The business climate in today’s global economy is ever-changing and more competitive than perhaps any time in the world’s history. Companies now face a myriad of challenges that constantly are changing. The key to dealing with such change has remained constant, however; the most successful companies feature strong leadership and a driven, educated workforce. In this day and age, keeping strong leadership in place can be a tricky situation. Companies such as 3M and Chrysler have endured significant leadership changes and in the process encountered an entirely new set of challenges in the process.
The business simulation Managing Across the Organization focused on many of these situational struggles as well. Good Sport was a company that was on the cutting edge of their niche in sports equipment, yet they too endured leadership change as well as departmental resistance to new ideas and overcame these issues to remain a success. The user of the simulation, based on their decisions, moved up through the company rapidly, which in itself presented another challenge.
The following analysis was conducted to examine the key concepts the simulation focused on that are shared by companies in today’s landscape. The companies reviewed range from Chrysler and Ben & Jerry’s to Apple and Wal-Mart. The analysis will examine the challenges each company had, how leadership was affected or handled the situation, and the subsequent factors that were involved. The report will also compare and contrast the companies’ situations to each other as well as identify the key concepts used for this analysis.
“Involvement only occurs en masse when employees identify with the overall culture of the company” (Goldsmith & Clutterbuck, 1985). Organizational culture is the shared assumptions, beliefs, and norms of a group. A strong organizational culture often leads to a strong company with a closely knit employee base. Although today’s business world dictates that management should strive toward developing a strong culture, an organizational culture that is too strong can create its own problems. Hence, there must be balance between an organization and its culture. “…failing to understand how culture works is just as dangerous in the organizational world as failing to understand gravity and the atmosphere is in the physical / biological world” (Schein, 1987). Mission and vision are the key components to creating a strong unified culture within an organization. By implementing a new organizational strategy and creating a customer and teamed based culture, Bob Lutz, the president of Chrysler during the early 1990s, was able to keep Chrysler from imminent bankruptcy.
Bob Lutz created a culture that revolved around innovation and customer satisfaction. During the final four years of Bob’s cultural reformation, 4,600 new ideas were solicited from suppliers. Of the 4,600 suggested ideas, 60% were used, saving Chrysler over $235 million (Zatz, 1994). He formed teams for every aspect of the company’s projects. Each step in development was strategically planned prior to construction. Each team communicated and understood its direction and goals. This focus saved the company from the high costs of unpredicted problems. Every employee was involved in every step or goal, which caused each person to take responsibility for the success or failure of these goals. Additionally, customers were brought to the company in order to provide input at every stage of each new design. Chrysler was determined to gain the satisfaction of its customers, which it succeeded in accomplishing.
As a result of Bob Lutz’s innovative overhaul, Chrysler’s overhead was cut by $4.2 billion in less than four years, and its stock price quadrupled (Zatz, 1994). A strong organizational culture did not form overnight for Chrysler. It took many years and extensive planning coupled by a clear vision. Sadly, organizational culture can be destroyed more...