Group Comparative Analysis (Organizational Theory)

Star TV, TaylorMade Adidas Golf Company, PCCW Directories, PCCW – IMS Call Center Business, and National Car Rental: a Group Comparative Analysis on Organisation Theory

INTRODUCTION
While it is true that most organisations share common attributes as well as differ in terms of its specific and general dimensions, these similarities and differences serve as distinct features contributing to the corporate success and revenue development. Organisational structure and the controls as part of it are contributory elements of its performance (Rapert and Wren, 1998). Understanding organisational structure includes the size of organization, its life cycle stage, environmental factors, technology, power and culture and extends to the proper formulation and execution of strategy. The evaluation of effectiveness is also incorporated on the actual framework of the business as well as its operations. On this case, five (5) identified organisations were analysed based on organization theory by specifically looking on effectiveness and environment extending to size, structure, strategy, growth, technology and culture. It also identifies similarities and differences and potential explanation on such findings.

EFFECTIVENESS
Hitt and colleagues (2003) believes that there is no inherently superior strategy or structure, and there is no inherently superior strategy/structure match. However, it is noted that organisations must match strategy and structure to increase profitability of competitive success. On the case of the five (5) chosen organisations, the effectiveness of their organisational structure is reflected on their progressive business trends. This means that the characteristics of their organisational framework are positively integrated to their performance and ability to compete in their niche market. When the organization performs well, it corresponds to the appropriateness of the organisational structure. The findings in the individual report noted the strengths of the given structure however, similar challenges are minimally recognized.

ENVIRONMENT

The general environment of all the studied organisations is facing a great challenge of global competition. Similarly, every organization faces a different reality in the marketplace depending on its products, customers, technologies, government influences, and so on. There are essential forces that affect organizations within the context of their business operations and performance along with key changes that occur in the general business setting. The role of environment in identifying customers and their varying wants and needs are expected to complete a better competitive advantage by producing a number of different offerings to meet the needs of specific segments (Proctor, 2000). Further, the role of environment is inherent to the nature of market segmentation – the process of clustering people with similar needs into individuals and identifiable groups (Neal and Wurst, 2001; Jain, 2000), as it serves as the primary determinant. The environment constitutes a significant variety of people who probably are the future consumers of the product of service. It serves as the main source of information and knowledge for marketing decision making and strategy formulation and execution. In general, the challenge of global competition is addressed by the continuous recognition on the requirement to improve business operations specifically on gaining competitive advantage. Among the five (5) organisations, STAR TV, PCCW Directories and IMS Call Center Business have complex degree of environmental uncertainty. This is due to the different factors, such as globalization of business trends and the rapid expansion of its operations not only on current geographical areas but also on emerging marlets. Conversely, TaylorMade Adidas Golf Company and National Car Rental have stable and simple environment because of their individual inclination to the top management members and their policies.

With the similarities and differences on environmental factors (i.e. internal and external), there is still a need for change on weak aspects of the organisational environment. Considering competition excluding financial and human resources, each of the mentioned organisation are subjected to maintaining or improving internal and external environmental conditions. General environment factors specifically social, technological, political, economic and environmental should be monitored because such factors may influence the organisation but not always relevant to the organisation. The environment, wherein task (specific) qualities are directly relevant, should address the needs of stakeholders including customers, suppliers, competitors, regulators, and shareholder. Additionally, the niche market, where the organization chooses to deliver its products and services should interact to various levels of environment. In relation to organisational structure, design approaches may focus on organisational change in the service of performance and productivity.

SIMILARITIES AND DIFFERENCES

On strategy, STAR TV, TaylorMade-adidas Golf Company, PCCW Directories and IMS Call Center Business use the same competitive advantages using product and service differentiation strategy because of the need to come up with the most innovative products and services that cater to the needs of the target market. National Car Rental, on the other hand is more on cost leadership that is pursuing competitive advantage through lower costs. This is also attributed to its goal, that is, to be the primary choice in car rentals.

