The Exley Chemical Company Case
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It is inevitable in an organization to have internal problems even how simple or intricate the structure of an organization is. These problems arise anytime and they persist if not recognized and acted upon immediately. Internal problems may be caused by miscommunication, rule disobedience, employee conflicts and many others. If these problems continue much serious problems like non-coordination and defeat of the company’s goals will rise. Organization development is the process to solve these cases. It aims to improve the organization for the benefit of the employees as well as the stakeholders. The Exley Chemical Company has not been free from any of these problems; they had challenges within their company that needs the treatment of organization development.
The Exley Chemical Company Case
- The company experienced a decrease in sales and profits last year because as the technology advances rapidly and additional product lines emerge, there were fast shifts in the sales of the company’s different product groups.
- A company competitor developed a new process of producing polymers which can be sold at lower prices. The competitor is about to patent the newly developed process and it threatened the company’s competitiveness.
- The new product development division faced a conflict in functions with the marketing and other departments.
- The product managers of each product group had conflicts with the marketing executives, other departments and to each other which grew into competing factions.
- Because of the fast shifts in market sales of the product groups, tension among the members of the product groups emerged. Each product group wanted to have better performance in market than the rest which is not actually negative at all for the firm because it motivates everyone however the product groups became factions that are not helping in the coordination of all units in the company.
- With the intention to meet the need of increasing production, the company’s executives formed the new product development division. The function of this new division overlaps with that of the research division and marketing department because the extent of functions they perform was not closely discussed and limited by the top-level management.
- The purpose of appointing product managers is to enhance the coordination of the product’s contribution to the company and in the pursuit to improve the sales of each, product managers did some marketing strategies which was seen by the marketing executives as not contributing to the integration of their markets but rather as acts only for the good of product group the product manager is handling.
III. Systems affected
- Structural: Since there is an overlapping of functions when the product development division was formed, the bureaucracy of the whole company is deteriorated. The specialization of work done by the lower level departments is now shared with this one upper-level product development division.
- Psychosocial: The conflict in different product groups, brought by the appointment of product managers, result to an unhealthy workplace. Unhealthy competition among the product groups exaggerated as each of them wants to have better performance in sales in order to impress the whole company.
- Technical: Due to lack of coordination, there is a slow-down in the transfer of business information (documentation of infrastructures, system designing, etc.) which hinders fast analysis and implementation of business plans. Lack and inefficient information transfer in the company are also possible. (Smoak, 2007)
- Managerial: The management of the new managers is performed well only at their division/department level and they failed to coordinate well in other departments. These bring managers difficulty to communicate, interact and finish work.
- Goals: Since the departments concern only their own, inefficiency and slow-down in work makes the achievement of goal (fast product development) delayed or defeated.
- Advice the management to abolish the product development division since its job could be done by the different pre-existing departments. Designate the division’s employees to the departments for compensation.
- Redefine and limit the functions of product managers by letting the marketing department do the entire product activities in market and by making them focus on the internal coordination of the product.
- To solve the conflict on overlapping of functions, advice the upper-management to retain the product development division in power and make this as the central decision and control body for all product development activities.
- Hire organization development consultants to initiate team-building activities for all the employees to stimulate each department help one another.
- Form a group of facilitators to facilitate each department in their activities at the same time monitoring progress and maintaining the coordination with the other units. This will result into a more focused and managed workforce in achieving optimal level of performance (Eller, 2004, p.8).
Suggest the upper-management to conduct an organizational restructuring proven that conflicts started since the establishment of product development division and appointment of product managers. Disestablish the product development division and designate the employees to the different departments because its functions are already functions of the specific departments. It may be foreseen that with the absence of this division the company may not meet the fast need for product development but it could be solved by motivating the departments do their job faster and more efficiently. It must be assured that department heads check and balance work progresses.
Also, conduct a meeting to redefine and limit the function of product managers in order to eliminate the conflict with the marketing executives. This is also favorable for these managers because of fewer burdens and making them much effective if they coordinate only the internal matters of the product such as product performance reporting, product quality monitoring and others. And this step will reduce the cost the company is shredding out for marketing purposes because only one, the marketing executives, will be in-charge for the over-all marketing activities of all products.
But even if restructuring took place, the tension and conflicts may still exist so it is advisable to conduct compulsory team-building activities. An all-expenses paid group outing will be enticing for the employees to participate. It may be a one-day or more activity just enough to eliminate conflicts and practice cooperation among the departments in order to build good camaraderie and coordination so as to make all departments contribute to the company. And though it requires a large amount of budget, it is still fair enough because it is a need for the company to regain its oneness in achieving their goals.
BPM Institute. (2007, March 26). Business Unit Focused Business Analyst or Technical Systems (IT) Focused Business Analyst: What are the differences?. Retrieved April 16, 2008, from http://www.bpminstitute.org/articles/article/article/business-unit-focused-business-analyst-or-technical-systems-it-focused-business-analyst-what-are.html
Eller, J. (2004). Effective Group Facilitation in Education: How to Energize Meetings and Manage Difficult Groups. California:Corwin Press.