Assignment 1
Assignment 1
4550 words
Structure:
1. Position statement
2. Reference Points from HBR
3. What do I think about it?
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Many different ones but Johnson & Scholes aboveIn other words, strategy is about:
https://www.masterclass.com/articles/organizational-strategy
https://getsling.com/blog/organizational-strategy/
https://online.wlv.ac.uk/how-to-create-a-good-organisational-strategy/
https://digitalleadership.com/blog/organizational-strategy/
https://www.compt.io/what-is-organizational-strategy-and-how-to-incorporate-it-in-
your-business
Step :1 Strategic objectives and analysis: Mission, Vision, Values. SWOT, PESTLEE, Portor,
Ansoff, staff and organizational readiness
Step:3: Evaluation
Step:4 Strategic Implementation: force field analysis
Step:4: Strategic implementation and control: KPIS, Metrics- all stakeholder KPIs are
reached
https://courses.lumenlearning.com/suny-principlesmanagement/chapter/stages-and-types-
of-strategy/
https://courses.lumenlearning.com/suny-principlesmanagement/chapter/stages-and-types-
of-strategy/
https://noteslearning.com/elements-of-strategy-formulation/
https://corporatefinanceinstitute.com/resources/management/strategic-analysis/
https://onstrategyhq.com/resources/strategic-implementation/
https://www.managementstudyguide.com/strategic-management-process.htm
https://www.managementstudyguide.com/strategy-formulation-process.htm
https://www.managers.org.uk/knowledge-and-insights/resource/developing-strategy/
https://www.business-to-you.com/ansoff-matrix-grow-business/
https://uk.indeed.com/career-advice/career-development/horizontal-integration-vs-vertical-
integration
https://tipalti.com/horizontal-vs-vertical-integration/
https://www.netsuite.com/portal/resource/articles/erp/horizontal-integration.shtml
https://www.wallstreetmojo.com/horizontal-vs-vertical-integration/
https://www.mbacrystalball.com/blog/strategy/vertical-horizontal-integration-
strategy/
https://www.fohlio.com/blog/vertical-vs.-horizontal-integration-a-comprehensive-guide
QUESTION 1:
1. Evaluate the advantages and disadvantages of the organisation
structure in your organisation (or an organisation with which you are
familiar) and evaluate the advantages and disadvantages of one other
organisation structure. Within the evaluation, you should include the
reasons underpinning the structure. (AC 1.1)
Position statement:
A Functional organizational structure has centralized leadership, and the vertical, hierarchical
structure has clearly defined roles, job functions, chains of command and decision-making
authority. (Christine Organ, 2023).
Dubai Holding Group is a Dubai based company in the fashion retail industry, with a
Functional organizational structure. The company is owned by three Emirati Partners,
managing 6 franchisee brands (Zara, Zara Home, Stradivarius, Lefties, Sfera and Women
Secret). The company operations are headed by the General Manager, with the respective
Department Heads reporting to him – HR, IT, Finance, Brand Managers, Project Manager and
Marketing. The Inditex Brand Managers (Zara, Zara Home, Stradivarius, Lefties) report
directly to the Senior Commercial Manager, who reports to the General Manager.
The WHY?
This type of structure has been designed for the company, due to its scalability, consistency,
clear division of specialised work with accountability since the retail operations are spread
across in U.A.E. and other G.C.C. countries. The HR, IT, Finance, Project & Maintenance,
Marketing Teams based in Dubai Head Office are the one- stop shop for all brand’s retail
stores in U.A.E. and in G.C.C. countries.
Dubai Holding Group has the Purpose as Service, Growth, Partnership, and Innovation.
Hence, it becomes critical to have Functional organizational structure for efficiency, through
providing consistent service levels, sustained growth in all retail stores in the GCC region,
specialised division of work, with centralised control from the Dubai Head Office. (Patrick
Gleeson, Ph. D., 2022)
Pros & Cons of Functional Organizational Structure (Indeed,2023)
Advantages Disadvantages
Clarity regarding the chain of command The individual departments have become
with a Centralised Dubai Head Office helps siloed in their way of working, leading to
in better data reporting. This essential aslittle cross-departmental communication and
company manages six franchisee brands. collaboration.
