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Loblaw Companies Limited Acquiring Shoppers Drug Mart Case Study Solution

CASE ANALYSIS

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Background and Facts

Loblaw Companies Limited Acquiring Shoppers Drug Mart an office supplies seller for little and also moderate sized companies has actually just recently been involved in planning for a merger with its rival Residence Deport, which has impacted efficiency degrees in departmentswith the senior supervisor associated with lawful problems presented by the government Trade Commission. With the Advertising and marketing Head advancing the news of his departure from the company in one year, Jeannie Lewis, the present head of operations has been asked to take the function in the near future. With difficulties in the form of a possible social modification and reduced worker spirits, the organization wants a full reengineering effort at the marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The possible social modification at the marketing division of Loblaw Companies Limited Acquiring Shoppers Drug Mart is enhancing unpredictability in the working environment leading to different difficulties for the Jeannie Lewis that would be changing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in affecting strategic decisions considering that Stapes Inc. had to desert its strategies of merging with Office Deport after the Federal Trade Payment's intervention while doing so. Given the reality that the store has a worldwide presence with branches in UK, UNITED STATES, Canada and also Germany, political consider each of these countries might have the ability to impact performance or calculated goals. Federal Profession Payment's antitrust match versus the merging took up useful time of the organization's senior monitoring suggesting that 'political' factors can have severe ramifications for a global company.

Economic Factors: Financial factors such as the appearance of small businesses in the global situation recommend that Loblaw Companies Limited Acquiring Shoppers Drug Mart is flourishing in an atmosphere where there is potential growth of organisations. Fact that store customers are mostly looking for workplace materials for residence workplaces recommends that the market has a rising trend of business owners as well as house based companies.

Social factors: Social trends in the economy show that customers are searching for benefit along with attractive costs. Marketing research shows how the client for Loblaw Companies Limited Acquiring Shoppers Drug Mart does not have recognition regarding discovering remedies which can provide a combination of convenience and also affordable.

Technical factors: Technology plays a vital function in Loblaw Companies Limited Acquiring Shoppers Drug Mart's business approach especially as the organization is piloting Innovation centers which would use innovation sales as well as support in the form of memory upgrades, peripheral installments. (Recap of PARASITE in appendix 2).

OB Issues as well as Symptoms.

Several underlying Business Actions problems can be seen in Loblaw Companies Limited Acquiring Shoppers Drug Mart's case as highlighted in this section.

Uneasiness about cultural modification: There is apprehension about a cultural change that would take place when Todd Krasnow leaves from his placement as the Exec Vice President of Marketing with the majority of the team member already showing discontent over this prospective action. This expected modification has developed tension in the work environment which has actually been paired with the past stress of preparing the firm for a potential merging with Residence Deport.
Pest Analysis
Demanding Task Environment for Newcomers: There is scarcity of employees that can match the difficult environment of a fast-paced organization. Not only does this bring about difficulty in finding the right individuals, it places stress and anxiety on brand-new hires as can not hold up against the pace and also stress that the organization expects them to birth.

Double Reporting Lines: Newbies locate this business society troublesome as well as tough to cope with especially as populated line relationships are implied to be weaker generally and also unbiased setting and performance evaluation is still done by the strong line supervisor. This means that newbies might lose quality about their respective functions as well as goals particularly as dotted line coverage does not keep them in direct communication with the solid line managers.

Resentment From Cross Departmental Hiring: Krasnow's choice to make Lewis his follower instead of Bridget Coles although it had actually been guessed that the latter would take Krasnow's setting came as an impact to her morale. Lewis may have been capable and proper for the task but the truth that Kransnow's separation would certainly make Coles a straight record to Lewis might have been the factor for Coles' resignation from services.

Worry & Job Instability: Fear as well as insecurity can be identified as two significant problems that Lewis would be taking care of especially as the merging has actually now be terminated and also two senior executives of the advertising department would be leaving. The whole responsibility of the division would certainly be dropping on Lewis's shoulders who would not simply supervise of brining regarding a cultural change yet would certainly additionally have to show herself in her new function.

