Accounts Receivable Valuation Case Study Analysis


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Accounts Receivable Valuation Case Study Analysis

Background and Facts

Accounts Receivable Valuation an office products retailer for small and also moderate sized companies has actually lately been associated with preparing for a merging with its rival Home Deport, which has actually influenced efficiency levels in departmentswith the elderly manager associated with lawful complications put forth by the federal Profession Compensation. With the Marketing Head putting forward the news of his departure from the business in one year, Jeannie Lewis, the present head of operations has been asked to take the role in the future. With challenges in the type of a possible cultural adjustment and also low worker spirits, the company needs a complete reengineering initiative at the advertising and marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The potential social adjustment at the advertising and marketing division of Accounts Receivable Valuation is enhancing unpredictability in the working environment bring about numerous obstacles for the Jeannie Lewis that would certainly be changing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant duty in affecting tactical decisions given that Stapes Inc. needed to abandon its strategies of merging with Office Deport after the Federal Profession Commission's intervention while doing so. Given the fact that the store has an international presence with branches in UK, U.S.A., Canada and Germany, political factors in each of these nations may have the ability to influence efficiency or calculated objectives. Federal Trade Commission's antitrust suit against the merging used up useful time of the organization's elderly management recommending that 'political' factors can have serious implications for a worldwide company.

Economic Factors: Economic factors such as the development of local business in the worldwide scenario suggest that Accounts Receivable Valuation is prospering in an environment where there is potential growth of companies. Fact that store consumers are mostly looking for workplace supplies for home offices suggests that the market has a climbing pattern of business owners and also residence based services.

Social factors: Social trends in the economic situation reveal that consumers are trying to find ease along with appealing prices. Marketing research shows how the customer for Accounts Receivable Valuation lacks awareness about locating services which can supply a combination of ease as well as affordable.

Technological factors: Technology plays an important role in Accounts Receivable Valuation's company approach especially as the organization is piloting Innovation centers which would supply technology sales and support in the type of memory upgrades, outer installments. (Recap of BUG in appendix 2).

OB Issues and also Effects.

A number of underlying Organizational Actions issues can be seen in Accounts Receivable Valuation's case as highlighted in this area.

Apprehensions concerning social change: There is uneasiness regarding a cultural modification that would occur once Todd Krasnow leaves from his position as the Exec Vice President of Marketing with most of the personnel currently revealing unhappiness over this possible action. This expected adjustment has actually created stress in the office which has actually been combined with the past tension of preparing the company for a possible merger with Home Deport.
Pest Analysis
Stressful Work Atmosphere for Newcomers: There is scarcity of personnel that can match the stressful atmosphere of a busy organization. Not only does this result in problem in finding the appropriate people, it places anxiety on new hires as can not stand up to the pace as well as stress that the organization expects them to bear.

Twin Coverage Lines: Novices locate this organizational society cumbersome as well as tough to manage specifically as populated line partnerships are suggested to be weak as a whole and objective setup as well as efficiency evaluation is still done by the solid line supervisor. This suggests that newbies might shed quality regarding their particular functions as well as objectives especially as dotted line coverage does not keep them in direct interaction with the solid line managers.

Bitterness From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor rather than Bridget Coles despite the fact that it had actually been hypothesized that the latter would certainly take Krasnow's placement came as an impact to her morale. Lewis may have been capable and proper for the job yet the fact that Kransnow's departure would certainly make Coles a direct record to Lewis may have been the reason for Coles' resignation from solutions.

Fear & Job Insecurity: Anxiety and also insecurity can be identified as 2 significant issues that Lewis would be handling particularly as the merger has actually currently be terminated and also two elderly execs of the marketing department would be leaving. The whole duty of the department would certainly be falling on Lewis's shoulders who would not simply be in charge of brining regarding a cultural change however would likewise need to prove herself in her new role.

Inappropriate Administration Design of Leader: Lewis's management design and its conflict with the advertising and marketing division's duty can additionally be seen as an OB obstacle particularly as she has actually been utilized to dealing with concerns in the operations department where workers are shown to focus on processes and also obtain them. The advertising department on the various other hand can be viewed as a group of people that are used to being nurtured by Krasnow who focused more on result than processes.

Interdepartmental Arguments: Interdepartmental arguments between 3 divisions, advertising, merchandizing as well as operations respectively over the allotment of the advertising and marketing mix can be recognized as an additional OB problem. The advertising department does not share the same vision as the other 2 departments regarding the aloocation of the advertising and marketing mix twoards promotions and advertsing, the merchandizing and also procedures divisions do not agree over the marketing mix appropriation amongst one another either.

Disintegration in Advertising And Marketing Department: Disintegration in between the marketing and advertising divisions can be determined as another OB issue which might require additional interest. The reality that the marketing and advertising sections in the marketing division are separated is protecting against both divisions from gaining from each other's experience as well as knowledge. Assimilation of marketing with retailing and operations would end up being more difficult if the advertising and marketing department itself is degenerated which can be one more potential OB problem.

