What Should Companies Consider When Determining The Degree Of Decentralization Age Of The Lean Organization

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Age Of The Lean Organization

Organic organizations are characterized by a set of structural arrangements, such as a low degree of formalization in specifying work responsibilities, an almost complete lack of division of activities to be performed, few rules, significant lateral communication with few hierarchical distinctions, and finally, decentralization of decision-making processes.

Comparable to the Lordship of Mintzburg. The flat and organic structures of post-bureaucracies make them creative and able to adapt to the variety of new problems they face.

Generally to date we have seen various government bodies in the UK trying to become more organic organisations. However, in many cases of lost sensitive information such as personal bank details, residence and other personal information stored in government databases, lack of process and strict procedures are evident. This more formal mechanistic organizational structure is still best suited to government agencies and other areas of the public sector. This is particularly important for agencies handling sensitive personal information.

Other organizations in the public sector such as PR or tourism organizations can deploy a more organic structure that makes the business flexible and reduces the number of layers in the organizational structure. In this case the role of managers becomes one of empowerment, providing workers with information, training, authority and responsibility for excellence.

Tom Burns and GM Stocker, (1961) are famous for establishing the difference between mechanistic and organic approaches to organization and management. He explained that when environmental change becomes the order of the day, as technological and market conditions change to create new problems and challenges, open and flexible styles of organization and management are required (Morgan, 2006).

Management is seen to engineer an organizational culture and identity, which motivates individuals to take responsibility for rationalizing and intensifying their own work activities, i.e. “working smarter to work harder”. The target of this control is not the individual’s behavior but their emotional commitment, way of thinking and identity.

Flatter structures reduce the number of promotion opportunities, and the consequences of ongoing restructuring include insecurity and increased workload. These changes are affecting people’s morale, motivation and desire to perform higher.

Case Study – Lesport Hotel

The establishment has all the services and facilities you would expect at a four star Caribbean resort as well as spa treatments, therapies, fitness and relaxation classes, water sports etc. in an all-inclusive package.

The former organizational structure can be classified as traditional machine bureaucracy with high hierarchy and high centralization. Decisions were taken at a strategic summit consisting of departmental heads such as Rooms Division Managers, Deputy General Managers and General Managers.

In order for organizations to gain a competitive advantage in today’s market, which offers endless options, flexibility in their product and service delivery is essential. This can be achieved through a lean decentralized organizational structure that can adapt to the environment and ever-changing technological advancements.

Finally the days of traditional bureaucracies in the private sector which can be very expensive to maintain and unable to meet the needs of employees are over. The hospitality industry and LeSport’s organization as fundamentally postmodern, as employers, employees and guests engage each other in discovering truths that will shape their own beliefs and realities.

No two organizations will be structured the same as there are many factors to consider. However, it is clear that an organization must maintain a certain hierarchical level for a business to effectively deliver its products and services. Unnecessary bureaucracy should be reduced and centralization should be kept to a minimum wherever possible. Excessive flattening and decentralization can cause organizations to fail without control and power structures in place.

Organizations should support structural change with strategies that address employee needs, improve communication, integration, knowledge, and provide opportunities for learning and career development to attract and retain the best employees. A leader must be nurtured and is critical to creating a positive work environment, motivating and developing employees, leading by example and being an ambassador of the organization’s values.

It can be argued that the structural change enabled the organization to gain a competitive advantage. Ultimately, in the hospitality industry it is the quality and organization of our human resources that has the greatest impact on an organization’s value, products, services, repeat business and reputation.

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