Question

descride the organizational structure of 1 traditional and 1 online retail, identifying managment of leadership challenge for each type of retailer.

Answer 1

The traditional retail entity whose organizational structure I am discussing here is Costco and the online retail entity is Amazon.

Costco has a functional structure and a secondary divisional structure. Using the functional structure Costco has divided its employees as per the business functions such as marketing, finance, HR etc. Using its secondary divisional structure the organization divides its operations into different geographical regions.

With regards to management of leadership challenge at Costco it has to deal with the problem or the issue of keeping morale and productivity of employees high through effective leadership. To ensure this Costco functions as a flat organization and it has minimal layers of management. Thus the leadership thrives on the inputs and suggestions of employees and employee’s involvement in decision making keep their morale and productivity high. This ensures that leadership is strategic and visionary as well and helps the organization to achieve its goals and objectives in a systematic manner.

With regards to Amazon it has a hierarchical structure. Amazon’s business has developed immense size and its operations are now spread across the globe. The hierarchical structure of the organization helps it to operate in an effective manner considering its large scale. Amazon uses this structure to integrate its various small teams and units with the different aspects of its business.

With regards to management of leadership challenge at Amazon the company has the leadership challenge of being flexible so that it can adapt to frequent changes that it is exposed to in the market place. The online retail market is highly dynamic and hence Amazon meets the leadership challenge of being flexible and being able to adopt by operating in an integrated manner. It also helps the organization to focus on innovations that adds incremental value to its operations.