Introduction
Every institution or commercial enterprise has an elaborate organizational structure to guide its operations, management and overall growth. However, the structures differ from one organization to another despite existent universal standards and similarities in how organizations execute their processes to achieve desired goals (Actuation Consulting Staff, 2013). For instance, BMC Company has adopted a centralised approach of organizational structure in which planning, decision making, and management policies are currently decided at BMC headquarters. Therefore, the company’s decisions are placed solely on the discretion of the organization’s executive management team. Simply put, BMC operates on the top-bottom approach which is one of the most common management strategies in practice. Indeed the BMC organizational structure has resulted to many problems especially in the post-COVID-19 era that ranges from employee dissatisfaction, low-staff retention and competition from other rising organizations.
This report is important as it helps the managers to understand the progress of the current organizational strategy used by BMC. Another important structure that is compared with the BMC’s structure is the functional organizational structure. With the evaluation of the report and its recommendations, BMC is able to assess its current structure used vis-à-vis the functional one. In addition, the report explains how people practices can support strategic transformation that aid in achievement of business goals. In essence, this report and its recommendations help in establishing the links that exist between organizational structure, strategies and the extensive business environment. Equally, the report explains the role of BMC’s People Practice Team in achieving the organization’s objectives in comparison with the ‘boundaryless’ structure of organizational management.
Discussion
Advantages and Disadvantages of Centralised and Functional Organisation Structures
From the background case, BMC is a purely centralized organization in which the Chief Executive Officer (CEO) makes important decisions and provides strategic decisions for the company. The business structure that is adopted by the BMC’s CEO has its own advantages. Firstly BMC enjoys the benefit of clarity in decision-making with regards to issues that pertain to strategic planning (Masterclass Staff, 2022). Analytically, this is true because a decision regarding running of the BMC affairs comes from the CEO alone. Clarity of such decisions is based on the fact that the communication is unidirectional, from the CEO to other regional managers (Bordoloi, 2021). Secondly, there exists a streamlined implementation of policies and guidelines within the BMC structure. Here lies the strength of BMC because there is uniformity when it comes to policy execution, thereby making tracking of the company’s growth to be easy (Actuation Consulting Staff, 2013). The advantages of centralized system of BMC ensure its stabilization amid the post-COVID-19 era of economic downturn.
Majorly, BMC is faced with the disadvantages of limited opportunity for the staff to provide feedback and higher risks of inflexibility. As the CEO is tasked with the main responsibility of making strategic decisions in the BMC’s headquarter, the regional managers may not able to add their suggestions to the communicated decisions (NiDirect, n.d.). Again, being that decisions are communicated from the central office, there are high possibilities of BMC not able to adapt to the ensuing post-coronavirus economic hard times. Therefore, BMC has an opportunity of changing or modifying its organizational structure to suit its strategic goals.
A business structure that is dissimilar to the organizational structure of BMC is the functional organizational model. Compared to BMC’s centralized structure, functional organizational or decentralised organization structure has its advantages. Firstly, decentralised organizations are quick in making decisions as well as responding to any emergent issue (McKinsey Staff, 2021). Decisions are made in a timely manner in whenever problems occur within the organization because making of decisions is not reserved the top management. Secondly, the decentralised structure of management boosts morale in employees thereby resulting in high staff retention (CIPD Staff, 2016). Empowering staff to make decisions motivates them and helps to increase their morale. This is because they feel as being part of the organization (Grant, 2020). Indeed decentralised structure of management is capable of enabling an expansion of a firm to a large corporation.
Whereas decentralized system of organizational structure can be beneficial to many institutions, there are disadvantages to this type of structure. Decentralized organizational structure is characterized by problems, making it difficult for various departments to work towards a common goal (Lieberman, 2018). Because decision-making is devolved to various company sections, it is usually difficult to ensure that all the segments are working consistently to achieve the strategic objectives. Incongruity in operations is among the major challenges facing decentralized organizational structures (CIPD, 2016). Since the decision-making has been delegated to the lower levels of management, a particular manager may tend to alter or customize the decision to suit their needs. In this case, it is then hard to avoid shortcuts that may be employed by some decision makers in the regional offices.
