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Pipes Private Equity Investments In Distressed Firms Case Study Analysis

CASE SOLUTION

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Pipes Private Equity Investments In Distressed Firms Case Study Solution

Background and Facts

Pipes Private Equity Investments In Distressed Firms an office supplies store for little and also average sized organisations has just recently been associated with planning for a merger with its rival Home Deport, which has influenced efficiency levels in departmentswith the senior manager associated with legal issues presented by the government Trade Payment. With the Marketing Head putting forward the information of his separation 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 potential social adjustment as well as low worker spirits, the organization wants a complete reengineering initiative at the marketing department.

Problem Statement
Porter's 5 Forces Analysis
The prospective cultural adjustment at the advertising division of Pipes Private Equity Investments In Distressed Firms is increasing unpredictability in the working environment resulting in various obstacles for the Jeannie Lewis who would be replacing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in impacting critical decisions since Stapes Inc. needed to abandon its plans of combining with Office Deport after the Federal Profession Commission's treatment while doing so. Given the reality that the store has a global presence with branches in UK, U.S.A., Canada and also Germany, political factors in each of these countries might be able to affect performance or calculated goals. Federal Profession Compensation's antitrust suit versus the merging used up valuable time of the organization's senior administration recommending that 'political' factors can have serious effects for a global company.

Economic Factors: Financial factors such as the appearance of small businesses in the worldwide scenario suggest that Pipes Private Equity Investments In Distressed Firms is flourishing in an atmosphere where there is possible growth of companies. Along with this, truth that shop consumers are mainly looking for workplace supplies for home offices suggests that the market has an increasing trend of business owners as well as home organisations.

Social factors: Social patterns in the economic climate reveal that customers are searching for ease in addition to eye-catching rates. Market research demonstrates how the consumer for Pipes Private Equity Investments In Distressed Firms does not have recognition concerning finding solutions which can provide a combination of comfort and also inexpensive.

Technological factors: Innovation plays a vital duty in Pipes Private Equity Investments In Distressed Firms's business strategy especially as the company is piloting Innovation facilities which would provide innovation sales as well as support in the kind of memory upgrades, peripheral installments. (Summary of PEST in appendix 2).

OB Issues and also Manifestations.

Numerous underlying Organizational Habits concerns can be seen in Pipes Private Equity Investments In Distressed Firms's case as highlighted in this area.

Apprehensions about social change: There is uneasiness about a cultural modification that would occur as soon as Todd Krasnow leaves from his position as the Exec Vice Head Of State of Advertising And Marketing with the majority of the personnel currently showing unhappiness over this potential action. This predicted adjustment has actually created stress in the work environment which has been paired with the previous stress of preparing the company for a possible merging with Home Deport.
Pest Analysis
Difficult Job Atmosphere for Newcomers: There is lack of personnel that can match the demanding environment of a busy company. Not only does this cause trouble in discovering the appropriate people, it puts anxiety on brand-new hires as can not endure the speed and pressure that the company anticipates them to bear.

Twin Reporting Lines: Newcomers find this business culture difficult as well as hard to deal with especially as dotted line relationships are implied to be weak in general as well as unbiased setting and efficiency evaluation is still done by the strong line manager. This indicates that novices might lose clarity regarding their particular functions as well as purposes specifically as dotted line reporting does not maintain them in direct interaction with the solid line supervisors.

Resentment From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor rather than Bridget Coles despite the fact that it had actually been hypothesized that the last would take Krasnow's position came as a blow to her morale. Lewis might have been qualified as well as proper for the job yet the fact that Kransnow's separation would make Coles a direct report to Lewis may have been the factor for Coles' resignation from solutions.

Worry & Task Instability: Concern and also instability can be recognized as two major issues that Lewis would be taking care of particularly as the merging has actually now be terminated as well as 2 elderly execs of the advertising department would be leaving. The entire obligation of the department would be falling on Lewis's shoulders who would not just supervise of brining about a cultural adjustment but would also have to verify herself in her new duty.

Inappropriate Management Design of Leader: Lewis's management style as well as its incompatibility with the advertising department's duty can additionally be seen as an OB difficulty especially as she has actually been utilized to dealing with concerns in the operations department where personnel are shown to concentrate on processes as well as obtain them. The marketing division on the various other hand can be seen as a group of people who are utilized to being supported by Krasnow who focused more on result than processes.

Interdepartmental Disputes: Interdepartmental disputes in between 3 departments, marketing, merchandizing and also operations specifically over the allotment of the marketing mix can be determined as another OB worry. The advertising and marketing department does not share the very same vision as the other two departments relating to the aloocation of the marketing mix twoards promotions as well as advertsing, the merchandizing as well as procedures departments do not agree over the advertising and marketing mix allocation amongst one an additional either.

Fragmentation in Advertising And Marketing Division: Disintegration between the marketing and advertising departments can be recognized as an additional OB issue which might need further interest. The fact that the marketing and advertising sections in the marketing division are disconnected is avoiding both divisions from gaining from each various other's experience and also experience. Assimilation of advertising with merchandising and operations would come to be harder if the advertising and marketing division itself is degenerated which can be an additional possible OB issue.

Pipes Private Equity Investments In Distressed Firms Analysis

Different concepts have been used to describe the situations to obtain additional quality concerning the circumstance available.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Concept X, the majority of supervisors think that staffs are passive and also careless, have little ambition and withstand change. The scenario at Pipes Private Equity Investments In Distressed Firms is not completely adhering to Concept X, it can be seen that new hires are discovering this setting instead difficult which might at some point lead to a better disposition of the administration towards Concept X. Also while evaluating Lewis's management design, theory X might have been ideal in the procedures division to some extent however the Advertising and marketing department would need reliance on Concept Y in order to get the imagination as well as creativity from the teams.

