Assignment 2 - Group Report - CR PDF

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Assignment 2 - Group ReportBUSM 2301 - Organisational AnalysisLecturer: Ms. Do Thi Ha LanLocation: RMIT Vietnam, HNClass group number: 1Team number: 2Total word count: 3,(Excluding: Cover page, Table of Contents, Reference List & Appendix)List of team members:Le Thu Phuong s Pham Chau Anh sSamik...

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Assignment 2 - Group Report BUSM 2301 - Organisational Analysis

Lecturer: Ms. Do Thi Ha Lan

List of team members:

Location: RMIT Vietnam, HN

Le Thu Phuong s3870274

Class group number: 1 Team number: 2 Total word count: 3,000 (Excluding: Cover page, Table of Contents, Reference List & Appendix)

Pham Chau Anh s3818771 Samiksha Mathur s3818378 Tran Duy Hai Long s3836444

TABLE OF CONTENTS 1. INTRODUCTION …………………………………………………………...................................................... Page

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1.1. The global mining company’s current performance & problems ……………………………………….... Page

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1.2. Orientation toward the report’s purpose and content ………………………………………....................... Page

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2. PROBLEM STATEMENT …………………………………………………………...................................... Page

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2.1. The organizational culture problem………………………………………………………………………....

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2.2. The organizational communication flow problem…………………………………………………………. Page

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3. LITERATURE REVIEW ………………………………………………………….......................................... Page

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3.1. Concept of Organizational Culture……………………………………………………………....................... Page

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3.2. Organisational Culture in the Post-Acquisition Process...…………………………………...…………... Page

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3.3. Organizational Culture in Organizational Communication …….…………………………....………….. Page

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4. SOLUTION DEVELOPMENT AND PROPOSAL ……………………………………….………….

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4.1. Process model …………………………………………………………………………………….……….….. Page

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4.2. Implementation of the process model …………………………………………………………...….….……. Page

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5. DISCUSSION AND CONCLUSION ………………………………………………………….….….….... Page

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5.1. Strength & weakness of solution drawing Functionalist & Social Relativist paradigms ……………... Page

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5.2. How do these paradigms help? ……………………………………………………………....…....…....…... Page

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5.3. How do they hinder? ……………………………………………………………....…....…....…...……..……. Page

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5.4. Consequences of drawing form two paradigms? …………………………………………………………. Page

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5.5. Conclusion ……………………………………………………………....…....…....…...……..……..……..…. Page

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6. REFERENCE LIST ………………………………………………………………………………..……..…… Page

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7. APPENDIX: GROUP REFLECTION ………………………………………………………..……..…… Page

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8. CONTRIBUTION FORM ………………………………………………………..……..………………….... Page

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1.

INTRODUCTION 1.1.

The global mining company’s current performance & problems

Our client is a global mining company which locates their head office in Australia with numerous operations across the globe, consisting of sites in Latin America, Alaska, The Congo, Asia and four mines in Australia. In recent years, the company has faced significant growth due to acquisitions with a number of companies that operate in various phases of development. However, the post-acquisition process has resulted in two main problems: organizational culture problem and organizational cross-communication flow problem. These problems will be further discussed in the problem statement part.

1.2. Orientation toward the report’s purpose and content The purpose of this report is to analyze the various functions of the mining company, and to construct a proposed process model that is compatible with the operation’s framework in order to address the two main problems outlined above. Furthermore, this report will explicitly draw the two perspectives of Functionalism and Social Relativism in regards to the mining company.

2.

PROBLEM STATEMENT

2.1. The organizational culture problem Current problems that the mining company is facing are largely due to the conflict of organizational culture affecting the company’s management of post-acquisition processes. Especially when the mining company is merging and acquiring multinational firms, ignorance towards these parties’ cultural values results in resistance to the existing organizational culture of the company (Porvari 2014). While acquired firms have already possessed their own organisational culture, the mining company’s deterministic belief that their existing culture values are unaltered by that of acquired firms creates an unrealistic expectation that acquired firms have to find their own ways to adapt to the acquirer’s organizational culture (Hanson et al. 2011). Rogue planning efforts from each acquired firms derives from such passive post-acquisition processes and stray the whole organization further away from reaching a common management system (Vasilaki & O’Regan 2008). The synergy of organizational culture is further challenged by the authoritarian leadership style that exists in the mining company. Such culture of compliance cultivates centralized decision-making which, especially during the period of post-acquisition, causes shareholder activism (Saylor Academy 2012). Since centralized decision-making is in favor of the mining company’s top management team (TMT) in Melbourne, it creates an organizational culture that lacks collaboration and innovation from acquired 2

companies (Fagaly 2018). Consequently, employees of acquired firms do not feel connected to the conceptualized goals of top management and resist cultural changes (Grankvist, Kollberg & Persson 2004). Furthermore, authoritarian leadership lacks control over the implementation of their decisions, which results in inability to drive the economy of scale (Corporate Finance Institute 2020).

2.2.

