Decision making

The board of directors has recently appointed Authur Mabuso as the new Chief Executive Officer. Arthur has a reputation for leading successful organisational transformations from his previous appointments in other companies. His leadership is predominantly transformational, characterised by his strong vision, inspirational communication and focus on employee development. He believes in creating a culture of innovation, empowerment and accountability.

Upon joining PCL, Arthur conducted a comprehensive analysis of the company’s operations, market position and employee satisfaction. The following issues were identified: 

Arthur’s first major initiative was to launch a company-wide transformation programme dubbed “PCL revamped”, aimed at revitalising the company’s culture, processes and market research. The programme includes the following components: 

However, Arthur faces the following challenges in implementing “PCL revamped”: 

Within the first six months, PCL revamped has shown promising results. Early innovations from the hubs have led to the development of two new product lines which are yet to be launched into the market. Employee engagement scores have improved and there is a noticeable increase in collaboration across departments. However, some resistance remains and Arthur is working on addressing these issues through continued communication and support. 

(a) Explain FIVE objectives of innovation hubs in the context of “PCL revamped”. 

(b) Suggest FOUR potential strategies that Arthur could use to overcome resistance to change among the long standing employees. 

(c) Analyse FOUR potential long-term impacts of the “PCL revamped” programme on the company’s culture and market position. 

(d) Evaluate THREE roles of leadership development in the success of “PCL revamped”. 

(e) Discuss THREE roles of client feedback in enhancing PCL’s service quality and client relationship. 

(f) Explain THREE differences between “strategic goals” and “operational goals” in the context of PCL. 

(g) Highlight FOUR ways in which the Chief Executive Officer may address the challenge of balancing short-term operational needs with long-term strategic goals. 

(h) Advise the Chief Executive Officer and his team on FIVE alternative pricing strategies that the company could adopt when introducing the new products.  

Before Harold, the only other president of HTEL was the founder and owner of the company, Mark Lewis. Mark stepped down from the leadership of HTEL after reaching retirement age in accordance with the company’s policies. During his tenure, HTEL was bureaucratic and had a traditional and rigid organisational structure. Mark made most of the strategic decisions many times overstepping his Board of Directors. Despite his style of management, the company had a very rich hierarchical organisational culture.

After taking over from Mark Lewis, Harold embarked on transformation of HTEL to a modern company. He believed in involving employees in decision making as much as possible. Though he was a people’s person, Mark seemed not to have the right skills mix required of a Chief Executive Officer (CEO) of HTEL. He was however convinced that new technologies and advanced management techniques could make HTEL one of the best manufacturing companies in the country. To this end, Harold created a vision statement that was displayed throughout the company. The two page statement which had a strong democratic tone, described the overall purpose, direction and values of the company. 

During the first three years of Harold’s tenure as president, a major process re-engineering took place at the company. This was designed by Harold and selected few of his senior managers with the help of some consultants. The consultancy firm was not competitively sourced and had done no similar work before. One of the intentions of the re engineering process was to implement an advanced organisational structure to facilitate achievement of the new HTEL vision. Drastic Changes were made in the organisation. These changes affected all members of staff and how they worked. As part of the changes, the organisation structure was flattened and some offices merged. Some of the changes gave employees more control but less in some instances, where employees should have been given more power. There were some situations in which individual workers reported to three different bosses and other situations in which one manager had far too many workers to oversee.

Rather than feeling comfortable in their various roles at HTEL, some employees began to feel uncertain about their responsibilities and how they contributed to stated goals and vision of the company. Though the CEO had good intentions for the company, the re-engineering process did more harm than good. The overall effect was a precipitous drop in worker morale and productivity. In the midst of all the changes, the vision that Harold had for the company was lost. The instability that employees felt made it difficult for them to support the company’s vision. Employees at HTEL complained that although the mission statement was displayed throughout the company, no one understood the direction the company was going. 

