Air Miles Canada Case Study Solution


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Air Miles Canada Case Study Help

Background and Facts

Air Miles Canada an office supplies retailer for little and medium sized companies has lately been associated with preparing for a merging with its rival House Deport, which has actually affected performance degrees in departmentswith the senior supervisor associated with legal difficulties presented by the federal Profession Commission. With the Advertising Head putting forward the information of his separation from the business in one year, Jeannie Lewis, the current head of procedures has been asked to take the duty in the future. With challenges in the type of a possible social change and low staff member spirits, the organization needs a total reengineering initiative at the advertising and marketing division.

Trouble Declaration
Porter's 5 Forces Analysis
The potential cultural adjustment at the advertising division of Air Miles Canada is increasing uncertainty in the workplace resulting in various obstacles for the Jeannie Lewis that would certainly be replacing the head of the division in one year. nalysis

PEST analysis

Political Factors: Political factors play a major duty in impacting strategic decisions because Stapes Inc. had to desert its plans of combining with Workplace Deport after the Federal Trade Commission's treatment while doing so. Given the reality that the shop has a worldwide existence with branches in UK, UNITED STATES, Canada as well as Germany, political consider each of these nations may have the ability to impact performance or calculated objectives. Federal Profession Compensation's antitrust suit against the merger used up beneficial time of the organization's elderly administration recommending that 'political' factors can have major effects for an international company.

Economic Factors: Economic factors such as the development of local business in the international situation suggest that Air Miles Canada is growing in a setting where there is prospective growth of organisations. Reality that store customers are mostly looking for workplace supplies for home workplaces recommends that the market has an increasing fad of business owners as well as house based organisations.

Social factors: Social patterns in the economic situation reveal that clients are trying to find ease along with eye-catching rates. Market research shows how the consumer for Air Miles Canada lacks recognition about discovering options which can use a combination of convenience and low costs.

Technical factors: Innovation plays an important function in Air Miles Canada's company approach particularly as the company is piloting Technology centers which would certainly provide technology sales and assistance in the form of memory upgrades, peripheral setups. (Summary of PARASITE in appendix 2).

OB Issues and also Symptoms.

Numerous underlying Business Behavior issues can be seen in Air Miles Canada's case as highlighted in this area.

Uneasiness regarding social adjustment: There is worry about a social change that would occur when Todd Krasnow leaves from his setting as the Executive Vice Head Of State of Advertising And Marketing with most of the personnel currently revealing unhappiness over this prospective action. This anticipated adjustment has actually created anxiety in the office which has actually been coupled with the past stress and anxiety of preparing the firm for a prospective merging with Home Deport.
Pest Analysis
Stressful Work Atmosphere for Newcomers: There is scarcity of workers that can match the stressful environment of a busy company. Not just does this cause problem in locating the ideal people, it places tension on new hires as can not hold up against the pace as well as pressure that the company anticipates them to birth.

Twin Coverage Lines: Newcomers discover this organizational culture troublesome as well as tough to cope with particularly as populated line connections are meant to be weaker as a whole and also objective setting as well as efficiency assessment is still done by the solid line supervisor. This indicates that newcomers might lose clearness concerning their particular roles as well as goals especially as populated line reporting does not keep them in straight interaction with the strong line managers.

Animosity From Cross Departmental Hiring: Krasnow's decision to make Lewis his successor instead of Bridget Coles although it had been speculated that the last would certainly take Krasnow's position came as an impact to her spirits. Lewis might have been capable and also proper for the work yet the fact that Kransnow's departure would make Coles a straight report to Lewis might have been the reason for Coles' resignation from solutions.

Anxiety & Job Instability: Fear and instability can be determined as two major worries that Lewis would certainly be handling particularly as the merging has now be terminated as well as 2 senior execs of the marketing department would be leaving. The whole responsibility of the division would certainly be falling on Lewis's shoulders who would certainly not simply be in charge of brining about a social modification however would certainly likewise have to confirm herself in her new role.

Incompatible Monitoring Style of Leader: Lewis's administration design and its conflict with the marketing department's role can likewise be viewed as an OB obstacle particularly as she has actually been made use of to dealing with concerns in the operations division where personnel are educated to concentrate on processes and also obtain them right. The advertising and marketing department on the other hand can be viewed as a team of people that are used to being nurtured by Krasnow that concentrated more on output than procedures.

Interdepartmental Disputes: Interdepartmental disputes between 3 divisions, marketing, merchandizing as well as operations specifically over the appropriation of the advertising mix can be identified as one more OB issue. The advertising and marketing division does not share the very same vision as the other two divisions regarding the aloocation of the advertising mix twoards promos and also advertsing, the merchandizing as well as operations divisions do not concur over the advertising and marketing mix allowance among one an additional either.

Fragmentation in Advertising And Marketing Department: Fragmentation in between the advertising and marketing departments can be identified as another OB issue which can need additional focus. The reality that the advertising and marketing areas in the advertising and marketing division are detached is preventing both departments from gaining from each other's experience as well as experience. Integration of advertising and marketing with merchandising and procedures would come to be more difficult if the advertising and marketing division itself is disintegrated which can be one more prospective OB concern.

