Menu

Formosa Plastics Group Business Continuity Forever Case Study Analysis

CASE SOLUTION

Home >> Harvard >> Formosa Plastics Group Business Continuity Forever >>

Formosa Plastics Group Business Continuity Forever Case Study Help

Background and Facts

Formosa Plastics Group Business Continuity Forever a workplace products merchant for tiny and medium sized organisations has actually recently been associated with planning for a merger with its rival House Deport, which has actually impacted performance levels in departmentswith the senior manager involved in legal difficulties put forth by the federal Profession Commission. With the Advertising Head advancing the news of his departure from the company in one year, Jeannie Lewis, the current head of operations has actually been asked to take the duty in the near future. With difficulties in the form of a possible social modification and low staff member morale, the company requires a complete reengineering effort at the advertising and marketing department.

Problem Declaration
Porter's 5 Forces Analysis
The potential social change at the advertising and marketing division of Formosa Plastics Group Business Continuity Forever is boosting uncertainty in the working environment leading to different difficulties for the Jeannie Lewis who would certainly be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in affecting calculated decisions given that Stapes Inc. had to abandon its strategies of combining with Workplace Deport after the Federal Trade Payment's treatment while doing so. Provided the fact that the shop has a global visibility with branches in UK, UNITED STATES, Canada and Germany, political consider each of these nations may be able to influence performance or strategic objectives. Federal Trade Commission's antitrust suit versus the merger used up important time of the organization's senior administration suggesting that 'political' factors can have serious effects for a global company.

Economic Factors: Financial factors such as the introduction of small companies in the international situation recommend that Formosa Plastics Group Business Continuity Forever is flourishing in a setting where there is potential growth of businesses. Truth that store customers are primarily looking for workplace products for residence offices suggests that the market has a rising trend of entrepreneurs as well as home based companies.

Social factors: Social trends in the economic climate show that consumers are seeking ease along with attractive rates. Market research demonstrates how the consumer for Formosa Plastics Group Business Continuity Forever lacks awareness concerning finding services which can use a mix of comfort as well as inexpensive.

Technological factors: Innovation plays a crucial function in Formosa Plastics Group Business Continuity Forever's service method particularly as the company is piloting Technology facilities which would supply modern technology sales and also assistance in the form of memory upgrades, peripheral installments. (Summary of INSECT in appendix 2).

OB Issues and also Symptoms.

A number of underlying Organizational Behavior issues can be seen in Formosa Plastics Group Business Continuity Forever's case as highlighted in this section.

Worries regarding social adjustment: There is uneasiness regarding a cultural adjustment that would take place as soon as Todd Krasnow leaves from his placement as the Exec Vice Head Of State of Advertising And Marketing with most of the team member currently revealing discontent over this possible step. This expected adjustment has actually created anxiety in the work environment which has been paired with the past tension of preparing the company for a possible merging with Home Deport.
Pest Analysis
Difficult Job Setting for Newcomers: There is lack of employees that can match the stressful environment of a hectic organization. Not only does this cause problem in discovering the right individuals, it puts stress on new hires as can not hold up against the rate and also stress that the company expects them to bear.

Double Reporting Lines: Newcomers find this organizational culture troublesome as well as hard to cope with particularly as populated line relationships are implied to be weaker generally as well as unbiased setting and performance assessment is still done by the strong line supervisor. This implies that beginners could shed clarity regarding their respective roles as well as goals especially as dotted line reporting does not maintain them in direct interaction with the solid line managers.

Bitterness From Cross Departmental Hiring: Krasnow's choice to make Lewis his follower instead of Bridget Coles despite the fact that it had actually been speculated that the last would certainly take Krasnow's setting came as a blow to her morale. Lewis might have been capable and also ideal for the job but the fact that Kransnow's separation would certainly make Coles a direct report to Lewis might have been the factor for Coles' resignation from solutions.

Fear & Task Insecurity: Fear and also insecurity can be determined as 2 major concerns that Lewis would be taking care of especially as the merger has now be terminated as well as two elderly execs of the advertising and marketing division would certainly be leaving. The entire responsibility of the division would be dropping on Lewis's shoulders who would not simply be in charge of brining about a social adjustment yet would likewise have to prove herself in her new role.

