Decentralization increases quality of decisions. January 3, 2017. Many organizational members are afraid to say ‘no’ to someone higher up in the hierarchy. Aligning HR with business strategy can boost employee satisfaction and performance, ensure teams are aligned to help the business achieve its strategic objectives, and increase their influence and decision-making power across the organization. He is an expert in strategy management. Facebook Inc. Report contains more detailed discussion of Facebook business strategy. Collectively, the best practices allow executives and managers to successfully executie their strategy and achieve the goals of their organization. Structure and strategy are married to each other. b. structures rarely evolve in response to strategic change. Centralization slows decision-making. Aligning organization structure to strategy is crucial for strategy execution success. The strategy path defines what needs to be done; the culture path emphasizes how things are normally done. Aligning the Organization with Strategy, Vision and Values  The most successful business organiza-tions intentionally focus and align the efforts and energy of all employees on defined end results. His passion is to help organizations better develop, execute and control strategy. When implementation tasks are new, complex and contain matters not foreseeable by management, a top-down implementation tactic is problematic. Facebook is an online social media and social networking service enterprise located in Menlo Park, California, the USA.The founder and CEO Mark Zuckerberg was a Harvard College student. The central bar expresses the mean. Yet, Google isn't only that. Membership is free, with the platform generating most of its revenue from paid advertisers, who are able to reach prospects and customers in a highly targeted and engaging way. The main advantage of a decentralized structure is that it increases the commitment of organizational members to decision-making, decisions can be made more quickly, and improves the quality of decisions as it makes more use of specialized knowledge of employees at lower levels in the organization. How to Determine the Best Organizational Structure. 8 best practices for aligning strategy, planning, and risk ... Its vision: To be the best company in the industry based on superior financial strength, high dividends, and delivering a high-quality customer experience. Here are a few ridiculously powerful Facebook ad … Most of this earlier research focused specifically on the strat… Furthermore, as top management tend to have very busy agenda’s many decisions are only taken during periodic board meetings. A decentralized organization structure results in more effective strategy execution. Extensive and continuous focus on user experience. Extensive and continuous focus on user experience. This in turn increases their commitment to the strategy. A company rewards itself when exponential leaders align culture with strategy. An organization’s long term success relies heavily on leadership, its ability to embody/implement your company culture and to lead the company toward its strategic goals. The concepts of strategic management dates back to the early 1950’s, when Peter Drucker first proposed the theory of Management by Objectives (MBO), and Philip Selznick introduced the matching of an organization’s internal factors with the external environmental circumstances in 1957. d. Borders' decentralized structure led to poor decision making. 4. Google is the most significant tech, distribution and commercial success of the previous decades. Unforeseen circumstances are ignored or slowly acted upon. Valuable information is often filtered as it travels up the chain of command. Modern human resources departments manage much more than hiring, onboarding, and benefits. Currently, Facebook product portfolio includes Profile, News Feed, Messenger, Groups, Events, Video, Photos, Search, Pages, Instagram and others. Centralization creates a false appearance of compliance. It refers to the way in which tasks and responsibilities are assigned, coordinated and controlled in an organization. An authoritarian management style removes control and discretion from employees increasing their sense of powerlessness. The strategic planning could be defined as the process of creating and implementing decisions about the organization future (Kerzner 2002). “Alignment” is … When organizational members are not used to making decisions, taking responsibility or initiative, and have little to say about the way in which they perform their work, they will not come to view themselves as competent and independent organizational members, having a negative influence on their level of self-efficacy and job motivation. Moreover, the report contains analyses of Facebook leadership and organizational structure and marketing strategy and discusses the issues of corporate social responsibility. New product development. This increases the strategy execution performance of organizational members. This article is based on my PhD research at Rotterdam School of Management, Erasmus University – one of the top business schools in Europe. For example, if an automobile manufacturer is divided into four strategic operations in geographically distant locations, the center of the company must coordinate all of the activities to ensure that each network partner is meeting its share of the organizational objectives. Nevertheless, an uncompromised approach on user experience and an adequate balance between standardisation and customization of the website resulted Facebook becoming the most popular social networking site within a matter of a couple of years. Valuable expert knowledge is not tapped into. Borders did a good job of implementing its strategy but its structure was wrong. Competent organizational members leave the organization.  