Organisation and Behaviour - Leadership Style in Goldman Sachs and Carrington Carr Group - Essay Example

Organisation & Behaviour Contents Contents 2 Introduction 4 Discussion 5 Task 5 Goldman Sachs and Carrington Carr Group: Comparison and contrast 5 Influence of each organization’s structure and culture on their business performances 7 Key factors which influence individual behaviour at work place 9 Task 2 11 Leadership style in Goldman Sachs and Carrington Carr Group 11 How organizational theory underpins the practice of management 13 Theories of Organization and approaches to management followed by Goldman Sachs and Carrington Carr group 14 Task 4 17 Explain the nature of groups and group behaviour within Goldman Sachs and Carrington Carr group 17 Factors that promote or restrain the development of effective teamwork in the companies 18 Evaluation of the impact of technology on team functioning within the two organization 19 Conclusion 21 Recommendations 22 References 23 Introduction The organizational behaviour is an important aspect of managing the business functions irrespective of size and spread of the business. The aspect of organizational behaviour deals with the code of conduct and the behaviour of individuals in the workplace due to the policy implementations of the management and leadership structure. The leadership styles and the motivational approaches adopted by the organizations also affect the organizational behaviour in the workplace. The key factors influencing the organizational behaviour of the organizations have been studied by taking into consideration a multinational company, namely Goldman Sachs and a domestic business based in UK, namely Carrington Carr Group. The ways in which organization behaviour have been able to influence the business performance of Goldman Sachs and Carrington Carr have been compared in this work. The leadership style and the motivational approaches followed in these companies have been studied to determine their impacts on the individual and group behaviour in the workplace. The role of technology in effective functioning of the business teams especially in case of wide spread business units have been studied in this work. Based on the comparative evaluation of the two organizations and the behaviour of their employees in the workplace, the key factors for influencing the organizational behaviour and long term value of the business has been recommended. Discussion The two organizations chosen for this discussion or organization and behaviour are Goldman Sachs and Carrington Carr Group. Carrington Carr Group is the domestic company that is based in UK while Goldman Sachs is the multinational company in the same industry that deals with the products of financial services, wealth management, investment and insurance. Task 1 Goldman Sachs and Carrington Carr Group: Comparison and contrast The organizational structure and the corporate culture of Goldman Sachs and Carrington car Group has been compared as follows. Organizational Structure Goldman Sachs is a leading investment bank that provides financial services in the form of investment management and wealth management services to its clients and includes a wide range of products including mutual funds, asset portfolio with a mix of debt, equity, insurance products, etc. Goldman Sachs is headquartered in US with its business spread across various countries all over the world offering investment services and advisory services in the areas of wealth management, protection, etc. The organizational structure of Goldman Sachs reveals that the US based investment banker and financial advisor is governed by a Board of Directors that is headed by their Chairman and Chief Executive Officer with as many as 13 members in the Board. The offices of Goldman Sachs are spread across all the continents which carry out the operations of the MNC based on the decisions taken by the senior management. The management and the Board of Directors in Goldman Sachs have undertaken the policy of effective governance that has led to the maintenance of strong oversight and has affixed accountability on the internal stakeholders. In comparison to Goldman Sachs, Carrington Carr Group is a privately owned group that is based in Leicester, UK and is into the business of sales and marketing of wealth management product and financial services to the customers. The company strives to fulfil the needs of their UK clients in choosing the appropriate products and services that would offer them financial protection as well as solutions for wealth maximization. Carrington Carr Group is headed by a Chief Executive Officer and comprises of Directors governing the operations of the company. Unlike Goldman Sachs, Carrington Carr Group does not have an extensive list of Board of Directors. Also in comparison to Goldman Sachs, there is no company secretary for Carrington Carr Group. The responsibilities of company secretary are managed by one of the Directors of the company. The CEO and the team of employees of Carrington Carr group have been able to engage into activities of acquisition and expansion of business in UK in an effective manner. The organizational structure of the group has been effectives in spread the business under various trading names. The organization structure include around 150 tele-calling agents and 400 consultants serving the needs of their UK clients by offering financial services on Home Finance, estate planning, mortgage advisory services, wealth management, protection and