Rent Seeking Behaviour In The Power Market Case Study Solution


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Rent Seeking Behaviour In The Power Market Case Study Analysis

Background and Facts

Rent Seeking Behaviour In The Power Market a workplace products retailer for tiny as well as medium sized businesses has actually just recently been associated with preparing for a merger with its competitor Residence Deport, which has impacted efficiency levels in departmentswith the senior manager involved in lawful complications put forth by the government Profession Payment. With the Advertising Head putting forward the information of his separation from the company in one year, Jeannie Lewis, the current head of operations has been asked to take the function in the future. With difficulties in the kind of a possible cultural change as well as low staff member spirits, the organization wants a full reengineering initiative at the advertising and marketing division.

Issue Statement
Porter's 5 Forces Analysis
The potential cultural change at the advertising and marketing division of Rent Seeking Behaviour In The Power Market is raising uncertainty in the workplace bring about numerous difficulties for the Jeannie Lewis that would be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major duty in influencing calculated decisions given that Stapes Inc. needed to desert its strategies of combining with Workplace Deport after the Federal Profession Payment's intervention in the process. Provided the fact that the store has an international visibility with branches in UK, USA, Canada and also Germany, political factors in each of these nations may have the ability to impact efficiency or calculated goals. Federal Trade Payment's antitrust match against the merging took up useful time of the company's senior management recommending that 'political' factors can have severe implications for an international business.

Economic Factors: Economic factors such as the appearance of small businesses in the international situation suggest that Rent Seeking Behaviour In The Power Market is prospering in an environment where there is possible growth of companies. In addition to this, fact that store clients are primarily trying to find workplace products for home offices recommends that the marketplace has a climbing fad of entrepreneurs as well as online services.

Social factors: Social trends in the economic situation show that customers are seeking ease along with eye-catching costs. Marketing research shows how the client for Rent Seeking Behaviour In The Power Market does not have recognition regarding discovering options which can offer a mix of benefit as well as affordable.

Technical factors: Innovation plays an essential duty in Rent Seeking Behaviour In The Power Market's company approach especially as the company is piloting Modern technology facilities which would supply innovation sales as well as support in the form of memory upgrades, outer installations. (Summary of INSECT in appendix 2).

OB Issues and also Effects.

A number of underlying Organizational Habits concerns can be seen in Rent Seeking Behaviour In The Power Market's case as highlighted in this section.

Concerns about cultural modification: There is concern concerning a cultural adjustment that would take place once Todd Krasnow leaves from his placement as the Exec Vice President of Marketing with a lot of the personnel currently showing discontent over this prospective relocation. This anticipated modification has created tension in the office which has actually been paired with the past stress of preparing the company for a potential merger with Home Deport.
Pest Analysis
Stressful Task Setting for Newcomers: There is lack of personnel that can match the difficult atmosphere of a fast-paced organization. Not only does this cause problem in finding the right people, it places anxiety on brand-new hires as can not hold up against the rate and pressure that the organization expects them to birth.

Twin Reporting Lines: Beginners find this organizational society cumbersome as well as challenging to handle especially as populated line partnerships are indicated to be weaker generally and objective setup and also performance analysis is still done by the solid line manager. This suggests that beginners can shed clearness regarding their particular roles and purposes specifically as populated line coverage does not keep them in straight communication with the strong line supervisors.

Resentment From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor as opposed to Bridget Coles even though it had actually been hypothesized that the last would certainly take Krasnow's position came as an impact to her morale. Lewis may have been capable as well as suitable for the work however the truth that Kransnow's departure would make Coles a direct record to Lewis might have been the factor for Coles' resignation from services.

Anxiety & Task Instability: Fear and insecurity can be recognized as two major worries that Lewis would certainly be dealing with specifically as the merging has currently be terminated and also 2 senior executives of the marketing division would be leaving. The entire responsibility of the division would certainly be falling on Lewis's shoulders who would not simply be in charge of brining concerning a cultural modification but would likewise need to verify herself in her brand-new function.

Incompatible Management Design of Leader: Lewis's administration design and its incompatibility with the advertising and marketing department's duty can likewise be seen as an OB difficulty particularly as she has actually been utilized to managing issues in the procedures department where workers are shown to focus on processes and get them. The advertising division on the other hand can be seen as a group of individuals who are used to being supported by Krasnow who focused a lot more on result than processes.

Interdepartmental Differences: Interdepartmental differences between three departments, advertising, merchandizing and procedures respectively over the allowance of the marketing mix can be identified as another OB issue. The marketing department does not share the same vision as the various other two divisions relating to the aloocation of the advertising mix twoards promos and also advertsing, the merchandizing and procedures divisions do not concur over the marketing mix allocation amongst one an additional either.

Disintegration in Marketing Department: Fragmentation between the advertising and marketing departments can be determined as an additional OB concern which might need more interest. The reality that the marketing and advertising areas in the advertising and marketing division are disconnected is preventing both divisions from gaining from each various other's experience and also expertise. Assimilation of advertising with merchandising as well as operations would become more difficult if the advertising and marketing division itself is disintegrated which can be an additional possible OB issue.

