Taxing Situations Two Cases On Income Taxes And Financial Reporting Case Study Analysis


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Taxing Situations Two Cases On Income Taxes And Financial Reporting Case Study Solution

Background and Facts

Taxing Situations Two Cases On Income Taxes And Financial Reporting a workplace products store for small as well as medium sized businesses has lately been involved in preparing for a merging with its competitor Residence Deport, which has actually impacted efficiency degrees in departmentswith the senior supervisor associated with lawful difficulties presented by the government Profession Compensation. With the Marketing Head advancing the information of his separation from the company in one year, Jeannie Lewis, the present head of operations has been asked to take the function in the future. With challenges in the kind of a prospective social modification and also low employee morale, the organization wants a total reengineering initiative at the marketing division.

Trouble Statement
Porter's 5 Forces Analysis
The potential cultural adjustment at the marketing division of Taxing Situations Two Cases On Income Taxes And Financial Reporting is enhancing uncertainty in the working environment causing numerous challenges for the Jeannie Lewis who would certainly be changing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant duty in influencing strategic decisions because Stapes Inc. had to desert its strategies of merging with Office Deport after the Federal Trade Commission's intervention in the process. Given the fact that the shop has an international existence with branches in UK, U.S.A., Canada and also Germany, political consider each of these nations might be able to affect efficiency or calculated goals. Federal Trade Payment's antitrust match versus the merging took up beneficial time of the company's senior monitoring recommending that 'political' factors can have serious implications for a global company.

Economic Factors: Financial factors such as the introduction of small businesses in the worldwide scenario recommend that Taxing Situations Two Cases On Income Taxes And Financial Reporting is thriving in an atmosphere where there is potential growth of services. Truth that shop consumers are primarily looking for workplace materials for home workplaces recommends that the market has an increasing pattern of entrepreneurs and residence based companies.

Social factors: Social patterns in the economic situation show that customers are looking for benefit as well as appealing prices. Marketing research demonstrates how the client for Taxing Situations Two Cases On Income Taxes And Financial Reporting lacks understanding regarding discovering options which can provide a combination of ease and also low costs.

Technical factors: Innovation plays an essential duty in Taxing Situations Two Cases On Income Taxes And Financial Reporting's organisation strategy particularly as the company is piloting Technology facilities which would provide modern technology sales and also support in the kind of memory upgrades, peripheral setups. (Summary of PEST in appendix 2).

OB Issues and also Symptoms.

Several underlying Business Habits concerns can be seen in Taxing Situations Two Cases On Income Taxes And Financial Reporting's case as highlighted in this area.

Worries concerning social adjustment: There is apprehension concerning a cultural adjustment that would certainly occur as soon as Todd Krasnow leaves from his placement as the Exec Vice President of Marketing with most of the personnel currently revealing discontent over this prospective action. This anticipated adjustment has developed stress in the work environment which has actually been combined with the past anxiety of preparing the company for a possible merger with Residence Deport.
Pest Analysis
Stressful Work Atmosphere for Newcomers: There is shortage of workers that can match the stressful environment of a busy organization. Not only does this cause trouble in discovering the right individuals, it places tension on brand-new hires as can not withstand the rate as well as pressure that the organization expects them to bear.

Dual Reporting Lines: Newbies find this organizational culture difficult and challenging to handle especially as dotted line relationships are meant to be weaker as a whole and also objective setup and performance assessment is still done by the solid line manager. This means that newbies might shed clarity regarding their corresponding duties and goals especially as dotted 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 despite the fact that it had actually been hypothesized that the last would certainly take Krasnow's placement came as an impact to her morale. Lewis might have been qualified and appropriate for the job yet the fact that Kransnow's separation would certainly make Coles a straight report to Lewis may have been the reason for Coles' resignation from services.

