Organisational Behaviour of Siemens and Dell Companies - Essay Example

Report Comparison Report between Siemens and Dell Companies Report Programme Word counts: Dead Line: Table of Contents Page No. 1.0 Introduction 4 1.1 Comparison of Organisational Structure and Culture between Siemens and Dell 4-9 1.2 Impact of Organisational Structure and Culture on Business Performance ofSiemens 10-11 1.3 Discuss Factors which Influence Individual Behaviour at Work11 2.0 Comparison of Leadership style between Siemens and Dell12-14 2.1 How Organisational Theory Underpins the Management Practice within Siemens? 14 2.2 Evaluation of the Main Approaches to Management Theory15 3.0 Impact of Different Leadership Styles on Motivation in Organisations in Periods of Change16 3.1 Comparison of Application of Different Motivation Theories within the Workplace16-17 3.2 Usefulness of Motivation Theories for Managers in Siemens18 4.0 Mechanisms for Developing Effective Teamwork within Siemens18-19 4.1 Factors that may Promote or Inhibit Development of Effective Teamwork in Siemens19-20 4.2 Evaluation of Impact of Technology on Team Functioning within Siemens 20 5.0 Conclusions and Recommendations21 6.0 References22-27 1.0 Introduction The purpose of this report is to present a comparison between two major companies, Siemens and Dell. Such comparison hopes to establish the position where each company stands in different important areas.Research claims that OB is the study of “the interface between human behaviour and the organisation, and of the organization itself” (Griffin & Moorhead 2013, p. 4). Organisational structure reflects the framework of management and delineates employee relationships “at different levels within the organisation” (Dransfield et al.2004, p. 71). Research has labelled organisational culture the glue which holds an organisational together and “addresses the lived experiences of people” (Alvesson 2013, p. 7). Siemens is a multinational conglomerate which originated in Germany and is headquartered there in Berlin. Being the largest company in entire Europe, it has always made strikingly innovative efforts to preserve its reputation over changing times. A wide range of quality products are offered by Siemens from medical imaging equipment to transportation products to generators to electrical services. Dell, in contrast, is primarily a computer manufacturing American company which is known for dealing in computers and laptops. Dell has a reputation for delivering quality to its customers by designing products in exact accordance with customer specification. There are different leadership styles seen at both Siemens and Dell which will be scrutinized in this report. 1.1 Comparison of Organisational Structure and Culture between Siemens and Dell Organisational structure is a formal system of task and relationships which controls how people in a workplace interact with each other to accomplish organisational objectives. In addition to shaping behaviour and different operations, it is also important to remember that organisational structure is dynamic and “evolves as organisation grows and differentiates” (Aquinas 2009, p. 8). Some important types of organisational structure are functional, divisional, and matrix. Functional Structure (BBC 2014) The above figure shows how a business is structured in a functional structure. Departments are set up to control different areas of activity. In this structure, an organisation is divided into different groups and each group has its own purpose. There are different types of departments like a marketing department, a designing department, a sales department etc. This type of structure is well suited to needs of smaller businesses where each department can function self-sufficiently. Divisional Structure (Chand 2014) Divisional structure is for larger organisations. Employees are grouped together in separate departments. As shown by the above figure, there is departmentation by function, product, geography, project, and combination approach. There is division of work based on functional activity like marketing, product activity, geographic activity, and project activity. In combination approach, two or three of the above departments can be merged together. Matrix Structure (Visitask 2014) Employees are grouped by function and product in a matrix structure. For example, there is a functional manager who is in charge of areas like quality control, production, resources, and marketing etc. On the other hand, product managers are responsible for products and smartly engineered product strategies. Matrix structure involves dual authority. Functional managers have the resources, while product managers are given “the budgets to purchase internal resources” (Chand 2014). Siemens has a matrix organisation structure which is the most complex of all. This structure merges functional and divisional structures, which suggests that Siemens is a hybrid of both structures. Benefits from both functional and divisional structures are enjoyed by Siemens. Research claims that Siemens will continue to “maintain its basic matrix structure for its global businesses and Regional Companies” (Siemens AG 2007). This is because of myriad advantages offered by a matrix structure. For example, there is fast monitoring, change is better tolerated, improved decision making, and efficient use of resources. Another annual research report by Siemens also reveals