As stated in the case, Café Britt moved to a hybrid organizational structure, a multi-country divisional/matrix structure that helped the company to maximize communication and cooperation between various countries’ operations and head office teams. Assess and explain the matrix structure and discuss its advantages and disadvantages. Make sure to provide a drawing of the matrix one.
Assessing and explaining Matrix Structure
Café Britt is a successful company in the coffee industry. However, adopting or shaping the organizational structure has become a major concern to operate in different countries. The firm is capable of shaping the hybrid structure to get some benefits. However, it seems imperative to identify some disadvantages as well to make the business and work process safe and sustainable. In the competitive industry, café Britt is trying to adopt the structure that supports the business expansion and workplace diversity (George & Jones, 2011). The firm has to eliminate these disadvantages to get real structural benefits. The Hybrid structure is a mixture of the divisional and functional structure (Aquinas, 2009). The Café Britt has to meet both functional and divisional needs. Therefore, shaping the hybrid structure is the right decision. Obviously, the firm can enjoy several corporate benefits or advantages
Advantages for Café Britt
Café Britt has shaped the hybrid organization structure to gain different corporate benefits. The matrix structure enhances communication among all key stakeholders in both internal and external business environments (George & Jones, 2011). The company has operations around the globe. Hybrid structure helps to establish an integrated system. Communication between various countries, operations, and office teams are possible through the matrix structure. Several advantages and disadvantages are in the limelight. The hybrid organizational structure is a combination of functional and divisional structure. The prominent advantage of the hybrid structure is a shared vision. Café Britt has created different teams in different sections. These teams work to achieve the same goals and objectives. The mission is shared, and therefore, teams can be divided and work separately (Hoffmann, 2012).
When operating in different countries, the company usually contains a diverse culture. People come from different regions with different values. The hybrid structure helps employees to enhance collaboration, increase productivity, and achieve goals and objectives. The real corporate advantage is communication among teams. In café Britt, effective communication between teams increases the knowledge sharing process and cognitive skills. In hybrid structure, people usually make rational decisions as compared to the functional and divisional structure. Coffee and chocolate products have been developed by the company. The firm deals with differentiated products. The innovative culture and creative approach of employees have justified the differentiation (Sasso, 2013).
The hybrid structure of café Britt creates the work environment that allows the work freedom. People at the bottom-line of the company are delegated effectively regarding the decision making and resource utilization. In a dynamic work environment, Café Britt accepts and admires different work behaviors and utilizes them in meeting long-term corporate goals and objectives (George & Jones, 2011). Café Britt has increased its scalability by adopting this structure. It supports business expansion and large operations to meet the needs of customers in different regions. People in the company are working in several geographical regions. However, they are depicting remarkable integration to work under the shared vision. It can help to create different management divisions. For Instance, a division of the management may carry the waste management and a recycling plan, and it can be done in the matrix structure (Taylor, 2015).
Disadvantages for Cafe Britt
Conversely, Café Britt has faced an immense contradiction due to the hybrid structure. It is the biggest disadvantage of the hybrid structure. For Instance, having two bosses in the company is always controversial. Style of work, leadership traits, and decisions can be different in the company. It causes conflict. Things usually go viral in this café due to these differences. Work sustainability is also a major concern for this organization. Due to differences, the work process is disrupted several times. Lack of work sustainability due to frequent intervention is a big disadvantage. Also, the administrative cost of the company is high. The administrative overhead is more than the functional and divisional structure. Café Britt, operating in different divisions, has to invest in conflict resolution. In the competitive market, it hits financial stability. It is a fact that Hybrid structure is big for the company (George & Jones, 2011).
The response to the exceptional situation such as market share decline, product failure, and other related events is quite slow. The company takes time to navigate several alternatives and come up with the best solution to regain growth (George & Jones, 2011). Café Britt is facing this disadvantage in the corruptive market. It has been revealed that a large group of employees has to use a single reporting system. It makes the reporting system vulnerable and ineffective. In the matrix structure, café Britt does not focus on individual performance and contribution. People are working in different teams frequently, and it seems tough to derive performance insights. Personal or individual contributions are lower in this organization. The hybrid structure is only suitable in large technology companies. These firms usually have to develop a product rapidly to meet the needs of a specific customer group (Iic.Org, 2010).
The structure of the organization is critical to its sustainability and serve (as stated before) as a source of the company’s competitive advantage. Do you believe that moving to a global multi-divisional structure might constitute an effective alternative organization structure? Assess the multidivisional structure taking into consideration the contextual variables of the case (i.e. products, growth, and geography). Develop and discuss the advantages and disadvantages of the multidivisional structure.
