Organizational Environment - Case Study Example

The link between innovation and the competitiveness of a business depends on the ability of the business to adapt strategically to the market it is in. Adaptation to a particular market is a dynamic process and can only be achieved as a long-term project and must consider other factors that may be external in nature and may also be affected by previous decisions on strategic positioning in the market. The ability to innovate is one key factor that dictates whether a business will be able to survive in the market and its performance.

Therefore, a business must be able to conceptualize an adaptation strategy by having the correct strategy, structure and internal alignment that will position it competitively in the market both through the internal and the external environment (Eunni, Post and Berger 2003). HKM can develop can develop a functional structure as its organizational structure as the company is set to grow into a larger company but is interested in the economies of scale through the production of large quantities of the products but at a lower cost.

This can be achieved by having highly efficient and specific divisions with specialized tasks, in this case the production of designs. Being dependent on the environment or the market to dictate the sale of the designs, HKM must adopt the open system in order to know what is going on in the business market especially concerning the customers, the suppliers and the competitors. The fact that the market seems stable for HKM in that he is assured of constant market for the designs; he can adopt a mechanist management system in the organization structure.

In this kind of arrangement, HKM will consider the specialized differentiation of the functional tasks facing the partnership and break them down. He will also have to distinguish the abstract nature of each task that may be pursued with techniques or purposes that are different from those of the business as well as reconcile each level in the hierarchy. This form of structure that applies to HKM must also determine the precise definition of the rights and obligations attached to each party and how they transit to responsibilities of a functional position (Burns and Stalker, 1961).

Harold and his partners must therefore be aware of the environment they operate in so as to survive as well as to know its domain or field of action. Daft (2010) states that this will be dependent on the products, services and the markets that the business is intending to serve as compared to its business objectives. Assuming that the product and the market that are to be produced by Harold and his new partners are perfectively competitive, the price is one of the most important factors that are to be considered.

The price should be set at the market level through the interaction of supply and demand in that all the organizational structures put in place must consider the demand and the supply of the targeted market. Further before increasing the quantities of the goods in the market, the firm must decide how much labor that will be required for the business that will ensure that there is maximization of the profits in line with the objectives of the business (Plantes and Finrock, 2009). Before increasing the quantities of production of the products, Harold must identify and evaluate the competition, their number, size, location, strengths and weaknesses and how the business can overcome the