The organizational cross-communication flow problem

Since the mining company has numerous operations across the globe alongside acquisitions with a number of companies that operate in various phases of development, the mining company faces the challenge of cross-cultural communication flow mainly because of cultural differences derived by rogue planning efforts of TMT during post-acquisition processes. Cultural difference is a factor that alters the employee communication style and the communication process in an organization, where “the greater the cultural differences, the more likely barriers to communication and misunderstanding become” (Cheng and Seeger 2012). Studies reveal that organizations with cultural differences have different leadership styles (Ralston et al., 1993), different human resource practices (Schuler 1998) and different decision-making strategies (Cushman et al., 1985). Besides, Kitching (1967) claims that actions and behaviours of TMT plays an important role in post-acquisition performance of an organization. Buono and Bowditch (1989) highlight that TMT often fails to transfer adequate knowledge about the goals and purpose of acquisitions due to lack of effective communication arised by cultural differences between the members of the acquiring and the acquired organization and it also states that TMT often fails to build shared understanding regarding the strategic goals as a whole. Consequently , Mohrman and Cohen (1994) argues that when TMT builds a shared understanding of the strategic goals within various operations of an organization, it leads to effective communication between TMT with all stakeholders, easy cross-cultural communication flow for TMT, plus clear goal and role clarity for employees. Thus, it is necessary for the mining company’s TMT to have frequent effective communication with each acquired firm to reduce the consequences of cultural differences as their TMT fails to transfer adequate knowledge due to lack of effective communication arised by cultural differences and fails to build shared vision among members of the acquiring and the acquired organization due to differences in leadership styles, human resources practices and decision-making strategies.

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3.

LITERATURE REVIEW

3.1. Concept of Organizational Culture According to Daniel and Metcalf (2001), organizational culture is shaped by voluntaristic ways of how people within the organization perceive and react to their internal and external environment. Consequently, organizational culture determines values, beliefs, and the overall work system of the organization (Kotter & Heskett 1947). Groysberg et al. (2018) and Hirschheim & Klein (1989) pointed out that the organization’s leaders are directly responsible for the deterministic structure of organizational culture ; hence, leaders need to be sensitive, awared, and proactive toward managing the equilibrium of the organizational culture. With effective leadership and organisational structure, the creation of strong culture can drive organizational goals and objectives (Groysberg et al. 2018); in the case of the mining company, are the abilities to leverage communication and scale of economy. 3.2. Organizational Culture in Post-Acquisition Process Differences in organizational culture are one of the obstacles in the integration process during the post-acquisition period. Especially when faced with an authoritarian leadership style, the bureaucratic organizational structure and centralized decision-making process that the top management team determined will further challenge a harmonized integration process to take place. Daniel Rottig (2008) found that such lack of collaborative organizational culture is the key reason leading to failures of cross border merger and acquisition. Centralized organizational authority makes it difficult for top managers to manage acquired firms’ rogue planning efforts, which often result in improper acculturation approaches that retard the integration process (Shah 2019). Though adapting a functionalist leadership culture, the mining company lacks positivism epistemology to anticipate cultural clashes that can happen with cross-border merger and acquisition. This is why the mining company should try to adopt a social relativism approach in their post-acquisition integration process. Solutions that a decentralized decision making process can provide will create a more effective leadership style transformational - that can resolve issues with shareholder activism (Fagaly 2018). 3.3.

Organizational Culture in Organizational Knowledge Sharing

According to Jian and Hanling (2009), knowledge sharing is the most important part of knowledge management. Within organizations, knowledge sharing is a complex process that is weighed by value and driven by factors like culture and communication (Calderon et al., 2015). Kim (2007) claims that culture influences the way knowledge is created, shared and used. When applying knowledge-based strategies, organizations underestimate the challenge of cultural differences, the key part of knowledge sharing.

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Thus, organizations must concentrate on having more informed TMT that can handle cultural differences as knowledge sharing depends on it (Calderon et al., 2015). Hirschheim & Klein (1989) pointed out that social interaction creates unique experiential knowledge for individuals in organizations where experiences are always changing and not necessarily same for every individual, meaning that in this case, due to the unique and idiosyncratic nature of different cross-cultural barriers, it does not allow TMT in the mining company to handle certain conflicts by applying universal laws which refers to social relativism.

4.

SOLUTION DEVELOPMENT & PROPOSAL 4.1.

Process model

Figure 1. Process Model

4.2.

Implementation of the process model

Regarding the problem that has been identified above, the conflict of organizational culture, causing cross-cultural communication in the company among its functions and employees. In particular, communication has been severely ignored in the organisation, allowing only a small number of individuals to gain a limited amount of experience, resulting in poor job performance as sales workers lack expertise in addressing the same problems and a lack of involvement. Furthermore, as the

