Armani Organizational Structure PDF

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Dea Harizaj MHR 300 Section 4 02/26/2016 Giorgio Armani Organizational Structure Becoming a prestigious, cutting edge, proven leader in the fashion industry is not something that occurs overnight. But having the right ideas people and structure all in sync with one another certainly helps get you there. This paper will cover how the international organization Giorgio Armani is structured, which elements bring the organization the most success and where can they improve. An organization’s structure and culture are very closely related, and understanding one gives you insight on the other. Taking into consideration the Armani name, I personally thought working for such a company would be extremely stressful, however, I was pleasantly surprised for people to say otherwise. Even though there were those that didn’t enjoy the fast paced environment and felt pressured to meet sales goals. Overall Armani gets a 4.2 out of 5 rating from employee reviews. Most reviews appeared to say something along these lines, (as did this visual merchandiser from New York) “Working within the Giorgio Armani SPA gives you a level of perfection and satisfaction that every area of the company works in harmony and beauty to create a vision of Mr. Armani.” Being such a large profit organization, I think it’s very important that even lower level employees are in line with Armani’s ideals. In another source, the Fashion Spot discusses what Mr. Armani himself had to say about his culture, he stated: “You can be creative in different ways, you can be creative without worrying about business or industrial

issues, like an artist, who doesn’t care about selling. Then there’s a kind of creative who works alongside the industry. That is the American model of business and I embraced it myself as a philosophy and a way of working”. This statement has led me to change my opinion regarding the Armani culture and caused me to believe they have incorporated an adhocracy/market culture. Now that we have covered a little about the culture I will go more in depth with the Armani structure. Giorgio Armani SpA uses a very centralized kind of authority, where various significant decisions are made by Mr. Armani himself. He is the firm’s sole shareholder as well as managing director. Also, many of the top directors working for him are his own family such as his sisters Rosanna Armani, and Silvana Armani as well as his niece Andrea Camerana. Overall I would say that the firm holds a horizontal design a mix of functional vertical and project team horizontal arrangements. The firm is divided not only among a very large diversification of products but as well geography and different client divisions. A more simplified structure for the key people in the organization goes like this: Board of Directors horizontally from Chairman and managing Director (Giorgio Armani) and again horizontallyDeputy chairman and Director (John Hooks) and from there it divides to different directors although it does not state if these directors are leaders of the different products services or geographic divisions. Among them are (again) the names of Rosanna Armani, Silvana Armani, Andrea Camerana, Pantaleo Dell’Orco and lastly Livio Proli. The organizational structure is divided among many different clothing brands. There is the elite Giorgio Armani for ages 35-50, there is Armani Privé for seekers of haute couture, Armani Collezioni for lovers of the more luxurious brands but unable to afford it, Emporio Armani young professionals ages 25-35, Armani juniors for kids, Armani exchange for

the mass public and Armani Jeans for young adults 18-30. The Armani product diversification does not just stop there as it has emerged into creating many other products as well other than the known clothing brand. There are Armani fragrances, Armani Fiori (flowers), Armani Dolci (sweets), Armani eyewear, Armani casa (home), and lastly Armani Hotels & Resorts. The many products make Armani look very stretched out in many different sectors but they have a plan for bringing everything together. (Evgeny Dimitrov, 2012). For their products, Armani used vertical integration a countervailing manufactory strategy. (Evgeny Dimitrov, 2012). Armani divides his products to different groupings of the company. Antinea Srl deals with formal clothing for Emporio Armani and Armani Collezioni, Deanna S.p.A. deals with knitwear, Guardi S.p.A. with footwear, Intai S.p.A. with ties, underwear, beach, home furnishings, leather, and accessories, lastly, Simint S.p.A. deals with casual wear for Armani Jeans. The way they distribute these products is both directly through managed stores in key markets and for key brands, or indirectly in managed stores with competent trading partners. In total, looking at it from a geographic division Armani is located in 5 continents (Europe, North America, South America, Asia, Australia) has 500 stores worldwide in 46 countries. Given all these details about the company I do not believe Armani to be an organic organization (at least not for the most part). Even though I stated that Armani tends to go for an adhocracy culture I think that the creativity aspect stands just perhaps for the top directors of the organization and the different fashion designers as well as Giorgio Armani himself who in fact has designed many of his own products. When it comes to the business aspect, however, it appears that Giorgio Armani S.p.A embodies a mechanistic organization approach. According to our lecture, it explained that a mechanistic organization is centralized, tasks and rules are clearly

