Organisational Theory and Practice

This document explores various aspects of organisational theory and practice at British American Tobacco plc, including management style, organisational structure, leadership style, power and influence, and types of motivation. It provides insights into the principles and functions of the management style adopted by the CEO, the structure and culture of the company, the leadership style of the leaders, the impact of power, influence, and conflict, and the types of motivation used at BAT. The document also offers suggestions and recommendations for improving organisational performance.

ORGANISATIONAL
THEORY AND PRACTICE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................4
A.) Type of Management Style adapted by the CEO of British American Tobacco- its
principles and functions...............................................................................................................4
B.) British American Tobacco Company’s Structure and Culture..............................................5
C.) Leadership Style adapted by Leaders of British American Tobacco....................................7
D.) Impact of power, influence and conflict at BAT...................................................................8
E.) Types of Motivation at British American Tobacco plc.........................................................9
F.) Literature by using corporate examples...............................................................................11
G. Suggestions and recommendations for increasing organisational performance...................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
In every organisation, various tasks are performed by individual employee, the teams
comprising of more than two employees and the organisation itself to reach the greater heights of
success and growth (Marume and Chikasha, 2016). Various theories help in increasing the
efficiency of all the processes performed in the organisation and the overall productivity.
The organisation is required to fulfil the needs of its maximum customers and the various
stakeholders. When the individual employees are focussed upon, then theories of motivation,
personality and role are highlighted (Gunasekaran and et.al., 2018). When it comes to teams,
then leadership, power and influence theories are implemented and when the whole organisation
is laid emphasis upon then its structure and culture are majorly highlighted.
The report will shed light on all the aspects of the British American Tobacco plc (BAT)
multinational company which manufactures and sells various varieties of cigarettes, tobacco and
the other nicotine products. It is headquartered in London, England, UK. Being a public limited
company, BAT has 55000 employees who contributed majorly in earning the revenue of £25.877
billion and the net income of £5.849 billion, noted in 2019 (British American Tobacco, 2020).
The management style and its principles & functions used by the CEO of BAT will be described
in the report. It will also analyse the structure and culture at the workplace and its effect on the
employees. the leadership style and various types of motivations will also be highlighted. The
description of all the topics will include the issues which are faced by the company in
implementing various processes and functions. It will also suggest the ways in which
organisational structure can be improved to increase the performance of the employees and the
company. The report will also give certain corporate examples along with some
recommendations which will help the company to enhance its performance and growth. Every
aspect of the company will be justified by the use of different models which helps the company
to give a deep insight about the processes it follows and the methods in which they can improve
those weaker areas in order to face substantial growth.
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MAIN BODY
A.) Type of Management Style adapted by the CEO of British American Tobacco- its principles
and functions
To achieve this successful position, the managers of the BAT plays a major role as all the
processes of BAT are finalized and reported to the managers first then implemented. The
managers of the companies use various management styles according to which all the functions
are exercised by them such as planning, organizing, decision making and also staff management
which helps in achieving certain organisational goals. There are numerous management styles
like Visionary, Pacesetting, transactional, democratic, authoritarian, Fayol and many more
(Kristijono and et.al., 2020). The type of management used by the managers of the company and
its implementation decides the progress of the company.
The management style adopted by Mr. Jack Marie Henry David Bowles (CEO of BAT) is the
Fayol;s Management style which can be implemented by using the Henri Fayol’s management
theory which is basically a model of interaction between management and the personnel. This
model helps the companies in order to manage the staff productively. The theory consists of
fourteen principles which are Division of Work, Authority, Discipline, Unity of Command,
Unity of Direction, Subordination of Individual Interests to general Interests, Remuneration,
Centralization, Scalar chain, Order, Equity, Stability of Tenure of Personnel, Initiative and
Espirit de Corps (Parker, 2016).
But it is very difficult for the companies to follow all these principles. So Fayol concluded five
basic functions of Management which is used by British American Tobacco company
effectively. These basic 5 functions of management style are Planning which means there must
be a systematic plan and schedule for every process in the company, Organizing means the
management must also ensure that the desired resources are available at the time of production,
Commanding which states that each and every activity of the personnel must be encourage and
directed by the management, Commanding assures that the teams in the company are working
together in a cooperative fashion in order to achieve the organisational goals and last but not the
least controlling which is the addition to the normal functions of management under which the
manager ensures that the teams and the individuals follow their commands.