Clear division of specialised skill sets inThere is huge resistance to change,
respective departments especially for adoption of technology and
innovative practices, as individual
departments struggle to understand how
automation could contribute to the big
picture goal achievement for the
organization.
Clear accountability for job roles & Decision making takes longer with
responsibilities in respective departments approvals required from the Partners,
General Manager, and each departmental
head.
Transparent reporting lines with clear Each department does not have the big
understanding of hierarchy picture view of how other departments are
contributing or working towards achieving
organizational goals. There is a major
discrepancy in understanding the Standard
Operating Procedures, processes, and
workflows of other departments.
Has aided in developing the business from There is little or no Bottom-Up
the U.A.E. market to other G.C.C. countries communication and autonomy, especially
with efficiency due to sustained scalability
in this structure for the frontline retail store staff to the Top
management, leading to a gap in
understanding customer feedback and
employee feedback.
Training is offered suited to each
departmental skill sets- for e.g.: Sales
Assistants with Customer Experience
training, Inventory Team with RFID
(Systems) training, Accounts and Audit
team with SOP (Process) related training.
This creates clear career progression paths
for employees in each department.
Position statement:
In a flat organization, there are little to no management levels between superiors and staff. It
promotes an increased involvement in decision-making with less supervision. (William
Craig, 2018).
London International Studies and Research Center (LISRC) is a Dubai based company, which
has a flat organizational structure, headed by the CEO, who directly manages the Sales, IT,
Accounts, HR, Admin, Graphic Design, Training and Marketing teams with no middle
managers in between. There are three part time employees in Sales who work from home,
based on commissions only basis. The company is based in the Ed-Tech industry, offering
CPD UK Certified courses in Digital Marketing, Human Resources, Data Science and
Cybersecurity.
The WHY?
The flat structure works well as the company is a start-up and small, with 17 employees. All
the employees have the CEO has their reporting manager, with no middle level managers in
between. The CEO has total control and command over the business, being a start-up born in
2018. The Vision of the company is – To be a Global Leader and become one of the Pioneers
in the Ed-Tech industry. This goal is being achieved through aggressive digital marketing
channels, tie-ups with Government organizations, fast decision making as per changing
market conditions, all fuelled by the ambitious company CEO, with tight control over the
operations of the company.
Advantages Disadvantages
Decision making is faster with no hierarchy The span of control of the CEO was high -
and bureaucracy 17 employees, leading to his burnout with
increased workload
Innovation and collaboration between There could be delay in work progress, if
employees are higher, with one leader employee is not self -motivated or not
guiding the vision of the company monitored closely by CEO
Employees have autonomy and are well- This structure is difficult to scale up, for
motivated example when opening new branch in Saudi
or Abudhabi, which did not work out
The company can adapt quickly to change There is no internal promotion path for
in market conditions or customer needs, due employees, which led to employee turnover
to one decision maker – the company CEO due to lack of career progression
opportunities
Bottom – up communication is faster and
important, due to CEO’s focus on getting
direct feedback with open door policy
2. Analyse connections between your organisation’s strategy (or an organisation with
which you are familiar) and its products or services, and customers. (AC 1.2)
Analyse how strategy needs to be integrated with products/ services and customers.
You can analyse the vertical and horizontal integration with strategy to achieve organisational
goals. Think about the outcomes of strategic planning tools such as SWOT and PESTLEE.
You can discuss how strategy is formulated and how it links with products/ services and
customers.
Analyse: to break something into its component parts and show how they relate to one
another. In this case, think about the link between organisational strategy and its products,
services, and customers with strategy.
How organisational strategies are shaped by the business and external contexts;
organisational insights and organisational performance; models of strategy formulation and
implementation; concept of vertical and horizontal integration of strategy and how it connects
with products, services, customers.
