I. TARMAC COMPANY 1. 1 Tarmac’s structure Tarmac was originally formed by Edgar Purnell Hooley in 1993 and now being the UK ‘s largest quarrying company and supplier of construction. Tarmac leads on the market of aggregates, ready mixed concrete and asphalt. Its business also include national contracting and Buxton. In process of forming and developing. Tarmac is required to has a clear structure to set up a wealthy business. Base on scenario, Tarmac has set in place an organizational structure that provides clear lines of control, responsibility and communication.
Tarmac is organized into three businesses: Tarmac Quarry Materials, Tarmac building Products and Tarmac international. To provide clear of control and responsibilities , in each area, the company focus on building three main level of staff means that the company. Each level engage with a specific range of responsibilities. Furthermore, Tarmac has a set of business principles to ensure employees commitment and help them understand their role. Tarmac operation contain support of some divisions and these divisions also share ideas across the company about how to improve processes and achieve cost saving.
It clear that Tarmac structure base on its three SBUs. As a large and complex company, Structured by SBUs support Tarmac in expanding their business rapidly in different geographic location. However, cost for building up a SBU is high and that is a challenge for development of Tarmac. Refer to appendix 1, beside some divisions support to Tarmac operation such as finance, human resource, etc…there are other divisions contained in each SBU. Tarmac aim to set up multidivisional structure also with purpose to define responsibilities for employees.
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Another point is that multidivisional structure will help Tarmac to apply total quality management effectively. However, communication problems may happen in this structure. a division can interfere work of others or repeat what other division did then cause misunderstanding, conflict and waste resource. In addition, to manage its big business, Tarmac need tall structure limit p of control. Wide p of control in a big company like Tarmac can make managers overworked and lead to improper decision making. Tall structure make it easier for managers to control and monitor performance of subordinate.
Also, many level of hierarchy provide clear line of responsibilities and control to support multidivisional structure. In multidivisional structure, a clear line of responsibilities is needed for dividing task to manager. Moreover, hierarchical structure enable Tarmac to make centralization. As a big company with many divisions, centralization is necessary for Tarmac to reduce redundant position for saving cost. On the other hand, hierarchical structure theoretically prevent communication between employees and high level of manager.
Employees and low level of management can find difficulty to contact with top level. 1. 2 Tarmac’s culture Tarmac pays much attention in their culture. In a multidivisional structure, task or role culture normally applied. Tarmac have to choose a culture that suit with its long term aim. Tarmac’s long term aim is to develop high performance teams who work within a culture of quality and continuous improvement. The company also believes in bringing out the best in all their people. With the goal to apply a culture that appreciate team base and individual potential, task culture is more suitable than role culture.
Moreover, what the company want is giving opportunity to employees to contribute their ideas on how to achieve result and encouraging a culture of learning. It is clear that Tarmac can not apply role culture to achieve these target because these are disadvantage of this culture. With task culture, Tarmac is able to achieve the company’s goal through team orientation. Also, task culture is an important part of employees involvement that Tarmac apply in total quality management. However, to task culture is not easy to apply. To build up high performance team, there are three big issue need to be taken in consideration.
Firstly, Employees engagement take much time and need a very proper detailed plan to achieve. How to motivate people and help them to achieve their potential are difficulty in applying task culture. Secondly, Tarmac face to high cost to apply task culture. Cost for training, team building and coordinating system may prevent the company from setting up their business. Last but not least, leadership is very important in team work. Who are leaders of teams ? How do they make decision ? and how do these decisions are effective. Leadership style is an essential tool to manage and motivate team work in task culture. 1. Relationship between structure and culture of Tarmac and their effects on business performance Organizational culture can draw a big image of a company, the size, performance and all relevant elements while organizational structure show the order and basis of this image. The picture of Tarmac is a number of teams which contain enthusiast and skillful people. Each of them engage with a suitable task and try to stand in higher place to achieve their own goal. Furthermore, all teams focus on a point which is Tarmac’s vision. If we consider about the structure, we can see that there are a chain from teams, operators, supervisors and managers.
One chain is representative for a particular division and group of divisions create a SBU. There is a relationship between structure, culture to business performance. In Tarmac. decision is made from high level of management because of centralization. However, task culture ensure that there is there are idea given by employees to managers to strengthen decision making. Decisions are originally made from top level by centralization and normally slow response to environment because they need time to pass through different level of hierarchy.
