The Solow Model Unleashed Understanding Economic Growth Case Study Help


Home >> Harvard >> The Solow Model Unleashed Understanding Economic Growth >>

The Solow Model Unleashed Understanding Economic Growth Case Study Solution

Background and Facts

The Solow Model Unleashed Understanding Economic Growth a workplace supplies retailer for little and medium sized companies has lately been involved in preparing for a merging with its competitor Residence Deport, which has impacted efficiency levels in departmentswith the senior supervisor involved in lawful complications presented by the federal Trade Payment. With the Advertising and marketing Head advancing the news of his separation from the company in one year, Jeannie Lewis, the present head of procedures has actually been asked to take the function in the near future. With difficulties in the type of a potential social change and reduced staff member morale, the company requires a full reengineering initiative at the advertising and marketing division.

Issue Statement
Porter's 5 Forces Analysis
The potential social modification at the advertising division of The Solow Model Unleashed Understanding Economic Growth is raising uncertainty in the workplace causing numerous difficulties for the Jeannie Lewis that would certainly be replacing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant function in impacting tactical choices because Stapes Inc. had to abandon its plans of combining with Office Deport after the Federal Profession Commission's intervention in the process. Offered the truth that the shop has an international existence with branches in UK, USA, Canada and also Germany, political factors in each of these nations may be able to impact efficiency or calculated goals. Federal Profession Compensation's antitrust fit versus the merger occupied beneficial time of the company's elderly monitoring recommending that 'political' factors can have major implications for a worldwide business.

Economic Factors: Economic factors such as the appearance of local business in the international scenario suggest that The Solow Model Unleashed Understanding Economic Growth is flourishing in an environment where there is potential development of companies. Along with this, reality that shop customers are primarily searching for workplace supplies for office suggests that the marketplace has an increasing pattern of entrepreneurs and also home based companies.

Social factors: Social fads in the economic situation reveal that clients are seeking comfort along with appealing prices. Marketing research demonstrates how the customer for The Solow Model Unleashed Understanding Economic Growth lacks awareness about finding services which can supply a combination of ease and also inexpensive.

Technical factors: Innovation plays an essential function in The Solow Model Unleashed Understanding Economic Growth's company approach particularly as the organization is piloting Technology centers which would use technology sales as well as assistance in the form of memory upgrades, outer installations. (Recap of PARASITE in appendix 2).

OB Issues and Effects.

Several underlying Organizational Actions issues can be seen in The Solow Model Unleashed Understanding Economic Growth's case as highlighted in this section.

Worries about social change: There is worry about a cultural change that would certainly take place when Todd Krasnow leaves from his position as the Exec Vice President of Marketing with most of the staff members already revealing discontent over this prospective move. This predicted change has produced stress in the workplace which has been coupled with the past tension of preparing the company for a possible merging with House Deport.
Pest Analysis
Demanding Job Environment for Newcomers: There is shortage of personnel that can match the demanding atmosphere of a busy company. Not only does this cause trouble in finding the appropriate people, it puts stress on new hires as can not withstand the speed and also pressure that the company anticipates them to bear.

Twin Coverage Lines: Beginners locate this business society cumbersome as well as hard to deal with specifically as dotted line connections are implied to be weak generally and also objective setup as well as performance assessment is still done by the solid line manager. This suggests that newbies might lose clarity concerning their corresponding functions and also objectives particularly as populated line reporting does not maintain them in straight communication with the solid line managers.

Resentment 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 latter would take Krasnow's placement came as a blow to her morale. Lewis may have been qualified and ideal for the job but the reality that Kransnow's separation would certainly make Coles a direct report to Lewis may have been the factor for Coles' resignation from solutions.

Anxiety & Work Instability: Anxiety and also insecurity can be identified as 2 major worries that Lewis would certainly be handling particularly as the merger has actually currently be terminated as well as 2 senior executives of the advertising and marketing division would be leaving. The whole responsibility of the department would certainly be falling on Lewis's shoulders that would certainly not simply be in charge of brining about a social modification yet would certainly likewise need to show herself in her new duty.

Incompatible Management Style of Leader: Lewis's administration style as well as its incompatibility with the marketing department's role can additionally be seen as an OB obstacle particularly as she has actually been utilized to managing issues in the operations division where workers are educated to concentrate on procedures and also get them. The marketing department on the various other hand can be seen as a team of people that are used to being supported by Krasnow who focused extra on outcome than processes.

Interdepartmental Disputes: Interdepartmental arguments between three divisions, advertising and marketing, merchandizing as well as procedures respectively over the appropriation of the marketing mix can be identified as another OB issue. The marketing department does not share the same vision as the various other 2 divisions regarding the aloocation of the advertising and marketing mix twoards promos as well as advertsing, the merchandizing as well as procedures divisions do not concur over the advertising mix allotment amongst one an additional either.

Disintegration in Advertising And Marketing Department: Disintegration between the marketing and advertising divisions can be determined as one more OB concern which can require further interest. The truth that the marketing and advertising areas in the marketing division are disconnected is preventing both departments from obtaining from each other's experience as well as knowledge. Combination of marketing with merchandising and also operations would certainly end up being more difficult if the advertising department itself is broken down which can be another prospective OB problem.

