It’s started operation after World War 2, importing motorcycles from one of the establish Japanese company into Singapore and selling it in local market, its started off by selling bicycles until this Japanese Company invented motorcycle in the 1971, from then on motorcycle, was it sole product selling in Singapore. Moran Kiosk Yang, the founded of this company has 3 sons. Today, taking over the business is Mr. Tan 3rd son – Mr. Tan Chon Way, Chief Director of Ghee Hoe.
Ghee Hoe, a family business, consists of Mr. Tan, his sons, his grandchildren and a few workers helping out in the company. Ghee Hoe – Vision & Mission Vision – Excellence in all respects Mission – Our mission to realize this vision is: to provide automobile of international quality at competitive price. To improve skills of valued employees by imparting training and inculcating in them a sense of participation. To make valuable contribution to social development of Singapore through development of industry in general and automobile industry in particular.
Early day Organization Structure In early day, Ghee Hoe business were good, due to the invented of new design motorcycle also in comparison to a normal low maintain car that need o pay CEO for consumer in Singapore, motorcycle is more affordable for people who needed own transport. Beside importing in Motorcycles, in order to promote it product – Ghee Hoe, do registration service for customer who purchase its brand of motorcycle, meaning customer who bought Ghee Hoe motorcycle will have every necessary relevant paper work done by Ghee Hoe in one price.
The next day, customers just come into the shop to collect the purchase motorcycle and within that day this purchase motorcycle can be ride on the road. This buy and take services is much more attractive than archiving a car, which has to take up a few weeks waiting for bank loan approval. With the growing of business, Ghee Hoe increase labor need in its company, to meet the demand. Annex 1 shows the organization chart of this family business. Decrease in Demand Year 2000, Economic of Singapore was good, consumer purchasing power grew stronger with price of CEO drop, this is a golden opportunity for people who wanted to own a car.
Motorcycles, a two wheel transport, which has lower protection for rider in compare to car can be a disaster that could causes death on the road shows a slow drop in demand. Singapore – is a small market, and with the strong competitor of different brand of motorcycle in the market, this drop in demand could actually affect Ghee Hoe. In a year, Ghee Hoe income has shown a drop in half compare to 1997. Ghee Hoe starts to Re-Structure its organization charts in order to achieve its goals.
Re- Organization Structure of Ghee Hoe Basically, top management and middle management level remain the same, the re-structure are mainly the non-managerial staffs. Annex 2 shows Ghee Hoe re-organization Charts. Key personnel: Chief Director: Tan Chon Way (Tan Kiosk Yang 3rd son) Director: Tan E Sheen (Chon Way elder brother, only son) Director: Tan E Man (Chon Way second brother, elder son) Marketing Manager: Robert Tan (Tan Kiosk Yang brother, youngest son) Spare Part Manager: May Tan (Chon Way elder brother, 2nd daughter) 1 Organization structure is a hierarchical arrangement of lines of authority, communications, rights and duties.
This structure decided on how the roles, power, responsibilities of each and every individual are assigned to controlled and coordinated the flows of information between the different level in a management. We used organizational chart to illustrates the organizational Truckee in showing the different levels of management. The 3 core dimensions of an organization structure are -? Complexity, Centralization and Formalization. Complexity Garret R (2010) define “Organizational complexity, the number Of different function and divisions possessed by an organization, determining the level of differentiation,. In this organizational structure, differentiation is high. Basically there are 2 types of differentiation-? Vertical and Horizontal also known as Tall & Flat Structure. Vertical differentiation, the way an organization designs its hierarchy of authority and creates reporting legislations to connect organizational roles and subunits. Lower levels report to higher levels. In Ghee Hoe, Mechanic is to report to workshop foreman and foreman is to report to Manager and Manager is to report to Chief Director (the man who has the most power and authority).
Horizontal differentiation, the way an organization groups organizational tasks into roles, and roles into subunits, establishing the division of labor. In Ghee Hoe, the spare part and workshop function made up a spare part division provide services to customer who need services to their motorcycle. Whereas the Receptionist, Registration assistant and Sale personnel function made up a marketing division provide services to first time customer who wanted to know more and to purchase motorcycle. Centralization Stephen & Timothy (2012, up. 30) refer that “Centralization, the degree to which decision making is focus at a single point in the organization, where top management make all the decisions, and lower-level mangers merely carry out their directives. ” In Ghee Hoe, all important decisions are made by Mr. Tan Chon Way, whereby the other 2 director is to give him opinion and in supporting his decision. The lower management level will just carry out his instruction. Recruiting of new employees is determined by the top management. Stephen & Timothy (2012, up. 30) refer that ” In Decentralization, decision making is delegated to the manager who is closest to the action. ” Although Ghee Hoe, is not a large organization, it has an organic structures that given certain authority to employee in handling day to day matters. Like the prices of a motorcycle spare parts, Ghee Hoe store assistant could give a special offer for regular customer. Formalization Stephen & Timothy (201 2, up. 30) refer “Formalization to the degree to which jobs within the organization are standardized, in using rules and procedures to guide behavior of employees. In Ghee Hoe, should an employee report late, he or her salaries are to be deducted. Certain rule and regulation like revealing too much UN-relevant information to outsider will be heavily penalize. Mechanic is to also to follow the standardized of safety rule from the MOM, like wearing a mask during the inspection of motorcycle is to be follow closely, failure to obey will be a punishment of fine of SSI 0 depending on the seriousness of misdeed.
