Table of Contents
2. The Organisation theory and its application to APB
3. The rationale behind the present organization structure
4. How its organization structure facilitates goal attainment
5. The Merits of the approaches to organizational effectiveness
6. Sufficient structural Problem in the Asia Pacific Breweries Limited
In order to better explore the overall conception of organization theory, the author of this essay uses the Asia Pacific Breweries Ltd (APB), a company that has seen continued growth since its formation despite varying environmental influences across the years. This company stands out as one of the leading beer manufacturers in the industry. APB is jointly formed by Heineken and other groups of companies; that is, the Fraser and Neave companies (APB, 2011). Furthermore, APB had begun as Malayan Breweries Ltd during the year 1931. Since then the company has transformed itself from its sole Tiger manufacturing business to the current involvement in the manufacturing of other beer brands. Consequently, due to increased globalization and other changes, the company changed its brand name in 1990, from the Malayan Breweries Limited to Asia Pacific Breweries Limited (APB, 2011). As a result of this change in brand name the APB has seen continued success through its global network located across 60 countries in which it enjoys support from 37 breweries located in Cambodia, Singapore, China, Indonesia, Malaysia, LAOS, Mongolia, New Zealand, New Caledonia, Papua New Guinea, Thailand, Sri Lanka, and Vietnam (APB, 2011).
The APB Ltd in its management structure is governed by various personnel who act in their varying capacities in order to promote the attainment of organizational goals and objectives. At the topmost is the Chief Executive Officer Mr Roland Pirmez who is being assisted by different directors charged with their specific roles in the company. Some of the strategic managers include the Human Resource director, the Legal Director, Commercial Director, Corporate Communications director, among others. They all act in a synergism in order to promote organizational vision, mission, and objectives.
From the aforementioned introductory information regarding the Asia Pacific Breweries Limited, a number of vital concepts must be born in mind in order to better understand the organizational dynamics that spearhead the attainment of objectives. And this is in line with the Mintzberg Model regarding organizational structures. In Henri Mintzberg's theory, as seen in the Structuring of Organizations and Structure, there exist five major parts upon which organizations are formed. These include the Strategic apex, the technostructure, the support staff, the middle line, and the operating core. All these parts perform their duties in lieu of attaining the organizational goals.
For instance, it is the duty of the operating core to ensure that basic work directly related to production and services is performed. On the other hand, the strategic managers are endowed with the responsibility of ensuring that the organization sticks to the mission and the demands of its shareholders. This form of structure is witnessed in the APB Limited in which case we would cite the Chief Executive Officer as one of the strategic managers of the group. Other strategic managers include the Group Finance Director, the Business Development Director, the Human Resource director, the Supply Chain Regional Asia Pacific senior director, and the various Regional directors. This individual personnel ensure that the organization sticks to its objectives through the formulation and implementation of policies that are responsive to the organizational dynamics.
Middle-line managers on the other hand act as links between the operating core and the strategic managers. In this case, the kind of authority that they exhibit is the delegated one which is also formal in nature. This is because they are not the ones who formulate policies; they are rather involved in the execution of policies that are formulated by the strategic managers. In this regard, middle-line managers include the various managers that work for APB limited. They include the Corporate Communications Manager and the various managers responsible for the different groups across the world such as the General Manager, PT Multi Bintang Indonesia Tbk, the General Manager Tiger Export Pte Ltd Singapore, to name but a few. Their duties involve ensuring that the various policies formulated by the strategic managers
Organization theory also points out the existence of the technostructure which comprises of analysts involved in the process of designing, planning, or training others in order for them to take part in the daily operations of the organization. These kinds of managers are never engaged in the actual organizational operations. This explains the reason as to why APB Limited consistently makes use of Heineken technical experts in the beer production process due to their excellent experience over the years. These experts are further called upon to carry out numerous tests in order to ensure that the production process remains flawless.
The existence of the support staff is one of the most significant and necessary components within the organization structure. This is because without them there will never be support outside the organization’s workflow. This group of people comprise of specialized units (Sherwin, 2009). APB Limited obtains support from across the globe especially through the managerial staff situated in the various regions to which the organization is affiliated.
The organization structure of APB Limited would rather be referred to as professional bureaucracy as opposed to machine bureaucracy. This is because the skills exhibited by the various professionals are basically standardized through indoctrination and training. In this case, professionals are meant to begin from the operating core before they are given considerable control in their line of duty. This form of structure
Every organization is structured in a manner that it exhibits an ends focus. This conception arises from the fact that ends are the ones that give meaning to the existence of the organization. Without them, organizations would never exist. As we go through the current organization structure it is important that we also embrace the rationale behind its choice especially as regards the attainment of the organizational objective. Of course, the major objective that the organization strongly upholds is the maximization of profits and minimization of costs. This is done through the use of specialization especially in the acquisition of the required personnel. Furthermore, the organization in order to facilitate accelerated profitability has diversified itself and established regional groups in order to take advantage of the economies of scale that results from large-scale production as well as sales. Furthermore, in order to maximize returns organizations must also minimize exposure to risk. This is achieved through a coordinated system through which various regional managers ensure that they carry out market analysis in their respective markets in order to understand the changes in consumer behaviour and preferences. Similarly, the regional managers are also endowed with the capacity to observe the competitor trends in order to ensure that the APB Limited remains strong in the market.
