Organizational diagnosis of Palm Computing after Hewlett-Packard acquisition

Organizational Diagnosis of Palm

Palm Computing had reinvented the hand held computer market overnight with the line of PalmPilot and similar devices geared to the mobile gadget industry. According to Clancy (1999), "Palm Computing ultimately sold faster than the videocassette recorder, the color TV, the cell phone, even the personal computer that was its great-grandfather. Introduced in April 1996, within 18 months Palm Computing had shipped more than 1 million units of the handheld and some estimate there were 2 million Palm devices shipped in 1998 alone." (Clancy, 1999)

Such incredible demand for Palm Computing's products were a function of the brilliant and innovative management and design team that launched and built the company. The two prominent executives of the company, responsible for developing product and marketing, and product releases, were Jeff Hawkins and Donna Dubinsky.

According to Clancy (1999), "In Hawkins, Silicon Valley has one of its most independent, original thinkers. And in Dubinsky, it claims one of its most methodical, thorough managers. Add a dash of Ed Colligan, the energetic marketing force behind first Palm Computing and now Handspring and you have Silicon Valley's version of what is known in Broadway theatres as a triple threat." (Clancy, 1999)

The maker of handheld mobile computing had a quandary on its hands as its leadership was departing for other ventures. Hence, Palm was a clear target for a merger. Hewlett Packard buys Palm and enables the company to run as a unit within the HP operation. The organization dynamic for Palm at this junction requires re-examination within the framework of prevailing organization development theory. [1: http://www.itbusinessedge.com/cm/blogs/enderle/hp-and-palm-the-explosion-that-will-rock-the-computer-industry/?cs=40968]

The Nadler-Tushman Congruence Model

The Nadler-Tushman Congruence Model for Organization Analysis outlines an integrated network, "specifying inputs, throughputs, and outputs, which is consistent with open systems theory (Katz & Kahn, 1978)." (Leadersphere, 2008) The model, as is the same with all organizational diagnostic models, is based on a set of assumptions with regard to the framework of the environment. According to Leadersphere (2008), these assumptions are listed below. [2: http://www.leadersphere.com/img/OrgmodelsR2009.pdf]

Organizations are open social systems within a larger environment

Organizations are dynamic entities (i.e., change is possible and occurs)

Organizational behaviour occurs at the individual, the group, and the systems level

Interactions occur between the individual, group, and systems levels of organizational behaviour.

Source: http://www.leadersphere.com/img/OrgmodelsR2009.pdf

The variables sought to be inputs for analysis by this model include the "patterns of past behaviour" (Leadersphere, 2008) and strategies engaged by the organization, which includes how resources are expended to meet organizational goals and objectives within a hostile external environment. The inputs include the "environment, resources, history, and strategy. The environment is all factors, including institutions, groups, individuals, events, and so on, that are outside the organization being analyzed, but that have a potential impact on the organization." (Leadersphere, 2008)

The resources are the tangible and intangible assets the organization has under management. The history includes the effective behaviour in activity, its effectiveness relative to past performance, and how the organization based on past behavioural patterns will fare in the future. The throughputs include the actual work of the organization, such as task management in the service or hospitality industry and customer service management. The individual component is the potential for innovation and development, and profitability of effort. The formal organizational arrangements include the "various structures, processes, methods, and so on that are formally created to get individuals to perform tasks." (Leadersphere, 2008) The informal organization includes organizational structures, their internal processes and external result, and the B2B, B2C relationship.

The outputs of individual behaviour, group and intergroup behaviour, and system functioning, and affect include the universe of possibilities that include adverse decision-making affecting one's ability to perform profitably for the organization.

"Nadler and Tushman (1980) describe congruence, or fit, as "the degree to which the needs, demands, goals, objective, and/or structures of one component are consistent with the needs, demands, goals, objectives, and/or structures of another component" (Nadler and Tushman, 1980). The weakness of this model is that one must clearly define the organization before the parameters of the model. The model also is static and not dynamic in its ability to adjust to a quickly changing modern economy.

The Organizational Intelligence Model

The organizational Intelligence Model is the newest organizational diagnostic model in the organizational development theory field. According to Leadersphere (2008), The model was developed to "drive employee engagement and performance." (Falletta, 2004) "The Organizational Intelligence Model can serve as a diagnostic framework for OD purposes as well to facilitate the design and interpretation of most employee and organization survey efforts." (Leadershpere, 2008) [6: http://www.leadersphere.com/img/OrgmodelsR2009.pdf]

This model views the organization as a holistic and globally integrated entity with human resource capital engages in strategic positions throughout the operational environment. Eleven critical areas are addressed under the model. Most of the components are similar to the other models, and even include additional components that serve to buttress the analysis of the variables within the nexus of integrated components. Qualitative and Quantitative assessments are used within this analysis, which can be a positive or negative aspect of the model depending on the ability of the organization to utilize the effectiveness of the model.

According to Leadersphere (2008), "While the Organizational Intelligence Model is similar to the B-L model in many respects, it differs in the following ways." (Leadersphere, 2008)

The Organizational Intelligence Model depicts and emphasizes the notion of employee engagement which goes beyond employee motivation and commitment.

