Case of Analysis: Tarco Gmbh. Organization and Design

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1.HOSPI’s sales and production departments seem to have different organizational cultures. Can you describe the different characteristics? Are there reasons beyond the personalities of the sales and production manager that these different cultures should have developed?

These two departments, production and sales, have clearly different approaches of the organization culture. On one hand, the sales department, as the consultant identified in his analysis, takes into account heavily the external environment. For adjusting properly to the external environment, it is needed to be flexible in order to adapt to this external environment, which mainly is focused in this case on the clients, and having a quick response to the possible changes that may occur. These possible changes are different preferences of the customers, which may change very fast, as it is described in the market analysis, the customers are doctors that can share between them and between different hospitals his preferences or experiences with the products. The sales rep need to overtake these wishes and changes, identifying them and act in consequence rapidly. For this purpose, the sales department thinks that the best way to do it is giving total autonomy to the sales rep, acting and not waiting to ask before.

On the other hand, the production department takes an approach totally different to the sales one. Mostly, because of the origin of the production staff, in assembly lines, these employees were not used to planning the production, to be in charge of it. In fact, they do not believe that in this specific department, they have to be in charge of it, being autonomous in their tasks, taking decisions about their performances and actions. They prefer, for the correct functioning of the production, leave all the decisions to their supervisor, Edmundo Ferrari, and they only receive the orders. This approach suited everyone, the workers in production department and their manager.

Basically, the main difference is that the sales department are totally decentralized, working autonomously every sales rep, without neither coordination nor decision-making process; and in contrast, the production department are totally centralized, taking decisions the production manager.

In our opinion, we suppose that each department has specific characteristics, and its determined functions, are very different between them, because of that this differentiation between culture. That is, it is relatively normal that the sales department needs more decentralization and autonomy from the sales rep, and the opposite is needed for the production with assembly lines. However, the aspects that the different cultures should have addressed are: more organization within the sales department, because it generates advantages to have a good information system, which provides feedback between them and the staff could solve personal interests and conflicts, taking down a little bit the strong competition between the, which without limit is not good at all for the company as a whole. Moreover, both departments should share more information between them in order to work more as a whole and creating a unitary business unit, without taking out the autonomy of each one.

2.How does the creation of the strategic alliance change competitive conditions for HOSPI?

Before the alliance, the market conditions were completely different. They were more stable, having several companies of similar size competing between each other. This is, each company knew their competitors and their weaknesses and strengths, and its position in the market. For HOSPI, it seems (suggested in the text) that was more or less the leader or one of the leaders in the sector, with an important market share and with an important success and good performance.

The strategic alliance changes the external situation for the company. Now, several companies, the main competitors for HOSPI, are going to work...
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