Organization of the Future: Sundance
IST 301
Dr. Petrick
Team 2: Marilynn Zayan, Mats Gausdal, Christa Hampshire, Jacob Eastman
November 21, 2014
Table of Contents
I.
Introduction
II. Background
A. Trends
B. Customer Experience
C. Employee Experience
D. Enhanced Communication
III. Organizational Structure
A. Department Interactions
B. Global Interactions
IV. Control Systems
A. Design Team Control System
B. Supply Chain Control System
C. Team Control Systems
D. System Interactions
E. Consequences
V. Culture
A. Recruiting
B. Values
C. Ethical Rules
VI. Conclusion
2
I.
Introduction
Sundance is a very successful company that utilizes technology in order to obtain strategic fit.
Sundance focuses on the interaction between information, technology and people in order to make it the
successful company that it is today. By having a structure that correlates to the implemented control
systems as well as the culture of the company, Sundance is able to adjust to the constantly changing
environment. The organization is backed by various fully functioning information systems. With the
correlation of the organization’s structure, Sundance is able to perform with efficiency and effectiveness.
Sundance sees itself as company that represents the true essence of how a digital business should operate.
Its ability to adapt to emerging technology is what makes the organization successful.
II.
Background
Sundance is an e-commerce company that offers a monthly updated fashionable clothing line to
young adult women. It is an international company that has various offices in North America, Europe, and
Asia. Sundance’s mission is to be the most customer-centric company, providing a fashionable clothing
line at the lowest possible prices. Sundance’s motto is “Keeping you up to date in the latest trends no
matter where the sun sets”. Similar to dancing, Sundance caters to various cultures and helps bring
cultures together in one location. Sundance bases their decisions off of customer satisfaction, and ensures
they present valuable customer service through tools such as the Customer Service Center. Always
keeping the customer’s best interest at mind, Sundance focuses on offering current clothing trends at a
reasonable price that are easily searchable for the customer’s convenience.
Innovation is essential to the growth of Sundance by conveniently providing customers with a
variety of clothing options at low prices. Sundance contains global teams at fulfillment centers and
customer service centers located throughout North America, Europe, and Asia, which provide fast,
reliable shipping directly from Sundance’s website. The customer service centers offer 24/7 support,
directly catering to the customer’s needs. With the use of multiple locations in various time zones,
Sundance can accommodate a customer at any time of the day. Sundance also utilizes technological
innovation to enhance the internal communication within the company, allowing the company to operate
effectively and efficiently.
A.
Trends
The trend of obtaining services and products online when you want it for the least amount of
money is a constant in the world of e-commerce. Sundance continues to innovate not only in the clothing
and accessories they provide but also in the services for their customers. The company also uses Business
Intelligence to help match the customer with items that may complete an outfit they have already
purchased or recommending an entirely different outfit in their style. With these types of services,
Sundance is able to stand out amongst other e-commerce clothing websites in giving the customer a
complete experience.
With the numerous data breaches and security issues with many businesses around the world, it is
important that Sundance stays ahead of security threats and privacy concerns. Consumers continue to
flock to companies that they feel safely guard their information and maintain their privacy. Companies
that are infiltrated and found to be unsafe lose a large amount of customers and find it difficult to win
them back. Sundance continues to create security measures and stays up to date with the latest technology
to ensure customers’ ease of mind when they purchase or do business with them.
B. Customer Experience
Since Sundance is a customer-centric company, they want their customers to repeatedly buy
products from them. For this reason, they offer a unique customer experience that sets their company
apart from the average e-commerce clothing company. Customers are able to shop a new, exclusive line
3
of clothing every month based on their geographic region with a particular design team highlighted each
month. Each region only has access to the designs from the sub design teams in that region. For example,
anyone in North America will only be able to view and buy designs from the five North American sub
design teams. Past lines are offered at a discount price. Sundance also wants to give their customers
incentives to rate their clothing purchases not only for feedback for the designs teams, but also to make
future purchases. After a twenty-dollar cart total, customers receive free shipping. After reviewing five
articles of clothing, a ten dollar website credit is given (a currency conversion is made as needed to cater
to each region). This allows design teams to receive feedback on their clothing and for the company to
gauge the interest of each customer. Sundance stores customer measurements to suggest what clothing
size will fit best for their personal body size and shape. The company wants the customer to enjoy a quick
and efficient shopping experience by having available employees 24/7 for customer service. Exemplary
service and care for all customers is always a core competency for Sundance.
