Mnging People in Retil - Assignment Example

Mnging people in retil The structure of retil firm refers to the wy in which its humn resources re orgnized nd entils the hierrchy, deprtmenttion, spn of control, nd integrtion mong the vrious units. The structure nd design of n orgniztion re the result of its externl environment, its size, its technology, its gols, nd its ledership. dditionlly, culture nd strtegy ply crucil role. Of prticulr interest in retil orgniztions is the link between structure nd strtegy, s the fit between them is essentil to orgniztionl performnce. s retil orgniztion, reporting reltionships chnge, spns of control re modified, nd deprtmentl functions re ltered. In most retil orgniztions, these chnges come in the fce of reltively little premerger plnning. lthough mny firms consider the implictions of structurl chnge on their orgniztion, often such nlysis is cursory nd superficil. This pper will introduce the elements of structure within the retil orgniztion, then explore the reltionship mong structure, strtegy, nd culture. Finlly, the structurl chnges within retil orgniztion strtegy is presented in the previous pssges of the pper. Retil orgniztionl structure hs numerous dimensions: formliztion, speciliztion, stndrdiztion, hierrchy of uthority, complexity, centrliztion, professionlism, nd personnel rtios. mong them, complexity, formliztion, nd centrliztion re focl to our discussion of retil orgniztion (see Figure 1). Figure 1. Dimensions for structure CENTRLIZTION STRUCTURE FORMLIZTION COMPLEXITY Complexity Complexity refers to the number nd vriety of hierrchicl lyers, job titles, nd divisions nd deprtments within n orgniztion. The more lyers nd divisions, the higher the complexity of n orgniztion. (Bddeleys, Jmes, 1990) It is needed to sy tht the level of complexity vries within the retil orgniztion. Within Tesco, the legl deprtment hs mny lyers of lwyers nd stff members servicing the legl needs of different regions of the country, wheres mnufcturing my hve only one loction with two hierrchicl levels. Formliztion Formliztion refers to the number nd content of rules nd regultions present within n retil orgniztion. The more written rules, stndrd operting procedures, nd policy mnuls, the more forml n orgniztion. The degree of formliztion determines how mny decisions re preprogrmmed, since rules nd mnuls cn replce mngeril decision mking. Highly formlized structures led to routine work nd ctivity. In forml orgniztions, behviors nd ctivities re predetermined since they re described in some document. Employee freedom in decision mking nd behvior is therefore highly limited. dditionlly, formliztion often leds to impersonlity for both employees nd customers Centrliztion The compny tht is being discussed hs decentrlized retil dministrtion. It is counted to be the cornerstone of orgniztionl policy tht is crucil when it comes to compny's retil success nd some difficulties to overcome every now nd then. The ltter my relte to the locl overpricing of goods, poor service, out-of-stock conditions, nd excessive nd unblnced inventories. t the mentime, compny officers ssume tht the dvntges of decentrliztion previl over its disdvntges. Centrliztion Centrliztion refers to the distribution of power nd decision mking within n orgniztion. The less the number of groups nd levels involved in decision mking, the more centrlized firm. In centrlized orgniztions, lrge mjority of ll decisions re mde by top mngers. In decentrlized orgniztions, on the other hnd, decisions re delegted or pushed down to lower levels. DETERMINNTS OF STRUCTURE There hs been considerble reserch regrding the fctors tht determine, nd re determined by, the structure nd design of n orgniztion. The fctors considered most often re size, technology, strtegy, externl environment, nd most recently, culture nd ledership. Evidence cn be found supporting the position tht these elements determine structure nd tht structure determines them. So there is circulr reltionship mong them. They ll mutully influence nd limit one nother. The structure of n orgniztion depends on its environment, technology, strtegy, nd so on. (Hndy, 1988) On the other hnd, once structure is in plce, it confines the options vilble in terms of technology, strtegy, nd mny of the other elements. I will focus on the elements of size, culture, ledership, nd strtegy, s they re most centrl to retil orgniztions. Orgniztion Structure of Tesco