Case Study:
" Why Are There Always Paradigm Shifts?"
"When ... there is an inversion of the appropriate relationship between business and organization ... it breeds bureaucracy. Remember, business and organization are not the same thing: A business is the application of resources to create products and services to meet market needs, in relation to competitors; an organization is the way in which those resources get administered. Organization is the means to accomplish the business's ends. You have to know what you are going to do before you can know how to do it.... For managers, organizations exist to carry out business; businesses do not exist to carry out organizations. "When managers manage the consequence of events that have already happened, their organizations are doomed to lagging behind the needs of their business. ... [These organizations] became bureaucracies: businesses that existed to run organizations. "Many years ago I asked an executive responsible for the future development of a very large corporation, "What do you worry about most on your job?" His answer was startling. "I worry most about what my people don't know that they don't know." "The more you revere facts ... the more resistant you are to change. The faster things change, the less you can use facts and the more you need imagination. "It is worth considering what would happen to our businesses and economy if, between now and 2001, all major corporations [and other organizations] came to balance rationality and imagination in their training and development programs." (emphasis added) Future Perfect by Stanley M. Davis.
You are the Systems and Programming manager for a large mail-order company (Rhonda's, Inc. or RI) specializing in women's clothing. The company has ridden the boom of mail-order shopping in the past decade to the point of having annual revenues in excess of $75 million and a staff of 150 (15 of whom, including operations and technical support people are "your" employees). Profits have been high for the past five years. Bonuses are paid regularly, problems are solved routinely, and often you find yourself thinking how fortunate you are to work for this firm. Three years ago, you successfully implemented a switch from an AS/400 environment to a client/server one utilizing 486 processors throughout the network. In January 1996, a project was successfully completed that upgraded the processors at individual workstations to Pentiums. This internal network handles all major functions for the firm such as order processing, inventory, payroll, and accounting (payables, receivables, general ledger, etc.). Object-oriented systems are the norm at RI and CASE tools have been in use since the late 1980s. You hope to move away, as soon as possible, from the line of code being the fundamental unit of your "people's" work. The firm has been on the leading edge of technology thanks in part to the understanding of its Chief Executive Officer, Rhonda Henthorn, of the critical role information, information technology and now, communications technology play in "her" business. A project to make the RI's catalog available in 'cyberspace' was completed in September 1996. A World Wide Web site was established and RI became part of the electronic shopping options on America OnLine. An additional project that established an intranet for RI was completed on December 1, 1996. Again, Ms. Henthorn has led the way for RI. She envisions that the Web will usher in an era of "friction-free" capitalism. She wishes RI to position itself to succeed handsomely in this new digital economy. Long term, she also envisions RI becoming a "cyber corporation" which would involve the majority of RI's revenues coming via digital transactions with its customers. You have been in your position for the past seven years. You have always prided yourself on both your ability to understand, work with, and develop your staff as well as your ability to keep yourself and your organization "current" in the fast-paced world of information systems. In fact, the culture at Rhonda's is a fast-paced, freewheeling one where the employees have been 'ZAPPED' (to use William Byham's term in the ZAPP! The Lightning of Empowerment). Employees have flexible schedules, feel their jobs belong to them and believe they count for something in the "big picture" at the firm. They have a lot of say in how things are done on everything from software selection to the hiring and firing of employees on the many cross-functional work teams that exist. Rhonda told you when you started that three things are essential if you are to do your job well as a manager at RI. They are:
1.) Maintain the self-esteem of the people who work with you.
2.) Listen to them and respond with empathy.
3.) Ask for their help when problems arise.
If you do those three things, you will understand what the soul of being a manager/leader at RI is:
Introduction:
Rhonda's Inc. (RI), a large mail-order company, has been progressing since the past decade to the point of having annual revenue in excess of $75 million. The number of staff has also increased to 150. Profits have been high for the past five years. The company is fully equipped with recent technologies. The implementation of client/server from the mainframe made the system very responsive and flexible to all inevitable types of hardware and software changes. Overall, it is a well-managed and progressive company where the employees feel the job belong to them and they consider work to be "fun."