However, task culture has reduced this slow response. When having change to present ideas, employees engagement and commitment are improved. Also, this will help the decision applied quickly because employees can understand catch up with the change because they can be provide their own opinions which are take into consideration. Culture of learning and development tend to enhance and enrich the company knowledge. This culture promote productivity and reducing burden of managers in coaching and decision making. Many disadvantages in Tarmac structure are solved by their culture.
Employees in task culture can achieve their personal goals in a team. Poor communication between from different management level also removed by encouraging employees to show their ideas but the final decision is still belongs to managers so the decision making is improved. The culture makes the structure more flexible while the structure help to form the culture. Though work together in a team, employees are responsible for report to their manager. Moreover, different level of management set out standard to control performance of employees to ensure employees performance.
Also, zone managers are people who encourage and reward staff who contribute improvement ideas and action to ensure the equity of team performance. 1. 4 Influence individual behavior at work in Tarmac Individual behavior at work are built from environment inside company at large. Tarmac culture and policies aim to set up a standard of behavior for each position. Engaging employees and act responsibly are mentioned five big goals that are Tarmac value. The company emphasis that employees work at one team and each team achieve its full potential. Employees are expected to aware of team spirit for them to perform in team.
For each team to achieve its full potential, it need to make sure that all members can achieve their full potential. In other word, ability of employees should be used fully to improve team performance. Tarmac also appreciate importance of acting responsibly. It want employees to bring their expertise, enthusiasm and commitment to the activities they will deliver. The company require positive attitude at work with high responsibility.. Additionally, Tarmac has set of business principles that demonstrate its commitment to operating ethically and responsibly.
Employees have to understand that their work must support the company aims and objectives. Working in teams is not means that Tarmac doesn’t care about individual’s ability. Tarmac apply a learning and development for employees to develop their skills and build up learning attitude. Through presenting ideas on how to achieve the result, employees will get more understanding in their job. The company managers also have the task to encourage people to achieve their own potential. Employees of Tarmac have opportunities to contribute their idea on how to achieve result so that employees are free to present their working style.
As Tarmac mention in their strategy is to have right people with right skill means that people should be engaged in a task that suitable with their potential and expectation. So that not only about ability to do the task but also awareness of people for their task is concerned. Manager need to consider that each personality suit for a different task. Managers and leadership style are also affect employees behavior at work. One mission of zone manager is to encourage team through coaching and leadership. To work in a team, each member need a big motivation to be a part of it.
This mission is to ensure the attitude at work for each member remind them about their responsibility. Moreover, zone manager will encourage and reward staff who contribute improvement ideas and action. This action strongly promote employees to perform well and show their full ability. For human resource managers, their first mission is to manage change and facilitate training and development. It is essential to ensure that change in business or even change in responsibility will not affect to performance of staffs. Other duty of human resource managers is communicating with employees.
In teamwork, sometime it conflict may appear among members. Conflicts must be solve quickly to enhance coordination and avoid chaos. The manager have to apply HR policies and procedures consistently to develop partnership across different team. 1. 5 Organizational theory and business approach of Tarmac Hierarchical structure get it easy to apply classical approach so that Tarmac used to applied classical administration, specially bureaucracy. With a tall hierarchical structure, Tarmac takes it easy to build up hierarchy of command. This hierarchy obviously enhance delegation between management level so that it supports task delivery.
Tarmac also has a set of business principles to ensure employees commitment. In classical administration approach, employees are expected to work under a system of rules and principle and perform responsibly to these rules. Each staff engaged with a specific role (role culture) as a specialization. Classical approach can help Tarmac to build a strict management and ensure performance of the company at large. However, in the time that global economy is changing so fast, this approach is no longer suitable for Tarmac to adapt with business environment.
If there are problems in business performance, it may come from high level of management and hierarchical structure will prevent Tarmac from making a change. It require Tarmac to take another approach for the company long term aims. Considering Tarmac DREAM, the company clearly show their long term aim which is to improve overall performance of the company. Tarmac provide close connection with their customer and enhance employees involvement. In this case, Tarmac applied total quality management to achieve the exceptional. Total quality management is showed strongly in its Dream.
The first priority of Tarmac is developing market by working closely with key customers. The company recognized that customer relation is the key to success of each enterprise. Also, to deliver good products and services to customer, Tarmac has to care about its total performance, especially employees involvement. Tarmac ‘s long term aim is to develop high performance teams who work within a culture of quality and continuous improvement. Employees of Tarmac can contribute their ideas to improve quality product. This also strengthen employees commitment to the organization.
