responsible for certain product and has its own resources such as finance, marketing, warehouse, maintenance, etc. Accordingly, this structures is a decentralized structure and thus allows for flexibility and quick response to environmental changes. It also enhances innovation and different strategies. On the other hand, this structure results in duplication of resources because, for ex., we need to have warehouse for each division. Obviously, it doesn’t support the exchange of knowledge between people working in the same profession because part of them are working in one division and the others are working in other divisions.
Matrix structure is combination of functional and divisional structure. For example, we can have a functional structure and then assign a manager for each product. Some employees will have two managers: functional manager and product manager. This type of structure tries to get the benefits of functional structure and also of divisional structure; however, it isn’t easy to implement because of the dual authority. This structure is very useful for multinational companies.
A modern organisation simply means an organisation that is practising business using today's theories or say current business theories and global organisation means an international organisation, it could be having branches in other countries or export to international markets, being managed in global prospective simply means it has to be looked after internationally wise, meaning all decisions made should be applicable to the international markets.