Walton Hi Tech industries Ltd: Overview of the Organization Structure

The purpose of this report is to provide an overview of the organization structure, and the goals and objectives of the chosen company and see how that structure plays a part in the formulation of strategies which aid to achieve those goals and objectives.

1.1 Introduction

The organization that has been chosen for this report is Walton Hi Tech industries Ltd( Walton HIL). Walton is a Bangladeshi manufacturing industry that specializes in the production of smartphones, home appliances, LED television sets, Generators, microwave ovens, refrigerators, cooking utilities, air conditioners, Dvd players, and motorcycles for the local Bangladeshi market, as well as the south Asian market. The company has a strong research and development division and the latest manufacturing techniques and equipment for which, the products are of a high quality, but also at a very competitive price point.

1.2 Organization goals and objectives of Walton

The ultimate goal of Walton HIL Ltd is to take its place among the top consumer electronics, Automobile, and home appliance industries in the world by 2015. Previously, it had been thought that consumer products made in Bangladesh cannot be of a quality that is good. Walton has made tremendous efforts to make sure that this type of a perception could be scrapped from the minds of people, thereby giving them confidence in their products. The following are the objectives of Walton HIL Ltd:

To push the boundaries of innovation and to shape the future- foster creativity to turn people’s imaginations into reality and envision technologies that are one step further. To enhance the company value and open up new business opportunities- Walton strives to build a strong brand name image both in the local market and the International market. The profitable growth that it sustains makes the company a prime investment for shareholders.

Empowering the people in the organization to achieve world class performance- Walton considers its people as the core of the organization and its competitive advantage. Respect towards the employees and open communication ensures that they give their best efforts and work hard to achieve excellence. To enter into the U.S and E.U market by 2015- Walton aims to expand its reach into the U.S and E.U markets by creating international brands that get a maximum price in those markets. 1.3 Organization structure of Walton:

From the information I gathered from the website of the company, it is evident that Walton has a product based organization structure. The Company’s efforts are centered around its main products, and extending their reach to other markets abroad. Employees from departments like Sales, Marketing, Finance, operations, and so on, report to the vice president supervising the production of a specific product. For example, the finance, operation, marketing, and sales departments reporting to the vice president handling the production of Motorcycles.

All the vice presidents handling the operations of each product line will report directly to the CEO of the company. This type of organization structure has some advantages, as well as some disadvantages. The Advantages are: More focus on products and customers- the focus on products and customers ensures that quality products are made, which deliver satisfaction to the customers It is easier to evaluate the performance of the product.

Product responsiveness to market changes from time to time. So it is possible to know whether the product has been successful in the market or not. There is less of a burden on the CEO, to make operating decisions. The disadvantages of this type of structure are:

There may be limitations on the economies of scale achieved as, companies with such an organization structure may not have yet expanded to other major potential international markets such as, Europe and America. There tends to be multiple product groups. So it may be difficult to choose between those groups. Conflicts can arise between the product groups and the corporate objectives.

1.4 How the Organization structure of Walton helps to formulate strategies

Formulating corporate strategies for a company requires analyzing the industry or environmental conditions in which the company operates. Assessing the strengths, weaknesses, opportunities, and threats of a company is also important. The proper analysis of these factors will greatly determine whether the strategies formulated will be successful or not. The product based organization structure of Walton means that greater emphasis is given on the products of the company, and customer satisfaction.

So therefore, the structure will tend to fuel the need for more research and development and analysis which will give the company a competitive advantage over its rivals. In order to do so, a company has to either differentiate its products from the competition and set a premium price justifying the ‘uniqueness’ of the products, or offer products at a low and attractive price that still meets the quality standards. Walton primarily aims to offer products at a reasonable price point that are of a high quality.

So the tendency to put the customer’s needs and requirements at a top priority helps the company design and manufacture products that not only has high demand in the local market, but also maintains a high amount of export value in foreign countries. A SWOT analysis of Walton can illustrate the competitive advantages or disadvantages that are present within the company, and furthermore examine how the objectives can be achieved.

