UNIVERSITY OF TECHNOLOGY, JAMAICA

SCHOOL OF BUSINESS ADMINISTRATION

MODULE NAME: INTRODUCTION TO MANAGEMENT

Tutorial Sheet 8 - Structure and Fundamentals of Organizing

CASE STUDY ONE

Zappos: Redefining the Workplace with Holacracy (Adopted from Why is Zappos’
culture of holacracy catching on?)

Zappos, known for its exceptional customer service and vibrant company culture, made a
radical shift in 2013 by adopting Holacracy. This unique organizational structure replaces
traditional hierarchies with self-organizing teams called "circles," granting employees more
autonomy and decision-making power.

Holacracy aligns with Zappos' focus on employee engagement and customer satisfaction. By
encouraging self-management and distributed leadership, it fosters innovation and adaptability.
The open work environment further promotes collaboration and knowledge-sharing.

Key features of Holacracy include:

 Self-organizing teams: Employees take ownership of their roles and decisions, leading
to increased accountability and a sense of purpose.
 Distributed leadership: Leadership is not tied to a position but emerges based on
expertise and initiative, promoting a more inclusive and dynamic environment.
 Open communication: The emphasis on transparency and open dialogue fosters
collaboration and facilitates conflict resolution.

Zappos' implementation of Holacracy has drawn considerable attention, highlighting the

potential benefits of self-management and challenging traditional notions of organizational
structure. While not without its challenges, Holacracy's emphasis on employee empowerment
and adaptability positions it as a compelling model for organizations seeking to thrive in a
rapidly changing business landscape.

QUESTIONS

1. How does Zappos' adoption of Holacracy challenge traditional definitions of

"organizing" and "organization structure"?

2. Would you categorize Zappos' Holacracy structure as tall or flat? Centralized or

decentralized? Justify your answer.

3. How are the traditional organizational chart features like work specialization, chain of
command, and span of management impacted or redefined in Zappos' Holacracy
model?
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 4. Even within a Holacracy, some level of departmentalization and functional organization
is necessary. How might Zappos achieve this while maintaining the principles of self-
organization?

5. How does Zappos' Holacracy structure contribute to its strategic goals of providing
excellent customer service and fostering a strong company culture?

CASE STUDY TWO

Tucker Company: When Collaboration Clashes

In 1993, Tucker Company underwent a major restructuring, creating three independent

divisions based on their primary product lines. Each division was equipped with its own
functional departments, aiming to enhance efficiency and accountability. However, some
shared services, like the company-wide laboratory, remained.

Initially, the lab, led by Mr. Garfield, operated smoothly despite its administrative reporting
line to the military jet engine division. This changed with the arrival of Ms. Jones, the new lab
manager. Jones, ambitious and eager to make her mark, sought a more proactive role for the
lab, leading to clashes with other departments, particularly engineering.

Mr. Garner, an engineer from the utility turbine division, resisted Jones's attempts to influence
material selection and experimental design. He maintained that the final decision rested with
engineering, citing Jones's lack of design expertise. Jones countered, highlighting her
metallurgical knowledge.

Additionally, Garner grew frustrated with delays in his project requests, which Jones attributed
to prioritizing the military jet engine division's work due to the reporting structure. She
suggested closer collaboration to better understand project urgency, but Garner was
unreceptive.

Tensions escalated when one of Garner's critical projects faced delays. During a heated phone
call, Garner asserted that Jones's role was solely to conduct tests as requested and expressed
dissatisfaction with the low priority given to his division's work. Jones reminded him of her
earlier suggestion for collaboration, which he had dismissed. The conversation ended abruptly.

This case highlights the challenges of balancing autonomy and collaboration in a reorganized
company. The conflict between Jones and Garner reveals a misalignment of expectations and
communication breakdown, exacerbated by the administrative reporting structure. It raises
questions about the effectiveness of the new organizational design and the need for improved
interdepartmental relationships to achieve the company's goals.

