Impact of Structure and Culture on BP's Organisational Performance

This report provides a comprehensive analysis of the relationship between organisational structure, organisational culture, and organisational performance, using British Petroleum (BP) as a case study. It begins by defining organisational structure, including hierarchical, functional, horizontal/flat, and divisional structures, and organisational culture, encompassing power, task, role, and person cultures. The report then explores how BP utilizes a combination of divisional and functional structures, and how its values of safety, respect, excellence, courage, and teamwork influence employee behavior and performance. The report examines the impact of organizational structure and culture on BP's productivity, employee autonomy, and overall organizational performance, concluding that both structure and culture are crucial for creating value and achieving organizational objectives within BP's large and diverse workforce.

Introducing the
Modern Workplace

Table of Contents
INTRODUCTION...........................................................................................................................3
Organisational Structure..............................................................................................................3
Organisational Culture.................................................................................................................4
Influence of organisational structure on organisational performance..........................................6
Influence of organisational culture on organisational performance............................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
This report aims at discussing relationship of organisational structure and organisational
culture with organisational performance. Organisational structure refers to system that outlines
order and direction of activities in organisation. Organisational system defines role and
responsibilities within organisation and along with this also outline reporting relationship.
Organisational culture is concerned with expectation, experience and philosophy of organisation
and underlying values that govern behaviour of people in organisation. British Petroleum (BP)
has been contextualised for this report, it is a British multinational oil and gas company. It was
founded in 1909 and is headquartered at London, England, UK. BP employs around 70100
employees to carry out its operations around the world. BP operates in Europe, North and South
America and Australasia, Asia and Africa (Kumar, 2019).
Organisational Structure
Organisational structure are of several types that differentiate on the basis of how roles
and responsibilities are designed in organisation. Structure also contribute in determination of
reporting relationships within organisation and along with this autonomy within organisation can
also be determined through organisational structure. There are certain organisational structure
that are very strict and rigid to work in whereas in some organisational structure flexibility is
allowed to employees of organisation. There are several types of organisational structure and
their impact on performance mainly depends on, how suitable they are for the organisation in
which they have been employed. Types of organisational structure are-
Hierarchical Organisational Structure
This is a structure of organisation in which flow of power or chain of command goes
down from CEO and other top managerial positions to low or entry level employees
(Nwachukwu and Chladkova, 2019). In this organisational structure every employee have a
supervisor and in this type of structure role and responsibilities of individual ion organisation are
clearly defined. Along with this, everyone remains aware of whom they should report. This type
of organisational structure is highly appropriate for traditional organisation and specially those in
which nature of work is repetitive and frequent changes are not really required.
Functional Organisational Structure
In this structure of organisation starts from top authority of organisation. In this type of
organisational structure employees in organisation are structured as per their skills and

corresponding functions in the organisation. In this type of organisational structure each
department is managed separately by employees who are skilled in that area of function (Su,
Chen and Wang, 2019). For example- Finance department in organisation is managed by those
who are skilled in finance. This structure is appropriate for organisations with several
departments and large size.
Horizontal/Flat Organisational Structure
This type of organisational structure is one in which there are few levels in organisation
and between upper management and staff-level employees. In this type of organisational
structure employees are more responsible and this also fosters more open communication.
However, it can also create confusion and ambiguity in employees regarding their job role within
organisation because there is no supervision . This structure of organisation is appropriate for the
organisation with less number of employees and also for organisations where less supervision is
required.
Divisional Organisational Structure
This is a type of organisation structure in which organisation have different divisions and
these divisions of organisation have control over their own resources. This is similar to operating
a company within a larger organisation. Each of the division can have its marketing team, HR
team and IT team. Divisions in this structure are mainly based on market, product and on the
basis of geographical operations of the company (Devinney and Dowling, 2020). This type of
structure is highly appropriate for the organisations who has multiple businesses, and those who
are large organisations. This is because this type of organisational structure enables large
companies to stay flexible.
Organisational Culture
Organisational culture refers to collection of expectations, values and practices that guide
and inform actions and decisions within organisation and to all employees and people working in
organisation. This also defines way in which one should behave in organisation and in several
ways these are reinforced within organisation to ultimately shape perception and understanding
of employees. There are different types of culture in an organisation and as outlined by Handy's
model of organisation culture, types of culture are-
Power Culture

