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Merger Challenge: Unite Toothbrush, Toothpaste May 8, 2007

Posted by Brian Mulligan in Merger, Organizational Culture, Organizational Environment.

The article that I found in the Wall Street Journal titled, “Merger Challenge: Unite Toothbrush, Toothpaste – P&G and Gillette Find Creating Synergy Can Be Harder Than It Looks directly relates to company culture conflict. Many thought that the merger of the world’s No.1 toothbrush and the world’s No. 2 toothpaste would provde to be a match made in heaven.

The rosy picture painted by most anaylsts turned completely grey once the companies actually tried to merge together. Oral-B employees were forced to move from Boston to Crest’s Cincinnati hom office, while there was a clash of management style. Oral-B favored meeting while Crest liked memos. In contrast, Crest liked deliberated moves while Oral-B liked quick decisions.

“Gillete staffers had to learn to cope with P&G’s famously rigid culture”

In th end, both companies have to deal with all of the problems that they are having with each other. How do you propose a compromise? What is the best solution?


The Workplace May 1, 2007

Posted by wilson7 in Employees, Organizational Environment, Workplaces.

Do you think the way an office is set up has a direct correlation to employee moral, productivity, and job satisfaction? An April 2006 survey of more than 2,000 office workers commissioned by Gensler, a leading design firm, illustrates both the problems and the promise of workplace design. Nearly half of the respondents said they would work an extra hour a day if they had a better workplace environment. More than 90 percent reported that their office space affected their attitudes about work and that a different setup could make their companies more competitive. Yet employers seemed blind to the potential: Only 38 percent of workers said they would be proud to show important customers their workspace. About a third complained that it didn’t promote health and well-being. And almost half thought that creating a productive workplace was not a priority at their companies. It was a study by the Buffalo Organization for Social and Technological Innovation, that showed how the physical design of workspace had a direct effect on job satisfaction, productivity, and profitability in settings ranging from high-rises to laboratories. Companies with workplaces that encouraged more informal mingling of employees, for example, outperformed those that sequestered their staffs in amaze of cubicles.

General Services Administration decades ago: Of the total cost to a company for running an office building over a 30-year life span, the initial construction represents just 2 percent; operating expenses come to about 6 percent.

The remainder goes to paying the workers inside. The point should be obvious: People are the biggest cost inside a work environment, so leveraging your human capital ought to be near the top of your priority list. But, of course, it isn’t. What type of work environment would you like to be apart of? Are you a cubicle type of employee or more interactive?  If you were an employer what type of office would you set up?

The Informant April 11, 2007

Posted by Kira in Class announcements, Organizational Design, Organizational Environment.
1 comment so far

As I was reading my book for the project, I found a part that relates to my last blog entry.  In my last blog, I discussed a little bit about the Japanese culture or style of doing business.  I discussed how corporate takeovers used to be rare because of the deep cultural aversion to selling one’s company and how this was considered a humiliating failure by the founders and owners.  I also mentioned how there is also a cultural aversion to confrontation.  In the book The Informant, the main company ADM is involved in price-fixing with Japanese companies.  At one of their secret price-fixing meetings, the book describes a variation of a classic Japanese negotiating strategy known as “naniwabushi.”  The book states that “in Tokyo, the method is effective in resolving disputes without confrontation” (195).  I thought that this parallel was interesting.  The Japanese have maintained their strategy and culture of avoiding confrontation that was used in the price-fixing negotiations up until now in the recent article I read.  

I am half way through the book- it moves pretty quickly.  There are so many different characters and detailed conversations that take place in the book that it is hard to remember it all and keep it all straight!  I can’t believe that this investigation is a true story- how does so much illegal activity take place and be kept so quiet?  I guess that is where the organizational structure and culture come into play.

I think for our project just focusing on what is going on inside ADM, the main company, which allows for all of the illegal activity, is the best approach.  I think it may be interesting to try and set up an organizational chart for the company- it seems as though it would be very fragmented and would have bad flows of information between employees and product divisions.  Do you think it would be interesting to try and provide a recommendation for the company on how to fix their structure and maybe even design a new organization chart?  Do you think we should focus on the organization of ADM or the FBI?  The main character is also very interesting and complex- do you think we should deal with him also?  Maybe relate his actions to business ethics and how the organization of ADM allowed for his actions to take place?

