Texana Petroleum Corporation

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Texana Petroleum Corporation

By | August 2008
Page 1 of 4
Conflict in Organizations
Texana Petroleum Corporation
Background
The Texana Petroleum Corporation is a multi-million dollar company and major producer and marketer of petroleum products located in the southwest United States. Texana has five product divisions: Petroleum Products Division, Polymer and Chemicals Division, Molded Products Division, Packaging Products Division and Building Products Division.

The President and Chief Executive Officer, Roger Holmes retired in 1993 and was replaced with Donald Irwin, brought in from a major chemical company. William Dutton, who had worked for Texana his entire career and reported to Roger Holmes, was appointed chairman of the board. Irwin and Dutton expanded the company’s involvement in processing petroleum for chemical and plastic products by acquisitions and internal development. By 2000 the company was “reshaped so that it was an integrated producer of chemicals and plastic materials in both domestic and foreign markets.” Each of the divisions producing and refining crude oil and the marketing of plastic products to industry were set up similarly whereby their functional lines included manufacturing, sales, research and development. They each had their own controller and engineering activities, but shared a central research laboratory.

As the reshaping of the company was finished it was found that each of the divisions were working independently from each other, which in turn is causing conflict between the divisions. This conflict is creating communication barriers between the divisions. George Prentice, Executive VP of Domestic Operations saw the difficulty was that the division general managers were not working well together.

Problem
There was no communication between the divisions general managers thereby creating conflict and a difficult work environment. Relevant Theories and Models
George Prentice, whose major concern is with making a profit for the domestic operations of the...