Fremont Financial Corp Case Study Analysis


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Fremont Financial Corp Case Study Analysis

Background and Facts

Fremont Financial Corp an office supplies merchant for tiny and moderate sized services has just recently been involved in planning for a merging with its rival Home Deport, which has affected performance levels in departmentswith the senior manager associated with legal issues put forth by the federal Trade Payment. With the Advertising Head advancing the information of his departure from the firm in one year, Jeannie Lewis, the current head of procedures has actually been asked to take the duty in the future. With challenges in the type of a potential cultural adjustment and low worker spirits, the company requires a full reengineering initiative at the marketing division.

Trouble Declaration
Porter's 5 Forces Analysis
The prospective social adjustment at the marketing division of Fremont Financial Corp is enhancing uncertainty in the working environment bring about numerous obstacles for the Jeannie Lewis who would certainly be replacing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in influencing strategic choices because Stapes Inc. had to abandon its plans of combining with Office Deport after the Federal Profession Compensation's intervention at the same time. Given the fact that the shop has a worldwide visibility with branches in UK, UNITED STATES, Canada as well as Germany, political factors in each of these nations may have the ability to affect efficiency or calculated objectives. Federal Profession Payment's antitrust suit against the merger used up beneficial time of the company's elderly management recommending that 'political' factors can have severe implications for an international business.

Economic Factors: Economic factors such as the introduction of local business in the global scenario suggest that Fremont Financial Corp is growing in a setting where there is possible growth of companies. Truth that store clients are mostly looking for office materials for home workplaces recommends that the market has an increasing trend of business owners and house based services.

Social factors: Social patterns in the economic climate reveal that clients are trying to find comfort as well as attractive rates. Market research demonstrates how the consumer for Fremont Financial Corp lacks awareness about finding services which can provide a combination of convenience and also low costs.

Technical factors: Modern technology plays an essential role in Fremont Financial Corp's organisation approach particularly as the organization is piloting Innovation centers which would provide modern technology sales as well as assistance in the type of memory upgrades, outer setups. (Recap of PARASITE in appendix 2).

OB Issues as well as Symptoms.

Numerous underlying Organizational Habits problems can be seen in Fremont Financial Corp's case as highlighted in this area.

Uneasiness concerning cultural change: There is worry about a cultural adjustment that would happen as soon as Todd Krasnow leaves from his placement as the Exec Vice President of Advertising with a lot of the staff members already showing discontent over this potential action. This expected adjustment has actually produced stress in the office which has been paired with the past tension of preparing the firm for a possible merger with House Deport.
Pest Analysis
Demanding Work Setting for Newcomers: There is lack of workers that can match the stressful environment of a fast-paced company. Not just does this bring about problem in finding the ideal individuals, it puts stress and anxiety on new hires as can not stand up to the rate as well as pressure that the company expects them to bear.

Dual Coverage Lines: Novices locate this business society difficult and also hard to manage particularly as dotted line connections are suggested to be weak generally and also objective setting and also performance examination is still done by the solid line manager. This indicates that novices might shed quality regarding their corresponding duties as well as objectives specifically as dotted line reporting does not keep them in direct interaction with the strong line supervisors.

Resentment From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor as opposed to Bridget Coles although it had actually been speculated that the latter would certainly take Krasnow's placement came as a blow to her spirits. Lewis may have been qualified and proper for the work however the fact that Kransnow's separation would make Coles a direct report to Lewis may have been the reason for Coles' resignation from services.

Concern & Work Instability: Worry as well as instability can be identified as two significant concerns that Lewis would be dealing with especially as the merging has now be cancelled and also two senior executives of the marketing division would be leaving. The entire duty of the department would certainly be falling on Lewis's shoulders that would certainly not simply supervise of brining about a social modification but would also need to confirm herself in her brand-new role.

