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Philip Morris Companies Inc B Case Study Solution

Background and Facts

Philip Morris Companies Inc B a workplace materials merchant for small and moderate sized companies has recently been involved in preparing for a merger with its rival Home Deport, which has influenced efficiency levels in departmentswith the senior supervisor involved in legal issues put forth by the government Profession Payment. With the Advertising and marketing Head advancing the information of his departure from the business in one year, Jeannie Lewis, the current head of procedures has actually been asked to take the duty in the future. With obstacles in the type of a possible cultural modification and low worker spirits, the organization is in need of a full reengineering effort at the marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The possible social change at the advertising department of Philip Morris Companies Inc B is enhancing uncertainty in the working environment resulting in various obstacles for the Jeannie Lewis that would certainly be replacing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in impacting calculated decisions since Stapes Inc. needed to abandon its strategies of merging with Office Deport after the Federal Trade Payment's treatment in the process. Offered the reality that the store has a worldwide existence with branches in UK, UNITED STATES, Canada and also Germany, political consider each of these nations might have the ability to impact performance or strategic objectives. Federal Profession Commission's antitrust match versus the merger took up useful time of the company's elderly management recommending that 'political' factors can have major implications for a global company.

Economic Factors: Economic factors such as the development of small businesses in the international situation suggest that Philip Morris Companies Inc B is growing in an environment where there is prospective growth of services. Truth that shop consumers are mainly looking for office products for house offices suggests that the market has a climbing fad of entrepreneurs and also home based companies.

Social factors: Social fads in the economic climate show that consumers are seeking convenience along with eye-catching prices. Market research shows how the client for Philip Morris Companies Inc B lacks understanding concerning locating solutions which can supply a mix of benefit and also low costs.

Technological factors: Modern technology plays a vital function in Philip Morris Companies Inc B's organisation approach particularly as the company is piloting Modern technology centers which would certainly offer technology sales and also support in the type of memory upgrades, outer installations. (Recap of INSECT in appendix 2).

OB Issues and Effects.

A number of underlying Organizational Habits problems can be seen in Philip Morris Companies Inc B's case as highlighted in this area.

Concerns about social modification: There is apprehension regarding a social adjustment that would certainly occur once Todd Krasnow leaves from his setting as the Executive Vice President of Marketing with most of the employee already showing unhappiness over this prospective relocation. This predicted adjustment has actually created stress and anxiety in the work environment which has actually been paired with the past stress of preparing the firm for a potential merging with House Deport.
Pest Analysis
Demanding Job Setting for Newcomers: There is scarcity of workers that can match the difficult atmosphere of a busy company. Not only does this cause trouble in discovering the right people, it places stress and anxiety on brand-new hires as can not hold up against the speed and also pressure that the company expects them to bear.

Double Reporting Lines: Beginners discover this organizational culture difficult and difficult to cope with particularly as dotted line relationships are implied to be weaker generally and also objective setting as well as efficiency analysis is still done by the solid line supervisor. This implies that novices could shed quality about their corresponding duties and also objectives particularly as populated line coverage does not keep them in direct interaction with the solid line managers.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor as opposed to Bridget Coles despite the fact that it had been hypothesized that the last would take Krasnow's placement came as a blow to her morale. Lewis might have been qualified as well as appropriate for the work however the fact that Kransnow's departure would certainly make Coles a direct report to Lewis may have been the reason for Coles' resignation from solutions.

Fear & Job Instability: Worry and insecurity can be determined as two major problems that Lewis would certainly be handling specifically as the merger has actually now be cancelled and also 2 senior execs of the advertising and marketing division would certainly be leaving. The whole responsibility of the department would certainly be falling on Lewis's shoulders that would certainly not just be in charge of brining about a social modification yet would likewise need to prove herself in her new role.

Inappropriate Monitoring Design of Leader: Lewis's administration style as well as its conflict with the advertising department's duty can additionally be viewed as an OB difficulty specifically as she has been made use of to handling problems in the operations division where workers are instructed to concentrate on processes as well as get them right. The advertising department on the other hand can be seen as a team of people that are used to being nurtured by Krasnow who concentrated more on output than procedures.

Interdepartmental Differences: Interdepartmental disputes between 3 divisions, marketing, merchandizing and operations respectively over the allowance of the marketing mix can be determined as an additional OB problem. The advertising and marketing division does not share the very same vision as the other 2 divisions regarding the aloocation of the advertising and marketing mix twoards promotions as well as advertsing, the merchandizing as well as operations departments do not concur over the marketing mix allocation among one an additional either.

Fragmentation in Advertising And Marketing Department: Fragmentation in between the advertising and marketing departments can be determined as one more OB concern which might require additional interest. The truth that the marketing and advertising sections in the advertising and marketing division are separated is avoiding both departments from gaining from each other's experience and also knowledge. Assimilation of marketing with merchandising and also operations would certainly become harder if the marketing department itself is broken down which can be another potential OB problem.

