Dunkin Donuts Organizational Structure

To create an effective organizational structure and behavior for Dunkin’ Brands, the company’s structure has to reflect the brand recognition and value locally and internationally. The structure and behavior of an organization can change and evolve, as functions and roles change and evolve (Sandhu & Kulik, 2019). Dunkin’ Brands has to analyze its current organizational structure, its current organizational controls, and its current organizational behavior and human resources and create an implementation plan if operations are to be optimized.

Current Organizational Structure

An organization’s structure is composed of the qualities that the organization has in how it structures its relationships and the division of control, decision making, and responsibilities (Marasi, Bennett, & Budden, 2018). Two main elements in the organizational structure are centralization, which is how much input employees have when decisions are being made, and the level of formalization which is how rules and communication within the company are carried out (Marasi et al., 2018). Dunkin’ Brands organizational structure should reflect its strategy which will let managers know what needs to be done to have the freedom to make the decisions and create the necessary relationships needed (Marasi et al., 2018). As an organization with franchisees, the goals of Dunkin’ Brands and the goals of the franchise owners should align (Berkowitz & Wren, 2013). International management consultants can meet with franchise owners to provide guidance and information so that the owners can agree and commit to corporate strategies (Berkowitz & Wren, 2013).

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Dunkin’ Brands is led by a Chairman and CEO, who has executive officers and senior management teams responsible for operations in different national and international regions reporting to him (Dunkin’ Brands, 2019). This type of organizational structure that Dunkin’ Brands has is divisional. The divisional structure of Dunkin’ Brands allows each unit to function independently within the guidelines of the company’s strategic and financial goals (Li, Holsapple, & Goldsby, 2019). Having a divisional organizational structure allows Dunkin’ Brands to have flexibility within supply chains which creates a greater competitive and financial advantage (Li et al., 2019).

Current Organizational Controls

Organizations have to control, restrict, and direct the behaviors and actions within the organizational structure to achieve its strategic goal (Janićijević, 2017). Organizations have five methods of control that they can use. These are work process standardization, knowledge and skills standardization, managerial supervision, direct interpersonal communication, and output standardization (Janićijević, 2017). These mechanisms of organization control can differ in restrictions, personalization, autonomy, and formality (Janićijević, 2017). Dunkin’ Brands has a divisional organization structure in which the most effective method of control is work process standardization, where the chairman specifies the level of performance for each division, leaving it up to the divisions to use their methods to achieve it (Janićijević, 2017).

Management consultants work closely with each Dunkin’ Brands franchisees ensuring that the brand name is protected and that the performance objectives are lined up to the specifications of the chairman (Karmeni, de la Villarmois, & Beldi, 2018). To have a successful relationship between a management consultant and a franchise owner, there should be a balance between autonomy, control, and innovation, which Dunkin’ Brands provide (Karmeni et al., 2018). Dunkin’ Brands franchisees are independently owned and operated, and the owners are responsible for the business decisions and supply chains related to their franchisees (Dunkin’ Brands, 2016). Dunkin’ Brands do not control the labor and employment issues of franchise employees, the recycling and waste management contracts even though franchisees are advised to obey local regulations, and the amount of energy or water each franchise uses even though franchisees are given equipment specifications (Dunkin’ Brands, 2016).

Current Organizational Behavior and Human Resource Practices

The organizational behavior, human resources, and culture of an organization is a mixture of assumptions, values, norms, and attitudes that have helped in creating the success of the organization (Janićijević, 2017). Human resource practices are primarily motivated to create competitive advantages for organizations (Jehn & Bezrukova, 2004). Some of these practices are training, promoting diversity, having a broader vision, welcoming new ideas, and encouraging employee involvement and commitment (Jehn & Bezrukova, 2004). Dunkin’ Brands developed new and more relevant training and communications with the franchisees (Dunkin’ Brands, 2018). Through Facebook Workplace Dunkin’ Brands and its employees can have increased communication and engagement (Dunkin’ Brands, 2018).

