Is Innovation In Pricing Your Next Source Of Competitive Advantage Case Study Solution


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Background and Facts

Is Innovation In Pricing Your Next Source Of Competitive Advantage a workplace materials retailer for little as well as moderate sized businesses has actually just recently been associated with planning for a merger with its rival House Deport, which has actually influenced efficiency degrees in departmentswith the senior manager associated with lawful issues presented by the federal Trade Payment. With the Advertising and marketing Head advancing the news of his departure from the firm in one year, Jeannie Lewis, the present head of operations has actually been asked to take the duty in the near future. With challenges in the type of a prospective cultural adjustment and also reduced worker spirits, the company requires a complete reengineering effort at the advertising and marketing department.

Problem Declaration
Porter's 5 Forces Analysis
The potential social change at the advertising and marketing department of Is Innovation In Pricing Your Next Source Of Competitive Advantage is raising uncertainty in the workplace causing various 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 role in influencing tactical choices considering that Stapes Inc. had to desert its plans of combining with Office Deport after the Federal Trade Compensation's intervention at the same time. Given the truth that the store has an international existence with branches in UK, U.S.A., Canada and Germany, political consider each of these countries may have the ability to influence performance or critical goals. Federal Profession Payment's antitrust suit versus the merger occupied valuable time of the company's senior management recommending that 'political' factors can have major implications for a global business.

Economic Factors: Financial factors such as the appearance of small businesses in the international situation recommend that Is Innovation In Pricing Your Next Source Of Competitive Advantage is flourishing in an atmosphere where there is potential growth of organisations. Along with this, reality that shop clients are primarily looking for workplace materials for office suggests that the marketplace has a rising fad of entrepreneurs and online services.

Social factors: Social trends in the economic situation reveal that customers are trying to find convenience as well as attractive rates. Marketing research shows how the client for Is Innovation In Pricing Your Next Source Of Competitive Advantage does not have understanding about discovering services which can offer a mix of comfort and low costs.

Technological factors: Technology plays an essential function in Is Innovation In Pricing Your Next Source Of Competitive Advantage's business technique especially as the organization is piloting Modern technology centers which would offer modern technology sales as well as support in the kind of memory upgrades, peripheral setups. (Recap of PEST in appendix 2).

OB Issues and also Symptoms.

Several underlying Organizational Behavior problems can be seen in Is Innovation In Pricing Your Next Source Of Competitive Advantage's case as highlighted in this area.

Uneasiness regarding social modification: There is uneasiness concerning a cultural adjustment that would occur as soon as Todd Krasnow leaves from his position as the Exec Vice Head Of State of Marketing with a lot of the employee currently revealing discontent over this possible step. This expected adjustment has actually created anxiety in the office which has been combined with the previous stress and anxiety of preparing the company for a possible merger with House Deport.
Pest Analysis
Demanding Work Atmosphere for Newcomers: There is scarcity of employees that can match the demanding environment of a busy company. Not just does this result in difficulty in locating the best people, it puts stress on new hires as can not endure the pace and pressure that the organization expects them to birth.

Dual Reporting Lines: Beginners locate this business society cumbersome and also hard to manage especially as dotted line partnerships are meant to be weak as a whole as well as objective setup and efficiency analysis is still done by the solid line manager. This indicates that newbies might lose quality regarding their corresponding duties as well as goals particularly as dotted line coverage does not keep them in direct communication with the strong line managers.

Animosity From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor as opposed to Bridget Coles even though it had actually been guessed that the latter would certainly take Krasnow's placement came as an impact to her morale. Lewis may have been capable and also suitable for the work yet the fact that Kransnow's departure would make Coles a straight report to Lewis may have been the reason for Coles' resignation from solutions.

Worry & Task Instability: Anxiety and also instability can be recognized as two significant concerns that Lewis would be handling specifically as the merger has currently be terminated and two senior executives of the advertising department would be leaving. The whole duty of the department would be falling on Lewis's shoulders who would not simply supervise of brining about a cultural modification yet would certainly also have to prove herself in her new role.

Incompatible Monitoring Style of Leader: Lewis's administration style and also its conflict with the advertising department's role can additionally be seen as an OB obstacle specifically as she has been used to handling problems in the procedures division where employees are instructed to concentrate on procedures and also get them. The advertising and marketing department on the other hand can be viewed as a group of people that are used to being supported by Krasnow who focused extra on output than procedures.

Interdepartmental Differences: Interdepartmental disputes between 3 departments, marketing, merchandizing and also operations respectively over the appropriation of the advertising and marketing mix can be determined as an additional OB problem. The advertising department does not share the exact same vision as the various other 2 divisions pertaining to the aloocation of the advertising mix twoards promos as well as advertsing, the merchandizing and also operations divisions do not agree over the advertising and marketing mix allowance amongst one an additional either.

Disintegration in Marketing Division: Fragmentation in between the marketing and advertising departments can be determined as an additional OB problem which can require additional attention. The truth that the advertising and marketing areas in the advertising and marketing division are detached is stopping both departments from obtaining from each other's experience and also know-how. Assimilation of advertising and marketing with retailing and also operations would certainly come to be more difficult if the marketing division itself is degenerated which can be one more potential OB issue.

Is Innovation In Pricing Your Next Source Of Competitive Advantage Analysis

Different theories have been used to explain the scenarios to get more clarity regarding the scenario handy.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Concept X, many supervisors think that subordinates are passive and also careless, have little passion as well as stand up to modification. The situation at Is Innovation In Pricing Your Next Source Of Competitive Advantage is not completely following Concept X, it can be seen that brand-new hires are discovering this setting instead stressful which may at some point lead to a higher disposition of the monitoring towards Concept X. Also while assessing Lewis's management style, concept X might have been suitable in the operations division to some extent however the Advertising and marketing department would certainly require dependence on Concept Y in order to obtain the creativity and creativity from the teams.

