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subordinates
are (to whom they can give instructions). Some 
people in an organization have colleagues who help them: for example, there might 
be an Assistant to the Marketing Manager. This is known as a staff position. Yet 
the activities of most companies are too complicated to be organized in a single 
hierarchy.
Today, most large manufacturing organizations have a functional 
structure, including (among others) production, finance, marketing, sales, and 
personnel or staff departments. This means, for example, that the production and 
marketing departments cannot take financial decisions without consulting the 
finance department. 
Functional organization is efficient, but there are two standard criticisms. 
Firstly, people are usually more concerned with the success of their department 
than that of the company, so there are permanent battles between, for example, 
finance and marketing, or marketing and production, which have incompatible 
goals. Secondly, separating functions is unlikely to encourage innovation. Yet for a 
large organization manufacturing a range of products, having a single production 
department is generally inefficient. Consequently, most large companies are 
decentralized
. An inherent problem of hierarchies is that people at lower levels 


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are unable to make important decisions, but have to pass on responsibility to their 
boss. One solution to this is matrix management, in which people report to more 
than one superior. 
A further possibility is to have wholly autonomous, temporary groups or teams 
that are responsible for an entire project, and are 
split up
as soon as it is 
successfully completed. Teams are often not very good for decision-making, and 
they run the risk of relational problems, unless they are small and have a lot of self-
discipline. In fact they still require a definite leader, on whom their success 
probably depends. 

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