What were the challenges that Shikhar Ghosh faced when he joined Appex?
At the time, when Shikhar Ghosh joined Appex, this company faced several challenges; in particular, one can speak about the inability to plan long-term projects and prioritize the activities of the personnel. Moreover, this organization lacked accountability standards, and it was difficult to allocate responsibilities among employees. Overall, the structure of this organization was largely shaped during its start-up stage. It was mostly a project-based organization which means that the employees were grouped and regrouped according to the needs and timelines of a specific task. Such organizational design had several advantages.
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For instance, the company was able to respond quickly to a new and urgent challenge. However, at the same time, the company was too chaotic, and the work of employees was poorly-coordinated. Additionally, the company began to have difficulties with their customers because these people felt that their needs were not timely met. These were the challenges Shikhar Ghosh and his team had to overcome.
Evaluate the importance and the impact of each of the structural changes that Ghosh implemented
Considering the first change, what was the intended purpose of this change?
The first change implemented by Shikhar Ghosh was the introduction of a circular organizational structure. The main purpose of this initiative was to develop a non-hierarchical organization in which employees and senior management could exchange information with one another. In part, this initiative can be supported by theoretical concepts, for instance, one can mention the idea of a learning organization that has a memory of its past successes and failures.
Moreover, such an organization can be compared to a living organism and a brain can respond to changes as quickly as possible. It is not stated clearly in the case whether this initiative improved the exchange of information. Yet, such a form of structural design made it difficult for the new hires to integrate themselves into a company. Moreover, many other employees could not understand how such an organization was supposed to work.
Considering the second change, what was the intended purpose of this change?
The second change was aimed at reorganizing the company according to a functional principle. The employees were asked to work in teams specializing in a specific area such as engineering, marketing, or finance. In part, Shikhar Ghosh strived to ensure that managers and employees were accountable for their achievements and failures. His intentions were premised on the belief that an organization could be compared to a machine in which every component performs a set of specific functions. However, one has to consider that these components cannot operate independently and the failure of one component can prevent other components from functioning.
This initiative did improve accountability in the company; yet, it also gave rise to several problems. In particular, the role of separate individuals increased, and this role of personality made Appex more vulnerable. Apart from that, different teams could not properly cooperate. The problem was that the managers of different teams did not know where their responsibilities ended.
Considering the third, fourth, and fifth chances, what was the intended purpose of these changes?
The purpose of the third, fourth, and fifth strategies was to remedy the mistakes that were identified by senior management at the previous stages. Shikhar Ghosh and his team attempted to improve the accountability, cooperation, and flexibility of the company. Overall, at that stage, Shikhar Ghosh relied on a more complex vision of an organization. In this case, one can mention all three metaphors used by managerial scholars, namely a living organism, the human brain, and a mechanism. These metaphors enable managers to understand the roles of different organizational parts and their interactions with one another. Shikhar’s strategies did improve budgeting and planning in Appex, but at the same time, different divisions began to act like separate companies that had their procedures. Moreover, they were not willing to share resources. Thus, it was rather difficult to join their efforts.
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Were all the changes in structure necessary?
The philosophy of Shikhar Ghosh was based on the idea that a structural change was a way of resolving the problems that a company could face. However, it is possible to say that not every change that he implemented was necessary. For instance, in the beginning, he experimented with circular and horizontal structures in which hierarchical power relations were practically absent. However, this initiative did not take into account past experiences of employees, their work values, and skills. Moreover, due to these changes, the responsibilities of workers were not delineated. As a result, these people felt confused because they were only asked to achieve new financial targets, but sometimes they did not know how to achieve them. Thus, one can say that the initial changes could have been skipped.
What would you have done in Shikhar’s place?
If I were put at Shikhar Ghosh’s position, I would first try to set accountability standards within Appex. In particular, the employees and senior managers had to understand what kind of quantitative and qualitative objectives they had to meet. As it has been outlined in the case, this objective was achieved by establishing a divisional structure in Appex. Additionally, I would attempt to ensure that these divisions worked closely with one another.
This is why I would argue I would insist that several executive officers of an organization should coordinate the work of different divisions and link their operations with the strategies of a company. These divisions had to share resources and information.
Shikhar Ghosh’s vision of an organization is very complex. He regarded this company as an organism and a mechanism. On the one hand, he emphasized the ability of different teams and divisions to share information and resources. Yet, he also stressed their ability to perform a set of specific functions. This property is a characteristic of a mechanism.
Do you think that structural changes are a useful management intervention?
Structural changes should not be used as a regular method of managerial intervention. They are necessary when a company needs to change its policies and strategies radically. Such an intervention is appropriate when an organization has to adjust itself to external factors. The thing is that effective cooperation of employees is possible when they interact with one another regularly. Frequent structural changes disrupt these ties between employees. After an organizational change, a person needs time to get used to this change and he/she may not perform the duties effectively. Thus, it is undesirable to implement structural changes as a company faces minor problems within its departments or divisions.
Name two lessons from analyzing this case about the importance of organizational structure to an organization’s effectiveness
The case of Appex illustrates many important lessons about the importance of organizational structure for its effectiveness. First, this formation has to ensure that a company can respond to various challenges, risks, and new goals. A company can do it only if its structure allows quick exchange of information across the borders of departments and if its employees can understand their duties and responsibilities clearly. The second important lesson is that structure is vital for long-term planning and prioritization of tasks. A well-developed structure enables a company to see itself in the future. Without such a vision, an organization cannot make progress and evolve. This is one of the reasons why the management of Appex decided to implement structural changes.