Dunkin’ Brands promote having a diverse workforce, franchisee, and supplier base (Dunkin’ Brands, 2018). Dunkin’ Brands encourages open discourse for employees of all levels that generates and promotes learning, new ideas, innovation, and healthy relationships (Christensen, 2019). Dunkin’ Brands consists of employees of different ages, genders, cultures, races, and religions, and franchisees in different countries with different cultures, and focuses on an inclusive workplace, using inclusion to diversify the workforce, and having culturally relevant marketing programs that will strengthen Dunkin’ Brands position in the market (Dunkin’ Brands, 2016).

Analysis of Significant Behavior Issues

In a changing global economy, a challenge that organizations face is creating and maintaining successful collaborations (Odrakiewicz & Zator-Peljan, 2012). Dunkin’ Brands and its franchisees may face several financial issues, such as the availability of financing, competition for franchise sites, negotiating lease and financial terms, and the cost and availability of labor (Dunkin’ Brands, 2019). There may be conflicts with countries and franchisees may find problems securing the necessary permits that the domestic or foreign governments require, customers in foreign countries may not like the taste of the products or may not be accepting of the company (Dunkin’ Brands, 2019). Other issues may occur if a proper location for a franchise cannot be found, there is a small pool from which to choose and train qualified employees, and the weather conditions or other natural disasters (Dunkin’ Brands, 2019). Dunkin’ Brands needs to understand all aspects of the issues the organization and franchisees may face and gain the necessary knowledge needed to be successful when facing challenges in different countries and cultures (Odrakiewicz & Zator-Peljan, 2012).

Development of a Proposed Implementation Plan

To support operational optimization Dunkin’ Brands has to have its current organizational structure reflect its strategic plan. The objectives of the management consultant are to make sure that the goals of franchise owners align with that of the organization, that the brand value and name are protected. There has to be a balance between the rules of Dunkin’ Brands and the actions of the franchise owners, open discourse, and a diverse workforce for the organization. When there are financial issues or conflicts due to international or cultural differences, the organization should take steps so these issues are addressed as soon as possible.

Dunkin’ Brands can take preventative measures by having human resource plans that adhere to the ethical and business standards of the countries and cultures that business is done in (Jang, Kim & Yoo, 2017). Dunkin’ Brands should have strategies and action plans in place that supports and sustains strategic behaviors and decisions, starting from the recruiting decisions, to training and development classes, and having proper policies in place, so employees know where to go if any situation arises. There should be training provided for franchisees and employees as having sustainable human resources achieves a competitive advantage against the competition (Jang et al., 2017). The organization needs to include diversity management as part of maintaining a positive work environment, where everyone and every contribution is valued (Shaban, 2016).

Dunkin’ Brands is a global organization that is affected by changes in the financial, economic, and technological environment (Janićijević, 2017). To achieve its goals, Dunkin’ Brands must adapt its structure and function to the environment from which it operates (Janićijević, 2017). If Dunkin’ Brands achieves a balance between external factors and internal factors, its performance will increase and its goals will be met (Janićijević, 2017).

Conclusion

Currently, Dunkin’ Brands has an organizational structure and behavior that works. To achieve a structure that not just works, but is effective, Dunkin’ Brands has to understand and accept that change and evolution inside and outside the company are inevitable (Sandhu & Kulik, 2019). Analyzing its current organizational structure, controls, behavior and human resources, and creating an implementation plan for an optimal solution is a step in the right direction to create a leadership operational plan.

References

1. Berkowitz, D., & Wren, B. M. (2013). Creating strategic commitment in franchise systems: establishing the link between leadership, organizational structure, and performance. Journal of Small Business & Entrepreneurship, 26(5), 481–492. https://doi.org/10.1080/08276331.2013.876763
2. Christensen, K. (2019). Q&A: The former CEO of Dunkin’ Brands explains the importance of creating a “challenge culture” in every organization. Rotman Management, 88–91. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&AuthType=shib&db=bth&AN=135905688&site=eds-live&scope=site
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9. Karmeni, K., de la Villarmois, O., & Beldi, A. (2018). Impact of control on innovation: the case of franchising. Management Decision, 56(7), 1485–1505. https://doi.org/10.1108/MD-09-2015-0428
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