Structure in Contemporary Firms: Implications for Stakeholders HR5053

This essay identifies different aspects of organizational structures in contemporary firms like Uber, Facebook, and Google, examining the implications for the organizations and their stakeholders. It draws on theoretical frameworks to analyze hierarchical, vertical, and team-based structures, assessing their impact on decision-making, communication, and stakeholder engagement. The analysis considers how these structures affect employees, customers, investors, and other relevant parties, highlighting both positive and negative consequences. The essay also discusses the role of contingency theory and system approaches in adapting organizational structures to changing environments, emphasizing the importance of flexibility and responsiveness in contemporary business.

Identify different aspects of structure in some
contemporary firms What are the implications
for the organisation and its stakeholders Draw
on theory

Table of Contents
INTRODUCTION 3
MAIN BODY 4
CONCLUSION 10
REFERENCES 1

Different aspect of organizational structures in contemporary firms
The structure of the organization plays an important role towards the organization and its
working. As per the execution of organizational structure the company may work and divert its
initiatives and moves towards the organizational objectives (Joseph and Gaba, 2020). As
stakeholders are those group of individual who have an interest towards the company and its
working which would again related with the prevailing organizational structure (Bundy, Vogel
and Zachary, 2018). With the help of this essay the concept of organizational structure and its
implication with respect to various companies and its working will be made discussed. In the
same way the concept of organizational structure and its relation with the stakeholders will be
made discussed.
Organizational structure refers to the structure in which the entire organization would
work and make perform its function (Dedahanov, Rhee and Yoon, 2017). It plays a major role in
the attainment of the objective of the company. there are various types of the organizational
structure including the functional, divisional, hierarchal and various other. As per the implication
and adoption of the organization structure the company may perform and formulate its function
(Winnubst, 2018). In case of the structure which is followed by the Uber is related with the
hierchale structure in which the information will be flow from one level to the another. As per
this structure there will be a hierarchy in which every entity except the one would be counted as
subordinate which means that there will be one head under which all the subordinate will work
(Kanter, 2019). This will lead to better decision making because of the holding of power in one
hand and the entire organization and the entities will make follow of the decision of the top
management. With the following of this structure it would be easy for the company to make
incorporation of the changes as per the changing conditions. In the same way the model which is
followed by the Uber is multisided platform business model which would connect the customers
and the passengers in order to enable cheaper transportation and additional income source. This
means that with the aspect of work various other elements in terms of employees and their work
would be watched and controlled in the organization. This means emotions and feeling of the
employees along with the work will be looked in the company and its working. In the same way
with the persistence of such environment and the following of the concerned structure its
concerned stakeholders will be positively impacted in terms of making it attract towards the
company particularly the employees. In the same way with the aspect of following of the

multisided platform the Uber will be able to meet its objectives in terms of enabling best services
to its customers with leisure and comfort. In the same way with the aspect of changing situation
and adoption of the new changes like the driverless cars and replacement of the human resource
with the robots will lead to play an important role in respect to the company. This will also lead
to impact the stakeholders of the Uber. This can be understood as the work of the employees will
be influenced as per the working of the organization in terms of learning the new things with
regard to the digitalization and the new mode of the working.
Thus, it can be analysed that organisation whether it is small or large it requires a
structure for meeting its organisational goals. On the contrary note a firm like Uber uses the
hierarchical organisational structure that helps the organisation in several ways that its with the
inculcation of this structure it has helped the company in achieving great heights and success. As
because of the clear chain of command through the hierarchical structure there is proper channel
of communication between the individuals of the organisation and provides the organisation with
a predictable paths. This in turn helps the stakeholders of the company in effectively formulating
effective strategies and policies and effectively implementing those strategies so that they can
achieve maximum level profits and revenue. On the other hand, it helps Uber in creating an
environment with higher level of specialization in its working environment which helps the
company in concentrating on specific skill sets. Thus, with specialisation in its working
environment it helps in optimum utilisation of the resources which in turn helps in increasing the
efficiency of the company as well as the employees working. Thus, at certain time it may hinder
the organisation due to its poor inflexibility. That is the hierarchical structure slowly adapts to
the changing needs of the organisation. That is with the slow pace of adaptation it becomes
difficult for the companies to maintain it position in the market and lead the company towards
growth. Also, changes are important as they help in leading the company ahead of its
competitors that is necessary for every organisation.
On the other hand, in case of the Facebook which follow the vertical based organization
structure in which the role and responsibilities of all the level i.e. the top, middle and the lower
level would be well defined so that the company will be able to make accomplishment of the
goal. In the same way with the following of such type of the structure and the consideration of
the view of the customers which is also one of the major stakeholder group would lead to assist
the company in terms of the goal attainment (Pérez-Lara and et.al., 2020). In addition of this the