Philip Morris Companies Inc B Analysis

Different concepts have been utilized to explain the scenarios to get further clarity regarding the situation at hand.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, most supervisors think that juniors are passive and careless, have little ambition as well as resist modification. The situation at Philip Morris Companies Inc B is not totally adhering to Theory X, it can be seen that new hires are locating this environment instead stressful which might ultimately lead to a greater inclination of the administration towards Concept X. Also while assessing Lewis's administration style, concept X may have been ideal in the operations department to some level however the Advertising division would call for reliance on Theory Y in order to obtain the creativity and also originality from the teams.

Tuckman's Synergy Theory: As much as Lewis's concern concerning bringing harmony between the advertising and also advertising division is concerned, this would initially lead to clash as gone over by Bruce Tuckman in his 'Teamwork Theory'. By integrating the marketing as well as advertising and marketing department's work, there may be the same initial separate which can lead to the 2nd stage of 'storming' where the groups challenge one an additional.

When people are presented with modification, they get in phase one and so there may be feelings like sadness, uncertainty, aggravation, rage, fear, rejection and also disorientation.The scenario at the marketing division of Philip Morris Companies Inc B is comparable so Lewis can obtain comfortable with the suggestion that it is not extraordinary habits. It is throughout this stage that Lewis will have to give support to the department so that they can locate a sense of instructions. It can be seen exactly how Krasnow has actually already made this shift easier by making Lewis get involved in the department a year before his real departure.
Vrio Analysis
Abraham Maslow in his Theory of 'Requirements Hierarchy' (appendix 5) has reviews the value of 'safety and security requires as being a lower level demand of a human for activating motivation. As seen in the pyramid shared in appendix 3, we can see how 'the requirement to feel protected and out of risk' is at the 2nd degree of requirements. Before a staff member can be made to establish mentally, he requires to have his 'Physiological 'and 'Safety and security' requires fulfilled.

SWOT Analysis for Philip Morris Companies Inc B Case Study

Effects of Analysis.

The OB analysis has taken a look at numerous theories to recognize how to manage the current scenario available. The adhering to 3 choices have actually been recommended to help Lewis manage the organizational obstacles in the advertising department. Each of these choices has actually been proposed for relieving the transition needed to bring the advertising and marketing division in line with the demands of the marketplace and for making the social adjustment that would comply with once the existing leader leaves.

Assimilation of marketing and advertising features. Dividing Adverting as well as Production features. Combination of Advertising with Workflow.

Examination of Alternatives.

Judith Shapiro who has earlier been interviewed by Lewis throughout the earlier merger days has proficiency in business-to-business advertising along with agency as well as retail advertising experience. As soon as Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to handle both advertising and marketing and also marketing functions.

The advantage of this strategy is that it will certainly incorporate the two features while reducing the demand for employing an added source for marketing. Lewis would certainly be heading the advertising and marketing department and also in any case her replacement would be needed for the present role that she is performing. The negative aspect of this option is that exterior hiring may produce resentment from interior personnel that may be eying the position of EVP after Lewis takes over Krasnow's position.

Dividing Adverting and also Manufacturing: Given the affordable stress as well as high top quality work needed from the advertising and marketing firm, it is advised that Lewis should allow the production unit to be a separate feature from the advertising device. Because many advertising companies had these 2 functions as different systems, it makes more sense to follow the norm.

Integration of Advertising And Marketing with Operations: Considering that Lewis is currently taking care of the advertising and also procedures divisions simultaneously; it makes sense to incorporate both functions because she has been successfully taking care of both ends. The fact that the two divisions currently have significant distinctions over allowance of sources recommends that this integration may be able to cause harmony especially as Lewis would certainly be heading both ends.However there are various negative aspects of this move specifically as it would place excessive concern over Lewis's shoulders. The reality that Lewis needs to adapt her administration design for the advertising and marketing division suggests that these two divisions would certainly be culturally varied. Lewis might not be able to use one type of management style to both departments which might result in inadequacy in either one of the 2 functions.


An analysis of the 3 options shows that integration of advertising as well as operations would not be a feasible relocation due to the large differences in between the two divisions in spite of the reality that currently Lewis is taking care of both. While separation of the production function may have been a beneficial step for the advertising and marketing department, the fact that it would suggest placing a 3rd feature under Lewis's wing implies this need to be prevented.

Activity Plan.
Lewis will certainly take over the function of EVP Advertising and marketing after Krasnow leaves.

Advertising and Marketing functions would certainly be combined.

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

Manufacturing feature will stay part of advertising under advertising and marketing function.

Lewis will certainly separate herself from operations.

A democratic leadership design with worker empowerment will certainly be used in marketing division.

Open door policy and focus on cross departmental communication will be focused on removing dissonance.

Backup plan.

If the combination does not exercise as intended, a backup strategy would adhere to which would certainly separate the manufacturing feature from the advertising and marketing function to reduce the lots on the SVP of advertising and marketing. In case Judith Shapiro does not obtain hired, Lewis will be heading the marketing division without an SVP. Because case the manufacturing feature will definitely be divided by placing it under an SVP manufacturing.