Incompatible Administration Style of Leader: Lewis's management design as well as its incompatibility with the marketing division's duty can also be seen as an OB challenge particularly as she has actually been made use of to taking care of issues in the operations department where employees are instructed to concentrate on processes and obtain them. The advertising division on the other hand can be viewed as a team of people who are used to being nurtured by Krasnow that concentrated more on result than procedures.

Interdepartmental Disputes: Interdepartmental arguments between three departments, marketing, merchandizing as well as procedures respectively over the allowance of the marketing mix can be recognized as another OB worry. Although the advertising department does not share the very same vision as the other 2 divisions regarding the aloocation of the advertising and marketing mix twoards promotions as well as advertsing, the merchandizing and also operations departments do not concur over the marketing mix allowance among one another either.

Disintegration in Advertising Department: Disintegration in between the marketing and advertising divisions can be identified as another OB problem which can need additional interest. The fact that the advertising and marketing areas in the advertising division are detached is avoiding both departments from acquiring from each other's experience and proficiency. Combination of advertising and marketing with retailing and also operations would become more difficult if the marketing department itself is disintegrated which can be an additional prospective OB worry.

Fremont Financial Corp Analysis

Various concepts have actually been used to discuss the situations to obtain more clearness concerning the circumstance available.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, many managers believe that subordinates are easy and careless, have little ambition and also resist modification. The hard version of this theory highlighted threat, tight controls, hazards and also punishments. With time it creates low productivity, subtle sabotage as well as rivalry (Deal, 2003). Although the circumstance at Fremont Financial Corp is not totally complying with Concept X, it can be seen that brand-new hires are discovering this environment instead difficult which may eventually lead to a greater disposition of the monitoring in the direction of Concept X. Based on McGregor's advocated view, which he called Concept Y, the vital task of the management is to arrange organizational conditions so that people can achieve their own objectives best by guiding their initiatives in the direction of organizational benefits. If individuals locate no contentment in their job, the monitoring would certainly have little selection but to depend on theory X and external control (Deal, 2003). Also while analyzing Lewis's monitoring style, theory X might have been suitable in the procedures division somewhat however the Marketing department would certainly need dependence on Concept Y so as to get the creativity and also originality from the groups.

Tuckman's Teamwork Theory: As far as Lewis's problem regarding bringing harmony between the marketing and advertising division is worried, this would initially result in clash as gone over by Bruce Tuckman in his 'Synergy Concept'. (Tuckman, 1965). As per Tuckman's theory received appendix 3, throughout the initial stage of group development, people might not bond, as they are hectic finding their location in the group. By incorporating the marketing and advertising department's job, there might coincide first disconnect which might lead to the second phase of 'storming' where the teams challenge each other. It is only during the 3rd phase or 'norming' when they would come together to share concepts prior to the group can bring about harmony in the 4th phase 'doing'.

Bridges' Shift Model: According To William Bridge's concept (appendix 4), individuals are rather unpleasant with modification, which is obvious by the scenario at Fremont Financial Corp The situation can be viewed as a typical course of life if is examined as per Bridge's theory where he describes that people go through three stages of shift when they experience modification. 'Closing, shedding and also Letting go', The Neutral Zone as well as 'The New Starting' (Bridges, 2004). When people are presented with change, they get in phase one and so there may be emotions like sadness, uncertainty, frustration, temper, worry, rejection and disorientation.The scenario at the marketing department of Fremont Financial Corp is comparable so Lewis can obtain comfy with the suggestion that it is not amazing behavior. In the 2nd stage, there may be a demand to connect the gap between the new as well as old culture so Lewis may have to encounter this ordeal as soon as Krasnow leaves. There might be low morale and low productivity at this phase which ought to not be taken as a trouble. It is during this phase that Lewis will certainly have to provide guidance to the department to ensure that they can discover an orientation. It can be seen just how Krasnow has currently made this shift much easier by making Lewis obtain involved in the department a year prior to his real departure. According to Bridges' Design, stage three will certainly cause visibility to learning, High power as well as commitment as individuals will certainly embrace the modification (Bridges, 2004).
Vrio Analysis
Maslow's Requirement hierarchy: The OB problem pertaining to instability at the office has actually been caused to start with by the modification in management and also second of all by the fact that the merging will certainly no longer be started. Abraham Maslow in his Theory of 'Demands Power structure' (appendix 5) has reviews the significance of 'safety and security needs as being a reduced level need of a human for causing motivation. As seen in the pyramid cooperated appendix 3, we can see just how 'the need to really feel protected as well as untouched' is at the 2nd level of needs. Prior to a worker can be made to create emotionally, he requires to have his 'Physical 'and also 'Safety and security' requires satisfied. This suggests that unless the workers are made to feel safe about their present employment status in Fremont Financial Corp they may not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Fremont Financial Corp Case Study

