Free Essay on Microsoft's Organization Structure

Published: 2019-10-15
Free Essay on Microsoft's Organization Structure
Type of paper:  Essay
Categories:  Company Management Business
Pages: 4
Wordcount: 944 words
8 min read

Founded in 1975, Microsoft has become the leading industry player in computer hardware and software development. Through the acquisition of other companies, the company has diversified its development portfolio to include the development of hardware and software exclusive to mobile phones. Since its inception, the organization has experienced some restructuring events as far as the internal management structure is concerned (Corporation, 2000).

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As of the January 2016, Microsoft had an overwhelming presence in over 80 countries and developed over 100 software and hardware products. The company is organized according to divisions based on functions and geographical locations. Units based on functions include but not limited to facilities, research and development, operations and communication, marketing, windows and devices, applications and services, and support. Each division operates semi-autonomously and is tasked with unique functions that relate to the companys goals, mission, and vision. For example, the windows and devices division is tasked with integrating Windows software into hardware such as the recently acquired Nokia devices. However, it has to work with other departments such as the research and development team who provide insight on how to produce the best hardware that will optimize the companys software (Wilhelm, 2016). Microsoft additionally has geographical divisions in the form of subsidiaries that include but not limited to Microsoft Asia, Microsoft Business Solutions ApS, Microsoft Manufacturing B.V., and Microsoft T-Holdings (Corporation, 2000). These units serve as local representatives of the central company, and their operations are dependent on the main company. Depending on their size, they are also divided into various functional divisions. This type of organization promotes better oversight of the business operations. Based on this, I would rate Microsoft to have a rating of 5 in utilizing the organic organization structure. Since it also uses a mechanistic organization structure in its specialized departments, I would also give it a rating of 5.

The authority in the organization is delegated to the respective heads of departments, but the Board of Directors make all the executive decisions and have the final say in critical matters (Stross, 1997). However, each department makes its decisions on internal matters and other subjects as long as they are in harmony with the boards directives (Wilhelm, 2016). Although the authority to manage tasks is not delegated, Microsoft encourages open engagement between field personnel and the corporate management with reasonable disregard for a protocol on sensitive issues. As far as decision making is concerned, I would give Microsoft a rating of 10.

Because of functional differentiation in each department, there is a fusion of individual and joint specialization. Employees in each department coordinate their tasks and work together. However, they are alienated, physically or otherwise, with staff in other departments who also specialize in other tasks due. Integrating the work from the companys various functions employs complex integrating mechanisms as teams and task forces may need to work together. For example, implementing certain software in a new hardware device might require that the devices team consult the development team so that the resulting product is fully compatible with any software that the development division creates in the foreseeable future. Only top management can switch between departments hence change in tasks while employees concentrate on specialized tasks. Consequently, tasks and roles in the company are relatively flexible but mostly very rigid, and I would rate the company with a 3 and 10 in role flexibility and rigidity respectively.

The company also extensively employs the use of mutual adjustment techniques in the management and control of its operations. That is, it favors face-to-face contact for coordination purposes as opposed to an emphasis on rules and standard operating procedures (Stross, 1997). This can be ascribed to the nature of its core business whereby software development requires a lot of coordination and interaction among programmers. However, owing to the size of the company and high employee number, most communication is written in the form of memos, emails, and other media utilizing written forms of communication. The informality can consequently be attributed to the size of the company as opposed to perceived brilliance. I would rate Microsoft as a ten as far as multidirectional communication is concerned.

The high presence of the company in many global destinations makes it very sensitive to the environment and market shifts (Stross, 1997). It adapts to the environment as required and consequently its sensitivity to external factors is open. As such, I give it a rating of 10.

Microsoft has adopted very well to its increasing growth by adopting a blend of mechanistic and organic structuring principles. For example, the authority is not highly centralized as is characteristic of organic organizations as the CEO does not have as much authority as is expected of typical organizations (Burns & Stalker, 2000). The authority is instead spread across an array of units that include the board of directors and department heads. However, the company is divided based on specialized functions as is characteristic of mechanistic organizations (Burns & Stalker, 2000).

Despite having nearly impeccable qualities in aspects such as communication, decision-making, and sensitivity to the environment I would recommend a change in the task and role aspect of the organization. Although rigidity in tasks improves output, it can compromise on overall productivity whereby employees cannot adopt to other tasks as needed or when the company needs to source employees from its existing workforce.


Burns, T., & Stalker, G. (2000). Mechanistic and organic systems of management. Technology, organizations and innovation: The early debates, 24-50.

Corporation, M. (2000). Inside Out: Microsoft-In Our Own Words. New York: Warner Business Books.

Stross, R. (1997). The Microsoft way. Reading, Mass.: Addison-Wesley Pub. Co.

Wilhelm, A. (2016). Microsoft Shakes Up Its Leadership And Internal Structure As Its Fiscal Year Comes To A Close. TechCrunch. Retrieved 16 July 2016, from

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