Cleveland Cliffs Inc Case Study Solution


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Cleveland Cliffs Inc Case Study Help

Background and Facts

Cleveland Cliffs Inc a workplace supplies retailer for tiny and also moderate sized businesses has just recently been involved in planning for a merger with its rival Home Deport, which has affected efficiency degrees in departmentswith the senior supervisor involved in legal difficulties presented by the government Trade Compensation. With the Advertising Head advancing the news of his separation from the business in one year, Jeannie Lewis, the current head of operations has actually been asked to take the function in the future. With obstacles in the type of a potential social adjustment as well as low staff member morale, the organization requires a full reengineering effort at the advertising division.

Trouble Declaration

The potential cultural modification at the advertising division of Cleveland Cliffs Inc is raising uncertainty in the working environment resulting in different challenges for the Jeannie Lewis that would certainly be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in affecting strategic choices considering that Stapes Inc. had to abandon its plans of merging with Office Deport after the Federal Profession Payment's intervention in the process. Provided the truth that the store has a worldwide presence with branches in UK, U.S.A., Canada as well as Germany, political consider each of these countries might have the ability to influence performance or calculated objectives. Federal Trade Payment's antitrust fit versus the merging took up important time of the organization's elderly monitoring suggesting that 'political' factors can have significant effects for an international company.

Economic Factors: Economic factors such as the appearance of local business in the international scenario recommend that Cleveland Cliffs Inc is prospering in an environment where there is prospective development of companies. Reality that shop customers are mainly looking for office products for home workplaces suggests that the market has an increasing fad of business owners and residence based businesses.

Social factors: Social patterns in the economic situation reveal that customers are seeking comfort along with eye-catching costs. Market research shows how the consumer for Cleveland Cliffs Inc lacks recognition regarding locating remedies which can offer a combination of comfort as well as low costs.

Technical factors: Innovation plays a vital duty in Cleveland Cliffs Inc's company strategy particularly as the company is piloting Innovation centers which would certainly use modern technology sales and also support in the type of memory upgrades, outer installations. (Recap of INSECT in appendix 2).

OB Issues as well as Effects.

Several underlying Business Actions problems can be seen in Cleveland Cliffs Inc's case as highlighted in this area.

Concerns regarding cultural change: There is apprehension regarding a social change that would take place as soon as Todd Krasnow leaves from his placement as the Executive Vice Head Of State of Marketing with most of the employee currently revealing unhappiness over this prospective relocation. This expected change has actually created anxiety in the office which has actually been paired with the past stress and anxiety of preparing the firm for a prospective merger with Home Deport.

Demanding Task Setting for Newcomers: There is scarcity of workers that can match the stressful atmosphere of a busy organization. Not only does this bring about trouble in finding the ideal people, it puts tension on brand-new hires as can not hold up against the speed and stress that the organization expects them to birth.

Dual Coverage Lines: Beginners discover this organizational culture cumbersome and also hard to handle specifically as populated line relationships are indicated to be weak in general as well as objective setting as well as performance assessment is still done by the strong line manager. This means that newbies might lose quality concerning their particular duties as well as goals especially as dotted line coverage does not maintain them in straight communication with the strong line supervisors.

Bitterness From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor rather than Bridget Coles even though it had been guessed that the last would certainly take Krasnow's position came as a strike to her morale. Lewis may have been qualified and also suitable for the job yet the fact that Kransnow's separation would make Coles a direct report to Lewis may have been the reason for Coles' resignation from services.

Worry & Job Insecurity: Concern and insecurity can be recognized as two significant worries that Lewis would certainly be dealing with specifically as the merging has actually currently be terminated and also two senior executives of the marketing department would certainly be leaving. The whole responsibility of the department would be falling on Lewis's shoulders who would not simply be in charge of brining regarding a cultural adjustment but would additionally have to verify herself in her brand-new role.