Accounts Receivable Valuation Analysis

Different concepts have actually been made use of to discuss the scenarios to get additional clarity about the situation handy.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, a lot of supervisors believe that subordinates are easy and lazy, have little ambition as well as stand up to modification. The situation at Accounts Receivable Valuation is not completely adhering to Concept X, it can be seen that new hires are locating this environment instead stressful which might at some point lead to a greater inclination of the monitoring in the direction of Theory X. Even while evaluating Lewis's management design, concept X might have been appropriate in the procedures department to some degree but the Advertising and marketing division would certainly require dependence on Concept Y in order to obtain the imagination and also creativity from the groups.

Tuckman's Team effort Theory: Regarding Lewis's issue concerning bringing consistency between the advertising and marketing division is concerned, this would initially lead to conflict as reviewed by Bruce Tuckman in his 'Team effort Concept'. (Tuckman, 1965). According to Tuckman's concept received appendix 3, throughout the first phase of team growth, individuals might not bond, as they are active locating their area in the team. By combining the advertising and marketing division's work, there may coincide first detach which can lead to the 2nd phase of 'storming' where the teams challenge each other. However, it is only throughout the 3rd stage or 'norming' when they would certainly collaborate to share ideas prior to the group can bring about synergy in the fourth stage 'carrying out'.

When individuals are offered with modification, they go into phase one and so there may be emotions like sadness, uncertainty, frustration, temper, fear, rejection as well as disorientation.The circumstance at the advertising and marketing division of Accounts Receivable Valuation is similar so Lewis can get comfy with the concept that it is not amazing behavior. It is throughout this phase that Lewis will certainly have to offer assistance to the division so that they can find a sense of instructions. It can be seen exactly how Krasnow has actually already made this change simpler by making Lewis get included in the department a year before his actual separation.
Vrio Analysis
Abraham Maslow in his Theory of 'Requirements Hierarchy' (appendix 5) has discusses the importance of 'security requires as being a reduced level demand of a human for causing inspiration. As seen in the pyramid shared in appendix 3, we can see how 'the requirement to feel secure and out of risk' is at the second degree of requirements. Prior to a worker can be made to develop mentally, he requires to have his 'Physiological 'and also 'Safety' needs met.

SWOT Analysis for Accounts Receivable Valuation Case Study

Implication of Analysis.

The OB analysis has looked at different theories to comprehend exactly how to deal with the existing scenario available. The complying with three alternatives have been proposed to help Lewis manage the business obstacles in the advertising and marketing division. Each of these choices has been suggested for relieving the shift required to bring the marketing division according to the requirements of the marketplace and for making the cultural adjustment that would comply with when the present leader leaves.

Assimilation of marketing and advertising functions. Separating Adverting and Manufacturing features. Integration of Marketing with Operations.

Assessment of Alternatives.

Judith Shapiro that has earlier been spoken with by Lewis during the earlier merger days has proficiency in business-to-business advertising and marketing along with company as well as retail marketing experience. When Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising to deal with both advertising and marketing features.

The benefit of this approach is that it will incorporate the two functions while lowering the demand for working with an additional resource for advertising and marketing. Lewis would certainly be heading the advertising and marketing division and also in any type of case her replacement would be required for the current function that she is executing. The negative aspect of this choice is that exterior hiring may produce animosity from inner employees that might be looking at the position of EVP after Lewis takes control of Krasnow's position.

Dividing Adverting and also Production: Offered the competitive pressures and also high quality work needed from the advertising and marketing agency, it is recommended that Lewis must allow the manufacturing system to be a different function from the marketing device. Because many advertising and marketing companies had these two features as different systems, it makes even more feeling to follow the standard.

Integration of Advertising with Procedures: Because Lewis is already looking after the advertising and marketing as well as procedures departments concurrently; it makes good sense to incorporate both functions since she has been successfully caring for both ends. The fact that both departments already have significant distinctions over appropriation of sources suggests that this integration might have the ability to produce harmony specifically as Lewis would certainly be heading both ends.However there are numerous disadvantages of this move especially as it would put excessive burden over Lewis's shoulders. The truth that Lewis has to adjust her monitoring design for the advertising and marketing department recommends that these two divisions would be culturally diverse. Lewis may not be able to use one type of management design to both divisions which can result in inadequacy in either one of the 2 functions.


An evaluation of the three alternatives suggests that integration of marketing and procedures would not be a viable action as a result of the substantial differences between the two departments although that presently Lewis is handling both. While splitting up of the production function might have been a positive relocation for the advertising division, the reality that it would imply positioning a 3rd feature under Lewis's wing means this need to be prevented. The combination of the marketing division is the best option in regards to getting the ideal results from the department. An action prepare for this option is gone over below.

Activity Plan.
Lewis will take over the role of EVP Advertising after Krasnow leaves.

Advertising and Marketing functions would certainly be combined.

Judith Shapiro will certainly be worked with to take Lewis's place as SVP of marketing and advertising.

Production function will certainly stay component of advertising under advertising and marketing function.

Lewis will certainly divide herself from operations.

A democratic leadership style with staff member empowerment will be made use of in advertising and marketing division.

Open up door policy as well as emphasis on cross department interaction will be targeted at removing dissonance.

Contingency plan.

If the assimilation does not exercise as planned, a contingency plan would certainly adhere to which would separate the production feature from the advertising function to reduce the tons on the SVP of advertising and marketing. In case Judith Shapiro does not obtain hired, Lewis will certainly be heading the advertising and marketing division without an SVP. In that case the production feature will definitely be separated by placing it under an SVP manufacturing.