Keller International

(1) Over the past five years, sales at Keller International, an international engineering group, had grown at an average 5% per annum. This average masked very considerable differences in performance by the divisions within the group. The Hardware Division, the largest division, had consistently outperformed the other divisions with average growth of 8% per annum. The Lifting Products Division and Power Systems Division had grown by approximately 4%. The Logistics Division had seen growth of only 1%.

(2) The chief executive of Keller, Dough Norton, concerned at the performance of the Logistics Division, had persuaded his board of directors three months ago to fire its chief executive. A new chief, Jeff Wood, was appointed and given the objective to increase sales by 3% in his first year and 5% in his second year. Profits had to increase in line with sales.

(3) Jeff Wood, on his first day in office, called a meeting with his senior marketing managers and outlined the targets set. He asked them to produce a plan detailing how sales could be grown profitably within the time scale set. He wanted the plan with supporting documentation ready for a presentation in three days time. During the time, Jeff Wood familiarized himself as much as possible with the previous work of the marketing department. He called in all the senior managers one by one for an interview. The presentation took place over one day with Jeff questioning every aspect of what was being proposed.

(4) Over the next seven days, the marketing team was restructured. Three senior members of the team, including the head of marketing, whose performance Jeff thought was inadequate, were told that they would lose their jobs. The former assistant head of marketing was promoted to head of marketing and there was a reorganization of roles within the department. A new marketing plan was thrashed out with clearly identifiable targets for the department as a whole, broken down by country and product. Individual marketing managers, who had contributed to the construction of the plan, were made responsible for achieving those targets.

(5) The implications for increasing sales were then worked out for each of the other departments within the division. The emphasis was upon drawing up plans which would see modest increases in costs to ensure that the sales increases generated growth in profits. The personnel department helped devise an incentive scheme for individual members of the marketing department to reward them for achieving their objectives.

►Case task:

What are the key features of MBO? Illustrate your answer with examples from the case.

‘PROS & CONS’ POINT

►Fill in the table with the information you have come up with and learned so far:

Table. Advantages and disadvantages of MBO

‘SHOW’ POINT

►Now that you have analyzed and mastered various types of management theory hold a panel discussion on “Points in favor of and against ‘Management as seen scientifically’”. For this discussion you will need the following GURUS:

1. Abraham Maslow

2. Douglas McGregor

3. W. Edwards Deming

4. J.J. Juran

5. Bill Hewlett

6. David Packard

7. Peter Drucker

8. George Odiorne

9. Tom Peters

10. John Case

Be imaginative! Surf the Internet to get more knowledge on the subject. Good luck!

‘PUZZLE-1’ POINT

►Translate the verbs below into Russian avoiding the same roots:

Identify, liquidate, manipulate, imitate, adapt, modernize, accumulate, limitate.

►Now translate the sentences below giving all possible Russian equivalents to the words in italics:

1. The Chief Accountant has identified a number of problem areas preventing the company from experiencing a net increase in cash.
2. One of the main targets of marketing is to identify the needs of prospective consumers.
3. If the company is progressively incurring heavy losses, its shareholders may even become involved in liquidating it.
4. The shares were sold to liquidate the debt.
5. Manipulating facts and figures in accounting is a slippery slope to bankruptcy.
6. The recent economic slump enables some ‘shady’ politicians to manipulate the market.
7. Good management means skillfully manipulating all the tools and incentives a manager may have at hand to motivate the staff.
8. Ricardo Semler proved to be so successful a leader that many generations of leaders have tried to imitate his style.
9. Most businesses have had to adapt to current market conditions.
10. Woods International had to adapt its product range to the local market.
11. To discourage some multinationals from abusive behaviour resulting in unfairly dominating the market is to modernize existing antitrust legislation.
12. The COO modernized the factory to adapt to recent trends.
13. The company will skid into bankruptcy if it does not modernize.
14. The company accumulated some €350,000 in debt.
15. The antitrust committee has accumulated enough evidence to bring/press charges against the company.
16. By 2000 he managed to accumulate the capital his father left him to start his own business.
17. The board of directors made a decision to limit exports to China.
18. Peter Drucker is quite convincing in his books but he never urges managers to limit themselves to his ideas.

MAKE YOUR POINT

►Discuss the questions. Support your views with examples.

How far should a supervisor go in criticizing the performance of a subordinate? Some highly successful managers have been known to rely on verbal abuse and intimidation. Do you think that this is an effective means of communicating expectations? If not, what alternative should a manager use in dealing with someone whose work is less than satisfactory?

‘PREPOSITION’ POINT

►Fill in the blanks with the right prepositions:

1. A thirst ___ continuous education and self-improvement is a good feature of an employee.
2. The senior executives were not capable ___ allocating the company’s annual budget without the consent of the CEO.
3. The company has seen considerable increase ___ employee morale.
4. ___ the end, the firm has introduced its annual statements on its corporate website.
5. The company’s organization culture allows its entire workforce to satisfy their needs ___ achievement and self-respect.
6. Quality is a matter of conforming ___ a customer’s requirements.
7. ___the end of the meeting, the Vice-President clearly expressed the extent ___ which the bonus program can be applied to middle managers.
8. The stodgy structure at RST was replaced ___ more flexible one.
9. This style of management is commonly referred ___ ___ MBO.
10. We are still in need ___ a flat organization structure.
11. New corporate rules give the management no easy excuses ___ failure.

CASE-4’ POINT

Date: 2016-01-05; view: 1017