This case discussed the events that occurred during a change in DSS Consulting’s organizational structure. Three retired school district administrators established DSS Consulting during the late 1990’s. The company offered administrative support to small school districts located within the mid-west and mountain west region. They specialized in handling the negotiating of labor agreements as well as implementation of permanent system solutions designed to enable those organizations to run efficiently.
The firm experienced a significant degree of success during their early years, which was primarily attributed to the founder’s personal relationships within each school district that utilized their services. The demand for the services offered by DSS grew quickly given the changing dynamic of challenges faced by each district. Some of those challenges related to reductions in budgets and subsequent reduction of administrative staff. The firm structured themselves to accommodate the change in services needs of their customers. As a result, DSS designed an organizational structure that consisted of the four areas of specialization: Procurement and Systems, Information Technology, Contract Negotiation and Facilities Planning.
By the mid-2000’s, DSS experienced some significant changes in their organizational structure and their customer base. It was during this time that the founders of the company reduced the amount of time they were spending in client engagement and relying upon the expertise of the management teams for each specialized area. As a result, a gap was created surfacing the need for a strategy for attracting and retaining new business. This would require adapting their service offerings to meet the demands of rapidly changing market base. These factors led to a halt in the firm’s growth and forced the company to redefine the organizational structure to remain a competitor.
The key issues of this case involved successfully redesigning the firm’s strategy, implementation of those changes while maintaining their level of success. The firm would need to realign their management structure and create functional teams to design, develop and implement product offerings that would appeal to an expanded market (i.e. larger school districts). A major consideration for the firm was how to achieve this goal and maintain the level of commitment from employee’s as change in any form can be a daunting task.
A new management structure was determined and Meg Cooke was appointed the Chief Operating Officer of DSS. Ms. Cooke and the Board of Directors made the decision to adopt a new structure that created cross-functional teams each assigned to a specific region for which they would design and create products for customers specific to their region that could potentially be marketed to additional regions with similar demands. Based on my review of the case, the major issues identified can be categorized as communication, leadership, organizational culture and organizational change.
The manner in which the new strategy was communicated at all levels of the organization appeared to lack a clear concise message which defined the redesigned strategy, new organizational structure and a detailed implementation plan to achieve the desired results. The communication of these changes wasn’t handled in the most efficient manner and subsequently not received by all employees in a favourable manner. Study results that have been published by the University of Pittsburgh’s Katz Business School have indicated that effective communication skills have become one of the most important factors when recruiter’s are screening candidates for potential managerial positions. Both Ms. Cooke and Ms. Peterson failed to communicate in all phases of the organizational change. Although it appeared that Ms. Cooke met regularly with other department leaders, she and Ms. Peterson never had regularly scheduled planning meetings or informal weekly check-ins to ensure that she and her team were on target for successfully delivering the team’s objectives.
Although, Ms. Peterson communicated and fostered open, collaborative conversations with her team, she failed to communicate with her manager to ensure that she understood expectations for herself as the leader and for her team. Successful communication is only achieved when the sender and receiver of information have the same understanding of the information presented. (See Figure 1) For example, when Chris Peterson was assigned to lead her team in delivering new products that would appeal to larger districts within and outside of her designated region. She received the message as “ create/design new product offerings that would appeal to districts within the southwest region.
The style of leadership varies with every individual. It has been stated that today’s successful leaders have created in their organizations an atmosphere where every employee believes in management, their strategy and the importance of their individual contributions in achieving the organizations goal. Blake Mouton’s Managerial Grid is a model using in identifying leadership style that is based on the concept that there are two behavioural dimensions: concern for people which can be defined as the degree to which leaders are aware of and consider the needs of their staff, their skill sets and development potential when making decisions about specific tasks to be completed. The second dimension is concern for production and is defined as the degree to which leaders place importance on objectives, efficiency and production specifically what it takes to meet the desired result.
Based on these definitions, I would classify Ms. Cooke’s driving leadership behaviour dimension to be in the latter category of concern for production and Ms. Peterson’s as concern for people. It was evident that Ms. Cooke’s leadership style resulted in a disorganized and poorly motivated organization. Her lack of leadership to Ms. Peterson resulted in the team being led in the direction of focusing their efforts on a project that would not be approved. Ms. Peterson clearly valued the skills of each team member as well as taking extensive steps to ensure that a collaborative, innovative environment existed for her team to design and develop a new product offering for the districts in the southwest region that would meet their needs.
Organizational Culture and Organizational Change
The culture that exists within any organization plays a vital role in the behaviour and actions of employees. Organizational culture as defined McLean and Marshall is a collection of traditions, values, policies, beliefs and attitudes that constitute a pervasive context for everything we do and think in an organization. Based on this definition, DSS’s original organizational structure could be classified as so-called Power Culture (Handy, 1993). This culture is typical for small entrepreneurial organizations similar to DSS, where the founders had a strong influence and played a central role in managing the company and securing contracts from their school district contacts.
These types of cultures rely heavily on trust, personal communication and empathy. The structure is very informal and there are few rules and guidelines in this culture. However, the changes implemented at DSS to redefine their strategy forced a culture change as well. The organizational structure changed from functional to a more structured matrix type. The appointment of the COO position shifted the organizational culture from the personal interactive environment to one of project and task oriented nature. This shift made implementation of the new strategy increasingly more difficult as this was new to everyone at all levels of the organization.