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Arcelor Mittal Takeover Case Study Analysis

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Arcelor Mittal Takeover Case Study Solution

Background and Facts

Arcelor Mittal Takeover a workplace supplies retailer for small and also medium sized businesses has recently been associated with preparing for a merger with its rival House Deport, which has actually influenced effectiveness degrees in departmentswith the senior supervisor associated with lawful problems put forth by the government Profession Commission. With the Advertising and marketing Head putting forward the news of his departure from the firm in one year, Jeannie Lewis, the present head of procedures has been asked to take the role in the future. With difficulties in the kind of a potential social adjustment and reduced staff member morale, the company needs a total reengineering initiative at the advertising division.

Problem Declaration
Porter's 5 Forces Analysis
The possible cultural modification at the advertising department of Arcelor Mittal Takeover is boosting unpredictability in the working environment leading to different challenges for the Jeannie Lewis who would be replacing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant duty in influencing tactical choices considering that Stapes Inc. had to desert its plans of combining with Workplace Deport after the Federal Trade Payment's treatment in the process. Provided the fact that the store has an international existence with branches in UK, UNITED STATES, Canada and Germany, political factors in each of these countries may have the ability to affect efficiency or strategic goals. Federal Trade Commission's antitrust suit versus the merging used up useful time of the company's elderly administration recommending that 'political' factors can have severe implications for an international service.

Economic Factors: Financial factors such as the appearance of local business in the worldwide situation recommend that Arcelor Mittal Takeover is flourishing in a setting where there is potential growth of companies. Truth that shop customers are primarily looking for office materials for residence workplaces suggests that the market has a climbing fad of entrepreneurs and home based services.

Social factors: Social fads in the economic climate reveal that customers are looking for convenience along with appealing costs. Marketing research demonstrates how the client for Arcelor Mittal Takeover does not have awareness about locating services which can use a mix of benefit and also inexpensive.

Technical factors: Modern technology plays an essential duty in Arcelor Mittal Takeover's service strategy particularly as the organization is piloting Technology facilities which would certainly provide modern technology sales and also support in the type of memory upgrades, peripheral installations. (Summary of PEST in appendix 2).

OB Issues and also Manifestations.

A number of underlying Business Behavior problems can be seen in Arcelor Mittal Takeover's case as highlighted in this area.

Uneasiness concerning cultural adjustment: There is worry regarding a cultural modification that would occur as soon as Todd Krasnow leaves from his position as the Exec Vice President of Marketing with a lot of the employee currently showing discontent over this prospective move. This anticipated modification has produced anxiety in the workplace which has actually been combined with the past tension of preparing the firm for a possible merging with Residence Deport.
Pest Analysis
Stressful Task Atmosphere for Newcomers: There is shortage of workers that can match the stressful environment of a busy organization. Not just does this lead to trouble in locating the appropriate individuals, it puts anxiety on brand-new hires as can not stand up to the rate and stress that the organization anticipates them to bear.

Double Reporting Lines: Beginners find this organizational society troublesome as well as hard to cope with especially as dotted line connections are indicated to be weaker as a whole and also unbiased setup as well as efficiency assessment is still done by the strong line manager. This means that newcomers can shed clearness concerning their respective functions and also objectives particularly as populated line reporting does not keep them in straight interaction with the solid line supervisors.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor instead of Bridget Coles even though it had been guessed that the latter would take Krasnow's setting came as an impact to her morale. Lewis may have been qualified as well as proper for the work but the fact that Kransnow's departure would certainly make Coles a straight record to Lewis might have been the factor for Coles' resignation from solutions.

Anxiety & Task Insecurity: Concern and also instability can be determined as 2 major concerns that Lewis would be handling especially as the merging has actually now be terminated as well as 2 elderly execs of the marketing department would certainly be leaving. The entire obligation of the division would be falling on Lewis's shoulders that would certainly not simply be in charge of brining about a cultural modification but would additionally have to verify herself in her new role.

Incompatible Administration Design of Leader: Lewis's monitoring design and its conflict with the marketing division's role can also be seen as an OB challenge specifically as she has been utilized to taking care of concerns in the operations division where personnel are taught to focus on processes and obtain them right. The advertising department on the various other hand can be viewed as a group of people that are made use of to being nurtured by Krasnow who concentrated much more on result than procedures.

Interdepartmental Disagreements: Interdepartmental disputes in between 3 divisions, marketing, merchandizing and procedures respectively over the allowance of the advertising and marketing mix can be recognized as one more OB concern. The advertising and marketing department does not share the very same vision as the various other two divisions regarding the aloocation of the advertising mix twoards promotions as well as advertsing, the merchandizing and also procedures divisions do not agree over the marketing mix appropriation amongst one an additional either.

Fragmentation in Advertising And Marketing Division: Fragmentation in between the advertising and marketing divisions can be determined as another OB concern which could need more attention. The reality that the advertising and marketing areas in the advertising department are separated is protecting against both departments from getting from each other's experience and also proficiency. Assimilation of advertising and marketing with merchandising as well as procedures would certainly come to be harder if the advertising and marketing department itself is broken down which can be another prospective OB concern.