The Need of a Complementary Section:
Since RI is a large mail-order company specializing only in women's clothing, a complementary business is needed. This should be men's clothing, so RI should take the opportunity to unite with SSI, a men's clothing company. The time for its establishment and cost for men's clothing need not to be spent. All parts from SSI are not good. Specifically, the working environment in SSI is not good. The employees' attitudes are something different from what they should be. So, they are afraid of the new agreement between RI and SSI since they are scared of losing their jobs or may being unable to work in the new environment.
The above problems for the SSI employees and for the unified company totally lie on the management of the new company. Unification with SSI is a big risk; still, it is a very good idea to assimilate SSI. The experience of RI is sufficient to run the organization. RI has a clear vision in its planning. The assimilation of SSI into RI, with perfect management, will make a complete company. It will redouble the outputs. Some customers seek women's clothing and some men's clothing, while some customers seek both women's and men's clothing, so they will not have to go to a third company. Moreover, with the establishment of the World Wide Web (WWW) site, customers do not have to go to the physical market. They can get the services by ordering from their homes.
The New Company:
Since nothing is constant in the world except change, the new company should remain flexible enough to adapt to changing condition quickly. Microsoft Vice President Nathan Myhrovold says, "No matter how good your product, you are only 18 months away from failure". Therefore, innovation is the key to success for any business organization. The new company needs something fundamentally different, not marginal improvements. It needs something more than efficiency, so it should focus to develop an organizational structure that will produce synergies, not conflict. This will help to find ways to maintain a flow of new ideas toward new products and new ventures. Instead of focusing only on the producer or customers, it should be focused on the relationship between the producer and the consumers.
Training and Motivation:
SSI's employees' lack of modern computer skills and fear about losing their jobs will be the main constraints for the new company. The inferiority feeling of the SSI's employees will be the constraint for RI's employees to work together. So, motivation for and a trusting team relationship among SSI's employees are required. Coordination among the staff members in a healthy environment will strengthen the organization and lead to success. Sufficient workspace fully equipped with physical accessories such as communication equipment in the new company will make every employee feel comfortable to work any time he/she likes. With an open door policy, every employee feels free to work for the team and thus can contribute something to the company. The company must know the technical strength of SSI's employees so that appropriate training can be given. Training should be given to both individuals and organizations to help them adapt to the new environment. The company should not resist thinking that the employees may walk out immediately after training, before the benefits of the investment can be realized. They are the active forces, so the stronger the employee is, the stronger the organization will be. Organizations learn only through individuals who learn. Without individual learning, no organization learning occurs and no progress results. This training will focus more on learning than on education. Without training, employees even with strong knowledge cannot apply modern high technology. Training will enable all employees to work together in the new environment. This is something like an aligned team, where the output is much greater than the sum of the individuals. Higher pay with a new well-defined job description for every employee will certainly make SSI's employees feel safe from the fear of losing their jobs.
Mass Customization:
The new company should look at how to do a customized business. Mass customization will be as important to the coming days as mass production was in early days. Mass production keeps costs low while satisfying customers' desires; mass customization will give customers what they want and when they want it in a better, faster, and cheaper way. New technology is making "mass customization" increasingly possible. Customers who love to shop are limited by the number of clothes they can try on or the amount of time it takes to change into and out of each outfit. The solution is an electronic dressing room called a magic mirror. The customer sees a reflection of his/her own face, hands, and feet, and the computer creates the clothed rest of the picture, shaping the figure to conform to the customer's own, and changing outfits as fast as the customer wants to. Final choices are generally made by literally trying on narrowed down choices. With the customer's final choice, a computer disk containing information is inserted into a computer cutter, which takes far less time than any other methods to cut. With a help of a so-called "virtual master tailor," clothes will be ready at the customers' homes, guaranteed to be a 100% perfect fit.