BAT faces lot many issues after following this management style as under this the managers
only focusses on the own experiences rather than doing an empirical research. It is also much
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inward-looking and does not give much priorities to the needs of the customers which
contributes more in enhancing the customer base and to earn large profit margin. The major issue
in this style is that it uses the traditional methods and practices while in today’s emerging
markets, the BAT need more innovation and creativity with advanced technologies. But the
Fayol management style only follows the management skills and does not lays emphasis to
increase the customer base by using advanced methods.
B.) British American Tobacco Company’s Structure and Culture
The major four building blocks on which the company focusses upon are Productivity, Growth,
responsibility and developing itself as a winning organisation (Barraclough and Gleeson, D.,
2017). The company implements various strategies for working on these block interdependently
and to build long term shareholder value.
Organisational Structure of BAT is so simplified and systematic which gives a clear approach
to all the employees regarding the information about whom they must report to and when, their
roles and also the levels through which various decisions pass during decision making process
(Organizational Structure of British American Tobacco, 2019). The new entrants basically use
this structure in order to know about the management of the company and the hierarchy which is
referred to as Chain of Command.
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Figure 1: Organizational Structure of British American Tobacco
Source: Organizational Structure of British American Tobacco, 2019
The company believes the employees to be its biggest assets and gives them the whole credit for
its substantial growth (Islam and et.al., 2019). In order to improve its performance, BAT must
improve its organisational structure from Simple to functional. For that, the company must
segregate the employees according to their different roles and their responsibilities must be
mentioned in the structure. So that no one working in the company can divert from performing
their roles effectively.
Functional organizational structure can also help BAT to run the business and earn a large profit
margin by grouping the employees according to the skills and the expertise. It also provides a
clear cut hierarchy and reduces the level of confusion among the employees and their duties to be
performed.
The culture at BAT is much motivating as the main focus of the company is on the quality of its
employees and teams who performs various activities for increasing its progress. The company
follows the cultural model in order to increase its performance and make the employees satisfied.
The employees at BAT are very ambitious, brave and much adaptable who are always ready to
accept the challenges and to bring in the most innovative changes which increases the overall
reputation (Haque, 2017).
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The model also states that there must be enhanced trust and cooperation, fewer disagreements
and more effective decision-making among the employees along with a sense of powerful
understanding (Hossain, 2017). The employees and the teams are the major factors which drives
the high performance in creating innovative leaders which helps in managing the diversity at the
workplace. The top management and the executives of BAT tries to extract the talent of its
employees and support them continuously to deliver more strategies and innovative ideas. It
brand “Bing your Difference” has a strong presence online and offline both.
C.) Leadership Style adapted by Leaders of British American Tobacco
The CEO of British American Tobacco, implements the Transformational Model in order
to adapt the Transformative leadership style. The company believes that the leader must be a
catalyst of change. So, the transformative leadership is chosen by the CEO so that all the
employees can be guided and inspired by the leaders in a different way each time in order to
achieve organisational goals (Fooks and et.al.,2017).
Therefore, the reason to choose this type of leadership style is that it is all about values and also
focusing on higher order needs rather than short term goals (Jebin, 2016).
The four components in which the Theory of Transformational leadership is divided are as
follows:
 Charisma influence is mainly for measuring the degree in which the behaviour of the
leader makes them the role model for the employees if they set much clear values.
 Inspirational Influence is basically the degree in which the leaders inspire the other
employees for achieving the organisational goals and performing tasks accordingly.
 Intellectual Stimulation evaluates the degree in which various challenges are accepted
by the leaders and the employees are motivated to fulfil them with their innovative skills
and abilities which contributes positively towards the mission and goals of the
organisation.
 Individual Attention lays emphasis on attending the employees individually in order to
fulfil their needs and also appreciating them for their positive contribution towards the
organisational objectives.
By following above component of transformational leadership, the leaders can inspire the
followers for greater achievement and growth of BAT. The CEO of the company mainly aims in
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brining innovation and creativity in all the processes and for that it encourages the employees to
adapt themselves according to the change which is required for enhancing the productivity and
the profitability as well.
