2 Responses 10/21

Gowtham Work:

Today I will be discussing the structure organization of Verizon’s top management team. Verizon has an operations-based divisional organization structure (Gregory, 2018) and its management team is basically organized into functional groups for running the operations and corporate functions. The primary business groups are typically categorized based on the customer groups, which include Verizon Consumer Group (VCG) and Verizon Business Group (VBG). The centralized functions are Administrative, Legal & Public Policy Group, the Finance Group, the Global Network & Technology Group, the Human Resources Group, the Marketing Group, and the Strategy Group. Verizon has a centralized structure as it is typical in any large organization generating revenue in billions. In all the above-mentioned groups, the senior management makes the decision to run the business’ overall direction and goals. For instance, the board of directors would be the final decision-makers whether to run part of their operations in Canada or not, if so, how they will start. The members of the senior management team also serve on several cross-functional governance councils which are overseen by the CEO, and which review and approve matters that cut across functional organizations (Verizon, n.d.).

There are several disadvantages of this decision-making approach that Verizon employs, they include overworked upper management, as the daily decision making relies upon upper management, they end up having less time to focus on significant important functions. With top-heavy management, the firm will result in an imbalanced organizational structure leading to big chaos. As the top management is centralized, it restricts new ideas to keep up with customer demands and continuous change in the market, leading to limited creativity. A centralized structure also results in slower decision-making and powerless team members (Wooll, 2021).

On the flip side, a centralized structure has some advantages as well. High standardization can be achieved, this means that the firms like Verizon, who follow a centralized structure keep internal and external messaging consistent and standardize policies and procedures along with their products and services. This helps the company to create more efficient systems with fewer communication barriers. According to Thomas et al. (2022), “this structure can also reduce the potential for conflicting decisions and actions among lower-level managers who may have differing perspectives and ideas about how to tackle a situation or resolve a particular issue”. Better collaboration and communication can be achieved. As the centralized organization use the same service functions within their departments, there won’t be a need for hiring additional service functions resulting in reducing the expensiveness. Finally, the centralized organizations have quality managers as they come with training and high expertise.

References

Bianca, A. (2019, February 12). The Disadvantages to Centralized Control in a Business. Retrieved October 19, 2021, from https://smallbusiness.chron.com/disadvantages-centralized-control-business-20670.html

Thompson Jr. A. A, Peteraf, M. A., Gamble, J. E., and Strickland III, A. J. (2022). Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases, pgs. 290-321, 23rd Edition. McGraw-Hill. ISBN: 978-1-260-73517-8

Verizon. (N.d.). About | How We Operate – Management Governance. Retrieved October 19, 2021, from https://www.verizon.com/about/our-company/how-we-operate/management-governance

Wooll, M. (2021, August 20). What are Decentralized Organizations? Retrieved October 19, 2021, from https://www.betterup.com/blog/decentralization-in-management

Rajesh Work:

The company I have selected for this week is one of the well-known and well-established companies. It is Procter & Gamble (P&G) which is known for its baby products and many more. A company can either implement a centralized strategy or a decentralized strategy and this decision is left to the senior members of the top management of the company. Decision-making authority should be put in the hands of the people closest to, and most familiar with, the situation” (Thompson et al., 2022). For making effective decisions, P&G is used as a decentralized strategy. The company now owns multiple units and all these units are functioning on their own without much discourse.

The management of the company gives the same respect to everyone. Everyone in the work environment is treated equally and also the members of the management help all the different units. The board members are responsible and there is a diverse group in the work environment. The directors of the company and the other members have the co-operation and they together judge on the business decisions. The company gives a major of its interest to the shareholders. P&G never forgets to identify each of the worker's contributions. The strategic decision of the company is done by the executive group members.

Decentralized decision-making is considered one of the best strategies to implement for making decisions. The decision-making job or responsibility is given to an employee who has complete awareness regarding the situation in the workplace. Starbucks also implements a decentralized strategy for making decisions. The decision-making responsibility is shared among the large group and this strategy helps the top management and due to this strategy, the top management members are relieved from all the decision-making for all the units of the organization. Each unit of P&G does not have to rely on the top management for making simple decisions.

Advantages and the disadvantages of the decentralized strategy used in P&G. This methods allow more flexibility for taking the decisions compared to the other strategies. The changes in the decisions are easy and happen quickly when a decentralized strategy is used (Panou, 2016). The employees in each unit will have their responsibility and make them feel about their position. Here the burden on the top management members is reduced as the decision-making is left to the individual unit. One does not have to always seek top management support for making new changes. This saves time and the changes can be done in less time.

However, with these advantages, there are also a few disadvantages to this strategy. Redundancy is the position or the roles in different organizational units is one of the major disadvantages of this strategy. Achieving the required Coordination is difficult when the company chooses to implement a decentralized strategy.  Here each division will have more responsibility and requires well-trained managers and this is often expensive.

References

Panou, George. (2016). Why is decentralization of decision-making, becoming more common in contemporary organizations?. 

Thompson Jr. A. A, Peteraf, M. A., Gamble, J. E., and Strickland III, A. J. (2022). Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases. 23rd Edition. McGraw-Hill. ISBN: 978-1-260-73517-8