Air Miles Canada Analysis

Various theories have actually been used to discuss the situations to get additional quality regarding the circumstance available.
Swot Analysis
McGregor's Theory X & Y: According to Douglas McGregor's Theory X, many managers think that juniors are passive and lazy, have little ambition and resist modification. The hard variation of this concept highlighted threat, limited controls, risks and punishments. Gradually it produces low efficiency, subtle sabotage as well as competition (Bargain, 2003). The situation at Air Miles Canada is not completely complying with Concept X, it can be seen that brand-new hires are discovering this atmosphere instead stressful which might at some point lead to a higher disposition of the administration towards Theory X. Based on McGregor's advocated sight, which he called Theory Y, the essential job of the administration is to arrange business problems to ensure that people can achieve their own goals best by directing their efforts in the direction of organizational incentives. If individuals locate no contentment in their job, the administration would have little choice however to depend on theory X as well as exterior control (Deal, 2003). Even while analyzing Lewis's management style, concept X may have been suitable in the procedures department somewhat yet the Marketing department would need dependence on Theory Y to get the creative thinking as well as creativity from the teams.

Tuckman's Teamwork Theory: As far as Lewis's problem concerning bringing harmony between the advertising as well as advertising division is worried, this would originally lead to clash as gone over by Bruce Tuckman in his 'Synergy Theory'. By integrating the marketing as well as marketing department's work, there may be the exact same first separate which could lead to the second stage of 'storming' where the groups test one another.

When individuals are offered with adjustment, they get in phase one and also so there might be feelings like despair, unpredictability, irritation, rage, fear, denial as well as disorientation.The scenario at the advertising division of Air Miles Canada is similar so Lewis can get comfy with the idea that it is not extraordinary behavior. It is throughout this stage that Lewis will certainly have to offer support to the department so that they can find a feeling of direction. It can be seen exactly how Krasnow has actually currently made this change less complicated by making Lewis obtain entailed in the division a year before his real departure.
Vrio Analysis
Abraham Maslow in his Theory of 'Needs Power structure' (appendix 5) has goes over the value of 'security needs as being a lower degree need of a human for triggering motivation. As seen in the pyramid shared in appendix 3, we can see exactly how 'the need to really feel safe and also out of threat' is at the 2nd degree of needs. Prior to a worker can be made to create psychologically, he requires to have his 'Physical 'and 'Safety' needs fulfilled.

SWOT Analysis for Air Miles Canada Case Study

Implication of Analysis.

The OB analysis has looked at different concepts to recognize how to handle the current circumstance at hand. The complying with 3 options have actually been suggested to assist Lewis manage the organizational obstacles in the advertising division. Each of these choices has been proposed for reducing the transition required to bring the advertising and marketing division in line with the requirements of the market and for making the cultural modification that would follow as soon as the present leader leaves.

Assimilation of advertising and marketing features. Dividing Adverting and also Production features. Combination of Advertising And Marketing with Operations.

Examination of Alternatives.

Integration of Advertising & Advertising And Marketing Functions: The in-house marketing firm of Air Miles Canada is currently stamina for the company in regards to conserving up on overheads related to marketing and promo. Because no new recruitment has actually been done after Bridget Cole's separation with the coverage line being directly designated to Krasnow for the marketing function, this is a positive opportunity for incorporating the marketing and advertising functions. Judith Shapiro who has earlier been interviewed by Lewis throughout the earlier merging days has competence in business-to-business advertising in addition to company and also retail advertising experience. As soon as Krasnow leaves, Lewis can hire Shapiro as an EVP for advertising to deal with both advertising and marketing features.

The advantage of this strategy is that it will certainly incorporate the two features while minimizing the need for hiring an additional resource for advertising. Along with this, Lewis would be heading the advertising division as well as all the same her replacement would certainly be required for the existing function that she is performing. The disadvantage of this choice is that exterior hiring may produce resentment from interior employees that might be looking at the placement of EVP after Lewis takes over Krasnow's placement.

Dividing Adverting and also Manufacturing: Provided the affordable pressures as well as premium quality job needed from the ad agency, it is advised that Lewis must allow the manufacturing unit to be a different feature from the advertising and marketing unit. Considering that many ad agency had these 2 features as different systems, it makes even more feeling to comply with the norm. Both functions may be able to concentrate on their core triggers extra efficiently. The downside of this technique would be that additional expenses would have to be borne for establishing up different manufacturing functions. A manufacturing head may have to be hired which might boost expenses for the company.

Integration of Advertising And Marketing with Workflows: Given that Lewis is already caring for the advertising and operations divisions all at once; it makes good sense to integrate the two functions because she has actually been efficiently taking care of both ends. The truth that both departments currently have major differences over appropriation of sources recommends that this assimilation may be able to bring about consistency particularly as Lewis would be heading both ends.However there are numerous downsides of this action especially as it would certainly place excessive worry over Lewis's shoulders. The fact that Lewis needs to adapt her monitoring design for the marketing division suggests that these 2 departments would be culturally varied. In addition to this, Lewis may not be able to use one type of leadership design to both departments which might cause inefficiency in either one of both features.


An analysis of the three options shows that assimilation of marketing and also procedures would certainly not be a viable relocation because of the substantial differences in between both departments although that presently Lewis is handling both. While splitting up of the manufacturing function may have been a positive action for the advertising department, the fact that it would certainly suggest placing a 3rd function under Lewis's wing suggests this must be stayed clear of. The integration of the advertising division is the best option in regards to obtaining the optimal arise from the division. An activity prepare for this option is discussed listed below.

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

Marketing and advertising features would be combined.

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

Manufacturing function will remain part of advertising under advertising and marketing feature.

Lewis will certainly separate herself from operations.

An autonomous management style with staff member empowerment will certainly be made use of in advertising and marketing department.

Open up door plan as well as focus on cross departmental interaction will certainly be aimed at eliminating discord.

Backup strategy.

If the integration does not exercise as prepared, a contingency plan would follow which would divide the production feature from the advertising and marketing function to reduce the lots on the SVP of advertising and marketing. In case Judith Shapiro does not obtain hired, Lewis will certainly be heading the advertising and marketing division without an SVP. In that case the production feature will most definitely be divided by positioning it under an SVP manufacturing.