DHL Upgrades Direct LCL Services from China to the Middle East - Assignment Example

? DHL, Case Study Executive Summary DHL in the UAE is a subsidiary of DHL international with presence in over 220 counties across the globe making it among the biggest companies in the world (DHL, 2013a). It has a workforce of over 280, 000 employees who are able and willing to provide solutions to a number of logistic needs to and from any corner of the world. This company is a world leading postal and logistics group with most of its operations dealing with forwarding and freight and supply chain in different destinations. The organization performs activities such as task allocation, coordination, and supervision that is intended in achieving organization objectives and be properly scheduled in a proper line of culture. Introduction An organization can be analysed through various perspectives ranging from bureaucratic, contingency, cultural and political perspectives. Organization bureaucracy is witnessed both in private and public organizations depending on their structure and the culture. The system of bureaucracy is evident in DHL and it from part of the management structure and culture since it is a big firm with lots of activities carried on daily basis. Organizational culture can be considered as the basis for administration since each organization as its own set of rules that determine its behaviour. Every organization has their own unique cultures that are applied in their daily applications to achieve their aims and objectives. A proper organizational structure ensures that there is a smooth coordination and supervision of activities within the organization that hasten the performance of the organization (Spencern, 2010). The structure also acts as the foundation in which the standard operational procedures and routines are managed and determines which individuals participate in the decision making process. What is an organization? An organization is a mechanism for coordination actions of people in order to obtain something they desire by creating value .The vision of the company is to be a logistic company in the world, in their mission statement the company strives to simplify the life of customers and to make customers, employees and investor more successful. They make a positive contribution to the people around the by demonstrating utmost respect while achieving results (DHL, 2013b). The headquarters for DHL UAE is strategically located in Dubai since it is a world premier transhipment hub of the Middle East. The trade link amongst China and the Middle East increased to 190 billion dollars in 2010 and DHL is enjoying being part of the shipment and other related logistics. This paper analyses DHL Company in terms of contingency, cultural, bureaucracy and political perspective in order to understand their operations fully. What is the importance of the organization? The importance of the organization is to increase specialization and division of labour while using large-scale technology and proper external environment management. DHL in the UAE is a subsidiary of DHL worldwide express, a fast growing company in the enormous growth that is expected to continue in the near future (DHL, 2013c). The HR Department in collaboration with other departments is responsible for recruiting all the employees drawn from various backgrounds to provide the division of labour needed by the company. Administration and compensation benefits are the fastest growing areas of the HR department in the UAE Company. The salaries are being streamlined to match the regional standards of the company in order to minimize spending. The medical benefits, the employee leave, car allowance that was previously administered in ad-hoc basis are now formalized to bring them to regional guidelines. What is organization theory? This is the study of how organizations functions and how they affect and are in turn affected by the environment in which they operate. The requirements of organization theory are that managers select and manage aspects of structure and culture of the company in order for them to control the activities within the organization effectively. DHL, UAE is a global company that mainly deals with the logistics of different goods and services with headquarters in Dubai (DHL, 2013e). The company deals with the shipment of goods and services from one place to another. The company also offers other service to their customers like insurance of goods during transportation, tracking of goods during shipment and warehousing among other services. The company management has five directors who manage the company in their line of duty and they all report to the general manager. The managers are responsible for their functions that demands managing aspects of culture and structure to control the activities within the organization. The managers are within the same ranking in the organization but the work in different and independent departments (DHL, 2013c). What is Organization Bureaucratic? Since DHL handles peoples goods and provide services to them, there are strict rules that must be followed to ensure that the organization interact peacefully with their clients. The rules with regard to customs imports and export, deliveries and deliverances, inspection, the company's liability, internal conventions and routing among others (DHL, 2013d). Employees and the clients to avoid unnecessary problems during shipment and service delivery must observe the rules. These elements constitute bureaucratic management in private organizations that are solely managed to get profits. The principles of hierarchy and the levels of grade authority ensure that a firm has an ordered system of subordination to ensure supervision of the lower offices by the top management (Korczynski, 2004). This