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Organisational Structure of Allegheny Technologies

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Organisational Structure of Allegheny Technologies
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Organisational Structure of Allegheny Technologies - February 1st, 2011

Allegheny Technologies, Inc. NYSE: ATI is a specialty metals company headquartered in Pittsburgh, Pennsylvania in the United States. Allgheny Technologies is one of the largest and most diversified specialty metals producers in the world with revenue of $3.0 billion in 2009. ATI's key markets are aerospace and defense, oil & gas, chemical process industry, electrical energy, and medical. Products are titanium and titanium alloys, nickel-based alloys and superalloys, grain-oriented electrical steel, stainless and specialty steels, zirconium, hafnium, and niobium, tungsten materials, forgings and castings.

Patrick Hassey
Louis Thomas
John Turner
Brett Harvey
Michael Joyce
James Diggs
James Rohr
Diane Creel
Barbara Jeremiah
ATI Metalworking Products Bu...
Robert Wetherbee
Wah Chang & Exotic Alloys
John Sims
Human Resources, Legal & Com...
Jon Walton
Flat-Rolled Products & Ludlum
Terry Dunlap
Long Products & Allvac
Hunter Dalton
Primary Titanium
Lynn Davis
Engineered Products
David Hogan
President & COO
Richard Harshman
Dale Reid
Elliot Davis
Carl Moulton
Control & Accounting
Karl Schwartz
Rose Manley

Companies can be classified to their organizational structures. Another variable companies can be classified to is the nature of the projects undertaken. We characterize projects by the number of employees needed to perform the tasks, or workload, and the number of tasks that are fundamentally different in nature. An example of the latter aspect is PCB development and structural design.

Another way to classify organization structure is by one of the following four categories:

I. The product to be developed is comprehensible for one person. One person is likely to have all the knowledge needed to develop Manufacturing and Assembly. The development department in companies that undertake these kinds of projects are usually very small. If a company consists of more than one department, it is usually structured as a functional organization.

II. The product to be developed has a fairly low complexity, but total work is high. These kind of products are likely to be developed within one functional department. A research department may also be an example of a department in which type II projects are undertaken. Are more departments involved, then the light weighted matrix structure is preferable. Employees are involved on a full-time basis. Tasks may be performed concurrently. The sequence can be determined using the Design Structure Matrix.

III. The product to be developed consists of a lot of different elements, such as software, PCB, power supply and mechanical structure. The product is however in the engineering phase, i.e. it is clear what needs to be done to get the product into production. Various disciplines perform their own tasks. These tasks have mostly a low workload. Employees cannot work full-timee on one project. This creates a complex situation, that may be compared to a job shop situation in production logistics. Though the comparison between manufacturing and product development is not accepted by all product development managers, it may yield good results. Studying each step in the Product Development Process and fluctuations in workloads reveals ways to reduce variation and eliminate bottlenecks. It is necessary to view the Product Development Process as a process and not as a list of projects. Three important findings regarding this are:

1. Projects get done faster if the organization takes on fewer at a time.
2. Investments to relieve bottlenecks yield disproportionately large time-to-market benefits.
3. Eliminating unnecessary variation in workloads and work processes eliminates distractions and delays, thereby freeing up the organization to focus on the creative parts of the task.

Creating cross-functional concurrent engineering teams is the right way to develop products. However, the pitfall is too many project at the same time, so that key people from engineering, marketing and manufacturing work at five or more projects at once. This results in congestion. Striving to work at 100% of the product development capacity legthens product development lead times enormously. A more realistic percentage is 80%. Attention must be focused on bottlenecks, these days most commonly found at the software development side of the project.

IV. The product is complex. Total work is high. Employees can thus participate on a full-time basis. A project organization is the most appropriate organizational structure for these kind's of products.

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