The main motive of this report is to develop an analysis of different aspects of an organization along with describing various functions. In the first part, organization structure, behaviour, and culture relating to multinational and home country companies are explained. Section two comprisesof effective drivers of changes are described.
Section 1: Organisation Structure, Culture, and Behaviour
1. Compare and contrast two different organizations to critically examine the culture and structure of each organization.
Hofstede’s model of culture
Hofstede’s model of culture is a type of model which is significantly used for understanding the cultural differences among organizations. This model is introduced by Dr. Greet Hofstede’s. This model comprises various dimensions to differentiate between the two different organization’s cultures. Individualism versus collectivism (IDV), masculinity versus femininity (MAS), indulgence versus restraint (IND), uncertainty avoidance index (UAI), long term orientation versus short term orientation (LTO), and power distance index (PDI) is the various dimensions (Antunes, et. al.,2016).
Power distance index (PDI): the dissimilarity in society is denoted by this. Higher PDI lowers power in people and their agreement for unequal power distribution. The lower value of PDI indicates equal power distribution among society. The organizations with higher PDI scores, important documents can be only sent to higher authorities.
Individualism versus collectivism (IDV): in society, it indicates the strengths of the interpersonal connections. High score of IDV shows lose tie midst people and a lower score indicates strong bonding in society.
Masculinity versus femininity (MAS): the value of the role of females and males in society is decided by the MAS score. A lower score indicates the equality of men and women in organizations and a higher score indicates the higher priority for men in organizations.
Uncertainty avoidance index (UAI): levels of anxiety shown by people in unexpected situations are indicated through UAI. Higher score of UAI indicates work done for moving further from unexpected occurrences while lower score shows diversity and enjoyment in uncertain conditions in organizations.
Long term orientation versus short term orientation (LTO): the importance of long terms against short terms in the organisation is indicated by LTO. The higher score value of LTO will indicate the priority given for the culture and traditions by organizations whereas the lower score of LTO shows less prioritizing traditions in organizations that support the generation of creative and innovative ideas.
Indulgence versus restraint (IND): lower score of IND shows a lower rate of gratification whereas a higher score of IND shows the enjoyment factors of people in organizations.
Royal Dutch shell is a famous multinational oil and gas company based in the Netherlands. The organizational structure of the royal Dutch shell is integrated structured which is having a total number of 83,000 employees. There are about 52 subsidiaries of royal Dutch shell which are operating in about 70 countries. RDS uses a matrix organizational structure that is based upon different executive branches of the company and is supported by various business divisions (Brown, 2015). The Royal Dutch shell oil and gas company follows a disciplined work culture in the organization. This culture is based on vertical hierarchy and tall structure in which the higher authority is the management of the company and it is responsible for the decision making for the beneficiary of the company and handling the employees’ working behaviour.
Indian Oil Corporation Limited is a well-known company of oil and gas and it is headquartered in New Delhi. It is a government-owned company by the Indian government. It is the biggest oil commercial company in India. This company follows the organizational structure of the hierarchy mode in which there are various subdivisions for the managerial organization of the company to handle various tasks related to the decision making, recruiting selection process, purchase, sales, and many others. This organization structure calls up to its head of departments for taking care of every task. The organizational culture of the company offers different dimensions for their employees which makes it impossible for employees to leave the workplace. These dimensions are credibility, respect, pride, camaraderie, and fairness. These dimensions create a great work culture that helps in the better performance of the company and gaining growth and development.
Compare and contrast two organizational structures
Royal Dutch shell is a multinational corporation of oil and gas whereas Indian Oil Corporation Limited is an Indian government-operated national company. Their organizational structures are very different from each other in which the Indian oil corporation works on the hierarchical structure in an organization that consists of multiple layers.
The hierarchical structure of Indian oil corporations is composed of multiple layers, unlike the royal Dutch shell which works upon matrix organizational structure. The major benefits for Indian oil are from the divisional structure which helps the company to operate a business in a different range of demographic areas (Chatman, et. al., 2015). On the other side, the royal Dutch follows a matrix structure in which the higher authorities connect with the lower management of the company to expand knowledge of managers’ domain for requirements of consumers and their frequently changing needs.
Indian can work effortlessly for managing various work locations all over the country as the organization is following a multi-layered divisional structure for monitoring and maintaining. The divisional structure helped Indian oil for their financial conditions and enhanced situations whereas, on the other side, the royal Dutch shell is minimizing the levels of management required for establishing communication with the lower working groups of the company as a side effect of various functional departments of the organisation. The higher authorities are gaining diversification of suggestions for the improvement and monitoring the lowest level of management without other departments’ intervention to enhance growth and development (Alsudais, et. al., 2018). The problem-solving attitude and decision-making procedures of both organizations have improved through diverse organizational structures to a great extent in the business world.