The Merits of the approaches to organizational effectiveness
Organizational effectiveness would be understood under the following pillars; that is, the internal dimension, the external dimension, the structural flexibility, and finally the control dimension. It is these four pillars that give rise to the four approaches to organizational effectiveness. To start with, the first approach is
The second model relates to the Open Systems which makes use of both the external focus as well as the flexible structure aspects. Under this approach, the organization is better blessed to basically incline towards the acquisition of resources as well as growth. Consequently, through this approach strategic managers are able to offer flexibility, external environment’s positive evaluation opportunities, as well as readiness to obtain external resources. In so doing the organization is able to maintain a good relationship with the outside environment from which it is expected to acquire resources. This approach has been termed as being synonymous with the Systems Resource approach.
Another approach towards organizational effectiveness is the Internal Process approach. This model lays more emphasis on structural control and internal focus. With regard to this approach organization that adopt it must ensure that it maintains order in its organizational setting. Additionally, in order to facilitate this model within an organization setting, managers must set out policies aimed at enhancing communication, decision making, and information management within its operations.
The Final approach to organizational effectiveness is the Rational Goal approach. This goal basically emphasizes the need for maximized efficiency, productivity, as well as profitability. Moreover, under this approach organizations are encouraged to set out towards the attainment of optimal output in a rational way. This approach, therefore, requires that organizations should focus extensively on goal-setting and internal planning; these are the major rational management means. Consequently, as a result of its constituent, the rational goal approach is rather strategic because it emphasizes the strategic mode of decision-making featuring short-term policies that relate to the changes in the organization’s environment.
However, the implementation of the four approaches within an organization is bound to yield opposing value-sets. In case they exist simultaneously, then the management team is charged with a very tough duty to create a balance in as far as the implementation of the four approaches is concerned. However, even if the approaches are implemented in organizations there is bound to be one approach to which organizations lay more emphasis on. For instance, in the case of APB Limited, there is a stronger inclination towards the rational goal approach which goes in line with the horizontal differentiation as outlined by Stephen Robbins and Neil Barnwell. According to the aforementioned authors, this form of differentiation refers to "the degree of differentiation among units based on the orientation of members, the nature of the tasks they perform and their education and training (Barnwell and Robbins, 2006, p.105).” This approach comes as a result of the availability of diverse skills among different personnel in the company. And this personnel due to their skills and specializations in various disciplines are provided with what they can do best in the organization.
APB Limited Company operates in different regions across the globe. Whereas this has seen steady growth over the years it is bound to lead the company to a structural problem due to increase number of players and investors both bearing different investment objectives. Moreover, due to the increased scope in as far as strategic management is concerned, it creates a big challenge when making decisions. A problem like this arises because of the existence of many individuals endowed with the capacity to influence the organizational trend especially in line with technological advancement, globalization, as well as in line with the changes in consumer tests and preferences. It is therefore important that APB Limited cautions against this problem in order to ensure that it does not suffer setbacks in the near feature. Similarly, the company should also ensure that the span of control (Barnwell and Robbins, 2006, p.107) is manageable so that communication between the various managers and subordinates remains efficient.
The theory of organizations is so pervasive that covering holistically requires a lot of research and focus. This essay has embraced this theory in a very comprehensive manner right from the start to the end. Consequently, in order to better analyze this theory, the author of this essay has explained the organization structure of Asia Pacific Breweries Limited, a company that stands out as one of the companies in the world that have seen tremendous growth. In the due course of the research, it has been made clear that Asia Pacific Breweries Limited operates in 60 countries with 37 breweries located in a number of countries. This growth has seen increased economies of scale and risk diversification but it has also made possible the growth of a very sophisticated organization structure that bears more of a professional bureaucracy. In the due course of this analysis, the author has clearly shown that organizations exist for a purpose, and in this case, the APB limited exists to generate revenue
Barnwell, N & Robbins, S.P. 2006 Organisation Theory: Concepts and Cases, Pearson Prentice Hall, Frenchs Forest, Australia
APB, (2011), Asia Pacific Breweries Limited: Corporate Profile [online]. Asia Pacific Breweries Limited. Available from: http://www.apb.com.sg/corporate-profile.html [Accessed on 22nd March 2011].
Sherwin, L. 2009, Mintzberg Model: Managing Change Toolkit [online]. Lindsay Sherwin. Available from: http://www.lindsay-sherwin.co.uk/guide_managing_change/html_change_strategy/07_mintzberg.htm [Accessed 22nd March 2011].