Environmental Uncertainty and Organizational Structure: a Product Management Perspective -Summary

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Environmental uncertainty and organizational structure: a product management perspective Article bySteven Lysonski, Michael Levas, Noel Lavenka
This Lysonski et al.’s article focuses on how an organizational structure may affect the product manager -level marketing. The article is about how a firm’s structural elements can affect the marketing effort at the product manager level. It asks if the firms take into account the uncertainty of the environment while planning their product-marketing organization structure. Nowadays organizational environment is changing rapidly, and in the future the changes will be even faster. Many marketing plans will fail because of this uncertainty. Marketing organization structure should be flexible enough to allow product manager to react quickly to market changes. When environmental uncertainty increases, the organization’s flexibility has to grow. Traditionally organization structures have been vertical, which structure is not as well equipped to changes than organizations with lateral power-sharing. So there needs to be made some changes according to organizational models (to replace the bureaucratic hierarchical organization models). When concerning a marketing plan in firms, the key agent is usually a product manager. He/she implements and controls a plan with a management system. But in the studies (studies from 1990s) it is noticed that only 52 % of the industrial firms were satisfied with their product management concept (72 % of consumer firms were satisfied). This much unsatisfaction may be a signal, that there has been big expectations for the product management systems (implementation, coordination, structure) that have not been reached. Also the work of product managers could have sometimes been considered as a disappointment.

Organization structure
The major dimensions in organization structure can be described with these three: degree of centralization of decision making, the formulation of rules and...
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