Foundation of Management
Management of an institution has many processes. The Shutterstock company having been among the most successful businesses, employed the idea of collaborative experimentation. The aim was to boost the products and instill a progressive, innovative mental culture in the company. (De Sousa Pintassilgo et al., 2019, p.153)The main benefit of the process was eliminating the ‘highest paid person’s opinion’ that would encourage the testing of ideas without depending on other people’s opinions or instincts. Another benefit of the concept put in practice is to cultivate curiosity. In an organization, all employees from the leadership to the low-level employees have different mindsets. When these differences in mindsets are identified, and explored failures are viewed differently, as learning opportunities and not mistakes. (Hart et Al.,2019,p.7) When a company employs the experimentation culture, it is under the fear of failure; hence the employees are open-minded, curious, eager to learn, and ready to figure things out; therefore stands a better chance of improvement.
Cultural experimentation encourages ethical sensitivity. Companies fall under the test of susceptibility of ethical issues as testing of new ideas should check whether they are moral to the society. When companies test new ideas, they run a more significant advantage of success than those that directly implement ideas without experiments. Through this, A/B tests proved to be more questionable morally compared to the directly applied untested practices. The experimentation is considered vital as it encourages the employees to inquire whether a method would be of benefit or harm to the people. Institutions should encourage debates on the benefits of a product and seek customer reviews before distributing products to ensure they are morally acceptable.
Every good thing also has a negative side. The disadvantage of cultural experimentation is poor communication that develops among employees. As employees try to present their ideas for testing, team chemistry is lost within the institution. (Thomke, 2020,)A good culture should be prepared with friendly and open communication among employees to ensure a better flow of ideas. When connections are lost, it becomes difficult to share; hence sharing of ideas becomes challenging. Another disadvantage of cultural experimentation is competition. The competition can be healthy when it is channeled towards achieving a common goal and is healthy among members. When the competition becomes toxic with employees trying to outdo each other hostile relationships develop, and productivity is affected. Experimentations also lack a valid explanation. Experiments are trials that may end in success or failure; hence no assurance that the process may go as planned. The cultural experimentation thus does not have an actual explanation. The testings’ are highly subjective since there is a risk of human error (Clarke, 2019, p.90). Particular standards of variables are required to control any human error possibility at any point in the experiment. The validity of the test can be established through a close evaluation of each step as research is ongoing to give information about the outcome. The trials are also very time consuming as different variables need to be tested before a product is openly released to the customers.
Adopting cultural experimentation has various risks that tag along. There is a risk of becoming relevant to customers. Customers are the focal point of a business, and any factor that hits the customer count may drastically affect the market. The customers’ demands are continually changing with the evolving technology doing enterprises to go out of their way to keep up. When there is no development in an institution, customers are lost as the business becomes irrelevant, thus the risk to experiment with different processes to ensure pace keeping with the changing technology and remain relevant in the market. Companies that are bold enough to overcome the fear of risk-taking and embrace experimentation can come up with more creative ideas that may benefit the business and stand a better chance at success as the different trials may meet customer expectations. Another risk with the employment of cultural expectation is the need to embrace a new leadership model. Experimentation is a practice of innovation and maybe a high risk if it involves a new product. When mot decisions in the organizations are made through the experimentation practice, then the top management becomes invalid as their job has already been handled. That raises risk as the senior management may have to be ruled out. A new form of leadership should be embraced that does not make the top control the decision-makers but pace setters to set up a challenge for the others to break down into testable hypotheses. The management should also have an open forum for discussion of ideas and experimentation of trustworthy ideas. Executives should have imitable characteristics for the rest of the employees, thus live by the same rules every other person lives by.
