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Logic Of Electronic Markets Case Study Analysis

Background and Facts

Logic Of Electronic Markets a workplace materials merchant for little and also medium sized organisations has actually just recently been associated with planning for a merger with its competitor Residence Deport, which has actually influenced performance levels in departmentswith the senior manager involved in lawful complications put forth by the federal Trade Compensation. With the Marketing Head putting forward the news of his separation from the firm in one year, Jeannie Lewis, the existing head of operations has actually been asked to take the duty in the near future. With difficulties in the type of a prospective cultural change and low staff member spirits, the organization is in need of a complete reengineering effort at the advertising department.

Issue Statement
Porter's 5 Forces Analysis
The prospective cultural adjustment at the marketing department of Logic Of Electronic Markets is boosting unpredictability in the working environment causing different challenges for the Jeannie Lewis that would certainly be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in affecting strategic choices since Stapes Inc. had to desert its strategies of combining with Workplace Deport after the Federal Trade Payment's intervention at the same time. Offered the fact that the shop has a global presence with branches in UK, UNITED STATES, Canada and also Germany, political consider each of these countries might be able to impact efficiency or tactical goals. Federal Trade Commission's antitrust match against the merging took up important time of the company's elderly management suggesting that 'political' factors can have severe implications for a worldwide service.

Economic Factors: Economic factors such as the emergence of small businesses in the global circumstance suggest that Logic Of Electronic Markets is prospering in an atmosphere where there is potential growth of services. Reality that store consumers are mainly looking for office materials for house workplaces recommends that the market has a climbing fad of business owners as well as home based services.

Social factors: Social patterns in the economic situation show that clients are searching for benefit as well as appealing costs. Marketing research shows how the consumer for Logic Of Electronic Markets does not have awareness about discovering options which can use a combination of convenience and affordable.

Technical factors: Technology plays an essential duty in Logic Of Electronic Markets's organisation strategy particularly as the company is piloting Modern technology facilities which would supply technology sales and also assistance in the kind of memory upgrades, peripheral installments. (Recap of INSECT in appendix 2).

OB Issues as well as Manifestations.

A number of underlying Business Actions concerns can be seen in Logic Of Electronic Markets's case as highlighted in this section.

Worries concerning cultural change: There is worry concerning a social change that would take place as soon as Todd Krasnow leaves from his setting as the Executive Vice President of Marketing with most of the personnel currently revealing discontent over this possible move. This predicted modification has created anxiety in the work environment which has actually been combined with the past tension of preparing the firm for a prospective merging with Residence Deport.
Pest Analysis
Stressful Job Atmosphere for Newcomers: There is scarcity of employees that can match the stressful setting of a busy company. Not only does this bring about trouble in finding the appropriate individuals, it places stress and anxiety on new hires as can not stand up to the rate and stress that the company anticipates them to birth.

Dual Coverage Lines: Beginners discover this organizational society difficult as well as tough to cope with particularly as dotted line relationships are implied to be weaker as a whole and also unbiased setting as well as performance analysis is still done by the strong line manager. This indicates that novices can lose quality concerning their particular duties and also objectives particularly as dotted line reporting does not keep them in direct communication with the solid line supervisors.

Bitterness From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor instead of Bridget Coles although it had been guessed that the last would certainly take Krasnow's position came as a blow to her spirits. Lewis may have been capable as well as ideal for the job yet the truth that Kransnow's separation would make Coles a straight record to Lewis might have been the factor for Coles' resignation from solutions.

Concern & Job Instability: Concern as well as insecurity can be recognized as 2 major worries that Lewis would certainly be taking care of specifically as the merging has now be terminated as well as two senior execs of the marketing department would be leaving. The entire responsibility of the department would certainly be dropping on Lewis's shoulders that would not just be in charge of brining regarding a social modification yet would additionally have to prove herself in her brand-new role.

