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Advantages:
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It empowers and motivates workers.
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It reduces the stress and burdens of senior management. It also frees time for managers to concentrate on more important tasks.
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It provides subordinates with greater job satisfaction by giving them more say in decision-making, which affects their work.
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Subordinates may have a better knowledge of ‘local’ conditions affecting their area of work. This should allow them to make more informed, well-judged choices.
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Delegation should allow greater flexibility and a quicker response to changes. If problems do not have to be referred to senior managers, decision-making will be quicker. Since decisions are quicker, they are easier to change in the light of unforeseen circumstances which may arise.
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By allowing delegated authority, management at middle and junior levels are groomed to take-over higher positions. They are given the experience of decision making when carrying out delegated tasks. Delegation is therefore important for management development.
Delayered structure
Delayering involves a business reducing its staff. The cuts are directed at particular levels of a business, such as managerial posts. Delayering involves removing some of these layers. This gives a flatter structure.
Delayering is likely to play a major role in a policy of decentralisation as the removal of management layers allows authority for decision making to be shifted to a lower level in the organisation.
Advantages:
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The savings made from laying off expensive managers. It may also lead to better communication and a better motivated staff if they are empowered and allowed to make their own decisions.
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However, remaining managers may become demoralised after delayering. Also staff may become overburdened as they have to do more work. Fewer layers may also mean less chance of promotion.
Management style
Management style refers to the approach that an organisation takes in setting objectives for its employees and the way it manages relations between superiors and subordinates.
Management or leadership styles can be categorised as:
Autocratic: A manager that adopts an autocratic management style takes entire responsibility for decisions and, having set objectives and allocated tasks to employees, expects them to be carried out exactly as specified. Employees are told exactly what, how and when work must be started and finished. It is the kind of management style often associated with a corporate culture centred almost exclusively around production. Power is focused at the top, and the centralised decision making is geared to getting the goods out of the factory and to customers. Little regard is paid to any non-monetary needs of employees; they are not consulted or involved in decision making.
Democratic: A democratic management style seeks to involve employees in the decision-making process, either by consulting them directly or through their representatives. This approach reflects a corporate culture which is more human resource centred and recognises the organisational benefits from meeting its employees’ non-monetary needs - such as a need for job satisfaction and a sense of belonging. A consultative approach is particularly important if an organisation is planning to change product design or working conditions, methods and practices.
Laissez-faire style: This style gives people complete freedom to organise and carry out their work. It is a very person centred approach. A laissez-faire approach may still impose some constraints, such as completion dates for certain key tasks or the earliest and latest arrival times for a flexible hours working day. There is no formal structure for decision making as decisions are taken by a variety of processes depending upon the nature of the problem, the opportunity to be explored and the individuals involved.
Consultative style: Leaders consult with others before decision are made. There will be a group influence in the final decision, even though it is made by the leader.
Head of
Operations
Ireland
Distribution Director
Commercial Director
Retail Director
Finance
Director
Marketing
Director
Chairman
(non executive)
Chief
Executive
Deputy
Chairman
Company
Secretary
Section
managers
Section
managers
Section
managers
Section
managers
Section
managers
Section
managers
Section
managers
Supervisors
Supervisors
Supervisors
Supervisors
Supervisors
Supervisors
Supervisors
Operatives
Operatives
Operatives
Operatives
Operatives
Operatives
Operatives
As diagram above shows, Tesco has many levels of staff: directors on the top, and step by step to employees on the bottom, therefore I can think that Tesco is a hieratical organisation, where each individual knows who he must report to. Communication in a complex organisation such as Tesco will be dependent on the organisational structure, but this will be discussed later in my section on “Communication”.
I can see that Tesco has a centralised and decentralised form of organisation because people on the top, who control the company, take the majority of decisions and also the company’s Head office is centralised at Cheshunt in Hertfordshire.
Tesco is very big organisation and has very many stores in different places – this fact shows that Tesco is a decentralised organisation, with much decision-making delegated on a regional and individual store level.
From the information I have managed to access I believe/consider that Tesco has a very good democratic and consultative management style. It is a very successful firm, as seen earlier, it is now the U.K. market leader with positive leadership from above and a notable corporate culture.