Sorry it is kind of hard to understand this blog unless you have read the book- I don’t want to give too much away on here though!    

Forces of change for strip clubs April 10, 2007

Posted by Lady in Business-Society Issues, Consumers, Employees, Government, Organizational Environment.

I read an article from The Enquirer entitled, “New rules for strip clubs?: Tough new laws could go on Ohio’s ballot.” Basically the article discusses how a group called Citizens for Community Values is putting pressure on Ohio state legislators to pass a Community Defense act which would put restrictions on how strip clubs run their organization. Nude dancing would be banned after midnight and before 6 a.m. In addition, customers would not be allowed to get within six feet of a dancer. Violation of these laws would lead to $1,000 fine and jail time.  

Supporters of the enactment of this law are seeking legislator’s approval because it makes the petition process go a lot faster. However, some people, such as strip club owners, are not in favor of this legislation. So I’d like to post my blog on how strip clubs function as organizations and how forces of change might affect their business. So I was able to point out social forces such as demands from some citizens to tighten their rules in the strip clubs. These citizens feel as though strip clubs have negative effects on the community, such as promoting prostitution and lowering property values.


Another social concern that I thought of was the fact that many of the dancers who work in the strip clubs end up living a corrupted life. In a sense, strip clubs ruin some girls’ lives by promoting promiscuous behaviors. Might some political forces of change also be involved with this situation since legislation is involved? Brian Rothenberg, executive director of a liberal activist group called ProgressOhio, said it is possible that the decision on the legislation could get pushed to 2008 “to drive up turnout for the presidential election.”

What do you guys think of this issue? Should this legislation be passed? Do these strip clubs have a moral obligation to consider to effects that they have on the community including the dancers who work in the strip clubs? Or should the government stay out of this issue because the strip clubs are just providing a service which is highly demanded and helps to also create jobs for these dancers? Do you think that strip clubs will be able to resistance these forces of change?

Siemens Executive Arrested March 28, 2007

Posted by silviamocanu07 in Business-Society Issues, Organizational Environment.

     Johannes Feldmayer, one of Siemens’ top executives, was arrested and is suspected of having used company funds to influence the result of its negotiations with IG Metall, Germany’s largest industrial union. Siemens, Europe’s largest engineering firm, is negotiating an increase in workers’ wages with the union. IG Metall is requesting a 6.5% increase, while Siemens is only willing to match half of that percentage. Feldmeyer is thought to have been wrongfully directing company funds to a consulting firm which works with the labor union. Siemens is also undergoing a separate investigation by authorities, as it is believed that the top management of the company has paid millions of Euros for fake consulting contracts, and actually used the money in order to bribe potential customers abroad. The company’s response to the investigations was to cooperate with the authorities, to place stricter internal financial controls, as well as to seek outside legal advice in order to address this situation.

    It is hard to imagine that top executives in such a reputable organization are capable of such unethical and blatantly illegal behavior. One of the main reasonings behind such actions would probably be the desire to reduce labor costs, which can become quite substantial, particularly in a country such as Germany, where labor unions are very strong and hold significant bargaining power with employers.  This is a clear instance of the external environment directly influencing the company’s costs. Do you think that the charges against Feldmayer are justified? What do you think would drive a high-up executive to such actions?

Link to the article: http://online.wsj.com/article/SB117500626744850396.html?mod=home_whats_news_europe

A Saab’s Story March 27, 2007

Posted by Kira in Auto's, brand, Consumers, Marketing, Organizational Environment, outsourcing, Retail.