Worry & Work Insecurity: Worry as well as instability can be determined as 2 significant concerns that Lewis would certainly be managing specifically as the merger has currently be cancelled and two senior execs of the advertising division would be leaving. The entire responsibility of the department would be falling on Lewis's shoulders who would not simply be in charge of brining concerning a cultural change however would additionally need to verify herself in her brand-new function.

Incompatible Management Design of Leader: Lewis's monitoring style as well as its incompatibility with the advertising department's role can additionally be viewed as an OB obstacle especially as she has actually been used to dealing with issues in the procedures division where personnel are shown to focus on procedures as well as get them right. The advertising and marketing department on the various other hand can be viewed as a team of people that are used to being supported by Krasnow that concentrated much more on result than procedures.

Interdepartmental Disputes: Interdepartmental disagreements in between three divisions, advertising, merchandizing as well as operations respectively over the appropriation of the advertising mix can be determined as an additional OB concern. The advertising division does not share the very same vision as the various other 2 divisions relating to the aloocation of the advertising and marketing mix twoards promos and advertsing, the merchandizing and also procedures divisions do not concur over the advertising mix allotment amongst one another either.

Disintegration in Advertising Department: Fragmentation in between the marketing and advertising departments can be determined as another OB concern which could require additional focus. The truth that the advertising and marketing sections in the advertising department are separated is protecting against both divisions from acquiring from each other's experience and also proficiency. Assimilation of advertising and marketing with retailing as well as procedures would certainly become more difficult if the advertising department itself is degenerated which can be another prospective OB issue.

Taxing Situations Two Cases On Income Taxes And Financial Reporting Analysis

Numerous concepts have actually been used to clarify the situations to get additional quality about the scenario at hand.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Concept X, the majority of managers think that staffs are easy and lazy, have little aspiration and also stand up to adjustment. The tough version of this theory emphasized browbeating, tight controls, hazards as well as penalties. In time it produces low productivity, refined sabotage as well as rivalry (Bargain, 2003). The scenario at Taxing Situations Two Cases On Income Taxes And Financial Reporting is not totally adhering to Concept X, it can be seen that new hires are locating this environment rather difficult which may at some point lead to a higher disposition of the monitoring towards Concept X. As per McGregor's promoted sight, which he called Concept Y, the crucial task of the monitoring is to arrange organizational problems so that individuals can attain their very own objectives best by routing their initiatives in the direction of organizational rewards. If individuals discover no complete satisfaction in their job, the monitoring would certainly have little choice however to depend on concept X as well as external control (Bargain, 2003). Even while evaluating Lewis's monitoring design, concept X might have appropriated in the procedures division to some extent but the Advertising and marketing division would require reliance on Theory Y to get the creativity and also creativity from the teams.

Tuckman's Teamwork Concept: Regarding Lewis's worry about bringing consistency between the advertising and marketing division is worried, this would at first cause clash as discussed by Bruce Tuckman in his 'Synergy Concept'. (Tuckman, 1965). Based on Tuckman's concept received appendix 3, throughout the preliminary stage of group growth, people might not bond, as they are hectic locating their place in the team. By combining the marketing and advertising department's work, there might be the same first detach which could lead to the 2nd stage of 'storming' where the groups test each other. It is just during the third stage or 'norming' when they would come together to share suggestions prior to the team can bring around harmony in the 4th stage 'doing'.

When individuals are offered with modification, they enter stage one and so there might be emotions like unhappiness, uncertainty, stress, anger, fear, denial as well as disorientation.The circumstance at the advertising department of Taxing Situations Two Cases On Income Taxes And Financial Reporting is comparable so Lewis can get comfortable with the concept that it is not phenomenal behavior. It is throughout this stage that Lewis will certainly have to offer guidance to the department so that they can discover a feeling of instructions. It can be seen just how Krasnow has currently made this shift easier by making Lewis obtain involved in the department a year before his real separation.
Vrio Analysis
Abraham Maslow in his Concept of 'Needs Power structure' (appendix 5) has reviews the relevance of 'safety needs as being a lower level demand of a human for activating motivation. As seen in the pyramid shared in appendix 3, we can see exactly how 'the need to really feel safe and out of threat' is at the second degree of demands. Before a staff member can be made to establish emotionally, he requires to have his 'Physical 'as well as 'Security' needs satisfied.