On the aspect of size, STAR TV is large with approximately 700 workers in Hong Kong Headquarter alone and further 2000 workers in other Asian regions; TaylorMade Adidas Golf Company is large and has almost 30,000 employees; PCCW Limited including its subsidiaries – Directories and IMS Call Center Business approximately employs 14,400 employees that shares a significant portion of the entire population. These aforementioned organisations are predominantly large because they are parts of a major organisation and operate beyond geographical borders. On the contrary, National Car Rental is small in size with 12 staffs comprising the organisation. This is attributed to the simple and certain environment factors and line of business.

On life stage cycle, STAR TV and PCCW IMS Call Center Business are on elaboration of structure stage where several strategic investments have been made throughout the Asian region. Meanwhile, TaylorMade Adidas Golf Company and PCCW Directories can be considered as companies in the entrepreneurial stage as they both focus mainly on products and services production that can be sold to customers and niche market. For National Car Rental, it focuses on mature management as rooted on its simple and certain strategic intent and direction of being the key choice in car rental.

On the case of overall structure, STAR TV is divisionalised or diversified in form and exemplifies the major role of structure in coordinating the work of the entire organisation. STAR is vertically decentralised, where the dispersal of formal power down the chain of authority is exercised and vested in top management but it may be delegated to lower levels of the vertical hierarchy. High complexity is seen in terms of its structure, particularly on localization of programs and operations. On specialisation, all jobs are specific and well-defined. Employees in its main headquarters and regional operations have extreme division of labour and specialised departments/units. STAR uses decentralization in structural dimension. Complexity is known to be spatial because it mainly emphasises on geographical location. Professionalism, personnel ratios and span of control are still relevant and much valued. In communication, information processing and structure, STAR maintains a vertically directed structure. On the case of Taylor-made Adidas Golf Company, the structure is rooted in the entire Adidas Group. Formalisation is high because it relies on rules and procedures to direct behaviour, position and work flow. Specialisation is high wherein specialised units and departments work on separate activities yet maintaining a common aim based on corporate mission and strategy. Centralisation is also high because authority and power rests on the top members of the management. On the aspect of complexity, the Company is low. However, complexity does evolve because of high processes in production and corporate standards and provided that it is vertically integrated. Professionalism, personnel ratio, and span of control are also high. On PCCW Directories and IMS Call Center Business as among of the divisions of PCCW Limited, it is assumed that the organizations’ structure is divisional. PCCW Limited as well as its subsidiaries possesses high level of centralization as rooted on its origin as family-controlled Asian firm. Low complexity is seen in the entire managerial framework of PCCW (i.e. Directories and IMS Call Center Business) as it uses Porter’s differentiation as competitive strategy. It is also attributed to the fact that PCCW originated to a family business, thus, there is a systematic or single source of control and authority. PCCW Limited including Directories and IMS Call Center Business generally has high degree of specialization or professionalism because of the need to cope up with intense competition, globalization and demands for Asian firms to adopt western style of management. There is also low degree of formalization. PCCW do have defined rules that are to be strictly implemented on the functions of decision-making and taking, communication initiatives, and control mechanisms. On National Car Rental, organisational structure is very simple, entrepreneur in nature, and possesses low chart. All in all, the similarities as well as the differences in terms of structure is said to be based on managerial strategy and implementation. Organisations are built in similar structures yet it is up to their leaders and management people to justify the chosen framework. Besides, organisational structures have their individual competitive edges or strengths and common share of weaknesses.

On technology, majority of the organisation acknowledge its crucial role in the whole operations and competitiveness. STAR TV, looking on Woodward’s ideas, falls on the Group II, which is the large batch and mass production. Also, there is technology to drive growth of customized products and TaylorMade Adidas Golf Company where it utilizes manufacturing technology or engineering type / craft technology but not in all of its business side. It can be pooled, sequential at the same time reciprocal as the environment they adopt involves a lot of integration from one point to the other. Technology in PCCW Limited particularly on Directories generally functions as determinant of pace and timing of tasks, providing information to managers on performance, and dictates standards. According to Woodward’s theory, technology and structure of PCCW Directories and IMS Call Center Business is categorized on Group III, which is the continuous process production. However, IMS Call Center Business exemplifies routine technology with few exceptions, easy analysis of problems and standardised working procedure. The National Car Rental as analysed on Perrow’s Matrix indicates a job fairly predictable with few exception (i.e. renting car) on task variability. Routine is hard to solve in terms of problem analyzability.