So, the transformative leadership can be used to increase the effectiveness of the organisation by
managing its various operations and force the employees to come out of the box of comfort zone
and follow the path of the leaders to achieve the mission and objectives of BAT.
On the other hand, it can result in various issues like in order to achieve the long term goals, the
employees need to work long hours which can make them tired and dissatisfied resulting in low
retention of employees. BAT can also face risk by following such style of leadership as in long
run if there are no right people to assist the details there can be lot many risks for the company
and the people. since the decision to bring changes lies in the hands of the transformational
leader, sometimes wrong decisions can be made and the employees become forced to follow.
D.) Impact of power, influence and conflict at BAT
Power plays an important role in the organisational activities. It can impact the organisation and
the employees positively as well as negatively (Sakib, 2018). Its impact in BAT can be evaluated
by the French & Raven model who has explained 5 bases of power as follows:
Coercive Power: The punishment reduces the employees’ satisfaction along with lack of
commitment and withdrawal of employees from BAT.
Legitimate Power: Under this, the employees feel that their manager has a complete right to
give them orders according to their position in the British American Tobacco.
Reward: Here the manager at BAT rewards the employees in form of monetary compensation or
improved work schedules.
Referent: It is mainly based on the trust. It is derived from the employees’ respect for manager
and the desire to emulate someone in BAT.
Expert: It rests on the belief of employees that an individual has complete knowledge or highly
specialized skilled set.
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Therefore, the power exercised by various levels of employees working in BAT can impact the
organisation positively or negatively depending upon the aim to exercise it.
Influence
The ability of the employees at BAT to have a sort of influence the organisation through
the quality management depends upon the size of the company and the position on which the
person is designated (Kokemuller, 2020). The Top-Managers at BAT have a greater degree of
big-picture influence while the front-line managers often have influence on the regular activities
of the employees. The attitude and level of respect of manager greatly influences the culture of
the various departments of BAT. The top managers at BAT has more control over the vision and
direction of organisation but front line ones guide the staff to move towards shared objectives.
Conflicts
As the British American Tobacco employs people from all over the world, its workforce
is diversified with people from different backgrounds and cultures. When various people come
together, conflicts are obvious to happen. But the management at BAT strives hard to resolve all
the conflicts thereby making the overall environment calm and healthy. The managers of the
company ensure that justified decisions are made and no employee gets hurt or feel biased. The
impact of the conflicts is that the individuals becomes mentally unstable which results in less
productivity and overall progress. When the conflicts are not solved at organisational level, it
reaches the courts which destroys the image of the company like BAT.
E.) Types of Motivation at British American Tobacco plc
It is very important for the companies to keep its staff motivated in order to increase its
productivity and profitability. BAT also follows various motivational theories to motivate its
employees effectively. The best example can be of the Maslow’s Hierarchical needs which is a
motivational model in the content theory designed by Abrahams Maslow which gives a deep
insight about motivating the individuals by fulfilling human needs and requirements.
CEO of BAT believes in implementing thus motivational theory in its company so that the needs
and the demands of the people at the workplace can be fulfilled and they remain motivated
throughout performing the tasks (Glantz and Bareham, 2018). Physiological needs mainly
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include the factors which help the employees to work comfortably and creates a sense of
satisfaction and encouragement in them. BAT provides comfortable and satisfactory working
environment with proper light and sitting arrangement which makes the employees feel better
and they prefer working at the office rather than working from homes.
Safety needs are also to be focussed upon which included workplace safety, job security, health
insurance policy etc. Mr, Jack Bowles ensures that these needs of the employees are fulfilled
which can lead to satisfaction among the individuals (Borrelli and et.al.,2018). Along with all
these needs, the social needs are also to be fulfilled and for that the company promotes two-way
communication with the top management directly so that the employees can directly approach to
the executives regarding any issues such as payment, workload, work-life balance and many
more. Management at BAT also ensures that the employees are working in a team which helps in
fostering effective communication and sharing of opinions and views to draw a significant
conclusion and to come up with the best decision for the organisation (Almas, 2016). The
company also focusses on the self-esteem needs of the employees by rewarding them regularly,
appreciating them for their best performance and also make them feel valued by considering their
opinion in all the processes of decision-making. This makes the employees feel motivated and
they also realize that their point of view also contributes towards the progress of the company
which makes them confident fulfilling the self-actualization needs (Ryan and et.al.,2020).