The directors present their annual report to shareholders on the affairs of the Group together with the audited consolidated financial statements of the Group for the 52 weeks.
The principal activity of the Group is the operation of food stores and associated activities in the UK, Republic of Ireland, France, Czech Republic, Slovakia, Hungary, Poland and Thailand. A review of the business is contained in the Annual Review which is published separately and, together with this document, comprises the full Tesco PLC Annual report Accounts.
Culture
Culture in organisations is often described as the set of values, beliefs and attitudes of both employees and management that helps to influence decision-making and ultimately behaviour within them. Each organisation has a unique culture. This is what makes studying business behaviour so fascinating. The business culture helps to determine how things get done in firms and defines, quite simply, how the company works. The fact that organisations are themselves organic, composed of workers constantly interacting with each other and their environment, suggests that the culture in firms is not static and constant – the way firms operate can change, either intentionally through management action or more likely through natural evolution.
Corporate culture
Corporate culture is a set of values and beliefs that are shared by people and groups in an organisation. A simple way of explaining corporate culture might be to say that it is the ‘way that things are done in a business’. The corporate culture of a business can influence decision-making. It also encourages low level managers to behave like entrepreneurs. Business leaders are able to create a corporate culture to achieve a corporate objectives and strategy of the company. It is important that the corporate culture of a business is understood by all the people that work in the organisation. It is usually transmitted to new members and reinforced informally, by stores, symbols and socialisation, and more formally through training.
Advantages of a strong corporate culture.
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It provides a sense of identity for employees. They feel part of the business. This may allow workers to be flexible when the company needs to change or is having difficulties.
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Workers identify with other employees. This may help with aspects of the business such as team work.
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It increases the commitment of employees to the company. This may prevent problems such as high labour turnover or industrial relations problems .
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It motivates workers in their jobs. This may lead to increased productivity.
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It allows employees to understand what is going on around them. This can prevent misunderstanding in operations or instructions passed to them.
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It helps to reinforce the values of the organisation and senior management.
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It acts as a control device for management. This can help when setting company strategy.
BUSINESS
CULTURE
Power culture.
Risk averse culture
Competitive culture
Positive culture
Negative culture
Person culture
Technological culture
Bureaucratic
culture
Customer driven culture
Task culture
Dynamic/innovative culture
Figure 1.8: Types of business culture.
Culture, presented within Tesco plc.
Tesco has achieved its position as Britain’s leading food retailer by offering excellent value and service to its customers. Underlying its business success is a commitment to upholding certain values, working principles and culture within the organisation, and to seek continuous improvement in its ethical performance. As a measure of its achievement to date, in 1997 the company came top in the Christian Aid league table for ethical commitment.
Customers.
Tesco must serve its customers by providing the goods they want and the service they expect. By meeting customer needs better than its competitors do, Tesco earns profits and creates value for its shareholders.
Customer service is at the heart of Tesco business culture. The base line is quality and value, but customers also look for a shopping environment which is attractive, well planned, and enjoyable. They also expect staff to be helpful, responsive to their needs, and sympathetic to their problems. Tesco is constantly seeking new ways of meeting customer needs. These include introducing Customer Assistants dedicated to helping customers at every point during their shopping, establishing a Customer Service Centre to deal with customer enquiries, providing facilities for customers with disabilities, and organising customer question times when Tesco can hear customers views.
Staff.
Tesco employs 154,000 people in the UK and 27,000 in Ireland and Europe. It is constantly told by customers that its staff are the company’s best asset. This means that the company must motivate and train its employees to give the best possible customer service, and provide opportunities for all members of staff to develop their talents to the full.
The company believes that the welfare and safety of its employees is of paramount importance, and applies high ethical standards to protect workers’ rights and reward employees fairly for their work. Full and part-time staff have had their benefits harmonised, including salaries, purchase discounts, pensions and profit-sharing. The company has a national agreement with USDAW, the shop workers’ trade union.
The approach of Tesco to worker welfare goes beyond its own employees. The company insists that its suppliers meet certain employment standards in matters such as fair pay or minimum working ages. Tesco believes it can play a positive role in influencing working practices around the world.
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