insurance, etc (Carrington Carr Group, 2014, p.1). Corporate culture The corporate culture of Goldman Sachs has been able to establish a healthy and sustainable business environment in the course of operations of the US based MNC. The culture of the organization is to recognize the human resource of the company as its most vital asset base. Goldman Sachs believes that the people of the organization are the best resources to deliver the effective solutions and advisory services to their clients which would help them to achieve their business goals in the international market. The company believes that investing for the cause of professional and personal growth of the employees would help them to increase their individual potential to understand the diverse needs of the clients, reinforce the objectives and goals of the organization, maintain a diversified workforce aimed at fuelling the growth of innovation and creativity in the business, etc. The corporate culture of Goldman Sachs leads to the attainment of sustainable business growth and creation of long term shareholder value (Goldman Sachs, 2014, p.1). A comparison with Goldman Sachs in terms of corporate culture revealed that Carrington Carr Group focuses on the career growth of their employees and cares for their people. The company believes that that an ethical culture and healthy work environment is crucial for the sustainability of the business. In the best interests of the organization, the company has set up a culture of encouraging their employees to work in a dynamic manner and actively participate in the organizational initiatives. The employees are nurtured and reinforced with the organizational culture from time to time. The high performing employees are rewarded and the company has been able to showcase a progressive career path with an aim of developing the quality of end-to-end financial services and solutions offered to their clients. Influence of each organization’s structure and culture on their business performances The organizational structure and culture of the multinational company as well as the domestic company have influenced their respective business performance over the years as explained below. Goldman Sachs Goldman Sachs started its business in 1869 and since then the US based MNC have come a long way with fluctuating business performance due to the economic fluctuation in various economies win which the company has been carrying out its operations. The structure of the organization headed by the CEO and the Board of Directors have been effective in the aspect of decision making in the context of providing financial products and advisory services, expansion and cost optimization in various markets. The organizational culture of treating the human resource of the company as the most crucial assets has been useful for the company in maximizing the wealth of the shareholders in the long term (Goold and Luchs, 1996, p.27). Due to nurturing and reinforcement of the organizational policies among the employees, the employees have been able to identify the needs of the customers under several economic conditions like stable economy, recession, inflation, etc. and then offer the financial services that are appropriate for the customers. This has led to the rise of business revenues and profits generation of the company in the long term. Carrington Carr Group Carrington Carr Group was founded in the year 1987 and embarked on the business of home finance and mortgage services. The company is privately owned and is controlled by limited number of Directors in comparison to Goldman Sachs. The company faced the situation of market crisis in the 1990s as the UK economic conditions tightened resulting the fall of real estate brokerage services. However, the planning capabilities of the Directors of the organization have helped them to withstand the crisis situation and further expand in the UK markets. Due to the strategic decision undertaken by the senior managements, the company has been able to undergo various acquisitions and take over in the later years. This has led to the expansion of the business under various trading name and diversified service offering in the area of financial protection and wealth maximization of the customer. The organizational culture of nurturing, reinforcing and promoting the employees who have dynamically contributed to the organizational objective have helped the company witness rise in the growth of its business in the last 25 years. Key factors which influence individual behaviour at work place The key factors which influenced the behaviour of individuals at the work place has been discussed and compared in the context of the operations of Goldman Sachs and Carrington Carr Group. Goldman Sachs has been governed by an efficient Board of Directors headed by the CEO which has a rich experience and knowledge in the international business management and operations. The operating units of the company have been given the power of decision making in context to the local business but the Board of Directors have played the role of sanctioning authority to approve such decisions in the best interest of the multinational business. The strong system of governance employed by Goldman Sachs has allowed the company to maintain effective oversight on the behaviour and work progress of the employees. The management has allocated accountabilities in accordance to the responsibilities delegated to the team members (Kozami, 2002, p.86). This has influenced compliant behaviour of