Business Management and Change- Oroton
OrotonGroup is an importer and retailer of clothing and leather goods and accessories. The business was originally established by Boyd Lane and Australian entrepreneur in 1936. The organisational structure has developed from a simple sole trader in 1936 to a private company called Boyd Lane & Co. Pty Ltd in 1939 and then a public company in 1987 called Oroton International and in 2002 the company was renamed OrotonGroup. Management Theories
Relates more to OrotonGroup’s early history.
Boyd Lane was a major share holder, planned the firms future, made all the decisions, organised finance, controlled transactions and took all the risks. •
Robert Lane was in control of the handbag side of the business. Boyd initially made all decisions but Robert eventually took control. •
The factory that was set up in Sydney in the 1960’s followed classical – scientific principles using a division of labour and production- line methods. •
A factory manager ran that side of the business with an autocratic style of management, in the 1980s it was closed down and relocated to Melbourne. •
The Melbourne factory was also run with high division of labour and production- line techniques. •
By the 1960s there were still only three main levels on the hierarchy: the owners, the factory and warehouse managers and the workers. Behavioural:
Growth of the firms in the 1960s resulted in the development of functional departments. •
The firms growth in sales led to increased emphasis on the role of employees and their value to the business. •
The Bayswater and Knoxfield plant workers were unionised and the firm introduced practises to support and motivate staff. •
In 2003, Robert Lanes priority was to build up a talented management team for each of the Oroton brands. This being a more democratic and participative leadership style of management evolved. •
Ross Lane worked on retaining good staff members and keeping them motivated. •
Staff incentives included employee allowance cards for purchasing OrotonGroup products and a staff share scheme. Sales staff may be provided with sales performance incentives. •
The structure remains fairly flat with a friendly employee- manager relationship. Political:
The political management theories are evident in the following aspects of operations:
Management executives need to ensure that the ‘brands’ work together and do not interfere with each other.
The management team of each brand focuses on providing motivation, leadership and negotiation to bind their employees together.
Staff wages are based on award and over award payments. Staff members have the option to be involved in enterprise agreements and can join unions of they want.
Sources of Change- Internal & External Environment
Changing nature of markets:
Buying bags from other countries for distribution in Australia – mesh bags from Germany and leather bags from Italy in China, the products were also better quality. •
The late 1960s saw an increased competition from Giomesh and Park Lane. The competitors used local manufactures and provided a cheap product which lead to a decrease in sales revenue for Oroton. •
By the mid 1970s mesh bags were becoming out-dated- the trend was leaning more towards leather bags. •
In the late 1970s Oroton started to import leather handbags from Italy and by 1981 they had discontinued there product line of mesh handbags. •
In 1978 to improve supply Oroton bought 25% of Vanber a small leather goods manufacturer in Australia. This also elimated Vanber who was a small competitor. •
Trends in fashion and a more multicultural demography have been major sources of change for OrotonGroup. •
By 1984 domestic limitations saw a further need for diversity. They acquired the distribution rights for 10 brand names. •
By 1986 they further expanded establishing a US office to market Ken Done designed products in North America. •
In 2001 they took...
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