Tesco's Organisational Culture and Structure: An Essay

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Essay: Organisational Structure and
culture

Introduction
Organisational cultures and structure are the suitable aspects with highest predictive power with
understanding the causes and forms of people and behaviour in the organisation. Organisational
culture is being defined as system of assumptions, values, norms and attitude of different
members and behaviour within the organisation (Driskill, 2018). On the other hand,
organisational structure is defined as fundamental and planned actions and interaction with the
organisation members for the objective of achieving goals of organisation (Edwards et.al. 2014).
Essay will identify the effects of culture and structure on the business performance. For this, case
study of Tesco is considered that is one of the leading supermarkets in UK providing quality of
products such as Groceries, households, etc. In the modern Era, the organisation is evaluated on
the basis of culture and structure that is required to be managed critically. Essay gives detail
analysis of organisational culture and structure that is leading to success of the employees and
overall business performance. Moreover, suitable theories would be highlighted with the aspect
of organisational structure and culture.
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Discussion
Organisational culture and structure at Tesco
Tesco is a British multinational grocery and general merchandise that operate with thousands of
employees that are appointed at different locations. As per (Tesco Plc, 2018), organisational
culture in multinational is comprised as the suitable way in which employees complete the task
and interact with each other. The culture paradigm binds the workforce together and provides the
critical direction for the business. In times of change, biggest challenge for the organisation is
based on changing the culture and managing employees in that manner to achieve business goals.
Business is built with the objective of being the champion of customers, helping to enjoy the
better quality of life and achieving the easier way of living. Tesco have different dimensions and
nationality of employees working at different location.
Managers of Tesco follow certain a feature of the culture at Tesco that includes it creates the
environment in such a manner that lead to satisfy the employees. Tesco follows shared friendly
culture where employees are able to share their thoughts and coordinate with each other hand.
Along with this, cultural differences within the workplace are the suitable challenge for the
business to make profits (Carlos Pinho et.al. 2014). For example, expansion of Tesco stores in
China was great struggle because of the critical impact of the cultural factors. Employees faced
difficulty in communication with each other and also with the customers. Tesco defines the
culture as collective programming of mind that mainly distinguishes one category of the people
with other.
Handy’s culture theory is where the culture of organisation is being divided into four categories.
For example, the aspect of power culture that means power is held by just few individuals that
influence the organisation. Manager of department is responsible to observe the end objective
achieved by the employees rather than how they are performing. Role culture on the other hand
is culture where the roles and responsibilities to the employees are divided on the basis of
suitable structure (Handy’s culture, 2018). It includes business to follow the suitable chain of
command. Task culture is followed where teams in the organisation is formed to achieve
suitable objective. This includes working in team to achieve productive goals. Last, person
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culture is followed that includes collection of the individuals who happen for the working for the
same organisation.
Generally Tesco follows the hierarchical organisational structures that mean each of members
is well informed with the roles and responsibility. The structure interlinks with the Role culture
where each of the member is well informed with the role and functions according to different
sections and tasks. In addition it also follows the chain of command where reporting is submitted
to the regional manager and it offers responsibilities to divide overall operations in different
layers of management to achieve productive objectives. Along with this, business also focuses on
achieving the objectives with positive team working (Mey Meng, 2018). For this, Tesco also
follows Task culture where teams are being formed such as food section, non food section,
personnel management, etc. Management of each section enables Tesco to offer competitive
advantage from each of the section. Sometimes, this structure creates the bureaucracy with a bad
effect on coordination and collaboration among the managers. It is suggested for Tesco to reduce
the layers of management to create more flexibility.
Figure 1: Organisational structure of Tesco
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(Source: Mey Meng, 2018)
Apart from the organisational culture and structure, (Organisational culture and performance,
2018) defines employee performance as the expectation of the worker performance within the
suitable task and its effective execution. Employee performance of each staff member is being
assessed on quarterly or annually basis for identifying the suggested areas of improvement.
Having the positivity within the culture and working of the appropriate structure would directly
impact on achieving the employee performance.
