How Technology Plays an Important Role in Organizational Structures - Assignment Example

Running Head: EVALUATION AND ANALYSIS CASE STUDY Evaluation and Analysis Case Study [Writer’s Name] [Institution’s Name] Evaluation and Analysis Case Study Introduction Every organization has it’s own structure and culture. When this distinct organization has to merge with an other organization a multitude of issues arise. Such a case study shall be analyzed in this paper. The paper also analyzes how technology plays an important role in organizational structures. Indigo and Chapters are bookshop chains in Canada . Indigo and Chapters both had similar organisational structures – a functional-based design. Indigo’s corporate structure, for instance, consisted of departments such as marketing, human resources and retail. Indigo gained control of the nationwide chain of 210 Cole’s Books and SmithBooks stores, as well as a new internet division, Chapters Online. The structure of the newly merged organisation had to change in order to incorporate these new businesses. They went through a merger and faced major losses. This paper discusses the case with the help of a few question which are answered in the discussion. Discussion Answer 1 In an organization which is merging it’s self with another organization usually faces a lot of structural issues. According to Krug (2009) structural issues which an organization faces, can be the manner in which the staff interacts with the top management and how the information is passed on to the customers. Other issues may include operational policies, which include the culture of the organizations. These polices are not written in black and white, yet they become an important part of the organisation’s structure. For instance if one organization has a workaholic and informal environment , while the merged one has a more corporate and formal way of communication. In this case an issue may arise after the merge takes place. Another issue which arises is that organizations usually do not consider the culture as part of the organizational structure, and try to change it that is when a major issue arise. According to Straub (2007) the bigger or stronger organaztion tries to implement it’s culture and way of operating in the smaller organization. Of course, the smaller organization is offended and tries to make it’s culture an point of view stronger then those which have been thrown on upon them. However the large one also pushes back and thus it turns into what can be called civil war. This is a major issue when two organizations merge. Considering the above discussion why Indigo should consider both a partial mechanistic and partial organic structure. The management of the organization is based on a mechanistic structure. However maybe even organic structure in the 300 stores to enable flexibility and decisions of a day to day nature to be made close to where stores function Answer 2 Structure is important for any organisation. In the smaller organisations there are fewer of structure. The allocation of responsibilities and affiliation among employees of the organisation can also develop in an informal manner . However, there is need for a formal organisational structure in larger organisations. Considering the importance of its growth and development, the organizational structure has to be continuously changed according to it’s circumstances. This helps in ensuring that the organization has the most suitable structure, especially for the very large organisations. According to Mullins (2007) the structure of an organisation affects not only productivity and economic efficiency but also the morale and job satisfaction of the members of the organisations. . According Mullins to (2007).Structure should be designed so as to encourage the willing participation of members of the organisation and effective organisational performance The reason why organizations need a suitable structure is the equal the division of responsibilities amongst the employees of the organisation and management of their actions . In this way they can work to fulfil the objectives of the organization and develop themselves at the same time. According to Kunov & Sitnikov, (1999), the improvement of the organisational capacity and increased the coherence are supported by strong internal organisational structure; a structure is necessary to solve the problems of collective action and minimise the transaction costs. Pleshko (2007) suggested that structural form is shown to have an influence on profitability. Organizations which have a simple organizational structure turnout to be more profitable then those which have complicated structures. Pleshko (2007) further stated that somehow, it is commonly accepted that specific structural forms do influence operation The organizational structure will portray how the organization may respond to improving and making their future brighter. The organizational structure will also give an idea of the firm’s fluidity and flexibility, to the idea and implementation of change. the organizational structure helps eth organization to function in an orderly and proper manner. It gives the employees a direction to work in and sets an appropriate hiarcahy of the management. This organized manner of work takes the form of a particular structure which defines the entire organization. The organization is recognized in the industry due to that structure. Important aspects of an organizational structure would involve the span of control and the scalar chain. The span of control refers to the number of subordinates that a supervisor controls. A short span is normally called a tall, centralized structure, while a wide span leads to a flat decentralized one. The scalar chain refers to the number of levels in the hierarchy and also establishes the vertical graduation of authority and responsibility. Answer 3 Considering Indigo’s kind of business and organizational structure I could implement a partly mechanistic structure and part Organic structure. The mechanistic structure may be implemented for the communication and decision making of the top management. The Organic structure may be implemented for the decision making of the in house staff of the 300 stores they have The reason why Indigo should implement a mechanistic structure for the top management communication process and decision making is that these structures similar to a bureaucracy and are extremely formalized as well as being centralized. According to Burns & Stalker (1961), communication in this kind of structure is completely based on formal channels. The job responsibilities are very rigid and are too followed carefully. According to Moore & Brown (2006), such an environment is usually stable environment for the top management is essential. The main advantage of which Indigo may get from such a structure is efficiency. Thus, in organizations that are attempting to take full advantage of efficiency and reduce costs, this kind of structure is the best option. According to Burns & Stalker (1961), this kind of structure even has an advantage of having the quality of centralization. Thus, it highlights