Ivar Kreuger And The Swedish Match Empire Case Study Solution


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Ivar Kreuger And The Swedish Match Empire Case Study Help

Background and Facts

Ivar Kreuger And The Swedish Match Empire a workplace products retailer for little and also medium sized businesses has recently been involved in planning for a merger with its competitor Home Deport, which has actually affected performance levels in departmentswith the senior manager involved in lawful problems presented by the federal Profession Compensation. With the Marketing Head advancing the information of his departure from the business in one year, Jeannie Lewis, the existing head of procedures has actually been asked to take the duty in the near future. With challenges in the type of a prospective cultural adjustment and reduced employee spirits, the company is in need of a complete reengineering effort at the advertising division.

Issue Declaration
Porter's 5 Forces Analysis
The prospective social adjustment at the marketing division of Ivar Kreuger And The Swedish Match Empire is raising unpredictability in the working environment leading to numerous 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 role in affecting critical choices since Stapes Inc. needed to desert its strategies of merging with Workplace Deport after the Federal Profession Commission's treatment while doing so. Offered the reality that the store has a global existence with branches in UK, USA, Canada and Germany, political consider each of these countries may be able to affect performance or calculated goals. Federal Profession Compensation's antitrust fit versus the merging took up beneficial time of the company's elderly monitoring suggesting that 'political' factors can have serious implications for a global service.

Economic Factors: Economic factors such as the emergence of small businesses in the worldwide scenario suggest that Ivar Kreuger And The Swedish Match Empire is thriving in an atmosphere where there is potential development of companies. In addition to this, fact that store consumers are mostly looking for workplace supplies for office recommends that the market has a climbing pattern of entrepreneurs and home based businesses.

Social factors: Social fads in the economy reveal that customers are looking for convenience in addition to attractive rates. Market research shows how the client for Ivar Kreuger And The Swedish Match Empire does not have recognition regarding finding solutions which can provide a combination of benefit and inexpensive.

Technical factors: Modern technology plays a crucial duty in Ivar Kreuger And The Swedish Match Empire's business technique specifically as the company is piloting Technology facilities which would certainly provide innovation sales and also support in the form of memory upgrades, peripheral installations. (Summary of PEST in appendix 2).

OB Issues and also Effects.

A number of underlying Business Behavior concerns can be seen in Ivar Kreuger And The Swedish Match Empire's case as highlighted in this area.

Concerns regarding social adjustment: There is concern about a cultural change that would certainly happen when Todd Krasnow leaves from his position as the Exec Vice Head Of State of Marketing with a lot of the personnel currently revealing unhappiness over this possible relocation. This predicted modification has created tension in the workplace which has actually been paired with the previous tension of preparing the company for a possible merger with House Deport.
Pest Analysis
Stressful Work Setting for Newcomers: There is scarcity of employees that can match the demanding setting of a hectic organization. Not just does this lead to problem in locating the best individuals, it puts anxiety on brand-new hires as can not withstand the rate and stress that the company expects them to birth.

Dual Coverage Lines: Beginners locate this business culture cumbersome and difficult to deal with especially as dotted line connections are implied to be weaker as a whole and unbiased setting and also performance assessment is still done by the strong line supervisor. This means that newcomers can lose quality about their particular duties and goals particularly as dotted line coverage does not maintain them in straight interaction with the strong line managers.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his follower instead of Bridget Coles despite the fact that it had been guessed that the last would take Krasnow's position came as a strike to her spirits. Lewis may have been qualified as well as 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.

Anxiety & Job Instability: Anxiety as well as instability can be identified as two significant concerns that Lewis would be managing particularly as the merging has now be terminated and two elderly execs of the advertising and marketing division would be leaving. The whole obligation of the department would certainly be falling on Lewis's shoulders that would not simply supervise of brining regarding a social change yet would likewise have to confirm herself in her brand-new function.

Incompatible Administration Design of Leader: Lewis's monitoring design and its incompatibility with the marketing department's duty can likewise be seen as an OB difficulty particularly as she has been made use of to taking care of problems in the procedures division where employees are shown to focus on procedures and get them. The marketing department on the other hand can be viewed as a group of individuals who are utilized to being supported by Krasnow who focused more on output than processes.

Interdepartmental Arguments: Interdepartmental disputes between 3 divisions, marketing, merchandizing and procedures respectively over the allowance of the advertising mix can be identified as another OB concern. Although the advertising department does not share the same vision as the various other 2 divisions pertaining to the aloocation of the advertising and marketing mix twoards promos and also advertsing, the merchandizing and also procedures departments do not agree over the marketing mix appropriation amongst each other either.

Disintegration in Marketing Division: Disintegration in between the advertising and marketing divisions can be determined as another OB issue which might require further focus. The reality that the marketing and advertising areas in the marketing division are separated is avoiding both departments from acquiring from each other's experience and expertise. Integration of advertising with merchandising as well as operations would end up being more difficult if the marketing division itself is broken down which can be one more potential OB worry.

Ivar Kreuger And The Swedish Match Empire Analysis

Various concepts have actually been used to discuss the situations to get more quality concerning the scenario available.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, a lot of supervisors believe that staffs are passive and also lazy, have little aspiration as well as withstand adjustment. The situation at Ivar Kreuger And The Swedish Match Empire is not totally adhering to Theory X, it can be seen that new hires are finding this environment instead difficult which may eventually lead to a better inclination of the management in the direction of Theory X. Even while evaluating Lewis's administration design, theory X may have been ideal in the procedures division to some degree yet the Marketing division would certainly require reliance on Theory Y in order to obtain the creativity as well as creativity from the teams.