Tesco operate on the international level and for that it needs flexible environment that help in
increasing the adaptability to change. Culture of flexible environment will promote employees to
attain the sustain growth and productivity for the employees. Tesco also follows the shared
culture and beliefs that increase the employee loyalty towards the organisation and achieving the
development in the employee performance (Kanten et.al.2015). For instance, having the rigid
and inflexible structure will hinder the growth of the individual and thus is creates employee
resistance towards work. Following the shared culture by the Tesco helps to have the better
understanding of the customers.
For example, Tesco follows the four layers of hierarchical structure that might lead to create long
decision making and might delay the business operations. Having the proper chain of control and
improved the employee- employer relations. However, following interdepartmental coordination
is improved with following the hierarchical structure. As per (Kabelo Lefifi, 2015), positive
culture impact on individual behaviour and thus it will lead employees to maintain the
coordination with other team members for the objective of achieving business goals. Tesco
believes in working together and efforts of the employees are based according to the needs and
wants of the customers.
Mechanism of mutual impact between organisational structure and culture
To reach goals, it is effective for the organisation such as Tesco to follow the formal system. For
this, it is necessary for Tesco to have the qualified and skilled workforce as this are treated as the
asset of the organisation. When the employees work together it is necessary for manager to have
strict monitoring towards employee’s efforts. There are different attitudes, perception, languages
and behaviour of the employees that mainly creates the cultural differences in the organisation.
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For avoiding the conflicts and such differences, it is necessary to have the formal structure in
which employees can be divided into team that will perform different functions.
There are suitable factors that affect the working of culture and also the operations of the
business. For example, long structure of organisation cans slower the process of communication
that is followed in different levels of hierarchy. Currently, organisation is following the
hierarchical divisional structure where section of Tesco is being divided into different parts. Such
kind of structure would create the culture for employees to work according to the decisions of the
manager. It is the responsibility of management to monitor that employee’s behaviour matches
with the organisational culture to have the excellent work relationships. As per (Kabelo Lefifi,
2015), it can be argued that if the business have the effective culture it is able to manage changes
in the organisational structure that will also help managers to manage changes and obtain
changes according to the environment. However, (Kabelo Lefifi, 2015) states that structure not
only increase the organisational capabilities but is will also improve the process that results in
increasing the business performance.
Role of leadership in forming business culture
As per (Antonakis and Day, 2017), Leadership is concerned with the bringing together the group
of people and directing them towards achieving the common goal. The author also argues that
creating environment in which employees can realise their individual and collective potential.
Generally there are three types of leadership styles that are generally adopted in different
organisation. One of the leadership styles includes authoritarian, democratic and laissez faire
leadership. Leadership in the organisation is concerned with implementing the decisions through
effective communication of the employees. Leadership plays effective role to shape
organisational culture and leaders regularly creates evaluation of the performance of the staff and
also motivate and reward employees for achieving the key targets.
Being a multinational, Tesco is currently operating with democratic style where employees are
involved in decision making for achieving the targets of providing good services to the
customers. However, when it comes to bring cultural change or driving organisational change,
leaders play critical role in shaping the behaviour of the team members. For example, Tesco
believes in following democratic style that mainly believes in having open communication and
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honest answers (Organisational structure and culture, 2018). This feel employees values and they
possess efforts to interact with the co members to achieve the targeted goals. With following
democratic style of management, it follows the decentralised structure where information passes
from the higher management to the lower employees where each of the employees is involved to
share their views that shape the current organisational structure.
