Sathavahana Strategies For Financial Turnaround Case Study Analysis


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Sathavahana Strategies For Financial Turnaround Case Study Analysis

Background and Facts

Sathavahana Strategies For Financial Turnaround a workplace products retailer for small and moderate sized businesses has actually lately been involved in planning for a merging with its competitor House Deport, which has affected effectiveness degrees in departmentswith the senior manager associated with lawful problems put forth by the federal Profession Commission. With the Advertising Head putting forward the information of his separation from the business in one year, Jeannie Lewis, the current head of procedures has been asked to take the duty in the future. With difficulties in the kind of a potential social adjustment and reduced staff member morale, the company is in need of a total reengineering initiative at the advertising and marketing division.

Trouble Declaration
Porter's 5 Forces Analysis
The prospective social adjustment at the advertising and marketing division of Sathavahana Strategies For Financial Turnaround is boosting unpredictability in the working environment leading to different obstacles for the Jeannie Lewis who would be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major function in affecting calculated choices considering that Stapes Inc. had to abandon its strategies of merging with Workplace Deport after the Federal Profession Compensation's intervention in the process. Provided the reality that the store has a worldwide visibility with branches in UK, USA, Canada as well as Germany, political factors in each of these nations might be able to influence performance or critical goals. Federal Profession Compensation's antitrust fit versus the merging took up valuable time of the company's elderly monitoring suggesting that 'political' factors can have major implications for a worldwide service.

Economic Factors: Economic factors such as the development of small companies in the global situation suggest that Sathavahana Strategies For Financial Turnaround is flourishing in an atmosphere where there is potential development of companies. Fact that store clients are mostly looking for workplace supplies for residence offices recommends that the market has a climbing trend of entrepreneurs and home based services.

Social factors: Social fads in the economic climate reveal that customers are trying to find convenience as well as appealing costs. Market research demonstrates how the client for Sathavahana Strategies For Financial Turnaround does not have recognition concerning locating solutions which can provide a mix of comfort and low costs.

Technical factors: Modern technology plays an essential duty in Sathavahana Strategies For Financial Turnaround's organisation approach particularly as the company is piloting Modern technology facilities which would use innovation sales and assistance in the kind of memory upgrades, outer installations. (Recap of PEST in appendix 2).

OB Issues as well as Effects.

Several underlying Organizational Behavior issues can be seen in Sathavahana Strategies For Financial Turnaround's case as highlighted in this section.

Apprehensions concerning social modification: There is apprehension about a social adjustment that would take place once Todd Krasnow leaves from his position as the Exec Vice President of Marketing with most of the staff members already revealing discontent over this possible action. This anticipated change has produced stress in the work environment which has been coupled with the past stress and anxiety of preparing the firm for a potential merging with Residence Deport.
Pest Analysis
Difficult Job Setting for Newcomers: There is lack of employees that can match the demanding environment of a fast-paced organization. Not only does this result in difficulty in discovering the ideal individuals, it places tension on new hires as can not hold up against the speed and also stress that the company anticipates them to bear.

Twin Reporting Lines: Newcomers discover this business culture troublesome as well as challenging to manage specifically as dotted line relationships are meant to be weaker in general and also objective setting and efficiency examination is still done by the solid line supervisor. This means that novices could lose clarity regarding their corresponding functions and goals specifically as populated line reporting does not keep them in straight interaction with the strong line supervisors.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor rather than Bridget Coles although it had actually been hypothesized that the latter would take Krasnow's placement came as a blow to her spirits. Lewis might have been qualified as well as ideal for the work yet the truth that Kransnow's separation would certainly make Coles a direct report to Lewis might have been the factor for Coles' resignation from solutions.

Worry & Job Insecurity: Concern and instability can be recognized as two significant concerns that Lewis would be taking care of particularly as the merger has currently be cancelled and two elderly execs of the advertising and marketing division would be leaving. The entire duty of the department would be falling on Lewis's shoulders that would not simply supervise of brining regarding a social adjustment yet would certainly likewise have to verify herself in her brand-new duty.

Incompatible Monitoring Design of Leader: Lewis's administration style as well as its conflict with the advertising and marketing division's duty can also be seen as an OB challenge especially as she has been used to taking care of concerns in the operations department where personnel are shown to concentrate on procedures and obtain them. The advertising department on the various other hand can be viewed as a team of individuals who are utilized to being nurtured by Krasnow that focused a lot more on result than processes.

Interdepartmental Disagreements: Interdepartmental differences in between three departments, marketing, merchandizing and also operations specifically over the appropriation of the advertising and marketing mix can be recognized as another OB worry. The advertising and marketing department does not share the same vision as the various other two divisions regarding the aloocation of the advertising and marketing mix twoards promotions and also advertsing, the merchandizing as well as operations divisions do not concur over the advertising mix allotment among one an additional either.

Fragmentation in Advertising Department: Fragmentation between the advertising and marketing departments can be recognized as another OB concern which might need further attention. The reality that the marketing and advertising sections in the advertising and marketing department are separated is preventing both departments from acquiring from each various other's experience and also know-how. Combination of marketing with retailing and also procedures would become harder if the advertising and marketing division itself is broken down which can be one more potential OB concern.

