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The Kashagan Production Sharing Agreement Psa Case Study Analysis

Background and Facts

The Kashagan Production Sharing Agreement Psa an office materials seller for tiny and average sized businesses has actually lately been associated with planning for a merging with its rival Home Deport, which has actually affected performance degrees in departmentswith the elderly supervisor involved in lawful difficulties put forth by the federal Profession Payment. With the Advertising Head putting forward the news of his separation from the firm in one year, Jeannie Lewis, the present head of procedures has been asked to take the duty in the near future. With difficulties in the form of a prospective cultural modification and also low staff member spirits, the organization requires a complete reengineering initiative at the advertising and marketing department.

Issue Declaration
Porter's 5 Forces Analysis
The possible social change at the advertising division of The Kashagan Production Sharing Agreement Psa is enhancing unpredictability in the working environment leading to different obstacles for the Jeannie Lewis that would certainly be changing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant duty in affecting calculated decisions because Stapes Inc. needed to abandon its plans of combining with Office Deport after the Federal Profession Commission's intervention while doing so. Given the reality that the shop has an international presence with branches in UK, USA, Canada and Germany, political consider each of these countries might be able to impact performance or tactical goals. Federal Trade Compensation's antitrust match versus the merger used up important time of the company's elderly administration recommending that 'political' factors can have severe implications for a global organisation.

Economic Factors: Financial factors such as the emergence of small companies in the worldwide circumstance recommend that The Kashagan Production Sharing Agreement Psa is growing in a setting where there is prospective growth of businesses. Truth that shop customers are mainly looking for office materials for home workplaces suggests that the market has a rising trend of business owners as well as house based services.

Social factors: Social patterns in the economic climate reveal that customers are searching for convenience in addition to appealing rates. Marketing research shows how the consumer for The Kashagan Production Sharing Agreement Psa lacks recognition about discovering solutions which can provide a combination of comfort and low costs.

Technical factors: Innovation plays an important role in The Kashagan Production Sharing Agreement Psa's business method especially as the company is piloting Innovation centers which would certainly supply technology sales as well as support in the type of memory upgrades, outer setups. (Recap of BUG in appendix 2).

OB Issues and also Effects.

A number of underlying Organizational Behavior issues can be seen in The Kashagan Production Sharing Agreement Psa's case as highlighted in this section.

Apprehensions concerning social change: There is apprehension regarding a social modification that would take place as soon as Todd Krasnow leaves from his setting as the Executive Vice President of Advertising And Marketing with most of the employee currently revealing unhappiness over this prospective move. This anticipated change has produced tension in the workplace which has actually been combined with the past stress of preparing the company for a potential merger with Home Deport.
Pest Analysis
Stressful Task Setting for Newcomers: There is shortage of workers that can match the demanding setting of a hectic organization. Not only does this lead to trouble in finding the ideal people, it puts anxiety on brand-new hires as can not withstand the speed and pressure that the organization anticipates them to birth.

Twin Coverage Lines: Newcomers find this business society difficult as well as difficult to manage particularly as dotted line relationships are implied to be weak generally and objective setting and also efficiency evaluation is still done by the solid line supervisor. This suggests that novices might lose clarity concerning their respective roles and also objectives especially as dotted line reporting does not maintain them in direct interaction with the strong line managers.

Animosity From Cross Departmental Hiring: Krasnow's choice to make Lewis his follower as opposed to Bridget Coles although it had been hypothesized that the latter would certainly take Krasnow's position came as a strike to her spirits. Lewis may have been capable and proper for the task but the fact that Kransnow's departure would certainly make Coles a direct report to Lewis may have been the reason for Coles' resignation from services.

Concern & Job Insecurity: Fear and insecurity can be determined as two significant concerns that Lewis would certainly be dealing with specifically as the merging has now be terminated as well as 2 senior execs of the advertising division would be leaving. The whole obligation of the division would be falling on Lewis's shoulders who would not just be in charge of brining concerning a social change however would also have to confirm herself in her new role.

