Transforming the Texas plant.

Pryor, Mildred Golden ; Humphreys, John H. ; Taneja, Sonia 等

CASE DESCRIPTION

The primary subject matter of this case is organizational transformation, along with the leadership and management theories that are necessary for success. The setting is a Texas plant that builds good products but has many personnel and operations problems that need to be resolved rapidly if it is to be competitive in the short run and survive in the long run. The case has a difficulty level of three to six depending on the assignments. Therefore, it could be used in junior- or senior-level undergraduate courses or first year graduate courses in leadership, management, organizational behavior, high performance teams, and organizational transformation.

CASE

The Texas Plant had been through some tough times. In fact, Corporate had threatened to close the Texas Plant if operations were not improved. While product quality was excellent, the Texas Plant was not competitive with sister plants in terms of speed of product changeovers and cost. Also, union/management problems persisted, and relationships among management employees were strained as well. The Texas Plant's reputation was one of "bureaucratic status quo" with managers who did not encourage suggestions for improvement.

Corporate leaders decided that the Texas Plant needed a team-based entrepreneurial approach that included empowered employees and continuous improvement of processes. As part of the transformation process, Corporate fired the corporate vice president who resided at the Texas Plant and hired a vice president from another corporation. This new vice president, David, was considered a maverick, but in his previous positions, he had demonstrated his ability to achieve performance results. In his first month at the Texas Plant, he realized that he needed someone to help him with the organizational transformation. In his usual maverick style, David personally called a headhunter and described the type of organizational development (OD) person he wanted--one with proven capabilities to rapidly transform organizations. Since the Texas Plant's Human Resources (HR) Director reported to the Corporate Vice President of HR as well as to David, the decision was made by David to have the new OD manager report to Harvey, the Plant HR Director. See Chart 1, Appendix B.

Harvey usually had total control over who was hired, promoted, terminated, and disciplined at the Texas plant. However, over his objections and much to his chagrin, his boss, David, corporate vice president over the plant, hired the new (OD) manager, Paula. She would report to Harvey, the HR Director, but Harvey's boss, David, had already told Paula exactly what he wanted done. He wanted her to design and put in place a system that would transform the plant into a place where empowerment and continuous process improvement were a reality for every person. Harvey cautioned this new OD Manager (Paula) that her direct reports (some "professionals" and some union people) were not capable of achieving what the VP wanted done. He noted that she could just redesign the jobs and hire new people. Paula went to her people, explained to them what Harvey had said, and told them that she believed in them and knew that they could be successful together.

When Harvey heard what Paula had done, he was livid. He told her that he considered her to be arrogant and overbearing. He said, "With your eyes, your words, and your actions, you challenge everything I say and do." Paula did not respond to Harvey. He decided that he would "put her in her place" soon enough. He would show Paula that she had no power--that she would have to get his approval before she did anything as long as she reported to him.

The next thing that Paula did was to establish a leadership team comprised of everyone who reported to the vice president. Initially, the leadership team included the Directors of Engineering, Facilities and Maintenance, IT, Financial Operations, and HR (Harvey) as well as the two production managers and the OD Manager (Paula). Then Paula added union employees to the leadership team. She did all of this without asking Harvey--she just did it and sent out an email to everyone inviting them to a meeting. At the meeting, she said the plant needed a mission and vision as well as goals and objectives, strategies and tactics, and measurements. During the meeting, the mission and vision were written, and she announced that all departments were expected to have their own missions and visions as well as complete strategic and tactical plans. David congratulated the members of the leadership team for moving so fast and said, "Let's meet every week. This is great!" In a few weeks, the leadership team completed the goals and objectives, strategies and tactics, and measurements for the plant.

In an email to members of the leadership team, Paula announced that they needed to develop specific leadership competencies for the plant, and hiring would be done based on those competencies. A new hiring checklist would be developed because the current one was outdated, did not include leadership competencies, and did not reflect what the plant needed. In addition, the hiring would be done by a team comprised of a representative from HR, the manager of the hiring department, and someone from a third department. Joe, the Plant Manager, was upset with the changes because he had brought the current hiring system and form with him from the Tennessee plant.