the employees at work place that adhered to the objectives of innovation, creativity, customer service and increased sales revenues of Goldman Sachs. Goldman Sachs treated their employees as the most crucial asset in the business and nurtured and reinforced them from time to time. This has influenced the desired individual behaviour at workplace. The objective behaviour of the individuals led to better understanding of the financial and wealth management of the clients that result in the increasing sale of the financial products and services in the worldwide markets. In case of Carrington Carr Group, the privately owned company has been able to withstand the crisis of economic crunch and decline of estate management and brokerage services in the industry due to the appropriate planning of the directors governing the organization. The organizational structure headed by the CEO has put in place a workplace culture where they focused on promoting the career growth of the employees, nurturing and motivating them to meet the organizational objectives. This has influenced the individual behaviours in a positive manner in the work place to understand the needs of the customer in the condition of economic boom, recession, etc. Due to the healthy corporate culture in the workplace and the scope of career progression, the individuals exhibited dedication and commitment to their role of offering home finance and mortgage services in the market. Task 2 Leadership style in Goldman Sachs and Carrington Carr Group The leadership style followed in Goldman Sachs is democratic leader. In Goldman Sachs high emphasis is put on people and their performance. Goldman Sachs puts complete trust on their employees and believes that they are trustworthy, honest and have strong will to work hard in order to accomplish their challenging work and meaningful goals. The leaders of Goldman Sachs strive to make the work environment well organized and challenging with clear responsibilities and objectives. Goldman Sachs tries to get the job done by the employees through proper motivational technique and managing the individuals and groups so that they can give their full potential in reaching goals of the organization. At Goldman Sachs is based on many principles like teamwork, communication and tries to promote and drive a sense of partnership in the firm. The management makes sure that all the employees at every point of time understand what is going on in the organization. Here the leaders plans ahead and establishes clear objectives which are important for effective performance of the employees which are accomplished with heavy employee involvement. The managers at Goldman Sachs learn to lead by apprenticeships i.e. by working with their senior leaders. It helps in sharing the culture and ideals of the company on to other employees. The leaders treat the employees in right way and encourage them in right way. All the seniors work harder than new employees and set an example. The management of the company adopted flexible and decentralized structure which is used with clearly defined responsibilities. They promote an open participative work environment. The control is distributed among the employees and leader so that they can work effectively in an autonomous environment. The leaders of Goldman Sachs are decisive decision maker who puts emphasis on team decision making and at the same time makes critical decisions alone (Mehrotra, 2005, p. 195). The Communication within the organization is kept two ways, open and genuine. The managers of Goldman Sachs emphasize on employee, personal and ream development. The leaders of the company recognize good work and give reward accordingly. At the same time punishment is also awarded only as a last resort. The conflicts within the organization are openly confronted so that they don’t leave any bruises behind. The managers maintain a close and objective relationship with the employees. The manager delegates responsibility to the employees and holds the employees accountable for results. Goldman Sachs uses performance appraisal to let the employees known what is right and wrong. The leaders of Goldman Sachs are willing and able to get very deeply involved with their work. They have a board range of interests on different fields. In Goldman Sachs the most important element of leadership was the managers themselves and they build the program which suits them. Carrington Carr Group is one of the privately owned marketing and sales organizations. It sells home and building insurance, wills and probate, life insurance and unsold PPI and Mortgages. The leadership structure followed is autocratic leader. Here although high emphasis is put on performance there is low emphasis on people. Here the leaders assume that employees are irresponsible, lazy and untrustworthy. Here the organizing, planning, decision making and controlling are all accomplished by the leader itself with minimal involvement of the employees. The manger of Carrington Carr group basically relies on control, authority, manipulation, hard work and power to get the job done. In insurance field, the sales officers need to achieve the target and hence they are under constant pressure from their regional sales managers. They are constantly reminded of their targets and pressure is put everyday to accomplish their target. In case the sales officers are unable to achieve it, they are rebuked. Thus the sales officers are complete control of the regional marketing officers and used manipulation to get