Incompatible Management Style of Leader: Lewis's monitoring design and also its incompatibility with the advertising division's role can likewise be viewed as an OB challenge especially as she has been made use of to dealing with concerns in the procedures division where workers are educated to concentrate on processes as well as get them right. The marketing division on the various other hand can be seen as a team of people who are used to being nurtured by Krasnow who concentrated much more on outcome than procedures.

Interdepartmental Disputes: Interdepartmental differences in between 3 divisions, advertising and marketing, merchandizing and procedures specifically over the allotment of the advertising and marketing mix can be identified as an additional OB problem. Although the advertising and marketing division does not share the same vision as the various other two departments regarding the aloocation of the advertising and marketing mix twoards promos and advertsing, the merchandizing as well as procedures divisions do not concur over the marketing mix allowance among one another either.

Fragmentation in Advertising Division: Fragmentation in between the marketing and advertising divisions can be determined as one more OB concern which can need additional focus. The reality that the advertising and marketing sections in the marketing department are separated is avoiding both departments from obtaining from each various other's experience as well as know-how. Integration of advertising with merchandising as well as procedures would certainly become harder if the advertising division itself is broken down which can be one more possible OB concern.

Formosa Plastics Group Business Continuity Forever Analysis

Different theories have actually been made use of to explain the conditions to obtain more clarity concerning the circumstance at hand.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, a lot of supervisors believe that subordinates are easy and also lazy, have little aspiration and withstand modification. The hard variation of this theory highlighted threat, limited controls, risks and penalties. Gradually it produces reduced performance, refined sabotage and also rivalry (Deal, 2003). The scenario at Formosa Plastics Group Business Continuity Forever is not completely adhering to Concept X, it can be seen that brand-new hires are discovering this environment rather demanding which may at some point lead to a better inclination of the monitoring in the direction of Concept X. Based on McGregor's promoted view, which he called Concept Y, the necessary job of the administration is to set up organizational conditions so that people can attain their own objectives best by routing their efforts in the direction of business rewards. If individuals discover no fulfillment in their job, the monitoring would certainly have little option yet to rely on theory X as well as external control (Deal, 2003). Even while analyzing Lewis's monitoring style, theory X may have been suitable in the procedures division to some extent but the Advertising and marketing division would require reliance on Concept Y in order to get the creativity and originality from the teams.

Tuckman's Synergy Concept: Regarding Lewis's issue regarding bringing consistency between the marketing and advertising department is worried, this would initially result in conflict as gone over by Bruce Tuckman in his 'Team effort Theory'. (Tuckman, 1965). As per Tuckman's theory displayed in appendix 3, during the first phase of team development, people may not bond, as they are active finding their place in the team. By incorporating the advertising and marketing department's work, there might coincide initial disconnect which might result in the second stage of 'storming' where the teams test each other. It is only throughout the 3rd phase or 'norming' when they would come with each other to share concepts before the team can bring about harmony in the fourth stage 'doing'.

Bridges' Shift Model: Based On William Bridge's theory (appendix 4), people are quite uncomfortable with change, which is evident by the scenario at Formosa Plastics Group Business Continuity Forever The circumstance can be seen as a normal training course of life if is researched according to Bridge's theory where he describes that individuals experience three stages of change when they experience modification. 'Closing, losing as well as Letting go', The Neutral Zone as well as 'The New Beginning' (Bridges, 2004). When people exist with change, they get in phase one therefore there may be emotions like sadness, uncertainty, irritation, rage, anxiety, denial as well as disorientation.The situation at the advertising and marketing department of Formosa Plastics Group Business Continuity Forever is comparable so Lewis can get comfy with the idea that it is not extraordinary behavior. In the second stage, there may be a need to connect the space in between the brand-new and old culture so Lewis may need to face this ordeal once Krasnow leaves. There may be reduced morale as well as low productivity at this phase which should not be taken as an obstacle. It is throughout this phase that Lewis will have to give guidance to the department to make sure that they can locate a sense of direction. It can be seen exactly how Krasnow has actually currently made this transition much easier by making Lewis obtain associated with the department a year prior to his actual separation. Based on Bridges' Design, phase 3 will cause visibility to discovering, High power as well as dedication as people will embrace the modification (Bridges, 2004).
Vrio Analysis
Maslow's Demand pecking order: The OB concern related to insecurity at the office has actually been set off first of all by the change in administration as well as secondly by the fact that the merger will no more be launched. Abraham Maslow in his Concept of 'Needs Pecking order' (appendix 5) has goes over the value of 'protection needs as being a reduced level requirement of a human for setting off motivation. As seen in the pyramid shared in appendix 3, we can see just how 'the need to feel safe and also safe' goes to the second degree of requirements. Before a staff member can be made to develop psychologically, he requires to have his 'Physiological 'and also 'Safety' needs fulfilled. This suggests that unless the personnel are made to feel secure regarding their current employment condition in Formosa Plastics Group Business Continuity Forever they may not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Formosa Plastics Group Business Continuity Forever Case Study