Measuring Ghee Hoe organizational effectiveness The measurement Of an organizational effectiveness in which whether an organization is able to meet its goal, and how well its net profitable is in by comparing it to its target goal, the growing data and the results of its customer satisfaction surveys. – 3 approach in measuring organizational effectiveness – External resource, Internal resource and Technical. External Resource Approach According to Garret (2010) External Resource approach means “Use technology to increase its ability to customize products or improve products’ laity and reliability increases organization’s effectiveness. Ghee Hoe, Motor-yeses business has been going downhill, although its carry a popular brand around the world. Its Japanese company has tried to improve the external resource approach, by modified the Motorcycles in different requirement cater to different market segmentation, to make it more user friendly for all age group. Internal Resource Approach According to Garret (201 0, IPPP) Internal Resource approach means “Evaluates the organization’s ability to be innovative and function quickly and responsively.
Ghee Hoe is not a large organization, but conflict among the internal is high, maybe due to different opinion, unhappiness of certain family member among the management level. Decision making take long time as Ghee Hoe is more to Centralization Structure whereby any important decided has to wait for the approval from the top management. Coordination and motivation of employee is poor, example if the sale person is on leave, Customer have any query, they have to wait till this employee return to work the next day to answer customer query, even simple question like the capacity of one particular model.
Technology Approach According to Garret (2010) in Technology approach means ” Uses technology to improve efficiency and quality while reducing costs. ” Ghee Hoe, technology is not advanced, some of the company record are still done manually, and not computerize. Reason could be due to the knowledge of employee, as some still do not know how to operation a computer. Maybe Ghee Hoe is not a large organization, the used of advance technology might not be necessary.
Recommendation of Approaches to Improve Ghee Hoe Organizational effectiveness In External Resource -? Improve products quality, as motorcycle re mostly imported from Japan. It is also a limit of what Ghee Hoe can achieve in this area, but Ghee Hoe can try importing in more different design of motorcycle to attract local consumer, also to give more feedback to the Japanese counter in developing the core competences of motorcycle for Ghee Hoe in making it more competitive.
In Internal Resource – Reduce conflict, Ghee Hoe is a family business, sometime in order not to create unhappiness among some of the member of the management, manager tend to filtering information, this filtering of information will create another member to be unhappy, and conflict arise and when this happen employees will divided into 2 group. This internal problem can resolve should manager be more truthful.
Currently, when a departments needs to recruit new employee, first they have to get approval from the top management and if it is approval, top management will personally interview the candidate and this take months, maybe top management can paid more attention in others more important matters while this can delegate to the respective department in charge. Train up employees to handle each other duties, so that when one party need to aka leave, the other can take over should any matters arise and not wait for that individual to come back from leave, this could actually speed up the process of duty.
In Technology – Train up some of it employees to access computer. Sometime some manual recording can take up a day and this can actually reduce the productivities. Try slowly computerize some of it record taking, slowly let employees adopts to the changes as Technology influence structure and with good structure will influence organization effectiveness. Ghee Hoe Co has a long history, and still going strong. Establish, after World War 2, and till today. Ghee Hoe is a family business and the employee working there are majority the older generation, therefore it is not an easily task in changing the culture of this organization.
But in order to keep up with the growing market, advance technology and culture. Organization change is necessary in order to increase its effectiveness. Ghee Hoe has to change its culture and structure, by bring in more new generation, and train up its old workers. There are younger generations in the company but most of it is the non-managerial staff, doing the technical work while the upper management are mostly at the age of ass to ass. Should Ghee Hoe continue to retain its current state, it will not achieve much.
Ghee Hoe current situation, shows a decline in sales and profit, if this continue, lay-off of employees will soon take place. This decline of sales and profit is the consequences of poor organizational design. In an organization, organizational design is important in helping a company to deal with contingencies, to achieve competitive advantage, to manage diversity and to increase efficiency and ability to innovate goods and services.