Tuckman's Teamwork Theory: Regarding Lewis's issue concerning bringing harmony in between the advertising and marketing department is worried, this would originally result in clash as gone over by Bruce Tuckman in his 'Synergy Concept'. (Tuckman, 1965). Based on Tuckman's concept shown in appendix 3, throughout the preliminary phase of group growth, individuals may not bond, as they are active locating their place in the team. By integrating the marketing and advertising division's job, there may be the same initial separate which can bring about the 2nd stage of 'storming' where the groups challenge one another. It is just during the 3rd stage or 'norming' when they would come with each other to share suggestions prior to the team can bring about harmony in the fourth stage 'performing'.

When people are provided with change, they go into phase one and so there might be feelings like despair, unpredictability, irritation, rage, concern, rejection as well as disorientation.The scenario at the advertising department of Ivar Kreuger And The Swedish Match Empire is similar so Lewis can get comfortable with the suggestion that it is not amazing actions. It is throughout this phase that Lewis will certainly have to offer guidance to the division so that they can discover a sense of instructions. It can be seen just how Krasnow has currently made this change simpler by making Lewis obtain included in the department a year before his real departure.
Vrio Analysis
Abraham Maslow in his Theory of 'Demands Pecking order' (appendix 5) has reviews the value of 'protection requires as being a reduced level requirement of a human for activating motivation. As seen in the pyramid shared in appendix 3, we can see how 'the demand to feel secure as well as out of danger' is at the second level of requirements. Before a worker can be made to create mentally, he needs to have his 'Physical 'and also 'Security' needs satisfied.

SWOT Analysis for Ivar Kreuger And The Swedish Match Empire Case Study

Ramification of Analysis.

The OB analysis has taken a look at numerous concepts to comprehend how to handle the present situation available. The adhering to 3 alternatives have been recommended to aid Lewis take care of the organizational obstacles in the marketing department. Each of these choices has been recommended for reducing the change required to bring the advertising department according to the requirements of the marketplace and also for making the social modification that would follow as soon as the existing leader leaves.

Integration of advertising and marketing features. Dividing Adverting as well as Manufacturing functions. Assimilation of Advertising with Workflow.

Evaluation of Alternatives.

Assimilation of Marketing & Advertising And Marketing Functions: The in-house advertising and marketing agency of Ivar Kreuger And The Swedish Match Empire is currently toughness for the company in regards to conserving up on expenses associated with advertising and promo. Since no new recruitment has been done after Bridget Cole's separation with the coverage line being straight assigned to Krasnow for the marketing function, this is a positive possibility for incorporating the advertising and marketing functions. Judith Shapiro that has earlier been talked to by Lewis during the earlier merger days has experience in business-to-business advertising together with agency and also retail marketing experience. Once Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising to take care of both marketing and advertising features.

The benefit of this technique is that it will incorporate both functions while reducing the requirement for hiring an additional source for advertising. In addition to this, Lewis would be heading the marketing department as well as all the same her substitute would be required for the present duty that she is performing. The downside of this choice is that outside hiring may bring about animosity from inner employees that may be looking at the placement of EVP after Lewis takes control of Krasnow's setting.

Separating Adverting and also Manufacturing: Offered the affordable stress and high quality job called for from the advertising and marketing agency, it is advised that Lewis must allow the production unit to be a different function from the advertising and marketing device. Given that a lot of marketing agencies had these two features as different systems, it makes even more sense to comply with the standard.

Assimilation of Advertising And Marketing with Workflows: Since Lewis is currently taking care of the advertising and procedures divisions concurrently; it makes good sense to integrate both functions because she has actually been effectively caring for both ends. The reality that both departments currently have significant distinctions over allowance of sources recommends that this combination might be able to cause harmony especially as Lewis would be heading both ends.However there are various disadvantages of this action specifically as it would certainly place excessive problem over Lewis's shoulders. The truth that Lewis has to adapt her management design for the advertising and marketing division suggests that these two departments would be culturally diverse. Lewis may not be able to apply one type of leadership style to both divisions which can result in inefficiency in either one of the two functions.


An evaluation of the 3 alternatives suggests that combination of marketing as well as procedures would not be a viable step due to the substantial differences in between the 2 divisions in spite of the reality that presently Lewis is taking care of both. While separation of the production feature might have been a desirable action for the advertising and marketing department, the reality that it would certainly imply placing a third feature under Lewis's wing suggests this ought to be avoided.

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

Marketing and advertising functions would certainly be combined.

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

Manufacturing function will certainly remain part of marketing under advertising feature.

Lewis will certainly separate herself from procedures.

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

Open up door plan and also emphasis on cross departmental interaction will certainly be targeted at getting rid of disharmony.

Backup strategy.

If the combination does not work out as planned, a contingency plan would certainly comply with which would certainly separate the production feature from the advertising and marketing feature to lower the lots on the SVP of marketing and advertising. In case Judith Shapiro does not get employed, Lewis will be heading the advertising department without an SVP. In that case the manufacturing feature will most definitely be divided by positioning it under an SVP production.