Inappropriate Monitoring Style of Leader: Lewis's administration design and its incompatibility with the marketing division's role can likewise be seen as an OB obstacle specifically as she has actually been utilized to dealing with issues in the procedures division where personnel are instructed to focus on processes and get them. The advertising division on the various other hand can be viewed as a team of people who are made use of to being supported by Krasnow that concentrated more on result than procedures.

Interdepartmental Differences: Interdepartmental differences in between three divisions, advertising and marketing, merchandizing and also operations specifically over the allowance of the advertising and marketing mix can be identified as another OB problem. The advertising department does not share the same vision as the other 2 divisions relating to the aloocation of the advertising mix twoards promos and advertsing, the merchandizing and operations departments do not concur over the advertising and marketing mix allowance among one an additional either.

Disintegration in Marketing Department: Disintegration between the advertising and marketing departments can be identified as an additional OB problem which might need more interest. The truth that the advertising and marketing sections in the advertising division are disconnected is preventing both departments from acquiring from each other's experience as well as expertise. Combination of marketing with retailing as well as procedures would come to be more difficult if the advertising division itself is disintegrated which can be one more potential OB worry.

Loblaw Companies Limited Acquiring Shoppers Drug Mart Analysis

Numerous concepts have actually been made use of to explain the situations to get additional clearness about the scenario at hand.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, a lot of managers believe that staffs are easy as well as careless, have little passion as well as withstand adjustment. The circumstance at Loblaw Companies Limited Acquiring Shoppers Drug Mart is not entirely following Concept X, it can be seen that brand-new hires are discovering this setting instead difficult which may at some point lead to a greater inclination of the monitoring towards Theory X. Also while assessing Lewis's management design, concept X might have been appropriate in the operations department to some degree yet the Advertising and marketing department would call for reliance on Theory Y in order to get the creative thinking and originality from the groups.

Tuckman's Teamwork Theory: As far as Lewis's concern concerning bringing harmony between the advertising and marketing division is concerned, this would at first bring about clash as reviewed by Bruce Tuckman in his 'Teamwork Theory'. (Tuckman, 1965). According to Tuckman's concept received appendix 3, throughout the preliminary stage of group development, people might not bond, as they are busy discovering their place in the team. By incorporating the marketing and advertising department's work, there may be the same initial disconnect which might result in the second phase of 'storming' where the teams test each other. It is just throughout the 3rd phase or 'norming' when they would come together to share ideas before the team can bring about harmony in the 4th stage 'executing'.

Bridges' Shift Design: Based On William Bridge's theory (appendix 4), people are quite awkward with modification, which is evident by the scenario at Loblaw Companies Limited Acquiring Shoppers Drug Mart The scenario can be seen as a normal program of life if is examined according to Bridge's theory where he explains that people experience 3 phases of change when they experience change. 'Ending, losing and also Releasing', The Neutral Area and 'The New Beginning' (Bridges, 2004). When people are presented with change, they go into phase one therefore there might be emotions like despair, unpredictability, frustration, anger, worry, rejection as well as disorientation.The circumstance at the marketing department of Loblaw Companies Limited Acquiring Shoppers Drug Mart is comparable so Lewis can get comfortable with the idea that it is not extraordinary behavior. In the 2nd phase, there might be a need to link the space between the brand-new and old society so Lewis may have to face this ordeal as soon as Krasnow leaves. There might be reduced morale as well as reduced productivity at this phase which ought to not be taken as a setback. It is during this phase that Lewis will certainly need to provide support to the department so that they can discover an orientation. It can be seen how Krasnow has actually currently made this change less complicated by making Lewis get associated with the division a year before his real departure. Based on Bridges' Version, phase three will cause visibility to knowing, High energy and commitment as people will certainly accept the adjustment (Bridges, 2004).
Vrio Analysis
Maslow's Need pecking order: The OB issue related to instability at the office has been set off first of all by the modification in administration and second of all by the fact that the merging will certainly no more be started. Abraham Maslow in his Theory of 'Requirements Power structure' (appendix 5) has discusses the relevance of 'security requires as being a reduced level demand of a human for activating motivation. As seen in the pyramid cooperated appendix 3, we can see exactly how 'the need to feel protected as well as out of danger' is at the 2nd degree of requirements. Before an employee can be made to create mentally, he requires to have his 'Physiological 'and 'Safety' needs satisfied. This suggests that unless the employees are made to really feel protected concerning their current employment standing in Loblaw Companies Limited Acquiring Shoppers Drug Mart they might not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Loblaw Companies Limited Acquiring Shoppers Drug Mart Case Study



Effects of Analysis.

