ORGANIZATIONALSTRUCTURE

SUBMITED TO: SUBMITED BY:

SIR NAVEED AHMED MEHREEN AHMED AREEBA BATOOL

REHAN SHAFIQ

TABLE OF CONTENTS

Acknowledgement Introduction History Shangrilla private limited Nature of business activity Present situation Plant outline Board of directors Corporate philosophy Business philosophy Mission Core values Objectives and Goals Shangrilla Organizational Structure Work specialization Departmentalization Chain Of Command Span Of Control Centralization Formalization Organizational Structure Of Shangrilla Mechanistic Organization

ACKNOWLEDGEMENT

DATE: 27TH May 2008

Dear Reader,

We are thankful to our teacher, Sir Naveed Ahmed of BAHRIA UNIVERSITY KARACHI Campus for his valuable guidance and encouragement. His directions have certainly helped us in completing this report in time.

We would like to thank all the people who have made it possible for us to prepare this report. They guided us through the whole journey of writing this report, from collecting of information till writing of the main report. It was because of their immense support, that we have been able to successfully complete this report.

INTRODUCTION

Shangrilla Private Limited is the subsidiary of Young’s food products, founded in 1988.It is now producing seasoning sauces of different flavors to add taste in continental foods.

Shangrilla came into being a year ago when Young’s group split into two, the Young’s food and the Shangrilla private limited.

HISTORY

Young’s group started its operations in 1988 under the title of “Marketing Paradise” with the launch of French Mayonnaise in the Pakistan Market.

In the beginning it introduced Mayonnaise, Soy Sauce, Chilli Sauce and Vinegar. The first ever commercially produced and distributed Chicken Spread was launched in 1989. The Young's brand family continued to grow with the introduction of Sandwich Spread, Chocolate Spread.

Over the years the portfolio is extended gradually under two brands FrenchFrench for Mayonnaise based products & ShangrilaShangrila for the condiments range.

The Group now runs two separate companies naming Young’s (Private) Limited & Shangrilla (Private) Limited.

Both the companies maintain a leadership position in the categories of their existence and are highly acknowledged both locally and internationally

SHANGRILLA PRIVATE LIMITED

NATURE OF BUSINESE ACTIVITY:

Shangrila (Private) Limited as the subsidiary of Young’s Group - the leading national company engaged in production and marketing of food products.PRESENT SITUATION:

Shangrilla brand has also proved its dynamism with the launch of Tomato Ketchup and whole range of Pickle in oil. Today we enjoy brand leadership and a strong distribution network across 125 towns in Pakistan. It also has presence in Bangladesh, Oceania, The GCC Region, Africa, Europe and North America.

SHANGRILLA PLANT OUTLINELocation: Karachi Pakistan

Covered Area Facilities: Over 100,000 square feet

Number of Employees: 350 approx.

Headquarter : Bahadurabad, Karachi, Pakistan.

Shangrilla’s Product Range: Tomato ketchup, Chili Garlic Sauce, Ginger Sauce, Soya Sauce, Chilli Sauce, Vinegar e.t.c

Slogan: “Add taste to life”

Address: 293/16Block3,B.Y.J.C.H.S, Bahadurabad, Karachi (Pakistan).

BOARD OF DIRECTORS:

MR.MANSOOR AHMED CEOMR.MUNIR AHMED Director MarketingMR.SOHAIL AHMED Director finance

MR.YOUNAS AHMED Director production

CORPORATE PHILOSOPHY:

Shangrila (Private) Limited is committed to deliver the consumers with high quality food products of global standards catering to local tastes and convenience.

BUSINESS PHILOSIPHY:

To enhance the product portfolio with national and international brands, which meet the company standards and maximize the network potentials with increased efficiency, greater coverage and effective customer services.

MISSION:

To represent the fast-paced lifestyles that demand convenience of usage, energy of wholesome natural ingredients, great taste and quick serving all in one food item and to represent a range of tantalizing and mouth watering spreads for everyone.

CORE VALUES:

Customer   Focus:

Relentless focus on understanding and fulfilling

customer needs through superior service.

Integrity:

Honesty to the organization and oneself with

relationships based on mutual trust and openness.

