Managing People & Organisation
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INTRODUCTION
This paper is based on a real company and outlines the operations of the company, with the organizational goals pursued, followed by the analysis of the people working in the firm to support the facts leading to prove that people tend to pursue their own goals, using the organization for their own ends. Kindly consider all information as confidential.
Company Background
Aptec Distribution is a leading focused broad line IT distributor, providing IT resellers with a complete range of leading IT telecommunication products and services. The Organization employs more than 400 employees and has 8 subsidiaries and locations in the UAE, Saudi Arabia, Kuwait, Egypt, Lebanon, Turkey, Iraq and Africa. Aptec Dubai was started in 1997 and employs close to 180 employees.
Organization Structure
The organizational structure portrays a companys processes and the style in which the tasks are divided leading to the creation of an organizational structure. Organizational structure is defined as “the set of formal tasks assigned to individuals and departments” “formal reporting relationships, including lines of authority, decision responsibility, number of hierarchical levels, and span of managers control” [The New Era of Management, Richard L. Daft, Chapter 10, Pg. 351]
When the company was newly established, there was only a limited team of twenty-five employees, of which eight sales staff (covering Middle East) reported directly to the General Manager himself!
Slowly and surely, the company builds a good reputation, thus making substantial profits, thereby growing immensely and recruiting new staff. Currently APTEC employs twelve members in the sales, catering to the UAE Region only and others covering the MESA region.
Due to the fast-paced growth, the General Manager introduced certain rules and regulation to bring order to the organization. This resulted in the appointment of the Sales and Marketing Manager. Thus, centralization was achieved by the sales team reporting to the sales and marketing manager and all decision making would be taken by the management team consisting of the General Manager, the Sales and Marketing Manager and the other department heads.
In order to streamline operations and better co-ordination and communications, the organization adopted a matrix approach, as the company was divided on the basis of Region (such as UAE, Upper Gulf), Product (such as HP, Microsoft) and Customer Division (Corporate/Value Added Resellers, Wholesalers, Dealers, Retailers). A dual line of authority involving a functional hierarchy and a divisional hierarchy in terms of the various Product Managers handling different Product Lines and the various functional heads such as Finance, Logistics, Purchase, Sales, and Administration existed within the organization.
The matrix approach has its own setbacks, as the dual chain of command would tend to create conflicts between the inter-department heads as they would work towards their individual goals and lead to a clash between the functional and divisional department, whereby neglecting the companys group objective.
Stephen P. Robbins throws light on this by stating: “Additional commonalities among most conflict definitions are the concepts of opposition, scarcity, and blockage and the assumption that there are two or more parties whose interests or goals appear to be incompatible. Resources – whether money, promotions, prestige, power, or whatever – are not unlimited, and their scarcity encourages blocking behavior. The parties are therefore in opposition. When one party blocks the goal achievement of another, a conflict state exists.”
In order to prevent future inter-departmental conflicts, the company introduced a Task Force.
“A task force is a temporary team or committee designed to solve a short-term problem involving several departments. Task Force members represent their departments and share information that enables coordination.” [The New Era of Management, Richard L. Daft, Chapter 10, Pg. 370]
A permanent team was established, consisting of the department heads, meeting weekly to discuss and resolve problems, in order to create a coercive environment and smooth functioning of all departmental activities. This proved to be successful as mutual problems were highlighted and solution sought to eliminate such problems from reoccurring. The meetings, at times, would prove to provide brain-storming sessions, thus allowing innovative and creative ideas on how to improve a system benefiting the whole organization.
Organizational Culture
The Company had no defined culture when it started out but as the company expanded, the management had to exercise control and power leading to a formal culture in place defined by set of rules and regulations. The formal structure caused a shift of management style. This led to increased job insecurity and dissatisfaction amongst employees, as no significant reward system, promotion criteria or upgrading of job skills, was present. Many employees left for better prospects or decreased productivity, creating an environment wherein the employees were trying to fulfill their needs at the expense of ignoring the companys goal and objectives.
Charles Perrow explains, “One answer is obvious enough: there is a never-ending struggle for values that are dear to participants – security, power, survival, discretion, and autonomy – and a host of rewards. Because organizations do not consist of people who share the same goals, since the members bring with them all sorts of needs and interests”
The phase during which there was a high-rate of employee turnover at Aptec Gulf resulted due their ego or rather their self-actualization needs not being fulfilled. The employees were not getting any form of appreciation for the work performed nor provided with the opportunity of a growth prospect. This was leading to the employees being dissatisfied with the extrinsic conditions that had been created.
McGregor interpreted ego needs as:
Needs relating to ones self-esteem such as self-confidence, independence, achievement and knowledge
Needs relating to ones reputation such as status, recognition, appreciation,