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communication problem occurs, the company's learning environment would not plan to provide resources for cultivating learning-oriented principles. Amburgey et. Al (1990) claimed that restructuring the organization may be risky, yet once it has been made and implemented properly, it increases the company’s wellbeing. Thus, it is critical that the paper seeks to restructure the organisation of the mining company as a more appropriate working network. Based on the above analysis, it is necessary to follow the functionality working process of the KSP by emphasizing the “people'' element on some of the related departments. This means that increasing employee engagement here is paramount. More specific, enhancing employee participation, according to Becerra-fernandez and Sabherwal (2010), necessitates the organization focusing on both formal and implicit information sharing amongst departments. The recommendation for tacit information is focused on the socialization subprocess, which creates an atmosphere for the employee to communicate thier knowledge to the other. As a result, the employee's engagement will rise. Thus, “Employee Navigation '' is created to serve only a specific purpose: to guide employees in a unified direction by caring and finding interest among employees, as a result, employee morale, loyalty, happiness, and work engagement improve. (Mahalakshmi, RR & Uthayasuriyan, K 2015). According to Figure 1, the collaboration in Business Strategy, Organizational Structure and Employee Navigation would resolve the identified problem. In specific practice, after planning to merge new companies, Planning and Meeting will confirm the change in organizational structure, hence, with help from Manage Workforce Availability and Cultural Awareness and Heritage would be used as the backbone of this process, along with “Employee Navigation”, Induction and Training would have the ability to ensure. Due to the merger of many small companies, the Cultural Awareness function will take care of clearly defining the culture of the new company type, and then come up with a consensus of what is suitable and what is not for the whole organization, before the procedure is merged into a unified block. By providing a clear direction and a specific guide from the Employee Navigation, it will have the direct effect on the Induction and Training process, thus it is important to give employees this supporting service whenever facing issues. Going through these functions each time the mining company wants to expand business (by merging subsidiaries) would ensure a unity, company culture is present right from the start. Following the establishment of the fundamental bond, establishing a high-quality workplace experience for workers aids in the improvement of both physical and mental health. Constantly reviewing the process is critical for the organizational structure, since employees act as a network within departments, which increases organizational morale and teamwork in the mining industry and helps increase productivity and output.

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5.

DISCUSSION & CONCLUSION 5.1.

Strength & weakness of solution drawing Functionalist & Social Relativist paradigms

As revealed from the problem statement part, Functionalism is considered as the obstacle to organizational performance. On the other hand, it also contributes to making the organization go astray. However, the company background is based on the concept of social regulation which triggers the fact that Functionalism still remains as the locomotive of the entire organization. Overall, the system of this mining company is illustrated to be complicated with manifold different sites, Functionalism impartially detects as well as analyzes the other part to sustain its stability. Furthermore, Functionalism is involved in the procedure of delivering obvious information from the top managers to the workers (Becerra-fernandez & Sabherwal 2010). Hence, this makes the solutions drawn from Functionalism become much more related to retaining the organization structure, particular order, amendment while serving the directions and offering any policies. In terms of limitation, Functionalism appears to have sole focus on the whole progress rather than the connection among employees. This highly puts a ceiling on their creativity and freewill which threaten the property of the system. Along with those based on Functionalism, solutions drawn from Social Relativism urge the idea of sharing the information between others without any boundaries to enhance social engagements. Workers are believed to attain freedom of interacting with each other, sharing knowledge to foster at work. Also, the barrier between employees and managers also unravels which creates a more efficient collaboration among departments, gives support or counsel for each other during harsh situations. All of those create a working culture without any absolute rule, or view. Nevertheless, over sharing could lead to a harm to the organization since information could be spoiled to the business’s competitors and managers will have to confront hurdles in directing others (Beccerra-fernandez & Sabherwal 2010).

5.2.

How do these paradigms help?

When performing the organizational analysis, two paradigms are used to define the corporate nature and a grid in employee and manager perspectives. They examine and evaluate the organizational motivations, actions, and atmosphere on a theoretical basis (Hirschheim 1989). Each model, in particular, provides an unique perspective on the business environment. For example, thanks to nomothetic approach in Functionalism, business could be easier to measure efficiency of the company’s structure. Organizations may utilize any of those variables as a methodology to influence people’s mindsets and acquire a long-term plan to keep and expand one organization (Hirschheim 1989).

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Furthermore, paradigms may help in the collection of information about the problems and the understanding of how to achieve them (Hirschheim 1989). Managers, therefore, can recognise the issues and the measures to obtain the appropriate information to use in order to be fully aware of the situation.

5.3.

How do they hinder?

Despite the fact that they seem to be rational and systematic, these paradigms are still theoretical material for referencing and analytical methods for dealing with its problems, especially when it comes to the ability to effectively respond to radical changes. On the other hand, it can be unreliable when used in a practical situation since it is dependent on a variety of circumstances, most notably human communication and practices. To strengthen the previous statement, organizational communication is one of the initial factors influencing the quality of decision making by the top of managers (Tourish & Hargie 2004). Otherwise, in a more globalized world, it may often overlook the power of top managers, affecting the overall hierarchy, as rapid workforce growth may generate obstacles and adversities in managerial efficiency (Longenecker, Neubert & Fink 2007). Furthermore, while the environment generated by the organization is negatively criticized in the problem statement for being unmotivated for workers to improve their skills and their learning, the mining company has been operating so far that often allowing any alterations will carry over several new, drastic results that directly affect the entire organization.

5.4.

Consequences of drawing form two paradigms?

Overall, Functionalism and Social Relativism both reveal scenarios in both objective and subjective views. These are, ...