their job done. All the major important decisions like target to be achieved each month are decided by their leader without any consultations of the sales officers. It indicates that Carrington Carr group has a centralized and formal structure with carefully defined procedures and rules to be followed. In case of conflicts with seniors it is either resolved in favour of leader or is suppressed because it interferes with the work. The relationship between the sales officer and senior managers are kept strictly impersonal and formal (Lussier and Achua, 2012, p. 137). How organizational theory underpins the practice of management Management theory and Organizational theory are used in various aspects of business. Many individual strives to adhere to the theory so that it can help them get better at the jobs and make them more successful in life. But to achieve this they need to sacrifice some of the personal principles to succeed. One example is the financial sector where a manager or an employee is interested in understanding how to achieve their goals by following a set structure. Similarly an individual in Human Resources sector need to make decisions throughout the working hours which will have an impact on the structure and practice of a working day for the employees in the company. In case an employee focuses on fitting the mould of what according to them should their roles should be in terms of organizational theory then they will start neglecting other areas of business. Similarly, for some individuals the management theory can also underpin their personal values. For example the employees can disagree with specific set of rules and regulations introduced by the company, but due to their obligation and carrying out their job professionally and effectively it is important for them to move away from their principles and complete the job (Rao, 2001, p. 69). It is difficult to execute both organizational and management theories since a psychological contract between the employee and the employer should be maintained. It is important to consider how fairly the employee is treating the company and how fairly the company is treating the employee. Thus any significant changes in the management or organization of a company will undoubtedly have effect on all of this. Theories of Organization and approaches to management followed by Goldman Sachs and Carrington Carr group Goldman Sachs followed Systems approach of organization theory. According to systems approach an organization is composed of many components namely individual, formal and informal organization, patterns of behaviour, role perception and the physical environment. The individual refers to the employees of the organization. Here the employees are an integral part of the organization and the organization focuses of employee. Goldman Sachs is an informal organization where there is no specific set of rules which are followed by the organization and every leader tries to adopt their own way of doing work. The employees here the given full opportunity to work with and they count themselves among the ultra-elite group. Employees describe the organization as a consensus driven, flat and having collaborative culture. It is not being the smartest person which matters in the company but a combination of interesting, interested-in-the-world kind of and smart people brings success to the company. At Goldman Sachs teamwork is very vital. All the business units are made of teams from different divisions and thus are working across multiple offices. Within those teams everyone has its own areas of expertise but the overall responsibility for the entire project is shared. To make this work all the employees have to be able to work collaboratively and flexibly. Thus the organizational structure is flat where point of view of all the employees is valid even in case of newest intern and ideas can come from anywhere. The employees of Goldman Sachs are trained to live by 14 principles of the company (WetFeet, 2009, p. 31). They focus on reputation of the firm, high ethical standards, attention to client’s needs and teamwork. The company is obsessed with quality, devotion to the image and reputation of the firm with strong focus on teamwork. The company tries to diversify its workforce so that the effectiveness of the team improves. The company is famous for taking the work seriously so much that it some instances it has frowned on people by using the first person singular. The employees of Goldman Sachs take a lot of responsibility right from the start. There have been cases when the employees have moved ahead, much ahead than where they should have been but that is where the company need them to be. Goldman Sachs uses Herzberg and ERG theory of motivation. Goldman Sachs had adopted Motivating without Money. Thus they mainly try to give equal importance to hygiene and motivation factor. The company tries to ease the working conditions of the junior investment staff. They discourage them against working long hours and at weekends. It tries to change the culture by retaining younger employees. The company recognizes the importance of personal achievement for any employee and thus it tries to present a high growth rate in the career path. Also the employees receive public recognition for working in one of the best companies in the world. Thus Goldman Sachs tires to motivate the employee’s behaviour by satisfying both the hygiene factor and motivation factor (Baligh, 2006, p. 86). Carrington Carr group has bureaucratic