Saab was faced with the challenge of expanding its market to mid-size sports wagon drivers in the U.K. To accomplish this, Saab had to overcome two major disadvantages. Not only was their marketing budget smaller than their competitors but, their brand recognition and reputation was smaller as well. To promote the 9-3 SportWagon, Saab created a two-part campaign that combined direct mail and the internet. The campaign was a game called “The Race Against Time.” This campaign included a 100-page “choose your own adventure” book that was mailed to people who inquired about the car. The book put its readers in a Saab 9-3 and dared them to see if they could reach a weekend destination without falling into trouble. The story moved forward by choosing from optional actions listed on each page which all led to a different set of circumstances. The game was also offered online- so people could sign up for the game and for additional information about Saab. By playing online, the players could e-mail their results to a friend and challenge them to beat their time. Participants could also record their personal progress. As an incentive, participants who won the challenges were eligible to win a Saab 9-3 Aero V6 SportWagon and Saab-branded sports merchandise. Although Saab officials assumed that no more than 5,000 people would participate in the campaign, more than 29,000 people signed up to play online with 40% also signing up to receive electronic news updates from Saab. The game was also placed on other websites and on blogs (go figure!). Sales for the 9-3 rose in Great Britain from 2,000 cars sold in 2005 to more than 6,000 in 2006.

“We got a set of people who never would have considered Saab,” says Ed Birth, the Saab account manager for Draftfcb (Draftfcb created the campaign)

Saab’s campaign is an example of a recent trend in which marketers are targeting consumers enticing them to play games and activities in order to get them to spend more time with the brands. The longer the time spent with the product the more likely the brand will come to mind when making a future purchase.

Last class we were discussing survival strategies. I would say that Saab is a k-specialist- they had to break into an established market for sport wagons. Some of the reasons that Saab was probably successful as a k-specialist were because they already knew that a market for sport wagons in the U.K. existed and that games and activities were a marketing success. They were able to see trends in the existing companies in the sport wagon market that they could “mimic” and allowed them to see the correct way they could compete.

By using direct mail, online websites, and blogs, Saab was able to reach different potential consumers. The use of online websites allowed Saab to capture younger consumers while also capturing the names and e-mail addresses of potential consumers who registered. This could allow Saab to generate a database for future marketing tactics. Also, the game was a great way to tap into consumers’ emotions- I know it made me reminisce about the “Choose Your Own Adventure” book that I had when I was younger!


I think the game can still be played online- check it out for yourself!

Walmart vs. Weis March 21, 2007

Posted by Janine in Consumers, Organizational Environment, Retail.

As many of you now know, the new Walmart supercenter has opened. While I have not yet gone there to check it out, I have heard a lot about it. Many that I have talked to do not seem to be that impressed with its layout, while some are marveling at its wide and cheap selection. You can literally go there for just about anything, from food, to clothes, to electronics. It is one-stop shopping at its finest.

This got me thinking: what is the Walmart’s opening going to do for other local businesses? Weis markets will be taking a huge loss with the giant’s cheaper food and beverage selection. Also, with the new garden center, places like Loews and small, privately-owned businesses are sure to feel the effects of Walmart’s persuasive low prices.

Some I have talked to have said that they are going to remain loyal to the businesses such as Weis. Those people have told me that they just “don’t feel right buying produce and fruits from a store like Walmart.” I see their point. Will quality be jeopardized for the sake of low costs?

Now, I have never really been to a Walmart superstore, but I can imagine the satisfaction one can get knowing that they only have to stop one place to get their groceries and misc items. But, what about the others. This means that businesses like Weis, Ards, Giant, etc. will have to reorganize, regroup, and devise ways to react to this environmental change. The environment surrounding these businesses has changed, and I am very curious to see how each one of them responds.

I have heard talk that Weis owns the lot that the old Walmart was on, and the company plans to expand the current Weis. That could be in the future. I think the smart way for a place like Weis to react to this opening is for them to go above and beyond their competitor; they should open a more extensive organic and health food section, bring in other services, such as a drycleaners. The possibilities are there, so in the next few months or years, I look forward to seeing what develops.

Can YouTube resist organizational change? March 19, 2007

Posted by Lady in brand, Consumers, Internet, monopoly, Organizational Environment, sustainable development.

I recently read an article entitled, “YouTube struggles despite dominance” which discussed how YouTube is struggling to compete for the business of media companies even after the fact that they were recently acquired by Google.  YouTube’s inability to prevent unauthorized uploads has caused them to lose potential deals with prominent media companies such as Viacom. In addition, some media companies such as Viacom were not pleased with the way YouTube attempted to seal a deal because they felt as though YouTube did not display “respect for their content.”

