Cleveland Cliffs Inc Case Study Solution


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Cleveland Cliffs Inc Case Study Analysis

Background and Facts

Cleveland Cliffs Inc a workplace supplies retailer for tiny and also average sized organisations has just recently been associated with planning for a merging with its rival Residence Deport, which has actually impacted efficiency levels in departmentswith the senior manager associated with legal issues put forth by the federal Profession Payment. With the Advertising and marketing Head putting forward the information of his separation from the firm in one year, Jeannie Lewis, the present head of procedures has actually been asked to take the function in the near future. With challenges in the kind of a possible cultural modification and low employee spirits, the organization is in need of a complete reengineering initiative at the marketing division.

Trouble Statement
Porter's 5 Forces Analysis
The prospective cultural modification at the advertising department of Cleveland Cliffs Inc is raising uncertainty in the working environment causing various difficulties for the Jeannie Lewis who would certainly be changing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in impacting critical choices considering that Stapes Inc. needed to abandon its plans of merging with Office Deport after the Federal Profession Compensation's treatment while doing so. Given the reality that the store has a worldwide presence with branches in UK, U.S.A., Canada and Germany, political factors in each of these countries might have the ability to influence efficiency or tactical objectives. Federal Trade Compensation's antitrust suit versus the merger occupied important time of the organization's elderly management suggesting that 'political' factors can have severe effects for a global business.

Economic Factors: Financial factors such as the introduction of small businesses in the international circumstance suggest that Cleveland Cliffs Inc is prospering in an environment where there is prospective growth of companies. Along with this, fact that store clients are mostly trying to find office materials for home offices recommends that the marketplace has a rising pattern of entrepreneurs and also home organisations.

Social factors: Social fads in the economic climate show that consumers are looking for benefit in addition to attractive prices. Marketing research demonstrates how the client for Cleveland Cliffs Inc does not have understanding concerning discovering remedies which can offer a combination of benefit and also affordable.

Technical factors: Modern technology plays an essential role in Cleveland Cliffs Inc's service method specifically as the organization is piloting Technology facilities which would certainly offer technology sales and support in the type of memory upgrades, peripheral installments. (Recap of PARASITE in appendix 2).

OB Issues and also Manifestations.

A number of underlying Business Behavior concerns can be seen in Cleveland Cliffs Inc's case as highlighted in this section.

Worries regarding social change: There is concern about a social change that would occur as soon as Todd Krasnow leaves from his position as the Executive Vice President of Advertising And Marketing with most of the staff members currently showing unhappiness over this possible action. This anticipated modification has actually created stress and anxiety in the work environment which has actually been paired with the previous stress of preparing the firm for a potential merging with Residence Deport.
Pest Analysis
Difficult Job Environment for Newcomers: There is scarcity of employees that can match the demanding environment of a fast-paced company. Not just does this cause problem in finding the right people, it places tension on brand-new hires as can not stand up to the pace and stress that the organization anticipates them to birth.

Twin Coverage Lines: Newbies discover this organizational society difficult and difficult to cope with particularly as dotted line connections are meant to be weak in general as well as unbiased setup and also efficiency assessment is still done by the solid line supervisor. This indicates that novices might lose clearness about their corresponding duties as well as goals especially as dotted line reporting does not maintain them in direct interaction with the solid line managers.

Resentment From Cross Departmental Hiring: Krasnow's decision to make Lewis his follower as opposed to Bridget Coles although it had actually been speculated that the last would certainly take Krasnow's placement came as an impact to her morale. Lewis might have been qualified and ideal for the task but the fact that Kransnow's departure would certainly make Coles a direct record to Lewis might have been the reason for Coles' resignation from services.

Worry & Job Insecurity: Concern and instability can be recognized as 2 major worries that Lewis would certainly be taking care of especially as the merger has actually currently be terminated as well as two senior executives of the advertising division would be leaving. The entire obligation of the division would be dropping on Lewis's shoulders that would certainly not simply be in charge of brining regarding a cultural adjustment however would additionally need to prove herself in her new role.

