- Use electronic and non-electronic sources to find out how Dell utilized its different kinds of organizational structures over time in capturing the following performance area:
- Motivation / Goal Setting Process
- Decision making/ Problem solving process
- Conflict Resolution
- Team building/ team process
Reg No
Designation
Dell utilized its different kinds of organizational structures over time in capturing motivation and goal setting process, decision making, conflict resolution and team building in the following manner.
Motivation / Goal Setting Process
The functional structure of Dell adopted in the 1990’s was useful in motivating its rapidly growing employees. The divisional structure of Dell adopted in 2000’s was very useful in handling the customer base expansion. Divisional structure is the most common structure that is found in many organizations. Delegation of authority is the biggest advantage of the divisional structure that enables performance evaluation in an easy manner. This aspect of measurement and performance evaluation motivates the employees and the managers to perform better increasing their morale. Divisional structure allows motivation of employees by developing employees in a specialized area. Specialization is given importance in the divisional structure. Finally dell moved to outsourcing and delegation making its structure simple to manage competition.
Decision making / Problem solving process
In the initial stages of operation, Dell used the functional structure effectively to boost the sales by managing employees in an effective manner. Functional structure is best suited for small companies focusing on a single service or a product (Dana Griffin, 2010). Decision making is made by a single authority in this structure especially the top management and Mr. Dell was taking decisions for the company in this structure. The decision making in a functional structure becomes bureaucratic with all controls lying in the same place with the increase in number of levels. Decision making is difficult in this functional structure taking a long time.
Divisional structures enable a simple process of decision making by coordinating the various business activities in a local manner by adopting a market based or geographic area based division (T Ashraf, 2010). Divisional structure enhances decision making through departmentalization and delegation of authority (Oscar Guzman, 2010). In the 2000’s the company adopted the Divisional structure focusing more on customer service and customer satisfaction. The company sales grew by $35 billion with a profit margin of $3 billion (Dell Company Business overview, 2013). This was the outcome for Dell by adopting the divisional structure.
Conflict Resolution
Communication becomes a problem in the functional structure between the departments leading to delay in project completion. In the functional organization structure, the Dell Company was able to attain its core competency of achieving cost leadership. Dell became the low cost PC maker by adopting the functional organizational structure which acted as the best method of conflict resolution. Flexibility in command and control helps in conflict resolution to a great extent in divisional structure.
Team building / team process
Functional units were developed with employees possessing similar skills. The coordination of these units was done by Mr. Dell. These functional units acted as teams in this structure.
Divisional structure helps in responding to the market in a fast manner with efficient work coordination between departments or divisions. Employee skill development and team building is very effective in the divisional structure. Communication is highly enhanced between the departments in a divisional structure. Divisional structure is very effective in resource coordination with teams being delegated and held responsible for each of the tasks.
Team building is achieved through the simple structure and finally in the outsourcing and delegation methods adopted by Dell, Team building was the major emphasis. Finally, Dell moved to a simple structure with outsourcing and delegation that helped the company to customize their products according to customer preferences. Outsourcing was used to regain the cost leadership that was lost to the competition.
References
- Charles W. L. Hill, Gareth R. Jones. (2012). Strategic Management Theory: An Integrated Approach, 10th edition, Business & Economics publication. ISBN 1133485707
- Dana Griffin. (2010). Functional Organizational Structure Advantages. Demand Media publication
- Dell Company Business overview. (2013). Available online at http://www.dell.com/learn/us/en/555/solutions/premierconnect-benefits
- Oscar Guzman. (2010). The Advantages of Matrix Organizational Structure. Demand Media publication
- T Ashraf. (2010). Dynamics of working together. Prentice Hall edition