Tuckman's Team effort Theory: As far as Lewis's issue concerning bringing consistency between the advertising and marketing and advertising and marketing division is concerned, this would initially lead to clash as talked about by Bruce Tuckman in his 'Team effort Theory'. By incorporating the marketing and advertising department's work, there may be the exact same preliminary separate which might lead to the second stage of 'storming' where the teams challenge one another.

When individuals are provided with change, they get in stage one and also so there might be feelings like unhappiness, unpredictability, frustration, temper, worry, rejection as well as disorientation.The circumstance at the advertising and marketing division of Is Innovation In Pricing Your Next Source Of Competitive Advantage is comparable so Lewis can get comfortable with the idea that it is not phenomenal behavior. It is throughout this stage that Lewis will have to offer advice to the department so that they can find a sense of instructions. It can be seen exactly how Krasnow has currently made this shift easier by making Lewis get included in the department a year prior to his real departure.
Vrio Analysis
Maslow's Demand pecking order: The OB problem related to insecurity at the office has been activated first of all by the change in administration and also second of all by the truth that the merging will certainly no longer be launched. Abraham Maslow in his Theory of 'Demands Power structure' (appendix 5) has discusses the importance of 'safety and security needs as being a lower level requirement of a human for causing motivation. As seen in the pyramid shared in appendix 3, we can see exactly how 'the requirement to feel safe and secure as well as safe' is at the second degree of needs. Before an employee can be made to establish mentally, he requires to have his 'Physical 'and 'Safety' needs fulfilled. This shows that unless the workers are made to really feel safe and secure concerning their existing employment status in Is Innovation In Pricing Your Next Source Of Competitive Advantage they might not get to 'Self-Fulfillment'. (King, 2009).

SWOT Analysis for Is Innovation In Pricing Your Next Source Of Competitive Advantage Case Study

Effects of Analysis.

The OB analysis has actually considered numerous theories to comprehend just how to handle the present situation at hand. The following 3 choices have actually been recommended to assist Lewis manage the organizational difficulties in the advertising department. Each of these options has been recommended for alleviating the transition required to bring the advertising department in line with the demands of the marketplace and also for making the cultural change that would follow once the present leader leaves.

Assimilation of advertising and marketing features. Separating Adverting and also Manufacturing functions. Integration of Marketing with Workflow.

Analysis of Alternatives.

Judith Shapiro that has earlier been spoken with by Lewis throughout the earlier merging days has knowledge in business-to-business marketing along with firm as well as retail marketing experience. When Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising and marketing to handle both advertising and advertising features.

The advantage of this method is that it will certainly incorporate the two functions while decreasing the need for hiring an additional source for advertising. Lewis would certainly be heading the marketing division and also in any case her substitute would certainly be needed for the present duty that she is executing. The drawback of this choice is that exterior hiring might produce animosity from interior workers that might be considering the placement of EVP after Lewis takes over Krasnow's placement.

Dividing Adverting and Production: Provided the affordable pressures and also high quality work called for from the ad agency, it is suggested that Lewis should enable the production device to be a different feature from the marketing device. Given that a lot of ad agency had these two features as different devices, it makes even more feeling to comply with the norm. In addition to this, both features may be able to focus on their core turns on much more successfully. Nevertheless, the disadvantage of this approach would be that additional prices would certainly need to be borne for setting up separate manufacturing features. In addition to this, a production head might have to be worked with which could increase expenses for the organization.

Assimilation of Advertising with Workflows: Given that Lewis is currently looking after the marketing and also operations departments at the same time; it makes good sense to incorporate the two functions given that she has actually been successfully caring for both ends. The truth that the two departments already have significant distinctions over allotment of sources recommends that this combination may be able to cause harmony particularly as Lewis would be heading both ends.However there are various negative aspects of this step especially as it would certainly place excessive problem over Lewis's shoulders. The reality that Lewis has to adjust her monitoring style for the advertising department recommends that these two departments would be culturally diverse. In addition to this, Lewis might not be able to use one type of management style to both divisions which might lead to inadequacy in either among both features.


An evaluation of the three alternatives indicates that integration of marketing and operations would certainly not be a feasible action due to the large distinctions in between both departments despite the fact that presently Lewis is managing both. While splitting up of the production function may have been a favorable step for the advertising division, the truth that it would mean positioning a 3rd feature under Lewis's wing suggests this must be prevented as well. The assimilation of the advertising department is the most effective choice in terms of getting the ideal arise from the division. An action plan for this choice is talked about below.

Activity Strategy.
Lewis will take over the duty of EVP Marketing after Krasnow leaves.

Advertising and Marketing functions would be merged.

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

Production feature will continue to be part of advertising and marketing under advertising function.

Lewis will certainly separate herself from procedures.

A democratic management style with staff member empowerment will be utilized in marketing division.

Open door plan and also emphasis on cross departmental communication will certainly be targeted at eliminating dissonance.

Contingency strategy.

If the assimilation does not exercise as prepared, a contingency strategy would follow which would certainly separate the manufacturing function from the advertising and marketing feature to lower the tons on the SVP of advertising and marketing. In case Judith Shapiro does not get worked with, Lewis will certainly be heading the advertising department without an SVP. In that case the production feature will definitely be divided by placing it under an SVP manufacturing.