Organizational Effectiveness within Shopify: A Team Project Analysis

This project, prepared for the MSMG 5120 Organizational Effectiveness course at Trent University, analyzes the e-commerce company Shopify. The project focuses on five key areas for organizational effectiveness: developing diversity and equity, exploring technology innovation and integration, addressing issues of stress and well-being, cultivating a positive organizational culture, and developing an effective communication framework. The analysis examines Shopify's strengths and weaknesses in each area, providing insights into diversity challenges, technological advancements, employee stress factors, cultural practices, and communication strategies. The project highlights the importance of diversity, the need for technological improvements, the impact of stress on employees, the role of organizational culture, and the significance of a strong communication framework in fostering a successful and effective organization.

SCHOOL OF GRADUATE STUDIES TRENT UNIVERSITY
MSMG 5120 – Organizational Effectiveness 2021 Winter Term
Team Project: Organizational Effectiveness within "Shopify”
“We clarify that this work has been prepared as a result of my own effort. We have not
submitted this work for grading any other course”
Prepared By:
1. Rubaiat Abde Rabby
Student ID: #0697263
2. Pritom Charls Gomez
Student ID: #0708842
Submission Date: 22/04/2021

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 About Shopify:
Shopify is a Canada-based multinational e-commerce company that provides support for its
customer to start their business. It was founded back in 2004 by Tobias Lütke, Daniel Weinand, and
Scott Lake after they attempted to open an online store for snowboarding equipment name
Snowdevil. However, after they were dissatisfied with the existing complicated and expensive e-
commerce options, the owners of Snowdevil launched Shopify in June 2006, headquartered in
Ottawa, Ontario. According to Carney (2020), Shopify is a dedicated eCommerce website builder
and it helps people build their very own online store”. Shopify helps people to create their shop by
handling everything from marketing and payments to checkout and shipping. Wikipedia (2021)
reported that Shopify has more than 1,000,000 businesses currently in about 175 countries as of
January 2021, but according to Builtwith (2021), more than 3.6 million online stores run on Shopify
and they have more than 5000 staffs working. According to Singleton (2021), over $200 Bn has
been generated by businesses using the Shopify platform. With more than 58 million visits in 2020,
the average Shopify conversion rate is 1.6%. Also, its partnership with TikTok has opened the door
for over 1 million sellers (WebsiteBuilder, 2021). As of July 2019, Shopify’s net worth is $6.17
billion (Csiszar, 2020). Based on our research we are focusing on 5 sectors where Shopify excels
and has room for improvements to become one of the best e-commerce platforms.
1. Developing diversity and equity within the host organization:
Diversity refers to the differences that the individuals of the organization have among themselves
(Dyson, n.d.). According to Nelson (2020) equity refers to the contribution (Time, Creativity, and
Experience) that all the employees input to the company and receive equal outcomes (Pay, Award
and Benefits) in return. Nelson (2020) stated that diversity is surrounded by a lot of variations
among the employees, including culture, gender, age, ability, religion, personality, social status, and
sexual orientation. According to Nelson (2020), Cultural differences contribute a great deal to the
diversity of the workforce, but other forms of diversity are important as well. Nelson (2020) also
stated that organizations need to be open to hiring individuals from many different countries so that
the organizations become as diverse as the communities in which they operate. Dhillon (2018)
indicated that diverse people inside the company increase the innovation and creativity of the
company.
Shopify believes that effective organizational culture can be created by involving a diversity of
people in work. Nelson (2020) said that by the year 2020, the workforce will be more culturally
diverse, more female, and older than ever. However, Shopify has been criticized for its lack of

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diversity based on gender and racial differences. Firstly, it’s been seen that Shopify used to give
more priority to White and Male people. Male people and people with white skin tone get more
facilities and benefits than female and black people. According to Voidonicolas (2021), Shopify’s
small business loan applications which are submitted by women are found frequently rejected. It is
almost 31% less than the man-owned businesses. Secondly, Voidonicolas (2021) also said that
Black and Latin founders represented just 2.6% of the total $87.3 billion in venture capital funding
and this statistic is more horrible for the black women as they represent only 0.64% of the total
capital funding. However, in percentage terms, women now hold 9.44% of these important jobs
compared to 9.02% a year ago in Canada (Nelson 2020).
It has been said whatever gets the team’s focus, does get more time and attention (Nelson, 2020).
Nelson (2020) also stated that managers who need to motivate diverse workgroups must
communicate with employees who have different values and language skills. By measuring the
organization’s diversity and looking at it objectively, it helps to improve the overall diversity levels
by putting more focus on the actions required to improve them (Miller, 2016).
2. Possible areas for technology innovation and technology integration:
Using the latest innovations in eCommerce can become the key difference between the company
and rivals; also, it helps to increase the brand value of the company. Having an eCommerce
platform can help us to experiment, adapt and implement new technology. Shopify is Canada’s one
of the most technologically advanced companies. Shopify uses 79 technology products and services
including HTML5, Google Analytics, and jQuery (Crunchbase, 2021). Shopify is actively using 143
technologies for its website and these include Viewport Meta, IPhone /Mobile Compatible, and
Apple Mobile Web Clips Icon (Builtwith, 2021). However, there are areas where Shopify is lacking
behind and can use more technological advancements to improve its services.
Shopify can add more technological advancements to their app to improve their
service. Firstly they can work over their payment system. According to Shackleton (2017), Apple
Pay will give customers a seamless, speedy checkout experience that makes buying from your store
a joy, and in the case of Shopify, they have Apple pay in all their stores. However, not all customers
are comfortable with Apple Services and they prefer to use other payment options. Although
Shopify has a very convenient checkout system unless someone uses Shopify Payment Service, they
have to pay Shopify's enforced transaction fee (Carney, 2021). Secondly, they have a lack of
control over their checkout process. According to Rogers (2019), The Shopify checkout is very
locked down, which again is both a good thing and a bad thing as there are very rarely issues in this