In others long term aim, Tarmac appreciate importance of reducing costs, acting responsibly and managing assets in enhancing total performance. For example, one of Tarmac strategy to acting responsibly is reducing waste to landfill. Tarmac wants all employees to bring their expertise, enthusiasm and commitment to the activities that will deliver most value in support of the company’s objectives. This strategy show that Tarmac really make a strong application of TQM to strengthen value of the company. In reality, total quality performance support Tarmac to improve and innovate the company ‘s product and services to satisfy their customer.
Inside the company, employees have got motivation and are encouraged to achieve their potential so that productivity will be improved. Moreover, with creative thinking of employees at work, Tarmac enable to get used to with changing of business environment. 1. 6 Leadership style of Tarmac To each company, leadership style is an important factor which affects its business performance. In Tarmac hierarchical structure, autocratic style was suitable for managers to make decision quickly and easy to apply, especially when Tarmac business need to response quickly to the environment. The company used to apply autocratic style for their manager.
Autocratic managers make all of decisions and employees need to follow them. Managers tell employees what to do and how to do it. Tarmac recognized that this style is necessary if the job is urgent and need to be done in particular way. However, the company also see that autocratic style will prevent efficiency of decision making in long term. Some decisions need thorough assessment and discussion and manager need more information from lower level to make decision. There are more burden to manager because their responsibilities are both decision making and controlling subordinate.
Useful feedback from employees for improvement is not taken into consideration then manager may make improper response to environment. Moreover, this style make a conflict with Tarmac long term aim of promoting and encouraging a culture of learning and development. Therefore Tarmac has put in place a programme of change management to improve performance and motivate staffs. Participative and coaching style applied as an alternative for autocratic style. Tarmac appoint coaching managers to develop employees and their responsibilities is to care about employees.
These managers tend to enhance task culture by encourage their staff to find a way to achieve result and learn from experience. A result is decision making is improved by two way communication and increase productivity because employees receive motivation. Tarmac aim to make a long engagement with employees and believe that employees will be basis for them to make difference and enable the business to be the leader in its chosen market so that coaching manage is Different from autocratic manager , Coaching manager appreciate employees potential more than evaluate task fulfillment.
They are people who can find out employees ability and help them to achieve their potential. Coaching style also support total quality approach in employees involvement by motivating training them. By applying two parallel leadership style, Tarmac create flexible management. Tarmac is able to response quickly to the business but also can strengthen decision making. This innovative application of leadership give Tarmac a big advantage in doing their business. II. VICEM HAI VAN COMPANY 2. 1 Hai Van’s structure In Vicem Hai Van, top management level include Board of Chairman, Board of director and Board of Controller.
In middle level, there are some deputy director below and report directly to the director such as deputy director of business, deputy director of manufacturing technic. Each deputy director is responsible for one area. There are also many departments under director or deputy director. The structure of Hai Van can be seen as a flat structure. There are few level of management from top level to employees and this enhance delegation. The advantage of flat structure in Hai Van is that cost for organizing management level is low. There are many deputy director and manager report to the director so that the director can be overworked.
There are many department in which people with suitable skills are grouped together and managed by managers. This functional structure support Hai Van in specialization and training. The functional structure of Hai Van follows decentralized decision making model. Deputy manager have authority to make decision in their department. This can a chance for these deputy managers to practice leadership and decision making and motivate them. Decision making process is fast and then response quickly to environment. However, coordination among department is a problem of functional structure and require solution from the director.
In functional structure, task are done efficiently because there are strong specialization to fix people to their most suitable job. 2. 2 Hai Van’s culture Vicem Hai Van has built up role culture since it was set up and the culture reflects on the structure. There are some departments and each department include many different level and position. Employees are fitted to their position as a specialization. Hai Van has applied role culture and this culture is also suitable with their functional structure. Role culture strengthen specialization and task engagement to employees in each functional department.
On the other hand, Hai Van has a policy to have right people with right skill and talent for making a full ultilization of human resource. The company also try to employ high skill employees to build high qualified labour force. Vicem Hai Van attempt to build up a evaluation system to check and assess exactly performance of each position. This policy is to ensure commitment of employees and equal treating to each position. This system show how strong of role culture in the company. Each year, Hai Van provide training course with purpose to maintain long term labor and improve productivity.