Inappropriate Monitoring Style of Leader: Lewis's administration design and its conflict with the advertising department's role can additionally be seen as an OB difficulty specifically as she has actually been used to managing issues in the operations department where workers are shown to concentrate on processes as well as get them right. The advertising department on the other hand can be viewed as a team of individuals who are made use of to being nurtured by Krasnow who concentrated more on result than processes.

Interdepartmental Disagreements: Interdepartmental disagreements between three departments, marketing, merchandizing and also procedures respectively over the allocation of the marketing mix can be determined as one more OB issue. Although the advertising department does not share the exact same vision as the other two departments relating to the aloocation of the advertising and marketing mix twoards promos as well as advertsing, the merchandizing as well as operations departments do not concur over the advertising and marketing mix allotment among one another either.

Disintegration in Advertising And Marketing Division: Fragmentation between the advertising and marketing departments can be identified as another OB concern which might require more interest. The reality that the advertising and marketing sections in the marketing division are separated is avoiding both divisions from getting from each various other's experience as well as knowledge. Combination of advertising and marketing with retailing and operations would become more difficult if the advertising and marketing department itself is broken down which can be an additional possible OB worry.

The Kashagan Production Sharing Agreement Psa Analysis

Different theories have actually been utilized to clarify the situations to obtain more clearness regarding the scenario at hand.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, most supervisors believe that staffs are easy and also lazy, have little aspiration and also stand up to change. The scenario at The Kashagan Production Sharing Agreement Psa is not totally following Concept X, it can be seen that new hires are discovering this environment instead stressful which might eventually lead to a better inclination of the monitoring towards Concept X. Even while evaluating Lewis's management style, concept X may have been suitable in the operations division to some degree yet the Marketing department would certainly need dependence on Concept Y in order to get the imagination and also creativity from the teams.

Tuckman's Synergy Concept: Regarding Lewis's concern concerning bringing harmony in between the advertising and marketing department is worried, this would originally bring about clash as reviewed by Bruce Tuckman in his 'Team effort Concept'. (Tuckman, 1965). As per Tuckman's concept received appendix 3, throughout the initial stage of group development, people may not bond, as they are active finding their location in the group. By integrating the marketing and advertising department's job, there may be the same initial detach which can cause the second phase of 'storming' where the teams test each other. It is only throughout the 3rd phase or 'norming' when they would certainly come with each other to share suggestions prior to the group can bring around harmony in the fourth stage 'executing'.

Bridges' Shift Version: According To William Bridge's theory (appendix 4), people are quite awkward with modification, which is noticeable by the circumstance at The Kashagan Production Sharing Agreement Psa The scenario can be seen as a regular course of life if is researched as per Bridge's concept where he discusses that people experience 3 stages of transition when they experience change. 'End, shedding and Releasing', The Neutral Zone as well as 'The New Starting' (Bridges, 2004). When individuals exist with modification, they get in stage one therefore there might be emotions like despair, unpredictability, aggravation, rage, fear, denial as well as disorientation.The scenario at the advertising and marketing division of The Kashagan Production Sharing Agreement Psa is similar so Lewis can get comfy with the concept that it is not phenomenal behavior. In the 2nd stage, there may be a demand to bridge the void in between the brand-new as well as old culture so Lewis might have to encounter this experience as soon as Krasnow leaves. There may be low spirits and reduced performance at this stage which should not be taken as a setback. It is throughout this stage that Lewis will certainly have to give support to the division to make sure that they can discover an orientation. It can be seen exactly how Krasnow has currently made this shift less complicated by making Lewis obtain associated with the division a year prior to his real separation. As per Bridges' Version, stage three will certainly bring about openness to learning, High energy and also commitment as people will certainly welcome the adjustment (Bridges, 2004).
Vrio Analysis
Abraham Maslow in his Concept of 'Needs Pecking order' (appendix 5) has reviews the value of 'protection requires as being a reduced level requirement of a human for setting off inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the requirement to feel secure and out of danger' is at the 2nd degree of demands. Prior to a staff member can be made to establish emotionally, he needs to have his 'Physical 'and also 'Safety and security' requires fulfilled.

