Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision Case Study Analysis


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Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision Case Study Solution

Background and Facts

Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision an office materials merchant for tiny as well as medium sized services has actually recently been involved in planning for a merging with its competitor House Deport, which has affected performance levels in departmentswith the senior supervisor involved in legal issues presented by the federal Trade Commission. With the Marketing Head putting forward the information of his departure from the business in one year, Jeannie Lewis, the current head of operations has been asked to take the role in the future. With difficulties in the kind of a prospective cultural change and reduced staff member spirits, the company needs a full reengineering initiative at the marketing division.

Issue Statement
Porter's 5 Forces Analysis
The prospective social adjustment at the marketing division of Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision is boosting unpredictability in the working environment leading to numerous obstacles 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 role in impacting strategic decisions given that Stapes Inc. needed to abandon its plans of combining with Workplace Deport after the Federal Profession Payment's treatment at the same time. Provided the truth that the store has a global presence with branches in UK, UNITED STATES, Canada and Germany, political factors in each of these nations might be able to impact efficiency or critical goals. Federal Trade Compensation's antitrust suit against the merger occupied beneficial time of the organization's senior monitoring suggesting that 'political' factors can have severe implications for a worldwide organisation.

Economic Factors: Financial factors such as the emergence of small businesses in the international situation recommend that Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision is flourishing in an environment where there is potential development of businesses. Along with this, fact that store customers are mainly trying to find office materials for office suggests that the market has an increasing pattern of entrepreneurs and also home organisations.

Social factors: Social fads in the economy show that customers are looking for comfort as well as attractive costs. Market research shows how the consumer for Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision lacks understanding about locating remedies which can provide a mix of comfort as well as low costs.

Technological factors: Modern technology plays a vital function in Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision's business technique specifically as the company is piloting Modern technology facilities which would certainly use modern technology sales and also support in the kind of memory upgrades, outer installments. (Summary of PEST in appendix 2).

OB Issues and also Symptoms.

A number of underlying Organizational Habits concerns can be seen in Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision's case as highlighted in this area.

Concerns about cultural modification: There is concern regarding a cultural change that would happen once Todd Krasnow leaves from his setting as the Exec Vice President of Advertising with most of the personnel currently revealing unhappiness over this possible move. This anticipated change has developed stress and anxiety in the workplace which has actually been paired with the previous stress of preparing the company for a prospective merging with House Deport.
Pest Analysis
Stressful Task Environment for Newcomers: There is scarcity of employees that can match the difficult setting of a hectic organization. Not only does this bring about difficulty in finding the ideal people, it places stress and anxiety on brand-new hires as can not stand up to the pace and also stress that the organization expects them to birth.

Twin Coverage Lines: Novices discover this organizational culture cumbersome as well as challenging to cope with specifically as dotted line relationships are implied to be weaker as a whole as well as objective setting and efficiency analysis is still done by the strong line supervisor. This means that newcomers can lose clearness about their corresponding duties and objectives especially as populated line reporting does not maintain them in direct interaction with the solid line supervisors.

Bitterness From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor as opposed to Bridget Coles even though it had been hypothesized that the last would certainly take Krasnow's placement came as a blow to her spirits. Lewis might have been qualified and also proper for the task yet the reality that Kransnow's separation would certainly make Coles a straight record to Lewis might have been the factor for Coles' resignation from services.

Worry & Work Insecurity: Fear as well as insecurity can be determined as 2 significant worries that Lewis would certainly be taking care of specifically as the merger has currently be terminated and also 2 senior execs of the marketing department would be leaving. The entire obligation of the department would be dropping on Lewis's shoulders that would not simply supervise of brining regarding a social change yet would also have to verify herself in her brand-new duty.

Incompatible Monitoring Style of Leader: Lewis's monitoring style and also its incompatibility with the advertising and marketing division's function can also be seen as an OB difficulty specifically as she has actually been used to managing problems in the operations department where employees are shown to concentrate on processes and get them. The advertising and marketing division on the various other hand can be viewed as a group of people that are utilized to being nurtured by Krasnow that concentrated more on result than procedures.

Interdepartmental Arguments: Interdepartmental disagreements in between 3 departments, advertising and marketing, merchandizing and procedures specifically over the allotment of the advertising mix can be recognized as an additional OB worry. The advertising and marketing division does not share the very same vision as the various other 2 divisions concerning the aloocation of the advertising mix twoards promotions and advertsing, the merchandizing as well as operations divisions do not concur over the advertising mix appropriation among one an additional either.

Disintegration in Marketing Division: Disintegration between the marketing and advertising divisions can be determined as another OB problem which can require further interest. The reality that the marketing and advertising areas in the marketing division are detached is protecting against both divisions from acquiring from each other's experience as well as expertise. Assimilation of advertising with retailing and also procedures would certainly become more difficult if the advertising and marketing division itself is degenerated which can be another prospective OB problem.

Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision Analysis

Different theories have actually been used to explain the situations to get further clarity concerning the scenario handy.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Concept X, a lot of supervisors believe that staffs are passive and careless, have little passion and also resist adjustment. The scenario at Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision is not entirely following Theory X, it can be seen that new hires are discovering this environment instead demanding which might ultimately lead to a higher inclination of the administration in the direction of Concept X. Even while evaluating Lewis's administration style, concept X might have been ideal in the operations division to some level but the Marketing department would require reliance on Theory Y in order to get the creativity and also creativity from the groups.

Tuckman's Synergy Theory: As far as Lewis's issue about bringing harmony in between the advertising and marketing and also advertising department is worried, this would originally lead to clash as discussed by Bruce Tuckman in his 'Teamwork Theory'. By integrating the advertising and marketing and also advertising and marketing division's job, there might be the very same preliminary disconnect which can lead to the second phase of 'storming' where the groups test one another.

Bridges' Change Version: Based On William Bridge's concept (appendix 4), individuals are fairly awkward with modification, which is noticeable by the scenario at Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision The situation can be viewed as a typical training course of life if is researched according to Bridge's theory where he discusses that people go through three phases of shift when they experience change. 'Ending, losing and also Letting go', The Neutral Zone and 'The New Starting' (Bridges, 2004). When people are presented with change, they go into stage one therefore there might be feelings like despair, unpredictability, irritation, anger, anxiety, rejection and also disorientation.The circumstance at the advertising division of Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision is similar so Lewis can obtain comfy with the idea that it is not extraordinary behavior. In the 2nd phase, there might be a demand to bridge the gap between the new and old culture so Lewis might need to encounter this experience once Krasnow leaves. There may be reduced spirits as well as low productivity at this phase which must not be taken as a setback. It is throughout this phase that Lewis will certainly have to give support to the department to ensure that they can find an orientation. It can be seen exactly how Krasnow has actually already made this shift much easier by making Lewis obtain associated with the division a year before his real separation. Based on Bridges' Model, stage three will produce openness to understanding, High energy and dedication as people will embrace the modification (Bridges, 2004).
Vrio Analysis
Abraham Maslow in his Concept of 'Requirements Pecking order' (appendix 5) has talks about the value of 'security requires as being a lower degree need of a human for causing inspiration. As seen in the pyramid shared in appendix 3, we can see how 'the need to really feel protected and also out of risk' is at the 2nd level of needs. Before a staff member can be made to create mentally, he needs to have his 'Physical 'and 'Safety and security' needs fulfilled.

SWOT Analysis for Hong Kong Dragon Airlines Limited B Lease Vs Buy Decision Case Study

Implication of Analysis.

The OB analysis has checked out various concepts to recognize just how to deal with the present situation at hand. The following 3 alternatives have actually been suggested to help Lewis handle the business challenges in the advertising and marketing department. Each of these choices has been suggested for relieving the transition needed to bring the marketing division according to the requirements of the marketplace and for making the cultural modification that would adhere to when the present leader leaves.

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

Assessment of Alternatives.

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

The advantage of this approach is that it will incorporate the two features while decreasing the requirement for hiring an added resource for advertising and marketing. Along with this, Lewis would certainly be heading the advertising and marketing division as well as regardless her replacement would be needed for the existing role that she is executing. The negative aspect of this alternative is that outside hiring may produce resentment from inner workers that might be considering the position of EVP after Lewis takes over Krasnow's position.

Dividing Adverting and Manufacturing: Provided the competitive stress and high top quality work needed from the advertising and marketing firm, it is advised that Lewis ought to enable the manufacturing unit to be a different feature from the marketing device. Given that most advertising firms had these 2 features as different units, it makes even more feeling to follow the norm.

Assimilation of Advertising And Marketing with Operations: Because Lewis is currently taking care of the advertising as well as procedures departments all at once; it makes sense to incorporate the two functions since she has been effectively taking treatment of both ends. The fact that Lewis has to adapt her administration design for the marketing department recommends that these 2 departments would be culturally varied.


An assessment of the three choices shows that integration of advertising and marketing as well as operations would not be a possible move due to the substantial differences in between the 2 divisions despite the reality that presently Lewis is dealing with both. While separation of the manufacturing feature might have been a favorable action for the advertising and marketing department, the truth that it would indicate placing a 3rd feature under Lewis's wing implies this ought to be stayed clear of.

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

Advertising and Marketing features would be merged.

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

Production feature will certainly stay part of advertising and marketing under advertising function.

Lewis will certainly separate herself from procedures.

A democratic leadership design with employee empowerment will be made use of in advertising division.

Open up door policy and focus on cross department interaction will certainly be targeted at eliminating dissonance.

Backup plan.

If the integration does not work out as planned, a backup strategy would certainly comply with which would certainly separate the production function from the advertising and marketing feature 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. In that case the manufacturing function will most definitely be separated by putting it under an SVP manufacturing.