Since technology is commonly connected with innovations, majority on the organisations invest on technological infrastructures so as to developed innovative products and services for the target market. Product differentiation relies on the ability of each organisation to deal with the needs and current demands of both the global market and its consumers.

Lastly, on the case of culture and power (control) STAR TV practices rational-legal authority where authority legitimated by virtue of supremacy of law and formal rules is used in conducting the organisation. On French and Raven power types, STAR uses legitimate power where formal standards, rules and laws are exercised. STAR reflected News Corp.’s culture of taking risks and swift decision-making with minimal formal structure. STAR projects the organisational culture of News Corp. by serving as powerful source of control and achieves Behavioural Consistency through a system of Shared Values and Meaning both in internal and external perspectives including the needs of the environment and strategic focus. Adaptability culture has penetrated deeply into key markets with mass appeal general entertainment channels, produced locally in local languages, by local talent. STAR also uses mission culture type as noted on its organisation’s purpose and on the attainment of goals, managers share organisation’s goals and future direction, rewards on high performance, and environmental relativity. For TaylorMade Adidas Golf Company, reward is legitimate as well as coercive in handling power or at times referent and expert. The type of control is market centred and also deemed towards technology concentration. TaylorMade Adidas Golf Company has ample organization culture from such internal adaptation of business (e.g. corporate culture function areas) and external adaptation in business situation and environment that can be reflected in operations and people management. On the case of PCCW Directories and IMS Call Center Business, it is a bureaucratic organization, which according to Weber, it involves the following main characteristics: Rules and procedures, Specialisation and division of labour, Hierarchy of authority, Technically qualified personnel, Separate position and incumbent, and Written communications and records. PCCW Limited and its subsidiaries project an outstanding traditional Chinese culture. Again, PCCW originated in a family owned business, so its organizational culture is not far from Chinese leadership and managerial attributes. Mission culture is exemplified by PCCW. It is characterised by focus on the organisation’s purpose and on the attainment of goals; high performance is usually rewarded for success; managers share organisation’s goals and future direction; and environment is relatively stable.

CONCLUSION

Star TV, TaylorMade Adidas Golf Company, PCCW Directories, PCCW – IMS Call Center Business, and National Car Rental as examples of contemporary organisations employ specific organisational structure. In recognising the diversity of their target audience as well as the products and services offered, these similarities and differences in their overall corporate framework serve as their inherent and distinctively competitive advantage against their main rivals. In all the cases studied, the fact remains that there is no single structure that works best for every organisation. Considering its current position of these organisations in the niche market, perhaps their structure is the best one. In the end, the best structure is the one that helps organisation to achieve its goals through an effective and progressively driven strategy.

REFERENCES

Primary Sources – Corporate Websites

http://www.nationalcar.com/

http://www.pccw.com/eng

http://www.startv.com/

http://www.taylormadegolf.com/home.asp

Secondary Sources

Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. 2003, Strategic Management: Competitiveness and Globalization, 5th ed., South-Western, Singapore.

Jain, S. C. 2000, Marketing Planning and Strategy, South-Western College Publishing, Cincinnati.

Neal, W. D. & Wurst, J. 2001, ‘Advances in market segmentation’, Marketing Research, vol. 13, no. 1, pp. 14-18.

Proctor, T. 2000, Strategic Marketing: An Introduction, Routledge, London.

Rapert, M. I. & Wren, B. M. 1998, Reconsidering Organizational Structure: A Dual Perspective of Frameworks and Processes, Journal of Managerial Issues 10(3): 287+.

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