Stock Options And Compensation Case Study Analysis


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Stock Options And Compensation Case Study Solution

Background and Facts

Stock Options And Compensation an office products seller for tiny and moderate sized services has actually just recently been involved in preparing for a merger with its competitor Residence Deport, which has impacted performance degrees in departmentswith the elderly manager associated with legal complications presented by the federal Profession Compensation. With the Marketing Head advancing the news of his departure from the company in one year, Jeannie Lewis, the present head of operations has actually been asked to take the function in the future. With difficulties in the kind of a potential cultural modification and also low worker morale, the organization requires a full reengineering initiative at the marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The possible cultural change at the advertising department of Stock Options And Compensation is raising uncertainty in the workplace leading to numerous difficulties for the Jeannie Lewis who would be changing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in influencing tactical choices because Stapes Inc. had to abandon its plans of combining with Office Deport after the Federal Trade Payment's treatment in the process. Given the truth that the store has a worldwide visibility with branches in UK, UNITED STATES, Canada and Germany, political factors in each of these nations may have the ability to impact efficiency or critical objectives. Federal Profession Compensation's antitrust fit versus the merger occupied useful time of the organization's senior monitoring suggesting that 'political' factors can have serious implications for a worldwide organisation.

Economic Factors: Financial factors such as the introduction of small companies in the worldwide situation recommend that Stock Options And Compensation is flourishing in an environment where there is potential growth of businesses. Fact that shop consumers are mainly looking for workplace materials for residence offices suggests that the market has a rising fad of business owners and residence based organisations.

Social factors: Social fads in the economic climate show that consumers are trying to find ease in addition to eye-catching prices. Marketing research demonstrates how the customer for Stock Options And Compensation does not have awareness regarding finding remedies which can provide a combination of benefit as well as low costs.

Technological factors: Modern technology plays a vital function in Stock Options And Compensation's company approach particularly as the organization is piloting Modern technology centers which would provide modern technology sales and assistance in the kind of memory upgrades, outer installments. (Summary of BUG in appendix 2).

OB Issues and Manifestations.

Numerous underlying Organizational Habits issues can be seen in Stock Options And Compensation's case as highlighted in this area.

Concerns regarding cultural modification: There is uneasiness regarding a social change that would certainly happen as soon as Todd Krasnow leaves from his placement as the Exec Vice President of Advertising with a lot of the personnel already revealing discontent over this possible action. This anticipated change has created stress and anxiety in the workplace which has been coupled with the previous tension of preparing the firm for a potential merger with House Deport.
Pest Analysis
Demanding Work Atmosphere for Newcomers: There is lack of employees that can match the demanding atmosphere of a fast-paced organization. Not only does this cause difficulty in finding the right people, it places anxiety on brand-new hires as can not withstand the pace as well as stress that the organization anticipates them to birth.

Dual Reporting Lines: Novices locate this organizational society troublesome and hard to cope with specifically as populated line relationships are indicated to be weak generally and unbiased setting and performance assessment is still done by the solid line supervisor. This indicates that newcomers could lose quality concerning their particular duties and objectives particularly as dotted line reporting does not maintain them in straight interaction with the strong line managers.

Resentment From Cross Departmental Hiring: Krasnow's choice to make Lewis his successor as opposed to Bridget Coles despite the fact that it had actually been guessed that the latter would certainly take Krasnow's placement came as a strike to her morale. Lewis may have been capable and appropriate for the work yet the reality that Kransnow's departure would make Coles a direct report to Lewis might have been the factor for Coles' resignation from solutions.

Concern & Task Instability: Concern as well as instability can be recognized as 2 major problems that Lewis would certainly be handling especially as the merger has actually currently be terminated and also two senior execs of the advertising and marketing division would certainly 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 but would additionally need to verify herself in her new duty.

Inappropriate Monitoring Design of Leader: Lewis's monitoring design and its conflict with the advertising and marketing department's role can additionally be seen as an OB obstacle specifically as she has actually been used to dealing with issues in the procedures department where workers are educated to concentrate on processes as well as obtain them. The marketing division on the various other hand can be seen as a team of people that are utilized to being supported by Krasnow who focused more on result than procedures.

Interdepartmental Disagreements: Interdepartmental disputes in between 3 divisions, marketing, merchandizing and procedures specifically over the allocation of the marketing mix can be determined as another OB concern. The marketing division does not share the very same vision as the other two departments pertaining to the aloocation of the advertising and marketing mix twoards promotions as well as advertsing, the merchandizing and procedures departments do not concur over the advertising mix appropriation among one an additional either.

Fragmentation in Advertising Department: Fragmentation between the marketing and advertising divisions can be recognized as one more OB problem which might need more focus. The reality that the marketing and advertising sections in the marketing division are separated is protecting against both departments from acquiring from each various other's experience and also competence. Combination of advertising with merchandising and also procedures would become more difficult if the advertising and marketing division itself is degenerated which can be another prospective OB concern.

Stock Options And Compensation Analysis

Numerous theories have actually been utilized to describe the circumstances to get more clearness about the situation available.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, a lot of supervisors believe that subordinates are passive and careless, have little passion as well as withstand adjustment. The scenario at Stock Options And Compensation is not entirely complying with Concept X, it can be seen that brand-new hires are finding this setting instead stressful which may ultimately lead to a better inclination of the management towards Concept X. Even while assessing Lewis's management style, theory X might have been appropriate in the procedures division to some level yet the Advertising and marketing division would need dependence on Theory Y in order to get the creativity and creativity from the groups.

