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Assignment 1

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0% found this document useful (0 votes)
131 views24 pages

Assignment 1

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minunair2024
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
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ASSIGNMENT:1

ORGANIZATIONAL PERFORMANCE AND CULTURE

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)
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)

3. Analyse three external factors or trends currently impacting your


organisation (or one with which you are familiar). The impact of these
factors or trends could be positive, neutral or negative, some are short-
lived whilst others are long-lasting. Identify organisational priorities
arising from the factors or trends analysed. (AC 1.3)

4550 words

Structure:
1. Position statement
2. Reference Points from HBR
3. What do I think about it?

https://www.cipd.co.uk/knowledge

https://www.cipd.co.uk/knowledge/journals

https://www.cipd.co.uk/knowledge/hr-learn-develop-database

• Font size: 12
• Font type: Arial or Times New Roman.
• 1.5 line spacing
• It is not recommended that learners write using a bullet point format as it
does not allow them to show the breadth of knowledge required for
associate level.
• Please submit with the following documents in one file: (refer to the
submission checklist for each module)
– Assignment cover sheet and checklist (only one needed for each
unit and in case of resubmission, this needs to be attached as well
and amended)
– Assignment (try and keep all activities/parts of the main
assignment in the same file)
– Appendices
– References/Bibliography list– Harvard style
• Must be submitted as a Word document so the word count can be
checked. Attach PDFs/PowerPoints where unavoidable.