Incompatible Administration Style of Leader: Lewis's administration design and its incompatibility with the advertising and marketing department's function can likewise be viewed as an OB difficulty especially as she has been used to handling problems in the operations department where employees are taught to focus on procedures as well as obtain them right. The advertising division on the other hand can be viewed as a team of people who are made use of to being nurtured by Krasnow that concentrated a lot more on result than procedures.

Interdepartmental Arguments: Interdepartmental disagreements in between three departments, advertising and marketing, merchandizing and also procedures specifically over the allotment of the advertising and marketing mix can be recognized as an additional OB problem. The advertising and marketing division does not share the very same vision as the various other two departments concerning the aloocation of the advertising mix twoards promos as well as advertsing, the merchandizing as well as procedures divisions do not agree over the advertising and marketing mix allotment amongst one an additional either.

Disintegration in Marketing Department: Disintegration in between the advertising and marketing departments can be identified as an additional OB problem which might require additional focus. The reality that the marketing and advertising sections in the advertising and marketing division are separated is stopping both departments from getting from each various other's experience and also proficiency. Combination of marketing with retailing and operations would certainly end up being harder if the marketing division itself is disintegrated which can be an additional prospective OB problem.

Cleveland Cliffs Inc Analysis

Various concepts have been made use of to describe the conditions to get more quality about the circumstance handy.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Concept X, many managers think that juniors are passive and also careless, have little aspiration as well as stand up to adjustment. The scenario at Cleveland Cliffs Inc is not entirely complying with Concept X, it can be seen that brand-new hires are finding this atmosphere rather difficult which might at some point lead to a greater inclination of the management in the direction of Theory X. Also while assessing Lewis's administration style, concept X may have been ideal in the procedures division to some level yet the Advertising and marketing department would certainly need reliance on Theory Y in order to obtain the creativity as well as originality from the teams.

Tuckman's Team effort Concept: As for Lewis's problem regarding bringing harmony in between the marketing and advertising department is worried, this would at first cause contrast as gone over by Bruce Tuckman in his 'Teamwork Concept'. (Tuckman, 1965). As per Tuckman's theory received appendix 3, during the preliminary stage of group advancement, individuals may not bond, as they are hectic locating their place in the group. By combining the marketing and advertising department's work, there might coincide initial disconnect which can bring about the 2nd phase of 'storming' where the groups test one another. It is only throughout the 3rd stage or 'norming' when they would certainly come with each other to share suggestions before the team can bring about harmony in the 4th stage 'executing'.

Bridges' Shift Design: Based On William Bridge's concept (appendix 4), individuals are rather uneasy with change, which is evident by the scenario at Cleveland Cliffs Inc The scenario can be viewed as a typical course of life if is studied as per Bridge's concept where he describes that people go through 3 phases of transition when they experience adjustment. 'End, shedding and Letting go', The Neutral Area as well as 'The New Beginning' (Bridges, 2004). When people exist with modification, they enter stage one therefore there might be feelings like sadness, uncertainty, aggravation, temper, fear, denial as well as disorientation.The circumstance at the advertising division of Cleveland Cliffs Inc is comparable so Lewis can obtain comfortable with the idea that it is not extraordinary behavior. In the second stage, there might be a demand to bridge the gap between the new and old society so Lewis might have to encounter this challenge when Krasnow leaves. There might be low morale and also low efficiency at this stage which need to not be taken as a setback. It is during this phase that Lewis will certainly need to offer assistance to the division to make sure that they can discover a sense of direction. It can be seen exactly how Krasnow has actually already made this shift less complicated by making Lewis get associated with the division a year before his real separation. According to Bridges' Version, phase three will bring about openness to discovering, High power and also commitment as individuals will certainly accept the change (Bridges, 2004).
Vrio Analysis
Maslow's Need power structure: The OB issue pertaining to instability at the office has been activated first of all by the adjustment in management and second of all by the reality that the merging will no more be launched. Abraham Maslow in his Concept of 'Needs Hierarchy' (appendix 5) has reviews the value of 'security needs as being a lower level demand of a human for triggering motivation. As seen in the pyramid shared in appendix 3, we can see exactly how 'the need to really feel safe and out of danger' goes to the second level of demands. Prior to an employee can be made to establish emotionally, he needs to have his 'Physiological 'and also 'Security' needs satisfied. This shows that unless the personnel are made to really feel safe concerning their existing employment status in Cleveland Cliffs Inc they may not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Cleveland Cliffs Inc Case Study