organizational structure. The group has specific structural and procedural features which contribute to efficient and effective goal attainment. There is an element of impersonality within the organization. Here the culture is unhealthy as high performing individuals are given preference over others and this creates unhealthy competitive work environment. The organizational structure is hierarchical in nature and all the orders are given by the top management of the company. This leads to slow flow of communication. Thus team effort is not valued and individual contribution is given more preference. The main motivational factor is the incentives and rewards given to the employees in case they do good performance. Thus here Maslow Theory of Motivation is applied where after taking care of basic needs the company tries to fulfil the higher order needs in case the employee moves from one level to another. In many cases the employees are not able to rise above a particular level and fall in the lower level. Thus the motivating by money theory used by Carrington Carr group is not effective (Mukherjee, 2005, p. 211). Task 4 Explain the nature of groups and group behaviour within Goldman Sachs and Carrington Carr group Group dynamics refers to the way individuals and groups acts and react to changing circumstances. Within Goldman Sachs there exist formal group which is established by an organization so as to perform organizational work. The groups of Goldman Sachs considered as task group. For example the salespeople of the company organize themselves into teams. Goldman does not try to micromanage their teams. Individuals form their own teams and the teams are assigned responsibilities and tasks. The Teams within the organization function as little firms. Every team works independently in the way they run their business. Every team is responsible for drumming their own new business and keeps their focus on that particular job. The groups within the organization have to ability to cross command relationship. They are interconnected with other groups and departments working in other countries to solve the problems and achieve their objectives. The main focus of the group members are on the task at hand. They get usually dissolve after the objective is satisfied. The command duties of individual members of the group may be reduced temporarily in case the tasks require a great deal of effort and time. The members are usually specialized in particular field like managing the portfolio of companies, institutions or high-net worth individuals. Carrington Carr group follows command group within their system. The groups are specified in the organizational chart and here the employees have to report directly to the supervisor. In the organization the subordinates who are working have to follow the orders accordingly failing which will result in severe results for them. Such groups have no informal style between them and thus the members of the group follow the specified order of their senior. Here the employees are trained in such a way that they need to follow the orders of the seniors and they are not to question in general the orders of the seniors. Factors that promote or restrain the development of effective teamwork in the companies The teams within Goldman Sachs are highly task oriented. There are many ways of improving effectiveness in the organization. Diversity can help improve the team effort. With increase in diversity of talent, cultures and personalities the effectiveness of team will increase. Diversity will promote innovation and creativity and thus raise respect for and awareness of differences which will improve the effective teamwork. But if the same teams lack diversity it will be difficult to solve problems and much harder to find innovative solutions in case all the team members think about the same problems. An effective communication will help improve teamwork. Open and Clear communication within all the team members will make them be on same page with respect to responsibilities, targets and timelines. Effective communication increases the cohesion within the group. All the team members should be encouraged to ask questions regarding the jobs and responsibilities. The effective teamwork should be developed through practice and experiences. The team building activities should be given priority to increase the effectiveness of team. In such organizations it is possible that the team members may never come face to face with each other, hence it is important to do the team building exercise. Such kind of team building exercise will improve many important features of team performance like problem solving, creativity and communication. Drills and games are an effective way to bring the people together and boost the morale, build relationships and promote mutual understanding of personalities, interests, strengths and weaknesses. Carrington Carr Company has command group which follows the command of senior members. The command group can be improved by improving the leadership style. Through effective leadership style all the teams will benefit because of the direction and inspiration which they can provide. The leaders can support collaboration through effective coordination within the team members and encouraging them to speak their mind during team meetings. They will ensure that the team does the work and complete it on time. The leaders of the company will work towards disciplining and motivating the team members so that all the members can perform according