Is rationalization a desirable strategy for managing and organizing Junction Hotel in the current economic climate? Discuss your answer with reference to the topic of organisational change. Rationalization is an organisational concept that aims to increase a firm’s productivity, as it grows in size, through a reorganisation of its current system of operations. Throughout this essay I will be referring to the Junction Hotel case study along with other articles and critiques of the rationalization theory to determine how suitable rationalisation is as a solution for the problems facing Junction Hotel within the current economic climate.
During the 19th century, Frederick Taylor, a mechanical engineer, was a pioneer in the field of organizational management. He is well-known for his theory of scientific management, which placed emphasis on improving the physical efficiency of workers. According to Taylor, the main goal of management should be to ensure the employer’s maximum prosperity while also promoting the maximum prosperity for each employee (Fredrick Taylor, 1911, pg. 09).
Taylor conducted a renowned study in which he created shovels capable of consecutively loading the optimal amount of material (21 1/2lbs) to save time for workers and enhance productivity. By establishing a well-defined and structured authority over employees, Taylor had the opportunity to explore efficiency, which he deemed crucial for a prosperous workforce. In connection to the Junction Hotel case study, it is evident that the implementation of a more rational work design, inspired by Taylor’s techniques, could address existing organizational issues.
There is a lack of clear structure and alignment in the task expectations of the employees. The job roles of the General Manager, Deputy Manager, Head Chef, and Company Accountant are contradictory, causing confusion among the rest of the workforce. It is unclear who the employees should report to as their boss. To resolve this issue, a rational organizational solution would be to implement a more modern and bureaucratic style of management. According to George Ritzer (1996), earlier societies had organizational structures, but they were not as effective as bureaucracies.
The implementation of computer analysis is key in restoring order and control within an organization. By analyzing employee timetables, busy periods, and popular items among customers, a clear formation of job roles can be established in an organizational chart. This hierarchical structure assigns control to different regions of management, allowing for a more specific level of control over a growing workforce.
For Junction Hotel, it would be most suitable to separate the various working areas that are currently all supervised by the Deputy Manager. Instead, each area should be managed by a group of employees with expertise in that particular service. Subsequently, each group of workers can have their own designated manager to whom they report for daily tasks. By doing so, the general manager can play a more active role within the organization, thereby reducing some of the pressure on the Deputy Manager and granting the Head Chef control over their own workforce.
This approach would allow for distinct segmentation of each workforce, enabling managers to have a more targeted focus. It would be the most suitable method of implementing a rational, bureaucratic work design at Junction Hotel without compromising service quality. However, in order for Junction Hotel to maintain a competitive position in the hotel industry, certain personal relationships between cleaning and reception staff and the general manager might need to be restricted to enhance efficiency during the workday.
Taylor emphasized the lack of value in social relationships between workers and managers. As a result, he viewed his employees solely as a part of the production process. Over time, employees realized they could leverage their expertise and predict the time required for completing tasks based on their experience.
Taylor’s employees often exaggerated the time needed to complete tasks in order to avoid being overworked, a result of Taylor’s cold-hearted approach. This exemplifies the social issues arising from Taylor’s strong rational approach to work. Consequently, Taylor faced criticism, particularly from Max Weber, a German sociologist. Weber characterized Taylor’s scientific management theory as creating an “iron cage” environment, where workers felt trapped and dehumanized in their working conditions.
According to Weber, promoting employees based on their capabilities and providing them with career advancement opportunities was a better alternative to the conventional power hierarchy. Nevertheless, Weber acknowledged that achieving this ideal in the real world would not always be feasible. French & Rayner (2011) state, “Weber understood that the bureaucracy he was designing was an ideal prototype and could never be flawlessly implemented” (p. 315-316). Weber believed that there is no single perfect method for managing an organization, and organizational change becomes necessary when a business needs to modify its current operational system.
Social, political, technological, and economic factors are the main external influences that can bring about change in an organization. According to Barbara Senior (2001, pg. 57), various types of change occur at different levels within an organization. Organizational change specifically refers to larger transformations within a company, as opposed to minor modifications to its products or branding.
