Leah R. Davis
Case Analysis: Iggy’s Bread of the World
• This small start-up business was the dream of its owners and founders Igor and Ludmilla Ivanovic; it grew exponentially, quicker than the owners could keep up with administratively and operationally. • The business’ early success can be attributed to the owners’ passion, hands on leadership and training style and genuine interest in their employees wellbeing. Their early philosophy embraced a 3-fold unique culture: the highest quality product, their staff and their community/customers – their business was not all about making money. They maintained high employee morale levels through direct communication, training, unique benefits and a fostering a culture of inclusion through cross training and their own version of employee assistance. • When the company decided to bring on a COO, who in turn, hired an external management team, the dynamics of Iggy’s changed. While the team brought a level of expertise to the business that didn’t previously exist, they were aloof from the employees and didn’t relate to the ‘Iggy’s way.’ Communication suffered and the corporate culture changed from the family-style enterprise the Ivanovics had created. • The new team did not take the time to learn about the business and its unique culture before making changes. People are generally resistant to change, especially ones that have not been explained and that they cannot appreciate. The employees felt excluded and the changes at Iggy have caused morale to plummet and the business operations to suffer. • When things came to a head with the COO, the Ivanovics have a tough decision to make about the future of the company. • I would recommend they keep the COO because they need the business skills he possesses to supplement their shortfalls and would likely face the same challenges with a new hire. They should offer him equity in the business instead of profit sharing to foster and maintain...
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