April 2024

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.