Submitted by: Submitted by Winnieip
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Date Submitted: 05/15/2013 12:51 AM
3. How does XYZ foster innovation within the company? (what incentives in R&D department?)
An organizational structure affects a firm’s ability to innovate as it can determine
the level of decentralization and standardization.
Organizational Structure
Microsoft is currently adopting an organic organization structure with high degree of decentralization that the decision-making authority is given to lower levels of the firm.
Microsoft's five product groups are Windows & Live Windows Group, Server Software, Online Services, Microsoft Business and Entertainment and Devices. Each product groups focuses on a specific line of goods and services. And our targeted innovation, Xbox and Kinect, belongs to Entertainment and Devices division.
The organization was completely self-contained as each group has its own research and development, marketing, sales and customer service staff. Each product group has one executive in charge who reports directly to the company's president.
[1]The entire group is often in one location, allowing more interaction and better communication between all the employees developing or supporting one line of products. While having a smaller business unit, it means each division can develop new products and get them to market faster, making it easier to compete against rivals.
Although this type of organization is more expensive, it allows the groups to better serve their customers as it can facilitate a faster response to changes in external market.
Apart from the organic organizational structure, the corporate culture and job characteristic model adopted in in Research and Development contribute to the rapid growth of innovation in Microsoft.
[1] Richard L, Daft(2011) Management; 10th Edition, p296-297, 2p
Fostering innovation in labour force
As a proverb goes, " Labour is the most valuable asset.” Microsoft put lots of resourse on \developing their employees, especially in Research and Development Department.
The...