Fabulous Footwear Case Study
The structure of an organization is a crucial aspect of the company. It is meant to specify official prescribed titles, reporting authorities /formats within hierarchical levels, and the designation of control. Organizational structure guarantees the gathering of people into sections based on their assigned responsibilities; these are mainly exhibited in the organization chart. The purpose of an organizational structure is to establish the design of a system that enforces operational interaction, management, and incorporation of a coercive departmental effort across the organization. The organizational structure involves three significant aspects:
- It assigns official ranks and reporting relationships.
- Identifies the classification of persons into different departments.
- It supplies tools for connecting and organizing structural components into a reasonable entirety (Daft, 2020).
Piezunka & Schilke (2023) viewed organizational structure as a tool for decision-making and summation of votes. While Iranmanesh et al., (2021). defines organizational structure as a display of authority, obligation, reward distribution, task allocation, and chain of command, which should be precisely followed for communication purposes.
Fabulous Footwear Organizational Structure
Fabulous Footwear has a divisional organizational structure in which employees are grouped into several departments or segments based on the company’s products. Top management makes most of the decisions regarding shoe design. The styling manager, M. T. Lawson, works closely with his designer, John Flynn when designing a new shoe sample. They usually get their ideas by reading fashion and trade publications, replicating superior designers’ models, and personalizing them to fit their business. It takes about two weeks to a month for a design to be agreed upon. In this organizational structure, every product approval comes from the president, which can be very tasking because they oversee every other department. Their time constraint can result in delays in the approval of shoe design, hasty decision-making, and errors that might eventually cost the business (Daft, 2020). According to Islami et al. (2021), the divisional structure depends on the basis of the product sold for arranging divisions at different rankings. Sections align with the markets supplied and are prescribed control over the operational responsibility that the markets need to service their customers.
The Structure is Inappropriate for Its Frequent Changes in Shoe Styles.
Fabulous Footwear designs and sells less expensive female shoes than other companies; they average about $27.99 to $29.99 per pair. Due to the current uprising in labor and material costs, their profit margin presently averages 25 to 30 cents per pair, compared to ten years ago, when it was around 30 to 50 cents per pair. It is obvious that the company currently has issues regarding its rising employment and material prices, a stiff decrease in revenue, and enhanced competition. With the current divisional structure and competitive market, the company’s growth is hindered due to its current structure. The bureaucracy involved before introducing a new product to the market slows the process. Putting a specific design into manufacturing involves approval from numerous vital individuals. The standard period from when Lawson, the styling manager, decides on a design before the Centerville factory is notified to manufacture the first model takes about two weeks to a month. If the team could increase the velocity of the process, Fabulous Footwear would have a competitive advantage and improve its profitability, sales, and designs. This would take care of some of the endless bickering among people around here involved in the styling phase of the business if the structural design can be changed (Daft, 2020).
Recommended Structural Changes
Fabulous footwear would benefit from initiating an ambidextrous approach to integrate structures and organization procedures that are significant for new designs and advancement. Instituting an organic structure that decentralizes and gives autonomy to employees is tremendous for introducing new concepts. Annosi et al., (2022). defined ambidextrous approach as a process focused on managing the constant alignment of customers’ demand in line with the market. Ambidexterity is currently a popular subject in organizational studies. The ambidextrous approach is considered a fundamental design practice critical for discovering new ideas and exploring modern fashion skills. Exploring new designs/skills is essential because it urges innovation and the development of new ideas, leading to implementing those ideas to manufacture new lines of products.
I also recommend a bottom-up approach. Modern corporations recognize that many valuable concepts originate from the front-line workers due to their constant interaction with customers and the products; they understand the need and how best to serve customers and get their jobs done. Fabulous Footwear would do way better if it changed its organizational structure to be more decentralized. According to Zaczyk & Silesian University of Technology (2023). a decentralized organizational structure allows employees to contribute to the decision-making process. Such that all the choices are not made by only the top individuals in the hierarchy. In this type of structure, Fabulous Footwear will be able to move fast in creating a new design because a lot of the bureaucracy will be avoided. Employees in this structure have more independence, permitting them to make choices that would positively influence the business (Zaczyk & Silesian University of Technology, 2023).
Incorporating New Information Technology as the CEO
If I were the CEO, I would get my employees to use the new information technology by instituting an organic company that encourages employees to be independent and feel supported in their innovative thinking. Organic corporations foster a bottom-up improvement process where technical and professional employees, like research and engineering, can analyze complications and create resolutions. Companies use several peculiar methods to sustain an ambidextrous tactic while fostering a bottom-up movement of thought by “switching structures, separate creative departments, venture teams, corporate intrapreneurship, and collaborative teams” (Daft, 2020, p. 490). God, in his infinite mercy, gifted everyone with specific skills that are tremendously important, as stated in Exodus 35:35: “He’s gifted them with the know-how needed for carving, designing, weaving, and embroidering in blue, purple, and scarlet fabrics and fine linen. They can make anything and design anything” (The Message, 1993/2018). These skills are meant to be used in our respective places of work to display God’s goodness and generosity in our lives. It should not be suppressed by structure or management styles.
I would also create a distinct functioning section responsible for creating new technical designs by launching project groups for incubating new ideas. This idea incubator would supply a secure environment where employees are empowered to think innovatively without any company philosophy or bureaucracy limitation. As the CEO, I know my place and cannot do everything by myself; that is why I have other trusted team members to lead their teams (Daft, 2020).
References
Annosi, M. C., Marzi, G., Ciampi, F., & Rialti, R. (2022). An ambidextrous approach to practice-based innovation for social product development: Lessons from A Dutch company. IEEE Transactions on Engineering Management, 69(2), 376-387. https://doi.org/10.1109/TEM.2020.2977976Links to an external site.
Daft, R. L. (2020). Organization Theory & Design (13th ed.). Cengage Learning US. https://mbsdirect.vitalsource.com/books/9798214350…
Holy Bible: The Message. (1993/2018). Exodus 35:35. Bible Gateway. Retrieved June 27th, 2024, from https://www.biblegateway.com/passage/?search=Exodu…
Iranmanesh, M., Kumar, K. M., Foroughi, B., Mavi, R. K., & Min, N. H. (2021). The impacts of organizational structure on operational performance through innovation capability: Innovative culture as moderator. Review of Managerial Science, 15(7), 1885-1911. https://doi.org/10.1007/s11846-020-00407-yLinks to an external site.
Islami, E., Sejdiu, L., Hajdini, A., & Imeri, V. (2021). The role of departmentalization, divisional structure, and strategic business units (SBUs) in enterprises in Kosovo. Calitatea, 22(183), 18-22.
Piezunka, H., & Schilke, O. (2023). The dual function of organizational structure: Aggregating and shaping individuals’ votes. Organization Science (Providence, R.I.), 34(5), 1914-1937. https://doi.org/10.1287/orsc.2023.1653Links to an external site.
Zaczyk, M., & Silesian University of Technology, Faculty of Organization and Management. (2023). The concept of a decentralized autonomous organization as an innovative organizational structure. Scientific Papers of Silesian University of Technology. Organization and Management Series, 2023(174), 431-445. https