Position statement:
Inditex Group (Industria de Diseño Textil S.A.) was established in 1985 in Spain by its
founder Mr Amancio Ortega, with its first brand as Zara opened in 1975. One of the pioneers
in fast fashion, the company grew quickly with other brands like Zara Home, Lefties, Oysho,
and acquisition of Massimo Dutti, Pull Bear, Bershka and Stradivarius. The business strategy
of Inditex Group focuses on the concept of Fast Fashion, with strengths of vertical integration
and supply chain management, digital transformation, all with sustainability. Some key
figures mentioned in the Inditex FY Report 2023: Sales grew +10.4% to reach €35.9 billion,
opened stores in 41 new markets, has 251 million followers on social media, with Gross
profit increased 11.9% to €20.8 billion. A sustainable strategy aligned with its products,
services, customers, and people has helped the organization to retain its foothold in
the ever-changing fast fashion industry. (Inditex.com, 2024)
The How?
Inditex Group follows the 4E Model of strategy- Explore, Enable, Evangelise and
Exploit, producing designs in small batches and then producing depending upon the
market response. The Unique Selling Proposition of the company and its brands,
lies in its ability to ship a garment from the stage of inception to the shop floor
within 15 days. (Economist, 2015)
The Strategy of Inditex Group is based on four pillars: Unique fashion proposal,
increasingly engaging shopping experience, extraordinary team, sustainability,
and responsibility.
Based on the SWOT and PESTLEE Analysis as below, Inditex Group has utilised
Vertical and Horizontal integration to be ahead of its competitors.
Vertical integration: Having a 100% control on the resources and costs by owning
the process from purchasing (buys fabrics from own company: Comditel), designing
to manufacturing (more than half of its factories are self-owned) to the retail stores.
This has been possible through the effective collaboration of the designers with the
manufacturers in the Cube in Inditex Headquarters and the Logistics Hub in
Zaragoza, through the Just in Model.
Transversal and Collaborative Innovation which is the basis for the four pillars
of the company’s strategy and touched every point of its business life cycle. It is
limited not only to the company and its people but to other organizations, or person
to build a sustainable future. A few examples are Zara’s Pre-owned platform, virtual
shoe fitting in Pull& Bear and Zara Home’s detergent, The Laundry which is eco-
friendly. (Inditex strategy, 2022)
Materiality Analysis is one of the most critical ways by which Inditex evaluates
what is important for all stake holders (internal and external) with Financial
materiality (for Inditex) and Impact materiality (on other stakeholders). (Inditex
strategy, 2022)
Stage 5: Controls
In 2023, sales grew +10.4% to reach €35.9 billion, showing very satisfactory
development both in stores and online. (Inditex Annual Report, 2023).
Hence, the strategy of Inditex group is focused on the four pillars: (Inditex Annual
Report, 2023)
1. Christine Organ, 2023. 7 Organizational Structure Types with examples. Available at:
https://www.forbes.com/advisor/business/organizational-structure/ (Accessed 28 April
2024)
2. Patrick Gleeson, Ph. D., 2019. Purpose of Organizational Structure. Available at:
https://smallbusiness.chron.com/purpose-organizational-structure-3812.html
(Accessed 28 April 2024)
3. Indeed, 2023. A Guide to Functional Structure: Benefits and Disadvantages. Available
at: https://uk.indeed.com/career-advice/career-development/functional-structure-
benefits-and-disadvantages (Accessed 28 April 2024)
4. William Craig, 2018. The Nature of Leadership in a Flat Organization. Available
at:https://www.forbes.com/sites/williamcraig/2018/10/23/the-nature-of-
leadership-in-a-flat-organization/ (Accessed 28 April 2024)
5. Jacob Morgan, 2015. The 5 types of Organizational Structures: Part 3, Flat
organizations. Available at:
https://www.forbes.com/sites/jacobmorgan/2015/07/13/the-5-types-of-
organizational-structures-part-3-flat-organizations/?sh=17e2a2c86caa (Accessed
28 April 2024)
6. Inditex website. History of Inditex. Available at:
https://www.inditex.com/itxcomweb/en/group/history (Accessed 28 April 2024)
7. Inditex Annual Report 2023. Available at:
https://www.inditex.com/itxcomweb/en/press/news-detail?contentId=10da31b6-