system offers the organization the possibility of appealing the decisions of the higher authority whenever they feel it necessary. Due to this system of bureaucracy, the office system is monocratic-ally organized to ensure smooth running of the organization. With respect to vertical and horizontal differentiation, the company has developed key delivery strategies by road, rail, sea and air depending on the urgency of the delivery and the quality of goods delivered. The company also tracks their clients' goods to ensure that they do not get lost in the course of shipment (DHLe, 2013). The company also offers other services like warehousing and distribution, custom security and insurance, and supply chain solutions according to customer needs. The goods are also handled according to their industries to avoid damage or contamination IE chemical goods, healthcare goods; industrial, technological are handled separately. With respect to integration, the company has laid out a service orient integration in order to remain competitive in the market. The business systems at DHL are integrated such that the client can apply online and track his shipment through an interactive platform in the concerned department. This gives the customer more value and service quality in exchange for his loyalty. The management of the modern office is based on written documents present in their original draft form and must form the basis of organization management. In bureaucratic management, the monies and the company equipment are totally separated from the private domicile of the officers to avoid unnecessary confusion during service delivery (Hodson et al, 2013). Whenever the office is completely industrialized, the official activities demands the full working capacity of the official regardless of whatever position one holds in the firm. The management of the office follows general rules, which are more or less stable and are rarely changed but can be learned from time to time (Hendry, 2006). According to Korczynski (2004), the knowledge of the rules presents the management with a good change of carrying out their activities without unnecessary conflicts. The office holding in bureaucratic management is thus vocational since it requires working for a longer period coupled with constant training of the employees. The employees must also pass special examinations that are a prerequisite for the employment of the company. The position of the official is in the nature of his duty thus determining the internal structure and his relationship with his fellow workmates. The modern official of a bureaucratic management is appointed by the superior authority after careful consideration of all the necessary requirements to determine whether they are fit for the post (Hodson et al, 2013). The officials are rarely elected for fear getting a compromise candidate for the post. The management enjoys enormous speed, precision, unambiguity, continuity, unity, strict subordination and other numerous benefits not enjoyed by other forms of management (Hendry, 2006). The capitalist market economy demands that the official business administration be discharged in a precise manner to avoid ambiguity and ensure continuity in the delivery of service. The business management throughout the rest on increasing precision, steadiness, and increased speed in overall operations that ensures increased profitability. Bureaucratic management ensures that they install a peculiar means of communication to fast track their operations (Spencer, 2010). Paramount importance to the bureaucratic process is the calculable rules that must be followed in the discharge of duties since the result should also be calculable. This is because bureaucratic organizations tend to be an organization of secret sessions whereby the moves of management are never publicized and only the right people are required to know such moves. The main importance of bureaucracy in DHL is that it enables the management have control and command over a large number of staff and numerous activities within them. Bureaucracy is also criticized (Hnendry, 2006; Hodson, et al, (2013), as they argue that in inhibits creativity and innovation since the employees are not allowed to act on their own. Korczynski (2004) also argues that bureaucracy lowers the morale of the workers leading to reduced productivity as a result of stringent rules and regulations. What is organization Contingency? According to Grant (2007), contingency theory contends a match of approach to the situation to improve the prospects of success in the implementation of the organizational objectives. Miller (2007) also adds that the process of implementation of the objectives of the company is of great importance in achieving strategic objectives of the company. Implementation difficulties thus represent the biggest challenge to organizations who wish to achieve success in their strategic plans (Hepburn, 2006). Different companies use various approaches in the implementation process; the experts are expected to take a liaison role just like the sales representatives in order to develop awareness through rational arguments in all their undertakings (Groevneveld and Walle, 2010). This enables them to draw on knowledge of bargaining and persuasion to promote adoption of the intended action. Bonding approaches attempt to deal with the feeling of stakeholders and try to win them over to promote understanding between the various factions (Iedema, 2007). Since DHL is heavily involved in logistics, the level of technological use is very critical to the organization. The company has developed technologies that can accommodate global sourcing, complete supplier relationships, shorter business cycles as well as other technical operations (DHLf, 2013). The involvement of stakeholders is