Question

What is meant by the statement "Structure must match Strategy"? Please give an example.

Answer 1

An organization’s strategy is its plan for the ways in which it can optimally utilize its resources. The organizational structure, on the other hand, is the way in which the internal components of the organization fit together. For an organization to accomplish its goals, the strategy and structure must be woven together in a seamless manner. The relation between organizational structure and strategy becomes clearer when the strategy is put in place. When an organization understands what it wants to achieve, then it can take the necessary steps to align its structure in a manner that can facilitate its approach. For example, if an organization has a strategy to become a top automobile manufacturer by targeting the high-end metros, then it can design its structure in such a way that it can create branches and allocate the required resources and manpower to effectively achieve this goal.