that this company is a proven matrix organisation that has stood the test of time. This matrix organisation consists of global businesses and Regional companies. Siemens reveals in the same annual report that within the matrix, the global businesses are given a right of way which means that they are given the freedom to “make decisions regarding the nature and location of our business activities worldwide” (Löscher 2007). In contrast to Siemens, the hierarchical structure of Dell company is functional (Hill & Jones 2009, p. 419).Such a structure works to improve strength within an organisation because there is something to learn for every member as decisions are made from various levels. As Dell transformed from a small company to a globally recognised household name, this functional structure was maintained. There are three levels of hierarchy in the company structure of Dell. The CEO sits at top of the Dell’s organisation structure chart. Second level of hierarchy is occupied by departments and their managers, while workers are in the lower hierarchy level. Research claims that Michael Dell had to decide early on “how to design his managerial hierarchy to best motivate and coordinate managers’ activities” (Jones 2008, p. 12). Workers take orders from the top and are not much involved in decision making which contrasts Dell from Siemens. Siemens has a better organisation structure than Dell because employees are also involved in important decision making processes. Organisational culture is regarded by research to be “a very stable datum” (Schabracq 2009,p. 22). Before comparing Siemens’s culture to Dell’s culture, it is important to mention that what is deemed good in one culture might even be considered disastrous in another workplace culture (Goman 2013). Following is brief description of some major types of organizational culture according to Cameron and Quinn perspective on organisational culture.Cameron and Quinn are recognized as organisational culture experts. They have introduced four types of workplace culture (Loughran 2007, p. 45). First there is the clan culture where employers and employees relate to each other like members of a clan. In the adhocracy culture, leaders set inspiring examples of innovation for employees. In the market culture, there is an element of fierce competitiveness and leaders are very exacting in that they constantly push their employees to work harder. Finally, there is the hierarchy culture which is recognized for hosting a highly structured workplace where superiors heavily coordinate with workers. Research stresses that it is important for leaders to have skills “represented by their organisation’s dominant culture” (Cameron 2006, p. 122). Investigation into Siemens reveals that the company has a market culture. Research also claims that “Siemens creates a market organizational culture by striving for a high-performance workplace” (Hanover Research 2010). This proves that a market culture is used by Siemens to create a demanding and competitive workplace atmosphere. Because such a culture focuses on improving team performance, so “overall results improve as well” (Hanover Research 2010). Siemens is a very good example of an organisation that has adopted a market culture and has derived huge benefits out of this consequently. There is a performance-driven culture because employees who show good performance are awarded clear incentives in the form of bonuses etc. Research has it that incentives form a strong psychological force which decisively impacts a worker’s behaviour, work quality, and persistence level (Waddell, Jones & George 2011, p. 4). Dell’s organisational culture is hierarchy culture in contrast to Siemens’s market culture. Research has it that there is an internal focus in hierarchy culture which leads to formation of a more well-structured and formalised work atmosphere. Reliable products and services have been delivered by Dell over time because the company is based on core values of hierarchy culture. Dell is considered a very good example of a company with hierarchical culture becausegenerous investments are made in the area of “efficiency and cost-cutting in order to compete” (Kinicki 2009, p. 44).Dell contrasts from Siemens on the level of organisational culture just like it differs on the level of organisational structure. This is because Dell uses hierarchical culture which has an internal focus, while Siemens has adopted a market culture which has an external focus. 1.2 Impact of Organisational Structure and Culture on Business Performance of Siemens It is critically vital to acutely understand myriad impacts of organisational structure and culture on business performance of an organisation. Such knowledge can help to gain a competitive edge over rival organisations. Siemens has always made use of good teamwork philosophy to acquire stability and control because such is the objective of a matrix structure and a market culture. However, one of the negative impacts of a market culture which is promoted by Siemens is that it creates a fiercely competitive and aggressive work environment which is dubbed by research as almost “militaristic” (Kinicki 2009, p. 44). Strong cultures are very important to ensure values are shared and employees are motivated to deliver value. Weak or bad cultures are characterized by strong management groups struggling for superiority over less powerful groups. There