Question

Discuss the relationship between organisational structure, control systems, incentives and culture regarding the implementation of strategy.

Answer 1

There is a massive and a positive relationship between the organisational structure, control systems, incentives and the culture of the organisations in terms of the strategy that is being implemented in the working of the firm. In this answer, i'll take the example of the differential strategy and the relationship shared. As talked before, differential strategy works on the basis of providing a different quality or feature in your product or service in the market because of which the consumers would prefer your product or service ever if the prices are higher. The techniques or the actions you use are different and thus, it makes your organisation stand aloof.

1. Organisational Structure: The structure to promote the implementation of this strategy mentioned above would be a divisional strcture. Divisional structure have every product which promotes a line of functions for every product. Although costly, this structure boosts the decision making ability and decentralisation among the organisation and also provides effective potential and effort on every kind of product produced which gives a superiority to the service/product offered making it unique and special to be bought in the market.

2. Control System: Again, control system that would be implemented to establish an effective relationship with the strategy mentioned above would be an effective organisational control chart which would be used and employed in every department. This is to check if the differential elements are highly promoted in the organisation and everything is being acted and produced in accordance with the standards to have the least cost and maximum output to match the diserable strategy.

3. Incentives: The incentives offered while keeping a match with this strategy would be both monetory and non monetory incentives to boost the morale of the employee anyhow. Monetory incentives like more pay and bonuses would be provided to keep them interested in the job and non monetory incentives like appraisal and appreciation would make the employee satisfied with the job and thus would be happy in presenting and providing great ideas to promote a differential strategy even more .

4. Culture: At last, organisational culture plays a very important role in the determination of the strategy employed. The differential strategy is only possible when the culture of the organisation is open and flexible. Difference comes from innovation and creativity, thus by adapting diversity, inclusion, interactive and communicable environment in which ideas and concepts can easily flow and decisions can be taken (as talked in the structure part) a healthy environment is created and thus, the differential strategy can be implemented successfully.