extends its customer centric philosophy to its orgniztion structure. The wy the compny is orgnized reflects its client thought cycle s they progress through their BPO inititive. Compny's reltionship mngers re consultnts nd industry people with strong consulttive skills to help clients evlute the off-shoring inititive. Product mngement drws from senior industry resources to drw up rod mp for n optiml long term off-shoring strtegy. Trnsition mngers combine strong consulting, opertions nd technology skills to ensure the smooth migrtion of processes. Operting tems re led by mngers with significnt experience in mnging opertions in our clients industry, supported by well educted, motivted nd innovtive process executives. The Chief Risk Officer ensures complince with pproprite control nd regultory environment to help mitigte customer risk. The orgniztion is supported by qulity consultnts, finnce nd dministrtion professionls, technology resources nd people mngement to ensure uniform, effective nd productive delivery. Uniform, except for those plesnt surprises. Size The lrger n orgniztion, the more likely it is to be complex nd forml. For exmple, lrge retil compnies re known for the presence of sizble number of rules nd mnuls governing ll spects of student ctivities. Retil compnies re lso highly complex, with vriety of deprtments nd divisions ll ttempting to serve the customers. Smller orgniztions cn function without the mny lyers of mngers nd multiple procedures nd, therefore, cn often be more personl nd responsive. (Johnson, 1998) Contrry to the reltionship of size nd formliztion nd complexity, lrger size usully forces decentrliztion. For exmple, lrge, geogrphiclly dispersed conglomerte will hve to decentrlize decision mking to some extent. Decisions regrding dy-to-dy ctivities hve to be mde within ech locl unit. Formlized procedures lso reduce the need for direct control. t the other end of the continuum, in smll, single-business orgniztion, top mngers re likely to mintin ctive control of most of the decisions. The structure of n orgniztion cn lso become fctor in llowing n orgniztion to grow. For exmple, n orgniztion with functionl structure my hve trouble mnging multiple products nd constituents. In order to llow for diversifiction of its products, which re likely to led to n increse in size, the structure hs to be chnged. dditionlly, if new products require considerble interction nd coopertion mong deprtments, the functionl structure is likely to be inpproprite. If the structure is not chnged, growth is likely to be stifled. Therefore, the structure ffects the size in the sme wy tht size originlly determined the structure. Culture Culture nd structure re inseprble, since structure is one of the mjor mnifesttions of culture. The culture of n orgniztion is one of the fctors tht determines the reltionship mong employees nd mngers. s with the other elements, however, the culture of n orgniztion my lso be the result of structure. For exmple, in highly centrlized orgniztion, the implementtion of prticiptive mngement nd employee empowerment will be impossible without chnge in the structure. Thus, the two elements re totlly intertwined. Culture within the retil orgniztion cn be referred to s culturl web which is useful tool when considering the culturl context for its business. Culture generlly tends to consist of lyers of vlues, beliefs nd tken for-grnted ctions nd wys of doing business within nd outside the compny. Therefore, the concept of culturl web is the representtion of these ctions tken for grnted for understnding how they connect nd influence the strtegy (Veliyth nd Fitzgerld, 2000; Johnson nd Scholes, 2003). It is lso useful to understnd nd chrcterise both the compny's culture nd the subcultures in dpttion of future strtegies. The retil compny hs very friendly nd supporting pproch in the routine wys tht stff t the compny behve towrds ech other, nd towrds those outside the compny tht cn mke up the wys people do things. The control systems nd mesurements re constntly under the mngement review to monitor the efficiency of the stff nd mngers' decisions. The rituls of the compny's life re the specil events, corporte gtherings, which he compny emphsises wht is prticulrly importnt nd reinforce the wy things re done. On-going meetings nd communiction t every level of the compny's hierrchy represent strong internl environment. Tesco's reltionship model combines process