are no clear values due to which workers here are not enthused to pursue shared goals for betterment of their organisation (Oliver 2004, p. 210). There is also a dangerously low level of organisational and work commitment. In contrast, great leaders of companies like Siemens and Dell use strong cultures to keep people focused on working as a team to lead the organization towards its ideal future. Research has it that members of such effective teams consider it critically important “to spend most of their time discussing work issues” (Cardon 2014, p. 67). This is the state of organisations based on high-performance cultures. The influence of Siemens’s organisational culture on organisational performance and staff motivation is of huge importance and much has been written about it.For example, one important influence is that workers at Siemens are often rewarded based on their ability “to meet productivity as well as performance targets” (Rao 2007, p. 408). Research also claims that in order to successfully manage people, scrutinizing individual characteristics which influence how they behave at work is worth giving a shot (Carpenter, Bauer &Erdogan 2010, p. 34).It is an undeniable reality that a motivated and satisfied workforce is a critical asset for any organisation (Chen 2010, p. 66). Siemens is a well-reputed and widely popular example of culture management done right because this large business organisation has made significant contributions to making employees feel included and valued at the workplace (Hodgetts&Hegar 2007, pp. 538-539). 1.3 Discuss Factors which Influence Individual Behaviour at Work Personality and social perception are very important factors which influence individual behaviour at work. Social perception is essential to be able to behave appropriately at work. Research also claims that “employees’ perception that their firm has an ethical culture leads to performance enhancing outcomes” (Ferrell &Fraedrich 2010, p. 19). Dispositional theory of job satisfaction is worth mentioning here. This is because this theory lays immense emphasis on personality and establishes relationship between nature of personality and performance or behaviour at work. This theory operates on the belief that regardless of external factors, it is actually an employee’s inner emotional dispositions that decide how satisfied he/she will be with a job. According to Saari and Judge (2004, p. 395), the most important work attitude or behaviour is job satisfaction. This explains why most contemporary researches focus on ‘the dispositional bases of job satisfaction’ (Buchanan &Bryman 2009, p. 206) to scrutinise how they are related to indivual behaviour at work. Now, Siemens’s leaders have used this concept of job satisfaction abundantly by taking only those people to fill vacancies who have friendly and passionate personalities. They also use an occupational personality questionnaire to select socially perceptive and ambitious employees (Siemens Annual Report 2009). 2.1 Comparison of Leadership style between Siemens and Dell Research defines leadership as an intricate social process which is embedded in “the values, skills, knowledge, and ways of thinking of both leaders and followers” (Gallos 2008, p. 1). Management is described in literature as a concept which is not about supervision alone, rather it is really about “turning complexity and specialisation into performance” (Magretta 2012). This suggests that what contrasts leadership from management is the element of supervision. Leadership style should be such that changes could be easily introduced in organisational culture when needed. Siemens has a transformational leadership style because leaders here acknowledge the solid relationship between transformational leadership and organizational effectiveness. They have preserved their organization’s dominance by “motivating their followers to accept new goals” (Hodgetts&Hegar 2007, p. 354). Research proves that Dell also uses transformational leadership style. It is claimed that because of a hands-on leading style, “Michael Dell leadership style is a transformational one” (Advise America 2014). As mentioned already, research implies that “organisational culture is a very stable datum which is hard to change at will” (Schabracq 2009, p. 22). Culture shock is almost inevitable when people used to one way of living are exposed to a different culture at a workplace (Sibanda 2011, p. 37). Most attempts to bring a change in a company’s culture are wasted efforts (Vilet 2013). This is because culture is a very adamant force and manoeuvring it requires sheer talent. It is interestingly suggested by Burdett (1999, p. 7) that people do not actually resist change, they only tend to reject things which fail to meet their standards about which they feel passionate. The Cohen-Bradford Influence Model is worth mentioning here in reference to how change can be introduced in organisational culture. The bedrock of this model is formed by this belief that “all of the positive and negative things we do for (or to) others will be paid back over time” (Mind Tools 2013). As stressed by this model, every resistant person can be transformed into a potential ally if the person trying to influence is willing to invest time and work in this area (Cohen & Bradford 2011). Bureaucratic leadership style is characterized by the formalization of procedures which are dry and emotionless (Manetje ‎2009, p. 21). Benevolent or participative leaders are those who do not stonewall and are also emotionally intelligent (EI). There are many leaders who do not like to participate and want to avoid confrontation as much as possible. They prefer to find escape in difficult times instead of addressing the problem at hand. This attitude stands in contrast to participative leadership style and smothers teamwork spirit. Research also shows that EI and good teamwork are inextricably linked to one another (Gujral&Ahuja, 2011, p. 178). EI helps to transform a loose group into an effective team.According to Burns, whenever leaders or managers are able to inspire their followers, subordinates, or employees to change their views and leave their individual interests for the mutual benefit of the organization they work for, transformational leadership can be witnessed (Bass &Riggio 2006, p. 100). In similarity with Siemens, Dell has also a transformationalleadership style. This style is built on collaboration. Organisational culture is phenomenally affected by transformational leadership model. This is because organisational culture is put at risk when employees are not driven towards common goals and there is no sense of direction either.Failure to anticipate alliance and writing off the other person who is tried to be influenced prematurely leads to confrontational reactions which should be avoided.The effectiveness of transformational leadership is that both Siemens and Dell leaders are benevolent and EI as they care to collaborate with their employees as much as possible. According to a research report, it is admitted by Michael Dell that “his leadership style is built on collaboration” (Woodward 2009). The efficacy of this leadership style can be assessed from the impact produced on workers. Though Dell believes in hands-on leadership, he still does not come across as an authoritative leader. He does not impose decisions on people because research reports have consistently described Dell“as one of the best places to work” (Advise America 2014). Similarly, at Siemens, leaders strive to preserve the sanctity of workplace culture by careful implementation of transformational leadership model. 2.2 How Organisational Theory Underpins the Management Practice within Siemens? Both companies, Siemens and Dell, differ in their OB which is a subject that has extreme importance in all the organisational setups. This is because it focuses on individual behaviours of members of an organization and analyses how each of them perceives the concept of organisational culture. Research suggests that human relations theory is the main approach taken to management and OB by Siemens. This is because employees are not only motivated by way of incentives like cash rewards, but they are also rewarded by inculcating in them a sense of belonging. A sense of belonging develops when employees are told by President and CEO of Siemens AG to “always act as if it were your own company” (Kaeser 2014). Such thorough encouragement of employees is exactly what is professed by human relations approach also. In contrast to Siemens, contingency approach is the main approach taken to management and OB by Dell. Research has it that this is a situational approach which implies that there is no single standard model of leadership, but it varies according to the nature of situation, task, or objective which is required to be completed. Dell’s management style has also evolved over time from autocratic in earlier days of the company to participative in later years (Woodward). The way Michael Dell has used different styles to lead people in different times proves that Dell uses a situational approach. 2.3 Evaluation of Main Approaches to Management Theory One of the most important strengths of human relations approach is that it stresses that an organisation is not a mechanical system, rather it is a cooperative system which heavily depends on a team of cooperative leaders and employees. It also stresses that employees should be made an asset to the company in order to motivate them to deliver quality service. For this purpose, they should be motivated by both monetary benefits and psychological relief. Criticism should always be constructive to help a worker feel relaxed at work. However, human relations approach also has its share of criticism. It is claimed that because this approach concentrates on employees’ motives, it does not hold the potential to affect organisational management or order. It lacks perspective and is “manipulative in its assumptions about the relationship between worker attitudes and productivity” (Barnett). Situational leadership or contingency approach is good in that it has the potential to significantly affect organizational effectiveness over changing times. This is because instead of sticking to one leadership style, situational leaders like Dell keep modifying their strategies depending on the situation they are faced with. A minor disadvantage of situational management is that it can shock some employees who are used to one style of management. They can resist change which creates problems. But, Mr. Dell has managed with this possible scenario within Dell by delegating responsibility and a sense of ownership to other team members also. Research has it that Mr. Dell “did a very good job of delegating decisions and responsibility to his executive team” (Woodward). When rest of the team