C. Employee Experience
Peoples’ motivations and ambitions have always remained a constant in the working world.
Employees want to make money to support themselves and their families. They also want to find pride in
their work. Everyone needs money but they also want to feel satisfied in their job as well. Due to this,
Sundance incentivizes their workers not just with money but also with acknowledgment. When a design
team’s line does exceptionally well for the month, they are highlighted the next month with their current
designs and information about what they enjoy designing. They also receive a larger percentage of overall
sales. This promotes friendly competition because there isn’t a penalty for the sub design teams that do
not have the highest rank for that month, only incentives for the sub team that does have the highest rank
for the particular month. This will be explained in more detail in the Design Team Control System
section.
Since Sundance's main goal is to provide a customer-centric experience, their control systems
reflect that. Sundance wants to understand their employee’s motivations and behaviors, therefore control
systems are created that incentivize employees on a financial and personal pride basis. Thus, employees
are able to achieve the goal of a great customer experience while still working within the confines of a
control system.
D. Enhanced Communication
A major problem with working in a virtual space is lack of personable interaction. When two
people are communicating over the phone, neither one of them is able to see each other’s body language.
It is hard to pick up on the other person’s attitude towards a decision based solely on tone of voice.
Sundance utilizes holographic technology that solves this problem. With the implementation of
holograms in a meeting setting, the issue of employee’s inability to see each other’s body language no
longer exists. Everyone in the meeting is able to see one another, as if they were in the same room. In
order to use this technology, an employee puts on a piece of headgear and an image appears inside the
head gear of everyone else on the team, located in a virtual meeting room. This eliminates the lack of
personal atmosphere in meetings not located in a physical space.
This new technology is a direct benefit of Sundance’s matrix structure (the structure will be
talked about in more detail in the following section). In the matrix structure, employees report to multiple
people, enlarging the size of meetings. These employees are both in the physical workplace and overseas.
In a combined physical and virtual work environment, a lack of communication between workers can
exist. This could have an impact on the effectiveness of the work that is being performed. Many times in
meetings that have multiple employees in the physical room as well as employees over video chat or
telephone, the people not in the physical room with everyone else feel possibly disconnected. There could
be side conversations in the physical room happening that the employees over the virtual network are not
hearing. There also is an easier chance for an employee’s voice over the phone to be drowned out if there
4
are a large number of employees in the physical room talking over one another. By bringing the entire
company to a virtual space, this creates equal input and connections throughout the employees in the
meeting, creating a more effective environment.
Not only are holding meetings in a combined physical and virtual place an issue, a physical
working environment has the advantage of “water cooler” conversations among employees. People who
work in a physical space with their colleagues still have casual conversations about a project when they
are getting coffee, passing by each others desk, and at lunch. This is very hard to avoid unless all
employees work from home, or are kept isolated from other employees. Although working from home is
beneficial for some people, a lack of focus can arise. In a working setting, employees are able to put their
home life aside and zero in on their work. If they bring their work home, this will combine their work life
and their home life. A lack of effort is a possible issue that could arise from this.
For the knowledge worker, work has transitioned to a more virtual setting. The organizational
structure responds to this transition by emphasizing its structure to benefit this virtual development.
Workers are required to report to different departments and they have to share their resources, which can
cause less efficiency, and delays on product releases as employees have responsibility over a range of
products. From the worker’s point of view, they typically prefer to meet physically. More effective
meetings can exist when an employee is in the same room as another colleague. With the holographic
technology implemented, workers are more satisfied with meeting in a virtual space. Today, “virtual
space” is now the new “physical space” in the work setting within Sundance.
III.
Organizational Structure
Sundance’s organizational structure has adapted to enhancements in the ease and speed of
communication across large distances and facilitates the creation of a highly varied product line in a
global market. Sundance has no brick and mortar locations. For this to be possible there are separate
departments, which serve specific geographic locations; however, these departments are intertwined in
order to manage a global supply chain and keep the company focused on a common goal.