The Solow Model Unleashed Understanding Economic Growth Analysis

Numerous theories have actually been used to discuss the scenarios to obtain further quality regarding the circumstance available.
Swot Analysis
McGregor's Concept X & Y: According to Douglas McGregor's Theory X, a lot of managers think that staffs are passive and also careless, have little passion as well as resist modification. The scenario at The Solow Model Unleashed Understanding Economic Growth is not completely adhering to Concept X, it can be seen that brand-new hires are locating this atmosphere instead difficult which might at some point lead to a better disposition of the monitoring in the direction of Theory X. Also while evaluating Lewis's administration design, theory X may have been appropriate in the procedures department to some degree yet the Advertising division would require reliance on Theory Y in order to obtain the creative thinking and also creativity from the groups.

Tuckman's Synergy Concept: As much as Lewis's concern concerning bringing harmony between the advertising as well as advertising department is worried, this would initially lead to contrast as discussed by Bruce Tuckman in his 'Team effort Theory'. By integrating the advertising and marketing and advertising and marketing department's job, there might be the same first detach which could lead to the 2nd phase of 'storming' where the teams test one another.

When individuals are presented with modification, they go into stage one and so there might be feelings like unhappiness, uncertainty, aggravation, rage, concern, rejection as well as disorientation.The situation at the advertising department of The Solow Model Unleashed Understanding Economic Growth is similar so Lewis can obtain comfortable with the concept that it is not phenomenal behavior. It is throughout this phase that Lewis will certainly have to provide assistance to the department so that they can locate a feeling of instructions. It can be seen just how Krasnow has actually currently made this shift less complicated by making Lewis get entailed in the department a year prior to his real departure.
Vrio Analysis
Abraham Maslow in his Theory of 'Demands Pecking order' (appendix 5) has talks about the relevance of 'safety and security needs as being a reduced degree demand of a human for setting off inspiration. As seen in the pyramid shared in appendix 3, we can see just how 'the requirement to really feel safe and secure and out of danger' is at the 2nd level of needs. Prior to a worker can be made to establish mentally, he needs to have his 'Physical 'and 'Safety' needs satisfied.

SWOT Analysis for The Solow Model Unleashed Understanding Economic Growth Case Study

Implication of Analysis.

The OB analysis has actually considered numerous concepts to comprehend how to cope with the existing circumstance handy. The complying with three choices have been recommended to assist Lewis deal with the organizational difficulties in the marketing department. Each of these choices has actually been suggested for reducing the change needed to bring the advertising and marketing division according to the requirements of the market as well as for making the social change that would adhere to when the present leader leaves.

Combination of advertising and marketing features. Separating Adverting and Manufacturing features. Assimilation of Advertising And Marketing with Workflow.

Evaluation of Alternatives.

Assimilation of Advertising And Marketing & Advertising Functions: The internal advertising firm of The Solow Model Unleashed Understanding Economic Growth is currently strength for the company in regards to conserving up on overheads related to marketing and promotion. Given that no brand-new recruitment has actually been done after Bridget Cole's departure with the reporting line being directly assigned to Krasnow for the advertising function, this is a beneficial opportunity for integrating the marketing and advertising functions. Judith Shapiro who has actually earlier been interviewed by Lewis throughout the earlier merging days has know-how in business-to-business advertising and marketing in addition to company as well as retail marketing experience. As soon as Krasnow leaves, Lewis can work with Shapiro as an EVP for advertising and marketing to deal with both advertising and marketing functions.

The benefit of this method is that it will integrate the two functions while reducing the demand for hiring an extra source for advertising. Along with this, Lewis would be heading the advertising division and regardless her replacement would certainly be needed for the existing function that she is performing. The drawback of this option is that external hiring may cause bitterness from internal employees that may be eying the setting of EVP after Lewis takes control of Krasnow's setting.

Dividing Adverting and also Production: Given the affordable pressures as well as high top quality work called for from the marketing company, it is recommended that Lewis needs to allow the production device to be a separate feature from the advertising system. Considering that the majority of advertising companies had these 2 functions as separate devices, it makes even more feeling to comply with the norm.

Assimilation of Marketing with Procedures: Since Lewis is already taking care of the marketing as well as operations departments at the same time; it makes good sense to integrate both functions since she has been efficiently taking care of both ends. The reality that the two divisions currently have significant distinctions over allowance of sources recommends that this integration may be able to bring about consistency specifically as Lewis would be heading both ends.However there are different disadvantages of this action particularly as it would certainly place too much problem over Lewis's shoulders. The fact that Lewis has to adjust her administration design for the marketing division recommends that these 2 divisions would certainly be culturally diverse. Along with this, Lewis might not have the ability to apply one kind of management design to both departments which might result in inefficiency in either one of both functions.


An analysis of the three options suggests that assimilation of advertising and marketing and operations would not be a viable action due to the large distinctions in between the two divisions in spite of the fact that presently Lewis is handling both. While splitting up of the manufacturing feature might have been a positive action for the advertising and marketing department, the truth that it would indicate placing a 3rd function under Lewis's wing implies this must be stayed clear of.

Activity Plan.
Lewis will certainly take control of the role of EVP Advertising after Krasnow leaves.

Advertising and Marketing features would certainly be combined.

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

Production function will certainly continue to be component of advertising under marketing feature.

Lewis will certainly divide herself from operations.

An autonomous leadership design with worker empowerment will certainly be used in advertising department.

Open up door plan as well as focus on cross departmental communication will be aimed at removing dissonance.

Contingency plan.

If the combination does not work out as planned, a backup strategy would certainly follow which would separate the production feature from the advertising function to decrease the load on the SVP of advertising and marketing. In case Judith Shapiro does not get employed, Lewis will certainly be heading the marketing department without an SVP. Because case the manufacturing function will definitely be divided by positioning it under an SVP production.