Flight Centre Case Study

Topics: Organization, Structure, Organizational studies Pages: 10 (2676 words) Published: April 17, 2010
Flight Centre

Graham Turner structured the company as families, villages and tribes. The creation of this unique system has also worked to the company抯 advantage. It provides incentives based on outcomes. The Flight centre抯 system is based on the idea that people work best in their preferred environment within the larger organisation rather than trying to fit them into the company抯 mould. The employees believe 憌hat gets rewarded gets done.?they are hard workers but also enjoy the many social aspects of the company including buzz nights, award ceremonies and team get-togethers.

This essay would focus on how flight centre has structured with the four aspects of the organisation structure. Explains how flight centre has integrated the Mintzberg抯 five elements to its structure. This essay would also highlights the roles of functional and social specialization. Finally, the metaphors used by flight centre would be discussed.

Structure of Flight Centre
The importance of organisational structuring and restructuring to organisational effectiveness cannot be over emphasized. Effective organisational design or organisational structuring pays immense dividends, no matter how large or small the organisation is (HRODC , 2006). The founder of the Flight Centre Ltd, Graham Turner claims that people are hard wired to work in small groups within larger groups. To understand this unique structure the four aspects of organisation structure, complexity, formalization, centralization and coordination, can be used.

Complexity refers to the way in which the organization is divided into different divisions, departments, groups, or individual roles, each with its own tasks and responsibilities. Vertical differentiation refers to the number of hierarchical levels in an organization (Robbins & Barnwell, 2006). At the Flight centre, the operation level involves retail shops. Each shop involves three to seven people working on one brand which is called a family. The area or a 憊illage?involves 7 or 10 families within one geographical region. The tribal country is a set of three or four villages. Each tribe is a different brand, brands include corporate traveler, flight centre and student flights (refer appendix 1).

In horizontal differentiation, different parts of the organization become specialized in different activities to increase efficiency (Robbins & Barnwell, 2006). All shops of flight centre sell similar services even though the names (corporate traveler, flight centre and student flights) are different which makes it easy to coordinate activities and to communicate among families. Moreover, due to the similarities of jobs within a family, there are no differences between the staff. However, a special horizontal clustered family consisting of HR, IT and marketing professionals, provides administrative services for retail shops. By clustering different types of functions and activities on any one level of the hierarchy has the advantage of application of higher technical knowledge for solving problems and greater group and professional identification (Luthans, 1986).

Flight centre has more than 800 shops spatially dispersed. High-rise of overseas shops would increase the number of tribes, villages, families and employees. As a result, it would be difficult to communicate, coordinate and control. According to Baumard & Starbuck (2006), the members of spatially dispersed organizations seek appreciation within networks of friends and relatives, and they form subcultures that spread across several organizations and that may be more important to them than their focal organization. These communities encompass more aspects of their lives than the strict duties of their work contracts so work and leisure infiltrate each other.

Formalization refers to the extent to which rules, regulations, job descriptions, policies, and procedures govern the operation of an organization. (Robbins & Barnwell, 2006).Although the flight centre...
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