Valve Case Study

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1101IBA – Management Concepts

Literature Review and Report

Valve Case Study


Muhammad Rabani b. Shamsul Khairil

Semester 2, 2012

1 583 words

Table of Content

1. Introduction 3 2. Problem Identification 3 3. Analysis 4 3.1 Vertical Organisation Structure 4 3.2 Horizontal Organisation Structure 5 4. Recommendations 6 5. Conclusion 7 6. Reference List 8

1. Introduction

Organisation can be seen as networks of system perform by a collective effort of people in order to achieve to a common purpose. (Schermerhorn et al. 2011, p.11). An organization can be structured in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs (Damraks 2009 p.1). Valve has a unique flat organisation structure where it operates. The purpose of this report is to discuss how selective adaptation of a vertical organisation structure can increase the efficiency, performance and growth at Valve. Firstly, this report will identify and examine Valve’s organisation structure problems within two main scopes of organisational structure, the horizontal organisation structure and the vertical organisation structure. Secondly, this report will analyse the academic literature regarding the two main scopes of organisation structure mentioned above as to deal with Valve’s problems. Thirdly, recommendations for Valve’s will be given based on the analysis of the research. Main argument of this report is Valve must adopt some elements of vertical organisation structure while maintaining it organic structure to maximise performance and growth.

2. Problem Identification

Organisation structure is a fundamental element within an organisation. Organisation structure is a set of relationship that enables its members to perform task far beyond the reach of individual accomplishment. People are assigned to specific positions within an organisational structure to increase the specificity of tasks and the reliability with which they are performed (Alvarez & Robin 2001, p 2002). There are two distinct types of organisation structure – vertical organisation structure and horizontal organisation structure (Ikeda, S., Ito, T., & Sakamoto, M. 2010, p478).

Valve is a successful and one of the top video game software development company in the gaming industry. With around 300 employees and a success story, Valve uniqueness lies in the company organisation structure. Valve organisation structure is said to be a flat and organic organisation structure, not what one expect from a big corporation company. With the growth rate and size of the company present state, the ability and durability of Valve to continue to deliver their product given their current company structure are questionable.

3. Analysis

Valve’ organisation structure problems in this report will be put into focus within a wider context of vertical organisation structure and horizontal organisation structure. As profitable and sustainable growth requires an organisation design that emphasising in productivity, effectiveness and efficiency (Raisch 2008, p 483).

3.1 Vertical Organisation structure.

Vertical organisation structure companies have a chain of management, usually with a CEO at the top making decisions...
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