Spencer was a plant manager of Modrow Company, a Canadian Branch of the Tri-American Corporation. Tri-American was a major producer of primary aluminum with integrated operations ranging from mining of bauxite through the processing to fabrication of aluminum into variety of products. The company had also made and sold refractories and industrial chemicals.
The parent company had wholly owned subsidiaries in five separate United States locations and had foreign affiliates in fifteen different countries. Tri-American employed approximately 22,000 employees in the total organization.
The company was governed by a board of directors. The board set general policy, which was then interpreted and applied by the various plant managers. This decentralization in organizational structure increased the freedom and authority of the plant managers, but increase the pressure for profitability.
Spencer started his career in Tri-American Corporation as salesman and he succeeded. After two years of successful work as salesman, he became the symbol of what salesman have to be. In his career in Tri-American, he had worked as salesman, troubleshooter, assistant plant manager in English branch in London UK, plant manager in Birmingham in UK and his last position was plant manager of Modrow company in Canada.
It was another challenging position in his career and he had faced few problems regarding to management, organization culture, organization conflict and organization innovation.
• Spencer was a plant manager of Modrow Company, a Canadian Branch of the Tri-American Corporation. • Tri-American was a major producer of primary aluminum with integrated operations ranging from the mining of bauxite through the processing to fabrication of aluminum into a variety of products. The company had also made and sold refractories and industrial chemicals. The parent company had wholly owned subsidiaries in five separated US locations and had foreign affiliates in 15 different countries.
Tri-American employed approximately 22,000 employees in the total organization. The company was governed by a board of directors, which included chairman, vice chairman, president and 12 vice presidents. Subsidiaries and branches are organized as independent companies and decisions are decentralized. • The Modrow Branch was located in a border town in Canada. The total work force in Modrow was 1,000. This Canadian subsidiary was primarily a fabricating unit. Its main products were foil and building products such as roofing and siding.
1. Resistance to change by employees, this problem shows when Dick as the plant manager asked the worker why he was using the saw when the material could easily be bent fifted into the barrels, resulting in saving time and equipment. And then the worker said “We’ve never done it that way, sir. We’ve always cut it”. After all the power saw are removed from the scalp area in order to adjust new method of bending rather than cutting. A few day later Dick find out that workmen using hand shears to cut each strip to cut.
2. Process of Production Problems. In his new position as Plant Manager at Modrow, he found that construction was slower in completion than originally planned; equipment arrived before the building was finished, employees were upset about the extent of change expected in their work routines with the installation of additional machinery, and in general morale was at low ebb.
3. Culture Change Problem; there is the difference between American and British philosophy and performance within the plant. Here, he also found that his power and authority were less than those of his superiors, so he constantly found himself in the position of having to soft pedal or withhold suggestions that he would have liked to make, or innovations that he would have liked to introduce. After a frustrating year and a half, Dick was suddenly made plant manager of an old British company which had just been purchased by Tri-American.
He left his first English assignments with mixed and moved from London to Birmingham. In Birmingham, he become a plant manager and operated much as he had in his troubleshooting job for the first couple of years of his change from sales to administration. He did some changes in Birmingham. Training and reduction programs were instituted for all supervisors and managers who survive the initial purge. He tried to focus/ control on relationship between production and the needs from sales by simplifying and redesign in order to increase profit. Later the company showed a small profit for the first time in many years. For this successfulness, then he requested transferred back to United States.
4. Cost Reduction Problem, by the end of his first year at Modrow, the building program had been completed, although behind schedule, the new equipment had been installed, and some revamping of cost procedures had been incorporated. But, the financial picture at this time showed as a loss. Later, all managers of the various divisions had worked closely with their supervisors and accountants in planning the budget for the following year.
5. Human Relations/ Interaction Problems When he worked through his first year as plant manager, Dick developed the habit of strolling around the organization. He was apt to leave his office and appear anywhere on the plant floor, in the design office and at the plant cafeteria rather than in the executive dining room, or wherever there was activity concerned with Modrow. At first his presence disturbed those who noted him coming and going, but later, the workers came to accept his presence and continue their usual activities. Supervisors, managers, and foreman, however, did not feel as comfortable when they saw him in the area.
6. Different corporate culture in Canada, even though Canada is located in same geopolitical areas, geographically and nationally Canada is different country and corporate culture is bit different from USA. And Dick Spencer is American manager who started his career in USA. As we can see from the case, Dick Spencer is basically very stunning to adapt different corporate culture in different countries such as UK and Canada plant career. We can see it from this sentence: ‘… In recalling his first year at Modrow, Dick had felt constantly pressured and badgered. He always sensed that the Canadians he worked with resented his presence since he has brought in over the heads of the operating staff’. At the same time he felt this subtle resistance from his Canadian work force…’.
7. Organization conflict in Modrow plant, there was an obvious conflict between workers and Dick Spencer. We can see it from this sentence: ‘… In recalling his first year at Modrow, Dick had felt constantly pressured and badgered. He always sensed that the Canadians he worked with resented his presence since he has brought in over the heads of the operating staff …’. In the other words, other workers couldn’t live up with Dick’s arrival in the company.
8. Corporate innovation management, at the time of Dick Spencer’s arrival in the Modrow Branch, there was a lack of good corporate innovation management. We can see it from this sentence: ‘… Prior to Dick’s appointment as plant manager at Modrow, extensive plans for plant expansion and improvement had been approved and started. Altough he had not been in on the original discussions and plans, he inherited all the problems that accompany large-scale changes in any organization. Construction was slower in completion than originally planned, equipment arrived before the building was finished, employees were upset about the extent of change expected in their work routines with installation of additional machinery, and, in general, morale was a low ebb…’
9. Decentralization, basically this is American organization type and American one is more formalistic than European. Decentralization is basically increase the pressure from parent company management. We can see it from this sentence: ‘… This decentralization in organizational structure increased the freedom and authority of the plant managers, but increased the pressure for profitability…’
10. Lack of leadership for Dick Spencer, in terms of organization leader Dick Spencer shouldn’t include the all the works in the organization. He tried to do it by himself every single things and he aimed to attend every action. In terms of HRM, this is not good character for the good Leader. We can see it from this sentence: ‘… As he worked through his first year as plant manager, Dick developed the habit of strolling around the organization…’. This created the conflict between him and workers. Also this creates dis-approvement from workers. We can see it from this sentence: ‘…Supervisors, managers and foreman, however didn’t feel as comfortable when they saw him in the area…’
11. Lack of knowledge in Human resource and accounting knowledge, these two courses were disadvantage for Dick Spencer in this study in MBA and these two are very important for any organization. In the other way, he can find and hire someone who can do his unknowledgeable fields such as accounting and HR.
12. Too high expectation from management made pressure, we can see it from this sentence: ‘…he believed that the president and his friends in the home office were constantly on the alert, waiting for Dick to prove himself or fail flat on his face…