Relationship between Organization Design and People Management

Running page: HRM 1
5ODG - Part B (A.C. 1.1, 1.2, 2.1, 2.2 & 2.3) (2,000 words)
A member of the senior leadership team has recently read an
article on the relationship between sustainable organizational
performance and the strategic alignment of an organization’s
different components such as its structure, culture, processes,
and people management approaches, and is keen to explore the
following question:
“To what extent does the current ‘design’ of the organization
support organizational success?”
You have been asked to produce a report in which you need to:
1. Summarize the current internal organizational context
in terms of key influences on business strategy, and
measures of organizational performance. Include
consideration of 1. Organization type 2. Organization
elements (structures, processes and systems) 3. External
influences (STEEPLE factors) 4. Performance measures.
(AC1.2) (approx. 400 words)
Answer:
Al Mulla Group is a group of companies with an interest in many different
fields or areas and each area forms a particular business line. The Al Mulla
Group is divided into various companies’ portfolios that represent a
particular field of interest. Some of the areas that form division of the
company include engineering, insurance, manufacturing, automotive,
financial, education, and healthcare among many others. These fields of
interest are further divided into companies and are spread across 8 countries
(Al Mulla Group 2019a).
The organizational element of Al Mulla Group is complex consisting of
business lines and companies or country levels. The company has business
lines that represent various portfolios such as engineering, finance,
automotive, rental and leasing, and trading and manufacturing lines. The
company has seven executives that represent and manage various

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organizational units. These include the chief executive officer, chief financial
officer, chief administrative officer, chief strategy officer, managing director
automotive, managing director engineering and managing director trading,
manufacturing, and financial service (Al Mulla Group 2019).
External factors analysis (STEEPLE analysis)
The major dominant feature of the Kuwait economy is an industrial sector
that contributes a larger percentage of GDP. Firstly, political factors that
affect the operation of Al Mulla Group within Kuwait include freedom from
Iraq that largely contributed to the instability of the country. Secondly, the
economy of the country heavily relays on oil production and this has resulted
in a growth rate of 3% from the previous 0.8%. Thirdly, the county is small in
size but due to oil available, many people from a developing country have
contributed to its labor market. Technological factors that determine the
operation of Al Mulla Group include continuous government support for the
development of modern technologies in the country. Oil production in the
country is highly increasing environmental pollution to the point of raising
concerns and this was worse during the gulf war where many wells were set
on fire. Legal factors in Kuwait include not labor taxes through another legal
requirement must be adhered to. People in Kuwait uphold high ethical
standards and this is evident through numerous ethical standards practices
for various industries.
The performance measures of the Al Mulla Group are based on the business
line and the management of each business line. Each business line is
managed through an executive that is responsible for the quality of the
services provided at the unit. Moreover, executives periodically report to the
senior management formed by executives. According to various reports of
the company, each business line or department has been performing well as
evidenced by numerous MEP awards (Al Mulla 2019).
2. Summarize the historical and theoretical perspectives
of organization design, and give a brief explanation and
comparison of two organization design models. (AC1.1)
(approx. 400 words) - The historical and theoretical basis
of organizational design has not been fully examined
below. You have focused on the historical and theoretical

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aspects of organizational design, you also need to
compare two models such as Galbraith "Start" model etc.
Answer:
The historic perspective of Organizational Design was inclined towards
closed concept. The importance of dividing the labors for the purpose of
facilitating the transition from artisans to workers in production line. Artisans
were responsible for performing the whole task but the role of production
line worker restrict the contribution of the workers to a specific boundary.
The factor of limiting the role of the workers in the process of transition
depicts the factor of gains in industrial performance dominates the pride and
preferences of industry workers for performing the whole work. The
increasing participation of workers in the production line reflected the need
for managing and coordinating the workforce. To manage the activities of
the workers’ specific tasks for the purpose of extracting a cohesive
performance of the workers in relation to the objectives and targets of the
industry, organizational design was one of the important aspect deduced
from the process. The aspects and values like economic entities, financial
decisions and operational plan reflected the need for being dependent on the
aspect of organizational design. Dividing the work in fragments leads to the
state of employee dissatisfaction, which needed attention for synching
performance with objectives. The Hawthorne studies was focused on
psychological needs of workplace. The interrelation of employees and
organization objectives was understood during the study of Human Relations
School of Organization Designs in 1940s and 1960s. The organizational
design enabled the employers to eliminate the aspect of controlling the
workers through managers and implemented the facilitation of self-
regulating clusters of workers.
Theoretical perspective of organizational design depicted the open
concept of creating a positive working environment. The concept of
organizational design evolved from the historic believes and marked various
theories, Weber’s Bureaucratic model which is reflects the practice of strict
authority and hierarchy for effective coordination with standardized decision
making rights and procedures. Another theoretical perspective was
highlighted through Taylor and Fayol’s scientific management theory for
designing incentive plans and positions for increasing the effectiveness and
productivity. This theory reflects the principles of efficient supervision and
unity regarding authority and command (Aubry and Lavoie-Tremblay 2018). The