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area, whereas it’s common with other platforms. However, this creates limitations for the retail
customers as not everyone likes unwanted texts and emails. Shopify can improve this by adding
new features through which they can ignore these things. Thirdly, the Shopify app is not capable of
pushing changes across the stores; a lot of things (App Management, Promotion Management) are
still manually operated and very time-consuming (Rogers, 2019). Also when the customers try to
use the Shopify platform to create their online store and try to use different themes, the content
doesn’t automatically reformat. The customers need to provide all the information again (Carney,
April 07, 2021). Shopify should add more technological integration to solve these issues so that the
customers find the app more convenient and time-saving.
3. Addressing issues of stress and wellbeing within the organization:
Stress is something that creates an impact on an individual’s physical and psychological health and
creates physical, mental, and emotional strain in his mind (Nelson, 2020). Workplace stress can
happen for the demand and pressure from both inside and outside the workplace and it threatens an
individual’s well-being (Nelson, 2020). According to Nelson (2020) when an employee is unable to
match his skills and resources (time, equipment, and knowledge) with the demand of the company,
the workplace becomes stressful. According to Hatice (2002), workplace stress is an important issue
for the organization itself because it impacts the financial condition of the company. However not
all stress is negative, stress can also be positive (Nelson 2020). Nelson (2020) stated that “Positive
stress can bring good performance and health benefits”. Kumar (2019) said that “The right amount
of stress can help you be more productive in some cases, and without any stress at all, some tasks
would be hard to focus on”. However, In Shopify, there are a lot of sources of stress for the
employees. According to Shopify Review (2021), there are few sources of stress that employees of
Shopify face in their regular work such as; harsh deadlines, high turnover rate, non-flexible working
hours (overtime without pay).
Firstly, according to Nelson (2020), Fewer people doing the same amount (or more) of work create
time pressure, a leading cause of stress often associated with work overload. In case of improving
the stress created due to harsh deadlines, they can provide more time for the staff or they might
involve more staffs in the work so that the employees don’t feel that they are getting pressurized.
Phillips (2017) said that someone should tell his team to contribute more before he actually needs
them so that the team gets to know the importance of the work and the work will become more
flexible. Secondly, if the employees are stressed due to the high turnover rate, the manager can
make them understand the current situation of the company, be transparent to them, can ask for

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feedback for their experience, and keep the floor open for criticism (Pope, 2019). Pope (2019) also
said that the best way to keep employees from quitting the job is to keep them happy at
work. Thirdly, it has been seen that employees were complaining about their non-flexible working
hours, where they have to work more on regular days without paying and also work on the
weekends on a rotation basis due to work pressure (Shopify Review, 2021). According to Dolman
(2019) employers are required to pay for overtime if overtime is worked and the employee is
eligible. Shopify can use these policies to resolve their overtime issues. They should treat overtime
as an exception, not a regular practice, they can also try to use flexible work schedules to reduce
overtime and they can establish an official overtime policy so that the staff doesn’t get stressed due
to this (Campbell, 2019).
4. Developing a positive organizational culture:
Organizational culture is often described as steady, shared, noticeable patterns of behavior that
differentiate between groups (Nelson, 2020). Shopify has a director of culture, whose prime
responsibility is to be a bridge between management and the rest of the organization (Nelson, 2020).
In her interview with “Ways we work”, Konval Martin; director of culture at Shopify mentioned
that they define culture as a sum of all the individuals associated with Shopify as everyone plays a
major role in impacting the culture. (Matin, 2020)
Firstly, Shopify has a full-fledged cultural team, which is a collaboration of 4 teams with different
responsibilities. The graphics designers work with visuals throughout the office and the office
design itself. The internal communications team which itself has 2 sub-teams, works on delivering
any message while keeping employee’s right, feelings in mind. Lastly, the culture specialists, who
play an exciting role of being the eyes and ears on the ground for the organization, onboard new
hires every two weeks and conduct town hall, work with coaches and leads to find out the areas of
improvement.
Secondly, Shopify developed a positive culture by adapting to “default to open” where they only
put an embargo on sharing things that someone is legally restricted to do so. This helped to grow a
culture where everyone is welcome to share any ideas they come up with, which created more mid-
level leadership within the organization. According to Matin (2020), Shopify loves to conduct
experiments on new and realistic situations to develop better strategies for serving their merchants
(Matin, 2020).
Thirdly, the way Shopify built its culture started with hiring the best people for the position
(Robins, 2014). Shopify is trying to implement an “adaptive culture”, which allows employees to

