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Business Studies: Case Study

Better Essays

Peter Nicholson wishes to convert the factory in the north east to production of the electric taxi. Using data in Appendix C, Table 1, calculate payback period and the average rate of return.
(8 marks)

Peter Nicholson proposes to remove two management levels from the organisational structure and to encourage greater empowerment of the workforce. Do you think that this is a good idea? Justify your view.
(18 marks) I believe that delayering the organisational structure by two management layers will encourage greater empowerment of the workforce. He would do this by flattening the organizational hierarchies whereby layers in management are removed and the existing managers’ span of control is broadened. It is …show more content…

Emphasis is on Kaizen group’s employees with a common interest of the process of production for example designers, installation employees and production manager.
To this extent, removing two level of management can be justified but sometimes negative effects could occur. For instance, the managers who will be axed will demand for early retirement pay which will add up to the redundancy costs. Some of them might challenge the process in court increasing costs through legal battles. In addition, people who rise to managerial level possess the required experience, skills and knowledge about the business thus the organization could end up losing such expertise to competitors reducing business performance.
It is often said that theory must be applied hence losing about 10 managers could imply loss of much needed expertise and knowledge acquired through experience. For example, a well-seasoned manager or employee understands how to handle difficult customers something which is not taught in schools.
Delayering should be approached with caution since the organization may end up axing the right managers while retaining poor ones or some of the 10 managers could possess expert power and people power such that we they leave, the remaining employees could be demoralized and organization lose the much needed knowledge to remain competitive.
In addition, increasing span of control for the CEO and the remaining

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