Three Year Planning At Li And Fung Limited Case Study Solution


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Three Year Planning At Li And Fung Limited Case Study Solution

Background and Facts

Three Year Planning At Li And Fung Limited a workplace materials retailer for little as well as moderate sized services has actually recently been involved in planning for a merging with its rival House Deport, which has influenced efficiency degrees in departmentswith the senior manager involved in lawful issues put forth by the government Trade Payment. With the Advertising Head putting forward the information of his departure from the business 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 kind of a potential social adjustment and also reduced worker morale, the organization requires a full reengineering effort at the marketing division.

Problem Declaration
Porter's 5 Forces Analysis
The prospective social modification at the advertising division of Three Year Planning At Li And Fung Limited is increasing unpredictability in the working environment resulting in different obstacles for the Jeannie Lewis who would be changing the head of the department in one year. nalysis

PEST analysis

Political Factors: Political factors play a significant role in impacting tactical choices given that Stapes Inc. needed to abandon its strategies of merging with Office Deport after the Federal Trade Commission's treatment in the process. Offered the truth that the store has a worldwide existence with branches in UK, U.S.A., Canada and also Germany, political factors in each of these countries may have the ability to affect performance or calculated goals. Federal Profession Compensation's antitrust suit versus the merging took up useful time of the organization's senior administration recommending that 'political' factors can have serious ramifications for a global company.

Economic Factors: Financial factors such as the introduction of small companies in the global scenario recommend that Three Year Planning At Li And Fung Limited is growing in an environment where there is prospective development of organisations. Along with this, fact that store consumers are primarily looking for office supplies for home offices recommends that the market has a rising fad of entrepreneurs and home based companies.

Social factors: Social fads in the economic situation show that consumers are searching for comfort along with eye-catching rates. Marketing research demonstrates how the client for Three Year Planning At Li And Fung Limited does not have recognition concerning finding services which can supply a mix of benefit and also low costs.

Technological factors: Technology plays a crucial function in Three Year Planning At Li And Fung Limited's organisation method specifically as the company is piloting Innovation facilities which would use innovation sales and also assistance in the type of memory upgrades, peripheral setups. (Recap of INSECT in appendix 2).

OB Issues and Manifestations.

Several underlying Organizational Actions concerns can be seen in Three Year Planning At Li And Fung Limited's case as highlighted in this section.

Apprehensions regarding cultural modification: There is uneasiness concerning a social change that would certainly happen when Todd Krasnow leaves from his position as the Executive Vice Head Of State of Marketing with the majority of the personnel currently showing discontent over this possible relocation. This anticipated change has developed stress and anxiety in the work environment which has been coupled with the previous stress and anxiety of preparing the firm for a potential merger with Home Deport.
Pest Analysis
Stressful Job Setting for Newcomers: There is shortage of workers that can match the stressful setting of a fast-paced organization. Not only does this bring about trouble in discovering the appropriate individuals, it places anxiety on new hires as can not stand up to the speed and also pressure that the organization expects them to bear.

Twin Reporting Lines: Novices locate this business culture troublesome as well as tough to handle particularly as dotted line partnerships are indicated to be weaker generally and also unbiased setting and performance analysis is still done by the solid line supervisor. This indicates that newbies could shed quality regarding their corresponding roles as well as purposes particularly as populated line coverage does not keep them in straight communication with the solid line supervisors.

Bitterness From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor instead of Bridget Coles even though it had actually been hypothesized that the latter would take Krasnow's position came as an impact to her spirits. Lewis may have been capable and also proper for the job but the truth 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: Fear as well as insecurity can be recognized as two significant issues that Lewis would certainly be managing particularly as the merger has currently be cancelled as well as two elderly execs of the advertising division would certainly be leaving. The whole responsibility of the division would be dropping on Lewis's shoulders that would not simply be in charge of brining regarding a cultural adjustment but would certainly additionally have to prove herself in her new duty.

Incompatible Administration Design of Leader: Lewis's monitoring design as well as its incompatibility with the marketing division's duty can also be seen as an OB challenge particularly as she has been made use of to handling problems in the operations division where personnel are shown to focus on procedures and also get them. The advertising and marketing department on the other hand can be viewed as a team of people that are used to being supported by Krasnow that concentrated a lot more on output than procedures.

Interdepartmental Disputes: Interdepartmental differences in between 3 divisions, advertising and marketing, merchandizing and operations specifically over the allowance of the advertising mix can be determined as one more OB problem. The marketing division does not share the very same vision as the other two departments concerning the aloocation of the advertising mix twoards promotions and advertsing, the merchandizing as well as operations departments do not agree over the advertising mix appropriation amongst one an additional either.

Fragmentation in Advertising And Marketing Division: Disintegration between the marketing and advertising departments can be recognized as an additional OB concern which might require additional interest. The reality that the marketing and advertising areas in the advertising division are disconnected is stopping both departments from gaining from each various other's experience and knowledge. Integration of advertising and marketing with retailing as well as procedures would come to be more difficult if the marketing department itself is disintegrated which can be another prospective OB concern.

Three Year Planning At Li And Fung Limited Analysis

Different theories have been used to discuss the situations to get additional clearness regarding the scenario handy.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, most managers think that juniors are easy as well as careless, have little aspiration and withstand adjustment. The circumstance at Three Year Planning At Li And Fung Limited is not entirely adhering to Concept X, it can be seen that brand-new hires are finding this environment rather demanding which might at some point lead to a greater inclination of the administration towards Theory X. Also while examining Lewis's administration design, theory X might have been ideal in the operations division to some degree but the Advertising department would certainly require dependence on Concept Y in order to get the creative thinking and originality from the teams.