Tesco is committed towards offering the best working hours and support that will match with
their needs. It supports the employees by offering them flexible environment to do task in the
manner they want only managers monitor their tasks and give them guidance to perform task in
effective manner (Tesco Plc, 2018). With the decentralised structure, high performance working
is supported by management where everyone is clear with the role and each role aims the best to
be done for every customer. Strategies of the Tesco to manage organisational culture has lead to
gain directive success on the edge over their competitors and even employees have strong
coordination that helped Tesco to grow well on the economic recession. Thus the clear
hierarchical structure help Tesco to follow the process of following flow of information from top
to bottom and reporting is generally maintained by the regional managers according to the
concerned structure of the organisation
Impact of individual behaviour on the work performance
As organisational research continues, questions generally began to come up by the organisation
about continuous changing behaviour of the employees and motivation of the individual within
organisation. As per classical theory of management, employee work was generally focussed and
behaviour and motivation of the employees was generally ignored. As per (Linda Ray, 2018), it
is necessary for manager to changing behaviour of the employees and it possess corrective
decision making. This can be supported by the behavioural theory of management that clarify
that workplace need to value better understanding of the human behaviour at work such as
motivation, managing conflicts, expectations and group dynamics that impact on the directive
organisational productivity. (Linda Ray, 2018) argues that culture of the organisation generally
influence the human behaviour. Positive practices of the organisation will make employee
satisfied to make long term relationships.
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Employee’s behaviour change is due to culture of organisation. For example, Tesco is generally
the large multinationals and working in the large retail store employees experience the feeling of
being unimportant and irrelevant on the large scale. Generally there is rare interaction between
the CEO and lower level of employees and manager not all the time pay attention towards
handling store operations. Manager generally delegates their responsibilities to lower level
executives. This mainly creates the culture of the workplace. However, poor coordination
between the managers and employees will influence behaviour in organisation.
Employees will begin to perform task in the manner they want. But, Tesco have the strong
operating culture where managers have the opportunities to create the positive environment
within the workplace and ensure that all the employees are being met. This supports employees
to feel recognised for their behaviours that would show the contribution towards the business
(Organisational culture and performance, 2018). Thus, if the employees feel that their role would
matter, it would shape to their positive behaviour that would influence on achieving
organisational objectives. Thus, people behaviour in the organisation also impact on the business
productivity. This require leaders to have strict monitoring towards the performance of the
employees but positive culture is required to be offered to them for achieving the eng goals and
objectives of the organisation.
Relationship between culture, structure people and organisational performance
As per (Andrea Reyes Ramirez, 2019) Strong culture has considered as the driven force to
mainly improve the performance of the employees. It results in enhancing self confidence and
commitment of the employees. For example, Tesco generally follows shared culture in which
employees are able to coordinate with each other to achieve key targets. Thus it would lead to
reduce the job stress and improves the ethical behaviour of the employees. On the other aspect,
strong support by leaders to motivate employees adds to employee satisfaction. As per (Linda
Ray, 2018), employee motivation is also the suitable aspect of shaping the organisational culture.
This leads to make employee satisfied and this impact on their efforts to attain organisational
goals. With strong culture, it has great impact on organisational behaviour where employee’s
goals match with the goals of management that leads to attain the growth in overall employee
performance.
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Every person in the organisation has own values and beliefs. It is necessary for managers to
allow each individual to be well informed with the process, activities and policies of the
organisation. It is also the responsibility of employees to take initiative to know about the culture
and have effective operations. Thus, this is helpful for employees to work according to the
culture of workplace (Andrea Reyes Ramirez, 2019). The adoption of culture effectively will
lead to conduct task in effective and efficient manner. For example, efforts of employees to
attain productive goals such as meeting with customer satisfaction directly impact on increasing
the net profits of the organisation. Positive development due to culture is effective when the
employees have adapted to the culture.
Tesco generally follows the decentralised organisational structure that means lower level of
managers are allowed to take effective decision making but the controlling depends on the board
and also managers are closet to take actions. Tesco have the functioning of pushing decision
authority towards downward to lower level of employees. This has helped Tesco to attain growth
with taking decision quickly and act more quickly to solve problems. Thus, success of the
organisation mainly depends upon the organisational sales and success to which organisation has
sold its products and services (Tesco Plc, 2018). On the other hand, it is also concerned with
ability of utilising the resources efficiently that helps to achieve goals and objectives and also the
satisfaction of the stakeholders.