Power culture refers to culture of organisation in which power in organisation remains
with few people who are authorised to make all decisions in organisation (Gao, 2017). These few
people with power have special privileges in organisation and using these privileges they can
influence decisions and actions of other people in organisation. These are major decision-makers
and policy makers in organisation and everyone else is organisation is required to do what these
people decide. This means that subordinates in such organisation do not have any other choice
but to follow and do what they have been asked by these people with power. Innovations and
creativity lacks in such organisation because of no free will to do work. This culture is
appropriate for organisations in which repetitive work is performed. This is also appropriate for
organisations in which employs are not very well skilled to perform work and be accountable.
Task Culture
Task culture in organisation is one that is formed or developed when there is requirement
to achieve specific goals and objectives or solve some particular problem. In this culture of
organisation, team is formed within organisation in which individuals with similar or same
specialisation or individuals with common interest come together to achieve a common goal or
objective. In this each team in organisation have four to five members and every member in team
have to make equal contribution. This culture is appropriate for organisations in which teams are
frequently developed because of nature of organisation (Cui, Liu and Mou, 2018). Team-based
organisations are the one in which this culture is appropriate.
Role Culture
Role culture in organisation is a culture in which every employee or member in
organisation have certain specific roles and responsibilities and these, role and responsibilities
are according to their specialisation. The reason behind linking their role and responsibilities
with their specialisation and educational qualification is to ensure that best out of employees can
be extracted. In this type of organisational culture employees accept challenges and decide what
the best employees can do. Every organisation in such culture are required to be accountable for
something and have to take ownership of work that has been assigned to them. In this culture
power of individual come with the position of people in organisation. Role culture is appropriate
for the organisations in which every role and responsibility of employees is clearly defined. This
is also appropriate for organisation who employs different types of individuals on the basis of
requirement of job.

Person Culture
Person culture is an organisation culture in which employees of the organisation consider
and feel that they are more important than organisation. In this type of organisational culture
individuals are more concerned about their individual benefit rather than organisational benefit
and success. In this culture of organisation, employees come to office and do not get attached to
it, they work and get money and this is only way they stay associated with organisation
(Mierzwa and Mierzwa, 2021). Simply, in such organisational culture employees are not loyal to
organisation which an ideal context should be. This type of culture is appropriate for the
professional firms of lawyers or accountants.
Influence of organisational structure on organisational performance
Organisational structure of BP has significant influence on its performance. As discussed
above different types of organisation are suitable and appropriate for different types of
organisation. This affect organisational performance in several contexts such as responsibilities
and accountability given to individuals in organisation, autonomy and freedom of decision-
making given to employees. This has significant impact on how people in organisation perform
which build overall performance of organisation. BP follows a structure of organisation that
combines divisional organisational structure and functional organisational structure. This means
that BP is a large organisation and this is why it is structured in divisions based on its products.
BP has several products offerings and this is why it has different divisions in which it is
functioned. Functional organisational structure is one in which employees are organised
according to their specific skills and expertise.
This kind of organisation structure enabled BP to achieve high organisational
performance, this means that BP ensures that every division in organisation has specialised
people to complete given task (Taştan and Davoudi, 2017). Through this, organisation structure
BP also becomes able to get the best possible advantage of skills and knowledge of employees.
Functional organisational structure also ensure that everyone is aware of their role and
responsibilities and because of this, role ambiguity and confusion does not arise and people are
able to perform their work effectively.
Concerned with influence of organisation structure on performance of organisation a
structure that is not properly organised, lead organisation to low productivity. This means that in
organisational structure where there is no autonomy, employees can not perform to best of their

capacity. In such situation creativity and expertise of employees also remain unused. However,
in BP employees has been provided adequate autonomy and because of this, they are able to
utilise their creativity and innovation capabilities and provide benefit to organisation. Along with
role and responsibilities, organisation structure also determine supervision in organisation and
supervision has strong impact on how employees perform within organisation (Manolache and
et.al., 2018). A strong supervision in which individual does not have any kind of authority to
make decisions, performance of individuals is likely to reduce.
Influence of organisational culture on organisational performance
Organisational culture is also one of the very important element to influence
organisational performance. Culture consist of areas of consideration that determine what and
how people should do something. BP's values guide actions and decisions of people within
organisation and values that guide BP include safety, respect, excellence, courage and one team.
These are values that suggests that employees in BP are required to and expected to work
considering excellence in their work. One team is a value according to which employees in BP
are expected to consider that organisation is above individual benefit and they should work in
harmony with other members of organisation.
Such values positively influence organisational culture and employees and members in
organisation remain aware of what is expected of them in terms of performance and in terms of
behaviour and conduct within organisation. Employees within organisation get greatly
influenced by its culture and this reflect through their performance in organisation. Employees
when consider that they are part of organisational environment and when culture guide
employees in a way that is appreciated by employees in such situation they improve their
performance and work hard to achieve organisational goals. However, when employees do not
consider that culture of organisation consider them important and they get negatively influenced
by organisational culture, in such situation their performance is likely to reduce. Most
importantly organisational culture influence collective performance of employees and this affects
overall organisational performance (Henriksen, Storm and Larsen, 2018). In context of BP it has
been able to positively influence employees by several means and ways and consider employees
as an important element of organisation. This is the reason that it has been able to achieve
organisational objectives through collective organisational performance. BP has strong values for
organisation and to guide organisational functioning and along with this, it has enabled

employees to live values of organisation. BP employs around 70000 employees and this is why
having a strong and effective culture of organisation is necessary to create harmony in efforts of
all these employees being employed by BP.
CONCLUSION
On the basis of above discussion, it can be concluded that organisational structure and
organisational culture are very important for creating value for organisation. Along with this,
structure and culture of organisation also have very important influence on organisational
performance. Organisational performance is concerned with collective efforts and performance
of all employees within organisation, which enables organisation to achieve its goals and
objectives. Report discussed organisational structure and organisational culture and their types
and along with this, appropriateness of organisational culture and structure in organisation was
also discussed in report.

REFERENCES
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