Sundance’s structure resembles a matrix, but the specific departments are devised based on
location. There are three regional teams, North America, Europe, and Asia. Each of these regional teams
has common functional groups within them. A global team heads each function on a company-wide basis.
Each global team is led by a Chief Officer, who reports to the Chief Executive Officer (Refer to Figure 1).
A.
Department Interactions
HR and Legal have specific departments for each region to adhere to different laws in each
location. This team works with other departments to avoid breaking any laws in regards to hiring,
production, shipping, finance, marketing, and IT. All other functional groups within the division check
any plans with the legal department. Each regional department’s HR/Legal Head reports to a Global
HR/Legal head who has to coordinate activities on an international basis.
Finance makes sure each department has a properly allocated budget. Each division has a separate
finance function headed by a regional leader because of differences in each region’s economies. The
regional leaders report to the global Chief Financial Officer who manages finance for the entire company.
Marketing works closely with the design department to effectively target customers with the
types of clothing designs they desire. Marketing has multiple employees who essentially act as a member
of each design team, but they report directly to the regional marketing director. The regional marketing
head reports directly to the global marketing head.
5
IT and Info works all across the company to bring a streamlined IT solution to the company. As a
highly integrated company IT and Info works with every functional group. The Information Systems,
Business Intelligence Systems, and Analytics Systems are integrated and uniform across the company
making communication across divisions important. Each division has a regional IT leader who manages
his or her region’s IT while the Chief Info Officer makes sure the systems run properly across divisions.
Supply Chain is integrated across divisions because people may be ordering clothes from
different geographic regions. All of these subdivisions report to the global supply chain leader. The head
of each divisional supply chain also works with other department heads in its division to manage regional
operations.
B. Global Interactions
It is important for the global departments to communicate and work together as there are many
parts of the business, which rely on each other. Clothing can differ greatly from one culture to another,
but there are still many opportunities to bring a certain style popular in one part of the world to another
area, making it necessary for geographically separated Supply Chain departments to seamlessly work
uniformly. If one day this particular style of clothing becomes popular in Asia, which had been popular in
North America, it is beneficial to have an efficient supply chain that effectively and efficiently brings this
clothing style to Asia from North America.
This same example holds true for other functional areas of Sundance. It is important for Sundance
to share design ideas and marketing could collaborate on popular styles in their specific markets. Sharing
design ideas has become even simpler as 3-D printing for clothing accessories and the ability to
simultaneously edit and discuss design ideas while in different parts of the world has become easier. With
an efficient and highly collaborative supply chain, highly varied designs from all over the world, and the
ability to create a unique piece of clothing at any time, Sundance not only appeals to major markets, but
the long tail as well. Sundance’s success going forward will be predicated on its ability to effectively
function and communicate in a highly volatile global market.
IV.
Control Systems
Sundance has three control systems implemented throughout the company. The design team and
the supply chain team both have a control system that caters to that department’s needs and goals. In
addition, the regional teams also have a control system established in order to enhance communication
between the three regions. These control systems cater to the organizational structure of Sundance
through various aspects.
A.
Design Team Control System
Sundance’s customers are presented with the top fashion trends monthly in the relevant
geographic areas. The success of Sundance relies heavily on the types of products issued to their
customers. For this reason, a control system is implemented within each regional design team to ensure
the success of the clothing line. This control system allows the clothing line to be constantly updated each
month to the newest fashion trends by promoting a competitive work style across the regional teams.
The design team in each geographic region has a narrow span of control, allowing for a more
effective behavior control. Each geographic Design Team has five sub design teams that the control
system applies to. Each sub design team consists of five people including a team leader, overseen by the
Design Head of that region (Refer to Figure 2). Each person in the sub team collaborates together to
produce a final design line to be put into production each month. Having a small span of control allows
the Design Head in each region to keep everyone on task. In addition, it allows for more communication
within the sub design teams to promote ideas.
