The Viability of the Current Organizational Structure of the Company Aquarius Advertising Agency - Case Study Example

? Case Study Analysis Contents Executive Summary 3 Analysis of the Current Structure of the Organization 4 Reasons for the inadequacy of the Vertical Structure 6 The Solutions 8 Increased coordination between the employees 8 Integrated Value Chain 9 Quick Decision Making 9 Increased employee motivation 9 The Learning Organization 10 Systems Thinking 10 Personal Mastery 11 Mental Models 11 Shared Vision 12 Team Learning 12 Bibliography 13 Executive Summary The company Aquarius Advertising Agency is going through tough times that have posed serious questions on the viability of the current organizational structure of the company. The major problems that have arisen in such a situation is the disgruntled attitude to the accounts executives, reduced customer satisfaction, lack of integration of functional processes, and lack of communication between the employees. The plethora of problems has made the administration of the company a nightmare. Under such desperate circumstances, the company executives should move from the vertical organizational structure to the flat organizational structure. Under this system, the coordination between the employees will increase, the functional processes will get integrated and the organizational goals will get aligned with the individual goals. Hence, this will result in Aquarius agency turning into a learning organization that will foster increased employee empowerment and increased customer satisfaction. Analysis of the Current Structure of the Organization Presently, the company is running under the tall structure of organizational hierarchy. According to this structure, there are three comprehensive departments such as marketing, Operations and Accounts. These major departments are supported by 2 one men departments that are, Human Resource and Finance. This structure was a best fit for the organization previously since it created provision for specialized tasks, well defined guidelines for the employees, proper job description for each employee and a high power distance. Due to the present tall organizational structure, there are few teams in the company and functions are characterized by centralized decision making procedures. These features of the organizational structure enable the higher management to wield power and take decisions in the most professional and judicious way (Daft, 1991). However, the present system is also creating a big cloud of problems as the clientele gets involved and communication gaps begin to widen up. The miscommunication between the cross functional supervisors due to mismanaged communication networks has led to employees being constantly disgruntled by the current functioning of the organization. It is quite evident that the account executive is fed up of the constant direct communications between the clients and the specialists like those of marketing and operations. These direct meetings between the clients and the organizational specialists led these employees to trespass their domains of authority and make decisions without consulting their executives. Since this phenomenon is not considered appropriate under the implemented organizational structure, this created serious problems in the value chain of the company and in the coordination in the business functions. This not only perturbs the organizational setting but also hurts the company reputation as the customers are unable to receive their desired value on time (Daft, 2003). The high power distance also led to delayed decisions and lack of coordination between the various organizational entities. These problems ultimately led to extreme job dissatisfaction for the employees like the accounts executives. The limited domain of authority of individual employees resulting from high power distance also made functional problems for the company. The plethora of problems experienced by the organization ultimately led to disgruntled customer base which subsequently led to fewer sales. Under the vertical structure employed by the company, the domain of control of the employee is also limited as each employee has a narrowly defined work criteria and he cannot violate the criteria at any cost. Although the employees can stick to these astringent rules for some time but ultimately they will get fed up due to the mismanagement in the organizational structure and their limited job roles. Hence, they would trespass their individual domain of control like the marketing specialists did. Under such a situation, the other employee would feel that their work spaces and domain of authority is being infringed and they would start agitating against this. The employees’ taking control of the authority of their supervisors would create problems for the senior management as well as they become perplexed with the audacious attitudes of their subordinates in times of tough decision making since they are no longer the controllers of their centralized authority (Shi et al, 2009). If we analyse the functioning of the organization from an integrative perspective, we can also conclude that the organization is less responsive to rapidly changing environmental conditions. Also, the different departments of the organization are having a myopic view about their goals and are not focussing on the company targets. All these myriad of problems of the organization need to be catered so that the company executives may be able to promote a healthy organizational culture coupled with a strong feeling of organizational citizenship. This healthy culture will lead to high customer satisfaction and low employee turnover as well as boosted sales. In all, the current organizational structure is not the best fit for the company at this time as huge problems are popping up due to the inadequacies in this structure. The executives of the company should strive towards restructuring the organization so that they may be able to revitalize the value laden business process and create customer and employee satisfaction (American Management Association, 1992). Reasons for the inadequacy of the Vertical Structure The myriad of problems created due to the vertical structure leads us to believe that the structure is inadequate but these problems are only the symptoms and it is very important to figure out the root cause of these symptoms. The vertical system is not the adequate system for any kind of small or medium sized company. The reason is that the there are only few employees in the company. Hence the employees need a proper coordination among themselves as the tasks are interdependent to a lot of extent. Unless the other person knows what an employee is doing, an aligned and effective effort is not possible and this is exactly what is happening in the case of Aquarius advertising company. The marketing and advertising specialists are directly linking their conversations with the clients while the accounts executives, who are supposed act as liaisons, are unaware of the entire transactions. Subsequently, they do not update their records and hence, efforts of the organizational entities are not aligned (Amis et al, 2002). Another reason for the failure of vertical organizational structure is that, the market in which Aquarius agency is operating is highly volatile and the conditions are changing day in and day out. Hence, there is no room for a centralized line of authority. The employees have to take quick and timely decisions and also