Activity Based Management At Stream International Case Study Analysis


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Activity Based Management At Stream International Case Study Solution

Background and Facts

Activity Based Management At Stream International an office products retailer for tiny and also medium sized organisations has actually just recently been associated with preparing for a merger with its competitor Residence Deport, which has actually impacted performance levels in departmentswith the senior manager associated with legal problems presented by the government Trade Payment. With the Advertising and 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 role in the future. With obstacles in the type of a possible cultural modification as well as reduced staff member morale, the company wants a full reengineering initiative at the marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The possible social adjustment at the advertising department of Activity Based Management At Stream International is enhancing unpredictability in the workplace resulting in numerous difficulties for the Jeannie Lewis that would be changing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in influencing strategic choices considering that Stapes Inc. had to desert its plans of merging with Office Deport after the Federal Profession Payment's intervention at the same time. Provided the truth that the shop has a global presence with branches in UK, UNITED STATES, Canada as well as Germany, political consider each of these countries may be able to impact performance or critical goals. Federal Profession Compensation's antitrust fit against the merger used up valuable time of the company's elderly administration suggesting that 'political' factors can have significant implications for a worldwide company.

Economic Factors: Financial factors such as the appearance of small companies in the international circumstance recommend that Activity Based Management At Stream International is flourishing in a setting where there is possible growth of services. Along with this, fact that store customers are mainly trying to find office materials for office suggests that the marketplace has an increasing fad of entrepreneurs and also online companies.

Social factors: Social fads in the economic situation reveal that consumers are looking for convenience along with appealing rates. Market research demonstrates how the client for Activity Based Management At Stream International lacks recognition concerning locating options which can offer a combination of comfort and inexpensive.

Technical factors: Technology plays an important duty in Activity Based Management At Stream International's business technique especially as the company is piloting Innovation facilities which would use technology sales as well as support in the type of memory upgrades, peripheral installations. (Summary of PARASITE in appendix 2).

OB Issues as well as Symptoms.

A number of underlying Organizational Behavior problems can be seen in Activity Based Management At Stream International's case as highlighted in this section.

Worries concerning cultural modification: There is apprehension about a cultural adjustment that would certainly happen as soon as Todd Krasnow leaves from his position as the Exec Vice Head Of State of Marketing with a lot of the employee currently revealing unhappiness over this prospective step. This anticipated adjustment has created anxiety in the office which has actually been coupled with the past stress of preparing the company for a possible merging with Residence Deport.
Pest Analysis
Stressful Task Setting for Newcomers: There is lack of workers that can match the stressful setting of a fast-paced organization. Not only does this lead to trouble in finding the appropriate individuals, it places tension on new hires as can not endure the rate as well as stress that the organization expects them to bear.

Double Reporting Lines: Beginners find this organizational society troublesome and tough to manage especially as dotted line connections are indicated to be weak generally and unbiased setting and performance evaluation is still done by the solid line manager. This indicates that newcomers can shed quality concerning their respective roles and also objectives especially as populated line reporting does not maintain them in straight communication with the solid line supervisors.

Resentment From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor instead of Bridget Coles although it had been speculated that the last would certainly take Krasnow's setting came as an impact to her spirits. Lewis may have been capable as well as appropriate for the work but the fact that Kransnow's departure would certainly make Coles a direct report to Lewis may have been the factor for Coles' resignation from solutions.

Anxiety & Work Insecurity: Concern and also insecurity can be determined as two significant worries that Lewis would be dealing with especially as the merging has actually now be cancelled and also two senior execs of the advertising and marketing division would certainly be leaving. The whole obligation of the department would certainly be falling on Lewis's shoulders who would certainly not just be in charge of brining concerning a social modification however would certainly additionally have to confirm herself in her new role.

Inappropriate Administration Design of Leader: Lewis's administration design and its conflict with the advertising department's duty can likewise be seen as an OB challenge specifically as she has actually been used to handling problems in the operations division where employees are taught to focus on procedures and obtain them. The advertising division on the various other hand can be viewed as a team of individuals that are made use of to being supported by Krasnow that focused a lot more on outcome than processes.

Interdepartmental Disagreements: Interdepartmental arguments between three departments, advertising, merchandizing and procedures specifically over the allotment of the advertising and marketing mix can be recognized as another OB worry. Although the advertising division does not share the same vision as the other 2 divisions concerning the aloocation of the marketing mix twoards promos and also advertsing, the merchandizing and operations divisions do not agree over the advertising and marketing mix appropriation among each other either.

Fragmentation in Marketing Division: Disintegration between the advertising and marketing divisions can be determined as an additional OB issue which might need further focus. The reality that the marketing and advertising sections in the advertising division are disconnected is avoiding both departments from acquiring from each various other's experience and also expertise. Combination of marketing with retailing and operations would become harder if the advertising department itself is broken down which can be another potential OB concern.

Activity Based Management At Stream International Analysis

Different theories have been made use of to discuss the scenarios to obtain additional clearness about the situation available.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Concept X, the majority of managers believe that subordinates are easy as well as careless, have little ambition and withstand modification. The situation at Activity Based Management At Stream International is not entirely adhering to Theory X, it can be seen that brand-new hires are discovering this atmosphere instead difficult which may ultimately lead to a higher inclination of the monitoring towards Concept X. Also while examining Lewis's monitoring design, concept X might have been ideal in the procedures department to some extent however the Advertising department would need dependence on Theory Y in order to get the creative thinking and also creativity from the groups.

