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CASE STUDY: MANAGING PEOPLE FOR ORGANIZATIONAL EFFECTIVES

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You are an engineering graduate with an MBA and 10 years of management experience, andhave just been appointed as CEO of a manufacturing company. The company has existed sincethe 1950s, but tariff reductions since the 1970s have placed it under increasing pressure. In recent years the company has been on the brink of closing down and your task is to turn it back into a viable enterprise. You were reluctant to take on the obviously difficult job and had a number of other options, but the board convinced you by offering a very attractive salary package and undertaking to support your decision fu...

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Question Preview:

You are an engineering graduate with an MBA and 10 years of management experience, andhave just been appointed as CEO of a manufacturing company. The company has existed sincethe 1950s, but tariff reductions since the 1970s have placed it under increasing pressure. In recent years the company has been on the brink of closing down and your task is to turn it back into a viable enterprise. You were reluctant to take on the obviously difficult job and had a number of other options, but the board convinced you by offering a very attractive salary package and undertaking to support your decision fully, provided that you delivered results within a year.The senior management team consists of five people, all of whom were appointed by theprevious CEO when he took up his job seven years ago. The former CEO’s background was inaccounting and his approach to dealing with the company’s difficulties could best be described as ‘cost minimization’ – he sought to rescue falling profits by reducing costs wherever possible.He was, moreover, what he described as an ‘old fashioned manager’ which in practice meantbeing a strict disciplinarian and asserting his right to make decisions without consulting staff.The approach to encouraging staff performance has been the threat of dismissal.The seniormanagement team were in agreement with him on this strategy and this remains their preferred option.As a result of this approach, the company’s plant and machinery has not been upgraded forsome years. The production process is an assembly line and workers are rarely rotated among different jobs. Further, most staff are employed on individual contracts and paid poorly by industry standards. The only assessment of performance is based on production output (which is low by industry standards), and no staff are formally appraised. In spite of a lack of manufacturing jobs in the area, voluntary turnover – employees resigning – is high and this is compounded by the fact that staff are routinely dismissed for minor errors or breaches of procedure. This is justified by the other managers on the basis that ‘there are plenty more where he came from!’ due to high unemployment in the area. The company has already faced a number of formal complaints about unfair dismissal, some of which have ended up in court.

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Solution Preview

In this study, we will basically discuss 3 main issues which are the core focus areas. These are how to develop better management practices for effectively managing people, what changes are required to improve the organizational performance and what are the major challenges or issues which the company is facing right now and how we can overcome them.

Since we all know that human resource that is people are an important asset of the organization and hence it becomes vitally important to make sure that they too are satisfied for the company with which they are working.

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