have to stick to them. With a tall structure and high power distance, a lot of time is wasted in trivial decision which is disastrous in such a volatile market. By the time the senior management reaches a decision, the market conditions have already changed and the decision goes in vain (Wooldridge et al, 2008). In the vertical structure, the company departments are working under specialized domains and there is a huge collaboration gap. Due to this, the efforts of different departments are not integrated. As a result, despite of specialization in their respective departments, the company is unable to exploit this specialization and its benefits. There is also a negative phenomenon of employees not sharing their expert knowledge with each other. This has proved disastrous for the company as it competes in such a highly competitive market. The Solutions In such a critical situation the company has to reengineer its organizational structure and work its way towards a more integrative structure. Considering the kind of problems faced by the company, the most appropriate organizational structure would be the Flat structure. The Flat structure would be the best fit in such a situation because it can cater to the lack of coordination, integrated efforts, quick decision making and increased employee motivation. Increased coordination between the employees The flat organisational will help in bridging the gap in coordination between the employees. Now the customers would not only get in touch with the accounts executive but also the marketing and advertising experts at the same time. Hence, there will be provision for a comprehensive coordination between all the organizational entities. All the employees will be updating their records on a real time bases and no employee would be left out. This would also create motivation for the employees to work for each other and create a learning environment in the organisation. All this will lead to a high level of customer satisfaction and higher sales for the company. Integrated Value Chain With a high level of coordination, the company departments would also create shared value for the company. There will be less structural mishaps and a high level of value creation will happen throughout the primary as well as secondary functions of the organization. All departments will work in an integrated manner and build upon the works of each other. Quick Decision Making Under the flat organizational structure, the domain of control and authority of each employee will broaden up and this will also lead to employee empowerment. Under such condition, the decisions will be made quickly as the power of authority will get decentralized. The empowered employees will not dilate the progress of customer response and create more customer satisfaction. The emphasis on employee empowerment will reduce the burden of responsibility on the senior management and their role would be reduced to that of a supervisor. Since junior management has a more comprehensive knowledge base about the volatile market, they would also be better placed to make the right decisions. Increased employee motivation With the flat organizational system in place, the employees will work on team relationships and their hostilities will be mitigated. The employees will also start working on team based goals and the disgruntled attitude of a few will be reduced. In a nutshell, a culture of organizational citizenship will be inculcated in the company and every employee will look for value addition rather than individual value creation. The Learning Organization With the flat organizational structure in place, heavy prospects exist of a learning organization. The company should work towards being a learning organization. This will lead to a specialization in the field of collaborative organizational processes. For the company to become a learning organization, it has to work on five key areas (Yanow, 2000). Systems Thinking The company should create a peculiar culture in which the employees start thinking about the organization as a social entity and one that relies on the existence of its employees. The employees should start thinking how their efforts would impact others in the company and keep a holistic view of the company rather than qualifying themselves to their particular departments (Yanow, 1993). Personal Mastery The employees of the company should start to think about their affairs with the perspective of learning something. For this the company will have to start investing in training programs and provide learning forums to the employees. These learning opportunities will improve the quality of the workforce and create more value. A structure should be developed in the firm where people should work on personal mastery in their daily lives. There should also be matrices employed for the employees to provide them with the feedback. If they are not meeting their targets, they will know about it and the organizational performance as a whole will be improved. Mental Models The organization should work towards an open culture where the employees start to replace confrontational attitudes with those of consideration and care for each other. The people should share their mental models about work processes with others in the organization and try to unlearn the values that are not needed in the organization. They can also use ‘communities of practice’ to share their experiences with others. This will bridge the gaps between the employees and foster healthy relationships between the people (Thompson, 2005). Shared Vision The inculcation of the culture of communicating shared visions is integral for an organization like Aquarius Agency. The company should communicate the vision and mission of the firm throughout the organization with consistency and repetition. Side by side the company executives should also make the employees realize that the goals of the employees are consistent with those of the company .This way, the employees would be able to align their efforts with the vision and mission of the company. Along with this, as already discussed, the company will have to implement a decentralized structure so that the employees can get empowered. Team Learning The provision of team learning in the organization makes a healthy culture in the organization. The company should try to implement this strategy so that the staff can adapt to different situations quickly and its problem solving techniques get enriched with knowledge and expertise. In order to be successful at team learning, the employees will have to interact with each other which will help in bridging the communication gap. This will also lead to shared understanding between the employees (Cook & Yanow, 2011). Bibliography AMERICAN MANAGEMENT ASSOCIATION. (1992).Organizational dynamics. Ann Arbor, Mich, UMI. AMIS, J., SLACK, T., & HININGS, C. R. (2002). Values and Organizational Change. Journal of Applied Behavioral Science. 38, 436-465 COOK N., & YANOW D. (2011). Culture and organizational learning. Journal of Management Inquiry.20, 362-379. DAFT, R. L. (1991). Management. Chicago, Dryden Press. WOOLDRIDGE B., SCHMID T., & FLOYD S.W. (2008). The middle management perspective on strategy process: Contributions, synthesis, and future research. Journal of Management. 34, 1190-1221 SHI W., MARKOCZY L., & DESS G.G. (2009). The role of middle management in the strategy process: Group affiliation, structural holes, and iertius iungens. 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