Tuckman's Teamwork Concept: Regarding Lewis's issue regarding bringing consistency in between the marketing and advertising division is worried, this would initially bring about contrast as gone over by Bruce Tuckman in his 'Synergy Concept'. (Tuckman, 1965). According to Tuckman's theory shown in appendix 3, during the preliminary phase of group development, people may not bond, as they are active locating their area in the team. By combining the advertising and marketing division's job, there may be the same first separate which could bring about the 2nd phase of 'storming' where the teams challenge one another. Nonetheless, it is only during the third phase or 'norming' when they would certainly come together to share concepts prior to the group can bring about synergy in the 4th phase 'carrying out'.

Bridges' Shift Design: Based On William Bridge's concept (appendix 4), individuals are rather unpleasant with change, which is obvious by the circumstance at Stock Options And Compensation The situation can be viewed as a regular course of life if is studied based on Bridge's theory where he clarifies that people undergo 3 stages of change when they experience modification. 'Ending, shedding and also Letting go', The Neutral Area as well as 'The New Starting' (Bridges, 2004). When people exist with modification, they get in stage one therefore there might be emotions like unhappiness, uncertainty, frustration, anger, worry, denial and disorientation.The situation at the advertising and marketing department of Stock Options And Compensation is similar so Lewis can get comfortable with the concept that it is not remarkable actions. In the 2nd stage, there may be a requirement to link the void in between the new and old society so Lewis may need to encounter this challenge as soon as Krasnow leaves. There might be reduced spirits and reduced productivity at this stage which must not be taken as an obstacle. It is during this phase that Lewis will need to give advice to the division to ensure that they can discover an orientation. It can be seen how Krasnow has already made this change easier by making Lewis obtain involved in the department a year prior to his real separation. As per Bridges' Model, phase three will cause visibility to learning, High energy as well as dedication as people will embrace the change (Bridges, 2004).
Vrio Analysis
Maslow's Need pecking order: The OB problem pertaining to insecurity at the office has been activated to start with by the adjustment in management and also secondly by the reality that the merging will certainly no more be started. Abraham Maslow in his Concept of 'Requirements Pecking order' (appendix 5) has goes over the relevance of 'protection needs as being a lower level need of a human for causing inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the demand to really feel secure and safe' goes to the 2nd degree of requirements. Before an employee can be made to create mentally, he requires to have his 'Physical 'as well as 'Safety' needs fulfilled. This shows that unless the personnel are made to feel secure regarding their current employment condition in Stock Options And Compensation they might not reach 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Stock Options And Compensation Case Study

Ramification of Analysis.

The OB analysis has checked out different concepts to comprehend how to deal with the current scenario at hand. The complying with three options have been recommended to aid Lewis take care of the organizational difficulties in the marketing department. Each of these options has actually been suggested for easing the shift required to bring the marketing division in line with the demands of the market as well as for making the social change that would certainly comply with as soon as the current leader leaves.

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

Assessment of Alternatives.

Judith Shapiro that has earlier been interviewed by Lewis throughout the earlier merging days has expertise in business-to-business advertising and marketing along with company and retail marketing experience. As soon as Krasnow leaves, Lewis can hire Shapiro as an EVP for marketing to handle both advertising as well as advertising and marketing functions.

The benefit of this approach is that it will certainly incorporate both functions while decreasing the need for working with an extra source for advertising. Lewis would certainly be heading the advertising and marketing division and also in any kind of case her replacement would certainly be required for the existing function that she is executing. The negative aspect of this choice is that external hiring might bring about bitterness from interior employees who may be looking at the placement of EVP after Lewis takes over Krasnow's position.

Separating Adverting as well as Production: Offered the competitive stress as well as high top quality job required from the advertising agency, it is advised that Lewis must permit the manufacturing unit to be a different feature from the advertising device. Given that most marketing agencies had these two functions as different units, it makes more sense to follow the standard.

Integration of Marketing with Procedures: Because Lewis is already taking care of the advertising and operations departments concurrently; it makes sense to incorporate both features considering that she has actually been effectively dealing with both ends. The truth that the two divisions already have significant distinctions over allowance of sources suggests that this combination might have the ability to cause consistency specifically as Lewis would be heading both ends.However there are various negative aspects of this move specifically as it would certainly place excessive problem over Lewis's shoulders. The reality that Lewis has to adapt her monitoring design for the advertising and marketing department recommends that these 2 departments would certainly be culturally varied. In addition to this, Lewis might not be able to use one sort of leadership style to both departments which could cause ineffectiveness in either one of the two features.


An evaluation of the three choices shows that combination of advertising and operations would certainly not be a possible action due to the large distinctions in between the two departments in spite of the truth that currently Lewis is taking care of both. While splitting up of the production function may have been a positive relocation for the marketing department, the reality that it would certainly indicate placing a 3rd function under Lewis's wing suggests this should be avoided.

Action Strategy.
Lewis will take control of the duty of EVP Advertising and marketing after Krasnow leaves.

Marketing and advertising features would be merged.

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

Manufacturing function will stay component of advertising and marketing under advertising and marketing function.

Lewis will divide herself from operations.

A democratic leadership style with staff member empowerment will be made use of in advertising and marketing department.

Open up door plan as well as focus on cross departmental communication will be focused on eliminating disharmony.

Backup strategy.

If the combination does not work out as planned, a contingency strategy would follow which would certainly divide the manufacturing feature from the advertising and marketing feature to lower the lots on the SVP of marketing and advertising. In case Judith Shapiro does not obtain worked with, Lewis will be heading the advertising division without an SVP. Because case the manufacturing feature will absolutely be separated by positioning it under an SVP production.