Peter Browning: Macro/Micro Problem and Causes
Continental White Cap was a very successful company with impressive profits for the last 50 years leading up to 1984. This success caused several major obstacles for Browning with one being that only a few people at White Cap would acknowledge the need for change (Jick & Peiperl, 2011). Any financial slumps were blamed on a cyclical and transient market. The second obstacle was the well-known family-style culture and long-term paternalistic management philosophy that founder William P. White and his two brothers instilled since the companys inception. This paternalistic management philosophy created great loyalty from the employees, long-standing traditions of job security and generous benefits packages. Brownings attempt to alter these traditions would be met with great resentment.
Another obstacle was the burden of systems and processes keeping White Cap from moving forward and continuing as a market leader. Brownings assignment was to revitalize and reposition the division to remain a market leader (Jick & Peiperl, 2011). In 1984, there were by then five significant manufacturers in the national market place and 70 worldwide (Jick & Peiperl, 2011). The advantage White Cap had maintained in the market made it difficult made it difficult to effectively stay competitive with competitors, such as National Can Company, making drastic price cuts to gain market share (Jick & Peiperl, 2011). Browning came to the conclusion that without production of a plastic cap closure, White Cap would become irrelevant and continue to lose customers. Senior management of White Cap compounded this problem with the reluctance to allow R&D to commercialize plastics developments since plastics threats in the past never materializing (Jick & Peiperl, 2011).
Organizational Systems Affected
The organizational structure was the first and most obvious affected. The structure was never set up as a hierarchy management system with top down management approach. It is obvious by reading the case that Continental Group, Inc. managed their divisions with a separate operating philosophy. Hence the reason White Cap operated with less than open and cooperative relations with the parent company (Jick & Peiperl, 2011). Continental Group viewed White Cap as this prima donna division with inflated salaries 10% above its other divisions (Jick & Peiperl, 2011).
Psychosocial issues in this case stem from the employees feeling a sense of entitlement from the family culture. When you have over 51 percent of the employee population over 40 and another 30 percent over 50 and these two age groups never witnessing great financial downturns, change isnt going to be a welcome addition.
Technical and managerial systems in this case were also affected. Brownings attempt to move the company to a more efficient operating model as done with the Bondware Division, would mean leaner management with less layers and a production system that would rejuvenate White Caps competitive advantages (Jick & Peiperl, 2011). This strategy would be met with inherited department management such as Jim Stark, the Director of Marketing. At a time when major, long-term customers in established markets where attracted to the emerging use of plastic-packaging technology, Jim Stark was content with administering outdated existing programs (Jick & Peiperl, 2011). Another inherited management issue for Browning was the manager of human resources, Tom Green, whos offered nothing in the way of constructive ideas and quick management decisions. However, his twenty plus years with White Cap gave Browning an advocate and voice with employees (Jick & Peiperl, 2011).
The goals and values of the organization were to remain successful in a competitive environment, be a profitable company and to maintain and not demoralize a loyal work force and management (Jick & Peiperl, 2011). Browning hoped that his success and familiarity with White Cap would lead to creative thinking and a long run at making a successful company survive through change initiatives and competitive forces. Alternative Solutions
Even-though Peter Browning was very successful at turning around the Bondware Division of Continental Group, Inc., and using radical surgery to do so, White Cap would prove to be a much bigger challenge (Jick & Peiperl, 2011). Browning will need to use a softer approach and get an over-whelming buy-in if he is to be successful. He must make the management and employees realize that Continental Group, Inc. owns White Cap. Not the other way around.
Recommendations and Implementation Plans
My recommendation would be for Peter Browning to take on a parenting strategy approach. Keep the divisions but introduce a collaboration concept to White Cap management. What the parenting strategy does is focus on resources and capabilities used to build value across business divisions. The funds that come from such a strategy could help White Cap reach above their competitors rather effortlessly and build the systems needed to compete in the new plastics technologies. Another recommendation is the horizontal growth strategy. Through this strategy, White Cap could acquire market share, production facilities, or specialized technology. Which is desperately needed as market share was falling fast by 1985 (Jick & Peiperl, 2011). White Cap could expand into regions that they have not ventured into and will help position them at the top of most plastics markets.
Due to competition, White Cap will need to differentiate by providing unique and superior value to customers in terms of quality, special features, or after-sale services. Such as cap replacement for warrantied products. With the strategies White Cap has in place and their proposed plan to become leaner and efficient, I feel that the best strategy would be the competitive strategy. White Cap is doing well with most of their strategic factors and the competitive strategy would help them realize what is taking place around them, especially since they are in the ever changing lid business where threats and weaknesses can destroy progress due to overlooking competition and innovation.
The program I feel that best fits White Cap would be to implement the TQM program (total quality management) as it stresses commitment and without it, nothing will work. TQM also emphasizes prevention. The whole organization will focus on customer satisfaction internally and externally. The emphasis on training in areas such as how to measure and interpret data will greatly improve the operations through-out White Cap.
Through trust and teamwork, White Cap employees will seek empowerment to make decisions independently and together to further the initiatives of the much leaner and efficient company Browning will implement. The TQM program will help keep everyone evolved to obtain better quality, quicker responses to market changes, greater flexibility, and improve or to even eliminate non-value-added work which is what TQM is all about.
Jick, T.D. & Peiperl, M.A. (2011), Managing change: Cases and concepts. (3rd Ed.). New York. NY McGraw-Hill.