the exact importance of decisions made at higher levels of management. If Indigo’s top management utilizes a mechanistic approach, then a lot of important decisions will be made at the higher levels of management like they should be. Indigo’s top management can show that its follows an mechanistic structure as by ensuring key strategies for CEO in forging a new culture are carried out and to ensure that bits of the old culture brought in by employees of the two different previous company cultures are not brought into the new organisation). Therefore this type of approach might suggest mechanistic for key positions and decision As for the decisions related to improvement in store an organic structure should be implemented. This should be implemented as, thins kind of structure is flexible and decentralized. According to Miles & Snow (1978) this means that it has low levels of formalization and communication with the management is more flowing and flexible. The fact that this kind of structure has the quality of decentralization makes it an ideal organizational structure for the joint decision making for the improvement of services of the 300 Indigo stores. In such structure the daily and decision-making tasks are assigned by top management to the more middle and lower-level mangers, this lets the top management to pay more attention to other important decisions. Thus, mechanistic structure comes in where the major decisions are only made by the top management. According to Moore & Brown (2006), in such cases the communication lines are made rigid and less fluid. Organic structure should also be applied to the store relating decisions, as the employee job descriptions consist of a variety of duties. When the Indigo will need them to do something even if is not apart of their job description. By combining both structures the job satisfaction of employees will also increase. Apart from this the important issues in the organization will be resolved without any conflicts. The employees and management will work together to improve the service, and the management will also work separately to improve the entire system of the organization. Indigo will also be able to make it’s employees use their innovation when it comes to decisions relating improvement of services. The fact that indigo will be concentrating on both factors the 300 stores as well as the incorporation of the new culture makes the combined structure an ideal one Every store manager acts separately and is responsible for their own actions. Employees also feel that they are part of the company. The management on the other hand is still under control and can implement their decisions on the employees. Thus, it can be said that if a combined structure is implemented then it will be win – win situation for the top management. Answer 4 Technology can affect Indigo’s organizational design in various ways. Technology is an essential component of the organizational design. It improves and manages an organization’s entire communication process. Thus indigo may require a strategically placed technology as it may effect their internal as well as external communication process. According to Malhotra (1993) It will help in enable monitoring of more people with fewer managers, enable better service and reaching more customers using less staff. The customer data in computer will help to provide customers with the necessary information with in minutes. Staff can also be monitored as to what they are doing. Their leaves and performance everything can be monitored by it. Thus, thus Indigo will require less staff and managers. Technology may also affect the manner in which Indigo’s targeted market data is managed, it will also have an effect on the way they align their internal communications systems. Thus it becomes important for organizations to study and implement innovate technology as it truly affects their organizational design. Brynjolfsson and Mendelson (1993) emphases on the fact that technology based systems and effect it has on structure of organizations are equally determined. To the degree that computers make lateral communication economical and less costly, allow organizations to attain a sufficient amount of data to process, or enhance the abilities of employees so that they can perform information processing tasks. According to Wyner and Malone (1996) a reduction in communications costs allow organizations to follow a decentralized organizational structures as well as , successfully implement an centralized system when management can communicate with their employees and view the processed data. Conclusion The above given detailed discussion gives an overview of the importance of organizational structures, issues regarding mergers and importance of technology. However, first and foremost the entire discussion answers a series of question which shed light on the case of Indigo and Chapter’s merger. It also gives ample recommendations to Indigo to use a combined organizational structure, i.e mechanistic and organic. As, mentioned in the discussion above a combined structure will help employees to feel that they are part of the company. The management on the other hand is still under control and can implement their decisions on the employees. Thus, it can be said that if a combined structure is implemented then it will be win – win situation for the top management. In order to attain success Indigo should implement this recommendation. This may even help them turn their losses into huge profits. Thus it can be said that, an organization’s strengths is it’s structure and technology is an important element of the structure. Apart from this it can also be concluded that mergers are not as easy as they seem. A lot of issues arise and if those issues are not resolved on time then the organization may face losses. References Brynjolfsson, E., and H. Mendelson (1993). Information systems and the organization of modern enterprise. Journal of Organizational Computing 3: 245-55. Burns, T. & Stalker, G. M. (1961), The Management of Innovation, Tavistock, London. Krug Jeffery (2009). Mergers and Acquisitions: Turmoil in Top Management Teams. Business Expert Press Kunov Andrei and Sitnikov Alexis (1999). "Economic Legislation of the Duma: The Role of Organizational Structure," Russian Economic Trends, v. 8, no. 2 Malhotra Yogesh (1993). Role of Information Technology in Managing Organizational Change and Organizational Interdependence . Brint Institute. Miles Raymond E. and Snow Charles C. (1978). Organizational strategy, structure, and process. New York: McGraw-Hill Book C Moore Brad and Brown Alan (2006).“The Application of TQM: Organic or Mechanistic?” International Journal of Quality and Reliability Management Vol. 23. Issue 7. Mullins, L.J. ( 2007.) Management and Organisational Behaviour. FT Prentice Hall Pleshko. L.P. (2007). Strategic orientation, organizational structure and the associated effects on performance. Journal of Financial Services Marketing . 7(3), 258-266 Straub Thomas (2007). Reasons for frequent failure in Mergers and Acquisitions: A comprehensive analysis. Wiesbaden: Deutscher Universitätsverlag Read More