“Organisational change” refers to large-scale changes that affect the entire organization, as opposed to small changes like adding a new role or making minor process modifications (French & Rayner, 2011, pg. 574). For instance, when a company adopts new technology, it can significantly increase production efficiency, leading to adjustments in workforce size and production facilities. Henry Ford, the renowned figure behind Ford Motor Industries, is a notable example of an organization that successfully implemented changes in its production process.
According to Senior & Fleming (2006, pg. 8), Fordism and Taylorism ideology were closely connected. Ford implemented Taylor’s scientific management principles by assigning individual workers to specific stations on his assembly line instead of having a group of workers collectively working on one vehicle. This method increased productivity and saved time as the car would move along the line, stopping at each station for a new part to be added.
Through doubling wages to his famous ‘5-dollar-a-day’, Ford was able to expand his workforce and increase the production of automobiles. This approach to change, described as naive, viewed organizational change as a straightforward and controlled process managed from the top down, with a focus on the technological and structural aspects of the organization. According to Morgan (2006, pg. 25), this strategy not only stabilized the work situation but also persuaded workers to embrace the new technology.
The Taylorism and Fordism approaches gained popularity worldwide as businesses aimed to enhance output, reduce costs, and boost revenue. Production efficiency became paramount, but this came at a cost for employees. Many workers under Taylor and Ford struggled to maintain any sense of humanity in their repetitive and tedious tasks.
In the context of a decrease in efficiency, workers became fatigued and eventually unable to keep up with the rate of production. Charlie Chaplin’s video Modern Times (TheCharlesChaplin, 1936, Modern Times) perfectly illustrates this situation, as the worker is seen being dragged along the assembly line conveyor belt due to their inability to match the pace. The Junction Hotel case study also highlights a similar scenario, where front of house staff struggle to keep up with orders from the kitchen staff, resulting in conflicts among employees.
Ultimately, the dissatisfaction of customers can greatly harm Junction Hotel’s reputation, as they value traditional customer service. To address employee confrontation, team building exercises are highly effective. These exercises encourage collaboration among employees to achieve specific goals without the added stress of actual work.
The waiting and kitchen staff at Junction Hotel, who are new to team building, would benefit the most from a relaxed outdoor activity like raft building. According to French & Rayner (2011, pg. 410), outdoor experiences can be an exciting way for a group unfamiliar with team building to begin. Consequently, when both sets of employees return to work, there will be improved understanding and a sense of group identity among the staff. This social aspect of employee interaction during working hours was often neglected by traditional management approaches like Taylorism.
Nowadays, this social method of management in the 21st century is seen as a more popular and modern alternative to the traditional perspective of Taylorism. Back in the 1920s, Elton Mayo, who was an Australian psychologist, discovered the significance of group dynamics during his study on employee productivity. Mayo conducted experiments on 29,000 workers at the Hawthorne factory, where he explored the impact that lighting had on their efficiency. The main goal of his research was to determine the optimal lighting level necessary to achieve peak performance from the workers.
Mayo discovered that the level of lighting did not impact production levels directly. Instead, the human cooperative systems in which workers participated greatly influenced worker efficiency. When workers could establish themselves within an occupational community, they developed “group norms.” These norms consisted of regulations that workers considered more socially acceptable. As stated by Van Maanan and Barley (1984), “Members derived valued identities or self-images directly from their occupational roles.”
298). Expressions and labels such as “rate buster” and “the chisler” were employed to categorize workers as either over-workers or under-achievers, becoming nicknames that defined them. Mayo’s significant discovery was the influence of informal organization, recognizing man’s social nature beyond being just a machine. This phenomenon came to be known as the Hawthorne Effect. On the other hand, a bureaucratic management style is most suitable for organizations that prioritize quantity of revenue over quality, even if it means sacrificing it.
For instance, Travelodge, a rival hotel company, emphasizes to their clients that their service is straightforward yet includes all the essential items required for a pleasant stay. According to Davis (2009), “If you’ve ever stayed at a Travelodge Hotel, you might have noticed they don’t have shampoo in the bathroom.” This strategy, known as value engineering, enables larger businesses to reduce production costs while maintaining a commendable level of quality.