Tuckman's Teamwork Theory: As much as Lewis's problem concerning bringing consistency in between the advertising as well as advertising and marketing department is concerned, this would initially lead to clash as discussed by Bruce Tuckman in his 'Synergy Concept'. By incorporating the advertising and marketing and advertising and marketing department's job, there may be the very same initial separate which might lead to the 2nd stage of 'storming' where the groups challenge one another.

Bridges' Transition Version: Based On William Bridge's theory (appendix 4), people are fairly uneasy with modification, which is apparent by the situation at Three Year Planning At Li And Fung Limited The circumstance can be viewed as a normal course of life if is studied as per Bridge's theory where he discusses that people undergo 3 phases of shift when they experience change. 'Closing, shedding and Releasing', The Neutral Area as well as 'The New Beginning' (Bridges, 2004). When people exist with modification, they get in phase one and so there might be feelings like sadness, unpredictability, aggravation, temper, worry, rejection as well as disorientation.The circumstance at the advertising and marketing department of Three Year Planning At Li And Fung Limited is similar so Lewis can obtain comfy with the suggestion that it is not amazing habits. In the 2nd stage, there may be a need to connect the space between the new and also old culture so Lewis might have to encounter this challenge once Krasnow leaves. There might be low morale and low efficiency at this stage which need to not be taken as an obstacle. It is during this phase that Lewis will certainly need to provide advice to the division so that they can find a sense of direction. It can be seen just how Krasnow has currently made this change easier by making Lewis obtain involved in the department a year before his real departure. According to Bridges' Version, phase three will certainly bring about visibility to knowing, High energy as well as commitment as individuals will certainly welcome the change (Bridges, 2004).
Vrio Analysis
Abraham Maslow in his Theory of 'Demands Power structure' (appendix 5) has reviews the importance of 'protection needs as being a lower degree demand of a human for activating inspiration. As seen in the pyramid shared in appendix 3, we can see exactly how 'the demand to really feel safe and secure and out of threat' is at the second degree of needs. Prior to a worker can be made to establish psychologically, he needs to have his 'Physiological 'and also 'Security' needs satisfied.

SWOT Analysis for Three Year Planning At Li And Fung Limited Case Study

Effects of Analysis.

The OB analysis has taken a look at numerous concepts to understand exactly how to deal with the present circumstance at hand. The adhering to three alternatives have actually been proposed to aid Lewis handle the business obstacles in the advertising and marketing department. Each of these choices has been proposed for reducing the change needed to bring the marketing department in line with the demands of the marketplace and for making the social modification that would certainly follow when the present leader leaves.

Combination of marketing and advertising features. Separating Adverting as well as Production features. Assimilation of Marketing with Operations.

Assessment of Alternatives.

Judith Shapiro that has actually earlier been interviewed by Lewis during the earlier merger days has knowledge in business-to-business advertising along with company and also retail marketing experience. When Krasnow leaves, Lewis can employ Shapiro as an EVP for advertising and marketing to manage both advertising and advertising functions.

The benefit of this strategy is that it will incorporate the two functions while lowering the requirement for working with an additional source for marketing. Lewis would be heading the marketing division and also in any type of case her replacement would be required for the present role that she is executing. The disadvantage of this alternative is that outside hiring might bring about bitterness from internal employees that might be considering the setting of EVP after Lewis takes control of Krasnow's position.

Dividing Adverting and Manufacturing: Offered the competitive pressures and high top quality work needed from the advertising and marketing firm, it is recommended that Lewis should enable the production unit to be a separate function from the advertising system. Since the majority of advertising agencies had these two features as separate devices, it makes even more feeling to adhere to the standard.

Combination of Advertising with Operations: Considering that Lewis is currently taking care of the advertising and also procedures departments at the same time; it makes sense to integrate the two features considering that she has actually been efficiently taking care of both ends. The fact that Lewis has to adapt her monitoring design for the marketing department recommends that these two divisions would be culturally diverse.


An assessment of the 3 choices suggests that assimilation of advertising and marketing and also procedures would not be a practical step due to the huge differences between the two divisions although that currently Lewis is managing both. While splitting up of the production function may have been a positive step for the advertising and marketing department, the fact that it would certainly imply positioning a 3rd function under Lewis's wing indicates this must be stayed clear of. The combination of the advertising and marketing division is the most effective alternative in regards to obtaining the optimum arise from the division. An action plan for this choice is reviewed listed below.

Activity Plan.
Lewis will take over the role of EVP Marketing after Krasnow leaves.

Marketing and advertising features would certainly be combined.

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

Manufacturing feature will certainly stay part of advertising under advertising feature.

Lewis will divide herself from procedures.

An autonomous management style with staff member empowerment will be utilized in marketing division.

Open up door policy and emphasis on cross departmental interaction will certainly be focused on removing dissonance.

Backup plan.

If the assimilation does not work out as intended, a backup plan would certainly follow which would separate the manufacturing feature from the marketing feature to decrease the lots on the SVP of advertising and marketing. In case Judith Shapiro does not get worked with, Lewis will be heading the marketing division without an SVP. In that case the production function will most definitely be separated by positioning it under an SVP manufacturing.