Capco's Organizational Structure Case Study

Capco employs a flat rather than a tall organizational structure. Tall organization structures were commonplace in the twentieth century as businesses expanded. Traditional tall structures are characterized by bureaucracy and long chains of command. There are many layers through which information passes through. These structures also have a narrow span of control. Capco, an innovative company in a competitive environment, chose a few layers of command and a wide span of control. Information flows much faster in this type of structure. A flat structure fits Capco's strategies to create an environment that encourages entrepreneurship. Entrepreneurship promotes innovation through motivating and providing all employees with access to information through activities such as coaching and mentorship.

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Capco's structure takes an organic rather than a mechanistic structure. In an organic structure, most communication paths are horizontal. Specialization is limited as knowledge is concentrated where it is most useful. Capco's structure is also decentralized as there is informal as well as formal participation in the decision-making process. Employees work in groups, and they provide inputs on various tasks. Employees also communicate openly with managers and executives. Communication is more verbal and face-to-face than in mechanistic organizations.

Teams are created d by a group of people with a common purpose. Formal teams are formed through channels that may not involve team members. For instance, a manager may create a team from their subordinates without involving them. This may create a barrier to team effectiveness, given the team members may not be fully committed to the team's objectives. When team members are not well-informed on their specific roles in the team, their contribution, and therefore the team's productivity, may be below the required level. Open communication is consequently one of the ways to promote team effectiveness by identifying issues and developing ways to address these issues. A team's effectiveness in achieving its objectives can also be hurt by the improper composition of the team. When creating a team, diversity presents the best option to leverage the strengths of different people. A diverse team is also likely to be creative enough to offer a variety of intuitive approaches to problems.

Capco's organizational structure influences not only its strategies but also its knowledge management, employee engagement system, and its leadership style. Capco employs a flat organizational structure with the matrix structure also adopted for projects. The flat structure removes the hierarchy associated with varying levels of authority. All employees feel involved in the decision-making process, given their input is appreciated as it is encouraged. Knowledge is shared widely with little restrictions to reduce information asymmetry associated with flawed decisions. Employees' feedback and creativity are also encouraged and rewarded in an attempt to maintain highly engaged employees. Capco prefers a bottom-up leadership structure where the inputs of all employees are valued equally. Constructive criticisms, feedback, as well as suggestions, are encouraged by creating horizontal communication channels. Capco's structure creates an opportunity for all employees to thrive by aligning their interests with those of the company. Employees are nurtured through continuous learning and developing human capital development models that identify employees as assets crucial to the sustainability of the business. Capco's structure is short and has a wide span of control. It is, therefore, more cost-efficient than a tall structure with a narrow span of control. The daily operations at Capco are supported by this organizational structure that promotes faster decision-making, effective communication, and creates a sense of ownership among the employees.