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Questions

1. Sketch out a simple organization chart showing Tucker company’s three divisions, including the
location of the laboratory. Why would the lab be in the military jet engine division?

2. Analyze the conflict between Ms. Jones and Mr. Garner. Do you think the conflict is based on
personalities or on the way in which the organization is structured?

3. Sketch out a new organization chart showing how you would restructure Tucker Company so that
the laboratory would provide equal services to all divisions. What advantages and disadvantages do
you see in the new structure compared to the previous one?

Discussion Questions
1. Define Span of Management. What was the original acceptable number of people? Has this
number changed? Why?

2. Describe and contrast flat structure and tall structure.

3. Explain Centralization and Decentralization, contrasting their characteristics and the factors that
influence each.

4. What is departmentalization? Explain the different approaches: vertical, divisional, Matrix, Team-
based and Network, stating what they are and how they work. What is the difference between the
functional approach and the divisional approach.

5. What are the advantages and disadvantages of each approach?

6. Sandra Holt, manager of Electronics Assembly, asks Hector Cruz, her senior technician, to
handle things in the department while Sandra worked on the budget. She needed peace and
quiet for at least a week to complete her figures. After ten days, Sandra discovered that
Hector had hired a senior secretary, not realizing that Sandra had promised interviews to
two other people. Evaluate Sandra’s approach to delegation.

7. Many experts note that organizations have been making greater use of teams in recent
years. What factors might account for this trend?

8. An organizational consultant was heard to say, “Some aspect of functional structure

appears in every organization.” Do you agree? Explain.

9. The divisional structure is often considered almost the opposite of a functional structure.
Do you agree? Briefly explain the major differences in these two approaches to
departmentalization.

10. What is the virtual network approach to structure? Is the use of authority and
responsibility different compared with other forms of departmentalization? Explain.

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 TRUE or FALSE

1. A structure graph is a visual representation of an organization's structure, showing

communication and lines of power.

2. People in management positions have formal authority to direct and control immediate
subordinates.

3. A tall structure is a management structure characterized by an overall narrow span of

management and a relatively large number of hierarchical levels.

4. Quick response to external changes is an advantage of vertical functional structure.

5. The functional structure is sometimes called a product, a program, or self-contained

unit structure.

6. The divisional structure encourages decentralization.

SHORT ANSWER QUESTIONS

7. The deployment of organizational resources to achieve strategic goals is known as

_______.

8. The framework in which the organization defines how tasks are divided, resources are
deployed, and departments are coordinated is called .

9. The visual representation of an organization's structure is called the .

10. Division of labor is also known as _______.

11. The degree to which organizational tasks are subdivided into individual jobs is called
.

12. The is an unbroken line of authority that links all persons in an organization
and shows who reports to whom.

13. When each employee is held accountable to only one supervisor, it is called ______.

14. The ______ refers to a clearly defined line of authority in the organization that includes
all employees.

15. The three characteristics of authority are that it must be ______, ______, and ______.

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16. is the formal and legitimate right of a manager to make decisions, issue
orders, and allocate resources to achieve organizationally desired outcomes.

17. is the duty to perform the task or activity an employee has been
assigned.

18. means that the people with authority and responsibility are subject to
reporting and justifying task outcomes to those above them in the chain of command.

19. is the process managers use to transfer authority and responsibility to

positions below them in the hierarchy.

20. ______ departments perform tasks that reflect the organization’s primary goal and
mission, while ______ departments include all those that provide specialized skills in
support of ______ departments.

21. means that people in management positions have formal authority to

direct and control immediate subordinates

22. The is the number of employees reporting to a supervisor.

23. A(n) ___ structure has a wide span, is horizontally dispersed, and has fewer
hierarchical levels.

24. With , decision authority is pushed downward to lower organization levels.

25. _______ means that decision authority is located near the top of the organization.

26. A(n) ______ structure has an overall narrow span and more hierarchical levels.

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