Organizational Restructuring Case Study
Although the business will have to pay redundancy packages to those workers who are losing their Jobs, in the long term it will be cost beneficial to the business as they will no longer be required to pay those workers’ wages. This should in turn improve the financial position of the business as its overall costs are being reduced. With that, the business’ profits should see an increase. Delivering will also help improve the speed of decision making within the business.
DE plans to remove two management levels from the organizational structure.
This Is likely to alter the business’ hierarchical structure from a tall structure to a flat one. This will mean there are fewer levels In the hierarchy and therefore a shorter line of communication. This allows for quicker decision making as it takes less time for a message to make its way from the bottom of the hierarchy to the top. This will be greatly beneficial to the business as it will improve efficiency and overall, employees will be able to get things done quicker.
Peter also mentions how he believes the business has to respond quickly to market changes.
A hierarchical structure that allows for quicker decision making will definitely cater for this wish. Another reason why I agree with Peters decision to implement delivering into the business is that it will allow for greater empowerment to the business’ employees. This will happen as the result of there being fewer managers in the business. If there are less managers and less layers in the hierarchy, those employees lower down in the hierarchy will be given more power and more responsibility.
This can be very inefficacy for DE as It should Improve motivation within the workforce.
If Deed’s employees are given greater responsibility and more power within the business, they are likely to feel a lot more valued and trusted, and thus feel motivated to work harder. A motivated workforce is incredibly important for a business as motivated employees are going to be a lot more efficient in their work than denominated employees. A denominated workforce could be very inefficient in their work and could be prone to making mistakes and costing the business money.
Peter has stated how he believes the current managers don’t listen to the ideas of the workforce enough. This is likely to change as a result of delivering with the workers having greater power as It will mean more people will listen to them.
However, delivering for DE could have some drawbacks. The business plans on losing 10 highly experienced managers. This could affect the business’ decision making as the empowered workers may not be used to making Important decisions regarding the business, and may therefore make incorrect ones.
If this is the case, the business will have to pay for trailing, Tort Its employees, on good calicles making . Nils wall nave a detrimental effect on the business’ costs and will also mean the employees having to take time out of their existing Jobs to undergo the training, potentially causing the productivity of the business to drop.
Overall, I believe delivering will be beneficial for DE, especially with Pewter’s desires. He wishes to reduce costs and improve the speed of decision making within the business.
Delivering will allow for this as it will reduces he business’ wage costs and decrease the amount of layers in the hierarchy, thus reducing the line of communication. Remaining workers will also feel empowered as a result of delivering and therefore might become more efficient in their work due to an increase in motivation. DE will however have to take into account the drawbacks that come with delivering, such as the fact that they will be losing 10 experienced managers.
The existing workforce may also become denominated due to them being worried that they may be made redundant due to business changes in the future.