NOTES from Session1: 20 April 2024


1. Economic sectors of organizations: government, private and non-profit
2. Industry sectors of organizations
 Primary sector: agriculture
 Secondary sector: make products from primary sector.
 Tertiary sector: services industries like travel, hospitality
 Quaternary: industries providing information services: IT, Consulting,
R&D
3. Features of organizations:
 Organisational culture
 Organizational processes
 Organisational structures and functions
4. Organization structure defines the hierarchy in a company, how
workflow happens to achieve the company goals
5. Good organizational structure helps in the below:
 Better communication and feedback
 Improves efficiency
 Better decision making
 Better staff engagement
6. Criteria for organization structure:
 Ownership
 Reach
 Evolution
 Age
 Client focus
 Production focus
 Main delivery channel
7. Organizational Structure types
 Hierarchal
 Functional
 Flat or Horizontal
 Divisional
 Product Line
 Geographical
 Matrix
8. Functional structure
Pros: specialisation, clarity about roles, accountability, reporting structure is
very clear, Scalable, Operational efficiency, Encourages employees to specialize
their skillsets, Empowers employees to focus on their specific role and
responsibilities, Empowers teams and departments with clear, specific goals that
they can work towards.
Cons: Closed communication, resistance to change, slow coordination & lesser
chances of cross departmental collaboration, gap between top and bottom,
bottom to top feedback might not flow, formation of siloed departments
9. Divisional structure
 Divided into divisions based on product, geography, customer based or
product.
Pros: can respond to changes in the local market faster, drives innovation,
understand individual markets better, flexibility
Cons: Duplication, lack of orgn. Communication, lack of hierarchy
understanding, competition
Product based
Pros: company can cater to customer based on their needs, positive competition
between depts. Better control for each division as separate cost Center
Cons: Duplication of services, loss of central control on each cost Center,
negative effects of competition
Geography based
Pros: can attend to local needs, effective communication with local customers,
positive competition
Cons: conflict between center and local centers, duplication of resources and
functions
10.Hierarchal Tall structure:
Pros: excellent progression opportunities, managers have tight control over
employees, business areas closely managed
Cons: lack of autonomy leads to employee demotivation, slow communication,
slow implementation of organizational changes
11.Horizontal Flat structure;
In a flat organizational structure, there are few middle managers between
employees and top managers. The structure requires less supervision, increases
employee involvement, and boosts trust in the workplace.
Pros: give employee more responsibility, more efficient employees as they are
motivated, faster decision making, faster creative practices and implementation,
more open communication, more autonomy and responsibility.
Cons: confusion over reporting lines, is not scalable, employees have
generalised skills, lack of progression, high workload for managers, span of
control and workload for manager is high being one decision maker, leading to
mgmt. burnout
12. Matrix structure
Pros: projects can be finished faster based on priority, more opportunities for
employees to learn and grow, better communication and collaboration, increased
employee morale, faster projects deliverables
Cons: team conflicts regarding roles and responsibilities, project manager and
dept. head conflict, heavier workload, employee performance measurement is
difficult, slow decision-making process, confusion on authority, frequency of
change can take its toll.
13.Why would a business change its orgn. Structure?
 Black Swan events like Covid
 Change in industry or customer requirements
 To increase productivity
 Competitors
 Finance increase
 Product change
 M&A
 Change in leadership or strategy
 New technology
14.CIP- Continuous improvement process- kaizen- lean , six sigma
15.Why would orgn. Change its structure
https://www.techtarget.com/searchcio/feature/Why-structural-change-
in-an-organization-is-key
https://change.walkme.com/organizational-structure-change/
https://smallbusiness.chron.com/causes-structural-change-within-
organization-436.html
https://www.processexcellencenetwork.com/organizational-change/
columns/why-organizations-change-and-what-they-can-change
16.How is strategy related to customers, products or services?
https://www.theaspteam.com/blog/understanding-strategic-business-
drivers
https://customerthink.com/how-customer-strategy-relates-to-business-
strategy-and-customer-culture/
https://countingup.com/resources/how-do-customers-influence-a-business/
https://www.managementstudyguide.com/strategy-definition.htm
https://www.linkedin.com/pulse/connections-between-organisational-
strategy-revenue-ridip-bordoloi/
17.Terminology in an organization:
Vision- Mission- Purpose-Values-Culture- Strategy- SMART Plan/ Business
Planning- Stakeholder Management
a) STAKEHOLDERS comprise any individual or group of people within
an organisation who may have an interest in its activities.
b) The organisation’s VISION is a representation of what the future should
look like for the whole of the business.
c) The MISSION STATEMENT is an organisational statement that will
provide the business with firm guidance when making management
decisions.
d) A STRATEGY is the broad programme/guidelines that the organisation
will follow to achieve its objectives.
e) GOALS are the desired measurable results and outcomes from
implementing strategy.
f) VALUES are part of organisational culture and will develop formally or
informally. They refer to what is believed to be important about how
people and the organisation behave.
g) Organisational OBJECTIVES are short term and specific and are often
described by the SMART Acronym (Specific, Measurable,
Achievable/Agreed, Realistic, Timely/Time Specific).
18.Tool to understand the internal organizational environment: SWOT
Analysis
19.Tool to understand the external organizational environment:
PESTLEE Analysis
20.According to MacLennan (2011), strategy should drive the scope
and range of products and/or services offered, channels used, and
markets targeted. Efforts should be made to explore ways of
expanding customer markets by broadening the marketing scope
and budget, customer loyalty programs, diversification of
products/services etc.
21.The diagram above helps to illustrate the many links between external
factors impacting on organisational strategy as well as the relationship
between the organisation and its products and services, its suppliers,
customers and (in some cases) its distributors. You will notice another
application of the two common strategic planning tools – SWOT and
PESTLEE/STEEPLE. The process of undertaking this type of analysis
is also described as Environmental Scanning.
22. Organizational strategy :
Where are we now? Environmental scanning through PESTLEE &
Internal scanning through SWOT analysis
Where do we want to be? Vision, Mission, Goals
How do we get there? Organizational strategy
Features of Strategy
Strategy is Significant because it is not possible to foresee the future.
Without a perfect foresight, the firms must be ready to deal with the
uncertain events which constitute the business environment. Strategy
deals with long term developments rather than routine operations, i.e. it
deals with probability of innovations or new products, new methods of
productions, or new markets to be developed in future.Strategy is created
to take into account the probable behavior of customers and competitors.
Strategies dealing with employees will predict the employee behavior.
Strategy is a well-defined roadmap of an organization.
https://www.managementstudyguide.com/strategy-definition.htm
https://digitalleadership.com/blog/organizational-strategy/
#What_is_Organizational_Strategy
https://online.wlv.ac.uk/how-to-create-a-good-organisational-strategy/
https://www.compt.io/what-is-organizational-strategy-and-how-to-
incorporate-it-in-your-business
23.Types of organizational strategies:
a) Revenue/Sales Outcome: Who worries about this the most? Business leaders.
b) Service Outcome:Who worries about this the most? Service leaders.
24. What is organisational strategy?