Hai Van mentioned in their objectives that they aim to maintain and develop production to higher quality, appearance and quantity. This objective point out that Hai Van tend to applied continuous improvement culture. Process and procedure are concerned and improved. Standard is set up for each department to improve productivity and efficience. Furthermore, the company give managers chance to study specialize knowledge to help them catch up with the environment. In conclusion, what Hai Van are doing is to build a strong management in which managers play important role on leading the company and guiding employees. 2. Relationship between structure and culture of Hai Van and their effects on business performance In Vicem Hai Van, decisions are made from top level. Role culture support the structure in engaging and distribute task to each position. Decisions have short making process through many level. Decentralization also speed up decision making and make quick response to environment. There are few management level so that manager can communicate well with their staffs. Commitment of employees is high thanks to suitable specialization and evaluation system. Performance of employees is also high because they are engaged in suitable task.
Hai Van encourage high skill employees to has long term commitment with the company. 2. 4 Influence individual behavior at work in Hai Van Vicem Hai Van aim to give clear responsibility, authority to each function in the company and attempt to ensure well coordination between different departments. This policy is to ensure that there are no conflict and misunderstanding between departments. Another policy is building and having training for a loyal, active leader team to make a permanent management. Employees who want to develop their career in Hai Van receive more benefit so that their will try to perform well.
Employees in Hai Van also engaged with task that suitable for their ability and skills so that there are tend to show their full ability at work. To enhance employees commitment, Hai Van build up a evaluation system to control and assess performance of each position. Employees act more responsibly to get their task done because the report from this system can affect to their benefit. 2. 5 Organizational theory and business approach of Hai Van In Vicem Haivan, the company tends to set up clear system of function, mission and responsibility of each unit.
Vicem Hai Van has a policy to train and develop a main manager team who are active and enthusiasted. Arrange and dividing task in a proper way to ensure that employees are match with what they do best and encourage creativity of them. Then Tarmac benefits from the savings and quality enhancement. In general, Vicem Hai Van also applied classical administration. The company has build up a strict structure. The policy of the two company has many similar point like conducting specialization, holding a clear chain of command, centralize decision making and appreciate responsibility and commitment of employees.
However, because of different size of business, there are some different characteristics. Classical administration in Tarmac is more complicated than Vicem one. Hierarchy in Tarmac is tall and clear with a number of management level while there are not many level in Hai Van because of the size of business. As in Vicem Hai Van, employees just simply need to fulfill their responsibility and their work are under control of evaluation system. On the other hand, in Tarmac, employees need to bring their expertise, enthusiasm and commitment to the activities they do.
Moreover, employees performance must support to Tarmac goal. About management, to go to the higher hierarchy, there are no special policy in Vicem Hai Van. The company just tend to train an loyal manager team with high skill and give little encouragement for attempt to develop of employees. However, in Tarmac, graduate trainee would learn though shadowing a selection leader during their training period so that he or she can aquire right skill and suitable tendency for the next higher position. 2. 6 Leadership style of Hai Van In Vicem Hai Van, all procedure is closed.
Employees do their task under instruction of managers and monitoring of supervisor. The most clear leadership style approach here is autocratic . Decisions are made among manager with few or no feedback from employees. The leadership style fit with the company role culture that employees need to fulfill their task base on the goals of the company. It is easy to consider autocratic applied has its benefit to make a clear chain of order through level of management and employees. Moreover, in autocratic style, manager can make decision quickly and it is useful if the decision is urgent.
However, this leadership style have difficulty in encouraging contribution from employees to improve decision making. III. ANALYSIS AND COMPARATION BETWEEN TARMAC AND HAI VAN 3,1 Comparison about structure, culture and business performance of Tarmac and Hai Van Tarmac is a big company which conduct business in some different geographic location. Tall structure is necessary for the company to control such a complicated business. To create advantage of competition and expand business quickly, structure by SBUs allow Tarmac to build new business quickly but stably thanks to available resource.
Furthermore, tall structure and centralization ensure that each SBU act responsibly to achieve the company’s goal. Tarmac have two choice of culture: task and role. Role culture may suitable with tall structure and also support specialization in multidivisional structure. However, Role culture can not support Tarmac’s long term aim to develop high performance team. Moreover, Role culture affect to the flexibility while the company want to develop a culture of quality and continuous improvement. Tarmac choose task culture as a most suitable culture for it in motivating people to achieve the company goal.