To the employees at HTEL, Harold was an enigma. Harold claimed to be democratic in his style of leadership, but he was arbitrary on how he treated people. He acted in a non-directive style towards some people and he showed arbitrary control towards others. He wanted to be seen as a hands-on CEO, but he delegated operational control of the company to others while he focused on external customer relations and matters of the board of directors. At times, Harold appeared to be insensitive to employees’ concerns. He wanted HTEL to be an environment in which everyone could feel empowered, but he often failed to listen closely to what employees were saying. He seldom engaged in open, two way communication. HTEL had a long, rich history with many unique stories, but the employees felt that Harold either misunderstood or did not care about that history. Four years after arriving at HTEL, Harold stepped down as president after his operations officer ran the company into a large debt and cash flow crisis. His dream of building HTEL into a world-class manufacturing company was never realised.  

(a) Harold Barelli believed to possess a certain leadership style. Drawing evidence from the case study, discuss FIVE characteristics of this leadership style. 

(b) Examine FIVE drawbacks to HTEL from its wide span of control.

(c) For each function of management, explain Harold Barelli’s inadequacies. 

(d) Harold Barelli failed as a leader, resulting to his stepping down as the president of HTEL. Discuss FIVE skills that Harold Barelli would have acquired, in order for him to become an effective leader. 

The two were involved in the day to day running of their company though they were board members. Peter was the chairman of the board of directors while Patrick was the chief executive officer (CEO). Patrick was responsible for operations in the company, Peter was responsible for leadership, marketing and human resource in addition to carrying out the chairman’s role. This at times brought about confusion in the company leading to bad decisions.

Due to the complexities associated with the shift from partnership to a company and the confusion in decision making, MWRPL hired the services of Mamlaka Management Consultancy (MMC) to assist in establishing working structures and recruitment of relevant key personnel. Before the consultants came on board, the business had a workforce of 67 employees, a few working on permanent basis while majority were engaged on temporary contracts. 

The Consultants analysed the defunct partnership business to establish strengths and weaknesses and recommended a divisional structure. They also advised that all the employees who were retained by the business after conversion into a company for them to change their mindset. MMC also recommended to MWRPL to recruit new employees in order to fill identified skills gap. The consultants insisted that the staff recruited be apt in intuition, technology, data collection, analysis and dissemination of information to ensure decisions in the company were mainly arrived at scientifically. The new employees were to focus on both internal and external matters affecting the company. 

The company’s main objective as stated in its Memorandum of Association was to offer wood and roofing products in the country. MWRPL segmented its market by offering tailor made solutions to two classes of customers; furniture for home owners and roof construction for the construction industry. The company adopted diverse marketing as its primary marketing strategy. 

Most of the company’s operations took a job shop approach. For each segment, the company worked on one project at a time before moving to the next project. Project scheduling skills were necessary to the production managers so as to ensure customer orders were completed on time. This ensured high levels of customer satisfaction.

To continuously improve the quality of its products, MWRPL invested heavily in technology and customer service. A slogan was devised and circulated “think and delight the customer”. Improved quality of its products and services has resulted into lowering of the production cost. As compared to the competitors, the market now prefers MWRPL’s products due to quality and affordability. 

The company diversified its services to capture new customers and markets. In year 2021 and after carrying out an environmental analysis, MWRPL noted an opportunity through its research and marketing department and included solar appliances in its products offering. This targeted low-income earners in rural areas who were not connected to the national electricity power grid. 

By mid-2022, the demand for the wood products and roofing services had exponentially expanded with the company’s clientele being spread in all the 47 counties in the country. MWRPL has since expanded its operations and services and has opened branches in all East African Countries. The company has future plans of opening branches in West African countries. 

(a) Explain why the following are important to MWRPL: 

     (i) Internal analysis. 

    (ii) External analysis. 

(b) The County Chamber of Commerce assisted its members in generating business ideas. Discuss FIVE techniques that could have been used by the members to generate business ideas. 