Tuckman's Synergy Theory: As far as Lewis's issue regarding bringing harmony in between the marketing and advertising department is concerned, this would initially cause contrast as discussed by Bruce Tuckman in his 'Team effort Theory'. (Tuckman, 1965). According to Tuckman's concept shown in appendix 3, throughout the initial phase of team advancement, individuals may not bond, as they are active locating their area in the team. By combining the advertising and marketing department's job, there might coincide first detach which might lead to the second stage of 'storming' where the groups challenge one another. Nonetheless, it is only throughout the 3rd phase or 'norming' when they would certainly come together to share suggestions prior to the group can produce harmony in the 4th phase 'executing'.

Bridges' Change Version: Based On William Bridge's concept (appendix 4), individuals are fairly awkward with adjustment, which is evident by the circumstance at Activity Based Management At Stream International The scenario can be seen as a typical course of life if is examined as per Bridge's theory where he discusses that people experience 3 phases of change when they experience change. 'Ending, shedding and also Releasing', The Neutral Area as well as 'The New Starting' (Bridges, 2004). When individuals are presented with adjustment, they enter phase one and so there might be emotions like despair, uncertainty, stress, rage, anxiety, denial and also disorientation.The circumstance at the advertising department of Activity Based Management At Stream International is comparable so Lewis can obtain comfortable with the concept that it is not amazing behavior. In the 2nd stage, there might be a requirement to connect the space in between the brand-new and old society so Lewis might need to face this ordeal when Krasnow leaves. There may be low spirits and low efficiency at this stage which must not be taken as an obstacle. It is during this phase that Lewis will certainly need to give assistance to the division to make sure that they can locate a sense of direction. It can be seen how Krasnow has currently made this shift easier by making Lewis obtain involved in the division a year before his real separation. As per Bridges' Version, phase three will cause visibility to discovering, High power as well as dedication as individuals will certainly accept the change (Bridges, 2004).
Vrio Analysis
Abraham Maslow in his Theory of 'Requirements Power structure' (appendix 5) has talks about the relevance of 'safety needs as being a lower level need of a human for activating motivation. As seen in the pyramid shared in appendix 3, we can see how 'the demand to really feel safe and secure and out of threat' is at the second level of needs. Prior to a worker can be made to develop mentally, he requires to have his 'Physical 'and 'Safety and security' requires fulfilled.

SWOT Analysis for Activity Based Management At Stream International Case Study

Ramification of Analysis.

The OB analysis has actually looked at different concepts to comprehend how to cope with the existing situation at hand. The adhering to 3 alternatives have actually been suggested to help Lewis take care of the business obstacles in the advertising and marketing department. Each of these choices has been recommended for reducing the change required to bring the advertising department in accordance with the needs of the market and also for making the cultural change that would certainly follow when the current leader leaves.

Integration of advertising and marketing features. Separating Adverting as well as Manufacturing functions. Assimilation of Advertising with Procedures.

Analysis of Alternatives.

Combination of Marketing & Advertising Functions: The internal marketing company of Activity Based Management At Stream International is currently stamina for the company in regards to conserving up on expenses connected to marketing as well as promo. Because no brand-new recruitment has been done after Bridget Cole's departure with the reporting line being straight designated to Krasnow for the marketing feature, this is a desirable possibility for integrating the marketing and advertising features. Judith Shapiro who has earlier been spoken with by Lewis during the earlier merger days has experience in business-to-business advertising and marketing in addition to firm as well as retail advertising experience. When Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to deal with both marketing and advertising features.

The advantage of this approach is that it will certainly incorporate the two functions while reducing the demand for hiring an added source for advertising and marketing. Lewis would be heading the marketing department and in any kind of case her substitute would be required for the present role that she is doing. The drawback of this alternative is that outside hiring might cause resentment from interior workers that might be looking at the placement of EVP after Lewis takes control of Krasnow's setting.

Separating Adverting and Production: Provided the affordable stress and excellent quality job called for from the advertising agency, it is recommended that Lewis needs to permit the production unit to be a different feature from the advertising unit. Considering that most ad agency had these 2 features as separate systems, it makes even more feeling to comply with the norm. In addition to this, both features may be able to focus on their core activates more effectively. The negative aspect of this method would be that additional expenses would have to be borne for setting up separate production features. In addition to this, a production head might need to be worked with which could boost overheads for the organization.

Combination of Marketing with Operations: Given that Lewis is currently caring for the advertising and marketing as well as operations departments concurrently; it makes sense to integrate the two functions considering that she has been successfully dealing with both ends. The reality that both divisions currently have significant distinctions over allocation of sources recommends that this assimilation might be able to bring about consistency specifically as Lewis would certainly be heading both ends.However there are different downsides of this step specifically as it would certainly put way too much concern over Lewis's shoulders. The truth that Lewis has to adapt her management style for the advertising and marketing division recommends that these 2 departments would be culturally diverse. Along with this, Lewis may not have the ability to use one type of management design to both departments which could result in inadequacy in either among the two functions.


An assessment of the three options indicates that integration of advertising and marketing and operations would not be a practical step due to the vast differences in between the two departments despite the fact that currently Lewis is taking care of both. While separation of the manufacturing feature may have been a positive relocation for the marketing department, the reality that it would suggest positioning a 3rd function under Lewis's wing implies this need to be avoided.

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

Advertising and Marketing functions would certainly be merged.

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

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

Lewis will separate herself from operations.

An autonomous leadership design with employee empowerment will be utilized in advertising division.

Open door plan as well as focus on cross department communication will certainly be targeted at eliminating discord.

Backup plan.

If the integration does not exercise as intended, a contingency plan would certainly comply with which would certainly divide the manufacturing feature from the advertising feature to decrease the load on the SVP of advertising and marketing. In case Judith Shapiro does not get hired, Lewis will be heading the marketing division without an SVP. Because case the production feature will certainly be divided by putting it under an SVP production.