Inappropriate Administration Design of Leader: Lewis's administration style as well as its incompatibility with the marketing department's role can likewise be seen as an OB challenge specifically as she has actually been made use of to taking care of problems in the operations department where personnel are instructed to focus on processes and obtain them. The advertising and marketing department on the various other hand can be viewed as a team of people that are used to being nurtured by Krasnow who concentrated much more on outcome than processes.

Interdepartmental Disputes: Interdepartmental disputes in between three departments, advertising and marketing, merchandizing and procedures respectively over the allotment of the marketing mix can be determined as an additional OB concern. The advertising and marketing department 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 as well as procedures departments do not concur over the marketing mix allotment among one another either.

Fragmentation in Advertising Department: Disintegration between the advertising and marketing departments can be identified as one more OB problem which can require additional interest. The reality that the marketing and advertising areas in the advertising and marketing division are separated is preventing both divisions from acquiring from each various other's experience and knowledge. Combination of advertising and marketing with merchandising as well as procedures would certainly end up being more difficult if the advertising and marketing division itself is disintegrated which can be an additional potential OB issue.

Cleveland Cliffs Inc Analysis

Numerous theories have actually been utilized to describe the scenarios to get additional clearness about the scenario at hand.

McGregor's Theory X & Y: According to Douglas McGregor's Concept X, the majority of supervisors believe that juniors are passive as well as careless, have little ambition and also withstand change. The tough version of this theory highlighted coercion, tight controls, risks and penalties. Over time it creates low productivity, refined sabotage and rivalry (Deal, 2003). Although the scenario at Cleveland Cliffs Inc is not totally complying with Concept X, it can be seen that new hires are locating this atmosphere instead difficult which might eventually lead to a higher disposition of the monitoring in the direction of Theory X. As per McGregor's promoted view, which he called Concept Y, the vital job of the monitoring is to set up organizational conditions to make sure that individuals can accomplish their very own objectives best by routing their efforts towards organizational rewards. If people locate no contentment in their work, the monitoring would certainly have little selection however to rely upon theory X as well as external control (Offer, 2003). Even while examining Lewis's monitoring style, concept X might have appropriated in the operations division to some extent yet the Advertising and marketing division would require reliance on Theory Y so as to get the creativity and also creativity from the teams.

Tuckman's Team effort Theory: As far as Lewis's concern about bringing harmony in between the marketing and advertising department is concerned, this would initially result in clash as reviewed by Bruce Tuckman in his 'Team effort Concept'. (Tuckman, 1965). Based on Tuckman's concept received appendix 3, during the first phase of group growth, people may not bond, as they are busy discovering their location in the group. By integrating the marketing and advertising division's job, there might be the same first detach which could bring about the 2nd phase of 'storming' where the groups test one another. However, it is only throughout the 3rd stage or 'norming' when they would certainly come together to share ideas prior to the group can produce synergy in the fourth stage 'doing'.

Bridges' Transition Design: As per William Bridge's concept (appendix 4), people are rather uneasy with adjustment, which is noticeable by the scenario at Cleveland Cliffs Inc The scenario can be viewed as a typical program of life if is examined as per Bridge's concept where he clarifies that people experience 3 stages of shift when they experience modification. 'Closing, shedding and also Releasing', The Neutral Area and also 'The New Beginning' (Bridges, 2004). When individuals are presented with change, they go into phase one therefore there may be emotions like unhappiness, unpredictability, disappointment, temper, fear, rejection as well as disorientation.The scenario at the advertising and marketing department of Cleveland Cliffs Inc is similar so Lewis can obtain comfy with the suggestion that it is not phenomenal habits. In the 2nd phase, there may be a requirement to connect the space in between the brand-new and old culture so Lewis might have to face this challenge once Krasnow leaves. There may be low spirits and reduced productivity at this stage which need to not be taken as a problem. It is throughout this stage that Lewis will certainly have to offer assistance to the division so that they can find a sense of direction. It can be seen just how Krasnow has already made this change simpler by making Lewis obtain involved in the division a year prior to his real separation. As per Bridges' Design, phase three will certainly produce openness to understanding, High power as well as commitment as people will certainly accept the adjustment (Bridges, 2004).

