Organizational Structure Case Study

Question 1:

Organizational structure refers to the way that an organization arranges people and jobs so that its work can be performed and its goals can be met. When a work group is very small, and face-to-face communication is frequent, formal structure may be unnecessary, but in a larger organization decisions have to be made about the delegation of various tasks. Thus, procedures are established that assign responsibilities for various functions. It is these decisions that determine the organizational structure.(1) (Lewis, 2003)

There are many types of organizational structure such as functional structure, Matrix structure or divisional structure. Any company can use any type organizational structure according to its objectives and aims.

Problems of running businesses structure less:

The businesses that does not have a strong organizational structure face a lot of problems, from all the problems we will discuss some of them:

1-Lack of Innovation: Companies with bad organizational structure are very slow to innovate, they have a very poor communication between themselves which mean that the idea never reaches the right source for development, workers who come up with new ideas may keep them to themselves.

2-Lack of Team Work: Bad organizational structure does little to encourage the concept of teamwork. Departments may be opposed or unable to cooperate with each other, and workers within departments may not feel a sense of camaraderie. Workers may focus on their individual tasks and not offer assistance to others unless directed to do so by a supervisor.

Features of Starbucks Coffee’s Organizational Structure

Starbucks has a matrix organizational structure, which is a hybrid mixture of different features from the basic types of organizational structure. The following are the main features of Starbucks Coffee’s organizational structure(3): (koehn,

goal-oriented: The focus is on the way people do work and an emphasis on avoiding risk. On the opposite end of the spectrum, a goal-oriented culture identifies with what work gets done.(6)

• Internally vs. externally driven: Employees within an internally-driven culture see themselves as experts; they feel they know what is best for the client and customer and act accordingly. On the other side, employees working in an externally-driven culture are very customer-oriented and will do whatever the customer wants.(6)

• Easygoing vs. strict work discipline: In an easygoing culture, the approach to work is informal, loose, unpredictable, and these characteristics facilitate a high level of innovation. In a strict culture, there is a fair amount of planning, which leads to efficiency and productivity. (6)

• Local vs. professional: In a local organizational culture, employees identify with their boss and their teammates. In a company with a professional culture, employees identify with their profession or the content of the work. (6)

• Open vs. closed system: In an open system, newcomers are welcomed easily. People are inclusive and take the approach that anyone will fit in well with the organization. A closed system is more exclusive, where newcomers have to prove themselves.