SWOT Analysis for The Kashagan Production Sharing Agreement Psa Case Study

Ramification of Analysis.

The OB analysis has actually checked out different theories to comprehend exactly how to cope with the present scenario at hand. The adhering to 3 options have been suggested to aid Lewis take care of the organizational obstacles in the marketing department. Each of these choices has been proposed for easing the change needed to bring the marketing division in accordance with the requirements of the market and also for making the cultural change that would comply with when the existing leader leaves.

Assimilation of advertising and marketing functions. Separating Adverting as well as Manufacturing functions. Assimilation of Advertising with Workflow.

Evaluation of Alternatives.

Integration of Advertising And Marketing & Advertising Functions: The internal advertising firm of The Kashagan Production Sharing Agreement Psa is already strength for the company in regards to conserving up on expenses related to marketing and also promo. Considering that no brand-new employment has been done after Bridget Cole's separation with the coverage line being directly assigned to Krasnow for the advertising and marketing feature, this is a beneficial possibility for incorporating the marketing and advertising features. Judith Shapiro who has actually earlier been talked to by Lewis during the earlier merging days has knowledge in business-to-business advertising along with company and retail advertising and marketing experience. When Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to handle both advertising and marketing features.

The benefit of this method is that it will incorporate both functions while decreasing the demand for hiring an added resource for marketing. Lewis would be heading the advertising and marketing division as well as in any case her substitute would certainly be needed for the present duty that she is doing. The negative aspect of this choice is that exterior hiring may cause bitterness from internal personnel who may be considering the placement of EVP after Lewis takes over Krasnow's placement.

Separating Adverting as well as Production: Provided the competitive stress as well as excellent quality job needed from the advertising agency, it is advised that Lewis must allow the manufacturing device to be a different function from the advertising system. Since the majority of advertising agencies had these 2 features as separate systems, it makes even more feeling to adhere to the standard. Along with this, both features may have the ability to concentrate on their core triggers extra effectively. However, the negative aspect of this strategy would be that added expenses would certainly have to be birthed for establishing different manufacturing features. Along with this, a manufacturing head might need to be hired which could raise expenses for the organization.

Assimilation of Marketing with Operations: Because Lewis is already taking treatment of the advertising and marketing and also procedures departments simultaneously; it makes sense to integrate the two functions since she has been successfully taking care of both ends. The reality that Lewis has to adapt her administration style for the marketing department suggests that these two divisions would be culturally diverse.


An assessment of the 3 options suggests that integration of marketing and also procedures would certainly not be a possible move due to the huge distinctions between the two divisions although that presently Lewis is handling both. While splitting up of the production feature may have been a positive step for the advertising and marketing department, the truth that it would indicate putting a third function under Lewis's wing implies this must be avoided as well. The assimilation of the advertising and marketing department is the most effective option in regards to getting the optimum arise from the division. An action prepare for this option is talked about listed below.

Action Plan.
Lewis will certainly take control of the function of EVP Marketing after Krasnow leaves.

Advertising and Marketing functions would certainly be combined.

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

Production feature will continue to be component of advertising under advertising feature.

Lewis will certainly divide herself from operations.

A democratic management design with worker empowerment will certainly be made use of in advertising and marketing department.

Open door plan as well as focus on cross departmental interaction will certainly be targeted at eliminating disharmony.

Backup plan.

If the assimilation does not work out as prepared, a backup plan would adhere to which would certainly divide the manufacturing feature from the advertising feature to reduce the lots on the SVP of marketing and advertising. In case Judith Shapiro does not obtain worked with, Lewis will certainly be heading the advertising and marketing department without an SVP. Because case the production function will most definitely be separated by placing it under an SVP production.