North Pole Hoops Organizational Analysis
Most organizations are almost shutting down due to the coronavirus pandemic that has affected nearly all businesses worldwide. Sports-related companies are among the most affected firms since various sports events were either suspended or canceled. North Pole Hoops is one such organization. The company is headquartered in Canada. It is now one of the most recognized basketball platforms in the country. Almost all its players are high-quality basketball professionals hence elevating Canada as a force for the National Basketball Association. Although all sports events’ suspension was a big blow to the company, its distinctive organizational culture will ensure its survival.
Organizations aim to be successful in their activities. Companies with this ambition must have a clear mission (Bogdan, 2019). An organization must have a clear purpose for its existence; it should define its objectives, values, and desired future position. North Pole Hoops’ mission is to support Canadian basketball by providing the youth with opportunities to reach the highest levels and obtain scholarships. The clearly defined mission statement has helped the organization align its activities towards its attainment (Bogdan, 2019). It provides a growth mindset for student-athletes starting at the age of ten until their high school careers. The organization understands that raising a child is a collective responsibility; thus, it collaborates with clubs, national programs, and school coaches to maximize Canadian basketball prospects’ potential.
The organization is private and was formed due to a partnership between two brothers, Tariq Sbiet and Elias Sbiet. The type of business is beneficial to individuals as it allows access to a broader range of expertise. Besides, the right partner brings knowledge and experience that one may be lacking or complementary abilities to help in the growth of the business. For example, a person may be great at selling ideas but unskilled in building relationships; a partner with awareness will help fill that gap. A prospective partner can also bring more finances into a business. Moreover, they may have more strategic connections. Thus, the organization will attract potential investors and increase its capital base. Having a business colleague allows one to share the financial burden needed for business operations, resulting in more savings (Miller, 2016). The partnership offers the right work balance; the partners may work in shifts, allowing each of them to take a break. Partners may also enjoy moral support from each other. Nonetheless, the business structure has some shortcomings. Partners share losses and liabilities for any debts, even if incurred to only one of them. The situation is a burden to a person’s assets. A partnership lacks autonomy. One must always consult their colleague before making decisions (Miller, 2016). Additionally, differences in opinions can result in conflicts. A partnership requires an exit plan that can deal with issues such as bankruptcy and clear guidelines for selling the enterprise to a third party.
North Pole Hoop has employed over two hundred and seventy-five employees, including editorial staff who provide coast to coast media coverage on Canadian basketball. Since it was founded, the organization generates slightly above one million dollars in annual revenue. Its operations are currently limited to Canada, but there are plans to extend its scope to neighboring countries as its revenue grows.
The company uses quality control in its main operation of training youngsters to become professional basketball players. When talking about an intangible good, it is often difficult to define and quantify quality. Quality control elicits the achievement of competency, leading to desirable results. Moreover, it thoroughly evaluates young talents and motivates them to gain more interest in basketball. The organization is committed to the overall wellbeing of the students.
The organizational structure adopted by the company is hierarchical. It relies on having different levels of authority within a chain of command. Moreover, it has a formal decision-making process that flows from top to bottom. North Pole Hoops’ structure includes the mainboard, which is the highest level. It offers support and guides the executive team. The operational level is responsible for running the daily activities of the organization. The business partnership directorate appears below the executive team. Its primary function involves helping the existing partners get the needed assistance and information concerning basketball sports. The community sports directorate is mandated with attracting more youngsters to basketball. The facilities and planning directorate build and conserve the needed architecture to play basketball games; it advices on facility design. The research and strategy team evaluates what motivates people towards basketball and what demotivates them; the team examines the personal experiences of people associated with the sport. Each administration level has well-defined lines of responsibility and control; thus, there is accountability for decisions at various levels of management. The structure is a powerful system capable of motivating general company behavior and individual performance; employees have clear opportunities to specialize and become experts in their areas of duty. It also nurtures a culture of allegiance towards departments, teams, and the organization in general. This structure’s downsides include a complicated chain of command that slows down decision-making and inconsistency in management at different stages. Organizations are likely to experience delays in vertical and horizontal communication. There is a disconnect of workers from the top management. Additionally, the structure is less flexible in adapting and reacting to environmental and market pressures.
All organizations need to have clear guidelines for handling liquidity issues, which can arise from seasonal fluctuations, business disruption, and unplanned revenue reduction. In the unfortunate circumstance that a business faces a cash flow crisis, it risks being insolvent and incapable of meeting its fiscal expansion plans. North Pole Hoops has adopted various measures to address liquidity. The company makes regular cash flow forecasts. Since the company is not experiencing any cash flow crisis, it does a long-term cash flow forecast to support its goals and offer financial details for proposed projects. The forecast is centered on the longevity of the company. The organization also does frequent monetary stress tests to forestall different possible liquidity crisis. It incorporates short-term and long-term situations that detect origins of liquidity tension and that ensure all exposures support the company’s liquidity risk tolerance. The organization has also developed a contingency backing plan that enunciates its strategy for handling liquidity issues. The company manages cash collection by ensuring accuracy in all customer invoices and conducting a yearly review of the information. The firm uses more fixed assets than variable ones in its operations. Thus, operating leverage is likely to be high. High operating leverage allows companies to make more money if they do not incur costs to produce more sales. As the business grows, fixed assets can do a lot more without additional charges.
The basketball firm is an oligopoly as there are only a few firms compete for the same market. Interdependence is a crucial feature of the market structure. Firms make decisions based on what the competitors are doing. For example, if a firm starts advertising its products, the act will surely evoke a counteractive reaction from other firms (Azar & Vives, 2018). Thus, organizations in an oligopolistic market experience stiff competition since one firm’s move affects the rivals. Competitors in the sports industry are already up to date with emerging trends like e-sports. Although the structure lacks entry barriers, new firms may experience challenges when trying to venture into the market; they include economies of scale enjoyed by large firms, exclusive patents, and control over essential inputs (Azar & Vives, 2018). Also, there is a lack of uniformity in the companies; it incorporates both large and small firms.
Marketing is an essential tool in attracting customers and increasing sales. The company has very robust marketing strategies. For uses contests as one of the most efficient ways to promote itself. Games make customers excited about what a business is about to offer (Shank & Lyberger, 2014)
. Sponsorship is a very effective way of generating brand awareness; they add credibility to the brand and elevate a small firm into a global company. The organization is popularly known for sponsoring students in Canada. Creating engaging content attracts more clients, especially with celebrity figures (Shank & Lyberger, 2014). The firm has an easily accessible website that it uses to engage with basketball fans. Moreover, the firm is very active in almost all social media sites.
In conclusion, the way a business structure its activities are very crucial for its overall success. The first step is to have a mission that will align these activities to its goals. A mission statement serves as the leading guide for any organization. Many students have benefitted from scholarships in Canada, owing to the strict adherence of North Pole Hoop’s mission. Moreover, the use of quality control has aided the company in producing very professional basketball players. Although its structure has a few disadvantages, the hierarchical system has generally motivated its staff. The organized manner in which the firm operates has helped it deal with liquidity issues, remain afloat in the highly competitive oligopoly market, and adopt very efficient marketing strategies.
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