Shell's Organizational Structure, Culture, and Performance Analysis

This report delves into the organizational structure and culture of Shell, a major oil and gas company. It examines how Shell's tall and matrix structures, influenced by Max Weber's Bureaucratic Theory, facilitate its operations across various countries and business areas. The report also analyzes Shell's organizational culture, referencing Handy's Model to understand how the company fosters employee motivation and performance through role and task-oriented approaches. The analysis covers the allocation of roles and responsibilities, communication channels, and the impact of these factors on the company's overall success, including its strategic implementation and ability to adapt to its environment. The report concludes by highlighting the importance of aligning organizational structure and culture to achieve consistent business performance and employee engagement.

Introducing Modern
Place

Table of Contents
INTRODUCTION...........................................................................................................................3
Main Body.......................................................................................................................................3
CONCLUSION ...............................................................................................................................6
REFERENCES................................................................................................................................1
.........................................................................................................................................................1

INTRODUCTION
Organisational structure are related with various rules, regulations, policies which are
adopted by the company with the aim of achieving the goals and objective. While culture of the
organisation refers to the values, attitude and behaviour of the employees working in the
organisation. The success of the organisation depends upon both of these factors. In this report
the organisational structure and culture of Shell company is being discussed which contributes to
their performance. In this report various theories and models of the organisational design and
culture are also discussed.
Main Body
Royal Dutch Shell PLC, also known as Shell is a oil and gas company which is
incorporated in UK but headquartered in Netherlands. Shell is ninth largest company throughout
the world by revenue while in Europe it is largest oil and gas company. The scope of work of
Shell is large as they are active in all areas of oil and gas that includes exploration, refining,
marketing and distribution etc. The company is also engaged in various activities related to
renewable energy which includes biofuels, energy-kite system etc. The company has their
operations in more than 70 countries (Elsmore, 2017).
The organisational structure is concerned with the hierarchy in which the roles and
responsibilities are allocated to the people as per their capabilities. Shell is a multinational
company that has been operating in various countries due to which they follows the tall structure.
Tall structure is then further divided into various divisions, departmental heads and service
heads. In a tall structure there are supervisors who handles the activities as they have the
authority to do so. The organisational structure of Shell is complex as they have wide network of
outlets so further they follows matrix structure as they are large organisation. In this the
employees are grouped as per specific function or product or both. With the help of the structure
of the organisation the relationship, authority and responsibility, channel of communication can
be easily and clearly defined which develop understanding among the people working in the
organisation. This make them consistent towards their goals and objectives with which the
companies can easily diversify their business. Also this facilitates implementation of the policies
and strategies effective. While designing the structure of the organisation various factors that are

considered by the Shell includes the environment in which they are operating, the technology
which have been using, the strategies they have adopted and the size of the organisation.
Various models of organisational designs need to be considered by the organisation
which helps them to align their structure with their objectives. The model which is used by the
Shell while designing the organisation structure is Bureaucratic Theory by Max Weber
(Miśkiewicz, 2017). He defined bureaucracy as highly structured, formal and impersonal
organisation. Further he instituted the belief that the organisations must have the hierarchical
structure, clear rules and regulations, a line of authority which makes governing easy. The model
provides six bureaucracy characteristics such as task specialisation, hierarchical of authority,
formal selection, rules and requirements, impersonality and career orientation. In task
specialisation, the task are divided into small activities which are to be undertaken by the
employees as per their competencies and specialisation. This helps the organisation to bring
efficiency in their operations as the employees will perform as per their capabilities. Further it
will benefit the supervisors in managing the activities and the performance as they can
effectively analyse the employees performance. In hierarchical of authority, the managers are
organised into various layers who are held responsible for the performance of the people. This
suggests that various layers are to be made in which the highest layer has the greatest power
while the bottom layer has the powers to supervise and control. It will facilitate the people in
delegating the powers and in effective communication. In formal selection the management
selects the employees as per their skills, competencies and capabilities. On the basis of which
their pay, responsibilities are determined. In rules and requirement, various rules are formulated
which help the employees to be consistent towards their goals and objectives. Further in this
various administrative roles and their responsibilities are defined (Laforet, 2016). Also the
requirement of the new rules is identified and introduced. Impersonal characteristic of the theory
defines that the impersonal relations are developed among the employees due to which the
involvement of outsiders are prevented. Such relationships are governed by the system of official
rules and regulations which keep the sentiments, emotions and involvement away from official
positions. In career orientation, the employees are selected by the management on the basis of
their expertise which make the organisation efficient in employing right candidate at the right
position. The allocation of the task as per the capability of the employees make them expert in

