The BYC Petroleum Products, a subsidiary of ABC Company, Inc., is a successful refining company. Its six refineries manufacture three main business products: fuels, petrochemicals, and lubricants. The products are sold to Denmark Industries (another ABC Subsidiary), chemical manufacturers, industrial plants, the auto industry, and a variety of other customers. The multi-billion company has a workforce of about 5400.

BYC Petroleum currently has a functional organization structure, with the following major positions reporting directly to the president: chief counsel; vice president for financial services; vice president for technology; director for planning and administration (to whom a general manager for planning and a general manager for human resources report), and vice president for operations (to whom a general manager for marketing and a general manager for manufacturing and supply distribution report).

Because of changing conditions in the markets for the company’s main products, BYC Petroleum is thinking about changing its organizational structure to a product structure design. In the process, the president is considering adding a senior vice president of resources and strategy to oversee the company’s strategic planning.

1. What does the company’s current organizational structure look? Draw the organization structure and describe the type of departmentation.
2. What would it look if the company adopts the departmentation by-product? Draw the organization structure.