This report will evaluate the concepts of organisational structure and organisational culture along with the environmental impacts which affect them. The report will then relate the concepts to The Buttermere Country House Hotel.

University Degree Business and Administrative studies

0900421 09/03/2011

Introduction

This report will evaluate the concepts of organisational structure and organisational culture along with the environmental impacts which affect them. The report will then relate the concepts to The Buttermere Country House Hotel. ‘Globalisation has led to acceleration and vast change not only in technology and work processes, but also in organisational culture and structure’ (Sinangil, 2004). Globalisation has also led to multicultural workforce with many staff with different culture and background along with varying social, racial, and ability characteristics (Reference for Business, 2011). The prior references are few of the reasons of varied organisational structure and culture concepts in organisations worldwide. Understanding the elements that relate and hence influence the organisational structure and cultures worldwide, it is important to understand the influence of globalisation. Some of the factors that impact on globalisation are increasing free trade, technological advancements, rise of developing economies, transport is cheaper and quicker plus the removal of capital exchange controls globally (Tutor2u, 2010, Globalisation).

1.1 Overview of the Buttermere Country House Hotel

Buttermere Country House Hotel is an independent luxury hotel catering for all kinds of customers located in the English Lake District. The hotel is owned by the Lockett family. Mark and Linda are General Managers and Malcolm the son is in charge of spa and treatment centre. The hotel offers accommodation and catering/hospitality along with indoor and outdoor facilities/services (University of Bolton, 2011).

1.2 Organisational Structures

Organisational structures can be varied depending on organisations objectives/goals and impacts of organisational culture. The structure of an organisation will establish the method in how it will perform and operate to maximise success. A good structure clearly allocates and clarifies responsibilities of employees and departments. This analysis has been supported in the work of Adler (1997).The management within an organisation is very important as it creates a structure within which people work together to achieve success and directed towards company aims and objectives (Mullins, 2002). Mintzberg (1979) cited in Drucker (1999) emphasises the important acquaintances between an organisations age, size, strategy, technology, environment and culture and its structure. Mintzberg suggests four basic structures within an organisation (See Figure 1 Appendix).

The structure within individual firms varies; some are flat structure, these are simpler with fewer sections of hierarchy and adapted mostly by smaller firms (See Fig 2 Appendix). The flat structures have fewer levels of management and broad span of control; this means fewer numbers of employees that each manager/supervisor is responsible for (LearnManagement2, 2010, Structures). The flat structure is much more adaptable with greater involvement of employees so better communication and creativity, this creates greater team spirit. They perform better in active business environments since they react quickly to these trading shifts (Grant and Kramer, 2006). Flat structure is a decentralised approach along with being an organic system (See Fig 3 Appendix) because of the strong leadership, communication and little bureaucracy however the structure limits the growth of a company and many employees have to multitask. To increase the growth the firms later on adapt a tall structure (Mullins, 2002). Organic and mechanistic are diverse systems. According to George and Jones (2005) organic structure is used to portray an organisational structure that is intended to promote flexibility so that employees have power to make decisions and has a team environment whereas the mechanistic system is designed for employees to follow rules and directions plus follow assigned duties only. The systems were examined by Burns and Stalker in 1961, where they analysed twenty industrial UK firms to understand which system was utilised and how it was fit for change or specific circumstances (Boddy, 2002).

The opposite of a flat structure is the taller structure (See Fig 4 Appendix). The structure is seen as a centralised approach or a mechanistic system (See Fig 3 Appendix). The taller structure is a more formal structure with many levels of hierarchy. The multiple levels of management control decision making processes and employees within the organisation. The decision making is slower even though it has a clear management control however employees have freedom restricted with limited empowerment, and this can also affect communication. In general tall structures tend to be less responsive to the environment however they still ...

This is a preview of the whole essay

The structures in tourism industry are important because tourism is intangible; this means tourism is mainly service oriented so having a good efficient structure is important along with perishability being a tourism feature; this mean products which are not sold today cannot be stored for tomorrow. In tourism, customers are very important as they buy the product/services so companies make alterations to keep up with customer needs plus many services in tourism are inseparable. Lashley and Lee-Ross (2004) believe as tourism is a service oriented industry. A successful, efficient organisational structure is needed, which provides excellent service quality to the customers. Lashley and Lee-Ross (2003) state ‘organisational structures are the formal pattern of interaction and co-ordination that managers design to link the tasks of individuals and groups to achieve organisational goals’. Another element is seasonality within tourism; this means many tourism services are seasonal and require seasonal staff so in peak periods alterations to structures should be made plus heterogeneous; so every experience will be different for customers and the companies would like consistency in their service.