that particular field which offers them career opportunity to get the lifetime opportunity
(Charman, 2017).
With the help of this model of organisational design the Shell efficiently develop the
structure of the organisation as with this they can determine the layers in which they can make
their people responsible. Also with the help of which they can improve the performance of the
employees as well as that of the organisation as they are allotted various responsibilities on the
basis of their capabilities and competence. Shell is a large organisation in which the model of
bureaucracy is beneficial as it institute various layers which helps them to work effectively. With
the help of this model they can establish various rule and procedure that can bring efficiency in
consistent execution of work.
The organisational culture refers to the shared vision, beliefs, values of the people
working in the organisation. The culture has greater influence on the employees as the
employees behaves in the manner as other do, the way the interact etc. The organisational culture
of the organisation includes the experiences, expectations, philosophy of the individual. It helps
the management of the Shell in defining the way in the which the employees need to behave
within the workplace. The leaders of the company plays a crucial role in managing and
maintaining the culture. While managing the culture, the Shell consider the Handy's Model of
organisational culture (Bryan-Kjær, 2017). The model suggests that four types of culture are
their out of which the company can select the one which suits to their organisation. It includes
power, task culture, person culture and role culture. In power culture, the power in the
organisation rest with few people who has the authority to take all the decisions. The authority
are further allocated to others by them as per the capabilities. In such culture the subordinates has
to follow the instructions so provided by the superiors. In task culture, teams are formulated who
has been given various targets which has to be achieved by them. In such teams the people who
has common interest and specialisation are grouped into one team in which they have to
contribute equally to the target and to solve the issues faced by the company. In person culture,
the employees feels themselves more important than the organisation. This culture make the
organisation suffer from various issues such as delay in achieving the targets, loss of business as
due to delays the customers may not prefers to opt the services of the organisation. In role
culture, the employees in the organisation are provided various roles and responsibilities on the
basis of their capabilities and competence. All the employees are help responsible and

accountable for their conduct which make them conscious towards the way the perform. Such
culture motivates the employees to perform better as they willingly accepts the task that they
have to perform (Rothaermel, 2017).
The role culture and task culture is predominantly adopted by the Shell as this makes
their employees feel motivated and thus improves their performance. The organisation culture at
the workplace brings unity among the people which compel them to perform better, create sense
of direction and develop understanding with the help of which implementation of various
strategies and changes is possible. For creating a comfortable and developing working
environment, core values, beliefs and the vision of the employees need to be considered. This
make the employees of Shell feels motivated and thus they will perform consistently towards the
goals of the organisation. Also it will define the internal and external identity of the company
which will further help Shell to improve their overall organisational performance.
CONCLUSION
It is concluded from the above report that the organisations considers the structure and
the culture of the organisation as it helps them to improve overall performance of the company.
With the help of structure of the organisation the roles and responsibilities are delegated to the
people as per their capabilities and competence. While the culture of the organisation motivates
the people to work efficiently as it develops the understanding and bring unity with the help of
which they met up with the issues efficiently and help in improving the overall performances.

REFERENCES
Books and Journals
Bryan-Kjær, K., 2017. Sustainability in the hierarchy: how corporate sustainability is anchored in
the organisational structure. International Journal of Corporate Strategy and Social
Responsibility. 1(2). pp.179-192.
Charman, S., 2017. Organisational Culture and the Policing Organisation. In Police
Socialisation, Identity and Culture (pp. 13-38). Palgrave Macmillan, Cham.
Elsmore, P., 2017. Organisational Culture: Organisational Change?: Organisational Change?.
Routledge.
Laforet, S., 2016. Effects of organisational culture on organisational innovation performance in
family firms. Journal of Small Business and Enterprise Development. 23(2). pp.379-
407.
Miśkiewicz, R., 2017. Organisational structure in the process of integration on the example of
iron and steel industry enterprises in Poland. Difin.
Rothaermel, F.T., 2017. Strategic management. New York, NY: McGraw-Hill Education.
1