Preface:

A leader's job is to create the direction so the company can move forward. The leader does this in steps. Here are the steps of the process:

First, the leader designs the vision and mission for the company and

Second, the leader must establish an organizational structure which promotes the vision, mission and empowers the employees to keep the forward movement in the organization.

In creating the structure various factors must be considered.

• First and foremost is the purpose of the company or organization. What type of structure will best accomplish that goal?  Certainly a company like UPS needs a somewhat rigid structure that is set up to focus on procedure and time sensitivity.  Since UPS has as its goal to get the correct parcels to the right customers in the fastest possible way, variance in procedures or ways of accomplishing the tasks would not work well.  A tight delineated structure is imperative.
• Along with the purpose the leader must look at the vision of the organization. Where does the leader want the organization to go? How best can the structure provide for the future?  Will the vision call for expansion into other countries or simply call for product development changes?  Does a leader plan a structure that can easily grow in size without harming its integrity or one that focuses on the best way to make new products?  Also, vision must be built into the organizational structure.
• The people who make up the organization, their jobs and the decision making authority should be considered. The authority must flow and make the organization respond favorably to the decisions and changes that are needed to move the organization forward toward the vision while making sure stability continues to keep tasks on track.  This is tricky because the leader's job here is not to tell the manager what procedures to use or make but rather to set up a structure and authority to make it possible for them to develop those procedures, etc.
• The structure should be people centric focused on how people will best work together to get their jobs done while still focusing on the vision and the necessary change that is inevitable to keep the business alive in the 21^stcentury. Change is the operative word.
• Budget is a major consideration in the present and in the future.
• Finally, environmental factors like sustainability and knowledge management will need to be considered in developing the structure.

Learning Activity #1: Creating a Vision and Mission Statement

The following fact pattern has an existing vision and mission statement created by Richard Purvis of the Jordan Shoe Company before he considered an expansion.

The two statements contain mistakes and are not the best for the current company now that an expansion will take place.

Students are to change the vision and mission statements to help Purvis obtain the best design for the company's organizational structure and culture as possible.  Be sure to explain what mistakes you see and how and why you corrected them to make it better for Purvis using the course material as support.

Richard Purvis started the Jordan Shoe Company in Boulder Colorado. The company is known for its great specialty tennis shoes at moderate prices.  The company designs and creates fun shoes for young children, mostly girls.  Catering to the age group of 1-12 years, the shoes are popular in Colorado.  The shoes have been growing in popularity and Richard is thinking of expanding into other states.  Business has grown steadily in the last seven years and the company's future looks bright.  If Richard expands the company he would have to set up two plants in other states and will have to reorganize the Colorado plant. 

The staff has always gotten along well because Richard has been able to keep things on an even keel with his personality and concern for their each employee's personal welfare.  Richard would have to find someone to take his place to run the plant in Colorado.  He wants to set in place a structure that will continue to grow the business while ensuring quality, reputation, and the happiness of its employees are maintained. 

Purvis has set up his factory with a horizontal collaborative structure.  He has four departments; design, the production department, sales and marketing, and administration.  Each department has a manager that acts as a team head.  Purvis meets weekly with all the heads together and individually off and on during the week.

Purvis currently employs a plant manager who heads the production department, which has 12 factory workers, two salesmen one of whom is the team head that also handles the marketing aspect of the business.  The administrative head is the general manager, and there are two office workers and a bookkeeper.  Finally, the design team has three employees one of whom is the head designer who leads the team.

The cost of expansion could be done effectively if the current profit level remains stable and that can only be done if the Colorado plant continues to run smoothly. 

The current vision for the company is: to produce the best children's specialty shoes.

The mission is: to produce quality, stylish shoes that are known for their durability, style, and contemporary kid fashion. The "kid" must be in every shoe.

Purvis believes strongly that his employees must be free to create the best shoes possible.  He wants them to work together happily and with a commitment to the development of the vision.  He also wants them to continue to work together as they do now and to encourage creativity among them all and not just with the design department. He wants to empower them but the shoes have to be completed and shipped promptly.

Learning Activity #2 Organizational Structure

Review the Purvis fact pattern and identify the structure that Purvis currently has.

• Identify the organizational structure. Does the structure fit the purpose of the company?  Why or Why not?  Explain in detail using the course material as support. Be sure to include in the discussion the idea of the decision making flow.
• Select from the course reading three types of organizational structures that would work as well if not better for Purvis once the expansion takes place. Explain the pros and cons of each structure and determine what organizational structure would work best fit for Purvis.  Support the reasoning using the course material.