With the economy experiencing a double dip recession, which is the deepest and longest recession in generations, there is a significant lack of demand for goods and services. The Autumn Statement 2012, delivered by Vice Chancellor George Osbourne on Wednesday the 5th of December, indicates that slower growth can be expected [1]. Considering these factors, the future appears bleak for Junction Hotel. Chance is concerned about the hotel’s current economic situation and believes that Meg Mortimer’s (General Manager) social management approach needs to be addressed due to its inefficiency and lack of organization.
An alternative management approach for the hotel could be ‘Rational Organisation’. This approach aims to address and enhance the underperforming areas of the hotel. Rational Organisation acknowledges that labour, such as wages, is the biggest cost for a business. Therefore, it emphasizes the need to reduce costs by implementing fragmentation of production. Additionally, it emphasizes on improving control, efficiency, and adopts a formal management style. Bureaucracy is also a significant aspect of this type of organisation [2].
These methods collectively would enhance Junction Hotel’s management efficiency by establishing a clear hierarchy and accountability system. Rational Organization was widely utilized by various organizations in the 1900s, with notable proponents including Taylor, Ford, Webber, and Fayol. This type of organization is also referred to as ‘Taylorism’ or ‘Fordism,’ specifically naming Henri Ford’s principles of production. Fordism focuses on achieving higher levels of output through the utilization of conveyor assembly lines and the division of work into smaller, less complex tasks [3].
Summary:
Fordism and Taylorism are both concerned with increasing efficiency, but they differ in their focus and approach. Fordism prioritizes minimizing workers’ tasks, while Taylorism emphasizes profit maximization and the use of scientific methods to optimize efficiency [4]. Taylor sought to enhance workers’ performance by developing new working methods that would make their jobs easier, rather than extensively breaking down tasks.
How could Rational Organisation benefit Junction Hotel in the current economic climate? One advantage would be the implementation of a level of Bureaucracy, which would clarify the chain of command for different areas. Specifically, a designated person would be responsible for overseeing the restaurant. This arrangement would enhance accountability for waitstaff and improve overall efficiency. Consequently, the restaurant would be better organized, resulting in improved service quality and faster delivery for customers.
Furthermore, by breaking down the tasks for the hotel into smaller and simpler ones, it would make them easier and quicker to complete. This would make recruiting new employees for the hotel effortless, as the training time required would be reduced. Consequently, the hotel would save money on worker training, as it would be shorter and less costly. Additionally, Rational Organisation’s introduction of a set of rules and regulations to the hotel would enhance control. As a result, the output per worker would increase, ultimately leading to a higher overall output for the hotel.
Charles Broadhead Marketing Design and Communications Foundations of Marketing and Organisation Rationalisation is a widely used form of management worldwide. It is applicable to various industries, including the fast food industry. Among all fast food restaurants, McDonald’s is especially notable. In fact, some marketers have coined the term “McDonaldization” to describe McDonald’s successful use of rational organization [5]. McDonald’s has efficiently divided the production process of their standard hamburger into small tasks.
One person would add the salad to the bun, while another colleague would add the sauce and yet another would add the cheese and burger. After this, the burger would be boxed up by another worker and sent down a tube for the customer to eat. McDonalds even breaks down their customer service into tasks. They have tills with touchscreens where workers can quickly enter customer orders by selecting icons. Rationalisation has been successful for numerous large organizations in the past.
Firms have experienced advantages such as increased efficiency, enhanced control, and reduced expenses. Nevertheless, not all types of organizations have benefited from this. Rational Organization has had negative impacts on its employees. The confined and suffocating work conditions have resulted in workers’ poor health. The monotonous and dehumanizing tasks have been linked to workforce inefficiency. Additionally, the tedious nature of the work has made employees feel unutilized and that their skills are being wasted.
This work has resulted in issues with workers’ mental health. This refers to the fact that workers would often find ways to gamify or create patterns in their work to increase efficiency. Considering this, Junction Hotel’s service is highly social, and the direct and straightforward methods of Rational Organization may affect the type of service provided. We have discussed how Rational Organization works, its pros and cons, but is it truly the most desirable strategy for managing and organizing Junction Hotel?
Some argue that Junction Hotel lacks structure and clear management, as the case study indicates that the organization does not have an organizational chart. To address these concerns, introducing rational organization would be beneficial. Implementing rational organization would introduce a level of bureaucracy that is currently lacking at Junction Hotel. Additionally, rational organization would help reduce costs and improve efficiency. Consequently, the hotel would not only save money but also generate more revenue, resulting in a more stable and profitable business.
On the other hand, there are drawbacks to consider regarding rational organization. These include the health of workers and their entitled working hours for repetitive and dehumanizing tasks. In the past, scholars have argued that changing a team and their habits can be challenging (Zaltman and Duncan, 1977). Resistance to change can arise due to factors like team solidarity, conflict, and rejection of outsiders [6].
References:
[1] http://www.bbc.co.uk/news/business-20550112
[2] Ian Brooks “Organisation Behaviour: Individual’s, Groups and Organisation” (4th edition) – Pg193
[3] http://www.businessdictionary.com/definition/Fordism.html
[4] Ian Brooks “Organisation Behaviour: Individual’s, Groups and Organisation” (4th edition) Pg158
[5] Ritzer, G, (2008) “Efficiency: Drive-Throughs and Finger Foods” from Ritzer, G, The McDonaldization of Society pp. 57-78.
[6] David Coughlan, “Leadership & Organization Development Journal, Vol. 15 No. 2, 1994: Organizational Change through teams and groups.” Pg. 18-23.