Inappropriate Administration Design of Leader: Lewis's administration design and its incompatibility with the advertising department's duty can likewise be seen as an OB difficulty especially as she has been made use of to taking care of concerns in the operations division where personnel are shown to concentrate on processes and also get them. The advertising department on the other hand can be viewed as a group of individuals who are used to being nurtured by Krasnow who focused more on outcome than procedures.

Interdepartmental Disagreements: Interdepartmental differences between 3 departments, marketing, merchandizing and procedures specifically over the appropriation of the advertising and marketing mix can be identified as one more OB worry. The advertising and marketing department does not share the very same vision as the various other two divisions concerning the aloocation of the advertising mix twoards promos and advertsing, the merchandizing and operations departments do not concur over the advertising and marketing mix appropriation amongst one another either.

Fragmentation in Advertising Department: Fragmentation between the advertising and marketing divisions can be determined as an additional OB problem which can require further focus. The reality that the advertising and marketing areas in the advertising and marketing division are detached is avoiding both divisions from acquiring from each various other's experience and knowledge. Combination of marketing with retailing as well as procedures would certainly become more difficult if the marketing department itself is broken down which can be another potential OB problem.

Logic Of Electronic Markets Analysis

Various concepts have actually been utilized to explain the scenarios to get further quality about the circumstance handy.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Concept X, most managers believe that juniors are easy and lazy, have little passion and also stand up to change. The circumstance at Logic Of Electronic Markets is not totally complying with Concept X, it can be seen that new hires are finding this setting instead stressful which might ultimately lead to a better inclination of the administration in the direction of Theory X. Also while evaluating Lewis's management style, theory X might have been ideal in the procedures division to some extent yet the Marketing division would certainly need dependence on Concept Y in order to get the creative thinking and originality from the groups.

Tuckman's Team effort Concept: As far as Lewis's worry concerning bringing consistency in between the advertising and marketing division is worried, this would at first cause clash as discussed by Bruce Tuckman in his 'Team effort Theory'. (Tuckman, 1965). As per Tuckman's theory shown in appendix 3, during the preliminary phase of group growth, individuals may not bond, as they are hectic locating their area in the team. By integrating the advertising and marketing department's work, there might be the same preliminary separate which might result in the 2nd phase of 'storming' where the teams test each other. Nevertheless, it is only during the 3rd phase or 'norming' when they would come together to share ideas before the group can cause harmony in the fourth stage 'performing'.

Bridges' Transition Version: Based On William Bridge's theory (appendix 4), individuals are quite uncomfortable with change, which is evident by the scenario at Logic Of Electronic Markets The situation can be viewed as a normal training course of life if is studied according to Bridge's concept where he describes that individuals experience three stages of transition when they experience adjustment. 'Ending, losing and Releasing', The Neutral Zone as well as 'The New Beginning' (Bridges, 2004). When individuals exist with change, they enter stage one and so there may be emotions like despair, uncertainty, frustration, rage, concern, rejection and also disorientation.The circumstance at the marketing department of Logic Of Electronic Markets is comparable so Lewis can get comfy with the suggestion that it is not amazing behavior. In the second stage, there may be a need to bridge the space in between the brand-new as well as old society so Lewis may have to encounter this experience as soon as Krasnow leaves. There might be low morale as well as reduced productivity at this phase which need to not be taken as a setback. It is throughout this stage that Lewis will certainly have to give guidance to the department so that they can discover an orientation. It can be seen how Krasnow has currently made this shift much easier by making Lewis obtain involved in the department a year prior to his real separation. As per Bridges' Model, phase three will cause openness to learning, High energy and also commitment as individuals will certainly accept the modification (Bridges, 2004).
Vrio Analysis
Maslow's Demand pecking order: The OB problem related to instability at the workplace has actually been triggered firstly by the adjustment in administration and secondly by the reality that the merging will no more be started. Abraham Maslow in his Concept of 'Demands Hierarchy' (appendix 5) has reviews the value of 'protection needs as being a lower degree demand of a human for causing motivation. As seen in the pyramid shared in appendix 3, we can see just how 'the demand to feel safe and secure as well as untouched' is at the second level of requirements. Before a worker can be made to develop mentally, he requires to have his 'Physiological 'and 'Safety and security' needs fulfilled. This indicates that unless the employees are made to feel safe and secure concerning their present employment condition in Logic Of Electronic Markets they may not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Logic Of Electronic Markets Case Study

Effects of Analysis.