Sathavahana Strategies For Financial Turnaround Analysis

Numerous theories have been used to explain the situations to get further clearness concerning the circumstance at hand.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, many supervisors think that staffs are easy and careless, have little ambition and stand up to modification. The circumstance at Sathavahana Strategies For Financial Turnaround is not totally following Theory X, it can be seen that new hires are locating this environment rather stressful which might eventually lead to a greater inclination of the administration towards Concept X. Even while assessing Lewis's management style, theory X may have been appropriate in the procedures division to some degree but the Advertising and marketing department would certainly call for dependence on Concept Y in order to obtain the creative thinking and creativity from the groups.

Tuckman's Synergy Theory: As much as Lewis's problem concerning bringing consistency in between the advertising as well as marketing department is concerned, this would at first lead to conflict as gone over by Bruce Tuckman in his 'Teamwork Theory'. By incorporating the advertising and also advertising and marketing division's work, there may be the exact same preliminary detach which could lead to the 2nd stage of 'storming' where the teams test one an additional.

When individuals are offered with change, they go into phase one and so there may be emotions like unhappiness, uncertainty, disappointment, anger, fear, denial as well as disorientation.The circumstance at the advertising and marketing division of Sathavahana Strategies For Financial Turnaround is comparable so Lewis can get comfy with the idea that it is not phenomenal behavior. It is throughout this stage that Lewis will have to provide assistance to the division so that they can find a sense of instructions. It can be seen exactly how Krasnow has actually already made this change much easier by making Lewis obtain entailed in the department a year before his actual separation.
Vrio Analysis
Abraham Maslow in his Concept of 'Requirements Hierarchy' (appendix 5) has goes over the significance of 'safety and security needs as being a lower degree demand of a human for setting off inspiration. As seen in the pyramid shared in appendix 3, we can see just how 'the need to really feel secure as well as out of danger' is at the second level of needs. Prior to an employee can be made to create emotionally, he requires to have his 'Physical 'and 'Safety and security' needs fulfilled.

SWOT Analysis for Sathavahana Strategies For Financial Turnaround Case Study

Ramification of Analysis.

The OB analysis has considered various concepts to recognize how to cope with the current situation at hand. The following three alternatives have actually been suggested to aid Lewis handle the business difficulties in the marketing division. Each of these options has been suggested for easing the transition needed to bring the advertising and marketing division in line with the demands of the marketplace and also for making the social adjustment that would certainly adhere to when the existing leader leaves.

Integration of marketing and advertising features. Dividing Adverting as well as Manufacturing features. Assimilation of Advertising with Operations.

Assessment of Alternatives.

Integration of Advertising And Marketing & Marketing Functions: The internal marketing firm of Sathavahana Strategies For Financial Turnaround is currently strength for the organization in regards to conserving up on overheads associated with advertising and promotion. Given that no new employment has been done after Bridget Cole's departure with the reporting line being directly appointed to Krasnow for the advertising feature, this is a favorable possibility for incorporating the advertising and marketing features. Judith Shapiro who has actually earlier been interviewed by Lewis during the earlier merger days has know-how in business-to-business advertising and marketing along with agency as well as retail advertising experience. Once Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising to deal with both marketing and advertising features.

The benefit of this strategy is that it will certainly incorporate the two functions while lowering the requirement for employing an added source for marketing. Lewis would certainly be heading the advertising department and in any type of case her substitute would be needed for the existing function that she is doing. The negative aspect of this option is that exterior hiring might bring about bitterness from inner workers that may be considering the setting of EVP after Lewis takes control of Krasnow's setting.

Dividing Adverting and also Production: Provided the competitive pressures and high quality job called for from the advertising and marketing agency, it is advised that Lewis must allow the production unit to be a different function from the advertising unit. Considering that the majority of advertising companies had these two functions as separate systems, it makes even more sense to adhere to the norm.

Assimilation of Marketing with Operations: Because Lewis is already taking treatment of the advertising and marketing and procedures divisions simultaneously; it makes sense to incorporate the two features because she has actually been efficiently taking care of both ends. The reality that Lewis has to adapt her administration design for the advertising and marketing department suggests that these two departments would be culturally diverse.


An evaluation of the three choices indicates that combination of advertising and marketing and also operations would certainly not be a viable relocation due to the huge distinctions between both divisions despite the fact that currently Lewis is managing both. While separation of the production function might have been a positive step for the advertising division, the fact that it would imply putting a third feature under Lewis's wing implies this must be stayed clear of also. The assimilation of the advertising and marketing department is the most effective choice in regards to obtaining the ideal results from the department. An activity plan for this option is discussed below.

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

Marketing and advertising functions would certainly be merged.

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

Manufacturing function will continue to be part of advertising and marketing under advertising feature.

Lewis will certainly divide herself from operations.

An autonomous leadership design with worker empowerment will be utilized in advertising and marketing department.

Open up door plan and focus on cross department interaction will be targeted at getting rid of dissonance.

Backup strategy.

If the combination does not work out as prepared, a contingency strategy would certainly adhere to which would certainly separate the manufacturing feature from the advertising and marketing feature to decrease the load on the SVP of advertising and marketing. 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 definitely be separated by putting it under an SVP production.