members also feel like they own the company in addition to the head, they are bound to overcome conflicts and deliver the best. 3.1 Impact of Different Leadership Styles on Motivation in Organisations in Periods of Change Dictatorial and bureaucratic leadership styles have bad impact on staff motivation in period of change. In order to save organisational culture from chaotic conflicts and disputes, collaboration and negotiation can prove to be very useful. This is because it helps to reach solutions without causing any significant damage like dictatorial style can. Collaboration strongly depends on principled negotiation to reach an agreement. It is recognized by collaborative leadership that a conflict should not be suppressed because it is more perfectly controlled through peaceful negotiation with the help of mediators (Dillon 2009, p. 218).Bureaucratic or dictatorial leadership contributes to formation of power culture which is witnessed when strong groups having more power, authority, or fame struggle to maintain their superiority over weaker groups.In constructive cultures like those of Siemens and Dell, democratic leaders coordinate or collaborate with employees to help them fulfil tasks in a quality and cost-effective manner. This increases the level of employee motivation and job satisfaction. On the other hand, authoritarian leaders develop aggressive-defensive cultures which as the name implies depends on the use of coercive prods by employers to force employees to fulfil tasks (Cheng 2006, p. 59). This negatively impacts the rate of staff motivation in an organization. 3.2 Comparison of Application of Different Motivational Theories within the Workplace Herzberg’s motivation-hygiene theory Herzberg’s theory digs with acute intelligence into differentiating factors which cause job satisfaction from factors causing dissatisfaction for the workers in an organisation. According to his two-factor theory, employees are satisfied by motivation factors such as achievement, recognition or reward, interest in the job etc and dissatisfied by hygiene factors such as working condition, quality of supervision, salary, status, security etc. (Value Based Management.net 2013). This suggests that in contrast to personality theory already discussed, Herzberg stresses that different external factors can be responsible for driving satisfaction and dissatisfaction at a workplace. Vroom’s expectancy motivation model This approach maintains that employees can be motivated if they are educated about the importance of roles they can play in the process of achieving something important (Chiang 2006, p. 188). Employees are more compelled to work strenuously if they know that “their efforts will be reflected in high performance” (Kumar & Sharma 2000, p. 492). They cannot commit themselves to the rules of organisational structure and culture until they understand how their work will affect their organisation (Green &Butkus 1999, p. 182). Employee surveys should be conducted every other year to educate workers about their roles and assess how well they understand the company’s mission (Schneier 1995, p. 70). This is important for smart implementation of Vroom’s unique motivation approach. Equity theory and job satisfaction This concept explicates that job dissatisfaction is made emphatic by discriminatory attitudes at work, which objectionably make one employee more advantaged than another (Hersen 2004, p. 475). The workplace environment will not be distressed when two employees doing the same job are awarded in a matching manner, but there will be noticeable distress when one of the two gets promoted or receives some monetary benefit. An organisation should be equity-sensitive believing all should be treated on equal basis, regardless of gender, colour, race etc. to sustain a high rate of job satisfaction and positive work attitudes. 3.3 Usefulness of Motivation Theories for Managers in Siemens Motivation theories offer great value to managers of both Siemens and Dell regardless of the fact that both organisations have different frameworks. All members working on different levels are involved in decision making at Siemens, while at Dell, the CEO enjoys most authority. But, that also means that the CEO is most responsible for managing the company. The CEO cannot be present everywhere at the same time. So, some of the authority is delegated to managers who then look over employees working in different departments. In such situations when managers are given authority to look over employees from diverse backgrounds as in Dell and when workers are involved in making important decisions as in Siemens, knowledge of motivation theories is critically important for two reasons. First, it is important to motivate managers to steer employees in the right direction and second, to motivate workers to come up with innovative solutions to work issues. Such theoretical knowledge can help managers realise that irrespective of job type, a person high on positive affectivity is more likely to be satisfied with his/her job than a person high on negative affectivity. This can motivate them to carefully hire such workers who are high on positive affectivity. 