The OB analysis has actually considered numerous concepts to recognize just how to handle the existing situation available. The complying with three choices have actually been recommended to help Lewis handle the organizational challenges in the marketing department. Each of these choices has actually been recommended for reducing the change needed to bring the advertising and marketing department according to the requirements of the marketplace and for making the cultural change that would certainly follow when the present leader leaves.

Integration of marketing and advertising functions. Separating Adverting as well as Production features. Combination of Advertising And Marketing with Operations.

Evaluation of Alternatives.

Judith Shapiro who has actually earlier been interviewed by Lewis during the earlier merger days has experience in business-to-business advertising along with agency and retail advertising and marketing experience. As soon as Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising to take care of both advertising and marketing and also advertising and marketing functions.

The advantage of this technique is that it will certainly integrate the two features while lowering the requirement for hiring an extra source for marketing. In addition to this, Lewis would be heading the advertising and marketing department and also in any case her substitute would be needed for the existing function that she is carrying out. The downside of this choice is that outside hiring might produce bitterness from inner personnel who may be looking at the setting of EVP after Lewis takes over Krasnow's setting.

Dividing Adverting and Production: Provided the competitive stress as well as high top quality work needed from the advertising company, it is suggested that Lewis should enable the production system to be a separate function from the advertising device. Given that many advertising and marketing agencies had these 2 functions as separate systems, it makes more feeling to adhere to the standard.

Combination of Advertising And Marketing with Operations: Given that Lewis is already dealing with the marketing as well as procedures divisions concurrently; it makes sense to incorporate both functions since she has been efficiently taking care of both ends. The truth that both departments already have significant distinctions over allotment of sources suggests that this integration might have the ability to produce consistency especially as Lewis would be heading both ends.However there are various disadvantages of this relocation specifically as it would place too much burden over Lewis's shoulders. The fact that Lewis needs to adapt her administration design for the advertising division recommends that these two divisions would certainly be culturally diverse. Along with this, Lewis might not be able to apply one type of leadership design to both departments which can cause ineffectiveness in either one of both features.


An analysis of the 3 alternatives suggests that combination of advertising and marketing and procedures would certainly not be a feasible step due to the substantial differences between the two departments despite the fact that presently Lewis is dealing with both. While splitting up of the manufacturing function might have been a favorable action for the marketing department, the truth that it would indicate positioning a 3rd feature under Lewis's wing implies this need to be stayed clear of too. The assimilation of the advertising and marketing division is the very best alternative in terms of getting the optimal arise from the division. An action plan for this choice is discussed below.

Action Strategy.
Lewis will take control of the function of EVP Advertising and marketing after Krasnow leaves.

Advertising and Marketing features would certainly be merged.

Judith Shapiro will certainly be employed to take Lewis's location as SVP of advertising and marketing.

Manufacturing function will certainly stay part of advertising under marketing function.

Lewis will separate herself from operations.

An autonomous leadership style with employee empowerment will certainly be used in advertising and marketing department.

Open door plan and focus on cross department communication will be targeted at eliminating discord.

Backup plan.

If the integration does not work out as planned, a contingency strategy would certainly adhere to which would certainly separate the manufacturing function from the advertising and marketing feature to lower the lots on the SVP of marketing and advertising. In case Judith Shapiro does not obtain hired, Lewis will be heading the advertising and marketing department without an SVP. Because case the production function will certainly be separated by putting it under an SVP production.