mturity with flexible, fst-pced smll compny culture tht mkes us esy to work with. The delight is enhnced by compny's bility to provide rmped-up vlue nd responsibility s the reltionship progresses. Tesco's people re inspired to be open, fir nd uncompromising in their efforts to ensure externl s well s internl customer stisfction. Compny pys specil ttention on Integrity becuse of the trust tht its clients plce upon it. Ethics, vlues, reputtion re vitl to Tesco's philosophy. Its objective is to be globlly respected s process mngement compny tht is truly viewed s strtegic extension of our clients' cpcity. Orgniztionl culture of Tesco lso implies people s core strength of the compny nd thus it is lid specil emphsis on hiring nd retining the people tht the compny believes will mke this orgniztion globl leder. Ledership Within the retil orgniztion, highly uthoritrin, control-oriented executive is likely to centrlize his or her orgniztion. The development of mny rules nd regultions nd mnuls lso reinforces control, nd so they re likely to be present. On the other hnd, prticiptive leder delegtes mny of the decisions nd my even be less likely to demnd the development of uniform hndbooks. Consequently, the style nd personlity of the leder re likely to be t lest prtly reflected in the structure of the orgniztion. It is importnt to note the reverse reltionship: The structure of firm is one of the fctors tht influences the choice of leder. n retil orgniztion tht is being discussed is very informl nd decentrlized is likely to consciously or unconsciously recruit nd select CEOs who hve similr philosophies. Tesco retil orgniztion (plese, refer to your chosen orgniztion here nd further in the text) hs leder whose style is known to mirror tht of compny's founder. The sme firm is highly unlikely to select hnds-off mnger unless mjor crisis occurs, requiring mjor shkeup. Strtegy There hs been much debte bout the direction of the reltionship between structure nd strtegy. In the 1920s, the common ssumption ws tht structure followed the development of strtegy. Strtegy ws devised nd led to the formtion of structure tht mtched. n often-used exmple is the cse of Generl Motors, which t the time devised the divisionl structure to support its new strtegy of competing product lines. In the cse of GM, structure followed strtegy. However, in the 1960s the position chnged. Mny compnies found tht their structure interfered with the implementtion of their strtegies. s result, strtegy ws sid to hve to follow structure rther thn the other wy round. In order for such lrge retil compny s Tesco to sustin its development it should follow either one of three generic strtegies, developed by Porter: the strtegy of ledership, strtegy of differentition, nd strtegy of focus. The strtegy of cost ledership indictes tht Tesco cn hve the lowest costs in the industry while offering the lowest prices. This strtegy is bsed on Tesco's bility to control its operting costs so well tht it is ble to price their products competitively nd be ble to generte high profit mrgins, thus hving significnt competitive dvntge. Strtegy of differentition tells tht it is needed to offer services nd products with unique fetures nd chrcteristics so tht customers differentited them from those of other retil shops'. The third nd lst strtegy of focus is either cost ledership or differentition strtegy imed towrd nrrow, focused mrket. In pursuing cost ledership strtegy Tesco focuses on the cretion of internl efficiencies tht will help them withstnd externl pressures. Therefore, it ppers resonble to think tht Tesco will hve frequent interctions with the governmentl/regultory nd supplier sectors of the environment. In ccordnce to this frmework, while both overll cost ledership nd differentition strtegies re imed t the brod mrket, Tesco my lso choose to confine their product to specific mrket res or my choose to offer smller line of products to the brod mrket, thus pursuing strtegy of focus or niche (Porter, 1980). In other words, Tesco pursues strtegy of cost ledership or differentition either in specific mrket or with specific products. Humn resource mngement Humn resource mngement t Tesco is multi-fceted process nd includes severl different elements: internl ssessment, job design, interviewing, evlution, selection, orienttion, trining, nd coching. The min interest within the compny is with the specific component of trining. Trining is importnt