4.1 Mechanisms for Developing Effective Teamwork within Siemens Difference between a team and a group is that former is a kind of group, while latter is not necessarily a team. Not all groups are teams, but teams are forms of groups. Informal groups are not authorised by organisational rules and regulations and they are created informally by workers. Formal groups are fully authorised and deliberately formed. Organisational framework regulates and authorises formal groups. According to Belbin’s team role models theory, there are action-oriented roles, people-oriented roles, and thought-oriented roles. Action-oriented roles are based on transforming ideas into actions and ensuring that work gets done on time. People-oriented roles are based on promoting collaboration and exploring more resources. Thought-oriented roles are based on assessing options, devising new innovative solutions, and providing skills (Mind Tools 2014). The nature of groups at Siemens is formal and group behaviour is in accordance with Belbin’s theory. Belbin’s model can be applied in any organisation by first carefully observing every team member for a set time period. Then, a list should be made to list important attributes noticed for each person. Strengths and weaknesses of members should be scrutinised separately. This can help to assign that team role to a person for which he/she is most suitable. 4.2 Factors that may Promote or Inhibit Development of Effective Teamwork in Siemens At Siemens, one of the biggest problems encountered in the way of development of effective teamwork was “the hesitant and unsupportive attitude and behaviour of top management” (Albach 1993, p. 133). Now, many important functions of teams ranging from completing work to developing system innovations to delivering quality to customers heavily depend on good communication. This is why a recent research survey has revealed ineffective communication “as the biggest barrier to team effectiveness” (Cardon 2014, p. 66). Good teams are based on a solid foundation of goals and norms. One of the most decisive goals is being able to negotiate or discuss options in a healthy way. Lower-performing teams do not make wise investments in discussing work problems which prevents team members from bonding around work issues. Research claims that organizing problem-solving meeting can help to align interests of managers and team members (Cardon 2014, p. 68). Many times teams perform poorly because there are conflicting interests. This conflict becomes a hurdle in the way of achieving a common goal. An important thing to remember when promoting development of team effectiveness is that conflicts need not be completely ostracized. Rather, research claims that they should be addressed in a way that shrinks negative aspects associated with them (Sheard&Kakabadse2002, p. 135). 4.3 Evaluation of Impact of Technology on Team Functioning within Siemens According to a research survey conducted by Siemens Enterprise Communications in 2012 which gathered data from nine countries, 79% of workers function as members of virtual teams, “while only 44 percent find their virtual interactions as productive as working face-to-face” (Martin 2013).This is a moderate success rate for virtual teams at Siemens which shows that workers are at least able to identify themselves as members of cohesive work group despite being separated geographically. Research has shown that such untraditional mode of networking and teamwork in which people are not physically present in the same room at the same time can have possible adverse effects on attitudes to work and the level of job satisfaction within an organisation. One of the most talked about adverse effect is that opportunities for social interaction are minimised. This is because virtual team members sometimes may never even “see each other face-to-face” (Phillips & Gully 2013, p. 393). Technology based means of communication involve the use of media like Skype. Such mode of communication allows people to work from their homes. But, it does not necessarily hinder good team functioning. Modern times have made it essential to use technology to promote virtual teams. This is because in situations when a lot has to be accomplished in a very short time, organising meetings in the old classic way is not always possible. At such times, technology saves time which is a critically important and limited resource. 4.4 Conclusions and Recommendations Concluding, Siemens and Dell are both big names in present day business world. Both are extremely competitive and ambitious and deal in different areas of products and services. Both have different organisational structures and cultures, but same leadership style that is transformational style. Difference in structures and cultures also affects employees at Siemens and Dell in slightly different ways. While Dell’s culture is more characterized by collaboration, Siemens’s culture can get sometimes fiercely competitive or even militaristic as identified by research. Knowledge of different models and theories discussed above can help senior staff to enhance performance at both Siemens and Dell because organisational culture and structure should not be considered a stable datum. Rather, those organisations survive which are flexible and change over time. Knowledge of different motivation theories and structures is important because it can help staff to know which concept can prove to be the best in specific time period. This knowledge is also of value because it helps to understand the difference between different kinds of leadership or management styles. 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