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take risks by enhancing their confidence (Nelson, 2020). As great minds together do great things,
Shopify also works on employee satisfaction by providing meaning and encouraging positivity.
They do not change their culture of a fun-loving office as they grow big. Rather they embrace a new
and enhanced way of having a diverse organizational culture among them.
5. Developing an effective communication framework for this organization:
Shopify introduced Timeline in 2016, an internal communication tool to providing users
frameworks to link production with sales aspects (Timeline, 2020), which allowed both employees
and merchants to comment, post, share, and edit information, providing a sense of two and multi-
directional communication. There are also drawbacks of digital communication. Consumers are
more likely to buy a product when they have seen it in person (Perizzini, 2021). Yet roughly 3.5
trillion USD was spent on online purchases in 2020. The goal is to improve response time for the
customers, managing multiple customer channels, and improving customer loyalty. It is also hard to
read the expression of the message and hence can be diverted to a completely different context
(Nelson, 2020). Furthermore, messages go unread or ignored, causing a hinder in communication.
Shopify is currently expanding communication through opening physical locations by having a
store in LA. It helps to reach and provide better services to retailers. Face-to-face communication
has the highest information richness (Nelson, 2020). Running side by side with the online platform
to provide the essential commodity to the retailers which cannot be replicated online (Shopify
Physical Store, n.d.). This will enable two-way communication, which is an interactive form of
communication in which there is an exchange of ideas, feelings, or both (Nelson, 2020).
An online framework of communication is still the better path for Shopify, but to have more
physical stores side by side is going to provide Shopify the essence of trust and scope of
development in terms of two-way communication.
 Recommendation:
Diversity Development by Paying More Attention and Motivation: While they are praised for
having a wonderful work culture they are also criticized for lack of diversity, having white and male
preferences. Shopify should focus on having a diverse workforce based on gender and racial
differences, different values and language skills. By paying attention to organizational culture, by
providing proper diversity training, and by providing more facilities for the employees to attract the
broader pool of diverse candidates; diversity and equity can be developed (Miller,2016).
Technological Advancement in Shopify App & Payment System; Over the years Shopify has
grown to be one of the big names in the eCommerce sector and they need to invest more in

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technological advancements in areas such as app management, a lot of things are manually operated
and time-consuming. Also, theme changing doesn’t reformat the store information while creating
the store. They need to add more technological advancement in this sector. After all, the
convenience of the customer can make a huge difference if we consider the scale of business
Redesigning Workplace Environment to Reduce Stress; Workplace stress will always be there in
this challenging business era. But Shopify already has a fully operational cultural team that caters
healthy culture within the organization with a vision to have employee satisfaction and diversified
culture. They should ask for employee feedback, Add more workforce and providing flexible
working hours to improve their workplace stress. Their traditional activities with employees can
help in reducing stress and create bonding, which they should continue to organize even if they
grow much bigger.
Maintaining Healthy Organizational Culture; Shopify is known to have a diverse and fun-loving
office culture. Matin (2020) mentioned in her interview that Shopify had amazing office culture
with strong bonds between employees and management. They had such exponential growth in
recent years, and it became a challenge to maintain that bond. They should re-introduce the
organization-wide games, picnics once the pandemic is subsidized. This initially created a friendly
atmosphere within the organization. As great minds together do great things, Shopify also works on
employee satisfaction by providing meaning and encouraging positivity.
Opening More Physical Stores; Shopify is currently expanding communication through opening
physical locations by having a store in LA. They should think about opening more physical stores,
through which they can engage in face-to-face communication with the retailers. This will serve as
an act of goodwill and trust in Shopify’s integrated online business framework.
 Conclusion:
Over the years Shopify has grown to be one of the big names in the eCommerce sector. While
Shopify is praised for having a wonderful work culture they are also criticized for lack of diversity,
Workplace stress, issues with the app. However, Shopify already has a fully operational cultural
team that caters healthy culture within the organization with a vision to have employee satisfaction
and focusing on creating a diversified culture. They have their traditional activities with employees
that help reducing stress and create bonding, which they should continue to organize, and adding
more technology and diversified workforce can solve their issues of diversity and inconvenience of
the App. This will serve as an act of goodwill and trust in Shopify’s integrated online business
framework and will help them to grow much bigger.

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