2.0 The Buttermere Hotel Organisational Structure

The Buttermere hotel utilises a flat organisational structure mainly because of its size plus being a family run hotel with some family members as staff. The hotel hires 22 permanent staff compared to a Marriot Hotel; which employs 140,000 staff worldwide (Marriot Hotel, 2010), this means the cost of the employees is less plus having a broad span of control means better communication and team spirit within the hotel this clearly clarifies a successful flat organisational structure. The owners encourage empowerment and have an approachable management however maintain strong leadership overall. The senior managers maintain monitoring role along with making decisions; this suggests a mixed decentralised and centralised approach by the hotel. The owners encourage creativeness along with interaction between all staff and consider the staff as loyal and precious (University of Bolton, 2011). The owners prefer an organic system overall and adapt a flat structure throughout with superior accomplishment and this is proven by the success of the hotel and premium status however to expand for future they would need to gradually adapt a more taller structure so they can employ more staff and departments however they can still utilise an organic system; this has been beneficial to the hotel but if it is to become a huge chain then gradually it would alter to an mechanistic centralised approach nevertheless this would also be dependent on the organisational culture within the hotel .

2.1.1 Organisational Cultures

The culture within an organisation has become a very important aspect even more than before due to globalisation, increased competition and technological, Schien (1992) cited in Jones (1993). The author believes the key is to manage the culture within the organisation effectively so the employees work as a team successfully and the organisational structure is effective; this can be achieved by greater flexibility and adaptability utilising an organic system within the organisation, such as Buttermere Hotel. ‘Organisation culture has an important influence on strategies and their success. Managers often overlook or ignore organisation culture as a tool in their strategic armoury’ (Dwyer et al., 1999, 2000). Schein (1988) defined culture as ‘learned responses to the group’s problems of survival and internal integration. According to him, norms, values, rituals, and climate are all manifestations of culture’. Schein came up with the 3 levels of cultures model (See Figure 5 Appendix). The basic underlying assumptions; these are the unaware belief, perception or feelings that the staff of an organisation have regarding their culture. The second level is the organisations norms and values; these generally are in written form and are basic plus theoretical. The final level is Artefacts; these are to do with the organisational structures and processes and understanding, Schien (1988) cited in Bohinc (2003). According to’ Michela and Burke (2000) cited in Sinangil (2004), there are two forms of culture and quality. The first type is traditional management where employees are given job descriptions and highly task oriented rather than individual values or concerns, the second type; value based management begins with the analysis of the values and norms and builds leadership. Organisations such as Buttermere Hotel follow the value based management style by giving directions to their employee’s not in literal terms but in terms of objectives, goals or desires plus provide incentives. Another theory that identifies organisations according to their culture can be categorised into prospector vs defender (See Figure 6 Appendix). These were formed by Miles and Snow's (1978) cited in Adler (1997). These two are at each end of a continuum, defender are organisations that are constricted with being under cost control and good production quality however inflexible and mainly bureaucratic whereas a prospector organisation is wide and diverse with a flexible structure however efficiency is lower. The Buttermere Hotel runs with a mixed approach from the author’s point of view because the owners have everything stable top to bottom however the hotel is under cost control but still provides good customer service and production whilst being flexible.

2.1.2 External and Internal influences on structures and cultures

External and internal factors need to be considered before undertaking a particular structure or culture. The size of the organisation is important as Hilton Corporation has 3,600 hotels in 81 countries/territories (Hilton Worldwide 2011, About us) and would employ a tall organisational structure whereas a local motel would design a flat structure to keep the cost at a minimal. Another factor would be geographical distribution along with language and communication. If a company is involved with international customers then having an international communication department and employees would be ideal plus the culture within the organisation needs to be considered to maintain a feasible structure. Technology is also an important factor for both culture and structure because many tasks can be accomplished now using tools, equipments rather than utilising humans due to technological advances (Schein, 1988). Organisations have different management styles and ownership; this can impact on structures and cultures because private companies would provide more competiveness through assigning targets, bonuses and this would create a competitive behaviour. Organisations will have regulations/policies that have to be maintained and these could be to give priority to locals however government regulations would also need to be considered before employing staff or a structure.

The demands of the tourism industry require greater flexibility plus improvement by providing cultural education and training. The bureaucratic culture and structure within an organisation creates conflict and undesired challenges and because of this the structural alteration and cultural alteration should be considered, such as increase empowerment and flexibility along with providing cultural education plus team work training.

2.1.3 Cultural Web The main influence on the culture is seen through the cultural web theory (See Figure 7 Appendix). The Cultural Web identifies six unified essentials that assist to make up the paradigm. The web analyses the factors to help with cultural differences in a workplace and how to make changes and improve (See Figure 8 Appendix). The paradigm is utilised to see the potential of an organisation and how it compares to the six elements then improvements can be (Mindtools 2011, Cultural Web).

