Salem Telephone Co Case Study Analysis


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Salem Telephone Co Case Study Solution

Background and Facts

Salem Telephone Co a workplace supplies seller for tiny as well as medium sized businesses has actually lately been associated with planning for a merging with its rival Residence Deport, which has influenced effectiveness degrees in departmentswith the senior supervisor involved in lawful problems put forth by the federal Trade Compensation. With the Marketing Head putting forward the information of his separation from the business in one year, Jeannie Lewis, the present head of operations has actually been asked to take the duty in the future. With difficulties in the type of a prospective social change as well as reduced employee spirits, the organization is in need of a total reengineering effort at the advertising division.

Trouble Statement
Porter's 5 Forces Analysis
The potential cultural adjustment at the marketing department of Salem Telephone Co is boosting unpredictability in the working environment causing various challenges for the Jeannie Lewis who would certainly be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in impacting strategic decisions because Stapes Inc. had to abandon its strategies of merging with Office Deport after the Federal Profession Commission's intervention at the same time. Provided the truth that the shop has a global presence with branches in UK, UNITED STATES, Canada as well as Germany, political consider each of these countries might be able to impact efficiency or critical objectives. Federal Profession Commission's antitrust suit versus the merger used up important time of the company's elderly monitoring recommending that 'political' factors can have severe implications for a global service.

Economic Factors: Financial factors such as the appearance of small companies in the global situation suggest that Salem Telephone Co is thriving in an environment where there is possible growth of organisations. Fact that store clients are primarily looking for office supplies for house workplaces recommends that the market has a rising pattern of entrepreneurs and also house based companies.

Social factors: Social trends in the economic climate show that customers are trying to find benefit in addition to attractive prices. Market research shows how the client for Salem Telephone Co does not have understanding regarding finding services which can supply a combination of ease and also low costs.

Technological factors: Innovation plays a crucial function in Salem Telephone Co's service strategy especially as the company is piloting Technology centers which would use innovation sales and assistance in the kind of memory upgrades, peripheral installments. (Summary of PEST in appendix 2).

OB Issues as well as Manifestations.

Numerous underlying Business Behavior problems can be seen in Salem Telephone Co's case as highlighted in this section.

Apprehensions concerning cultural change: There is uneasiness about a social modification that would happen when Todd Krasnow leaves from his placement as the Exec Vice President of Advertising with the majority of the employee currently revealing unhappiness over this possible step. This expected change has actually created anxiety in the workplace which has been coupled with the past stress of preparing the firm for a prospective merging with Home Deport.
Pest Analysis
Stressful Job Atmosphere for Newcomers: There is lack of personnel that can match the demanding setting of a fast-paced company. Not just does this bring about difficulty in finding the appropriate people, it places anxiety on brand-new hires as can not endure the pace and also stress that the organization expects them to bear.

Dual Reporting Lines: Novices locate this organizational culture difficult as well as difficult to deal with particularly as populated line relationships are suggested to be weaker generally and objective setup and efficiency assessment is still done by the solid line supervisor. This implies that novices could shed clarity about their respective duties and purposes especially as dotted line reporting does not maintain them in direct communication with the strong line managers.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his follower as opposed to Bridget Coles despite the fact that it had been speculated that the last would certainly take Krasnow's setting came as a strike to her morale. Lewis may have been qualified and also ideal for the job however the reality that Kransnow's departure would make Coles a straight report to Lewis might have been the factor for Coles' resignation from services.

Concern & Work Instability: Fear as well as insecurity can be determined as 2 significant concerns that Lewis would certainly be handling especially as the merger has currently be cancelled as well as 2 senior execs of the advertising and marketing division would be leaving. The whole responsibility of the department would certainly be dropping on Lewis's shoulders that would not just be in charge of brining concerning a cultural change but would additionally have to confirm herself in her brand-new duty.

Incompatible Management Style of Leader: Lewis's management style and also its incompatibility with the advertising and marketing division's duty can likewise be seen as an OB difficulty particularly as she has actually been used to handling concerns in the operations division where employees are shown to concentrate on procedures and get them. The marketing department on the various other hand can be viewed as a group of people that are used to being nurtured by Krasnow who focused a lot more on output than processes.

Interdepartmental Disagreements: Interdepartmental arguments between three divisions, advertising, merchandizing and also operations specifically over the allowance of the marketing mix can be determined as one more OB problem. The advertising department does not share the same vision as the other 2 divisions concerning the aloocation of the marketing mix twoards promotions and advertsing, the merchandizing and also operations departments do not concur over the advertising mix appropriation amongst one another either.

Disintegration in Marketing Division: Disintegration between the marketing and advertising departments can be determined as an additional OB concern which might need additional interest. The truth that the marketing and advertising sections in the marketing division are detached is protecting against both divisions from obtaining from each other's experience as well as know-how. Integration of marketing with retailing as well as procedures would certainly become more difficult if the advertising department itself is disintegrated which can be another possible OB problem.

Salem Telephone Co Analysis

Various concepts have actually been used to clarify the circumstances to get further clearness about the situation handy.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, the majority of supervisors believe that staffs are easy and careless, have little aspiration as well as resist modification. The scenario at Salem Telephone Co is not entirely complying with Theory X, it can be seen that brand-new hires are locating this environment rather stressful which may eventually lead to a better inclination of the administration in the direction of Concept X. Even while evaluating Lewis's management design, concept X might have been appropriate in the operations division to some level however the Advertising department would certainly call for reliance on Theory Y in order to obtain the creativity as well as creativity from the teams.

