Assignment Sample on Organizational Management
1. Introduction
- Aim of the study is to analyze the organizational structure and business strategy of this company named GlaxoSmithKline (GSK).
- This organization follows hierarchical structure with multi-levels that assist to create suitable communication between employees and departments.
- The organizational structure of GSK helps to achieve the goals and objectives of this company.
- A good and well-established organizational structure provides support and guidance to all employees by maintaining the relationship between hierarchy and employees.
Organization structure provides a clear explanation of authority as well as it helps all companies to understand their goals and objectives clearly. Besides that, it is responsible for company growth and diversification of activities of organization. The innovation of new policies and overcoming of issues become easier with the help of organizational structure.
2. Historical and theoretical basis of organizational structure
2.1 The importance of organization structure
- As suggested by Jahan (2018), GSK follows a hierarchical structure that provides benefits to business and business profits and the annual revenue of this company is improved by this.
- It aids to understand the roles and responsibilities of all employees and staff that helps to meet the requirements of the company as much as possible.
The hierarchical organization structure helps to establish the clear authority of every department and works of GSK. The communication between higher authority and employees are improved with the help of hierarchical organizational structure. This permits all employees to perform their works successfully without facing any issues.
Administrative theory of Henri Fayol
- As opined by Edwards (2018), this company named GSK follows administrative management theory that helps in planning, organizing, commanding, and controlling, business strategy of company.
- As per this theory, the business operation of this organization has three broad activities such as technical, commercial, accounting, financial, managerial and security (Narula, 2020).
Administrative management theory helps the company to meet the goals and requirements of this company. Besides that, this theory provides a clear explanation of the division of labour, the authority of the company.
2.2 Formal organization structure
- The formal organizational structure is encoded as a hierarchical organization that refers to the arrangement of the relationship between department and organization.
- A formal organisational structure is needed in order to maintain as well as control huge numbers of employees along with various business activities and formalities (Jonathan et al. 2018).
The relationship between different activities and departments of organization is balanced by formal organization structure. In addition, it provides stability to organization through rules, regulation and policies. The activity of organization, workflow, authority, communication all is maintained by formal organizational structure.
2.3 Informal organization structure
- Informal organizations structure is closely related to human psychological needs while formal organizational structure is closely related to the meeting goals and objectives of the company.
- Informal organizational structure does not have any higher authority and structured work process as well as this is not structured due to not having proper goals.
Non-formal organization structure promotes communication along with providing satisfaction to all employees. Usually, it provides psychological and social benefits to all employees of the organization. One of the most important advantages of informal organization structure is that all employees communicate with each other without facing any issues.
2.4 Organizational effectiveness
- GSK is a very popular and growing pharmaceutical company in the UK and it expands its business around the world.
- The profit of this company is almost 34.1 million BP according to the year 2020 (Nyambu, 2018).
GSK works with innovating rare drug-disease as well as the development of oncology that is the great competitive advantage of this company and this aids the company to improve business profitability and revenues. The growth and sustainability of the company in the pharmaceutical market are improved by these competitive advantages.
3. Analysis of the relationship between organizational structure and business strategy
- The organization structure is related to process, culture, position, technology, and other related elements of organization.
- An organizational structure helps to develop the business strategy and the organization structure is changed based on changing organization while changing organization cannot change business strategy of the company (Whetsell et al. 2020).
Usually, the organizational structure and business strategy of GSK both are interrelated to each other. This company has a good business strategy that helps to achieve the goals and objectives of GSK. Furthermore, sustainability along with profits and revenues are improved by this well business strategy.
- As argued by Zollo et al. (2019), the organizational structure of GSK is responsible for managing workforce of the company based on different departments.
- Business strategy consists of planning and organizing for entire company’s better growth and development.
- Organizational structure of GSK highlights the activities of hierarchy while business strategy includes setting and planning in order to achieve goals and make right decision for company growth (Gochhayat et al. 2017).
This company named GSK follows cost leadership strategies that help to manage operating costs and production costs of company. Furthermore, it provides better profits for organization along with increasing market share. The cost leadership strategy creates more capital for improving growth and sustainability of this company.
4. Conclusion
- It is concluded that GSK is a growing pharmaceutical company that follows hierarchical organizational structure that means formal organization structure.
- It helps to manage all the business responsibilities and employees of organization as much as possible.
- The activity of the company depends on the organizational structure of the company.
- The business strategy of an organization helps to set the goals and objectives of the company as well as helps in business planning for better growth and sustainability.
The hierarchical organization structure helps to explain the roles and responsibility of all employees. The company tries to innovate various rare disease drugs and drugs for cancer and these are great competitive advantages of this company. Business strategy helps this company named GSK to understand the strengths and weakness and it provides opportunities in order to develop the profit and revenues of this company. Furthermore, it has been criticized that the vision, mission of the company as well as direction is created by business strategy.
References
Edwards, R., 2018. An elaboration of the administrative theory of the 14 principles of management by Henri Fayol. International journal for empirical education and Research, 1(1), pp.41-51.
Gochhayat, J., Giri, V.N. and Suar, D., 2017. Influence of organizational culture on organizational effectiveness: The mediating role of organizational communication. Global Business Review, 18(3), pp.691-702.
Jahan, I., 2018. GlaxoSmithKline Bangladesh Limited (GSK) (Doctoral dissertation, Daffodil International University).
Jonathan, G.M., 2018. Influence of organizational structure on business-IT alignment: what we do (not) know. In 17th International Conference Perspectives in Business Informatics Research (BIR 2018), Stockholm, Sweden, September 24-26, 2018 (pp. 375-386). CEUR-WS. org.
Narula, V., 2020. Unit-5 Henri Fayol. Indira Gandhi National Open University, New Delhi.
Nyambu, N.M., 2017. Critical Success Factors That Affect Lean Management Systems Implementation in Manufacturing Companies-A Case Study of Glaxosmithkline (GSK) (Doctoral dissertation, United States International University-Africa).
Zollo, L., Laudano, M.C., Boccardi, A. and Ciappei, C., 2019. From governance to organizational effectiveness: the role of organizational identity and volunteers’ commitment. Journal of
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