Teamwork:

Willingness to share the glory of achievements as

well as responsibility for failure.

Humility:

Display self-belief as well as modesty and be

respectful to all customers, colleagues and business

partners.

GOALS AND OBJECTIVES:

Build profitable customer relationships by creating environmentally better products and getting them to market faster at lower cost, earning profits and maintaining customer relationship.

Building & maintaining customer relationship Give better products to customer & satisfaction

from it. Earning profits. Capturing value in return from the customer.

Organization design is a important factor for shangrilla, as it is growing organization in the food industry, many efficient employees are working under the brand of shangrilla, there business started 20 years back in 1988 by the name of “marketing paradise” with the launch of French Mayonnaise by four brothers, Mansoor Ahmed, Munir Ahmed, Sohail Ahmed and Younis Ahmed.Now Young’s group have two divisions namely Young’s food and Shangrilla one-year back this division took place functionally.Young’s food main products are mayonnaise chicken spread and different kinds of spreads, and shangrilla mainly distributes ketchup, pickle, Soya sauce, vinegar and much more.

As shangrilla is an old organization it is still working in the traditional style.

ELEMENTS OF ORGANIZATIONAL STRUCTURE

The senior manager of the SHANGRILLA foods said that:

“Organization structure gives working boundaries to employees. Good organization structure provide much information to the

employees in order to do their respective jobs efficiently.”

The manager also mentioned that Shangrilla’s organization structure based on the following key elements: Work specialization Departmentalization Chain of command Span of control Centralization

WORK SPECIALIZATION:

The top manager of Shangrilla foods believes in work specialization and division of labor. He said:

“We are following Adam Smith’s philosophy of work specialization and division of labor since our beginning.”

Shangrilla foods consider work specialization as a very important element for good organization structure because by this each employee can produce efficient output. In the making of their best selling product “ketchup”, the pulp of tomato is make by a special person, the flavor is add by another specialized person and the recipe is finalize by other special person.

DEPARTMENTALIZATION:

There are five forms of departments.1. Functional departmentalization.2. Product departmentalization.3. Geographical departmentalization.4. Process departmentalization

Shangrilla’s manager said about their departmentalization:

“Our jobs are grouped together on the bases of functions we perform”

Shangrilla foods follow functional departmentalization. They have:

Product department Sales & Marketing department Human Resources department Accounting department IT department

CHAIN OF COMMAND:

Shangrilla’s chain of command starts from top management to the lower level of management. Being a traditional organization it follows:

AUTHORITY: The manager of Shangrilla foods has the authority to order their peoples what to do and what to do not.

RESPONSIBILILTY: The employees of Shangrilla foods take the orders of their managers as the obligation to perform their duties and they also feels the sense of responsibility to perform well.

UNITY OF COMMAND: Unity of command also exists in Shangrilla. Each employee in the company reports its own manager.

SPAN OF CONTROL:

Director Marketing & Sales

GM Sales

Sales Manager

Regional Manager

Zonal Manager

Area Manager

Media Manager

Sales Executive

Booking Rep

Sales Operation ManagerSales Operation Manager

Marketing Services Team

Although Shangrilla foods is a small organization but it has wider span of control. Approximately it has 10 to 12 managers and each manager is controlling approximately 35 to 40 employees. Its wider span of control helps it to generate more profit as it has low number of managers so the company saves management salaries.

CENTRALIZATION:

Centralization exist very much in Shangrilla foods, decision making is concentrated at a single point at high rate at shangrilla .Its top management makes decisions with no inputs from lower management and employees due to which the environment of the organization remain stable.

FORMALIZATION:

Shangrilla has strict rules and regulations. They have highly formalized structure. Every job is assigned is to the employees and taken care that it should be performed according to the policies.