Ramification of Analysis.

The OB analysis has actually checked out numerous theories to comprehend just how to deal with the existing scenario available. The complying with 3 options have been recommended to help Lewis manage the organizational difficulties in the advertising department. Each of these alternatives has actually been recommended for easing the shift required to bring the advertising and marketing division in accordance with the demands of the marketplace and also for making the social modification that would follow when the present leader leaves.

Assimilation of advertising and marketing features. Dividing Adverting as well as Manufacturing functions. Combination of Marketing with Procedures.

Evaluation of Alternatives.

Judith Shapiro who has actually earlier been talked to by Lewis throughout the earlier merger days has competence in business-to-business advertising along with company and also retail advertising experience. Once Krasnow leaves, Lewis can employ Shapiro as an EVP for marketing to handle both advertising and marketing and marketing features.

The benefit of this approach is that it will certainly incorporate both features while minimizing the need for hiring an additional source for advertising and marketing. Lewis would certainly be heading the advertising department and in any case her replacement would be needed for the current duty that she is doing. The negative aspect of this alternative is that outside hiring might produce animosity from interior employees who may be looking at the setting of EVP after Lewis takes over Krasnow's setting.

Dividing Adverting as well as Production: Provided the competitive stress as well as high top quality work required from the marketing agency, it is recommended that Lewis should allow the production system to be a different function from the advertising unit. Considering that a lot of advertising companies had these 2 features as separate units, it makes even more sense to follow the standard.

Assimilation of Advertising And Marketing with Procedures: Considering that Lewis is already taking care of the advertising and marketing and also procedures divisions concurrently; it makes sense to incorporate the two functions given that she has actually been effectively caring for both ends. The fact that both divisions already have major differences over allotment of resources recommends that this combination may be able to bring about consistency especially as Lewis would certainly be heading both ends.However there are different downsides of this step specifically as it would certainly place way too much worry over Lewis's shoulders. The truth that Lewis needs to adapt her monitoring design for the advertising and marketing department suggests that these 2 departments would be culturally diverse. Lewis may not be able to apply one type of management style to both departments which could result in ineffectiveness in either one of the two functions.


An evaluation of the three options shows that integration of marketing and operations would certainly not be a feasible relocation because of the huge differences between the two divisions although that currently Lewis is managing both. While separation of the manufacturing feature might have been a positive relocation for the advertising and marketing division, the fact that it would certainly mean placing a 3rd function under Lewis's wing indicates this should be stayed clear of. The assimilation of the marketing division is the very best choice in regards to getting the ideal results from the division. An action plan for this alternative is reviewed below.

Action Plan.
Lewis will take over the duty of EVP Advertising and marketing after Krasnow leaves.

Marketing and advertising functions would certainly be combined.

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

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

Lewis will certainly divide herself from operations.

A democratic leadership style with employee empowerment will be used in marketing division.

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

Backup plan.

If the integration does not work out as planned, a contingency plan would comply with which would divide the production function from the marketing feature to lower the lots on the SVP of advertising and marketing. In case Judith Shapiro does not get employed, Lewis will certainly be heading the advertising and marketing department without an SVP. In that case the production function will most definitely be separated by putting it under an SVP production.