6
To counter the high cost of a narrow span of control, each sub design team in each geographic
region has less standards, decreasing the system cost as well as conflicts and behavior problems. One
standard that this control system implements is submitting a new design line each month to the Design
Head. The other standard is each of the 5 sub design teams in each region has a meeting halfway through
the month with the Design Head in that sub team’s particular region to talk about the sub team’s design
progress for that month. The sub team comes to the meeting ready with a report and a portfolio of
preliminary designs that they go over with the Design Head. This allows the Design Head to see each sub
design team’s progress in the middle of the month as well as provide feedback. Each sub team also has a
meeting with the Design Head at the end of the month to review the outcome of the sub team’s rank. The
system monitors the sales of each sub design and the employees are able to see the progress of their sales
as well as their current ranking in order to know their standing at any point of the month.
The Design division uses an analytical control system based on ranking. Each of the five sub
design teams in a particular region is given a rank determined by the number of designs that sell during
that particular month, as well as customer feedback on articles of clothing. The ranking of each sub
design team is only compared to the sub teams in that region. The system takes into account the quality
and price of the clothing as well as the level of advertisement given to that piece of clothing. The highestranking sub design team in each region is given a bonus along with the front-page advertisement spot of a
design of the team’s choice for the duration of the upcoming month.
Understanding how employees want to work and what they need to be successful and feel
motivated is extremely important. Output versus behavior is a concern within this control system, as you
want to automatically measure the output of the teams. Creating small sub design teams allows a
significant amount of creativity and allows individuals to motivate themselves to do well. Having a
balance of monitoring employees is also a current concern. Allowing employees to not feel overburdened
by management but making sure they are still in control within the company is a priority.
This control system focuses on output controls. The result of the success of each sub design
team’s designs is what determines the ranking in the system. The goal of this system is to figure out
which sub design teams are more effective and crowd appealing each month. The ranking system resets
each month in order to give each sub design team a chance to become the highest ranked sub design team
in their region. This control system brings about a friendly competitive work-style, benefiting the quality
of the output of the new design lines each month. It directly correlates to the culture within the design
team (the culture is explained further in the next section) as well as the overall organizational structure in
Sundance (Refer to Figure 3).
B. Supply Chain Control System
Being a global company, Sundance ships its products to customers all over the world. Sundance’s
effective supply chain creates a competitive advantage as an online clothing retailer. Enforcing an
effective logistic operation saves money for the company, which translates to lower prices for customers.
Sundance has fulfillment centers in each of their geographic departments (North America,
Europe, and Asia). These locations are based upon where customer orders are the highest and where the
centers are the most effective. To bring customers the best experience possible, it is necessary to bring
them their product as quickly as possible and at the lowest possible prices. Sundance uses analytics and
data pertaining to customer buying patterns over time for this system. Sundance brings certain styles and
brands to specific areas in anticipation of orders based on customer patterns.
Sundance’s supply chain is highly integrated across departments. Most of the time, it is
unnecessary and ineffective to ship products across continents because clothing styles differ by
7
geographic region. Using analytics, Sundance is able to keep minimum inventory to meet customer
demand and move products from one region to another depending on the regional demand.
Sundance’s fulfillment centers are largely automated. The high level of automation allows for
wide spans of control, more standards, and many eliminated behavior standards. The Supply Chain
operates in a very similar way for the North American, European, and Asian groups. A logistics
information and warehouse management system is advanced enough where machines and forklifts are
able to receive, pick, pack, and load any order. Human error and motivation are nearly eliminated as they
only need to step foot in the physical warehouses for maintenance and supervision.
An automated warehouse changes control systems in the supply chain. Larger spans of control
eliminate costs. Output standards are monitored in real time and every machine performs with no worry
of policies or procedures. Management of the supply chain is about scientific management and industrial
efficiency. Many of the control systems within Supply Chain are eliminated or scaled down. The supply
chain needs to effectively use business intelligence systems and analytics across geographically dispersed
locations in order to be successful. To be efficient as possible, the Supply Chain gathers information from
all departments, which fits well with the organization’s matrix structure (Refer to Figure 4).
C. Regional Team Control System
Due to the fact that Sundance has a geographic matrix structure, it is important to implement
control systems across the various geographic teams. These policies promote communication between the
geographic teams in order to ensure everyone has the same scope in mind at all times.