Many different ones but Johnson & Scholes aboveIn other words, strategy is about:

a) Where is the business trying to get to in the long-term (direction)


b) Which markets should a business compete in and what kinds of activities are
involved in such markets? (scope)
c) How can the business perform better than the competition in those markets?
(advantage)
d) What external environmental factors affect the businesses' ability to compete?
(environment)?
e) What skills, assets, finance, relationships, technical competence, facilities are
required to be able to compete? (resources)
f) What are the values and expectations of those who have power in and around the
business? (stakeholders)
25. Organizational strategy types: corporate, business, functional, operational

Corporate strategies examples: Concentration,Diversification,No


Change,Profit,Investigation,Turnaround,Liquidation

Business strategies examples: Increase marketing budget,Rebrand,Investigate new


markets,Broaden exposure

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

26. Organizational strategy process

Step :1 Strategic objectives and analysis: Mission, Vision, Values. SWOT, PESTLEE, Portor,
Ansoff, staff and organizational readiness

Step:2 Strategic formulation- scenario planning

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

27. Porters Competitive strategies


a) Low Price Leadership Strategy: ikea
b) Differentiation Leadership Strategy; Apple
c) Integrated Strategy: low cost with luxury
d) E-commerce

28: Strategic planning

https://www.managers.org.uk/knowledge-and-insights/resource/developing-strategy/

28. Ansoff Matrix

https://www.business-to-you.com/ansoff-matrix-grow-business/

a. Market penetration: existing products in existing markets


b. Product development: new products in existing markets
c. Market development: existing products in new markets
d. Diversification: new products in new markets

29: BCG Matrix


https://www.business-to-you.com/bcg-matrix/

Dogs/ Cash cows/ question mark, stars

29. Horizontal integration

What Is Horizontal and Vertical Integration?

Horizontal and Vertical Integration are competitive business strategies.

• Horizontal integration is an expansion strategy adopted by a company that involves


the acquisition of another company in the same business line.

• Vertical integration (aka up/forward and/or down/backward) refers to an expansion


strategy where one company takes control over one or more stages in the production
or distribution of a product.

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.

Pros & Cons of Flat Organizational Structure: (Jacob Morgan, 2015)

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)

Stage 1: Strategic Analysis & Objectives

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.

Horizontal Integration: Through the acquisition of brands like Stradivarius and


Massimo Dutti, Inditex Group can offer wider range of product portfolio and reduce
market competition.
Business Model for Inditex Group
Stage:2: Strategy Formulation

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)

Stage 3: Strategy Evaluation

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)

Double Materiality Matrix (2022)

Stage 4: Strategy Implementation


Force Field Analysis: Zara- Pre-owned Platform for a Circular Economy -
Repair, Resale or Donate Zara products. (Zara website, 2024)

Stage 5: Controls

Milestones achieved :2023.

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)

Pillar:1: Unique fashion proposal- ensuring that Inditex continues to provide


quality and trendy fashion products to customers throughout the globe. Example:
Poplin collection by Stradivarius.

Pillar:2: Increasingly engaging shopping experience- ensuring that Inditex


customers enjoy seamless physical and digital store experiences. Example: RFID
security technology for Zara apparels.

Pillar:3: Extraordinary team-Internal employee promotion (72% of total


vacancies), Orientation program (Zara Coach & Hola training program established
in 50 markets) to establish the company as a benchmark employer.

Pillar:4: Sustainability, and responsibility: Promotion of circular economy


through Zara’s pre-owned platform, Sustainability Innovation Hub and usage of
sustainable materials in textiles (Eg. Loopamid)
BIBLIOGRAPHY

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:
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(Accessed 28 April 2024)
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benefits-and-disadvantages (Accessed 28 April 2024)
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leadership-in-a-flat-organization/ (Accessed 28 April 2024)
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0c12-43e4-9e33-103766d27821 (Accessed 29 April 2024)

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April 2024)
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April 2024)
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April 2024)
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fire-fulfillment (Accessed 29 April 2024)
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Available at: https://www.forbes.com/sites/kevinrozario/2023/06/07/inditex-
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