Arcelor Mittal Takeover Analysis

Various concepts have been made use of to discuss the situations to get further clearness concerning the circumstance handy.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, most supervisors believe that subordinates are passive and also careless, have little passion as well as withstand adjustment. The circumstance at Arcelor Mittal Takeover is not completely adhering to Concept X, it can be seen that brand-new hires are finding this setting rather difficult which may at some point lead to a better disposition of the monitoring in the direction of Theory X. Even while examining Lewis's administration style, concept X may have been appropriate in the procedures division to some extent yet the Advertising and marketing department would call for dependence on Concept Y in order to get the imagination and creativity from the groups.

Tuckman's Synergy Theory: Regarding Lewis's issue about bringing consistency in between the advertising and marketing division is worried, this would initially bring about contrast as talked about by Bruce Tuckman in his 'Synergy Concept'. (Tuckman, 1965). As per Tuckman's concept received appendix 3, throughout the initial phase of team growth, people may not bond, as they are busy discovering their area in the team. By incorporating the advertising and marketing department's job, there may be the same initial detach which can cause the second stage of 'storming' where the teams test each other. It is just throughout the third stage or 'norming' when they would certainly come with each other to share suggestions before the group can bring about harmony in the fourth phase 'executing'.

When individuals are presented with change, they enter stage one and also so there may be feelings like unhappiness, unpredictability, irritation, anger, anxiety, rejection and also disorientation.The circumstance at the marketing division of Arcelor Mittal Takeover is comparable so Lewis can obtain comfy with the suggestion that it is not amazing behavior. It is throughout this stage that Lewis will have to provide guidance to the department so that they can locate a sense of instructions. It can be seen exactly how Krasnow has currently made this shift easier by making Lewis get involved in the division a year before his actual separation.
Vrio Analysis
Abraham Maslow in his Concept of 'Demands Hierarchy' (appendix 5) has reviews the significance of 'safety needs as being a lower level demand of a human for activating inspiration. As seen in the pyramid shared in appendix 3, we can see how 'the demand to feel safe and also out of risk' is at the second level of needs. Before a worker can be made to establish emotionally, he needs to have his 'Physical 'and also 'Safety' needs met.

SWOT Analysis for Arcelor Mittal Takeover Case Study



Effects of Analysis.

The OB analysis has checked out various concepts to comprehend how to cope with the present scenario at hand. The adhering to 3 options have been suggested to assist Lewis take care of the business obstacles in the advertising department. Each of these options has been proposed for easing the change needed to bring the advertising and marketing division in accordance with the requirements of the market and also for making the cultural modification that would adhere to when the current leader leaves.

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

Examination of Alternatives.

Judith Shapiro that has earlier been interviewed by Lewis during the earlier merger days has know-how in business-to-business advertising along with company and retail advertising and marketing experience. Once Krasnow leaves, Lewis can work with Shapiro as an EVP for marketing to deal with both marketing and also advertising features.

The advantage of this strategy is that it will integrate both functions while decreasing the demand for employing an extra source for marketing. Along with this, Lewis would be heading the advertising and marketing department and regardless her replacement would be required for the present duty that she is carrying out. The disadvantage of this alternative is that outside hiring might bring about bitterness from inner employees that might be eying the position of EVP after Lewis takes control of Krasnow's setting.

Dividing Adverting as well as Manufacturing: Offered the affordable stress and also excellent quality job required from the ad agency, it is suggested that Lewis ought to allow the production unit to be a separate feature from the advertising and marketing unit. Considering that most ad agency had these two functions as different devices, it makes more sense to adhere to the standard. Both features may be able to concentrate on their core triggers extra effectively. The negative aspect of this technique would be that extra costs would certainly have to be borne for setting up separate production functions. In addition to this, a production head may need to be worked with which might raise overheads for the organization.

Integration of Advertising And Marketing with Procedures: Given that Lewis is already taking care of the advertising and also operations divisions at the same time; it makes good sense to incorporate the two functions considering that she has been efficiently caring for both ends. The reality that both divisions currently have significant differences over allocation of sources suggests that this assimilation might be able to bring about consistency especially as Lewis would certainly be heading both ends.However there are numerous drawbacks of this step specifically as it would certainly put too much concern over Lewis's shoulders. The truth that Lewis needs to adjust her monitoring design for the marketing department suggests that these two departments would be culturally varied. Lewis may not be able to apply one type of management style to both departments which can result in inefficiency in either one of the 2 features.

Suggestion.



An analysis of the three choices suggests that integration of marketing and operations would not be a practical action due to the large differences in between the two departments in spite of the fact that presently Lewis is dealing with both. While splitting up of the manufacturing feature may have been a desirable action for the marketing department, the fact that it would mean positioning a third function under Lewis's wing means this should be prevented.

Action Strategy.
Recommendation
Lewis will certainly take over the role of EVP Advertising and marketing after Krasnow leaves.

Advertising and Marketing functions would certainly be combined.

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

Manufacturing function will certainly stay component of advertising under advertising and marketing feature.

Lewis will certainly divide herself from procedures.

An autonomous management design with worker empowerment will certainly be utilized in marketing division.

Open door plan as well as emphasis on cross departmental interaction will be aimed at getting rid of dissonance.

Backup strategy.

If the integration does not exercise as intended, a backup plan would comply with which would divide the production function from the advertising function to reduce the lots on the SVP of marketing and advertising. In case Judith Shapiro does not get hired, Lewis will be heading the advertising and marketing division without an SVP. In that case the production function will definitely be divided by placing it under an SVP production.