Rusli, E.M. (2012) “Facebook Buys Instagram for USD1 Billion” New York Times, Available at: http://dealbook.nytimes.com/2012/04/09/facebook-buys-instagram-for-1-billion/?_r=0, Interpretivism (interpretivist) Research Philosophy. a. The report also illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis and McKinsey 7S Model on Facebook Inc. The company applies its organizational culture as a tool for supporting business resilience and competitiveness. Indeed, the company managed to conquer the web and build an over a hundred billion a year turnover based on digital advertising alone! We’ll also review two different types of organizational structures and how you would go about aligning your project, depending upon which organization you’re in. Facebook business strategy integrates the following four principles: 1. d. Borders' decentralized structure led to poor decision making. Research has shown that most strategies fail in the execution phase. In a decentralized organization is decision-making authority delegate… Development of new products and services is placed at the core of Facebook business strategy with positive implications on the numbers of its user base. This is especially the case in more collectivistic cultures with a high power distance such as in Asia, Africa and the Middle East. With a clear focus of what it wants to achieve, the organization will proceed to align its structure in such a manner to best achieve this. Earlier in 2012, Facebook bought Instagram a popular photo-sharing application for USD 1 billion cash and stock.. In 2015 the company generated revenues of USD17.93 billion, which is an increase of 44% year-over-year and ad revenue was of USD17.08 billion, which is an increase of 49% compared to the previous year. Current turbulent business environments requires quick decision-making. This increases the quality of decisions as specialized and operational knowledge of lower-level employees is tapped into to. Centralization reduces motivation and competence of employees. Under this model, every aspect of the IT strategy should support the goals of the business. When organizational members are not involved in the strategy formation process, they are not likely to be committed to the strategy. A highly centralized organization can negatively influence the level of competence, feeling of competence and job motivation of employees. Note the dramatic difference between high and low performers on each measure. My research found that a clear, relatively decentralized and relatively formalized organization structure has a positive influence on implementation performance. Facebook business strategy focuses on establishing presence in various branches of e-commerce via acquiring relevant businesses. Furthermore, participation increases the speed of decision-making as decisions do not need to be referred up the hierarchy. In 2014, the company purchased Oculus VR, Inc. (Oculus), a company developing virtual reality technology and WhatsApp Inc. (WhatsApp) messenger application for mobile devices. In highly decentralized organizations are organizational members at all hierarchical levels empowered with decision influence. You can target audiences on Facebook with a dozen different ad formats and thousands of possible ad targeting parameters.. Mastering your Facebook targeting strategy gets you in front of very specific and often motivated segments of your audience, on the network where Americans religiously spend an average of 40 minutes of their day. Borders did a good job of implementing its strategy but its structure was wrong. Individuals have a desire for personal control. This requires a great deal of close supervision from management taking up a lot of time and energy. a. Facebook constantly experiments with different strategies finding and utilizing news ways of monetization in a regular manner. Such improvement focuses on Facebook’s mission and vision statements . Today we’re talking about how to align your project to business strategy. When possible, management must ensure that the organization structure is clear, decentralized and formalized. Since its inception in 2004, this social network has grown exponentially. centralized organizational structure with rigid organizational policies combined with a perceived lack of control results in passive maladaptive behavior in organizations (Martinko & Garnder, 1982). Facebook did not have a first mover advantage in online social networking segment, as it was launched after Friendster and MySpace. ... Have a cost structure (combination of selling and administrative expenses) in the top quartile in the industry. An organization structure is a system that arranges the hierarchy in an organization. Once competent and ambitious employees start leaving an organizations is in great trouble.  Solid financial position that can enable more strategic acquisitions in the future is one of the key sources of Facebook competitive advantage. Lower-level employees have more knowledge about day-to-day operations activities and are more familiar with the issues at hand. 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