The effective and pertinent structure of the organization has always enabled business sustainability and competitive advantage. It has been observed that the effective structure helps the company to create a culture that supports strategies, vision, and mission. Firms with the goal of the competitive advantage are aiming to develop the relevant structure (George & Jones, 2011).
The global multi-divisional structure as an effective alternative organizational structure
In this contemporary business, the multidivisional structure has become an alternative organizational structure for different firms. For Instance, many firms contain different business divisions. Due to self-contained divisions, a multidivisional culture is to be created. Based on products, growth, and region, the firm management can manage or control each department in no time. In the competitive industry, many organizations intend to increase the product line. Companies accelerate the product development process to come up with a diverse product line (George & Jones, 2011). The multidivisional structure of the company supports different product developments in different industries (George & Jones, 2011).
Multidivisional structure in café Britt
Product
The café Britt must utilize the opportunity of the multidivisional structure. This company develops many coffee products in Brazil, Java, and other coffee producing countries. The scalability has been increased, and it needs an alternative to functional, divisional or matrix structure. Of course, the multidivisional structure is effective due to several advantages.
Regions
West Valley, Central Valley, Tarrazu, Tres Rios, Orosi, Brunca, and Turrialba are potential regions for the company to expand the product line. The quality of crops in this region is exceptional. Thus, a multidivisional structure is needed to take proper business control (George & Jones, 2011).
Growth
Depending on the organizational growth, market share and sales, the multidivisional structure is needed. For Instance, the company can calculate or estimate revenue streams, sales and profitability separately for each region. Thus, the multidivisional structure can support the separate growth for each division (Aquinas, 2009).
Advantages of the multidivisional structure
The big advantage of the multidivisional structure is the effectiveness. This structure increases effectiveness in the workplace. Employees of café Britt can increase their effectiveness due to several divisions. This structure supports or encourages separate roles and responsibilities of employees. Pertinent tasks in divisions increase employee effectiveness (George & Jones, 2011). Corporate managers and division managers are playing their roles effectively. The manager trains and develops people at different levels of the company. For Instance, divisional manager trains employees, according to new cultural values in the new division. Obviously, it is a right move to develop relevant employees and reduce the turnover.
Another advantage is the control of day-to-day operations. This structure creates flexibility in the operational process, and it looks easy for the manager to control separate work. Each manager holds his division to take control. It makes the process of large organization effective and systemic.
After delegating divisions to divisional managers, a corporate manager creates the space for strategic planning. The long-term planning process is important for a company like Café Britt. The business expansion, product development, increase in market share and strategic alliances with the firms can be a part of the strategic planning. Interestingly, the corporate manager may think of another business division to produce different products. Accordingly, another division can be created. Divisional managers have to work under corporate managers. These divisional managers are well trained to manage the business expansion at both large and small scales. Internal market labor is also a prominent advantage. For Instance, the firm selects a divisional manager to perform as a corporate manager (George & Jones, 2011).
Disadvantages of the Multidivisional Structure
The major disadvantage of the multidivisional structure is the controversial relationship between divisional managers and corporate managers. The contradiction may occur in the decision-making process. The corporate manager may like to use the centralization approach. On the other hand, the divisional manager may like to integrate with decentralization (George & Jones, 2011). Usually, it impairs the decisions making process and usually causes delayed decisions. The prominent disadvantage of the multidivisional structure is the competition between corporate and divisional managers. Both managers may try to have access to company resources. Instead of cooperating to meet business goals and objectives, these managers may contain personal interests and preferences. It seems destructive and leads to poor business decisions and control (George & Jones, 2011).
Due to the separate set of support functions, the cost of the division can be high. The company cannot set the same cost for each division. Keeping the balance regarding the cost is tough due to price transfer or price difference as well. Café Britt may come up with a differentiated coffee product, which includes special ingredients to meet specific customer needs. Of course, the cost of this division may be high (Aquinas, 2009).
References
Aquinas. (2009). Organization Structure & Design: Applications and Challenges. Excel Books.
George, J. M., & Jones, G. R. (2011). Understanding and Managing Organizational Behavior (6 ed.). Pearson.
Hoffmann, E. A. (2012). Co-operative Workplace Dispute Resolution: Organizational Structure, Ownership, and Ideology. Gower Publishing.
Iic.Org. (2010, April 20). Café Britt Costa Rica S.A. Retrieved from https://www.iic.org/en/projects/project-disclosure/cr3919a-01/caf%C3%A9-britt-costa-rica-sa
Sasso, L. (2013). Capital Structure and Corporate Governance: The Role of Hybrid Financial Instruments. Kluwer Law International.
Taylor, G. (2015, February 6). Café Britt Increases Email Open Rates By 18% With AgilOne. https://www.retailtouchpoints.com/features/
retail-success-stories/cafe-britt-increases-email-open-rates-by-18-with-agilone
+447462439809