business model that is being followed by the Facebook is related with the allowing of using its
services for free of cost its users. However, it makes money with the aspect of advertisement that
is being made by the businessman which will acts as an important role in the generation of
revenue. With the following of organizational structure of the vertical structure the organization
as well as its stakeholders right from top to bottom level will be benefitted in terms of integration
towards the decision making as well as attainment of their individual goal. In the same way the
other stakeholders that includes the customers would also be positively impacted in terms of
getting the free services. With the rising of the popularity of the company with regard to its
working the other stakeholders including the investors and external parties would also be
impacted in terms of making it attracted towards the company for the performance of the
transactions. Since the structure that is being followed by the organization would be made a great
impact towards the company and its working which would clearly be seen in the Facebook
wherein the adopted structure and the business model would lead to assist the company in the
attainment of its objectives. likewise, its stakeholders will also be impacted which may be
positive or the negative. This can be evidenced in case of Facebook wherein the stakeholders will
be positively impacted in terms of availing its services for free of cost in case of customers,
employees in terms of presence of adequate authorities and various other. However, the
stakeholders like the managers and the owners will also be negatively impacted in terms of
requirement of more time in decision making or the creation of confusion with the aspect of the
involvement of various level of management or the flow of information in top-bottom manner.
Thus, with the use of vertical structure in the organisation it has been beneficial for
Facebook as it has helped the company in providing clear line of authority that not only helps in
flow of effective communication channels but also help the company in improving its control by
tightening the span of its control. With the effective monitoring and controlling it helps the
company in building a work force environment which has higher level of efficiency that helps
the company in increasing its profit margins and leads the company towards success. Also as
there is close monitoring of the activities of the employees and subordinate it helps in effective
management of workforce. This in turn helps the company in effectively implementing the
policies and strategies that are framed for profit maximization as there is proper monitoring done
by the company as these policies are implemented. So that organisational goals are achieved
without leading towards any deviations. But on the other hand, with the inculcartion of vertical

structure in the organisation there are chances that the relations between employees are hindered
that may create confusions among the departments and may deviate the company from achieving
its goals and objectives.
Organisation structure contribute in deciding the actual task, roles and responsibilities
that need to be completed by each and every individual within the firm so that the desired
objectives can be achieved in effective manner. Likewise, the Google is an American
multinational technology company that is specialised in internet related services and products
such as online advertisement, search engine and hard and cloud computing. The company has
made use of cross functional or team based organisational structure that is having three main
characteristics such as project based, function based and flatness structure which is being used to
promote smooth operation of business in external environment (Lestari and Juwana, 2021). It is
structure that include diverse range of talented and responsibilities that has been separated into
different departments, team in tradition. This structure is being mostly used in order to reduce the
overhead, politics that are happening within the company so that diverse range of employees can
be motivated to work in team for achievement of end goals.
The system approach has been used by the Google in which each system is composed of
set of inter- related and mutually dependent sub- systems. Company have consisted of
components, linking process and goals that helps in smooth completion of each task and
activities for achievement of the desired objectives of firm. In Google, the structure or manner in
which task need to be completed is break down from complex to simpler that has helped in
smooth operation of firm in international market (Tangvald and Wallhoff, 2019). Systematic
procedure and policies have contributed in reducing overall confusion and conflict related to the
manner in which specific task will be completed by particular individuals in the firm. It has yield
in reducing the wastage of time, resources and efforts to complete the task and helps in
delivering qualitative services to customers in limited time frame.
Use of system approach by Google have good impact on the associated stakeholders
such as employees, customers, suppliers and investors and other individuals. So they need to be
informed about the system, policies and procedure that need to be abided by each and individuals
while completing the task. It helps customers in getting the services in standard time and quality
without much issue and complication. Investors also get maximum return because of good
operation of organisation in external environment (No and Lu, 2021). Along with this,