Sundance has a standard control system implemented across each geographic team facilitating
meeting times. This control system establishes a rotating meeting schedule with each geographic team
based off of time zones. For example, if a meeting time is inconvenient for the North American team but
not the Asian or European team, the meeting time will rotate to accommodate each team’s time zone.
There are two meetings each week between the teams, one over the phone and the other utilizing the
holographic technology. Therefore, one meeting will require the employees to be in the office to have
access to the holographic technology, whereas the other meeting will allow the employees to have a more
flexible arrangement.
With the incorporation of cross-functional teams, work speed and communication between
departments are enhanced. The use of cross-functional teams also helps each division keep the same end
goal in mind (better the customer experience). For example, the marketing department is able to
communicate with the design department by sharing information on what appeals to the customers in each
region. In addition, the supply chain and design team are able to communicate to marketing and inform
them of when a new shipment approaches or designs that they can relay to the customers. With the use of
these control systems in place across the North American, European and Asian team, communication is
greatly enhanced.
D. System Interactions
Each function is interdependent on each other in some way so it is important for them to work
together. For example, marketing needs to work with each design team to effectively target customers.
Production needs to communicate with marketing and design to make sure they can realistically produce a
certain product. IT needs to work with every group because all items are sold online and all parts of the
business incorporate a technology component. This creates a clan control system within the divisions.
North America works as a team with a common goal. Marketing pulls together designs from all design
teams in its group in order to eliminate competition between marketers who may have different goals.
Success of the entire company is measured as a single unit.
8
Sundance’s sub-design teams function in an internal market. Five design teams act as specific
units within each regional department. Each of these design teams has their outputs measured allowing
their exact contributions to be measured and compared. Higher performing teams are rewarded through
bonuses, larger budgets, and possible promotions.
In addition, there is a vertical control system, which also has an internal market structure.
Demands for products are different for each region Sundance operates in. Each department’s output can
be measured which means budgets and resources are distributed accordingly. The VP of each functional
group reports to their respective president. Sundance’s control systems throughout the company interact
in a smooth and effective manner.
E. Consequences
As Sundance progresses in the future, newer technological features are implemented to keep the
organization competitive. The implementation process has the possibility of causing unexpected obstacles
for the employees and partners. The organization aims to prevent a spread of possible displease to their
customers. Therefore, as newer technological practices are implemented the operation and utilization puts
the customer experience first in mind. Sundance’s mission emphasizes on delivering low-cost fashion
accompanied with excellent customer service. It is their main way in gaining customer growth, today, and
from here on out.
As Sundance is an online only company, they cannot afford to have their website down. For this
reason, an internal challenge that can occur is a system glitch. If the website goes down, then a large
amount of business is lost. IT is responsible for maintaining the upkeep of the website and accounting for
system failures. In addition, it is essential to ensure IT can handle any problems the customers have in
regards to the website and purchasing products. Accounting for these possible problems betters the
customer experience if an issue occurs.
V. Culture
The overall culture at Sundance is professional and formal with a business casual dress code. Due
to the fact that this is a large geographic company with a matrix structure, it is essential to have a formal
culture established throughout the organization since there are various departments and regional teams.
The overarching tenets at Sundance are friendly competition, innovation, open communication, and a
professional atmosphere. However, the culture changes across the departments within Sundance based on
the role of each department. For example the Finance Team has a formalized culture because they have a
large responsibility of dealing with the customer’s transactions. There needs to be set rules and
regulations within this department in order to prevent mistakes or misunderstandings when dealing with
the customer’s money. On the other end of the spectrum, the Design Team has an informal culture in
order to promote creative minds. Their role, which is to create designs for the customers each month, is
not as stressful as the Finance Team. Creating a bad design will only decrease sales for that month;
mistakes can be accounted and fixed for without major company meltdowns occurring.
Friendly competition between employees is promoted in the company in order to add excitement
into the workplace. For example, by the control system within the Design Team offering an incentive to
the highest-ranking sub design team in each region, it allows friendly competition to exist within the team
as well as increases the team’s motivation to do well. Sundance encourages competition between
employees throughout the company but ensures that it does not cause stress or discouragement. Sundance
rewards employees that exceed but does not penalize employees that do not rise above in a competition.