specified, and employees are closely supervised. Going back to my explanation of the company’s structure we clearly see a centralization as Giorgio Armani likes to take on much of the responsibilities himself and the people who he shares some of it tend to be family. Furthermore Armani is aiming for perfection it’s, in fact, one of his company’s missions, he expects quality, therefore, it’s safe to say he has strict rules on what is acceptable to taking on the Armani name and what isn’t. Here I have explained how the firm is divided geographically and by the different diversification of products as well as into different functions of directors, next I will explain where I believe to be the biggest strengths of the structure of Armani. One of the biggest strengths I see in the way that Armani is structured is by differentiation. There is differentiation everywhere be that in clothing or in different products. I believe that to be a strength because different units can specialize in different areas. In case one of the units isn’t doing very well for one reason or another, also if unfortunately, one of the units fails, there is many other ones to fall back on without hurting the overall company very much. The differentiation exposes Armani to different target markets. Although it’s considered a prestigious luxury brand it also offers Armani exchange for the masses and Armani Collezioni. This increases the brand sales and makes the Armani better know to the world and different kinds of clienteles. Another strength that I see in the Armani structure is the fact that Armani holds in his board of directors very trusted people to him. I believe this enforces his opportunities for aligning his strategy, culture and structure as many of them are his family. What this means to me is that they grew up in similar circumstances and, therefore, see eye to eye having related visions and really pushing for the same goals as the managing director. As I mentioned before having that energy and pushing for that culture has worked as even employees working in much lower positions are proud to work for Armani and push for that similar idea. If everyone’s goals

are aligned and they’re passionate about their roles in the company it just makes for business to run smoothly and come closer and closer to that mission and vision. Although there were aspects of the organization of Armani that I liked and thought were beneficial there is something that the company has always been critiqued about. What I believe to be a strength I also see as a weakness. Mr. Armani likes to hold all the power and have a very controlled environment people he knows and trusts, however if he shared some of his power it would be more beneficial to the company in the long run, as he is at an older age. However, amongst other things I don’t think that’s necessarily the biggest flaw in the organizational structure parse. It’s understandable that Armani is an extremely successful multinational fashion house, that being said logically it would have various different units and subunits, functions and people to respond to. Nonetheless after differentiating it’s important that the different roles of the company come together and integrate to pull the organization together. The flaw that I see here is the one that was explained during our lecture. There might be too many units all around and they all have to respond to different people and what if their goals are not in sync? That creates for conflict and possibly disruption of the business cycle. This would happen amongst the lower ranks while as in the big ranks Giorgio Armani himself takes on all the responsibility for all of his ventures. Most major decisions are made by him and of course his board of directors, but is that perhaps too much responsibility for only seven people? I personally do think so. Giorgio Armani has built an empire but there is too much expansion. When people think of the Armani brand they do not think of Hotels or flowers, or chocolate. They think of classic high fashion. When competing with brands such as Versace or Gucci, it could be very difficult to try and out do them in the market since they are focusing more on the centralized fashion items. While as Armani making most of the decisions himself has to decide on how to

bring success to his other unites as well. Also in his mission and vision stating “to continually create clothes and accessories that aspire to a kind of perfection that transcends fashion. Armani's clothing ignores the constant demand for novelty and possesses an elevated character, a quality that conveys a sense of permanence in a world infatuated with the temporary. Now, Giorgio Armani is poised for the future with a vision that crystallizes his approach to fashion as timeless, and yet always timely. Giorgio Armani is committed to the long-term view, reflected by his creation of new lines and divisions, and in his investment in new technology and infrastructures.” Armani does not mention the makings of flowers and chocolates or even hotels. He’s saying he wants to create clothing items that transcend fashion. Bringing all these different units just seems out of focus for the company and just makes the structure more confusing which could again not create that sync between the employees and everything the company stands for. Therefore, my take on the Armani structure, taking into consideration what was explained in lecture, is after seeing how these ventures have been progressing to cut the unnecessary ones off. Also I hope that eventually Armani finds faith in the people working for him and decides to give them a little more power. Perhaps have a more intensive hiring process to make sure their values are aligned, like the class example of Zappos, then maybe the different units would work better and not be so broad when it comes to the decision making, as they would be the people who first hand see what is going on in the business. To conclude this paper gives an explanation of the multinational fashion house Giorgio Armani’s organizational structure. I explained how it’s divided geographically, among different clothing products, among different nonclothing products as well as who are the head’s of the

organization. I also pointed out what my opinions of the firm’s major strengths are aligned with different topics that where taught in lecture like the differentiation. As well as I explained how major strengths could be taken as major weaknesses as well, although different products make the company strong in case one fails the other prevails; if they are not generating a profit they could eventually harm the company. Also, I stated that I think it could be important to share some of the responsibility among different members taking some of the pressure off from top directors as well as possibly being more beneficial to the company in general. Overall although I pointed out where some possible weakness of the organizational structure could be, I still think Armani is a very successful company and will continue to and the employee reviews show for it.

References Feiereisen, Sharon. "10 Things You Did Not Know About Giorgio Armani." The Fashion Spot. N.p., 10 July 2015. Web. 21 Feb. 2016. Dimitrov, Evgeny. "Armani." Prezi.com. N.p., 10 Dec. 2012. Web. 21 Feb. 2016. Employee Reviews http://www.indeed.com/cmp/Giorgio-Armani/reviews?fcountry=US...