Analysis of Nu Skin's Organizational Culture and Business Structure

This report provides a comprehensive analysis of Nu Skin Enterprises, exploring the intricate relationship between its organizational culture, business structure, and overall company performance. It begins by outlining the company's background, including its founding and core business operations in the personal care and supplement industries, as well as its multilevel marketing approach. The report then delves into the impact of organizational structure, such as functional structure, on company culture and employee performance, emphasizing the importance of management practices, employee motivation, and fair compensation. It further examines the contributions of positive culture to employee retention and business growth, referencing the Charles Handy model and its cultural types (power, role, task, and person) to explain how Nu Skin's structure influences its culture. Additionally, the report analyzes Nu Skin through the lens of Hofstede's cultural dimensions, including power distance, individualism versus collectivism, masculinity versus femininity, uncertainty avoidance, and long-term orientation, to provide a deeper understanding of its organizational dynamics. The report concludes by summarizing the interconnectedness of culture, structure, employee performance, and business outcomes, emphasizing the importance of a positive and supportive work environment for Nu Skin's continued success.

Structure and culture of
the Nu Skin

Table of Contents
INTRODUCTION...........................................................................................................................1
Relationship between culture, structure, people and company performance...............................1
Contribution of structure and culture to company performance..................................................2
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Culture and structure of company reflects work ethics, mentality and values of business
owners and workers. With the help of friendly culture with staff members' organization can be
able to encourage peoples creativity which is beneficial for overall business and its operations
(Ahsan, 2015). The present report is based on Nu skin enterprises which is located in Provo,
Utah and successfully managed their bulk's of operations. This study explains the culture and
structure of company and define how these elements contribute to company performance.
Furthermore, it justifies relevant models and theories of organizational culture and design.
Overview of company-
Nu Skin is an American multinational or multilevel marketing organization that sells and
develops personal care products, dietetic supplements under their Pharmanex brands and NU
skin brands. It is founded by Blake Roney, Sandie Tilloston, Steve Lund and Nedra Roney in
1984 in Utah. Company start their first foreign operations in Canada and originated in US, after
the success of first operation they began its second operations in Asia. Under Pharmanex Brand
and Nu Skin organization sells and manufacture than 200 personal care goods marketed as
supporting people feel and look younger.
Relationship between culture, structure, people and company performance
Organization structure identifies how roles, responsibilities and power is controlled,
assigned and coordinated and how essential information flows between the various levels of
management. Company structure is depends on the business strategy and objectives and also
interrelated with peoples, culture as well as firm performance. Firm culture in extent way defines
organizational structure of company but structure also partially defines culture of the company. It
can be said that structure is the framework for company culture to be implementation while it
dictates how business must be structured (Amelec, 2015). If the NU culture is positive and all the
workers will work together it effects on company performance as well as all the staff members.
There is clear relationship between culture, structure and workers in Nu Skin here are
some examples showing this: When Nu Skin enterprises use Functional structure in business
which includes undertakings like direction, allocation, supervision and management
responsibilities it effects on organizational culture. According to this structure each of the
management play role effectively and use their power for controlling overall business
performance. Management efforts and motivate workers to take participation in decision making
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procedure which build strong relationship between them and build trust. Nu Skin manager give
rewards and pay incentives to peoples equally based on analyses of their performance which
create healthy and positive culture. Chairman and other management officers focus on
employees' motivation and implement new strategies for encouragement in order to increase
workers performance as well as company. If the manager understand employees needs and
requirement at workplace they can be able to retain talented people with them for longer as it is
related to culture and structure of Nu skin (Borodai, 2017). Executive committee, board of
directors, founders and regional presidents is included in company management who have
different roles and responsibilities. Manager communicate with board of director in context of
employees performance and productivity, they consider their efforts for given task as it put
positive influence on staff performance and enhance their working styles. If company pay equal
wages to peoples it contributes to create healthy work culture at workplace which also enhance
productivity and profitability of Nu Skin.
But on the other side if management do not consider staff performance and cannot
provide equal wages to them, it negatively effects on business performance as well as its market
reputation and position. When Nu Skin management misused their power and encourage few
peoples it put effects on other ones and it will bring high employee turn over which is not
beneficial and appropriate for overall business.
