Royce Consulting: Organizational Structure - Case Study Example

Royce Consulting consults primarily for major businesses, meaning that consultants are directly on site in countries across the globe. Royce has 160 locations, one of which has 124 people working. Entry-level staff are hired directly from college, promoted internally; managers maintained client contracts, managed personnel and assisted executives and leadership in creating consultation proposals. Their specific infrastructure is highly minimal: They are a virtual company in many ways, whose rank-and-file staff are often being held up at hotels or the houses of friends or offices of clients. Their infrastructure overhead is thus also nominal. In general, their only fixed costs are basic management and the necessary technology to do research for and assist with clients; aside from that, the firms operations are variable, able to scaled up or down to the degree of business. Innovations being considered for infrastructure are a hoteling system for managers and a virtual office software suite. Potential issues for Royce are a few fold. First: Introducing new technological changes involves administrative overhead and techniques. Nothing is more useless than a website that doesnt work or an e-mail system that doesnt get answered or isnt used. Technology often needs to reach a critical mass of expertise and participation to be worthwhile. Neither administrative an support personnel nor graphical design personnel had any expertise with virtual office-style programs, or indeed anything beyond Word. Second: Their headquarters, which are admittedly of nominal importance, are in the Midwest. As large as cities like Chicago or Detroit may be, it seems that a different headquarter choice might be more fitting. Since most personnel are on-site or in transit, their headquarters are half empty virtually constantly. This was the impetus to create the hoteling system in the first place: To be able to cut permanent offices. Third: A directive style of management is not appropriate for a company of this nature. It is true that command and control needs to be more sophisticated and often stricter when workers are spread out geographically, but at the same time, having top-down communication and directives prevents those same workers from developing autonomy that allows them to keep in touch in relevant ways. When management is far away from the worker, the worker has to be self-directed and report salient issues on their own: Monitoring is impossible. A directive style clashes directly with this objective. And since partners control most of the deals, it further reduces the autonomy that rank-and-file people, who are college educated and presumably savvy, to pay attention to their surroundings and to client needs and to build what theyre doing directly. Its especially problematic when compared with their progressive training system, which spends extensive time preparing already-educated workers for consulting and autonomy then obviates that need with a top-down management hierarchy! Since much of the behavioral knowledge and corporate culture is passed down by manager-worker apprenticeship, it becomes even more suspect to have such direct control. Fourth: Manager and worker involvement was not solicited for the creation of the five-year plan or the hoteling or virtual office concepts, despite the fact that partners would still hold ultimate veto power in any arrangement. This becomes especially galling when it is realized that “the move to hoteling was necessary but [partners] were glad it wouldnt affect them”: in other words, the people who were affected least by the change were most involved. Managers were uniformly hostile to the idea and viewed it as insulting. Thus, Royce Consulting faces serious command-and-control and organizational structure problems that might cause long-term issues even given progressive training, corporate values and culture, etc. The causes of all of the related issues is a top-down management structure. When it came to the virtual office and hoteling system, executives failed to consult with management, who are promoted quickly from the ranks of entry-level workers and thus tend to be closer to them than to higher management and partners. Again, partners ultimately have veto power, but hearing from management would have allowed innovative solutions to be heard. One thing that the company could do is give managers a stipend to create a home office and use the money they are saving on leasing to facilitate telecommuting systems (which they are doing to some extent with the virtual office), providing for the cost of company lunches and increased car use, and letting workers create a professional setting that they can greet clients in. Another solution might be to rent smaller office space across the country, so that managers would live closer to their general clientele and travel less, maximizing the office space while increasing company insertion. In particular, since most managers felt that productivity would go down without an office, the organization needed to consult them to determine exactly by how much and compare that to the savings of the lost leasing overhead. The company needs to change to a less directive format. Beginning with entry-level workers, autonomy should be encouraged and developed. In consulting, it is important that the person speaking directly to the client has both the confidence and skill to proactively offer solutions to new problems that emerge and the institutional backing to quickly create them after little to nominal consultation. This less directive format would have caused them, when restructuring the office, to bring in the people who were being most impacted by the decision. They would have found that most managers would not voluntarily give up an office, such that other solutions should be explored. Aside from those mentioned, solutions to the office problem could include mobile buildings that are office space when necessary and can be used for consultation issues, storage or in turn sub-let when they are not. Most managers dont mind moving their office now and again: They mind not having one, not having some kind of stable place at any given moment to organize their files and be able to meet clients in their own settings. These compromise solutions should be implemented after they are proposed by managers, alongside any other solutions that would work for managers while still cutting down on leasing. Ultimately, the company is a kind of company that benefits extremely from having a back-and-forth on major issues and a great degree of initiative at every level; it needs to make sure to develop that with a better organizational structure. Read More