The Organization Intelligence Model depicts and emphasizes growth and development as a key factor for engaging and retaining talent.

The Organizational Intelligence Model has been tested in a number of settings with respect to validity and reliability vis-a-vis factor analysis and causal modelling procedures.

Source: http://www.leadersphere.com/img/OrgmodelsR2009.pdf

Force Field Analysis [7: http://www.leadersphere.com/img/OrgmodelsR2009.pdf]

The early 1950s saw a practical theoretical approach to organizational diagnosis in the form of Lewin's Force Field Analysis (French & Bell, 1995; Fuqua & Kurpius, 1993; Lewin, 1951). This framework is ostensibly a modern form of a contemporary macro strategic planning approach that is intended to place an internal SWOT analysis to an external SWOT analysis in a sort of Venn Diagram to determine negative and positive overlap. Additionally, this approach determines where the opportunity through value is internally and externally and can maximize intrinsic value relative to the external environment.

According to Lewin et al. (1951), "The model relies upon the change process, with the social implications built into the model (e.g., disequilibrium is expected to occur until equilibrium is re-established). The general goal of this model is to intentionally move to a desirable state of equilibrium by adding driving forces, where important, and eliminating restraining forces, where appropriate. These changes are thought to occur simultaneously within the dynamic organization." (Lewin, 1951) The weakness in this model is within the leadership that must execute in an environment based on uncertainty and essentially on the insight and vision of leadership. The quality of the environmental factor analysis is also critical, as this information must be as accurate as possible.

Tichy's Technical Political Cultural (TPC) Framework [8: http://www.leadersphere.com/img/OrgmodelsR2009.pdf]

Tichy's framework (Tichy, 1983) is essentially a change management process (Tichy, 1983) that organizes ordinal data including the "inputs, throughputs, and outputs" (Tichy, 1983). The categories where the input is drawn include the environment and the history, with a third category included as resources. Throughput variables are defined as the actuators or change drivers in the model. The identified change drivers include, "mission/strategy, tasks, prescribed networks, people, organizational processes, and emergent networks." (Tichy, 1983)

Prominent to the functioning of the model is the mission/strategy variable, which inherently defines the purpose of the organization's existence. The tasks variable captures the technological aspect of the organization's approach to the work-flow process. The prescribed networks is the hierarchy of the organizational structure, essentially the chain-of-command as a function of the communication between departments and the relationship between departmental authorities and their reports. According to Tischy (1983), "The focal point of Tichy's model is the output variable, which he terms organizational effectiveness. Of course, the output is dependant upon the input and throughput variables. All of the variables, including the input and output categories, are considered to be interrelated in the model. While some variables have a strong impact on other variables, other variables have a weaker, or reciprocal, relationship on other variables." (Tischy, 1983) The weakness of this model is its complexity in operationalizing the political problems within the organization into variables to be measured. Additionally, the problems that arise with potential multicollinear data can make the model useless. A skilled management team must undertake the approach for the model to have any potential benefit.

Problems facing Palm Computing

Palm's relatively strong early performance would ironically not be the perceived harbinger of fortune that one would originally have predicted for the long-term success for the organization. Throughout the history of Palm, the organization has been bought and sold an inordinate number of times, which perceivably causes internal chaos and leaves a message of uncertainty to the investing and technologically savvy communities.

The consistent turnover of leadership within the organization left the company with an uncertain direction and a very uncertain future. A radical change to how Palm approached the market was needed, which would come mid decade, 2000. According to Niccolai & Gohring (2010) "Todd Bradley steps down as CEO of PalmOne and Ed Colligan takes over. PalmOne acquires the Palm brand name, paying PalmSource $30 million for its 55% share of the Palm Trademark Holding Company. 2009 -- Colligan, the last remaining funder of Palm, leaves the company. Jon Rubinstein, known for his role designing the iPod for Apple, becomes CEO. March -- 2010 Palm reports a loss for its most recent quarter of $22 million, and says its "recent underperformance has been very disappointing." Rumors surface that the company is up for sale." (Leadersphere, 2008)

The Best Model:

The optimal model for use is the Organizational Intelligence Model as it incorporates research methodology to isolate environmental variables as well as seeks to understand internal variables in an effort to operationalize these constructs into operational definitions. The other models do not address this methodology in such a detailed and direct manner. The quantitative and qualitative analysis is succinct and clear within this model, which is ostensibly a function of the earlier organizational diagnostic models.

Recommendation:

The real issue with Palm is it has been mired in lacklustre leadership since its inception. Aside from the accolades bestowed onto its initial executive leadership, the organization has not been able to grow on its vision and initial line of breakthrough web communications products. A sign that the company is in deep trouble is the resignation of the last remaining executive that was a part of the founding team. The organizational diagnosis for Palm is focused around its mission, vision, and strategy.

The Organizational Intelligence Model is the recommended model to dissect the organizational model into stratified parts that can then be examined more intensely. The organizational resources are only functional when a clear and executable strategy is sought and is supported with sufficient capital from financing sources, enabling the company to use its assets t increase its interest income. The environment in which Palm operates has become increasingly competitive since the days of its inception. A supposed 'great idea' from the current CEO may not be the panacea envisioned when first conjured.