Organizational structure of Shangrilla

• Mechanistic organization• Contingency Factors

Mechanistic organizationA rigid and tightly controlled structure will be called a mechanistic organization

o The Shangri-La (Pvt) Ltd. Has a very strong mechanistic design but no organization is completely mechanistic so the company also follows few organic characteristics.

o High specialization

The Shangrila (Pvt) Ltd. Being a mechanistic organization has a specialized departmental system. It has highly specialized departments such as Media and Creative,

quality, production, HR department Etc.

o Rigid departmentalization:

Shangrilla have very rigid departmentalization. Every job is assigned to different departments according to their specialization. As the organization follow a functional design.

o Wider span of control

The company has a wider span system and that’s why they have an effective and efficient employees network.

o High formalization

Shangrila (Pvt) Ltd. Has a very high formalized network which means that they carry out lot of paper work and rules and regulations are also clearly defined and are followed in the organization

o Limited information network

The Company follows a downward communication network in making a decision but some suggestions are observed which are given by the lower staff or employees

o Low decision participation

Employees are involved in the decision making process but the final decision depends on the upper managing staff whether they want to include the decision of the lower staff or not.

Factor of organic structure followed by Shangrilla.

Open communication is done among the lower staff and the middle and upper staff because strong communication is a key to success for any organization and

this communication network is followed in Shangrilla

Contingency Factors

Overall strategy of the organization

o Strategy is very important factor for every organization, first the strategy is planned then the structure is designed.

The Shangrila (Pvt) Ltd. Firstly started the organization as a organic organization but later on they grew with there strategies and adapted the mechanistic organization strategies as the organization started with a single product and now they have more than 9 products in a particular product line. They are following the stability strategy.

Size of the organization

o Firms change from organic to mechanistic organizations as they grow in size

The Shangrila (Pvt) Ltd. Started the business on a smaller scale but later on after the passage of time they turned the organization into a large scale. They started the business with 15 employees and now they have more than 300 employees working in the organization.

First Young’s company was a single company then it divided in to two groups namely Young’s and Shangrilla.

Technology use by the organizationo Firms adapt their structure to the

technology they use

ortant for every organization to use the technology to its best extent in order to become a highly successful organization Here Shangrila follows an upgrade system of machinery and technology.

Degree of environmental uncertaintyo Dynamic environments require organic

structures; mechanistic structures need stable environments

An organization has to be very adaptive in order to minimize environmental uncertainties.

Shangrilla is very less adaptive to Envoirment changes one of its example is they still use print media for advertisements and promotion.

Shangrilla’s Organization Design

Shangrilla organizational design is traditional and mechanistic. As their organization goal is to provide “highest quality food product”, to achieve this goal they have adapted the traditional style of organization designing.

According to the Marketing manager of shangrilla

“Organization frame is very important and they give it great importance”.

Traditional DesignShangrilla like other firms started at the lower level with a simpler structure, with little numbers of employees.As the organization started to grow they adapted the functional structure.

Functional structureShangrilla is divided in to different departmentso Production departmento Quality departmento Sales departmento Finance departmento Marketing department

Each department has its own manger and grouping the people together who are specialist in their job makes these departments. They believe that every person should do for what he is assigned for.

CEOCEO

Dir MktDir Mkt Dir FinDir Fin Dir ProdDir Prod

NSMNSM A/c MgrA/c Mgr Plant MgrPlant MgrMrkt HeadMrkt Head IT MgrIT Mgr Qlty MgrQlty Mgr

Sales forceSales force

Sales OprtnSales Oprtn

ATL SecATL Sec

BTL SecBTL Sec

HR MgrHR Mgr

ORGANOGRAM OF SHANGRILLA PRIVATE LIMITED

Co-ordination between departmentsShangrilla follows a certain process for saleso Secondary saleso Primary sales

Secondary sales:The process of sales from distributor to the shop is called secondary sales.In order to make secondary scale more effective and fast two departments, sales and marketing department work together.

Primary sales:The process of product availability from the company to the distributor is called secondary sales. This process is completed by the co-ordination of three departments, production, quality, and finance

By these processes it is obvious that each respective department do their assigned job by the co-ordination of departments.

This type of structure has both strengths and weakness.

Strengths of Shangrilla’s organizational designo Faster decision makingo Cost savingo Grouping of people who have similar jobs and

task make the work easier and simple

Weakness of Shangrilla’s organizational designo Less adoption of changing Envoirment for e.g.

they haven’t been into electronic media for promotion of their products.

o Functional specialists are insulated, they don’t think out of the box, which is requirement of changing Envoirment.

After the survey of shangrilla organization we got to know that it is not a learning organization and because of which their growth is very slow they are not sensitive to changes.