Under some circumstances of risky conditions, the matrix structure works way better than the hierarchical structure. Indian oil’s hierarchical structure allows the company to handle various business works at various divisions. But it makes it difficult for the enhancement in employee’s contributions performance. Similarly, the matrix structure shows some issues while managing the various employees and management structures of the company and not focusing on the higher functionalities which affect employee performance. There are some and other difficulties faced in both the organizational structure but they also have various benefits that help the organization to work with smoothness and help in the advancements of growth and development of the business activities on the global range. They both have their benefits and disasters which need to be concerned by the company which follows its structure.
2. What impact do you perceive that organizational structure and culture have upon how leaders, managers, and employees behave in these companies?
Royal Dutch Shell leaders and managers provide accurate directions to the employees to reach individual and organizational goals. In this, employees working in the divisional structure are considered as an autonomy structure in which all the members can easily share their ideas to the higher authority of an organization(Uhl-Bien, et. al., 2017). The company managers facilitate team group members to evaluate and understand individual goals and objectives so that the implementation work can be carried out effectively. In an organization, leaders are following the autocratic style of leadership to manage and control their team members and their performance. Managers are work to resolve major issues in each department as they often encounter the workload. The matrix structure of the Royal Dutch shell provides appropriate autonomy to the employees of various divisions which help in achieving their distributed project(Wooten, et. al., 2017). It assists in increasing the workability and skills of an employee in the company.
Indian Oil Corporation follows a hierarchy organizational structure in which the BOD is divided into functional directors and independent directors. In this company, the operations are well structure managed along with accurate names such as refineries, marketing, pipelines, research and development, and the Assam oil department(Sarmad, et. al., 2016). Such a structure controls the staff members’behaviour by using written regulations and employees have some freedom to make their decisions. In this, formalization develops and makes employees’behaviour more predictable in which they can perform their role in the best manner and reach desired goals. Therefore, employees give responses in their structure towards the specific issue that can lead to consistency of behaviour(Meidell, et. al., 2017). The second one is managers; they can easily make their decisions and transfer any important information to the different departments in a limited time. This structure helps managers and provides a great chance for managers to monitor and supervise the employees’ activities in a better manner. The hierarchy structure involves effective performance managed by leaders in which they are focus on each team member’s actions and functions properly.
Section 2: Drivers of organizational Change
1. Create a PESTEL table that explains the specific drivers of change for this particular organization. Select two or three of the key change drivers to examine in more detail.
It has been analyzed that organizational change is driven by the help of PESTLE analysis. In this, Royal Dutch shell is selected for the report which is an MNC of oil and gas and its headquarter is located in the Netherlands and incorporated in England. It is the third-largest company in the world and it measures by the income of 2018(Klassen, et. al.,2018).
PESTLE analysis of Royal Dutch shell:
· The unstable political condition could be the main factor that influencing the company’s needs to carry out changes in the current procedures.
· Alterations in the UK political scenario could develop various issues and problems.
· The economic uncertainties often develop and create complexities for the company to manage income outcomes.
· Different economic factors, which include inflation rates, unemployment rate, GDP growth rate, act as main driving factors behind the company change.
· An organization can bring certain changes in its current practices associated with product formulation and develop due to the consumers changing requirements and needs.
· The negative social point of view regarding all the oil and gas industry
· Use of block chain technology at different point of oil and gas supply chain
· Artificial intelligence helps in battery tools and method
· Trade compliance rules and regulations
· Data protection laws in all over the world
· Antitrust and competition laws
· Problems related to increasing concerns regarding climate change
· Enhancing concentration on sustainability in all across the world.
· Geological issues and risks caused by the business operations
There are two key changing drivers which are described as under:
Technological change –This is the key changing driver that needs to be focused by the Royal Dutch Shell. It is essential for a company is to adopt the latest and advanced technology which helps in update the methods and tools through which they can easily mining gas and oil in a better way(De Vries, et. al., 2016).
Political change – It is the key changing drivers that can impact on the gas industry. Every country has followed different rules and regulations which need to be followed by the company in a better manner. This is important for Royal Dutch shell is to analyze whole political condition according to this they need to make changes in their business functions and operations.
It can be concluded that every organizational leader and manager plays an important role in maintaining the diverse activities that include driving factors of change management. The report helps in analyzing the two organizational cultures where the different background of employees works together to gain set goals.
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