On the other hand, Hai Van is a local company which is a unit of Vietnam industry cement corporation. As a member of Vicem corporation, Hai Van tend to exploit local resource and just build up new brand in several nearby area. Therefore, Hai Van need a structure that help them setting up a stable and strong business, but not complicated one. Flat functional structure is a good choice for them. While flat structure is suitable with small business which need simple management to reduce cost, functional structure will support the company in training, recruitment and allocating available resource.
Tarmac has to spend a lot for management cost, but their structure is good for management training and regeneration of management levels. People in Tarmac can learn through shadowing a lead and acquired right skills and experience to go to the next position. Different from Tarmac, Structure of Hai Van is much cheaper to organized but contain some issues. If deputy manager have too much authority, they may make some decisions which are wrong or not suit with the company objective. Also, if they have little authority, the director may be overworked. 3. Comparison about business approach and leadership style of Tarmac and Hai Van A tall structure like Tarmac take it easy to apply classical music and Tarmac also applied this approach. However, to achieve the exceptional of its vision, Tarmac have to continuously improve their product service to meet their customer’s need. Tarmac must choose a new approach for it to adapt with change of business environment. With application of task culture and multidivisional structure, the company has opportunity to apply total quality management. Employees involvement is improved by multidivisional structure.
This structure also create a good environment of coordinating to achieve a specific goal. Tarmac also make a change in their leader ship style to improve total performance. Tarmac will take advantage of improvement of performance of productivity and responsibility to achieve their DREAM. In Hai Van company, it does not conduct business in a high competitive environment as Tarmac does. Therefore, Hai Van just apply continuous improvement culture. The company tend to improve performance by applying new technology, management training and evaluating system.
This strategy can take advantage in short term but may has some problem in long term. REFERENCE 1. Alangutterman (2008) center for management of emerging companies : Advantage of multidivisional structure [online] , 2008 [cited October 15th 2011] < http://alangutterman. typepad. com/emergingcompanies/2008/03/advantages-of-m. html> 2. Alangutterman (2008) center for management of emerging companies : Disadvantage of multidivisional structure [online] , 2008 [cited October 15th 2011] < http://alangutterman. typepad. com/emergingcompanies/2008/03/disadvantages-o. tml> 3. Thetimes100 (2010) Tarmac case study|Introduction [online], UK 2010 [cited October 15th 2011] < http://www. thetimes100. co. uk/case-study--how-roles-and-functions-contribute-to-competitive-advantage--109-326-1. php> 4. Thetimes100 (2010) Tarmac case study|Organizational roles and funtions [online], UK 2010 [cited October 15th 2011] http://www. thetimes100. co. uk/case-study--organisational-roles-and-functions--109-326-2. php> 5. Haivan (2011) General introduction [online], Vietnam 2011 [cited October 25th 2011]<http://www. aivancement. vn/index. php? option=com_content&view=article&id=1%3Aco-cau-to-chuc&catid=6%3Agi%3Fi-thi%3Fu&am p;amp;Itemid=18&lang=en> 6. Haivan (2011) Organization [online], Vietnam 2011 [cited October 25th 2011]<http://www. haivancement. vn/index. php? option=com_content&view=article&id=1%3Aco-cau-to-chuc&catid=6%3Agi%3Fi-thi%3Fu&Itemid=18&lang=en> 7. Haivan(2007) Cong ty xi mang Hai Van [online], Vietnam 2007[cited Novenber 1st 2011]< http://tailieu. vn/xem-tai-lieu/cong-ty-xi-mang-hai-van. 28563. html>
APPENDICES Appendix 1 – Tarmac structure TARMAC GROUP Procurement Marketing IT Finance Human resource Tarmac building products Tarmac international Tarmac limited Operation Operation Operation Operation Commercial Commercial Commercial Technical Technical Technical Safe, Health & environment Safe, Health & environment Safe, Health & environment Recycling Recycling Recycling Estates and Geology Estates and Geology Estates and Geology Engineering department Products operation and operations management Appendix – Hai Van structure
Table of Contents I. TARMAC COMPANY1 1. 1 Tarmac’s structure1 1. 2 Tarmac’s culture2 1. 3 Relationship between structure and culture of Tarmac and their effects on business performance3 1. 4 Influence individual behavior at work in Tarmac4 1. 5 Organizational theory and business approach of Tarmac5 1. 6 Leadership style of Tarmac6 II. VICEM HAI VAN COMPANY7 2. 1 Hai Van’s structure7 2. 2 Hai Van’s culture7 2. 3 Relationship between structure and culture of Hai Van and their effects on business performance8 2. 4 Influence individual behavior at work in Hai Van8
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