Electra-Quik Case Study

INLS 131: Penina Matthew Carroll July 2002

The main problem of this case study lies in the existing corporate culture of the business and the newness of the proposed company revisions. Electra-Quik is an established company that has historically done well until recently, when a host of problems ranging from outside competition to company moral became apparent. It would be nice to know more information concerning the extent of the company’s problems, but since they are not talked about in detail, this case study will assume that they are moderately severe since people are actively seeking other employment.

Martin Griffin, the CEO hired to turn the company’s fortunes, wants to address the corporate culture first and foremost with his new empowerment campaign. The challenge he faces is multi-faceted, but the root problem lies with the corporation’s culture and its lack of open communication channels and flexibility. It would be nice to know more about Martin’s track record as a CEO, the types of business he worked for in the past, and the other problems he addressed.

From the case study it seems that many employees are thoroughly disenchanted by the current culture (employees are “actively seeking” other employment opportunities), and may see upper management as unbelieving in their abilities (Harry’s statement concerning faith in the employees is an example). As well, change is frowned upon as previous attempts (downsizing, reengineering, restructuring) have all failed. The reasons why these other attempts failed is a mystery, but from this case study it can be assumed that among other factors there existed a resistance to change from the employees and department heads. It seems apparent from the case study that employees who believe in Martin’s designs from the beginning, like Barbara Russell, are a minority.

Martin started his campaign on empowerment by having upper management teams meet and devise methods to implement empowerment among the corporation. The goals of these teams were to brainstorm, and indeed, Barbara and her manufacturing team did come up with many interesting ideas. One initial problem here is that these teams were all divided according to departments and were staffed accordingly. Thus, Martin’s campaign suffered a critical blow in its earliest stages in two ways.

First, Martin may not realize the problems with inter-departmental communication that exist at Elextra-Quik as he may not have been with the company for long enough a period of time or have gotten to know the key personnel in the departments. This could be why he left the second meeting leaderless, with Barbara and every other team manager to fend for him or herself. Had Martin met with each department head in advance and tried to glean information about the corporate culture and each department head’s opinion of his empowerment campaign, he might have had a better idea as to how he should implement his reforms. By meeting with each department head, Martin could also have asked for their input and possibly gotten them all on the band wagon individually. Thus when his ideas were released to everyone at the meeting, each department head would have a sense of ownership of the idea and would likely be more in favor of the changes Martin wanted to institute.

Second, by having each team membership consist of only one department, each team invariably brought an ethnocentric list of possible company changes that ultimately missed critical issues that related to other departments and that did nothing to contribute to the poor departmental communication. The people in Barbara’s team, while confident of their proposed changes, failed to look at critical issues to other departments because those issues were simply not important to the manufacturing department. Thus the project proposal her team presented appeared to discount the importance of the other departments and did nothing to nurture inter-departmental communication.

In the current situation, there now exists an enthusiastic CEO who wants to reform the company but who appears clueless about the current corporate culture, a number of unrefined ideas for implementing the empowerment campaign from each department team, and a number of employees that are both for and against this campaign.

The project proposals that Barbara’s team presented at the second meeting were well received by Martin, but no mention is made concerning either the reactions of the other department heads or of the other department-team project proposals. It can be inferred from the reactions to Barbara’s team’s proposal that each department took a critical view of each other department’s proposals and there existed a general resistance among all the department teams to change according o the standards of another department. One could also surmise that Martin holds some respected power here since there was no voiced opposition to the Barbara’s proposal while Martin was present at the meeting. This could be another element of the corporate culture, where upper levels of management do not communicate effectively for some reason.

In this situation, one of the most important things for Barbara to do is to communicate to Martin the existing problems concerning communication and trust between departments. Nothing positive will be accomplished in the second meeting with Martin absent, and the chances of people further entrenching against these empowerment changes is great since there already exists a mood of resistance. Because of the flawed nature of the initial problem-solving teams, further work along these lines will serve only to further skew the empowerment campaign.

Barbara’s other choices, to push ahead with grim determination while the CEO remains ignorant to the real cultural standard, is doomed to failure if for no other reason than that Barbara has no definitive clout among the rest of upper management, and thus not enough weight to throw around to effect change. She could try to make new teams or to debate the proposals of her team, but she may not carry enough authority to lead the other departments in such an action. Such actions could inevitably strain the current inter-departmental communications further and may not provide any positive results without lots of hard work.

Quitting seems a bizarre choice for Barbara as she is content with her job and eager to work for Martin’s empowerment campaign, and simply shutting up over the matter would do nothing to solve the problem and would only serve those who are against the empowerment campaign.

Once Martin is made aware of the poor communication relationships that currently exist, steps can be made to attack the problem from a different angle. Barbara, by confronting Martin on these issues, serves herself and the campaign by showing her supervisor that she is both interested in his idea and its success and by providing Martin with necessary insight into the corporate culture that he may have yet to fully realize. As a CEO who’s main function is to please the stock holders of this publicly traded company, Martin should value the information Barbara can provide him as it would serve to both increase his plan’s potential for success and to please his bosses.

Once he is made aware of the current situation, Martin will have a better grasp on just what the problems are that exist at Electra-Quik and how to solve them. As the CEO,

Martin should take a strong management stance and exert his power over the department heads by clearly demarking the chain of command. Done effectively, Martin would thus have established among upper management that his ideas will be implemented and that it would be wise to support him in the campaign. This can be done by simply repeating his credos among the employees, by being very clear on his ideas, and by encouraging open discourse among the levels of upper management. This serves to not only define the company goals but to instill a new sense of purpose among the employees through strong leadership.

Next, Martin needs to regroup the initial project teams so that each team consists of a variety of employees from different departments. Having employees from different departments actually work with and speak to each other is the first step to eventually tearing down the communication barriers that currently exist in the company. This methodology serves other useful purposes as well.

By having the teams be comprised of employees from the various departments, each team now has a wider perspective on innovation ideas and their consequences on various departments in the company. When one team member from manufacturing presents the idea of having a sales person step into a manufacturing role to gain an insight into the job, there would be another team member from sales to actually offer input about the idea, and a member from human resources to object to it. Debate would be carried in the team environment, and a final decision would thus have a strong reasoning behind it when presented to all.

As well, by having a team make-up that is cross-departmental, when teams present their ideas there will no longer exist a “you against us” attitude. Ideas presented would not just be from the manufacturing department, but from a team member who can be identified with by members of a particular department. This inclusion is a key factor in any idea’s success as it provides the necessary support to keep that idea alive and healthy. Homogenizing the departments also serves to break down the existing barriers by denying the team members personal flags to rally around. Instead, the company banner becomes dominant and each team ultimately identifies with the company and not merely their department (Can I say “think outside the box?”).

At this point it would be nice to know more about Martin and his history in the corporate world, and the relationship between Barbara and Harry. With this knowledge, it becomes possible to study Martin’s management style and track record so that more definitive conclusions can be drawn concerning what he should do. As well, knowing how Barbara and Harry relate can offer guidelines to how Barbara may be able to use

Harry as an information tool for gauging employee’s opinions regarding the empowerment campaign and the corporate culture in general. This is just the first step towards launching Martin’s empowerment campaign and turning the company into a motivated, profitable entity. Much work has yet to be done to ensure that Electra-Quik even has a chance of becoming a market leader again, although Martin is correct in his desires to change the corporate culture.