Logic Of Electronic Markets Case Study Solution


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Logic Of Electronic Markets Case Study Solution

Background and Facts

Logic Of Electronic Markets an office supplies store for tiny and moderate sized companies has lately been involved in planning for a merger with its rival Home Deport, which has influenced performance levels in departmentswith the elderly manager involved in lawful complications presented by the government Trade Compensation. With the Advertising and marketing Head putting forward the news of his separation from the company in one year, Jeannie Lewis, the existing head of operations has been asked to take the duty in the future. With difficulties in the type of a potential social adjustment and also reduced worker morale, the company is in need of a full reengineering initiative at the advertising division.

Issue Statement

The possible social change at the advertising and marketing division of Logic Of Electronic Markets is increasing unpredictability in the working environment leading to numerous challenges for the Jeannie Lewis who would be changing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in impacting calculated choices since Stapes Inc. had to abandon its strategies of combining with Workplace Deport after the Federal Profession Commission's intervention while doing so. Offered the reality that the shop has a global visibility with branches in UK, U.S.A., Canada as well as Germany, political factors in each of these countries might have the ability to impact performance or calculated objectives. Federal Trade Payment's antitrust fit against the merging used up valuable time of the company's senior monitoring suggesting that 'political' factors can have severe implications for a global service.

Economic Factors: Financial factors such as the introduction of small companies in the global circumstance recommend that Logic Of Electronic Markets is flourishing in an environment where there is potential growth of companies. Along with this, fact that shop clients are mostly searching for office supplies for home offices recommends that the market has a rising trend of business owners and home organisations.

Social factors: Social fads in the economy show that customers are seeking ease in addition to attractive rates. Marketing research demonstrates how the customer for Logic Of Electronic Markets does not have recognition concerning finding remedies which can use a mix of benefit and low costs.

Technological factors: Technology plays an important function in Logic Of Electronic Markets's company strategy specifically as the company is piloting Modern technology centers which would supply modern technology sales and assistance in the kind of memory upgrades, outer setups. (Summary of PEST in appendix 2).

OB Issues and Symptoms.

Several underlying Organizational Behavior problems can be seen in Logic Of Electronic Markets's case as highlighted in this section.

Apprehensions regarding social change: There is apprehension regarding a cultural adjustment that would happen once Todd Krasnow leaves from his setting as the Executive Vice President of Marketing with the majority of the staff members already revealing discontent over this prospective move. This predicted adjustment has actually created anxiety in the workplace which has been combined with the previous stress of preparing the company for a prospective merger with Home Deport.

Demanding Job Atmosphere for Newcomers: There is lack of personnel that can match the difficult environment of a busy company. Not just does this lead to trouble in finding the ideal people, it puts tension on new hires as can not withstand the rate and also pressure that the company anticipates them to bear.

Dual Reporting Lines: Newbies find this organizational culture cumbersome as well as hard to handle especially as dotted line partnerships are meant to be weak in general and also objective setting and efficiency examination is still done by the solid line manager. This implies that newcomers can lose clearness concerning their corresponding roles and purposes specifically as populated line reporting does not keep them in direct interaction with the strong line managers.

Resentment From Cross Departmental Hiring: Krasnow's decision to make Lewis his follower as opposed to Bridget Coles even though it had been hypothesized that the last would certainly take Krasnow's placement came as a blow to her spirits. Lewis may have been qualified as well as appropriate for the task however the fact that Kransnow's separation would make Coles a direct report to Lewis may have been the reason for Coles' resignation from solutions.

Concern & Work Insecurity: Fear and also instability can be recognized as two significant issues that Lewis would be taking care of specifically as the merger has actually currently be cancelled and 2 elderly execs of the advertising and marketing division would be leaving. The entire responsibility of the department would certainly be dropping on Lewis's shoulders that would certainly not just supervise of brining regarding a social modification but would certainly likewise have to confirm herself in her new function.

Incompatible Administration Design of Leader: Lewis's monitoring design as well as its conflict with the marketing department's function can likewise be viewed as an OB obstacle particularly as she has been used to taking care of concerns in the procedures department where employees are instructed to focus on processes as well as get them right. The advertising and marketing division on the various other hand can be seen as a group of individuals that are made use of to being supported by Krasnow that focused much more on outcome than processes.

Interdepartmental Disagreements: Interdepartmental arguments in between three divisions, advertising and marketing, merchandizing as well as operations specifically over the allocation of the advertising mix can be identified as another OB concern. Although the advertising department does not share the very same vision as the other two departments concerning the aloocation of the advertising and marketing mix twoards promos and advertsing, the merchandizing and operations departments do not agree over the advertising mix allotment amongst each other either.

Disintegration in Marketing Department: Fragmentation between the advertising and marketing divisions can be determined as another OB concern which could require more interest. The fact that the advertising and marketing areas in the marketing department are separated is preventing both departments from getting from each various other's experience as well as proficiency. Integration of marketing with retailing and operations would certainly come to be harder if the advertising division itself is disintegrated which can be another possible OB issue.

Logic Of Electronic Markets Analysis

Different theories have been made use of to clarify the circumstances to get additional clarity concerning the situation handy.