The strengths of the company are:
Walton is the only company in Bangladesh that diversifies production in multiple industries. Other local competitors of Walton only concentrate production on mainly smartphones and mobile phones. Walton has achieved various stringent quality standards certificates, which puts the company above the competition in terms of quality control.

The Smartphones

manufactured by Walton carry a price that is very competitive and at the same time offers a wealth of features. So they can compete quite well with even some of the biggest players in the mobile phone industry, just because of the price point. Walton has the latest machines and testing equipment in its production plant, including 3D printers, which allows rapid prototype models to be made. The weaknesses of Walton are:

There may be too many products for the company to manufacture. While Walton manufactures the latest LED television sets, they are also producing the old CRT television sets which basically is almost phased out, and in not much demand. Walton may be a bit too late in considering to step into the pc market as, it is already saturated with lots of chinese pc makers and other premium pc manufacturers which may prove to be quite some tough competition to deal with. The opportunities of Walton are:

Walton has a clear chance and opportunity to enter into the E.U and U.S markets by 2015. Those are very potential markets for Walton which can increase their export revenue by a mile. If Walton can shift production from motorcycles to cars, it could open up yet another huge potential market for the company. An entry level smartphone can be manufactured by the company to increase the sales of the Walton Primo brand.

The following are the threats of Walton:

Increasing pressure from other competitors, particularly the Indian motorbike manufacturers like Bajaj, and Hero Honda, who are leading the motorbike industry. Walton still hasn’t built up a brand image for their LED television sets. So consumers may tend to purchase a regular LED TV from another renowned brand like Samsung, instead of the smart TV sets of Walton at a cheaper price. Chinese smartphone maker Huawei has started to supply their windows powered handsets in collaboration with Rangs in Bangladesh. They could eventually capture a significant market share in Bangladesh before Walton. So Huawei is a threat to Walton.

From the SWOT analysis that has been carried out, it is evident that achieving the objectives of the company is not so simple as it seems. While
Walton has already created a brand value among its customers, they still have a long way to go. If they can enter the E.U and U.S market, the company will have a great chance to solidify their brand image and strengthen the company name. As mentioned earlier, Walton has a product based organizational structure. Now in this type of structure, the vice presidents all report to the CEO.

And since the vice presidents co-ordinate the operation of the departments such as accounts, finance, HR, and so on, these departments work smoothly, as there is no delay in decision making. The burden of decision making to the CEO is thus lessened. The Product based structure is all about the products of the company. so therefore the performance of the product in the market is quite important. The structure will force the company to undergo research and development into the latest products, so that the company can increase their profits. In terms of expansion into other potential markets of the company, the product structure keeps the company performing at their level best to improve upon the current line of products, and come up with new products.

The threats, and weaknesses of the company may play a part in creating a barrier to achieving some of the objectives of the company. For example, if Walton wants to expand into the E.U and U.S market, they have to export their smartphones. In this case, one question that would come into play is, how saturated is the E.U and U.S markets with chinese handset manufacturers? This question will help the company take into account the competition it will be facing and market the product accordingly so it has an edge over the competition. So the threats and weaknesses create a barrier, but the structure helps to formulate the strategies in such a way that the barriers can be overcome.

1.5 Recommendation:

The organization structure of Walton helps to bring out new products through research, and helps to formulate strategies to achieve goals and objectives. One of the objectives of the company states that by 2015 it will expand into the U.S and E.U markets. After expanding into those markets, the product based organization structure may hold the company back. So then there may be a need for a change in organization structure of Walton as, the company will have to ship products to different geographic regions. So a geographical/regional organization structure might be more suitable for Walton at that point. A geographical organization structure means that the regional department/headquarters is situated in each region. So all the operations can be carried out locally in that region.

1.6 Conclusion:

Walton’s organization structure fuels its need for better research into products. Walton has a bright future ahead, with the visions planned. The company has plans to expand into other markets such as the computer market. Not only that, Walton also envisions supplying the local market with their own motorcycles, and therefore attempt to curb the imports of motorcycles to Bangladesh. The company is doing its best to make sure its future plans are successful and indeed come out as one one of the top electronics company among the world in the year 2015.