Gulf Oil Corp Takeover Case Study Solution


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Gulf Oil Corp Takeover Case Study Analysis

Background and Facts

Gulf Oil Corp Takeover an office supplies merchant for little as well as medium sized businesses has actually just recently been associated with preparing for a merger with its competitor Residence Deport, which has influenced effectiveness levels in departmentswith the elderly supervisor associated with lawful difficulties presented by the federal Profession Commission. With the Marketing Head putting forward the news of his departure from the company in one year, Jeannie Lewis, the current head of operations has been asked to take the duty in the future. With obstacles in the form of a prospective cultural adjustment and low employee spirits, the company requires a full reengineering initiative at the advertising division.

Problem Declaration

The possible cultural change at the advertising division of Gulf Oil Corp Takeover is raising uncertainty in the workplace causing different 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 significant function in affecting strategic decisions given that Stapes Inc. needed to desert its plans of combining with Office Deport after the Federal Trade Compensation's intervention at the same time. Offered the truth that the store has a worldwide existence with branches in UK, UNITED STATES, Canada as well as Germany, political factors in each of these countries may be able to affect efficiency or strategic goals. Federal Profession Payment's antitrust suit versus the merger occupied beneficial time of the company's senior monitoring recommending that 'political' factors can have severe effects for a worldwide business.

Economic Factors: Economic factors such as the emergence of small companies in the international circumstance suggest that Gulf Oil Corp Takeover is prospering in a setting where there is possible growth of services. Reality that store consumers are mostly looking for workplace products for residence workplaces suggests that the market has a climbing fad of business owners and house based businesses.

Social factors: Social fads in the economic situation reveal that customers are searching for convenience along with eye-catching prices. Marketing research shows how the consumer for Gulf Oil Corp Takeover lacks recognition concerning finding remedies which can use a mix of convenience and low costs.

Technical factors: Modern technology plays a crucial function in Gulf Oil Corp Takeover's organisation method particularly as the company is piloting Modern technology centers which would certainly supply modern technology sales and assistance in the type of memory upgrades, outer setups. (Summary of PARASITE in appendix 2).

OB Issues and Effects.

A number of underlying Business Habits problems can be seen in Gulf Oil Corp Takeover's case as highlighted in this section.

Uneasiness concerning cultural change: There is apprehension concerning a social modification that would happen once Todd Krasnow leaves from his position as the Executive Vice President of Advertising And Marketing with most of the staff members already revealing unhappiness over this possible step. This anticipated adjustment has actually created stress and anxiety in the workplace which has been coupled with the past tension of preparing the firm for a potential merging with Residence Deport.

Demanding Job Setting for Newcomers: There is lack of personnel that can match the demanding environment of a busy organization. Not only does this result in trouble in finding the appropriate individuals, it puts stress and anxiety on brand-new hires as can not withstand the rate and also pressure that the organization expects them to birth.

Twin Reporting Lines: Newbies locate this organizational culture cumbersome and difficult to deal with particularly as populated line relationships are implied to be weak in general and objective setup and efficiency evaluation is still done by the solid line manager. This suggests that beginners can shed clarity about their respective functions and also objectives especially as dotted line reporting does not keep them in straight communication with the solid line supervisors.

Resentment From Cross Departmental Hiring: Krasnow's decision to make Lewis his follower rather than Bridget Coles despite the fact that it had been speculated that the last would take Krasnow's placement came as a strike to her morale. Lewis may have been capable as well as proper for the task but the fact that Kransnow's departure would make Coles a direct report to Lewis may have been the factor for Coles' resignation from services.

Fear & Job Insecurity: Fear as well as instability can be determined as two major worries that Lewis would be dealing with particularly as the merging has actually currently be terminated and two senior executives of the advertising department would certainly be leaving. The entire obligation of the department would certainly be falling on Lewis's shoulders that would certainly not just be in charge of brining regarding a cultural modification however would certainly likewise need to show herself in her new role.

Incompatible Monitoring Style of Leader: Lewis's administration style and its incompatibility with the advertising and marketing department's duty can likewise be seen as an OB obstacle particularly as she has been made use of to managing problems in the operations division where employees are taught to concentrate on procedures and also get them right. The advertising and marketing department on the various other hand can be seen as a team of people that are made use of to being nurtured by Krasnow who focused a lot more on output than procedures.

Interdepartmental Disputes: Interdepartmental disagreements between three departments, marketing, merchandizing and operations specifically over the allowance of the advertising and marketing mix can be determined as an additional OB worry. The advertising and marketing department does not share the exact same vision as the various other 2 departments regarding the aloocation of the advertising and marketing mix twoards promotions as well as advertsing, the merchandizing and procedures divisions do not agree over the marketing mix allocation amongst one another either.

Disintegration in Marketing Department: Fragmentation in between the marketing and advertising divisions can be identified as another OB problem which might require additional focus. The reality that the marketing and advertising sections in the advertising department are separated is protecting against both divisions from gaining from each other's experience as well as knowledge. Combination of advertising with retailing as well as operations would become more difficult if the marketing department itself is degenerated which can be an additional prospective OB worry.

Gulf Oil Corp Takeover Analysis

Various theories have been utilized to describe the circumstances to get more clarity regarding the situation handy.