Case 2
After the Second World War, the Cole business changed its form of the organizational structure due to the rapid expansion. The Coles grocery was forced to shift from full-service stores to self-service stores whereby customers pick products on their own as the organization puts more focus on other activities such as the distribution systems, warehousing, and logistics. The organizational structure they took up was known as a divisional organization structure where the business splits control over different sections and operate as a company. (Garcia et. al, 2019, p.10)The structure aims at making operations more straightforward. The division structure, however, has two various forms, the market-based structure, and the product-based structure. The Cole business took the market-based organization structure as the consumer goods separate products to make it easier for self-service and easy reach of goods. The main advantage of the structure is that it helps big businesses stay flexible and gives room for quicker response to industry changes or customer needs as the customers can reach the products on their own compared to when they have to queue waiting on an attendant to serve others first. (Garcia et. al, 2019, p.8)The market based organizational structure promotes independence, self-government, and a well-customized approach. The structure despite all these has various disadvantages that should be avoided at all costs to ensure success of the business. Some of these limitations are that the structure can easily lead to duplicate resources since the employees are more focused on products they may end up investing in similar resources. In cases where the single business has opened other smaller branches to prevent overcrowding of customers in an only shop, there may be insufficient communication between the leading shop and the divisions. A decisive but challenging factor is that the company may end up competing against itself. (Barney, 2019) The self-competition is due to the focus directed on business operations that it only competes within itself with similar products and services, the only distinguishing factor maybe the customer flow. Divisions may also end up unintentionally duplicating services that other divisions are already offering. The best part of the structure is that the drop in one side does not weigh down the other. However, the multi-division plan leads to increased tax implication.
Question two
Cole grocery later adopted the use of the internet due to the growing technology. From the internet, Cole has gotten better opportunities for the business to explore the creation of value and expand its grounds gaining new ownership. The aim of the company is now on both customer satisfaction and initiatives on sustainability. The best organizational structure to adopt at this stage on the Cole business is the hierarchical organizational structure with a chain of command from the top management, such as the CEO down to the low-level employees. The advantage of such an arrangement is that each employee’s responsibilities are well defined, drawing lines at different levels of authority and responsibility. The distinction, I feel, is essential so that each employee has a specific area of focus that, when efforts are combined, achieves customer satisfaction and sustainability. (Barosi, 2019, p.373) That encourages decentralization where a selected team is responsible for decision making but also involves the low-level employees to build a sense of empowerment among the employees. The appropriate structure should be the flat or short hierarchical structures so that there is a better chance for supervisors to closely monitor employee moves. The structure shows the person to whom each employee reports concerning different projects. It is easier for employees who are career-oriented to walk their path as they are motivated to perfect their skills in the field and even stand an opportunity for promotion to a higher office of work. Through this, all employees have their own specialty spaces, thus creating a companionship between the employees within a similar department. The structure however, has the limitations to it that could be minimized. The hierarchical structure may slow down innovation or any changes that may be needed in the institution due to bureaucracy.(Barosi,2019,p.354) When the decisions are at one time made by the management at the top of the hierarchy, it takes longer to implement changes as the consultation down the pyramid consumes time. The organizational arrangement could also make the low-level employees lack a sense of belonging and feel they cannot express their ideas. The limitations can be handled by embracing teamwork and frequently checking on the employees’ welfare to ensure they are comfortable and motivated by their work.
References
Barney, J. and Rangan, S., 2019. Editors’ Comments: Why Do We Need a Special Issue on New Theoretical Perspectives on Market-Based Economic Systems?
Barosi, F., Gasparro, G., Cantu, G., Goldstein, J. and Ridolfi, L., Alixpartners LLP, 2019. Generating radial hierarchical network charts to convey organizational structures and associated performance data. U.S. Patent 10,373,354.
Clarke, R. and Burkett, I., 2019. Anticipating Precarity and Risk in Social Innovation Design for Entrenched Place-Based Disadvantage. Design and Culture, 11(1), pp.85-108.
de Sousa Pintassilgo, J.A., de Andrade, A.N. and da Silva Beato, C.A., 2019. Student Movement in Portugal Throughout the’60s: Actors’ Representations of a Period of Social and Cultural Experimentation. Espacio, Tiempo y Educación, 6(1), pp.145-159.
García de Soto, B., Agustí-Juan, I., Joss, S. and Hunhevicz, J., 2019. Implications of Construction 4.0 to the workforce and organizational structures. International Journal of Construction Management, pp.1-13.
Hart, N., Fichtner, J. and Smalligan, J., 2019. Improving Social Security Disability Insurance: Building a Culture of Innovation and Experimentation to Identify Future Reforms. Benefits Quarterly, 35(1), pp.26-7.
Thomke, S.H., 2020. Experimentation Works: The Surprising Power of Business Experiments. Harvard Business Press.