Intangible Services:
The company should know that future growth for mature businesses comes from advancing level by level, from data through information to knowledge, and that any business can transfer itself into a knowledge business. For this, the business itself must continually learn how to provide that product or service, and customers become learners through the use of knowledge-based products and services. It should be remembered that every customer has the potential to become a lifelong learner. Knowledge businesses are not limited to brainy folks in education. In the world of business, lifelong learning is something everyone is urged to do. With these knowledge products, the more the customers use them, the smarter they become.
An increased value does not come from material changes so much as from new intangibles. Choice, variety, and service embedded in traditional products create smart products and new market opportunities. The more information the manufacturers put into a product, the more it will evolve beyond the original intent into new purposes. These new ones, based on information, may present even far greater opportunities than the original.
By placing chips in clothes, the information on where and when the item was made, when was it purchased, and by whom can be available. This may help not only to solve the problem of items being returned but also to communicate back: "Help" cries jacket. " I am being stolen". With additional information, customers know how much longer their clothes will last? Will it be possible to let them know when clothes must be washed? Also the intensity of light can change the color of the clothes, it will provide an additional design in clothing. With thermostat clothes, the customers will have to bother less about the season. This will add intangible services to the tangible products.
Virtual Office:
The new company's employees will also have flexible schedules, which require the virtual office to remove physical boundaries of the work group. Employees will have freedom to manage time and information requirements whenever and wherever they choose. This will help the new company to send and receive information even when employees are away from the office. They can have meetings despite different geographic locations, so called "virtual meetings" where the members do not need to wait for other members to be present at the same time. Any member can leave his/her message in his/her own sweet time. Other members will receive the message and can write comments whenever they feel like. This will help to serve the customers in time.
Software Reusability:
The company is using the latest technologies in computer skills, so it has to think about the reusability of the software. Reuse is the process of building software systems from components designed for reuse. In the future, software development will be based on software reuse because it is the best answer to the system crisis. Software reuse is the process of creating software systems from predefined software components designed for use. It can greatly reduce software application development time, costs, and the risk of failure as well as greatly improving the quality of software applications. Though software reusability is simple, its implementation is not. It is valuable since saves even more than 50% of an application?s design and code. Exploiting reuse opportunities enables significant software productivity, quality, and cost improvements. The major benefits that reuse can deliver are to:
Security:
In connection with security in the new environment, firewalls should be implemented to protect computers from external sources of communication. Internal security is totally based on the management of the new company. Since data and information are corporate assets, the internal use of illegal and destructive programs for destroying data through viruses and worms should also be checked. These viruses and worms not only destroy data, but also erase files in the hard drive and negate hours of hard work. The purpose of security in the new environment is to ensure confidentiality, integrity, and availability, as well as detection of any unauthorized access. Also, cables with greater bandwidth such as fiber optics should be used for carrying vast amounts of data. The basic principle is that computer data, whatever its form, should be protected by all users according to its classification.
The most important aspects of data security are maintaining a pleasant working environment and providing management support. Assessing the nature and degree of threat to the systems is necessary before deciding what measures should be introduced, so that unnecessary expenses and operational inconveniences can be avoided. Data security must be included in the design stage and tested prior to operating. The four main objectives of computer data services are these:
The system should be protected from threats such as internal elements through authorized access, electrical failure, espionage, water, fire, earthquake, criminal activities, and sabotage.
Conclusion:
The new company should have vision, a specific destination, and a picture of the desired future. Its vision statement provides the future state for the organization to strive to reach. All the members in the team should be clear what the specific goal of the company is. This will make them understand what their working position is and what they have to do in the next step. The team should be aligned. It is not friendship; it is a special team relationship that makes the team special. The new company should utilize information technology, first to survive as it is beginning the unified company, and then to thrive.
In the past, companies competed on price. Now the time has changed. Customers look for quality, people forget about the price with the passage of time. But the quality remains so long as the product lasts. So the future business will be in design. The new and exciting fashioned-forwarded products are always scarce. No one needs anything more than service. In business, customers are the kings. Great services are the greatest innovations, so the company should focus on responsiveness and reliability. Commitments to the customers should not be made lightly; they should be the highest priority of the business and always be met. Items should not be considered as sold after the customer bought it; it is sold only when the customer is satisfied. The company should focus on business more than on organization.