Connections between Organisational Strategy, Revenue Generation, Products, Services, and Customers
The establishment of the link between strategy, products and services, customers, and company revenue should first begin by studying its importance. In fact, an institution’s performance is pegged on its strategy, clients, and revenue generation. Performance and profitability of organizations are directly influenced by the types of teams they incorporate: high or low-performance teams (Bordoloi, 2021). As such, successful organizations outdo their rivals in employee engagement and retention, organizational leadership, and customer satisfaction (Brignall, 2021). For that reason, an organization has to align its income generation with its strategy, product and services, and clientele.
Aligning products and services with an organizational strategy is an essential step in pushing market position and growth. It also equips the sales and marketing teams with the desired road map needed to achieve the company goals and ambitions (Kim, 2016.). Furthermore, the alignment helps an institution prioritize the production, distribution, and marketing of goods and services based on demand, market projections, and historical data. By analysis, this positioning can enable a company to embrace a wider variety of food products by offering excellent customer services to its clients hence expanding its market segment.
The customer is at the centre stage of profitability of an effective organization. It is because of this reason that an organization aligns its customers’ needs and wants with its organizational strategy (McKinsey Staff, 2021). The alignment entails understanding the target market segment, demographic and geographic analysis of the customers, and target products or services. Through understanding its customers’ needs, an institution is able to comprehend its customer’s behavior, especially when launching new products, releasing updates, or improving products and services (Vijayakumar, 2021). In addition, a company’s marketing and management teams have a clear understanding of when to produce its products in bulk quantities and which regions to launch new products and services. Cognizance of customer needs makes any organization better placed to respond to its customers’ complaints and requests in a modular manner, without affecting other product lines or services (SHRM Better Workplaces, Better World Staff, 2022). In the end, an organization is able to tailor its products to customers’ needs.
Besides customer needs, aligning revenue with an organizational strategy is complex but equally important in any business setup. It entails formulating a formula that guides an organization in a strategic, realistic, and feasible revenue generation venture (Ryba, 2021). On that account, a company’s strategy is not only focused on winning customers but also on generating revenue without extorting them. In consequence, an organization invests the right resources to ensure the revenue generation goals are in line with the overall strategic performance.
External Factors and Trends Impacting Organisations
Being that organizations have both the internal and external environments, they are affected by some factors that may emanate from the outside environment. Examples of the external factors and trends include market, competitive contexts of firms, principal demographic of the business locality, technological trends among others (Brignall, 2021). Foremost, market trends impact organizations more so with regards to building of clientele base (Sadderwhite, n.d.). There are products for which their market segment is saturated and when such goods are produced in bulk, the producer may run a loss. In addition, competition is a crucial factor that influences strategic planning of an organization (CIPD Staff, 2020). Therefore, within the context of strategic planning, an organization needs to leverage on its strengths to ensure that it creates a competitive advantage over other firms. A feature of creating competitive advantage is the diversification strategy that makes a firm to cater for various needs of a customer (CIPD Staff, 2020). Technological trends are a big boost to organizational growth because it helps in increasing the presence of organizations in places they were initially absent. As evident, the external factors may influence the profitability of organizations or even make them to collapse.
Current Organisational Priorities and the Associated Issues and Causes
Currently, BMC is grappling with two major strategic priorities that influence its operations as an effective organization. Firstly, the current organizational priority in BMC is the restructuring of its management structure. After the COVID-19 era, the management style of BMC changed to the centralized one in which decision making was entirely placed on the CEO in the headquarter. The restructuring was undertaken by the BMC to modify its management because the firm was facing financial pressures from the effects of coronavirus pandemic. Moreover management restructure was a way of limiting financial harm and improving the business (Deshler, 2022). From the nature of the effected changes, it is clear that the restructures were caused by financial pressures due to COVID-19 lockdowns. Another causal factor was the competition from the small cafes that were selling similar products as BMC. Undoubtedly, increased competition is a factor that has led to management transformation in BMC.