It is the fact by (Kabelo Lefifi, 2015), that employees in the organisation want to work in the
environment that has well defined allocation of work, trust, coordination, respect, etc that will
show their clear contribution in the organisation. The ability of the manager to control,
communicate and coordinate the activities will lead to increase the workforce performance at
increasing rates. Thus, Tesco have the strategy of offering motivation to the employees and
valuing their performance. Tesco offers rewards, bonus, incentives, fair wages, etc that creates
the positive culture where employees lead to deliver effective outcomes. This can result in
increasing productivity and efforts of the organisation to attain effective market expansion and
growth in the international market. This enables Tesco to shape the individual behaviour and
make them satisfied to maintain long term relationships at the workplace.
For instance, Tesco follows the organisational theory that includes goals can be achieved with
setting suitable structure. For example, decisions of the managers in Tesco to handle daily
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operations must be based on working as per the chain of command and having regular practice in
the organisation. Thus, roles and responsibilities are also offered as per the designed structure
and other areas of the business are neglected. On the other hand, management theory is followed
that included valuing the presence of the workforce in the organisation. Thus, manager design
the set criteria for employees to perform the job. However, Tesco is trying to pay efforts towards
both such theories to evaluate the actual success of organisation with shaping the business
structure (Mey Meng, 2018).
On the other hand, positive culture generally leads Tesco to achieve the effectiveness of the team
dynamics. Shared values and working promotes involvement of the leader in the process of
decision making. Open communication is maintained by manager to avoid the internal conflicts
where employees are being allowed to share their views freely. Team working task is being
organised by the managers (Carlos Pinho et.al. 2014). This enables employees to coordinate with
each other to achieve common goal of organisation.
From the concerned study and arguments of the authors, it can be evaluated that three of the
factors such as culture, structure and involvement of the members directly impact on the goals
and objectives of the organisation. Thus, Tesco enables working with strong organisational
structure and culture that have the high retention power of maintaining long term relationships
with the employees.
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Conclusion
As per the above conducted essay, it can be concluded that structure and culture are one of the
important aspects of the organisation that leads to build productivity. Essay concludes that
employees are one of the most important parts of the organisation through which the suitable
organisational culture is formed and success can be attained with enhancing the satisfaction of
such employees. Tesco need to pay efforts towards reducing the level of hierarchy that will help
in achieving more productive goals. More flexibility can be attained if manager’s focus on
attaining flexible practices and efforts of the employees might be linked to achieve more
satisfaction of the customers.
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References
Books and Journals
 Antonakis, J. and Day, D.V. eds., 2017. The nature of leadership. Sage publications.
 Carlos Pinho, J., Paula Rodrigues, A. and Dibb, S., 2014. The role of corporate culture,
market orientation and organisational commitment in organisational performance: the
case of non-profit organisations. Journal of Management Development, 33(4), pp.374-
398.
 Driskill, G.W., 2018. Organizational culture in action: A cultural analysis workbook.
Routledge.
 Edwards, R., Crosling, G. and Lim, N.C., 2014. Organizational structures for
international universities: Implications for campus autonomy, academic freedom,
collegiality, and conflict. Journal of Studies in International Education, 18(2), pp.180-
194.
 Kanten, P., Kanten, S. and Gurlek, M., 2015. The effects of organizational structures and
learning organization on job embeddedness and individual adaptive
performance. Procedia Economics and Finance, 23, pp.1358-1366.
Online
 Andrea Reyes Ramirez, 2019 [Online] [Accessed through]
<https://smallbusiness.chron.com/relationship-between-organizational-culture-
performance-efficiency-multicultural-organization-72628.html> [Accessed on 12th July,
2019]
 Handy’s culture, 2018 [Online] [Accessed through]
<https://www.managementstudyguide.com/charles-handy-model.htm> [Accessed on 12th
July, 2019]
 Kabelo Lefifi, 2015 [Online] [Accessed through]
<https://www.linkedin.com/pulse/relationship-between-organizational-culture-structure-
kabelo> [Accessed on 12th July, 2019]
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