Analysts have different opinions of what this problem would do for the future of YouTube. Some analysts believe that YouTube needs to make a change in order to build long-lasting relationships with some of these media companies. They believe that they need to adopt new technology to prevent unauthorized uploads and also establish trust with these media companies by protecting the media companies’ copyright terms. Without making some necessary changes, these analysts believe that YouTube will eventually lose out to its’ competitors such as iFilm and Revver. Other analysts believe that YouTube can easily obtain deals with media companies just because of their brand name. These analysts do not believe that competition is a big threat to YouTube.

I chose this article because it shows the existence of some forces of organizational change within YouTube. They may need to do some things differently in order to continue to compete for business with these media companies. What are the forces of change? Well the obvious one is competitive forces since media companies can seek service from competitors such as iFilm and Revver. Might there be social forces working against YouTube because of the increased demand for established trust with these media companies and demand for software that would protect the media company’s content? I believe so.

Does YouTube need to give in to these forces of changes? Or does YouTube have enough bargaining power to resist these forces? Might their strategy of being the most dominant and popular free video sharing website allow them to resist making the changes that these media companies prefer? I believe that this may be the case in the short run. However, I believe that it will not be sustainable once YouTube’s competitors become more popular and trusted by these media companies.

Mentors March 6, 2007

Posted by Stephanie in Organizational Culture, Organizational Environment, sustainable development.

Every so often when listening to the news or reading the paper you hear a story of success or happiness.  While reading the March 12th edition of Business Week, I came across one such article.  The article titled The Holy Cross Fraternity highlights one man’s accomplishments in the late 1960’s when he began recruiting black students to Holy Cross, in Massachusetts, which considering the time and place, was a radical pursuit.  Reverend John E. Brooks took on the challenge of bettering the school and the students by incorporating racial diversity onto the campus.  The African American students Brooks recruited were given full scholarships but many obstacles were still ahead. Between roommate troubles and a general sense of uneasiness around campus, the few black students were not welcomed by all; however “Father Brooks built confidence.  He made you think about your options” (Stanley Grayson).  The article continues about the bonds made among the black students, the troubles they faced and their extreme success after graduation.  Some of the graduates include:

            Edward P. Jones – Puliter Prize winner

            Clarence Thomas – Supreme Court Justice

            Theodore Wells – Attorney

            Stanley Grayson – President and COO of M.R. Beal & Co.

Along with my interest in the Civil Rights Movement and how influential this story is with that respect, I also see this story as a wonderful inspiration of leadership and friendship.  From Management 101 I have learned a lot about the types of leadership roles and what makes an effective leader taking into account the various conditions of the particular situation.  Especially in times of extreme conflict, standing up for what you believe and wholeheartedly upholding those beliefs despite criticism is very difficult and tiring.  Looking at Holy Cross, or any university as an organization, (or a Mgmt 101 company) it can be seen that groupthink, the power of politics, and authority and power are concepts that can easily apply to real, personal situations. 

Who is your role model or mentor?  What makes this person a mentor in your mind?

New Conditions May Ease XM-Sirius Merger February 28, 2007

Posted by silviamocanu07 in Merger, Organizational Environment.
1 comment so far

I found this interesting article on Businessweek (http://www.businessweek.com/technology/content/feb2007/tc20070228_918698.htm), which talks about the proposed merger between satellite radio players XM Radio (XMSR) and Sirius Satellite Radio (SIRI). In the piece, it is argued that thsi merger would not be in accordance with current government regulations. However, the two companies appear to be very confident in obtaining approval for the merge to go through. Their main claim is that the market has undergone substantial changes with the past decade, with new products such as iPods coming into the market. Given the changing environment and new competition, XMSR and SIRI are confident that regulators will grant them approval.

I believe that this relates directly to our class discussion on how the external environment affects organizations and how these must respond and adjust to these changes in order to remain competitive. In addition, it is not only the companies themselves that must adjust, but also regulations that no longer apply to the current market environment, in order to prevent unfair competition from emerging.

In this particular case, despite the fact that the two companies appear to be over 60% sure that the merger will be approved by the regulators, I believe that the process could be quite lentghy and its results uncertain. What do you think? Do you believ that government regulations are changing quickly enough to match emerging issues in the today’s dynamic market environment?