McGregor's Concept X & Y: According to Douglas McGregor's Theory X, many supervisors believe that subordinates are easy as well as careless, have little aspiration as well as withstand change. The hard variation of this concept stressed threat, limited controls, risks and punishments. With time it produces reduced performance, subtle sabotage and rivalry (Deal, 2003). The scenario at Logic Of Electronic Markets is not completely complying with Concept X, it can be seen that new hires are finding this setting rather stressful which might at some point lead to a higher disposition of the administration in the direction of Theory X. According to McGregor's supported view, which he called Concept Y, the vital task of the monitoring is to set up business conditions so that individuals can achieve their own objectives best by guiding their initiatives in the direction of organizational incentives. If individuals locate no fulfillment in their job, the monitoring would certainly have little choice but to count on concept X and also external control (Offer, 2003). Even while analyzing Lewis's administration design, concept X might have appropriated in the procedures division to some extent but the Advertising department would require reliance on Concept Y in order to get the imagination and creativity from the teams.

Tuckman's Teamwork Theory: As far as Lewis's concern about bringing consistency in between the advertising and advertising department is worried, this would initially lead to conflict as talked about by Bruce Tuckman in his 'Teamwork Concept'. By combining the advertising and marketing as well as advertising department's work, there may be the same preliminary detach which might lead to the 2nd stage of 'storming' where the groups challenge one another.

When individuals are presented with modification, they enter phase one and also so there might be emotions like unhappiness, uncertainty, disappointment, rage, concern, denial as well as disorientation.The scenario at the advertising and marketing department of Logic Of Electronic Markets is similar so Lewis can obtain comfy with the concept that it is not phenomenal actions. It is during this phase that Lewis will certainly have to provide guidance to the department so that they can find a feeling of instructions. It can be seen how Krasnow has already made this transition much easier by making Lewis obtain involved in the department a year prior to his real departure.

Maslow's Need power structure: The OB problem pertaining to instability at the office has been triggered to start with by the adjustment in management and second of all by the truth that the merging will no more be launched. Abraham Maslow in his Concept of 'Needs Pecking order' (appendix 5) has goes over the significance of 'safety and security needs as being a reduced level need of a human for setting off inspiration. As seen in the pyramid cooperated appendix 3, we can see exactly how 'the need to feel safe and also untouched' goes to the 2nd level of needs. Before an employee can be made to develop emotionally, he needs to have his 'Physiological 'as well as 'Security' needs fulfilled. This indicates that unless the employees are made to really feel safe and secure about their present work condition in Logic Of Electronic Markets they might not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Logic Of Electronic Markets Case Study

Ramification of Analysis.

The OB analysis has checked out various theories to recognize just how to deal with the existing situation available. The adhering to three alternatives have been suggested to aid Lewis manage the business obstacles in the advertising department. Each of these choices has actually been recommended for alleviating the change needed to bring the advertising and marketing division in line with the needs of the marketplace as well as for making the social modification that would follow once the present leader leaves.

Assimilation of marketing and advertising features. Separating Adverting and also Manufacturing functions. Integration of Advertising And Marketing with Workflow.

Evaluation of Alternatives.

Judith Shapiro who has actually earlier been interviewed by Lewis throughout the earlier merging days has experience in business-to-business advertising and marketing along with company as well as retail advertising experience. When Krasnow leaves, Lewis can work with Shapiro as an EVP for advertising and marketing to deal with both marketing as well as marketing functions.

The advantage of this technique is that it will incorporate both functions while lowering the need for employing an added resource for advertising. Lewis would be heading the advertising and marketing department and also in any case her substitute would certainly be required for the existing function that she is doing. The negative aspect of this alternative is that outside hiring may bring about bitterness from inner workers that may be looking at the position of EVP after Lewis takes over Krasnow's placement.

Dividing Adverting and Manufacturing: Given the competitive pressures and top quality job needed from the ad agency, it is suggested that Lewis should permit the production unit to be a separate feature from the marketing device. Because most advertising agencies had these two features as separate units, it makes more feeling to adhere to the standard. Along with this, both functions might be able to concentrate on their core activates extra effectively. The drawback of this technique would be that extra prices would have to be borne for setting up separate production features. A production head might have to be employed which can raise overheads for the company.

Integration of Advertising And Marketing with Workflows: Since Lewis is already dealing with the advertising and also procedures divisions all at once; it makes sense to incorporate both features since she has been effectively looking after both ends. The reality that both departments currently have significant differences over appropriation of sources recommends that this assimilation might be able to produce consistency particularly as Lewis would certainly be heading both ends.However there are different downsides of this step especially as it would certainly put way too much worry over Lewis's shoulders. The fact that Lewis has to adapt her administration design for the advertising department recommends that these two departments would be culturally diverse. Lewis might not be able to use one type of management design to both divisions which can result in inefficiency in either one of the 2 features.


An evaluation of the 3 options shows that integration of marketing as well as procedures would certainly not be a possible step due to the large differences in between the two divisions in spite of the fact that currently Lewis is managing both. While separation of the production function might have been a desirable move for the advertising department, the truth that it would imply placing a third feature under Lewis's wing indicates this should be avoided.

Activity Strategy.

Lewis will certainly take control of the role of EVP Marketing after Krasnow leaves.

Marketing and advertising features would be merged.

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

Production function will certainly continue to be part of advertising under marketing feature.

Lewis will certainly divide herself from operations.

A democratic management style with staff member empowerment will be used in advertising department.

Open up door policy and focus on cross department communication will be aimed at getting rid of dissonance.

Backup strategy.

If the combination does not exercise as intended, a backup plan would certainly comply with which would separate the manufacturing feature from the marketing feature to decrease the load on the SVP of advertising and marketing. In case Judith Shapiro does not obtain employed, Lewis will certainly be heading the advertising and marketing division without an SVP. In that case the production feature will certainly be separated by putting it under an SVP production.