Besides management restructuring, the second organisational priority is the labor shortage. This is a challenge that is facing BMC because the company is losing most of its staff who are demotivated (UN Women, 2022). As a result, there is high staff turnover because it has become difficult to recruit staffs that are needed by BMC. Nevertheless, the causes of the labor shortage can be attributed to two factors. Firstly, the company has neglected the people side of the business and that is why some staffs are not happy with how the company is conducting its operations. Secondly, there is stiff competition for staffs with other small cafes that have grown in the area (Brignall, 2021). Inarguably, BMC needs radical measures aimed at reviving the dwindling situation of BMC.
A Critical Evaluation of the Relationship between the Employee Lifecycle and the Work (Or Potential Work) as a People Professional
There is a close relationship between the employee lifecycle in an organization and a people professional role such as human resource. For instance, an employee’s life cycle begins with recruitment which is greatly dependent on the criteria set by a human resource specialist (Grant, 2020). Therefore, the first correlation between employee lifecycle and the work of a people professional is based on the suitability of a candidate to specific job roles (Masterclass Staff, 2020). In the employee lifecycle of integration post onboarding, it is the duty of human resource officer to impart relevant key skills to the selected candidate. From a critical viewpoint, it can be deduced that the tenure of a certain employee within an organization depends mostly on the recruitment and onboarding stages. Indeed, the nature of the relationship between a new employee and human resource functions is fundamental to the worker’s stay in an organization (Brignall, 2021). The next cycle of an employee’s existent in a workplace is the performance management. People professionals relate to performance management through effective career planning and performance appraisals. As evident, the employee lifecycle and the work of a people professional are intertwined and complementary.
Explanation of Two Key Themes that are Currently Impacting People Practice and Shaping how Your Area of People Practice Supports the Organization
Two key themes that are impacting people practice and are getting a great deal of attention are reimagining the world of work and emphasizing the employee safety and well-being. As a thematic concern, reimagining the world of work is impacting people practice because it is the critical department that devises solutions on how to better align an organization’s goals along with the changing landscape of the workplace (Bordoloi, 2021). Reimagining the world of work is a discourse that has been triggered by the current COVID-19 pandemic where people practice is envisioned to shape the new world of work. An additional crucial theme is safety and wellbeing of workers in the work place (Deshler, 2021). This has resulted in improved work-life balance culminating to reduced burnouts and depression. It is evident that the current conversations around some issues pertaining to work environment will greatly affect people practice.
How People Practices Impact on Organisational Systems and Structures
People practices greatly influence institutional structures thereby affecting profitability of the organizations. In simple terms, people practices include all activities and strategies that are used by organizations across a worker’s lifecycle. Examples of the practices include, recruitment of employees, creating talent pools, analysing of people information, formulating people policies, handling of individuals’ resentments, and evaluation of people’s needs (Masterclass Staff, 2022).They impact organizational systems and structures by fostering cross-functional collaboration, forming business and strategic partnerships, emphasizing the importance of upskilling and reskilling to a diverse workforce, and performing horizon-scans.
Topmost, staff recruitment is a costly and sensitive aspect of people practices. The importance of hiring is based on the fact that it determines who formulates or implements organizational policies and programs (Williams-Grut, 2022). Hiring the right CEO can enable an organization to improve its productivity, expand its customer base, produce new products and satisfy customer needs. On the other hand, employing an incompetent CEO risks collapsing an organization and driving it into losses and debts. In essence, the productivity of an organization is grounded on efficient skills of an individual.
Handling of peoples’ grievances determines the growth of an organization. Institutions that allow people to freely air their grievances have fewer cases of strikes and demonstrations (Sadderwhite, n.d). This is because such cases of industrial actions are averted through vibrant labor unions, social media platforms, and feedback forms. Without a doubt, effective handling of workers’ grievances creates a positive work environment which strengthens the relationship between the employees and employers.