to their highest potential. Hence in such organization it is important to have an effective leader who will improve the coordination among the team members. Evaluation of the impact of technology on team functioning within the two organization The impact of technology on the functioning of business teams could be explained well in the context of multinational companies like Goldman Sachs. Since the business of investment and financial services are spread across various markets all over the world, it is important to maintain a strong flow of organizational communication. The senior management should be able to communicate the policies and the modified strategies to the overseas management units for the best interest of the business. The organizational culture also demands sharing and collaboration of business expertise and knowledge, best practices among the employees of the organization. This has been achieved with the role of technology in establishing prompt communication in the work force. The various technologies that have been implemented in the organization include the customer relationship management applications, dedicated corporate electronic mails, corporate mobile connectivity, etc. These technologies have enabled the employees spread across various parts of the globe to know the status of particular product and service and the updated features implemented for offerings to the clients. The corporate emails are secured means of business communication where the teams could be aware of the past correspondences with the organization. The prompt connectivity of the corporate mobile connections helps to pass important instructions to the team. This helps the teams to function as per the instructions of the higher management for the best interest of the organization (Jenster,  Hayes and Smith, 2005, p.48). Conclusion The comparison of Goldman Sachs and Carrington Carr Group reveals the relative organizational structure and the corporate culture that has influenced the performance of the business of the two organizations. Goldman Sachs is a multinational company that has a long history of operations in the area if investment and financial services as compared to Carrington Carr group which has been offering financial services and advisory products to the domestic customers of UK for the last twenty five years. The comparison reveals that although there are differences in the organizational structure between Goldman Sachs and Carrington Carr Group, there are similarities in the corporate culture of the two organizations despite the fact that the size and scale of business is the same. Goldman Sachs is headed by their CEO and is governed by their Board of Directors. The Board of Directors has played a responsible for taking important decisions on the product and services, expansion and diversification of the investment and financial services. In the same industry but on a domestic scale of business, the privately owned Carrington Carr Group has been run by their CEO and limited number of Directors. Based on the decisions taken by the CEO, the company has undertaken the strategies of acquisition and merger, expansion of their business under different trading names, etc. However, both Goldman and Carrington which operates in the same industry of investment and financial services have establish a corporate where they have nurtured, motivated, reinforced their employees to fulfil the organizational goals. The leadership style of Goldman Sachs has been democratic in nature while the leadership style of Carrington Carr has been autocratic. The aspect of corporate governance, motivational strategies and good workplace culture has helped both the organizations to achieve growth in their respective business. Recommendations Based on the review of the organizational structure, corporate culture, leadership styles and motivational theories adopted by the multinational and the domestic companies, it could be recommended that all these factors are important consideration for the growth of business in the markets. The leadership structure needs to be design policies based on the objectives and goals of the business. The aspect of overseeing the organizational activities, corporate governance is important for monitoring the roles and responsibilities of the workforce in line with the instructions of the management. The work place culture plays an important role in developing ownership roles among the employees and fulfilment of their accountabilities. Like Goldman Sachs and Carrington Carr, the businesses which have treated their employees as the most important asset and motivate them are able to meet their business goals in the most convincing fashion. The role of technology could not be avoided in case of wide spread operations of the company where the business teams are required to be updated about communication from the senior management teams (Hill and Jones, 2009, p.46). The implementation of technological applications would help to develop a coherent behavioural pattern among individuals due to transparency in business communication in the workplace which would stimulate favourable group behaviour in the workplace. References Baligh, H.H. 2006. Organization Structures: Theory and Design, Analysis and Prescription. London: Springer. Carrington Carr Group. 2014. Company Mission Statement. [Online]. Available at: http://www.carringtoncarrholdings.com/index.html. [Accessed on 20 March, 2014]. Goldman Sachs. 2014. 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