Background and Facts
Penn West Petroleum Ltd an office products seller for tiny as well as medium sized companies has recently been associated with preparing for a merging with its rival Residence Deport, which has influenced efficiency levels in departmentswith the elderly manager associated with legal issues put forth by the government Profession Compensation. With the Marketing Head advancing the news of his departure from the firm in one year, Jeannie Lewis, the present head of operations has actually been asked to take the function in the future. With challenges in the type of a possible social change and reduced employee spirits, the company requires a total reengineering initiative at the marketing division.Problem Statement
The possible cultural modification at the marketing department of Penn West Petroleum Ltd is enhancing uncertainty in the working environment bring about numerous challenges 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 impacting tactical decisions considering that Stapes Inc. had to abandon its plans of combining with Office Deport after the Federal Trade Commission's treatment at the same time. Given the fact that the store has an international visibility with branches in UK, UNITED STATES, Canada and Germany, political factors in each of these nations may be able to influence efficiency or critical objectives. Federal Trade Commission's antitrust match versus the merger took up beneficial time of the organization's senior monitoring recommending that 'political' factors can have serious implications for a worldwide service.
Economic Factors: Financial factors such as the appearance of small companies in the international circumstance recommend that Penn West Petroleum Ltd is flourishing in an environment where there is prospective growth of organisations. Along with this, fact that store consumers are mainly trying to find workplace materials for office suggests that the marketplace has a rising fad of business owners and online companies.
Social factors: Social fads in the economy reveal that clients are seeking ease as well as appealing rates. Marketing research demonstrates how the customer for Penn West Petroleum Ltd lacks recognition concerning locating solutions which can use a mix of comfort and also low costs.
Technological factors: Technology plays an essential duty in Penn West Petroleum Ltd's business strategy particularly as the company is piloting Technology centers which would offer technology sales and assistance in the form of memory upgrades, outer installments. (Summary of PARASITE in appendix 2).
OB Issues as well as Effects.
Several underlying Business Habits issues can be seen in Penn West Petroleum Ltd's case as highlighted in this section.
Apprehensions concerning cultural adjustment: There is uneasiness about a social adjustment that would certainly happen once Todd Krasnow leaves from his placement as the Executive Vice Head Of State of Advertising And Marketing with the majority of the team member already showing discontent over this possible step. This anticipated change has actually created anxiety in the office which has actually been coupled with the past stress and anxiety of preparing the company for a possible merging with Residence Deport.
Difficult Work Setting for Newcomers: There is scarcity of employees that can match the difficult setting of a busy organization. Not only does this result in difficulty in finding the ideal individuals, it places stress and anxiety on new hires as can not endure the rate and stress that the company anticipates them to bear.
Double Reporting Lines: Novices discover this organizational society difficult and hard to deal with specifically as populated line partnerships are meant to be weaker generally as well as objective setting and efficiency assessment is still done by the strong line supervisor. This suggests that beginners can lose quality regarding their corresponding roles and purposes specifically as populated line reporting does not maintain them in direct interaction with the solid line managers.
Resentment From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor rather than Bridget Coles although it had actually been guessed that the last would certainly take Krasnow's position came as a strike to her morale. Lewis might have been capable as well as suitable for the task yet the fact that Kransnow's separation would certainly make Coles a direct report to Lewis might have been the reason for Coles' resignation from services.
Fear & Job Insecurity: Worry as well as insecurity can be recognized as 2 significant problems that Lewis would certainly be dealing with particularly as the merger has now be terminated as well as two senior executives of the advertising department would be leaving. The entire responsibility of the department would be falling on Lewis's shoulders who would certainly not just supervise of brining about a social modification but would certainly additionally need to show herself in her new role.
Incompatible Monitoring Style of Leader: Lewis's administration design and also its incompatibility with the advertising and marketing department's function can additionally be viewed as an OB difficulty specifically as she has been used to managing problems in the procedures division where employees are instructed to concentrate on processes and obtain them right. The advertising and marketing division on the various other hand can be viewed as a team of individuals who are made use of to being nurtured by Krasnow who concentrated more on output than processes.
Interdepartmental Disagreements: Interdepartmental disputes between three departments, advertising, merchandizing as well as operations specifically over the appropriation of the advertising and marketing mix can be recognized as another OB worry. The advertising department does not share the very same vision as the various other two divisions concerning the aloocation of the advertising mix twoards promotions and also advertsing, the merchandizing as well as procedures divisions do not concur over the advertising and marketing mix allocation among one an additional either.
Disintegration in Advertising Division: Disintegration between the marketing and advertising departments can be recognized as another OB problem which could need more interest. The truth that the advertising and marketing sections in the marketing department are disconnected is protecting against both divisions from getting from each various other's experience as well as expertise. Combination of advertising with merchandising and operations would certainly come to be more difficult if the advertising department itself is broken down which can be an additional possible OB issue.
Penn West Petroleum Ltd Analysis
Different theories have actually been made use of to clarify the situations to get more clearness about the situation available.
