Leadership in Action

This paper will discuss the simulation, "Leadership in Action". The simulation is based on a company called Smith & Falmouth(S&F), who requires assistance to provide the company with conceptual information about the organization structure and to provide specific recommendation to be successful in the next three years. This paper will describe the formal culture of the organization and how this structure compares with other organizational structures. How the companys informal culture influences their effectiveness and formal structure will also be addressed. The role of power and politics will be looked at as well as which leadership style would be the most effective for the Chief Operating Officer (COO) for S & F's structure and culture.

Organizational Structure is defined by McShane-Von Gilnow as the division of labor as well as the patterns of coordination, communication, work flow, and formal power that direct organizational activities. (http://www.stu.uophx.edu/secure/resource/resource.asp Chapter 17 p 506) The current structure of S&F resembles a Functional Structure. This type of structure organizes employees around specific knowledge or resources. (Chapter 17 p 516) This can be seen by how S&F is currently divided into the following workforce product divisions: a web development team, a logistics team and a marketing team. The project manager of S&F is currently responsible for handling the web operations team, who has six members. This team is responsible for maintaining online sales, comprising the website, and handling the online payments. The project manager is also responsible to work closely with the logistic manager who has three members in his logistics team. The logistics team is accountable for managing orders, customer support, and delivery operations and must report order fulfillment status to the marketing manager. Currently, the marketing manager is responsible for coordinating project lines, marketing budgets, and promotional activities for the company throughout the U.S. and Canada. https://www.stu.uophx.edu/secure/resource/vendors/tata/sims/hrob/hrob_simulation1.html

According to the text, Organizational Behavior, this structure is common for organizations to use at some level or at some time in their development, but is quite different from a Divisional structure. A divisional structure groups employees around geographical areas, clients, or outputs. (Chapter 17 p 517) Rather than dividing an organization into specialized departments, an organization with this structure may operate as subsidiaries. This structure is more widely seen with international organizations, for examples McDonalds, or Hewett Packard. (Chapter 17 p 517) Another structure that is different from a functional structure is a Matrix structure. This is a type of organization that overlays a divisionlized structure (typically a project team) with a functional structure. For example, employees may be assigned to a cross-functional project team, but they would still belong to a permanent functionally unit. (Chapter 17 p 519)

An organizations informal culture can influence the effectiveness of the formal structure in many ways. This was prevalent in the simulation by the current socigram. At S&F the teams are strongly aligned to their leaders and aside from the Marketing manager, all of the other employees restrict themselves to official interaction with the leadership consult. As a result of this informal culture the effectiveness of the organization is put at risk due to the culture of not welcoming change. Since the informal group also plays a key role in the development of the organization, the informal culture can hinder the growth of an organization.

"Power and Politics are indisputable facts of social and organizational life that must be understood for organizational success." (Walumbra, Power and Politics in organizations: implications for OD professional practice) At S&F politics and power also play a key role in the company. The first example of power is seen starting at the top level of management, the Chief Executive Officer (CEO) demonstrates her role of power over her subordinates by controlling their job security and promotional opportunities. The CEO begins to use her power of control by