McGregor's Theory X & Y: According to Douglas McGregor's Concept X, the majority of managers think that subordinates are easy and also careless, have little aspiration and resist adjustment. The tough variation of this theory stressed coercion, tight controls, risks as well as punishments. Gradually it produces low productivity, subtle sabotage and rivalry (Deal, 2003). Although the scenario at Gulf Oil Corp Takeover is not entirely adhering to Theory X, it can be seen that brand-new hires are locating this environment rather demanding which might ultimately result in a greater inclination of the monitoring in the direction of Concept X. Based on McGregor's advocated sight, which he called Theory Y, the crucial job of the monitoring is to set up business problems so that individuals can attain their very own goals best by directing their initiatives in the direction of business rewards. If individuals find no contentment in their job, the administration would certainly have little option however to rely on theory X as well as exterior control (Offer, 2003). Even while assessing Lewis's monitoring style, concept X may have been suitable in the procedures department somewhat however the Marketing department would need dependence on Concept Y so as to get the creativity as well as originality from the teams.

Tuckman's Team effort Concept: As much as Lewis's worry regarding bringing consistency in between the marketing and also advertising and marketing division is worried, this would initially lead to contrast as discussed by Bruce Tuckman in his 'Teamwork Theory'. By incorporating the advertising and advertising department's work, there might be the very same first disconnect which might lead to the second phase of 'storming' where the teams test one an additional.

When people are offered with adjustment, they enter stage one as well as so there might be feelings like sadness, unpredictability, stress, anger, worry, denial as well as disorientation.The scenario at the advertising and marketing division of Gulf Oil Corp Takeover is similar so Lewis can obtain comfortable with the suggestion that it is not remarkable actions. It is during this phase that Lewis will have to offer advice to the department so that they can locate a feeling of direction. It can be seen exactly how Krasnow has currently made this shift much easier by making Lewis obtain involved in the division a year prior to his real departure.

Maslow's Requirement pecking order: The OB issue related to insecurity at the workplace has been activated firstly by the modification in administration as well as second of all by the reality that the merging will no more be started. Abraham Maslow in his Theory of 'Needs Power structure' (appendix 5) has talks about the value of 'safety and security requires as being a reduced degree need of a human for causing inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the demand to really feel safe and secure as well as unharmed' goes to the 2nd level of demands. Before a worker can be made to establish mentally, he needs to have his 'Physiological 'and also 'Security' needs met. This shows that unless the workers are made to feel safe regarding their current work status in Gulf Oil Corp Takeover they may not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Gulf Oil Corp Takeover Case Study

Implication of Analysis.

The OB analysis has considered various concepts to comprehend how to handle the current circumstance available. The complying with three choices have been suggested to help Lewis manage the business difficulties in the advertising department. Each of these options has been suggested for easing the transition required to bring the advertising and marketing department according to the requirements of the market as well as for making the cultural modification that would follow as soon as the present leader leaves.

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

Analysis of Alternatives.

Judith Shapiro who has earlier been talked to by Lewis during the earlier merger days has experience in business-to-business advertising and marketing along with firm as well as retail marketing experience. Once Krasnow leaves, Lewis can hire Shapiro as an EVP for marketing to manage both advertising and marketing and marketing functions.

The advantage of this approach is that it will incorporate both features while minimizing the demand for employing an added source for advertising and marketing. Lewis would certainly be heading the advertising division and also in any type of case her substitute would be needed for the existing duty that she is carrying out. The negative aspect of this option is that outside hiring might bring about animosity from interior employees who might be eying the setting of EVP after Lewis takes over Krasnow's position.

Dividing Adverting and Manufacturing: Provided the competitive pressures and also top quality work needed from the ad agency, it is suggested that Lewis needs to allow the production unit to be a separate feature from the advertising device. Given that many ad agency had these 2 functions as separate systems, it makes more sense to comply with the standard. Both features might be able to focus on their core activates more effectively. The drawback of this approach would certainly be that extra costs would have to be borne for establishing up separate production features. A production head might have to be hired which can enhance overheads for the company.

Integration of Advertising And Marketing with Operations: Given that Lewis is already looking after the advertising and operations departments all at once; it makes good sense to incorporate the two functions because she has been efficiently caring for both ends. The truth that both departments currently have major differences over allocation of resources suggests that this combination may be able to bring about harmony especially as Lewis would be heading both ends.However there are numerous negative aspects of this relocation particularly as it would put excessive concern over Lewis's shoulders. The truth that Lewis has to adapt her monitoring style for the advertising and marketing department suggests that these 2 divisions would be culturally varied. Lewis might not be able to use one kind of management design to both departments which might result in inadequacy in either one of the two functions.


An evaluation of the 3 alternatives suggests that assimilation of advertising and marketing and also operations would not be a viable action due to the huge distinctions in between the two divisions in spite of the fact that presently Lewis is taking care of both. While splitting up of the manufacturing feature might have been a desirable move for the advertising and marketing department, the fact that it would certainly mean positioning a 3rd function under Lewis's wing indicates this must be prevented.

Action Strategy.

Lewis will certainly take over the function of EVP Marketing after Krasnow leaves.

Marketing and advertising features would certainly be merged.

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

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

Lewis will certainly separate herself from procedures.

A democratic management design with worker empowerment will be made use of in advertising and marketing department.

Open door plan and also focus on cross departmental communication will certainly be focused on eliminating disharmony.

Backup plan.

If the integration does not exercise as intended, a contingency strategy would adhere to which would divide the production function from the marketing function to lower the load 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. Because case the production feature will absolutely be separated by placing it under an SVP manufacturing.