(c) Analyse FIVE characteristics of the organisational structure recommended by Mamlaka Management Consultancy (MMC). 

(d) Despite being board members, Peter and Patrick were involved in the day to day running of their company leading to bad decisions. With reference to the above statement, analyse FOUR inhibitors to effective decision making. 

(e) MWRPL adopted diverse marketing as its primary marketing strategy. Propose to MWRPL, SEVEN strategies that they could use while developing a diverse marketing campaign. 

(f) MWRPL’s production managers were expected to possess project scheduling skills in order for them to be effective. Highlight SIX contents they could have included in their project schedules.     

The company manufactures most of the appliances centrally in India and then ships them directly to its global markets. At the initial stages of establishment, MCL collaborated with technical institutes to train technologists who assembled and maintained the appliances. The company’s after-sale service approach has boosted its customer base globally. Any major repair was referred back to New Delhi.

In the year 2013, MCL hired a business analyst to carry out a worldwide business analysis with the aim of identifying countries where new offices could be set up. This decision would be based on a wide variety of factors. Globally, MCL customers were classified according to geographical regions. Africa region was the largest, with MCL present in five countries. The company had enjoyed monopoly status in the countries where it operated for a long period of time. 

From the year 2018, competition has been building up where some companies have been able to offer more advanced and better products. This has led to MCL’s bottom line being impacted adversely. The competitors’ products are imported as a complete portable set, and do not require local assembly. The marketing model used by competitors borrows heavily on multi-level marketing and therefore embraced by MCL customers. Perception associated with companies such as MCL which sell in large quantities undermines quality selling. The competitors introduced new modes of selling including hire purchase and loaning for the appliances. These modes were quickly adopted by customers. 

Peter Quick joined MCL in the year 2020 as the head of sales, Africa region, at a time competition was very stiff and the financial position of the company was very low. Major customers that had remained loyal to MCL were shifting their loyalty. By the year 2021 the competition grew exponentially as new entrants joined in with cheaper and more technologically advanced appliances.

Khan Ho, the global operations general manager, whose office is in New Delhi, planned for a brainstorming workshop in the year 2022 for all the regional sales heads to advise on the way forward. The regional sales managers were required to provide scientific responses to the problem, guided by facts and the unique challenges in each of their regions. Khan Ho expected that the workshop would yield remedies to the effects of fierce competition and the way forward would be arrived at. 

In preparation for the workshop, Peter Quick and his team carried out an in-depth internal and external analysis of MCL, studied the competitors’ strengths, customers behaviour, market volatility, competitors and products differentiation. In the analysis, it was undisputable that some of MCL’s appliances were unique and effective in the market. 

To enable him understand the reasons behind the customers shift in loyalty, Peter Quick purchased some of the competitors’ products and shipped them to the company’s main laboratories in India for detailed analysis of their constituent parts. The laboratory report revealed that 70% of the competitors’ products comprised of MCL’s products components. The only major differentiating factor was the logo, colour and packaging. Most of the competitors were buying MCL’s products, adding on a few improvements, re-branding, packaging and selling the products in the market as their own. 

In his presentation, Peter Quick noted that the assignment was complex and weighty. To enable him have a logical presentation during the workshop, he classified his findings in the following categories: marketing strategies, production and operations, human resource, ethics and morals, and legal issues. 

The workshop recommended certain measures to be undertaken. These measures included: • To broaden the customer base • Top management to implement e-marketing strategy 

By the beginning of this year, the company’s bottom line had started showing a positive increase. Customers were trickling back in and it is expected that by the end of the year, the company will have regained its lost market share. 

(a) Discuss THREE possible reasons why MCL engaged the services of a business analyst. 

(b) Evaluate FOUR internal factors that could have played part in impacting on MCL’s bottom-line.

(c) Examine FOUR ways in which MCL could apply Michael Porter’s generic competitive strategies to regain its competitive advantage. 

(d) (i) Identify the leadership style applied by Khan Ho in the case. 

