RIO GRANDE SUPPLY CO.
A Case Analysis Report for Management Dynamics
Professor Efren Laxamana
Ateneo Graduate School of Business
RECOGNITION OF DECISION REQUIREMENT
FACTS OF THE CASE:
• Jasper Hennings, president of Rio Grande Supply Co., knew that a company’s top executives are responsible for determining an organization’s corporate culture. He was proud of the culture of the Texas-based wholesale plumbing supply company. His management team espoused and lived the values: integrity, honesty, and respect.
• The company’s internet policy only allows use for business-related activity. However, Hennings vetoed the provision that management can review and access anything the employees created, stored, sent, or received via company equipment. The company, though, reserved the right to take disciplinary action, that includes possible termination, and to press criminal charges if an employee was found to have violated the policy.
• Chief of Operations, Henry Darger, had fired a female employee for having accessed a colleague’s e-mail. While in Hennings office, the female worker said, “Just ask Darger what he’s up to when he shuts his office door.” The female worker hurled a threat to hire a lawyer.
• Hennings confronted Darger regarding the female employee’s implication. Darger wept and confessed that ever since a nephew committed suicide and a business venture that he and his wife put up failed, he had been seeking escape by accessing explicit adult pornography sites.
• Hennings asked Darger to take the rest of the day off to think things over while he himself ponders the steps that he would need to take. On the one hand, Darger’s immediate dismissal of the female worker was hypocritical when Darger, the person tasked to uphold policies, was logging on to porn sites. On the other hand, Hennings knew that employees regularly use the Internet for personal use. The company had turned a blind eye because it didn’t seem worth the effort to punish the workers for minor infractions.
• Darger is a valued employee and it would be costly to replace him. If Hennings decides to retain him, he would have to get involved in Darger’s personal life and he’d be handling the chief of operations differently from the way that the female worker was treated.
STATEMENT OF THE PROBLEM
What are the steps that Hennings should take to handle the Darger situation?
It is crucial that the interests of both the organizations and employees’ are considered. Also, it is of utmost importance to review the company’s code of ethics and the policy of enforcement.
DIAGNOSIS AND ANALYSIS OF CAUSES
(Application of principles & concepts)
The internal environment of Rio Grande is as of equal importance, if not more, than the external environment. In this case, we need to focus on the company’s culture in connection with the effects of the sociocultural environment that includes norms and values. The company needs to address the challenges of a possibly values-deficient society with a strong internal culture. The internal culture should have a much stronger values-system to succeed. In line with that, Rio Grande does have measures in place to enforce the values-system but implementation is non-existent. The need for organizations to combine culture and performance measures is a factor that needs to be considered as well.
Hennings can shape cultural norms and values through cultural leadership. This is done through effective communication and making sure that the employees thoroughly understand and model these values. People do what people see. When there is a severed connection between what is expressed and what is being practiced, the people will detect the conflicting messages and this can lead to confusion and inadvertent disobedience. If there is perceived leniency when it comes to policies like the Internet rules that uphold...
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