Management of Environment of Organizations: Case Study Analysis

This report provides a comprehensive analysis of the management environments of Fonterra and Burger King. It begins with an overview of Fonterra, examining its technological, economic, and labor market factors, along with a cultural analysis. The report then delves into Fonterra's organizational culture, including adaptive cultures, and its approach to farming and livestock management. It explores cultural elements like heroes, symbols, stories, ceremonies, and slogans, and how these elements influence employee performance. The report then shifts focus to Burger King, analyzing its mechanistic and centralized structure, and discussing the span of control within the organization. It contrasts the mechanistic structure with organic structures and centralized structures with decentralized structures. The report also addresses issues like sustainability and ethical considerations, including bribery and unethical advertising campaigns. The analysis highlights the advantages and disadvantages of different organizational structures and the importance of adapting to the business environment.

Running head: MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
Name of the Student
Name of the University
Author Note

1MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
Answer 1
Fonterra is a multinational dairy co-operative that has its origin in New Zealand and
the stakeholders of the company consist of 10,500 farmers of the country.
Technological analysis
The changes that have occurred in the technologies related to dairy farming in New
Zealand have affected the operations and sales of Fonterra. The use of technology has
enabled the customers in the modern environment to verify the details related to the products
of the company. The production process of the organization also includes the application of
ultra-filtration technology which can reduce the dependency on the imported lactose. The
technologies related faster traceability of issues helps in solving the problems easily
(Wheelen et al., 2017).
Economic analysis of Fonterra
The economy of New Zealand is hugely affected by the dairy industry. The dairy
products manufactured in New Zealand are exported mainly to China and this business has a
major impact on the economy of the country. The export and supply of milk in New Zealand
is affected by Fonterra as it a dairy co-operative which is multi-national in nature. The
increase in price of milk products in New Zealand helped the company in adding more $1
billion in the economy. The rates of milk production are dropping recently due to the increase
in global warming. The drop in production of dairy products has an adverse effect on the
New Zealand economy (Navarro-García, Arenas-Gaitán & Rondán-Cataluña, 2014).

2MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
Labour market analysis of New Zealand
The major problem that has been faced by Fonterra in New Zealand is related to the
drop in the number of recruitments. The youth of the country are not willing to make their
career as farmers and this leads to the lack of their interest in the company.
Cultural analysis of New Zealand
The television advertisements designed by Fonterra had to face many cultural issues.
The company had to face criticism from the social media regarding the All Blacks
advertisement. The tagline of the campaign was “Fresh Start with Dairy” and it included the
brand ambassador of the company and All Blacks captain Richie McCraw. The main focus of
the strategies formulated by the company was the cultural values followed in New Zealand.
The natives and the farmers are the major stakeholders of Fonterra (De Massis et al., 2015).
Answer 2 (a)
The organization follows a culture that is adaptive and it includes the stakeholders and
the employees in various management related decisions taken by the company. Adaptive
culture can be defined as the way by which the company operates when frequent change are
anticipated and the operations company tries to adjust its operations with respect to the
changes. The most prevalent issue in Fonterra for many years has been safety related to food.
The adaptive culture helps in solving this issue of the company, by taking actions as soon as a
problem is identified in the supply chain. The involvement type culture of the company
decreases the chance of the errors within the operations of Fonterra (Jaussi, 2017).
Answer 2 (b)
The main issues of farming and management of livestock is related to the ways by
which the animals are managed and fed properly. This will help them in staying healthy and

3MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
this in turn will be profitable for the company. Fonterra assists the farmers in managing these
and increasing the revenues of the company. Fonterra thereby aims to promote the agriculture
that is conducted based on sustainability of environment. The innovative nature of the
farmers who are the stakeholders of the company help them in the implementation of new
methods in farming (Scott & Davis, 2015).
Answer 2 (c)
Heroes are defined as those people who are treated as role models or prototypes
related to any particular culture. The culture can be related to an organization or the country
where it operates.
Symbols can be utilised by a culture so that the status of that culture can be defined.
The symbols related to status can be used for the purpose of providing signals to the other
organizations regarding the type of behaviour they should depict.
Stories are used by the organizations like learning devices and the organizational
culture can be transmitted with the use of this equipment (Inyang & Egor, 2017).
Ceremonies are related to the events or the programs that are organized by an
organization with respect to some specific culture.
Slogans can be defined as the phrases or sentences that can be used to describe the
corporate value or the culture of the company in an appropriate manner.
Answer 2 (d)
The performance of the employees is affected by the culture that is followed in the
organization or the area where it operates. The culture related to a particular company
includes, values, morals and attitudes which are showed by the workers. The adaptive type of

4MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
culture followed by Fonterra also influences the methods by which employees deliver their
services to the company. The principles related to the culture of Fonterra motivate the
farmers and stakeholders so that they participate in the process of decision-making. The
principles of the organization can also allow the farmers to work as a team and attain the
targets (Alvesson & Sveningsson, 2015).
Answer 3 (a)
Mechanistic structure of the company is related to the high grades of formalization,
complexity and centralization. The companies having mechanistic structure are oriented in a
vertical manner as the number of hierarchies are more.
The organic structure of an organization is related to the flexible nature it depicts and
the various elements related to this type of structure can be semi-permanent and temporary as
well. This structure is flat and the organization can also adapt to the various changing needs
of the environment (Bortolotti, Boscari & Danese, 2015).
Burger King depicts a mechanistic structure related to the organization and employee
of the organization is also quite efficient. The staff who are a part of the different levels of the
hierarchy of the organization work quite hard so that proper functioning of Burger King can
be enabled.
Answer 3(b)
The companies which depict the centralized structure consist a hierarchy of the
decision-making where all decisions and processes are taken care by the highest level of
management. Decentralized structure of the organizations on the other hand tends to involve
many people in the process of decision-making that is related to the operations of a business.
Centralized type of organizations depend on the high level management for the important