Tuckman's Teamwork Concept: As for Lewis's worry concerning bringing harmony in between the marketing and advertising department is worried, this would initially cause contrast as discussed by Bruce Tuckman in his 'Teamwork Theory'. (Tuckman, 1965). Based on Tuckman's theory displayed in appendix 3, during the initial phase of team growth, people might not bond, as they are hectic locating their location in the group. By integrating the marketing and advertising department's job, there may coincide initial detach which could bring about the 2nd stage of 'storming' where the teams test each other. It is only throughout the 3rd stage or 'norming' when they would come together to share concepts before the team can bring about synergy in the 4th phase 'performing'.

Bridges' Shift Model: As per William Bridge's concept (appendix 4), individuals are rather unpleasant with modification, which is obvious by the circumstance at Pipes Private Equity Investments In Distressed Firms The circumstance can be seen as a typical program of life if is examined as per Bridge's theory where he explains that people go through 3 phases of shift when they experience change. 'Ending, shedding and also Releasing', The Neutral Zone and 'The New Beginning' (Bridges, 2004). When people exist with change, they get in phase one therefore there may be emotions like despair, unpredictability, stress, rage, worry, denial as well as disorientation.The situation at the advertising and marketing division of Pipes Private Equity Investments In Distressed Firms is comparable so Lewis can get comfortable with the concept that it is not remarkable behavior. In the second phase, there may be a demand to link the void between the new as well as old culture so Lewis may have to face this ordeal when Krasnow leaves. There might be reduced spirits and also low performance at this stage which should not be taken as a setback. It is throughout this phase that Lewis will have to give support to the division so that they can locate an orientation. It can be seen how Krasnow has already made this transition much easier by making Lewis obtain involved in the division a year before his real separation. As per Bridges' Design, phase three will produce visibility to discovering, High power and also commitment as individuals will certainly welcome the adjustment (Bridges, 2004).
Vrio Analysis
Maslow's Demand pecking order: The OB problem related to instability at the office has been caused firstly by the adjustment in monitoring and also second of all by the truth that the merging will certainly no longer be initiated. Abraham Maslow in his Concept of 'Needs Pecking order' (appendix 5) has discusses the relevance of 'safety requires as being a reduced level requirement of a human for setting off motivation. As seen in the pyramid cooperated appendix 3, we can see how 'the requirement to feel safe and also safe' is at the second degree of requirements. Prior to a staff member can be made to establish mentally, he requires to have his 'Physical 'and also 'Safety' needs fulfilled. This suggests that unless the workers are made to really feel safe concerning their current employment condition in Pipes Private Equity Investments In Distressed Firms they might not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Pipes Private Equity Investments In Distressed Firms Case Study



Effects of Analysis.

The OB analysis has actually checked out various theories to recognize how to cope with the present scenario available. The adhering to three options have actually been suggested to help Lewis manage the organizational challenges in the advertising and marketing department. Each of these alternatives has been proposed for alleviating the transition required to bring the marketing division according to the demands of the market and for making the social change that would comply with once the present leader leaves.

Combination of marketing and advertising features. Separating Adverting as well as Production features. Combination of Advertising with Operations.

Analysis of Alternatives.

Judith Shapiro that has actually earlier been spoken with by Lewis throughout the earlier merging days has knowledge in business-to-business marketing along with firm and also retail marketing experience. When Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising and marketing to handle both marketing as well as advertising features.

The benefit of this strategy is that it will certainly integrate both functions while minimizing the need for working with an additional source for advertising. Lewis would be heading the advertising and marketing division and in any kind of case her substitute would be needed for the present function that she is performing. The drawback of this choice is that exterior hiring might bring about bitterness from internal workers that may be considering the placement of EVP after Lewis takes control of Krasnow's position.

Dividing Adverting and also Production: Offered the affordable pressures and high top quality job needed from the advertising company, it is suggested that Lewis needs to allow the manufacturing system to be a separate feature from the advertising device. Because most advertising firms had these two features as different systems, it makes more feeling to adhere to the standard.

Assimilation of Advertising And Marketing with Workflows: Because Lewis is currently taking care of the advertising as well as operations divisions at the same time; it makes sense to incorporate the 2 functions considering that she has actually been successfully taking care of both ends. The reality that Lewis has to adapt her management style for the marketing division suggests that these two divisions would be culturally varied.

Suggestion.



An examination of the three options shows that integration of marketing as well as procedures would certainly not be a feasible step due to the huge distinctions between both departments despite the fact that presently Lewis is taking care of both. While separation of the manufacturing feature may have been a positive relocation for the advertising division, the reality that it would mean putting a 3rd feature under Lewis's wing suggests this need to be avoided too. The integration of the advertising division is the best choice in terms of getting the optimum results from the division. An activity prepare for this option is discussed listed below.

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

Marketing and advertising functions would certainly be combined.

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

Production feature will certainly remain component of advertising under advertising and marketing feature.

Lewis will separate herself from procedures.

An autonomous management style with staff member empowerment will be made use of in advertising and marketing department.

Open up door plan as well as emphasis on cross departmental communication will certainly be focused on removing disharmony.

Backup plan.

If the integration does not exercise as prepared, a contingency strategy would follow which would certainly separate the manufacturing function from the advertising and marketing function to reduce the tons on the SVP of advertising and marketing. In case Judith Shapiro does not get hired, Lewis will certainly be heading the advertising division without an SVP. In that case the manufacturing function will certainly be divided by putting it under an SVP production.