observed in many studies that describe how interest decisions are made. Persuasive tactics are evident in the manner and means the management caries their duties in several departments. Persuasions are always disguised as negotiations, discussions, and bargains in order to achieve the necessary control of the organizations (Hepburn, 2006). This company fits strategically with its objectives and operations in all respects. The nature of company objectives that involves both air, sea and land transport match their resources for the company possesses the necessary equipments for such trade. The company is strategically situated in Dubai, which is the centre of trade in the UAE, and thus it takes advantage of enormous shipping opportunities in that region. The company thus combines a unique combination of resources and its capabilities to develop eventually into a competitive advantage to achieve profits. The implementing manager has the advantage given by the position of power and the role that enhances the prospect of success in the organization. The organization thus balances between high and low advantage situations according to the resources and power they have to achieve success. The implementation approaches should thus build commitment such as participation in their practices. Structural contingency plays a very important role in the organization design by specifying which structures fit which circumstances and in what time (Hepburn, 2006). There is a good match between organizations formal structure and the environment that it operates. DHL UAE is situated in a busy business environment that requires strong commitment to work and the organization structure enables the employees to work diligently due to direct supervision from their seniors. There is no evidence of significant structural problems since the department is well separated to work independently with proper supervision. Cultural perspective Organizational culture can be considered as the basis for administration since each organization as its own set of rules that determine its behaviour (Morril, 2008). Cultures provide the type of organization that will enter the market together with its role and image to other people. Individuals from different cultural backgrounds create an inspiring and open-minded atmosphere by freely interacting with each other in their respective workplaces. (DHLc, 2013). As envisaged in their mission statement, the company majors on the simplification of the lives of their customers, employees, and shareholders by making a positive contribution to the world. Through proper interactions with the customers, the company adds value by providing them with excellent services or products by engaging employees and nurturing their talents. The company also shows concern for the community around them by various corporate responsibility programs under the motto of living responsibly. The purpose of the company is to deliver joy, prosperity and trust by transporting health and powering growth in all communities. The members of workforce are well educated, attend continuous training in order to sharpen their skills in the workplace, and are allowed to assess their talents, passion, opinions, and personality. Since the organization demands the best from their employees, the employees are also provided with the best services that entail high professional, supportive, and exciting work environment. Every employee is expected to work extremely hard to achieve the targets thus making the organization to move to its profitability status. All the members are expected to be accountable in all their undertakings and be transparent at all times. The new members are well introduced into their departments and so that they are properly recognized by their fellow workmates. They are then put under some guidance on how to perform their duties with supervision to ensure that they do not mess in the course of their work. This method is very helpful to the organization as the members easily adopt the organization culture that is designed to achieve maximum productivity. The newcomers in turn maximize their productivity since they quickly feel comfortable in their new working environment and this increases the profitability of the organization. The organization encourages the members to develop an institutional role orientation since they strongly believe in the culture of their organization. Individualized orientation is not encouraged since the leadership believes that all the employees of the organization are one entity driven by a common goal. The subcultures within the organization only exist to the extent that individuals come from different backgrounds and there is no discrimination based on religion, race, sex and skin colour. The existing organizational structure strongly fits the organizational culture in various respects. The structure of the organization is arranged in the sense that all line departments are arranged in the same area to ensure easy supervision of workers. The managerial offices are at the same level of rankings to ensure that no malicious acts that may solicit unnecessary reaction from other departments. In the DHL context, the company is involved in the both air and sea freight with the biggest market share in the UAE (DHLf, 2012). The large number of employees and the many destinations require an appropriate culture for the organizations. A logistic service execution is thus necessary for the successful service delivery to those places. In the beginning, the company realized that their logistic procedure is not effective since it was not compatible with the needs of most people. They identified lean sigma implantation problem as document took several days to reach their destinations especially on seas fright. This generated high storage cost that were