Maslow's Demand pecking order: The OB problem related to insecurity at the office has actually been triggered firstly by the change in administration and second of all by the reality that the merging will certainly no more be launched. Abraham Maslow in his Concept of 'Needs Pecking order' (appendix 5) has goes over the importance of 'security needs as being a lower degree need of a human for triggering inspiration. As seen in the pyramid shared in appendix 3, we can see just how 'the demand to really feel secure and also safe' goes to the second degree of requirements. Prior to a worker can be made to establish mentally, he requires to have his 'Physical 'and also 'Security' requires met. This indicates that unless the employees are made to really feel secure regarding their existing work standing in Cleveland Cliffs Inc they might not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Cleveland Cliffs Inc Case Study

Effects of Analysis.

The OB analysis has actually considered numerous concepts to recognize exactly how to manage the present circumstance handy. The adhering to 3 options have actually been recommended to aid Lewis deal with the organizational obstacles in the advertising department. Each of these options has been recommended for reducing the change needed to bring the advertising and marketing division in accordance with the demands of the market and for making the cultural change that would certainly adhere to once the existing leader leaves.

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

Assessment of Alternatives.

Judith Shapiro that has earlier been interviewed by Lewis during the earlier merging days has competence in business-to-business advertising and marketing along with agency as well as retail advertising experience. As soon as Krasnow leaves, Lewis can hire Shapiro as an EVP for marketing to take care of both marketing and also marketing features.

The advantage of this strategy is that it will certainly integrate both functions while lowering the requirement for working with an extra source for advertising. Lewis would certainly be heading the marketing department and also in any case her substitute would certainly be needed for the existing role that she is executing. The disadvantage of this choice is that exterior hiring may bring about animosity from interior personnel who might be considering the setting of EVP after Lewis takes control of Krasnow's placement.

Dividing Adverting and also Manufacturing: Provided the competitive stress as well as high quality work needed from the marketing company, it is recommended that Lewis must enable the manufacturing unit to be a separate feature from the marketing device. Considering that the majority of advertising firms had these two functions as different systems, it makes even more sense to follow the norm.

Combination of Advertising And Marketing with Procedures: Considering that Lewis is already taking care of the advertising and marketing as well as procedures divisions simultaneously; it makes good sense to incorporate both features because she has actually been successfully looking after both ends. The truth that both divisions already have major differences over allowance of resources suggests that this assimilation may be able to cause consistency particularly as Lewis would certainly be heading both ends.However there are numerous disadvantages of this move specifically as it would certainly put way too much worry over Lewis's shoulders. The fact that Lewis needs to adapt her management style for the marketing division recommends that these 2 departments would be culturally diverse. In addition to this, Lewis may not have the ability to use one sort of leadership design to both divisions which might cause inadequacy in either among both features.


An evaluation of the 3 alternatives indicates that assimilation of advertising and marketing and also procedures would certainly not be a feasible action because of the huge differences in between the two departments although that currently Lewis is managing both. While splitting up of the manufacturing function may have been a positive move for the advertising and marketing division, the truth that it would indicate positioning a third function under Lewis's wing suggests this ought to be avoided. The integration of the marketing division is the very best choice in terms of getting the optimum arise from the division. An activity prepare for this option is gone over below.

Activity Strategy.

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

Advertising and Marketing functions would be combined.

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

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

Lewis will certainly separate herself from procedures.

An autonomous leadership style with staff member empowerment will be used in advertising division.

Open up door plan as well as focus on cross department interaction will be focused on eliminating discord.

Backup plan.

If the integration does not exercise as planned, a backup plan would follow which would divide the production function from the marketing feature to reduce the lots on the SVP of marketing and advertising. In case Judith Shapiro does not obtain employed, Lewis will certainly be heading the marketing department without an SVP. In that case the manufacturing function will certainly be separated by positioning it under an SVP manufacturing.