The Italian brothers Sergio and Bruno Costa envisioned and found the Costa Coffee in the year 1971. From the beginning, the focus of the organization was on the quality of the coffee. Because of its high quality offers the boutique hotels and restaurants in the Italian cities preferred the brand. Even today, the company has been following its emphasis on sourcing premium quality coffee and with the least harm to the environment.
Over the years the company has established about 2,000 coffee shops in the UK and about 1,250 shops in other countries. Costa’s coffee shops have been rated as the best-branded chain in the UK consecutively for the last five years. The company was able to deliver excellent coffee and services because of its organizational management and teamwork. In order to maintain its preeminence, the following organizational measures i.e. managing organizational culture and structure, and developing effective teamwork in the organization, may be adopted.
There exists a close connection between, an organization’s structure and its culture. How a structure and culture can be managed effectively is provided in this report along with guidelines to develop effective team working. The report is made as lucidly as possible to help the managers to grasp the importance of theories and their applications.
The overall performance and direction of an organization are mostly influenced by the nature of its strategy, structure, and culture (Mullins, 2010). The Strategic components of an organization are business goals, objectives and policies that often determine the structure and processes within the organization. The culture determines how organizational processes are carried out.
Though the organizational theorists have defined the structure differently, it converges to a few key factors. For example, Hitt, Chet Miller & Collella (2009) defines the Organizational structure as a formal arrangement of work roles and authority relationships that integrates how employees and managers work together, and Mullins (2010) points out the structure as a framework for an organization to enable the applications of the process of management.
Because the structure of an organization affects productivity, profitability, employee morale, and job satisfaction, Costa Coffee must design its organization appropriately. A matching structure to source the premium coffee beans, process them and deliver with excellent experience must be established. The centralization and decentralization of the decision making should be based on the goals of the business. Because Costa Coffee emphasize on the environmental sustainability, zero waste sourcing, etc., the managers must have centralized purchasing and supply chain process, but with respect to creating experiences in the coffee shops, the retail store managers may have decentralized decision-making powers.
Depending on the decision-making practices and the complexity of the works to be carried out, Costa Coffee’s structure must enable the appropriate division of work among employees, and coordinate their activities.
The managers of Costa Coffee must realize that a poorly designed organizational structure can have adverse consequences and undesirable effects. Production inefficiency, lower employee motivation and morale, delays and inappropriate decision making, interpersonal and group conflicts, high costs and wastages and lack of fulfillment and business growth are the results of the inappropriate structure. The structure of an organization can be marked on a single paper, which can be called as an organizational chart.
All employees must be aware of the organizational chart of the Costa Coffee so that they can learn how to respond to the instructions and communication from the managers. The organizational structure expressed in a chart provides clues to the decision-making process, delegation, and empowerment of employees and the formal relationship between supervisors and subordinates.
Mullins (2010) suggests that though organizational culture is a common concept, it has many connotations and is difficult to express or explain exactly. For example, Atkinson (1990) explains organizational culture as a manifestation of the deep-seated assumptions about the means an organization’s work is accomplished, such as what is ‘suitable’ in the organization, and what is not ‘good enough’; and what behaviors and actions should be encouraged or discouraged. McLean and Marshall (1993) provide a more detailed definition of culture as “the collection of traditions, values, policies, beliefs, and attitudes that constitute a pervasive context for everything we do and think in an organization”. According to Mullins (2010), “corporate culture is a collection of shared values, beliefs, policies and attitudes within an organization which is reflected on employees’ ways of working and communicating within the company.”
Similar to organizational structure, management of culture is also important to Costa Coffee. Organizational culture explains how actions are performed in the organization and it develops gradually and is influenced by a number of complex factors such as leadership, organizational values, ethics, etc. Effective management of human resources to a large extent depends on the characteristic features of an organization – and its culture. For example, the values of Costa Coffee, such as the meticulousness in selecting the best coffee beans, emphasize on environmental sustainability, attempting to bring down the wastage to zero, creating a memorable experience to the customers, etc. will have a profound effect on the working of the employees and the departments.
A model of culture, proposed by Charles Handy (1993) presents organizational culture can be classified into four types: the power culture (where the power lies with the people occupying the center position), the role culture (roles played by the job incumbent is important than the person), the task culture (the job must be completed somehow and the resources of the organization are critical and valuable), and the person or support culture (this culture supports key individuals such as experts in the organization with resources and people). Costa Coffee may utilize the role and task culture to achieve organizational goals.
For organizational survival, the Parson’s AGIL model is useful, it has four components.
The mangers of Costa Coffee may adopt Parson’s model to sustain its competitive advantage and reputation in the market through proper organizational management.
Organizations can achieve their goals through the coordination and motivation of employees through structure and culture. Even though the structure looks like a rigid entity in the organization, both structure and culture can mutually influence. For example, the factors: the size of the organization, leadership styles of the managers, strategic objectives of the organization, macro-environment surrounding the organization, the culture of employees and organization, etc. can influence the effectiveness of the structure (Bobby, 2002). For example, in the presence of highly creative and independent employees, the centralized structure may not be effective. Similarly, the inflexibility of a hierarchical structure affects the performance of creative and enterprising employees. Probably, innovative employees may leave the organization leaving space for conforming employees. The Mangers of Costa Coffee must choose suitable organizational structure and culture that is required to implement its business strategy and maintain its reputation.
A team is a group with complementary skills among members and mutually accountable for the outcomes. A group, according to Marvin Shaw, “is two or more people interacting with one another in a manner in which each person influences the other and is influenced by the other”.
Effective team working is important for every modern organization (Mullins, 2010), especially one like Costa Coffee. The managers in the company must be aware of, learn team development skills and provide leadership to the employees. The following measures (ACAS, 2007) can be taken by the managers in improving the team working at Costa Coffee.
Developing trust among the team members is critical and the effectiveness of the team depends on tasks to be completed, the characteristics of technology utilized and the organizational climate/culture.
The retail chain Costa Coffee can improve its organizational management with an understanding of the influences of the organizational structure, culture, and team working. The mangers shall benefit immensely by understanding various models and theories associated with organizational management. Also by following the recommendations and suggestion provided above can help the organization to maintain is brand value and employee satisfaction.
ACAS (2007) Teamwork: Success through People advisory booklet, ACAS.
Adams, S. (2008) ‘A-Class Teams Achieve A-Class Results’, Manager, The British Journal of Administrative Management, autumn, p. 21
Atkinson, P. E (1990) ‘Creating Cultural Change’, Management Services, vol. 34, no. 7, pp. 6–10. 10
Bobby, D. (2002) Management: An Introduction, 2nd Edition, Pearson Education
Costa Coffee 2016, About Us, Accessed on 2nd December 2016,<http://www.costa.co.uk/about-us/>
Handy C. B. (1993) Understanding Organizations, Penguin
Hitt M. A., Chet Miller C. & Collella A. (2011) Organizational Behaviour, Third Edition, Wiley
McLean, A. and Marshall, J. (1993) Intervening in Cultures, working paper, University of Bath, 1993.
Mullins L. (2010) Management & Organisational Behaviour, Ninth Edition, Pearson EducationOrder Now