The policies formulated by a company on how to treat its employees together with the data analysis on the staff can build or break an organization. By and large, firms or institutions that formulate employee-friendly policies tend to experience positive growth in employee retention and overall productivity (Vijayakumar, 2021). Department-specific policies dictate the accomplishment of the projects carried out in such organizational structures as well. Data analysis, especially on employees and customers information remains a vital practice in the current era of big data (Sadderwhite, n.d.). Analysis of employee data is topmost when a firm wants to gauge the suitability of a staff to a specific role. Inarguably, wrong analysis of data or inconsistencies in employee data can contribute to erroneous decision making within organizations.
In building strong client base, an organization applies the assessment of individuals’ needs as an aspect of people practices. Examining user data helps organizations understand customer needs, demographics, and reactions to new products or improvements, enabling them to make the most effective decisions. Companies that make good use of data find themselves performing as much as 50% better than their rivals (McKinsey Staff, 2021). Comparatively, institutions that rely on traditional decision-making tools are less competitive and may fail in extremely competitive environments or markets. For that reason, institutions need to use data to gain a competitive advantage over their competitors at this information era.
How the BMC People Practice Team Connects With and Could Support the Two Strategic Priorities at Point 4 Above
Apart from employee lifecycle, people practice team can be involved in other areas within a business setup thereby supporting organizational priorities. BMC people practice team could connect with the strategic priority of management restructuring by engaging the employees on the type of organizational structure they preferred prior to the effected transformation (CIPD Staff, 2016). In illustration, the people practice team could support the strategic priorities by creating an environment that promotes dialogue and respect for other peoples’ opinions. Similarly, the people practice team could link with the BMC with its both internal and external customers through creating communication channels that allow for open discourse and real time feedback. This way, the workers’ grievances and complaints could have been channelled to the management which then addresses them through collaborative approach (Bordoloi, 2021). Inarguably, this helps in reducing employee dissatisfaction which would otherwise lead to resignation.
How the BMC People Practice Team Would Consult with Relevant Parties to Clearly Understand Needs for this
Various ways can be employed by human resource professionals to understand the needs of internal customers. One such way of consultation is the use of suggestion boxes. For a company such as BMC that seeks to understand the staff needs with regards to the type of organizational structure they prefer, suggestion would be useful in understanding the managers’ needs (NiDirect, n.d.). This would motivate the workers and allying their fears about centralisation strategy. Secondly, the people practice team can organize consultative meetings with the managers to help them express their thoughts in a more open manner without victimisation (SHRM Better Workplaces, Better World Staff, 2022). This would help in building a collaborative work environment where change can be effected to reduce high turnover of staff. Besides the aforementioned consultation methods, other strategies include interviews, questionnaires, and analysis of employee data.
Key Components of Planning Strategies for Ensuring that Projects are Delivered in Line with Customer Requirements
Delivery of projects in line with a customer’s requirements needs effective project planning. The first component in planning is the conception stage where the aims or the objectives of the projects are identified (Williams-Grut, 2022). This can be, for example, the resolution of an organization problem or the analysis and creation of a tangible opportunity. The next important aspect of planning is the development phase in which every tool or resource that is needed to implement a project is arranged or set in place (McKinsey Staff, 2021). The next stages of planning are realization and termination. Realization marks the phase in which the plan is executed within the set guidelines using the subcontracted or acquired resources (Grant, 2020). Following realization is the termination stage which signifies the success of a given particular project. However, effective planning requires not only following the components in plan execution but project leadership as well to ensure that needs are met.
Conclusion
In summary, each type of organization structure has its own weaknesses and strengths. However, each structure is applicable to a particular institution and not every business uses a specific strategy. Without a doubt, there is a linkage between organizational strategy, revenue generation, products, services, and clients. Despite the aforementioned relationship, other external factors affect business environment. It is therefore crucial to understand aspects of commercial enterprises in totality.
Recommendation
Based on BMC’s background information, the company needs to be more people-focused, decentralized in utilization of all the skills of the employees in addition to upskilling and reskilling them to run a more efficient operation. Therefore, it is recommended that BMC realigns and implements a “boundaryless” organizational structure. This type of organizational structure focuses more on the employees and provides a flexible business environment that enables colleagues to transcend geographical boundaries (Masterclass Staff, 2022). Decentralization of decision-making functions to regional offices coupled with open communication channels will ensure that BMC improves its financial position.
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