Therefore, BAT focusses on all the ways to motivate its employees which is clearly evident by
its employee retention and the brand image in the global market. The company must monitor
regularly regarding the motivation of each and every employee in order to increase the
productivity.
F.) Literature by using corporate examples
As per the view of Ollong (2017), if the companies have healthy and motivated culture at the
workplace, then the employees strive hard to perform better in order to increase the productivity.
Organisation behaviour not only deals with the management but also with each and every
employee, workers, teams and everyone who plays their role at the workplace and its policies.
In support of the above view of author Watts, Hefler and Freeman (2019), elucidated that in
order to achieve the organisational goals within the timeframes, the company must ensure
healthy environment and boosted up employees who can accept every challenge and work upon
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it. The study further explained that healthy organisational culture not only means the motivated
employees but also perceived value for the consumers and the customers of the company. The
author also stated that in order to keep the workplace motivated, the management of the
companies follow various motivational tools and emotional intelligence, Adam’s Equity Model
etc. to make the employees satisfied and increases the employee retention and the goodwill of the
company.
Taylor (2019), have quoted over the importance of organisational culture and the motivational
theories by giving an example of well-known company in retailer industry of UK i.e., Marks &
Spencer in their previously published articles. The company always focussed on to fulfil the
changing demands of its customers by producing the products according to their needs which
helped it to gain a large customer base and higher profitability. The motivational theory of
Maslow’s hierarchical needs was used by the M&S management in order to keep the employees
motivated and retain them so they can contribute towards greater productivity which can help the
company to reach to greater heights of success in terms of large customer base and enhanced
brand image. Its organisational culture is also much effective which helped in achieving its
objectives within the timeframes.
G. Suggestions and recommendations for increasing organisational performance
For increasing the organisational performance of BRITISH AMERICAN TOBACCO, the
CEO of this venture have to focus on day to day improve its different skills and abilities relating
to management and leadership. This is really a necessary task to Mr. Jack Henry. Without taking
any step towards developing skills, this tobacco firm can’t gain huge profit margins in market
place (Kohntopp and McCann, 2020). On the other side, as a CEO, he needs to develop skills
and abilities of its different employees as well, because employees a business has enabled it for
gaining huge profit margins in market place. Mr. Henry need to adopt and implement theories of
motivation called; content and process. By using these theories, it will be able to highly grow
performance and productivity of its employees. These theories will be motivated to himself as
well.
The marketing manager of company can use digital marketing strategy for improving its
organisational performance. Basically, this digital marketing strategy has helped to businesses
for attracting large number of customers in market place. So that, this strategy will support of
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existing tobacco firm as well. In this dynamic world, most ventures have focused on hiring
talented and skilled people or employees within their daily operations. However, British
American Tobacco company already has an effective workforce, but the management have to
make an effective work culture for always retaining skilled and talented employees in workplace.
Top-level management of the company need to focus on providing excellent quality of
products and services. This is mandatory task to this tobacco firm, because most customers
within the UK like to buy products and services only through such brands which believes in
providing products with an appropriate quality (Sarich, 2016). For maintaining effectiveness
within own products and services, existing management can use the concept of operations
management. Basically, operations management provides different approaches relating to quality
control of products and services, like; TQM (total quality management), JIT (Just in Time) and
Lean production etc. By considering these all approaches Mr. Jack Henry can simply improve
quality of its different products and services. CEO can adopt different approaches and models of
leadership as well, like; democratic or participative, autocratic, delegative, coaching, ethical and
transformational etc.
CONCLUSION
On the basis of above findings, it can be concluded that Mr. Jack Henry is a very effective
personality, and he is fully capable to run different operations of British American Tobacco
company progressively. CEO of this company has different styles of management and leadership
which helps him for systemically managing various activities and operations. Some major steps
also have been discussed above which has taken by chief executive officer for achieving very
higher performance and productivity in market place. It can be also concluded that the company
is affected by different internal and external factors. The CEO of company have to avoid those
all activities and operations within its workplace which can negatively affect its productivity and
performance in market place.
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REFERENCES
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Watts, C., Hefler, M. and Freeman, B., 2019. ‘We have a rich heritage and, we believe, a bright
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