The OB analysis has actually looked at different theories to recognize exactly how to manage the present circumstance available. The following 3 alternatives have been recommended to help Lewis deal with the organizational challenges in the advertising division. Each of these options has actually been suggested for reducing the shift required to bring the advertising and marketing department according to the demands of the market and also for making the cultural adjustment that would certainly adhere to as soon as the existing leader leaves.

Assimilation of marketing and advertising features. Separating Adverting and also Manufacturing features. Combination of Marketing with Operations.

Evaluation of Alternatives.

Assimilation of Marketing & Advertising And Marketing Functions: The internal advertising firm of Loblaw Companies Limited Acquiring Shoppers Drug Mart is currently stamina for the company in terms of conserving up on expenses connected to advertising and marketing and promotion. Considering that no brand-new recruitment has been done after Bridget Cole's departure with the coverage line being directly assigned to Krasnow for the marketing feature, this is a desirable chance for incorporating the advertising and marketing features. Judith Shapiro who has actually earlier been spoken with by Lewis during the earlier merging days has expertise in business-to-business advertising together with firm and retail advertising experience. Once Krasnow leaves, Lewis can employ Shapiro as an EVP for marketing to handle both marketing and advertising functions.

The advantage of this approach is that it will certainly integrate the two features while decreasing the demand for working with an additional resource for advertising. Along with this, Lewis would certainly be heading the advertising and marketing department and also regardless her substitute would be needed for the present role that she is carrying out. The downside of this option is that external hiring might bring about resentment from inner workers that may be eying the setting of EVP after Lewis takes control of Krasnow's setting.

Separating Adverting and Manufacturing: Provided the affordable stress and also high quality work called for from the marketing agency, it is advised that Lewis should enable the manufacturing system to be a separate function from the advertising and marketing unit. Considering that the majority of advertising and marketing agencies had these 2 functions as different units, it makes more feeling to adhere to the norm.

Combination of Marketing with Operations: Considering that Lewis is currently taking treatment of the advertising and marketing as well as operations divisions at the same time; it makes feeling to incorporate the 2 functions considering that she has actually been efficiently taking treatment of both ends. The truth that Lewis has to adjust her monitoring design for the marketing department suggests that these two divisions would be culturally varied.

Suggestion.



An analysis of the three options shows that integration of advertising and procedures would not be a practical move due to the vast differences in between both departments despite the fact that currently Lewis is dealing with both. While splitting up of the production function may have been a desirable step for the advertising division, the reality that it would certainly indicate putting a third feature under Lewis's wing suggests this ought to be prevented. The assimilation of the marketing division is the best option in regards to obtaining the optimal results from the department. An action prepare for this option is reviewed below.

Action Plan.
Recommendation
Lewis will take control of the role of EVP Advertising after Krasnow leaves.

Advertising and Marketing functions would certainly be combined.

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

Manufacturing feature will remain component of advertising and marketing under advertising and marketing feature.

Lewis will certainly separate herself from procedures.

A democratic leadership design with staff member empowerment will certainly be made use of in marketing department.

Open door plan and also emphasis on cross departmental communication will be aimed at getting rid of discord.

Backup plan.

If the integration does not exercise as intended, a contingency plan would comply with which would separate the manufacturing feature from the advertising function to lower the lots on the SVP of advertising and marketing. In case Judith Shapiro does not obtain hired, Lewis will be heading the advertising and marketing department without an SVP. In that case the production function will definitely be separated by putting it under an SVP manufacturing.