Evaluation of Angus Dairy Co.’s Business Model

Angus Dairy Co. business model describes a system for creating value and revenue and its relationship with its processes so as to provide an overview of its business structure. This business model can be evaluated through six components; customers, competitors, economy, management and the products where competitors can be defined by the barriers of market entry, competition within their industry, threats posed by the substitute products and also the advantage that the company has of being the first in the market (Johnson 2016, p.60). The customers can be evaluated based on their characteristics, payments rates and their types of contracts with the company. The economy component is analyzed based on their acquisition if any, dividends, and economies of scale. Company management is analyzed through conflicts checking, moral view, past success and their relationship with partners. Lastly are the products where the company is focused on their brand loyalty, creating new products, competitive advantage, differentiation and innovation of value chain.

Angus Dairy organizational design ensures that its form of organization matches their strategy or purpose as well as meeting the challenges that may be posed by the realities of the business which significantly maximizes the likelihood of the individuals’ collective efforts being successful (Daft et.al 2010, p.60). Also, this organizational design facilitates a comprehensive assessment of the company so as to understand how it functions, strengths and weaknesses, and the alignment of their core business strategy and ideology. This process of assessment is astounding based on the clarity it brings to the company members and leaders, and also how the operating groups are interrelated. This analysis is supported by the use of organizational theories as it affects the social relationship between the management and the customers as well as affecting the company’s external and internal business environment (Shafritz et.al 2015, p.85). This theory provides that different activities should be identified and divided into different groups with the aim of achieving a common goal of the company and doing so effectively.

Here, the main focus is how Angus Dairy Co. management is structured and how well the operating groups therein are organized so as to accomplish the tasks that have been allocated to them. Also, organizational theory focuses on enhancing management efficiency first for process standardization of the processes before they are moved to an operational level where individual workers familiarize themselves with the changes where they implement them in their jobs. However, there are some theories that emphasize the improvement of workers efficiency, at the operational level, first, which will improve management efficiency (Hatch 2018, p.100). Modern theory is an organizational theory that states that an organization is an open system which can change when surrounding environment changes, both external and internal. This means a company interacts with its environment consistently to sustain and also to grow in the market. Angus Dairy Co. growth and survival, especially outside Australia, is determined by environmental changes in the global market, hence the adaptive nature of the company that makes allows it to adjust itself to the environmental changes.

Angus Dairy Co.’s Organizational Design and its Relationship with their Strategy and Ideology

Modern theory indicates that the company’s business model is probabilistic in nature as the results of its business are uncertain and it depends on the occurrence chances. It also encompasses that the company has both multidimensional and multilevel aspects meaning that it covers the macro and microenvironment of the company which are the company’s external and internal environment respectively (Zheng, Yang and McLean 2010, p.769). In my opinion, Angus Dairy Co. structured its operations the way it has, in order to grow and function and to have clarity and focus on their business. Another reason is to have an organized flow of authority and leadership where every individual has a clear idea of their tasks, who they supervise and ultimately, who they report to enhancing clarity throughout the entire company.        

The contemporary organizational structures and design include matrix, network and team designs, where matrix structure purpose is to use the cross-functional teams to their maximum so as to get the job done. By doing this, the company creates unique training opportunity across functional areas which in turn lead to better cooperation, higher productivity, increased flexibility, improved strategic management and heightened accountability (Barker & Cheney 2014, p. 20). The other contemporary design is team design where employees are formed in groups from several functional areas aimed at exploring possibilities and also solving problems. Team structure main objective is breaking functional barriers among the departments down so as to improve efficiency and strengthen working relationships. When each department gives one member to the group ensures that the interests of everyone are represented during decision making and problem-solving processes (Gordijn, Akkermans and Van Vliet 2011, p.14). The other one is network design which is a combination of the different organization types where their actions are coordinated by agreements and contracts instead of formal authority hierarchy. Usually one of the companies’ is the one that takes the lead in network creation where various satellite organizations are clustered around a core firm. The core firm provides services regarding areas like product development and marketing through coordination of network processes.

Contemporary organization embraces several human resource management practices which include weekends off, mandatory leaves, bonuses, and a variable pay among other things. This is because people are one of the main assets in a company as they ensure the sustainability of their competitive advantage. These practices are viewed as a way to motivate the employees to do their best in their work (Hill, Jones and Schilling 2014, p.90). This is due that motivation is driven by external rewards as well as internal needs hence, these practices ensure there is sufficient motivation among the employees. The main issue here is the need to balance the external and internal motivators and its where contemporary structure stimulates the need for self-actualization and the inner drives through the provision of eternal rewards in place of other motivators.

There are four types of market practices in organization settings which are; transactional marketing, interactive marketing, database marketing and network market where transactional marketing includes managing the four marketing Ps so as to satisfy and attract customers. Database marketing includes using technology-based tools so as to target and retain consumers. For database marketing to be successful, then managing data selection, privacy issues, data integrity, supplier relations and data application and analysis are crucial to it (Coviello, Brodie, Danaher and Johnston 2013, p.40). The most important factor in readiness of the organization for database marketing is fostering market orientation. The other type of marketing practice is interaction marketing where developing interpersonal and buyer-seller relationship is examined. Network marketing emphasis on the firm’s position in a connected interfirm relationship set.

Organizational Theory and its Impact on Angus Dairy Co.

Organization control costs in several areas which are; financial, decreased responsiveness, damage to culture and reputation, and botched implementation. Example of financial cost arises when the organizations perform and reports financial audit results. The audits are undertaken by external firms which charge a certain fee for their services. Organization controls also affect the company’s reputation and culture which will end up affecting their revenue turnover (Saxton & Guo 2011, p.280). As organizations want to keep employee behaviour on track by strictly monitoring them, these efforts may experience undesirable cultural consequences through reduced employee loyalty or damage to their external reputation which, if not properly looked at, reduces their profits. Incorporation of the organization’s vision for long-term and future business goals increases financial practices effectiveness which are related to long or short-term investments and capital assets purchases assisting in the achievement of long-term goals. Also, incorporation of strong internal controls in the financial practices is a good way to protect organization’s best interest which increases the effectiveness of the business.

Internal controls like transaction authorization standards, separation of duties and documentation requirement will maximize accountability while minimizing any risks that are associated with financial practices (Husselid 2012, p.650). Lastly, for the effectiveness objectives to be achieved, some basic understanding of business finance is required. The more the knowledge on cash management practices, costing, budgeting and forecasting, income tax requirements and financial reporting, the better the position one is so as to ensure effective financial practices and to protect the organization from fraud, abuse of resources and employee theft (Teece 2010,p.180). That being said, financial management practices are crucial to the performance and growth of organizations, hence the effort to check it practically which enables policymakers to know the areas to consider, areas like; dividend policy, working capital, capital structural decisions, investment techniques and performance assessment, when making financial decisions.

References

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