Contribution of structure and culture to company performance
Positive culture within Nu Skin depends on its organizational structure in which all the
management level have defined roles and responsibilities. Culture of firm is the integral part of
business it influences closely every aspects of firm. From hiring top talent to improving and
developing workers satisfaction. Without creating the positive corporate culture company cannot
be able to retain talented and skilled people with them as it support to increase profit margin of
firm effectively. Manager considers working environment and make some changes within it as to
improve it better than before in order to sustain for longer and attract new applications. In short
culture of the Nu skin is sum total of common beliefs and attitudes held by its staff based on their
experiences (Bussmann, 2015). If company consider workers needs and fulfil their demands, as it
influence staff behaviour and willingness of everyone to work with firm and contribute in
achieving business goals and objectives. Creating positive culture in company is important to
workers because employees is likely to work and enjoy time in workplace when they fit in with
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organizational culture. It also essential for employers too because staff who fit in with current
culture likely to be more productive and contribute to growth and success of business than
before.
Several models has been proposed in order to explain organization culture one of them
being the Charles Handy Model.
Handy's Model of organizational culture is defined four various types of culture: Role,
Power, Task and Person. With the help of this model it is easy to understand the relationship
between culture and structure of Nu Skin and its contribution to organization performance as
well as progress.
There are four types of culture-
Power culture-
In the company with power culture power is hold by just few peoples whose influence
spreads throughout the firm. In this phase of Handy organizational culture model, there are few
regulations and rules. What peoples with power decide is what happens. Workers are usually
judged by what they achieve more than how they do work or act at workplace (Fiordelisi and
Ricci, 2014). For example, if Nu Skin management judged few employees and appreciate them
it effects on other performance and decrease their working interest. But on the other side when
manager judged staff performance equally and also considered efforts which they put in order to
achieve business goals and objectives, it is beneficial for firm as well as its bulk of operations.
Role culture-
Companies with the role culture of Handy model of organizational culture is based on
rules. It is highly controlled with each of the members in company knowing what their
responsibilities and roles are. Power in this culture is determined by the individual's position in
organizational structure. This cultures are built on detailed organizational structures which is
usually tall just like Nu Skin with long chain of command. In short, in company if manager take
decision via considering all the workers' performance equally it can be beneficial for them as to
hold the position as well as skilled person for longer term period. But on the other side manager
with role culture less focuses on workers' performance and less likely to take risks which effect
on company growth and decrease their profitability rather than before.
Task culture-
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Task culture in Handy Model of organizational culture forms when teams in the company
are formed to address particular progress projects or problems. Task is the essential thing, so
power within group of people will often shift depending on mix of unit members and status of
project or problem (Mellor, Hao and Zhang, 2014). In short, Nu skin staff with task culture can
be able to achieve business goals and objectives while working in team which is beneficial for
business growth and increase their performance effectively. But on the other hand when
employees of company does not perform in group and cannot be able to working in team if
negatively influence on company performance as well as financial performance. With right mix
of skills, leadership and personalities working in teams will be incredibly creative and productive
and useful for overall business.
Person culture-
This culture is often be found in professional companies where workers have complete
independence and highly educated and capable to work with their own expertise. In Nu Skin
employees with person culture very much see itself superior and different to company. If
workers work independently as according to person culture and handle all of their work itself
they can be able to create positive environment around workplace and he/she is responsible for
all the benefits. But on the other side when any issue get arise in project and only one person will
handle it without any help it effects on their working abilities as well as company performance.
Disadvantage of person culture is that employees must handle risk associated with project
individually and accountable to every risk factors that influence on its performance and Nu Skin
market position.
Hofstede Cultural Dimensions theory-
Hofstede cultural dimensions model is divided into 5 dimensions that define different
types of cultures.
Power distance-
Power distance is willingness of the culture to accept power and status differences among
company staff members. In Nu Skin organizational culture with low power distance, employees
likely to expect that power is distributed more than equally (Geert Hofstede’s five dimensions,
2017). Due to low power distance, management and workers can be able to work in a team
effectively and it is beneficial for creating positive culture. But on the other side high power
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distance make negative effect on company culture as well as workers performance in which
management take decision individually without any discussion with its team members.