Tuckman's Synergy Concept: As for Lewis's worry about bringing harmony in between the marketing and advertising department is concerned, this would initially cause conflict as gone over by Bruce Tuckman in his 'Team effort Theory'. (Tuckman, 1965). As per Tuckman's theory displayed in appendix 3, throughout the preliminary stage of group growth, individuals may not bond, as they are hectic locating their place in the group. By combining the advertising and marketing department's job, there might coincide initial detach which could lead to the 2nd phase of 'storming' where the teams challenge one another. Nonetheless, it is just throughout the third phase or 'norming' when they would collaborate to share ideas prior to the group can bring about synergy in the 4th phase 'carrying out'.

When individuals are presented with modification, they get in stage one and also so there might be feelings like sadness, unpredictability, frustration, anger, anxiety, denial and disorientation.The circumstance at the marketing division of Salem Telephone Co is similar so Lewis can obtain comfy with the concept that it is not phenomenal habits. It is throughout this phase that Lewis will certainly have to provide guidance to the department so that they can discover a sense of direction. It can be seen exactly how Krasnow has already made this transition less complicated by making Lewis obtain involved in the division a year before his real separation.
Vrio Analysis
Abraham Maslow in his Theory of 'Demands Power structure' (appendix 5) has discusses the importance of 'safety and security requires as being a lower level demand of a human for setting off inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the demand to really feel protected as well as out of danger' is at the 2nd degree of demands. Before an employee can be made to create psychologically, he requires to have his 'Physiological 'and 'Security' needs satisfied.

SWOT Analysis for Salem Telephone Co Case Study

Effects of Analysis.

The OB analysis has actually checked out different theories to comprehend exactly how to cope with the existing scenario available. The complying with 3 choices have actually been suggested to aid Lewis handle the organizational challenges in the marketing division. Each of these choices has actually been suggested for reducing the shift needed to bring the advertising division in line with the needs of the market and also for making the cultural adjustment that would follow as soon as the present leader leaves.

Assimilation of advertising and marketing functions. Separating Adverting and Manufacturing functions. Combination of Advertising And Marketing with Procedures.

Evaluation of Alternatives.

Integration of Marketing & Marketing Functions: The internal advertising firm of Salem Telephone Co is already toughness for the company in terms of conserving up on overheads related to advertising as well as promotion. Considering that no new employment has been done after Bridget Cole's departure with the coverage line being directly assigned to Krasnow for the advertising function, this is a positive chance for integrating the marketing and advertising functions. Judith Shapiro that has earlier been talked to by Lewis throughout the earlier merging days has expertise in business-to-business advertising along with agency as well as retail advertising and marketing experience. As soon as Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to deal with both advertising and marketing features.

The advantage of this method is that it will integrate the two functions while reducing the need for employing an extra source for advertising and marketing. Lewis would certainly be heading the marketing department and also in any kind of case her replacement would certainly be needed for the existing function that she is carrying out. The negative aspect of this choice is that external hiring may produce animosity from interior personnel who might be eying the setting of EVP after Lewis takes control of Krasnow's position.

Dividing Adverting as well as Manufacturing: Provided the affordable stress as well as high quality job called for from the advertising agency, it is recommended that Lewis ought to enable the manufacturing device to be a separate function from the advertising and marketing system. Because many advertising agencies had these 2 functions as separate devices, it makes even more sense to comply with the norm. In addition to this, both features may be able to concentrate on their core activates extra effectively. The disadvantage of this method would be that added costs would certainly have to be borne for setting up separate manufacturing functions. In addition to this, a production head might need to be hired which can enhance expenses for the organization.

Assimilation of Marketing with Operations: Since Lewis is currently dealing with the marketing and operations departments at the same time; it makes good sense to integrate the two features given that she has been successfully looking after both ends. The truth that both departments currently have major distinctions over allotment of sources recommends that this integration may be able to cause harmony specifically as Lewis would be heading both ends.However there are various drawbacks of this action specifically as it would place excessive concern over Lewis's shoulders. The fact that Lewis has to adjust her administration style for the advertising and marketing division suggests that these 2 divisions would be culturally varied. Lewis may not be able to use one type of management design to both divisions which can result in inadequacy in either one of the 2 functions.


An examination of the 3 options suggests that integration of advertising and marketing and also procedures would not be a possible step due to the substantial differences in between the 2 divisions in spite of the reality that currently Lewis is taking care of both. While separation of the production function may have been a favorable step for the advertising and marketing division, the reality that it would certainly mean putting a 3rd function under Lewis's wing implies this must be stayed clear of.

Activity Plan.
Lewis will take control of the duty of EVP Advertising and marketing after Krasnow leaves.

Advertising and Marketing features would be merged.

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

Production feature will certainly continue to be part of marketing under advertising and marketing feature.

Lewis will certainly divide herself from procedures.

An autonomous management style with worker empowerment will be utilized in advertising and marketing department.

Open door plan as well as focus on cross departmental interaction will certainly be aimed at getting rid of dissonance.

Contingency plan.

If the combination does not work out as intended, a backup plan would certainly follow which would certainly divide the manufacturing function from the marketing feature to lower the lots on the SVP of marketing and advertising. In case Judith Shapiro does not obtain employed, Lewis will be heading the marketing department without an SVP. In that case the production function will certainly be separated by putting it under an SVP manufacturing.