Introduction to Management –
In large organisations, management represents the key factor that propels businesses and industries to attain growth and development. The rise of modern organisations is not only due to the rapid advancements in technology and communications but on the ability of competent managers to struggle and confront emerging challenges to the organisation’s very existence.
There are a variety of views about management. Practically, the term management refers to planning, organizing, leading, and controlling of organisational activities and their resources (McNamara). Planning involves identifying goals, objectives, methods, resources, and responsibilities and dates for the completion of tasks. Planning and organizing human resources can be quite a challenge given the complex structure of today’s organisations. Establishing the strategic direction and vision for the organisation involves influencing people to follow that direction and share the same vision. Management is also about controlling the human resource processes, the human resource systems, and the human resource structure of the organisation in order to make it more adaptable to change in its internal and external environment.
This report will try to make an analysis of the existing organisational culture, structure, and management style of Harvester Restaurant. It is presented with adequate emphasis on how management, when confronted with a new reality, was able to identify its weaknesses in its management structure, style, and existing culture and the corresponding remedies and management initiatives through empowerment and other changes in the style and structure of their management.
Harvester Restaurant is a wholly owned brand within the Forte Restaurants Division and was recently purchased by the Bass Group (Ashness and Lashley, p. 18). By 1995, it had 78 chains of restaurants around the United Kingdom. Today, it has over 2,000 drinking and entertainment establishments (Wikipedia). Its previous management setup was thought to be obstructing the way its employees commit themselves to the quality of their service to customers.
Management Structure and Problems
Harvester was initially managed in a traditional hierarchical manner. Each restaurant unit was managed by a restaurant manager and two to three assistant managers. This management team was responsible for the day-to-day running of the unit which includes ordering stocks, maintaining the security of materials and money, cashing up and banking takings, locking premises, staffing and management of all the people within the unit (Ashness and Lashley, 1995). The restaurant unit manager reports directly to a regional manager. Four regional managers are directly accountable to the operations managers (north and south divisions) while the operations managers report to the managing director. This structure produced five layers between the customers and the managing director.
The management team then became aware of the new emerging demands and discerning attitude of customers. At this point, there seems to be a problem with the layers of management. In this structure, decisions are made at the top and passed down through several intermediaries. Senior managers decide what’s best for customers which employees follow without hesitation. But according to studies made, people resist solutions imposed by people who lack familiarity with day-to-day operations (Harvard Business Essentials, 2003). Today’s organisational structures need to have collaboration between willing and motivated parties in order to effect changes. The problem then is that in this structure, senior level managers are better at telling people what to do than at getting employees to collaborate and made significant contributions.
Under this Harvester management setup, a lot of problems emerged. There was low commitment from their employees. The rate of turnover was high. The organisation itself was too dependent on their managers for decisions. Resources and skills were under-utilized (Ashness and Lashley, 1995). Too much attention was given to processes and not on the attentive values. Employees, who are usually the ones in direct contact with customers and who usually hold direct knowledge on the day-to-day operations are usually not listened to. But there are other factors which might have been influencing these happenings. According to Duck (2001), most leaders do not have enough vertical contact with others in the organisation or enough time to stay in touch. She notes that most members of the management team of organisations are not actively using information networks that keep them up-to-date on what’s happening and who’s saying what. While most leaders recognize the value of being connected with people at every level and of getting unfiltered information, very few know how to make it happen without investing more time than they feel they have available. In short, the organisation’s strategy was not consistent with the management of its untapped human and intellectual resources. While it has set up long term goals and mechanisms to satisfy its customers, it has failed to address their immediate needs and concerns.
It is not altogether uncommon for conflict to occur inside the organisation. Conflict occurs when individuals or groups are not obtaining what they need or want. People in organisations bring with them different educational backgrounds, interests, preferences, religious and ethical values, and personalities. Usually, it causes the flow of real communication which results to the identification and resolution of problems. In a hierarchical structure however, there is a greater chance that conflict would occur. The communication process passing through different layers does not always guarantee that the right information flows correctly. Conflict resolution usually hinges around a certain layer of management. The situation at Harvester is no different. There was selective communication going on. Accountability was limited to a few.
The present management setup has instilled a culture not bent on proactively managing the focus on guests. There was a lack of trust and feeling of ownership prevailing at this time. Information was not valued either.
New Management Structure
In planning for change, it is important to identify the dimensions of change. Theory E and Theory O includes the organisational goals, leadership, and focus (Harvard Business Essentials, 2003). Theory E and Theory O Change involves embracing the paradox between economic values and organisational capability. It also encourages setting management directions from the top while encouraging participation from the people below. It also focuses simultaneously on the hard (structures and systems) and the soft (corporate culture). This theory was what had been applied to Harvester’s changes in its management structure, style and culture.
The reorganisation at Harvester Restaurants involved the removal of two layers of management within the entire organisation through a process called delayering (Ashness and Lashley, 1995). At a senior level, the two operations manager posts were removed and three regional teams were created. Each team was based on a regional office which included one training manager, one control manager, and three regional managers who would each be accountable for eight to ten restaurants. In all cases, the teams became autonomous, with a senior member of management taking special interest in each team. The team became the focus of business performance and assessment. Regional teams were allocated budgets and made decisions on how best to use these funds within the team.
In discussing the wider aspects of organisational culture, Handy (1993), suggests that diversity in the organisation puts on what he categorizes as a task culture, with influence based on the expert power. Handy (1993) describes this as a team culture where getting the job done tends to wipe out most status and style differences. At the restaurant level, the team manager and the team coach were no longer managing the staff but were more responsible for encouraging the staff to be more self sufficient and empowered. Each restaurant is organised around three teams which reflect the different operational areas like the bar, the restaurant, and the kitchen. Each team has its own team responsibilities. Johnson and Scholes (1997, p. 35) say that a major challenge for managers is to help develop an organization which is able to simultaneously meet stakeholder expectations while meeting the needs of customers better than competitors within a changing environment. Micro management of the operational areas has helped address immediate customer and restaurant concerns while increasing employees’ awareness to their responsibilities, accountabilities, and total commitment to the organisation’s new set of goals. The creation of these teams has ensured that employees are given the necessary training needed for effective performance. Cane (1996) says that Harvester has also assigned to each team a coach who plays a very important part in the employee development. The task of the coach is to give the support, advise, training, and development necessary to enable the team to fulfill its role as well as put into practice the concept of continuous development. Each coach is carefully selected and trained for his or her work and has continual close support from Harvester’s central training team.
There were short and long term tangible and intangible benefits which were derived from the initiation of changes to the management style, culture, and structure. Turnover has fallen by 19 percent. Wage and administration costs were reduced. There was also a noted low level of customer complaints. Problems were resolved more quickly without resorting to the manager. The cultural context of the organisation was moving to a trust-based culture. Within the limits set, individuals were trusted to do their jobs without constant and close supervision.
The reorganisation has led to improvements in the communications process. Team members liked to know how they were doing. They seemed to take personal interest and pride in the unit’s performance (Ashness and Lashley, 1995). They began to value their contribution to the team.
In terms of conflict resolutions, problems can easily be locally settled and decided immediately just as they arise. This has helped Harvester channel much needed resources for team building activities and other skills enhancements programs.