     (ii) Analyse FOUR characteristics of the leadership style applied by Khan Ho in (d) (i) above. 

(e) (i) Explain the type of thinking that Peter Quick used, to address the problem. 

     (ii) Analyse FOUR steps followed in the thinking process described in (e) (i) above. 

In the year 2015, the company fully acquired Brillers Agencies Limited (BAL) which operated in the same area with DCL. The Board of DCL however resolved that the two companies would operate independently and some members of the Board of DCL would sit in the Board of BAL.

Due to his vast experience and successes, the Board of DCL appointed James Shark as the chairman of the newly reconstituted Board of BAL, an added responsibility to that of the CEO’s position at DCL. The Board also appointed Engineer Rebecca Ayoo as the Chief Executive Officer (CEO) of BAL. Her rich corporate leadership experience enabled her to spearhead transformative changes in the entire organisation. Within a short period of time, manual processes had been automated and data held in old files digitised. BAL opened four more regional branches and restructured processes to make the company more efficient. 

Based on her experience in the water sector, Engineer Rebecca Ayoo recommended to the Board that the company carries out a national study to establish the actual demand for its services based on its strengths and weaknesses. This was to inform further strategic decision making. Vertex Researchers and Consultants (VRC) were hired to carry out the study. When the full report was presented to the Board of Directors, majority of board members were excited, but the chairman, James Shark was hesitant and gave a directive that further analysis be done on every recommendation. The study revealed that there was great demand for services such as waste management, sewerage networks and water supply in major towns in the country since most county governments were not able to meet the high demand for the growing numbers of residents especially in urban areas. The consultants in their report had included a detailed risk assessment matrix, cost benefit analysis, human capital requirements, market demand forecast and proposed implementation strategy for each project.

Another report was presented in a Board meeting six months later and the Board recommended the implementation of the projects in phases based on risk factors and return on investment (ROI) of every project. The chairman was cautious and advised that the company should implement one project at a time. He argued that each project should be given reasonable time before embarking on another one. According to him, every project was to be treated as a cost-centre. He further advised against expanding the company’s operations outside its core mandate irrespective of the projected returns. VRC was again engaged to oversee the implementation of the first project. This project included drilling of boreholes in five major towns and distribution of water trucks. The service proved to be very profitable. 

Two years after the retirement of James Shark as the Chair of the DCL Board, his predecessor Alex Kim whose risk appetite was higher than that of James Shark convinced the Board to implement all the other projects recommended in both reports. He was able to convince both the Boards of BAL and DCL, the parent company’s Board (where he also sat as a director), to extend BAL’s operations in two other regions of Africa. This resulted in the opening of regional offices in West Africa and South Africa. In these two regions, the company operated as Global Drillers Company Limited (GDCL). Engineer Rebecca was against this aggressive move and insisted that the company should remain focused on its core mandate. She was however overruled by her Board. Some Board members started frustrating her efforts at BAL leading to her resignation as CEO of the company.

Last year most counties restructured their services including water supply and waste management. This affected the company’s bottom-line negatively that the company could not sustain its branches in the country nor the high number of employees. All the branches outside the country were also struggling to break-even.

Alex Kim has called for a brainstorming meeting for Board of Directors and Management to address the challenges with a view of re-engineering the company’s processes.

(a) State FIVE political factors that Drillers Company Limited (DCL should consider when planning expansion of its operations. 

(b) Discuss FIVE steps that Engineer Rebecca Ayoo could have followed to institute changes at BAL.

(c) Vertex Researchers and Consultants in their report to the Board of BAL had included a detailed risk assessment matrix for each project. Examine FIVE benefits that would accrue to BAL from the preparation of a risk assessment matrix.

(d) Propose FIVE possible hurdles which BAL was expected to overcome as the business expanded to other regions in Africa.

(e) Assuming that you are a Board member of BAL, prepare a FIVE point memoranda in support of Alex Kim’s idea of re-engineering the company’s processes.