SWOT Analysis for Taxing Situations Two Cases On Income Taxes And Financial Reporting Case Study

Ramification of Analysis.

The OB analysis has actually checked out various concepts to recognize exactly how to manage the present scenario available. The adhering to 3 options have been recommended to aid Lewis take care of the organizational difficulties in the advertising division. Each of these alternatives has actually been suggested for alleviating the transition required to bring the advertising and marketing department in line with the demands of the market as well as for making the social modification that would follow as soon as the current leader leaves.

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

Evaluation of Alternatives.

Combination of Marketing & Marketing Functions: The internal advertising company of Taxing Situations Two Cases On Income Taxes And Financial Reporting is currently strength for the organization in regards to conserving up on overheads associated with marketing as well as promo. Given that no new recruitment has been done after Bridget Cole's departure with the coverage line being straight designated to Krasnow for the advertising and marketing function, this is a favorable possibility for incorporating the marketing and advertising functions. Judith Shapiro who has actually earlier been spoken with by Lewis during the earlier merger days has know-how in business-to-business marketing along with company as well as retail advertising and marketing experience. When Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to manage both marketing and advertising features.

The advantage of this strategy is that it will certainly integrate both functions while lowering the demand for employing an added source for advertising and marketing. Lewis would certainly be heading the advertising and marketing department and also in any type of case her substitute would certainly be needed for the current duty that she is carrying out. The drawback of this choice is that exterior hiring might cause animosity from interior employees who might be eying the placement of EVP after Lewis takes control of Krasnow's placement.

Dividing Adverting as well as Production: Provided the affordable stress and also high quality job required from the advertising company, it is recommended that Lewis must allow the production device to be a different feature from the marketing device. Because a lot of advertising and marketing agencies had these two features as different devices, it makes more feeling to comply with the norm.

Combination of Advertising And Marketing with Procedures: Considering that Lewis is already taking care of the marketing as well as procedures departments all at once; it makes sense to incorporate both features considering that she has actually been successfully taking care of both ends. The fact that both departments already have significant distinctions over allowance of resources suggests that this assimilation may be able to bring about harmony specifically as Lewis would certainly be heading both ends.However there are various disadvantages of this relocation particularly as it would certainly place too much worry over Lewis's shoulders. The truth that Lewis has to adapt her administration design for the marketing division suggests that these two divisions would be culturally diverse. Lewis may not be able to apply one kind of leadership design to both departments which might result in inadequacy in either one of the 2 functions.


An assessment of the 3 options suggests that assimilation of marketing as well as procedures would certainly not be a practical relocation because of the vast distinctions between both departments although that currently Lewis is managing both. While splitting up of the production function might have been a positive relocation for the advertising and marketing department, the reality that it would mean positioning a third feature under Lewis's wing implies this need to be avoided too. The integration of the marketing department is the very best choice in terms of obtaining the optimal results from the department. An activity plan for this choice is talked about below.

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

Marketing and advertising features would certainly be merged.

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

Production function will remain part of advertising under marketing function.

Lewis will certainly separate herself from procedures.

A democratic leadership style with worker empowerment will be utilized in advertising department.

Open up door policy and also focus on cross department interaction will be focused on eliminating disharmony.

Contingency plan.

If the assimilation does not work out as planned, a contingency plan would certainly follow which would separate the production feature from the advertising and marketing function to decrease the tons on the SVP of marketing and advertising. In case Judith Shapiro does not obtain employed, Lewis will certainly be heading the advertising division without an SVP. In that case the production feature will definitely be separated by placing it under an SVP production.