Sundance is an organic company, adapting to the changes in the environment based on what
customers desire and what the current trend is. The Design Team needs to constantly evaluate the
environment to see what the customers in each region desire and what the top fashion statements are.
9
Fashion changes constantly and it is important for the Design Team to focus on the change in each
geographic region.
A.
Recruiting
Sundance’s hiring process is not based on formal education. Since Sundance’s mission is focused
on customers, recruiters look for personable people who can communicate, keep the customer’s best
interest in mind, and bring innovation and ideas into the company. Having a certain degree from a certain
university is not one of the values Sundance looks for within their employees. Communication is key
within Sundance, both internally (within the company) and externally (speaking to the customers).
Employees need to be able to speak to customers on the help line, think about certain aspects from a
customer viewpoint, and think outside of the box to bring about ideas that will separate Sundance from
the average e-commerce company.
The recruiters at Sundance are very proactive in finding potential employees with creative ideas
and designs. They assess an employee’s profile on various websites and social media and contact the
candidates that they feel would best fit in the company. The interview process is composed of several
parts. The first part involves a one-on-one interview with a manger of a department that the candidate is
interested in. The second part involves giving the candidate a task in a group environment, monitored via
video for the interviewers to analyze. This allows the interviewers to see how the candidates interact with
each other and if they would fit in with the culture of Sundance.
B. Values
In order to reach a terminal value of being customer-centric, Sundance’s instrumental values
include being creative, flexible with customers, and hard working. It is important for the Design Team to
be creative in their designs and offer new designs to the customers each month. The customer service
representatives need to cater to the customers and be flexible with each question in order to accommodate
the customer and give them the best customer experience possible. Throughout the departments, it is
important for everyone to be hard working and stay on top of everything in order to remain at the high
standard Sundance sets themselves too. Retail is a very competitive sector and it is important that each
department puts all their effort into their work. By fulfilling these three things, Sundance is successfully
able to be the customer-centric company that their mission states.
C. Ethical Rules
As technology is developing, Sundance, like other organizations, have to deal with a changing
culture. Organizations are held to a standard of ethics. The organization has a responsibility to sustain
itself with the environmental changes including keeping up with new unethical behaviors that come
about. The organization is under the influence from a wide group of people. Since Sundance is a global
organization, based in three continents serving several different cultures, they have a focus on both the
Big C vs. little c culture. Sundance not only prioritizes on the interaction between the departments over
the large geographic regions, but also between the members of their respective departments.
The ethical standards are under constant influence from society. Sundance sees it of uttermost
importance that the ethical changes will have no effect on equality for their employees, partners or
customers. Race, color, sexual orientation, age, national origin, or disabilities are not discriminated
against. However, we believe that the ethical rules that exist today will remain as the years go on. There is
a possibility that more creativity in unethical behaviors will come about, and Sundance needs to account
for these as they come along. Some unethical behaviors that Sundance looks out for now that are
particular to the Design Team are stealing design ideas internally and externally, as well as a designer
buying a large amount of their own designs in order to influence their sales of that design. It is therefore
important that the culture and the control system can work together to minimize these risks.
10
VI.
Conclusion
Sundance is able to maintain a competitive edge over other e-commerce clothing companies. The
reason for this is strategic fit. Sundance is balanced with its organizational structure, control systems, and
culture, which allow it to provide a customer-centric experience with its products and services. The
organizational structure gives employees formality in the virtual workspace but also allows flowing
creativity and communication between and within departments. For the departments, a solid control
system allows employees to know what their job tasks are, who they work with, who they answer to, and
gives them an incentive to do their job and do it well. The culture within Sundance promotes innovation
through friendly competition and customer-centric values that are encouraged from the beginning of the
employee’s career. With structure, control systems, and culture in mind, Sundance is able to have a
competitive advantage over other companies in its market.
11
Figure 1 - Organizational Structure
Figure 2 - Organizational Structure within the Design Team
12
Figure 3 - Strategic Fit in the Design Team
13
Figure 4 - Strategic Fit in the Supply Chain Team
14