This paper is a case analysis in an organizational design course. The case problem is identified. The case is analyzed in terms of the different problems that exist that have led to the current dysfunction. Alternatives are presented to resolve the issue, from an org design perspective, and then a recommendation is made.
Team Development
The macro level problem is that there is no coordinated, integrated approach to product development. Structurally, the task of identifying opportunities, developing products and then developing manufacturing capabilities is split among several units. This is a major issue because it causes conflict among the different units, and it likely reduces the company's ability to respond to opportunities as well.
On a micro level, there are a number of issues. The first is that there is no real coordination between the different units. The left hand does not know what the right hand is doing. This is sloppy for dealing with customers and a real problem when dealing internally as well because of the conflict that it creates. Several people have identified this problem, yet there is no leadership of product development. The person in charge of this is the Administrative Vice President and they are nowhere to be found here. Further, there do not appear to be any formal mechanisms for communication between the different units. This leads to turf wars, mistrust, and again it inhibits innovation as well.
2. Causes
The main causes of these problems stems from a) a lack of leadership but more importantly b) an organizational structure that creates this formal divisions and power structures that divide these different units when their common objectives clearly indicate that they should be working closely together.
3. Systems Affected
a. The structural system affected is the new product development system. Where the different functions (product development, engineering and marketing) should all work together on this, they currently do not, to the detriment of product development.
b. Psychological issues here revolve around ego and turf-defending. Marketing in particular has turf-defending grievances when product development staff talk to customers, for example. The other units have these sorts of turf and ego issues as well, because they all see the other units as a threat to their own contribution to the company, an entirely unhealthy attitude -- a bad form of internal competition.
c. From a technical perspective, this issue is problematic because the products are development more with technical needs in mind, rather than customer needs. There is some customer input, but perhaps too much emphasis on "what can be produce" instead of "what does the customer need."
d. From a managerial perspective, the lack of coordination is more a cause than a symptom. The company needs leadership that is capable of managing the innovation process, but instead has these three units that are not working together. The Administrative Vice President is not managing the innovation process effectively it would seem.
e. The goals of the company are not stated, but one can assume that revenue, growth, market share, profits and the introduction of successful new products are all important measures. The current dysfunction in product development is probably inhibiting most of these, because the products are not being developed with a strong market focus, but also the marketing department receives products that they have no investment in. While we cannot prove the performance would be better with a different product development system, it is logical that it would.
4. Alternatives
The current system is the default, so that is the first option. It is not working all that well, but it must be doing something right. The second alternative is to focus on building stronger channels of communication between the different divisions as a method of improving the coordination of new product development. Each division came about for a good reason, so this approach maintains the strength of each division while tackling the communications problems. The third alternative is to unwind these three different units. Product development instead will be conducted with multidisciplinary teams, using talent from marketing, engineering and new product develop on a project basis. Such an approach is expected to be more successful because it gives every department a stake on new product development.
You’re 84% through this paper. Sign up to read the full paper.
Sign Up Now — Instant Access Already a member? Log inAlways verify citation format against your institution’s current style guide requirements.