2.1.4 The Buttermere Hotel Culture Organisation The Buttermere Hotel has a very inspiring culture within the hotel. The hotel has 30% overseas workers and only 15% UK workers and by recognising the staff as most important resource by being flexible and providing rewards, empowerment and recognition the multicultural staff team express a sense of team spirit, and being valued and recognised for good performance as very important; this benefits the hotel and has the potential to be more successful in future (University of Bolton, 2011). The hotel adapts the cultural web to a great extent and by providing good training and development the mix cultured staff can adapt to each other; this is encouraged by the organisational structure they utilise. The staffs low in authority has permission to make decisions along with freedom and this is a good encouragement and creates stability and ensures culture, values and laws are respected, which should eventually result in better customer service, team spirit and better future for the hotel.

2.1.5 Conclusion Overall, globalisation is the main influence on organisational structure and cultures. A stable, functioning structure is needed however the culture within the company would determine which structure to utilise. The culture moves the organisation ahead in a convenient system because it decides the jobs that have to be completed and the distribution of labour within the company. The structure may establish the positions however it’s the culture, for example, that says women will do the actual work and men will make the decisions.

This report has shown the essential importance of organisational structure and organisational culture from a global perspective and considering the tourism industry. This was done by a series of sections. The first part introduced globalisation followed by a brief overview of the case study, and this was followed by an evaluation of organisational structure relating it to the case study. Next, another element of the report evaluated the organisational culture element relating it to the case study, throughout the report key theories, concepts and models were utilised and conclusions on importance of organisational structures and cultures were discussed.

References

Adler, N. (1997) International Dimensions of Organisational Behaviour. 3rd Ed. Ohio: South Western College Publishing.

Bohinc, T. (2003) The strong effects of the soft factors of knowledge management [online]. 9 (7), pp. 570-575. Available from: <http://www.jucs.org/jucs_9_7/the_strong_effects_of/Bohinc_T.html> [Accessed 4 March 2011].

Boddy, D. (2002) Management: An Introduction. London: Prentice Hall.

Drucker, P. (1999) Management Challenges for 21st century. New York: Harper Business.

Dwyer, L. Kemp, S. (2001) An examination of organisational culture-the Regent Hotel, Sydney. International Journal of Hospitality Management [online]. 20, pp. 77-93. Available from: <http://elearning.bolton.ac.uk/file.php/4109/Kemp_Dwyer_2001_An_examination_of_organisationl_culture.pdf> [Accessed on 6 March 2011].

Globalisation. (2011) External environment on Globalisation [online]. Available from: <http://tutor2u.net/business/external/globalisattion_intro.htm> [Accessed on 7 March 2011]

Grant, J. Kramer,R. (2006) Role of Organisational Structure. The international Journal of Knowledge, culture and change management, 7 (9), pp. 210-220.

George, J. Jones, G. (2005) Understanding and Managing Organisational Behaviour. 4th Ed. London: Prentice Hall

Hoczynski, A. Buchanan, A. (1991) Organizational Behaviour: An Introductory Text. London: Prentice Hall

Hilton Worldwide (2011) [About us] [online] Available from: <http://www.hiltonworldwide.com/aboutus/index.htm> [Accessed on 6 March 2011].

Lashley, C. (2003) Organisation Behaviour for Leisure Services. Oxford: Butterworth-Heinemann

Mindtools (2010) [Cultural Web] [online] Available from: <http://www.mindtools.com/pages/article/newSTR_90.htm> [Accessed on 6 March 2011].

Mullins, L. (2004) Management and Organisational Behaviour. London: Prentice Hall

Multicultural. (2011) Multicultural workplace [online]. Available from: <http://www.referenceforbusiness.com/encyclopedia/mor-off/multicultural_workforce.html> [Accessed on 6 March 2011].

Marriot Hotel (2011) [About is] [online] Available from: < http://www.marriott.co.uk/default.mi > [Accessed on 6 March 2011].

Peters, J. (1993) On Structure: Management decision, 31 (5) pp. 60-62.

Schein, E. (1988) Journal of Organisational Change Management. Organisational Cultures, 10 (3), pp.202-216.

Sinangil, K. (2004) Psychology developing societies. Globalisation and managing organisational culture change [online]. 16 (4), pp. 27-40. Available from: <http://pds.sagepub.com/content.16/1/27 > [Accessed on 6 March 2011].

Structures. (2010) Organisational structures [online] Available from: http://www.learnmanagement2.com/organisational_structures.htm [Accessed on 7 March 2011]

University of Bolton (2011) Case Study: The Buttermere Country House Hotel, Bolton: University of Bolton