Rent Seeking Behaviour In The Power Market Analysis

Various concepts have been used to clarify the circumstances to obtain additional quality about the scenario available.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Concept X, most supervisors think that staffs are passive and also lazy, have little ambition and withstand modification. The tough version of this theory highlighted threat, tight controls, dangers as well as punishments. In time it produces reduced efficiency, subtle sabotage as well as competition (Bargain, 2003). Although the situation at Rent Seeking Behaviour In The Power Market is not completely complying with Concept X, it can be seen that new hires are finding this atmosphere instead demanding which may eventually cause a greater disposition of the administration towards Theory X. As per McGregor's advocated view, which he called Theory Y, the important task of the administration is to set up organizational conditions to make sure that individuals can accomplish their own objectives best by directing their initiatives towards organizational rewards. If individuals find no satisfaction in their work, the management would certainly have little selection however to depend on concept X as well as outside control (Bargain, 2003). Also while examining Lewis's monitoring style, theory X may have been suitable in the procedures division somewhat however the Advertising department would need reliance on Theory Y to get the creative thinking and creativity from the groups.

Tuckman's Teamwork Concept: As far as Lewis's concern regarding bringing harmony between the marketing as well as advertising department is worried, this would initially lead to contrast as talked about by Bruce Tuckman in his 'Synergy Concept'. By combining the advertising and marketing and advertising department's work, there might be the same first disconnect which can lead to the second stage of 'storming' where the teams test one another.

When individuals are provided with modification, they go into stage one as well as so there may be feelings like sadness, uncertainty, aggravation, temper, worry, rejection as well as disorientation.The scenario at the marketing department of Rent Seeking Behaviour In The Power Market is comparable so Lewis can get comfy with the idea that it is not remarkable actions. It is during this phase that Lewis will certainly have to give guidance to the division so that they can find a sense of instructions. It can be seen how Krasnow has actually already made this change much easier by making Lewis get involved in the division a year prior to his actual departure.
Vrio Analysis
Maslow's Need hierarchy: The OB concern related to instability at the workplace has actually been activated firstly by the adjustment in monitoring and also secondly by the fact that the merger will certainly no more be started. Abraham Maslow in his Theory of 'Requirements Hierarchy' (appendix 5) has discusses the value of 'security needs as being a reduced degree need of a human for setting off motivation. As seen in the pyramid shared in appendix 3, we can see how 'the requirement to really feel protected and also out of danger' is at the 2nd degree of demands. Before a worker can be made to develop psychologically, he needs to have his 'Physical 'and also 'Safety' needs met. This indicates that unless the workers are made to really feel secure regarding their current employment condition in Rent Seeking Behaviour In The Power Market they might not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Rent Seeking Behaviour In The Power Market Case Study

Implication of Analysis.

The OB analysis has actually checked out various theories to understand how to handle the current scenario at hand. The complying with three options have actually been recommended to aid Lewis handle the business difficulties in the marketing division. Each of these options has actually been suggested for easing the change needed to bring the advertising and marketing division in accordance with the requirements of the marketplace and for making the cultural change that would certainly follow once the existing leader leaves.

Integration of marketing and advertising functions. Separating Adverting and also Manufacturing features. Assimilation of Advertising with Procedures.

Assessment of Alternatives.

Integration of Advertising And Marketing & Advertising And Marketing Functions: The internal advertising firm of Rent Seeking Behaviour In The Power Market is already strength for the organization in terms of saving up on expenses connected to advertising as well as promo. Given that no brand-new recruitment has been done after Bridget Cole's separation with the reporting line being directly designated to Krasnow for the advertising and marketing function, this is a desirable chance for integrating the marketing and advertising features. Judith Shapiro that has actually earlier been spoken with by Lewis throughout the earlier merger days has experience in business-to-business advertising along with company and retail marketing experience. When Krasnow leaves, Lewis can hire Shapiro as an EVP for marketing to deal with both advertising and marketing functions.

The advantage of this strategy is that it will integrate the two functions while lowering the demand for employing an extra source for advertising. Lewis would be heading the marketing department as well as in any case her replacement would be required for the existing duty that she is executing. The downside of this option is that external hiring might bring about animosity from inner workers that might be eying the setting of EVP after Lewis takes control of Krasnow's placement.

Dividing Adverting and also Manufacturing: Provided the affordable stress and also high quality job needed from the marketing firm, it is recommended that Lewis ought to permit the manufacturing system to be a different feature from the advertising device. Because a lot of advertising companies had these 2 functions as separate devices, it makes even more feeling to adhere to the norm.

Combination of Advertising with Procedures: Given that Lewis is currently taking treatment of the marketing as well as operations divisions at the same time; it makes feeling to integrate the two features given that she has been efficiently taking care of both ends. The reality that Lewis has to adjust her monitoring design for the marketing department suggests that these 2 departments would certainly be culturally diverse.


An examination of the three options indicates that integration of advertising as well as procedures would certainly not be a viable relocation due to the huge distinctions in between both departments although that currently Lewis is taking care of both. While splitting up of the manufacturing function may have been a beneficial action for the marketing division, the reality that it would suggest putting a 3rd feature under Lewis's wing means this need to be avoided as well. The integration of the advertising and marketing division is the best option in terms of getting the optimal results from the department. An action prepare for this alternative is reviewed listed below.

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

Marketing and advertising features would be merged.

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

Manufacturing feature will certainly continue to be part of marketing under marketing feature.

Lewis will certainly divide herself from operations.

A democratic management design with worker empowerment will be utilized in marketing department.

Open up door plan as well as emphasis on cross department interaction will certainly be targeted at eliminating discord.

Contingency plan.

If the integration does not work out as prepared, a backup plan would adhere to which would divide the production function from the advertising feature to lower the load on the SVP of advertising and marketing. In case Judith Shapiro does not get employed, Lewis will be heading the advertising department without an SVP. Because case the production feature will certainly be separated by positioning it under an SVP production.