1. Before C&C’s reorganization, why was its performance poor? To examine the poor performance before C&C’s reorganization, it’s essential to look at the structural and contextual dimension in the organization. This approach helps to reveal what the problems were, and where the problems arose in the organization. (Daft, 2010:20)
C&C’s structural dimensions before the reorganization
First of all, C&C had a tall organization, with narrow spans of control and centralized authority. The authority to make decisions was kept at the top-level. There were seven levels of authorities within the company: President Cummins, five Vice Presidents, five Vice Regional Presidents, District Director, District Managers, Merchandisers Specialists, Store managers and finally Department Managers. The store manager didn’t have enough authority regarding development of the stores. According to Mintzberg, C&C also was an organization with a diversified form, in which each region was considered as an independent division with the different bureaucracies. The diversified form normally helps to solve the problems of inflexibility when the machine bureaucracy was too large. But in fact, because of the machine bureaucracy in each region, C&C was slow to adapt the changes in the environment. Because this form is suitable for the simple and stable environment, not a dynamic one which C&C had to face in recent years. Moreover, the hierarchy in the organization tended to generate a high level of formalization, which made each department too separated, and unfortunately affected the collaboration between the departments and the managers in a negative way. This is illustrated through the following: There are four main parts of each district in C&C: grocery, meat, store and produce. These parts worked separately and reported directly to the higher-level authority. Therefore they did not have any cohesive connections to one or another. These difficulties seemed to lead to inefficiency, as the information flowing throughout the organization was slow, which disturbed the level of performance.
C&C’s contextual dimensions before the reorganization
An examination of the contextual dimensions gives us a deeper insight of C&C. Goals and strategies in general, are defining the purposes and the comparative advantages of an organization. When a company shows poor performances, it is an expression of unachieved goals. C&C had clear strategies at the beginning, but how come, that the strategies failed in achieving the goals of C&C? We believe that problems regarding the strategy were provoked in the implementation-process of the it in the organisation. This argument can be observed in example of the new technology that was bought for C&C, but not used in a suitable way. An organization exists when “…people interact with one another to perform essential functions to attain goal”(Daft, 2010:11). If the goals are not implemented throughout every levels of the organization, and the interaction between the different departments is poor - this can affect the perception of which goals, they were trying to reach. Moreover, it also showed that the problems in structural dimension of C&C had a strong impact on the contextual dimension. Besides, it is not difficult to realize that the “human side” isn’t taken into account in the management of C&C. The hierarchy is too heavy, the operating management only outlives a control and supervision function, rather than offer development and training to employees and coordinate the activities. From a behavioural management point of view, C&C do not apply the “Human relations movement” which “advocates that supervisors be behaviourally trained to manage subordinates in ways that elicit their cooperation and increase their productivity”. Consequently the employees’ only feel controlled, and they lack of motivation and cannot cooperate and increase their productivity. Furthermore, C&C...
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