employees are also satisfied to be part of firm such as Google because it has standard procedure
of working that helps in reducing pressure and effective completion of desired task.
On the other hand, Uber focus on making use of contingency theory that helps in
effectively resolving the conflict that are happening between the employees that are working
within the organisation. Uber through making use of contingency theory in its organisation
structure has planned to effectively change its set of operational, set and action as per external
environment that has helped company in growing and sustaining business for longer time frame.
Because of consistent or ever-changing nature, employees of Uber are resisting as it lead in
increasing pressure on them to perform a adapt as per circumstances (Fenwick, 2021). Thus, they
have to learn new and new method that could be used to perform the specific task. This strategy
helps in making stakeholders happy such as customers, employees and other as they want to be
part of firm that is more innovative and creative.
Human relationship theory has been applied by Facebook as it also has matrix structure in
which diverse range of people are working together for achievement of end goals. Company
have designed organisation structure, on the basis people that are employed in the firm, such as
their actual behaviour and attitude has been considered while selecting and recruiting them
within the organisation for desired position. It has helped in delegating the right task to right
individuals at right time thus lead in maximum engagement and reducing employee’s turnover.
Along with it, firm focus on building strong relationship between the employees so that they are
motivated to work in team rather than working as individuals for growth and expansion of firm
in external environment (Singh, Charan and Chattopadhyay, 2020). Making use of Human
relationship theory by Facebook lead in increasing employees’ productivity and performance so
that qualitative services can be delivered to customers.
In addition to this, tradition theory has also been used by firm in which formal structure
has been followed by the organisation and each individual is being given specialised task to
complete for better outcome. Task are divided on the basis of the person who excel in particular
skills and capabilities so that it can be completed better then expectancy of the customer. Formal
structure has contributed in reducing confusion related to role and responsibilities that need to be
completed by each and every individual (Bhanushali, 2018). Likewise, each employees need to
report to its superior about the actual performance or task that they have completed during
specific time frame so that necessary action can be taken to complete the error.

Therefore, use of different organisation theories by contemporary firms such as
Facebook, Google and Uber have helped in coordinating diverse range of people to work for
achievement of common goals.
Thus, it would be right to state that the with the aspect of following of the type of the
organization structure the company will be impacted along with its stakeholders. This can be
made clear with the example of the Facebook, google and Uber which follow varied structure
and as per the structure the company would be impacted along with impacting its concerned
stakeholders in positive and negative manner.
From the above essay it can be concluded that the adoption and implementation of the
concerned organization structure will lead to play an important role in terms of its working and
meeting of changes of the external environment. in the same way it is also understood that with
the following of the concerned organizational structure the working and the goal of the company
would be directly impacted in terms of meeting the goals and the stakeholders need. Further
more it can be concluded there are different organisational structure that are used by different
organisation that help in increasing their efficiency in particular ways.

REFERENCES
Books and journals
Joseph, J. and Gaba, V., 2020. Organizational structure, information processing, and decision-
making: a retrospective and road map for research. Academy of Management
Annals. 14(1). pp.267-302.
Dedahanov, A.T., Rhee, C. and Yoon, J., 2017. Organizational structure and innovation
performance. Career Development International.
Winnubst, J., 2018. Organizational structure, social support, and burnout. In Professional
burnout: Recent developments in theory and research (pp. 151-162). CRC Press.
Kanter, R.M., 2019. The future of bureaucracy and hierarchy in organizational theory: a report
from the field (pp. 63-93). Routledge.
Pérez-Lara, and et.al., 2020. Vertical and horizontal integration systems in Industry
4.0. Wireless Networks. 26(7). pp.4767-4775.
Bundy, J., Vogel, R.M. and Zachary, M.A., 2018. Organization–stakeholder fit: A dynamic
theory of cooperation, compromise, and conflict between an organization and its
stakeholders. Strategic Management Journal. 39(2). pp.476-501.
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