Implication of Analysis.

The OB analysis has looked at various theories to comprehend just how to manage the present scenario at hand. The following 3 options have been proposed to assist Lewis manage the business challenges in the marketing division. Each of these choices has actually been proposed for alleviating the shift required to bring the advertising division in line with the needs of the marketplace as well as for making the social change that would adhere to when the present leader leaves.

Assimilation of marketing and advertising functions. Dividing Adverting and also Manufacturing functions. Combination of Advertising with Workflow.

Analysis of Alternatives.

Combination of Advertising & Marketing Functions: The internal advertising and marketing agency of Formosa Plastics Group Business Continuity Forever is currently toughness for the organization in terms of saving up on overheads connected to advertising and promotion. Because no new recruitment has been done after Bridget Cole's separation with the reporting line being straight assigned to Krasnow for the marketing feature, this is a beneficial possibility for incorporating the marketing and advertising features. Judith Shapiro that has actually earlier been talked to by Lewis throughout the earlier merger days has know-how in business-to-business marketing in addition to agency as well as retail marketing experience. When Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising and marketing to take care of both advertising and marketing functions.

The advantage of this strategy is that it will certainly integrate the two functions while lowering the need for working with an additional source for marketing. Lewis would be heading the marketing department and also in any kind of case her substitute would be needed for the existing role that she is performing. The drawback of this option is that exterior hiring may cause resentment from inner workers who may be considering the setting of EVP after Lewis takes control of Krasnow's placement.

Separating Adverting and Manufacturing: Provided the competitive stress and premium quality work required from the ad agency, it is suggested that Lewis must permit the manufacturing system to be a separate feature from the advertising device. Given that many ad agency had these 2 features as separate units, it makes more feeling to follow the standard. Both functions might be able to focus on their core triggers more effectively. The negative aspect of this method would certainly be that extra expenses would have to be borne for establishing up different production features. Along with this, a production head might need to be worked with which might raise overheads for the organization.

Combination of Advertising And Marketing with Workflows: Considering that Lewis is already taking treatment of the advertising and marketing and also operations divisions at the same time; it makes sense to incorporate the two functions since she has actually been effectively taking care of both ends. The truth that Lewis has to adapt her administration style for the advertising division suggests that these 2 divisions would be culturally varied.

Recommendation.



An examination of the 3 alternatives indicates that integration of marketing as well as procedures would not be a practical move due to the substantial distinctions between the 2 divisions in spite of the truth that presently Lewis is handling both. While separation of the production function might have been a favorable step for the advertising and marketing division, the fact that it would mean positioning a 3rd function under Lewis's wing means this need to be avoided.

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

Marketing and advertising features would be merged.

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

Manufacturing feature will certainly stay part of advertising and marketing under advertising and marketing feature.

Lewis will certainly separate herself from operations.

A democratic management style with staff member empowerment will be used in marketing division.

Open up door policy as well as emphasis on cross department communication will certainly be aimed at removing discord.

Contingency plan.

If the assimilation does not work out as prepared, a backup strategy would certainly comply with which would divide the production function from the advertising function to decrease the load on the SVP of marketing and advertising. In case Judith Shapiro does not obtain worked with, Lewis will be heading the advertising and marketing division without an SVP. In that case the manufacturing feature will absolutely be separated by putting it under an SVP manufacturing.