Higher-end hotels, like Junction Hotel in this case study, tend to disregard the strategy of cost-cutting as it can detract from their distinctive selling point of offering top-notch quality products and services. Junction Hotel is known for its commitment to traditional customer service, which includes an emphasis on personal presentation, customer interactions, and meeting individual customer needs.
The text suggests that rationalisation, which focuses on standardization and efficiency at the expense of quality, may not be suitable for a company like Junction Hotel that promotes itself as providing a calm experience. McDonald’s is cited as an example of sacrificing quality for increased productivity.
Customers can quickly order by pointing to a number on the menu, which allows workers to process payments faster and serve new customers more efficiently. According to Terry Hill (2005) from McDonald’s Corporation, the manager ensures that employees are assigned to tasks in which they excel, known as ‘aces in their places’. However, this rigid McDonaldization approach does not leave room for flexibility, posing challenges when customers request menu modifications. As a result, this slows down the overall process.
The process of adapting a single burger in the kitchen affects the schedule of the staff, leading to a domino effect on serving other customers. This significantly slows down the efficiency of the entire operation, especially if it occurs multiple times during the day. According to Weber, such strict time schedules and regulations result in dehumanization and lack of motivation among employees.
According to Ritzer (2008) in “The McDonaldisation of Society,” organizations are continuously striving for maximization in the hopes of increasing efficiency. However, the Junction Hotel has a distinct demographic compared to McDonald’s target market. Junction Hotel caters to an older age range of customers who can afford to spend more on high-end, premium quality goods and services. This demographic is likely to include retirees as well as businessmen and women whose expenses are covered.
Identifying the reason for this is crucial due to the economic state of the UK. After coming out of a recession, consumer spending remains sluggish in the country. As a result, it is equally difficult for high-end organizations, like Junction Hotel, to retain existing customers and attract new ones. This further supports the idea that a complete rationalization for Junction Hotel would not have a significant positive effect since it would only make them more similar to established competitors like Travelodge.
Despite an ongoing economic recovery from a recent recession caused by a ‘run on the banks’, consumer confidence remains low. This results in fewer individuals being willing to take risks and try out new organizations, particularly the ones that are more expensive. Nonetheless, recent economic reports have revealed an increase in gross domestic produce, which is a promising indication for Junction Hotel. This suggests that more consumers are becoming more at ease with spending additional money.
The Office for National Statistics has revealed that the UK economy experienced a 0.3% growth in the first quarter of 2013, which is seen as a positive sign for Junction Hotel’s future. Despite the small increase, economists believe it will provide a psychological boost to consumers and businesses. (Hugh Pym, 2013, UK economy avoids triple dip recession)
The Junction Hotel aims to gain a competitive advantage in the hotel industry by maintaining a premium quality approach. This strategic intervention focuses on targeting a different demographic who can afford hotel accommodation in the current economic climate. To achieve this, Junction Hotel will need to introduce a more rational work design to maximize efficiency and generate a respectable profit.
Implementing a rational approach in the relevant areas of an organization is crucial. Otherwise, it may negatively impact production rates, as observed in certain aspects of McDonaldization. To begin, a bureaucratic design must be established using organizational charts that clearly illustrate the hierarchical structure of management across the entire organization.
In order to provide a clear understanding of the organizational hierarchy and reporting structure, each section of the workforce should have access to this information. Additionally, team-building activities should be conducted quarterly to address any negative energy and facilitate communication between employees and their superiors, particularly among kitchen and waiting staff. It is crucial to maintain a professional relationship among all employees when interacting with customers.
While customer service may not be highly prioritized in the kitchen, a more laid-back approach could be beneficial if it enhances the social aspect of individual workers and ultimately improves efficiency. In general, it is evident that with effective leadership and a positive attitude towards organizational change among employees, rationalization becomes a viable strategy that can have substantial positive implications for Junction hotel.