not necessary and lead to losses in expected profits to the organization. The six sigma was then applied to the organization and it greatly simplified the process of customer delivery. Political The organization is categorized such that engineering department only performs duties related to engineering activities within the organization while logistic department performs logistic purposes within the organization. The performance within various departments leads to operational efficiencies within the group and gives the top management easy time to oversee the duties performed by those departments. The organization uses the power in various aspects of problem solving, reward systems, decision making and others within their political structures. The organization operates by distributing authority and setting a stage for exercise of power and thus the individuals are highly motivated to secure and use the power in their respective departments. The development of careers for high and managerial professionals depends on the accumulation of power as the vehicle for transforming individual interest in activities that can positively influence others to work diligently. In this firm, the distribution of power is in balance for individuals or groups are made to take the consequences of their decision-making actions. Managers obtain power by the nature of their offices that are well defined and the scope of their duties well described (O’Brien, 2002). The subordinates in every department are expected to fully respect and comply with the managers' decisions in order to ensure that power only comes from one direct source. The decision making authority rest with the line managers and they use the power vested upon them by the management to effectively control their subordinates work diligently in achieving the company objectives (Tadajewski, 2010). There are coalitions when the company needs to address an issue that cannot be won by individual departments and they are formed on the basis that each department has something to achieve on that coalition. Since such coalitions are always formed occasionally, they are usually disbanded when they need ends. Since power is well distributed in this organization, there is a reduced conflict in management as each department works independently of the organization. The decision-making in the organization is this prompt since the top management channels such decision to the line departments for easy coordination. I would recommend that each decision be made at the appropriate level of the organization that is neither too low nor too high to avoid the risk of undue influence from any group of individuals. This also avoids the negative consequences of making decisions too high that dilute the natural incentive for good decisions that are made by top management. I would also recommend that the assemblies responsible for decision-making should be refined continuously to maintain the optimum distribution of power within the organization to avoid stagnation. Continually refining the organization avoids the organization being hijacked by the very people commissioned to manage it since they may use the power for their own benefit. Conclusion DHL UAE is a subsidiary of DHL international that provides logistic services to customers in different parts the world. The company handles many people from different places and thus has rules within the organization set up to ensure that the organization interact harmoniously with its customers all the time. The rules that are applied in this company mainly regards to custom imports, delivery and deliverances, inspections, company liability among others. The principles of hierarchy and levels of authority ensure that the company has endorsed orders of subordination that ensure easy and efficient supervision of activities. The company has developed a technology system within the organization that ensures contingency in meeting customer needs. The company is also strategically situated in Dubai that is the heart of trade within the United Arab Emirates to exploit the shipping opportunities there. The employees are made to appreciate and encourage the organizational culture that ensures that the needs of the customers met and that all the employees of the organization are one entity driven by a common goal. The managers within the organizations obtain power by the nature of their offices that are well structured and roles explained. Power is well distributed within the organization to reduce conflicts that may result from managerial activities. References DHL. 2012. Press release. DHL upgrades direct LCL services from China to the Middle East. (Online). Available at http://www.dhl.co.ae/en/press/releases/releases_2011/local/092611.html (Accesed on 8th Nov, 2013) DHL. 2013(a). Our Mission and Vision. (Online). Available at http://www.dhl.co.ae/en/about_us/company_portrait/mission_and_vision.html (Accesed on 8th Nov, 2013) DHL. 2013(b). Our Organization. (Online). Available at http://www.dhl.co.ae/en/about_us/company_portrait/our_organization.html (Accesed on 8th Nov, 2013) DHL. 2013(c). Terms and conditions: Shipping by DHL Express. (Online). Available at http://www.dhl.com/en/express/shipping/shipping_advice/terms_conditions.html (Accesed on 8th Nov, 2013) DHL. 2013(d). Logistics. (Online). Available at http://www.dhl.co.ae/en/logistics.html (Accesed on 8th Nov, 2013) DHL. 2013 (e). Supply Chain Analysis and Design. (Online). 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(Answered in the 2nd paragraph) What is the importance of organization? (Answered in the 3rd paragraph) What is organization theory? (Answered in the 4th paragraph) What is contingency approach to organization? (Answered in the 11th paragraph) What is organization bureaucracy? (Answered in the 6th paragraph) Read More