Organisational Change and Structural Design Order Instructions: Implications for organizations
The material you have studied this week begins to expand on the foundational theories of organizational design and strategic change management and to examine the ways that those theories can be implemented in the workplace.
The key concept that emerges from this material can be usefully summarised in the following statement:
Organizations can best prepare themselves for sustainable growth and development by managing according to a cycle of environmental change-adjusted strategy-revised structure-amended decision processes-enhanced organizational culture-environmental change. An organization that embraces this model will focus its managerial strategies on its core business model, the distribution of its resources in support of that business model and the ways in which it engages with its workforce in pursuit of its ambitions.
This Key Concept Exercise requires you to reflect on the degree to which your own organization, or an alternative organization with which you are familiar, has adopted a structure that meets the requirements of the philosophy expressed in the above proposition. To what extent does the organization’s current structure support a future in which continuous and iterative change is a dominant feature?
Organisational Change and Structural Design Sample Answer
The ever-changing environment calls for organizations to take no chances. The technological advancement, new legislation, competition, and other factor have compelled organizations to adopt new structures in order to survive. However, management is faced with challenges when choosing the best organizational structure to adopt. As management adopt a structure in the response of environment change it results to changes in organizational decisions, culture and affects the environment organization operates. The paper will focus on Iceland supermarket, a leading food retailer with over 860 branches throughout the UK and other franchised and owned in Europe (Iceland supermarket 2016)
The supermarket was started in 1970 by Malcolm Walker. They started by selling loose frozen food until they built their freezer and branded their products. The supermarket has adopted a functional organizational structure where workers are grouped according to the specific duties they perform. The organization has had a fair share of profits and losses. Iceland recorded massive losses in the year 2001 to 2004 but sprung to profitability from the year 2005 onwards (Iceland supermarket 2016).
The retail market for Iceland supermarket environment is characterized by competition, legislation which call for organization structure which can support the adjusting of strategies and decision making processes. Iceland supermarket faces stiff competition from other leading food retailers. For Iceland to compete in the market, strategies need to be formulated and implemented. Iceland supermarket functional organizational structure supports the adjusting of strategies. The structure is organized to departments such as marketing, finance and research and development. Departments such as research and development assess the market environment and formulate marketing strategies which will increase sales of company products. The strategies formulated by the research and development department are approved by the management when they access and consider them viable. The approved strategies are directed to the marketing department for implementation (Aghina 2014).
However, the functional structure is limited in supporting all strategies the organization will implement in the future. Iceland supermarket environment is hard to predict, ranging from new legislation and change of customers preference. The organization has opened branches outside the UK and has plans of opening in other places. The current structure will not be able to support the strategy. Adding new branches increases the number of employees which calls for a structure which will ensure smooth flow of information across the organization (Atkinson 2013).
Fabac (2010) notes due to the uncertainty of operating environment organizations are supposed to use adaptive business intelligence. Adaptive business intelligence helps the organization not to worry about the future by providing decisions which solve new demands. Due to an ever-changing environment, Iceland supermarket can adopt adaptive business intelligence to get decisions which will address new demands brought about by the changing environment. In addition, adoption of Adaptive Business Intelligence will help Iceland in getting timely decisions.
Mayfield (2014) argues the goal of the change is developing of new habits, however; the organization should follow certain approaches to assist in developing the new habits. Changes in organizations often compel the development of new habits to support the change. As changes in organization are inevitable, organization are required to adopt mechanisms and structures which support the development of habits and cultures which favor successful implementation of organizational changes.
The paper concludes by noting, Iceland supermarket has managed to undertake various strategies to be competitive in the market. However, uncertain environment calls for the organization to adopt a structure which will support the adjusting of strategy and amending of decision processes.
Organisational Change and Structural Design References List
Aghina, WS 2014 The past and future of global organizations Mckinsey quarterly, pp.1-4.
Atkinson, P 2013 Managing change and building a positive risk culture. Management Services , pp.9-13.
Fabac, R 2010 Complexity in organisations and enviroment- adaptive changes and adaptive decision making. Interdisciplinary Description of Complex Systems , pp.1-16.
Iceland supermarket 2016 The Iceland Story. Available from: http://about.iceland.co.uk/about-iceland/the-iceland-story/. [1 September 2016]
Mayfield, P 2014 ‘Engaging with stakeholders is critical when leading change’, Industrial and Commercial Training, vol.46, no. 2, pp. 68–72. doi: 10.1108/ict-10-2013-0064.