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decisions and the organizations with decentralized structures depend on the various teams
that are formed in the company (O'Neill, Beauvais & Scholl, 2016).
Burger King had a decentralised structure of the management, which was changed in
the year 2001. This change had brought many developments in the revenues and profits of the
company. The decisions related to the functioning of the company are taken by the top
management.
Answer 3 (c)
The organizations which follow hierarchical structure are mainly related to the flow of
power in an organization upwards in a vertical manner. The employees of the company are
divided into departments or groups on the basis of their skills. The employees belonging to
this structure need have knowledge regarding their roles and responsibilities in the company.
The companies that have formed hierarchies have many regulations that need to be
maintained by employees (Ashkenas et al., 2015). Burger King has a structure which consists
of many levels and the different types of employees are divided into different groups. The
various departments of the company include, departments like, marketing, finance, sales and
restaurant executives.
Answer 3 (d)
The number of subordinates and employees working under a single supervisor or
manager is defined by the span of control. The structure that is depicted by Burger King is
centralised and mechanistic in nature and the span of control that is created with respect to
the organization is narrow. The organizational hierarchy of Burger King mainly shows that
span of control related to the supervisors is narrow. The reason behind narrow span of control
is division of the company into many departments (Van der Voet, 2014).

6MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
Answer 4 (a)
The proper functioning of Burger King as a fast food chain all over the world is
facilitated by the hierarchical structure. Different levels of leadership are formed in the
hierarchy of the company. the promotional opportunities for the employees will also increase
and this will further help in the increase of motivation. Centralised type of management is
important in a fast food chain as many individuals are involved and confusion can also be
caused within the organizational processes (Alexiou, Khanagha & Schippers, 2018).
Answer 4 (b)
The major disadvantage related to the mechanistic structure of Burger King is related
to the decrease in innovation levels. The satisfaction levels of employees will be low and
turnover of employees can increase in the process. The implementation of organic structure
can bring innovation in processes related to production.
Answer 4 (c)
The amount of staffs who work under or report to a supervisor or manager is referred
to as the span of control. The width of the company is depicted with the help of the span of
control of the supervisor or manager. The amount of time which is taken to take a decision
can be influenced by the span of control. The span of control of Burger King is narrow in
nature and this has major importance in the supervision of the staffs in the different
geographical areas related to the organization (Naumann, Jackson & Tax, 2015). The increase
in the width of the span of control can have negative effects on the performance of managers.
Answer 4 (d)
Centralised organizational structure has advantages which include the setting of
perfect objectives and goals. In the decentralised establishments the knowledge of staffs is

7MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
used for different operations. The drawback of centralised organization are the multiple
hierarchical levels and that decentralised organization is the time taken for making decisions.
The centralised structure of Burger King will therefore enable faster decision-making.
Answer 5
One of the major issues for the organizations with respect to the modern business
environment is sustainability. Burger King is a fast food chain which has its operations in
many different countries and has faced many issues related to sustainability. Burger King has
been lagging behind many other companies related to steps taken for sustainability. The huge
purchase of raw materials from non-sustainable resources is the major issue. The company is
however trying to increase its purchase of raw materials from sources which are sustainable
in nature (Want Richie McCaw to land at your local primary school?, 2018).
Answer 6 (a)
The issue related to the payments made to the government officials or providing them
with bribes is unethical in nature. These steps are taken by the companies so that they can
take out internal information related to the other companies. The information is mainly based
on the contracts related to the companies and information about the organizational operations.
Bribery is a moral issue and the companies which practice this can face severe punishments
(Taras, Steel & Kirkman, 2016).
Answer 6 (b)
The most important ethical issue that has been faced by Burger King in the recent
time is the advertisement which was named, “Burger King’s Super Seven Incher – It’ll Blow
your mind away”. This advertisement was aired by Burger King in the year 2009 for the new
product that were about to launch namely, “Super Seven Incher”. The vulgarity of the

8MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
advertisements and its linkage with sexual connotations was the major unethical part of the
entire campaign. This advertisement of the company was heavily criticised by the media and
other forums as well. The degradation of women caused by this advertisement was another
major unethical part of the campaign. This advertisement was then removed by the company,
however they did not apologise for the content of the advertisement (BURGER KING®,
2018). They released a statement stating that they value and respect all the guests.
The two viewpoints that are suitable for the ethical decision taken by Burger King are,
the Individual view and the moral rights view. The individual view is related to the
independence of the company with respect to the independence that an individual has related
to making the choices for their own selves (Alexiou, Khanagha & Schippers, 2018). The
company had taken the decision to air this ad for their own profit and then they released
statements and removed the ad to save their image. The moral rights view is related to the
rights that the female customers of Burger King have related to their moral rights which have
been degraded by the company. The moral rights of the customers are protected by the
company by removing the ad.

9MANAGEMENT OF ENVIRONMENT OF ORGANIZATIONS
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