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, a lot of managers think that staffs are passive as well as lazy, have little ambition and resist change. The situation at Penn West Petroleum Ltd is not totally complying with Theory X, it can be seen that brand-new hires are finding this setting rather difficult which might ultimately lead to a higher disposition of the administration in the direction of Theory X. Also while examining Lewis's administration style, theory X may have been suitable in the operations department to some degree but the Advertising and marketing department would certainly require reliance on Concept Y in order to get the creative thinking as well as creativity from the groups.
Tuckman's Synergy Theory: As far as Lewis's issue about bringing harmony in between the advertising and marketing department is worried, this would at first cause conflict as gone over by Bruce Tuckman in his 'Team effort Theory'. (Tuckman, 1965). Based on Tuckman's theory received appendix 3, during the first stage of team growth, individuals might not bond, as they are active locating their location in the group. By integrating the advertising and marketing division's work, there might coincide first disconnect which can bring about the second stage of 'storming' where the groups test each other. Nonetheless, it is just throughout the 3rd stage or 'norming' when they would certainly integrate to share concepts prior to the team can bring about harmony in the fourth phase 'carrying out'.
When people are provided with adjustment, they enter phase one and also so there might be emotions like unhappiness, unpredictability, frustration, anger, fear, rejection as well as disorientation.The scenario at the advertising division of Penn West Petroleum Ltd is similar so Lewis can obtain comfy with the concept that it is not extraordinary actions. It is during this phase that Lewis will have to provide guidance to the department so that they can locate a feeling of direction. It can be seen exactly how Krasnow has actually currently made this transition less complicated by making Lewis get included in the department a year before his real departure.
Abraham Maslow in his Theory of 'Requirements Power structure' (appendix 5) has reviews the relevance of 'security needs as being a lower level need of a human for activating inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the need to feel secure and also out of danger' is at the second degree of needs. Prior to a staff member can be made to create mentally, he requires to have his 'Physical 'and 'Safety' requires met.
SWOT Analysis for Penn West Petroleum Ltd Case Study
Effects of Analysis.
The OB analysis has actually looked at different theories to understand how to cope with the existing scenario available. The adhering to three options have actually been proposed to aid Lewis handle the organizational obstacles in the advertising and marketing department. Each of these choices has actually been suggested for relieving the transition required to bring the marketing department according to the requirements of the marketplace as well as for making the social modification that would certainly follow once the current leader leaves.
Integration of advertising and marketing functions. Dividing Adverting as well as Production features. Combination of Advertising with Procedures.
Assessment of Alternatives.
Judith Shapiro who has actually earlier been interviewed by Lewis throughout the earlier merging days has knowledge in business-to-business marketing along with company and also retail advertising experience. As soon as Krasnow leaves, Lewis can work with Shapiro as an EVP for advertising to manage both advertising and marketing as well as advertising and marketing features.
The advantage of this strategy is that it will incorporate the two features while minimizing the requirement for hiring an added resource for advertising. Along with this, Lewis would certainly be heading the advertising and marketing division and in any case her replacement would be needed for the existing duty that she is doing. The negative aspect of this alternative is that exterior hiring might cause animosity from internal employees who may be looking at the placement of EVP after Lewis takes over Krasnow's placement.
Separating Adverting as well as Manufacturing: Provided the competitive stress and high quality work called for from the marketing firm, it is advised that Lewis needs to permit the production system to be a separate function from the marketing system. Since a lot of advertising and marketing agencies had these two features as different units, it makes even more feeling to follow the norm.
Combination of Marketing with Workflows: Since Lewis is already taking care of the marketing and operations departments at the same time; it makes sense to integrate both features because she has been successfully dealing with both ends. The fact that the two divisions already have significant differences over allotment of resources recommends that this combination might have the ability to cause consistency especially as Lewis would certainly be heading both ends.However there are different negative aspects of this action especially as it would certainly put excessive concern over Lewis's shoulders. The reality that Lewis needs to adapt her administration style for the advertising division suggests that these 2 departments would be culturally varied. Lewis might not be able to use one type of management design to both departments which could result in inefficiency in either one of the two features.
Recommendation.
An examination of the three choices shows that combination of advertising and marketing and also procedures would certainly not be a practical relocation because of the large differences between the two departments despite the fact that presently Lewis is dealing with both. While separation of the production feature might have been a positive move for the marketing department, the fact that it would certainly mean putting a third function under Lewis's wing indicates this should be stayed clear of. The integration of the marketing division is the most effective option in regards to getting the optimum arise from the department. An activity prepare for this alternative is reviewed below.
Activity Strategy.
Lewis will take over the duty of EVP Marketing after Krasnow leaves.
Advertising and Marketing functions would certainly be merged.
Judith Shapiro will be employed to take Lewis's location as SVP of advertising and marketing.
Manufacturing feature will certainly stay part of marketing under advertising and marketing feature.
Lewis will divide herself from procedures.
A democratic management design with employee empowerment will be made use of in marketing department.
Open up door plan and emphasis on cross departmental communication will be focused on eliminating disharmony.
Contingency plan.
If the assimilation does not work out as planned, a contingency strategy would comply with which would separate the manufacturing feature from the advertising feature to decrease the tons on the SVP of marketing and advertising. In case Judith Shapiro does not get worked with, Lewis will certainly be heading the marketing department without an SVP. Because case the manufacturing function will certainly be separated by placing it under an SVP manufacturing.