Business Studies – Organisational Structure
Evaluate the consequences for Poppies if de-layering is allowed to take place (16 Marks)
De-layering is the process of removing levels from within a business. The primary reason for doing this is to reduce costs, however there can be many consequences if de-layering takes place.
Some positives could be that in the long term removing a layer from a business should lead to reduced costs. The reason for this is that you will no longer have that layer of your business on your payroll meaning you will not need to pay them a wage any more. The flip side of this is that in the short term you may need to pay the workers of the layer you removed a redundancy pay.
Removing a layer of a business can also be seen as a method of making your business smaller. This is the opposite of what Tim wanted to do with his plans for expansion. Conversely, de-layering may lead to Tim needing to hire new staff for new job purposes. This would be expansion and would also give Tim the chance to hire “enough staff of the right quality”, something he was previously worried about. However as I have said, de-layering should in the long term reduce costs and so increase chances of finance towards expansion.
Another effect of de-layering is that it increases the decision making process and decreases the channels of communication. This means that as there are less people to go through and thusly less people to confirm what needs to happen with. Because of this efficiency should be improved within the business when orders are given.
The negative aspects must also be considered. Arguably one of these is that employees would be given more responsibility and more authority, something that Tim specifically wanted to av...
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...en by either the managers of the outlets, or by retraining the outlet staff assistants. This would however incur a cost as you would have to pay redundancies, but it would be a lot smaller than if you were to remove the buyer’s layer. Also it may incur the cost of having to retrain either the managers or the outlet staff assistants on how to do the role of the supervisor and they may demand more pay.
Overall I feel that it would be best to de-layer the business and to do so by removing the supervisor’s layer. This is because it would incur a smaller cost financially to remove this layer and lead to more pro’s such as a quicker decision making process and hopefully a more efficient business. Though I would also suggest to Tim that he allow smaller decisions such as whether an outlet is allowed to re order new stock, be down to the managers of the individual outlets.
East Park Restaurant operates using a hybrid (mixture of vertical and horizontal) organizational structure where Boos reports to the company’s owners. Assistant managers and front...
Negative Results. The negative outcomes of consolidation are often seen in the financial and public relations aspect of consolidating. One of the most prominent and controversial as...
Downsizing, restructuring, rightsizing, even a term as obscure as census readjustment has been used to describe the plague that has been affecting corporate America for years and has left many of its hardest working employees without work. In the 1980’s, twenty-five percent of middle management was eliminated in the United States (Greenberg/Baron 582). In the 1990’s, one million managers of American corporations with salaries over $40,000 also lost their jobs (Greenberg/Baron 582). In total, Fortune 500 companies have eliminated 4.4 million positions since 1979 (Greenberg/Baron 627). Although this downsizing of companies can have many reasons behind it and cannot be avoided at times, there are simple measures a company can take to make the process easier on the laid-off employees and those who survive with the company.
The disadvantages of union membership are viewed from the employee and employer perspective. Through the employee lens, the disadvantages manifest in the form of fees, loss of autonomy, and less collaborative work environment. As part of the union, you surrender many of your individual rights in exchange for the organized results that can potentially manifest through the collective bargaining process. Therefore, there isn’t any assurance that your individual concern will even be addressed.
Organizational changes that reduce cost. The M&S reduced its management levels to reduce the cost.
The Destroy Your Business strategy (DYB) entails a strategic plan developed, and implemented by the company leadership, and employees. The plan is to destroy a company 's weaknesses, as well as business units that are less beneficial or do not add value to the enterprise 's performance. The DYB strategy is essential in the sense that if a company does not identify and crush its weaknesses, competitors will use those weaknesses to their advantage. On the other hand, the Grow Your Business strategy (GYB) entails finding innovative ways of reaching new clients and better ways to serve the existing ones. Thus, the DYB strategy helps in completely disrupting the current practices of a business
Other controls such as bonding and requiring employees to take vacation or changing their job position
...enough research on it. Some drawbacks are less employment security, a loss of pay due to the profit-sharing model, and there is evidence of some firms engaging in downsizing and layoffs who have adopted HPW. There is also evidence that implementation of HPW systems in lower-tier service jobs results in negligible differences in any of the above categories. Only in the upper-tier services can more of the benefits of this model be had, which unfortunately leads to potentially greater market segmentation (Krahn, Lowe, Hughes, 2011 p. 267-268).
The result of treating employees better and giving them better hours is that then to keep production at the same level the factory owners would have to hire more employees. Hiring these extra employees would cost them money and would be counter-productive when they could produce the same amount while paying your employees less and having them work longer hours. It is illogical to treat your employees better than your competitor if it will decrease your production. Another argument against these reforms was that to comply the companies would have to purchase door that swing outward, sprinkler systems, better fire escapes, etc. [Insert information about if it’s the responsibility of the government to protect the employees or the rights of the companies to compete in the
The current circumstances have made us re-think about the governance of our company. To resolve certain issues like spread of our businesses, incompetent management, improper structure and high attrition rate has been addressed here. The strategic options evaluated are Divesting from some of the businesses, Re structuring the management by giving generalised top management or using specialized management. The options are evaluated on the basis of cash position, future projection, Repute preservation and efficient functioning of management. On the basis of these, I recommend to divest from irrelevant and non-performing businesses. This will ensure company’s smooth running and sustained profitability.
Diversification is where a company grows into new business areas either similar to existing business or different from existing business allowing a firm to create value by creatively using excess resources. Seprod operates in a number of different and distinctive product markets and several businesses using corporate-level strategy. Seprod operates in the fats and oil business, milk and juice and the sugar industry
For each order there should be a purchase requisition that is filled out and sent to the purchasing department. The purchasing department should review and sign off on the order. Once approved and the purchase order is sent out a copy of the purchase order should be sent to the receiving department with the quantities blacked out. This way when the order comes in the receiving department will actually count the inventory rather that look at the total on the purchase order and not count to verify. Once the order is verified the invoice should be sent to the accounts payable department, so the vendor can be paid. By having this segregation of duties it helps Starbucks limit the opportunity for non-legitimate orders from being placed and paid for. Another control that Starbucks should have around inventory and the physical counting of inventory that is stored in their warehouses. This should be done at least once a year at year end, and it would be even better if Starbucks could do bi-annual inventory counts to ensure their inventory is being accurately
Durke Asset Management SA (nd), The benefit of diversification, Management Mandate Philosophy, viewed 24/1/2012, < http://www.dukre.com/media/en/E5A1BF79-2F6A-4377-8566-316F1634D738/Benefits%20of%20diversification.pdf >
All of this is proved but still management and employees of many companies resist this change. Major reasons why people resist this change are: - 1) fear of failure 2) disruption of interpersonal relationships 3) personality conflicts 4) politics
Managerial decisions are an important component in achieving the objectives of the organization. The success or failure of a business depend upon the decisions made by managers (Jurina, 2011). Today’s increasing complexity in the world of business brought forth greater challenges for both the firm and its managers. The rapid rate of technological and digital advance as well as greater focus product innovation and processes that influence marketing and sales techniques have contributed to the increasing complexity in the business environment.