Kudler Fine Foods - Organizational Behavior

Introduction

Kudler Fine Foods (KFF) is an entrepreneurial company with a successful formula. Expansion is very much in their plans. In order to grow successfully, founder and President Kathy Kudler will need to work with her management team to build on their strengths, identify and resolve weaknesses, and ensure that the successful formula they have nurtured to this point will survive and grow with the company.

Organizational Culture

The apparent culture at KFF is one of independence stemming from founder, Kathy Kudler. In our text, this would be described as employee self management. (Gomez-Mejia & Balkin, 2002, ch. 5, p.2) Kudler played a major role in financing and growing this specialty food company on her own. Kudler was able to fund the business for 6 months as well as expand it to two other San Diego locations in a short amount of time. Kathy's direction promotes a culture that is team oriented yet flexible. KFF delegated tasks such as management, stock, sales, inventory, and accounting to employees with adequate training and made that their sole responsibility. This allows an employee the chance to make the job his or her own and feel as if their position is of value. The text states that in an employee self managed organization, duties and responsibilities are well defined and employees can function without close supervision. (Gomez-Mejia & Balkin, 2002, ch. 5) This is an important aspect of a KFF employee; with three locations throughout the San Diego area, Kathy cannot physically be at each location at all times. The culture is one of self sufficiency and leadership is highly promoted as well.

In exploring the visible culture within KFF, it becomes evident the organization holds a very open environment. Kathy Kudler does not seem to be an employer who has a major emphasis on power, as she accepts suggestions and is open to new things. (Gomez-Mejia & Balkin, 2002, ch. 5, p.2) A good example of this openness to new ideas is the openness to intern Tara Emillio's development of a business plan for KFF. Many businessmen would be afraid to trust this important document to a college student. However, Kathy's entrepreneurial savvy saw this as an opportunity to seize a detailed plan for KFF as apart of Tara's project.

Organizational Structure

“Organizational structure is a formal system of relationships that determine lines of authority (who reports to whom) and the tasks assigned to individuals and units (who does the task and with which department).” (Balkin, D. & Gomez-Mejia, L., 2002) With defining what an organizational structure is, it must be determined if the organizational structure of KFF is ready for change. In any company’s move to make changes within the organization, the structure of the company’s human resources from upper level management to the part-time worker must be taken into serious consideration, because if the behaviors must change the organizational structure may have to change as well. The organizational structure of KFF is a very important element of the company’s functionality and its readiness for change.

Using the organizational chart from the intranet, the formal structure of KFF’s organization combines vertical and horizontal dimensions. The reporting line designates who is the authority figure is, the decisions they make and who they supervise throughout the company. The reporting relationships are also broken down by department. Several elements assist in characterizing the Kudler structure as being centralized. “Centralization means that decision authority is located at the top of the organization hierarchy.”(Balkin, D. & Gomez-Mejia, L., 2002) A centralized format of decision making is effective with coordinating tasks consistently among the different supervisors and employees throughout the company. Less concern is given to multiple goals or ideas being passed down among the chain of command in the company. Changing the company may be much more effective because the decision making is consistent to the different supervisors, but decentralization should be considered due to its ability to provide greater flexibility and responsiveness to change.

The organizational structure of KFF can be viewed as a “Functional Structured” model. The functional structured organization “clusters people with similar skills in a department.”(Balkin, D. & Gomez-Mejia, L., 2002) KFF is organized in such a manner, with department heads overseeing their corresponding departments. According to the text a functional structure is a more suitable for small or medium-sized businesses that operate in stable environments without huge change and uncertainty. The functional structure will be good for KFF since the target consumers are more affluent and can afford high quality domestic and international food products; hence the current structure is still effective. As stated, KFF employs a centralized decision making system within a functionally structured organization with power centralized at the top of the hierarchy. The company will remain effective since the employees are separated into their specialized areas, where they can focus on their work and having their efforts combined with others doing their specialized tasks; creating efficiency in doing business with consumers, other businesses, finances, and coordination of the stores and company operations.

Leadership Style

Leadership style is the manner and approach of providing direction, implementing plans, and motivating people. Three styles of leadership are reviewed: Authoritarian or Autocratic; Participative or Democratic; Delegative or Free Reign (Clark, 1997). Leaders who use the autocratic style make their own decisions and announce them as a done deal. A democratic leader actively tries to solicit the input of subordinates, often requiring consensus or a majority vote before making a final decision. (Gomez-Mejia and Balkin, 2002) Kudler Fine Food’s business strategy of using a democratic leadership style to manage organizational performance has made them a flourishing company. Kudler incorporates employees’ thoughts and ideals to make the company successful; encouraging employees and supervisors to discuss job performance and goals on an informal, day-to-day basis. Additionally, employees and supervisors have formal performance evaluations, discussing work and goals, identifying and