to the firm becuse it equips employees with the technicl nd interpersonl skills essentil for the orgniztion to generte its product nd service offerings. Trining seeks to provide vriety of competencies including remedil, technicl, nd interpersonl. Likewise, trining my be imprted through diverse rnge of delivery modes: mnul-bsed, in-house-triners, customized externl trining, nd generl courses offered independently of the orgniztion. Therefore, the first nd mny bottom line bout Tesco humn resource mngement is essentilly confirmtory, nmely tht: Employee trining is positively relted to firm performnce. Despite the importnce of the humn resource function, not ll enterprises pper eqully ble to relize the distinct dvntges resident within their personnel; more specificlly, smller firms pper disdvntged (Brown, Hmilton, & Medcoff, 1990). The rtionle for this occurrence is multi-fceted. Compred to their lrger counterprts, smll firms re chrcterized by resource pucity (Welsh & White, 1981) nd therefore hve less slck to devote to trining nd development. Given their smller size, ny trining inititives re typiclly less efficiently offered, both in terms of costs ssocited with filling vilble spots (Brrett, 1999) nd in tiloring trining content to firm-specific needs (Kirby, 1990). Complicting the mix even further is generl perception held by mny employees in smller orgniztions, nmely, tht their prospects for dvncement re better relized in lrger enterprises (Kruse, 1992; Morisette, 1993). When these ctul nd perceived impediments re considered longsi de smll firms' higher mortlity rtes, this finding, of trining being positively relted with firm size, is not overly surprising. This theoreticl overview is relevnt to the retil compny tht is being discussed. It cn be, therefore, concluded tht the second bottom line regrding Tesco humn resource mngement functions defines employee's trining s positively relted to firm size. ll in ll, the orgniztionl structure nd orgniztionl culture within the retil orgniztion tht hs been nlyzed in bove is tightly connected nd crete friendly nd t the mentime competitive environment within compny. The importnt function tht influence the sustinble development of Tesco is executed by humn resource deprtment tht is responsible for hiring qulified nd suitble employees who would mtch compny's requirements of successful member of tem. In cse the compny mngement decides to open few more stores, nmely two, the work of humn resource deprtment will be impcted s humn resource mngers will hve to hire more workers nd therefore to tech them to dpt to orgniztionl culture. The structure of the compny will probbly chnge s more lyers of mngement will be required nd higher level of supervision will be needed. In while, the chnge of n orgniztion tht took plce due to the opening of nother two stores , will be not noticeble s the chin of stores will become the prt of one whole system, culture nd structure. Bibliogrphy: 1. Bddeleys, Jmes, K. (1990). Firm resources nd sustined competitive dvntge. Journl of Mngement, 17(1), 99-120. 2. Brrett, J. (1999). The trining needs of smll firms. Humn Resource Mngement Journl, 2, 1-15. 3. Brown, C., Hmilton, J., & Medcoff, J. (1990). Employers lrge nd smll. Cmbridge, M: Hrvrd University Press. 4. Hndy, C (1988). Competing on resources: Strtegy in the 1990s. Hrvrd Business Review, 71(July-ugust), 118-128. 5. Johnson G. nd Scholes K. (2003) Exploring Corporte Strtegy, 6th ed.,Prentice Hill: London; 6. Johnson,G. (1998). Understnding the smll business sector. London: Routledge 7. Kirby, D. . (1990). Mngement eduction nd smll business development: n explortory study of smll firms in the UK. Journl of Smll Business Mngement, 28(4), 78-87. 8. Kruse, D. (1992). Supervision, working conditions nd the employer size-wge effect. Industril Reltions, 31, 229-249. 9. Morisette, R. (1993). Cndin jobs nd firm size: Do smll firms py less. Cndin Journl of Economics, 26, 159-174. 10. Porter M. (1980) How Competitive Forces Shpe Strtegy, The McKinsey Qurtely, Spring 1980, pp.34-50; 11. Veliyth R. nd Fitzgerld E. (2000) Firm Cpbilities, Business Strtegies, Customer Preferences, nd Hypercompetitive rens: The Sustinbility of Competitive dvntges with Implictions for Firm Competitiveness, Competitiveness Review, Vol. 10 Issue 1, pp.56-82; 12. Welsh, J. ., & White, J. F. (1981). smll business is not little big business. Hrvrd Business Review, 59(4), 18-32. Read More