Individualism versus Collectivism-
Peoples in Nu Skin with individualistic cultures expected to work itself and seek to
accomplish goals individually. They are accountable for all the aspected of risks and benefits and
managed themselves (Mueller, 2014). If any risk began while doing work on project, individual
person cannot be able to handle it which effect its performance as well as business. But on the
other side when peoples work together according to collectivism cultures it can be possible for
them as to achieve Nu Skin enterprises goals and objectives successfully.
Masculinity versus Femininity-
In Nu Skin enterprises if company only focuses on male candidates and provide the best
opportunities to them it shows masculinity cultures in which management less concentrating on
female applicants that put negative influence on firm performance. But on the other side against
masculinity cultures, when organization adopt femininity culture in order to provide equal pay
wages and career growth opportunities to female they can be able to sustain within marketplace
for longer.
Uncertainty Avoidance-
This dimension evaluate extent to which workers feel threatened by ambiguous
situations. When Nu Skin workers working in cultures with the high degree of uncertainty
avoidance, is likely to feel uncomfortable in workplace and ambiguous situations. High degree of
uncertainty avoidance culture in firm make effect on business performance, peoples with this
culture less responsible for any certain risks because of lack of policies and rules. But on the
other hand low degree of uncertainty avoidance, peoples live in thrive culture where they are
accountable for any risks happen while working in a group or individual.
Long vs short term Orientation-
Longer term orientation is 5 dimensions of Hofstede's cultural dimensions theory which
is added original four dimensions. When company take time to achieve their goals and also take
longer term period for raising profitability, employees likely to work with them and wishes to
build long relationship with them. But on the other side if organization make short term business
plan and set low time frame to reach the goals, workers are less interest while working with
them.
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CONCLUSION
From above it has been concluded that culture, structure, employees and organization
performance is interrelated with each other. Positive culture of Nu Skin helps to enhance workers
performance that result in increase profitability and productivity. It has been summarized that
Handy's Model of organizational culture and Hofsede cultural dimensions theory phases define
various organization culture that effect on firm might be positively or negatively. With the help
of collectivism cultures peoples are able to performance effectively and increase profitability of
business rather than with individualism cultures. Furthermore, culture of company is based on
which culture they adopt in its business structure that effect upon staff members' performance.
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REFERENCES
Books and Journals
Ahsan, S.R., 2015. Corporate culture and organizational change-a study on a large
pharmaceutical company in Bangladesh. Asian Business Review. 4(2). pp.29-37.
Amelec, V., 2015. Improvements in the Supply Chain of an Automotive Company Through the
Implementation of Continuous Flow. Advanced Science Letters. 21(5). pp.1416-1418.
Borodai, V., 2017. Brand of the employer as DNA of corporate culture of service
company. European Research. (1). pp.34-35.
Bussmann, K.D., 2015. The impact of personality and company culture on company anti-
corruption programmes. The Routledge handbook of white-collar and corporate crime
in Europe. pp.435-452.
Fiordelisi, F. and Ricci, O., 2014. Corporate culture and CEO turnover. Journal of Corporate
Finance. 28. pp.66-82.
Mellor, S., Hao, L. and Zhang, D., 2014. Additive manufacturing: A framework for
implementation. International Journal of Production Economics. 149. pp.194-201.
Mueller, J., 2014. A specific knowledge culture: Cultural antecedents for knowledge sharing
between project teams. European Management Journal. 32(2). pp.190-202.
Ridley-Duff, R., 2018. The internationalisation of FairShares model: where agency meets
structure in US and UK company law.
Szczepańska-Woszczyna, K., 2014. The importance of organizational culture for innovation in
the company. In Forum Scientiae Oeconomia (Vol. 2, No. 3, pp. 27-39).
Traphagan, J., 2015. Why “Company Culture” Is a Misleading Term. Harvard Business Review.
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Walker, B. and Soule, S.A., 2017. Changing company culture requires a movement, not a
mandate. Harvard Business Review. pp.2-6.
Online
Geert Hofstede’s five dimensions. 2017. [Online]. Available
through:<https://relivingmbadays.wordpress.com/2012/12/30/geert-hofstedes-five-
dimensions-of-national-culture/>
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