Implication of Analysis.

The OB analysis has checked out different concepts to understand how to handle the existing scenario at hand. The following 3 options have actually been proposed to assist Lewis deal with the business challenges in the advertising department. Each of these alternatives has actually been recommended for relieving the change needed to bring the marketing department in accordance with the requirements of the marketplace and also for making the cultural change that would adhere to when the present leader leaves.

Combination of marketing and advertising functions. Dividing Adverting and Production functions. Assimilation of Advertising with Operations.

Evaluation of Alternatives.

Combination of Marketing & Marketing Functions: The in-house advertising firm of Fremont Financial Corp is currently toughness for the company in regards to conserving up on overheads connected to advertising and promotion. Given that no brand-new recruitment has been done after Bridget Cole's departure with the coverage line being straight designated to Krasnow for the advertising function, this is a positive opportunity for incorporating the marketing and advertising functions. Judith Shapiro that has earlier been talked to by Lewis throughout the earlier merger days has know-how in business-to-business advertising and marketing together with firm as well as retail advertising experience. Once Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to deal with both marketing and advertising features.

The benefit of this method is that it will integrate both features while lowering the requirement for employing an additional source for marketing. In addition to this, Lewis would certainly be heading the advertising and marketing department and also regardless her replacement would certainly be required for the current duty that she is executing. The downside of this alternative is that external hiring may bring about bitterness from inner employees that may be looking at the placement of EVP after Lewis takes over Krasnow's placement.

Separating Adverting and Production: Given the affordable pressures and high top quality work called for from the advertising agency, it is recommended that Lewis should allow the production unit to be a different feature from the advertising and marketing system. Because many advertising companies had these 2 functions as different units, it makes even more sense to comply with the norm.

Assimilation of Advertising And Marketing with Operations: Because Lewis is already taking care of the advertising and procedures divisions concurrently; it makes sense to integrate both functions because she has been successfully looking after both ends. The fact that the two divisions already have major differences over appropriation of sources recommends that this combination may be able to bring about harmony especially as Lewis would certainly be heading both ends.However there are numerous negative aspects of this move particularly as it would certainly place too much concern over Lewis's shoulders. The truth that Lewis needs to adjust her management design for the advertising and marketing department suggests that these 2 departments would certainly be culturally diverse. Along with this, Lewis might not have the ability to apply one sort of management style to both departments which might lead to ineffectiveness in either one of the two features.


An assessment of the 3 options suggests that integration of advertising and marketing as well as operations would certainly not be a feasible move due to the substantial differences between the two divisions regardless of the truth that presently Lewis is handling both. While separation of the production feature may have been a favorable move for the advertising division, the reality that it would suggest putting a 3rd function under Lewis's wing suggests this ought to be avoided.

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

Marketing and advertising functions would be combined.

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

Production feature will certainly continue to be component of marketing under advertising feature.

Lewis will separate herself from operations.

A democratic leadership design with staff member empowerment will certainly be utilized in advertising division.

Open door plan and focus on cross departmental communication will be aimed at eliminating dissonance.

Backup strategy.

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