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Organisational Structures and Communication

This resource is designed specifically for Unit 2 of the Edexcel BTEC National qualification, 'Business and Management'.

Aim:

The aim of this resource is to develop your understanding of communication within organisations. By the end, you should be able to:

  • Identify some of the key aspects of business communication
  • Understand the effects of decentralising organisational structures
  • Identify the main channels of communication
  • Apply the theory to a practical business situation

Resources:

Activity:

When plans for future company growth go wrong and the competition is catching up fast, what should a business do? In a retailing firm, many would expect costs to be cut - involving shop closures and staff redundancies. But does this also represent an opportunity? Let's consider the example of Boots.

Boots

Boots were already under threat from the Office of Fair Trading's (OFT) decision to allow supermarkets to compete more effectively in over-the-counter pharmacy sales. See our 'Wanna Argument?' on this issue - Drugs, Big Business and Community Service. (http://www.bized.co.uk/current/argument/arg9.htm)

Next, the company faced the failure of many of its attempts to boost market share and diversify into new higher margin areas of business. Boots' 'Well Being' and 'Pure Beauty' concepts were ditched, as the firm began to concentrate on its core activity - chemist shops. See the BBC article, Boots rethink costs jobs, for more. (http://news.bbc.co.uk/1/hi/business/2890945.stm)

A Boots' store

And then, the company's Chief Executive, Richard Baker, started to wield the knife at Boots' headquarters in Nottingham. Five hundred jobs were to go as part of a restructuring plan. Mr Baker, who arrived at the famous High Street store from Asda in September 2002, was understood to want a slimmed-down leadership team. He also axed two directors (in charge of Personnel and Marketing) in October 2003.

Quoted in an article in The Guardian, New Boots chief starts by cutting from the top, Mr Baker said "The smaller executive team will help us speed up the progress we are already making on refocusing and re-energising our business". (http://www.guardian.co.uk/business/story/0,3604,1072834,00.html)


Task:

The following paragraph describes the likely impact of the Boots' restructuring. But many of the key words or phrases are missing. Your task is to decide which word or phrase belongs where. Type in your answer to fill the gaps:

You can also view this as a print version.

In July 2006, Boots announced the successful merger with its largest competitor, Alliance Unichem, in a £7 billion deal. The combined company, known as Alliance Boots, will command annual sales of around £13 billion. Boots and Alliance Unichem estimate that the merger will lead to savings of £100 million per year. Boots say that about 1,000 jobs will be lost as a result of the merger. Alliance Boots will become one of Europe's largest drugs, healthcare and beauty products groups.