Harvey was also furious! It was impossible to control this new OD manager (Paula). She just assumed authority. Harvey decided that he would get Joe, the plant manager to help him stop her or get rid of her. When Harvey discussed the situation with Joe, he was very angry and ready to collaborate when Harvey said, "Let's get rid of this presumptuous OD manager who is interfering in everyone's business!" Joe's advice was, "Tell Paula to straighten up or leave."

Acting on Joe's advice, Harvey went to talk with Paula. He told her, "I will not tolerate this behavior--making decisions without talking with me, including changing how work is done in HR without talking with me first." Again, Paula just looked at Harvey and did not respond to him. Harvey assigned Paula more work (the design and delivery of various training modules). He felt that if he kept her busy with work assigned by him, she would stay within the boundaries of her job. He decided that he would assign her more and more work until she complied. She completed the training modules and delivered the training without even showing him what was included. Harvey told Paula that she was at risk of losing her job if she did not "shape up" and treat him the way a boss should be treated. He assigned her more work.

During the next few months, Harvey documented the things that Paula did that were outside of what he considered to be professional, especially since she did not talk with him before she did them. Examples are: (1) scheduling herself to present team improvement results to Corporate and then letting a union worker co-present with her; (2) establishing union teams to improve their work processes, paying them to work overtime to determine needed improvements, and scheduling them present the improvements to the leadership team; (3) establishing a newsletter that was written by an hourly employee; and (4) sending out an email that said all area managers, including HR, IT, and Financial Operations as well as Production, would be expected to establish improvement plans for their respective departments. Paula continued to assume power, make decisions, and take actions without checking with Harvey.

The next time when Harvey talked with Paula, he told her that he wanted her to leave. She could just resign or he would eventually fire her. Paula looked sad but also angry as she began preparing to leave, taking her things down from the wall and packing them. A member of Paula's team called David who rushed to Paula's office and said, "You are not going anywhere. When I hired you, I told you that you work for me, and you don't have to worry about anyone else!" In a meeting with Paula and Harvey, David told them that from now on Paula would report directly to him--that Harvey and Paula would now be at the same level and that they would have to "get along."

Harvey decided that he would have the "last laugh." After all, he was the HR Director. As he drew a new organization chart (See Chart 2, Appendix C), he listed Paula as a direct report to David and gave her one of 12 employees who had previously reported to her. He moved Paula and her one employee from the OD complex to a shabby little office adjacent to the plant. He gave them the oldest computer in the OD complex. The other 11 employees continued to report to Harvey.

In her three years at the Texas Plant, Paula had accomplished much of the transformation that David wanted. The system was in place for empowerment and continuous improvement. People were being hired and promoted who had the capabilities needed to ensure that the system would continue long term. Significant improvements had been made in safety, quality, customer satisfaction, and cost. Natural work teams and cross functional teams were routinely improving processes and relationships as an integral part of their jobs.

However, Paula was now limited in what she could personally accomplish because it was just her and one union person. She decided that she would resign, and as one last action as an OD person and change agent at the Texas Plant, she would advise David how to make the organizational transformation a reality for the long-term. As Paula talked with David about her desire to resign her position, she told him that Harvey was a power monger who acquired and withheld power for his own egotistical reasons (Pryor, Humphreys, Anderson & Taneja, 2009). She noted that Harvey seemed incapable of strategically and tactically using his power for positive purposes. She also mentioned that Joe, the Plant Manager, collaborated with Harvey in his abuse of power and caused problems with plant operations. In fact, Joe gave instructions to Plant employees that were directly opposite to David's instructions and vision for the Texas Plant. She indicated to David that the Texas Plant would be much better off if both the Plant Manager and Harvey were asked to resign.

DISCUSSION QUESTIONS

1. Should Paula resign? If she submits her resignation, should David accept it, or should he ask her to continue in her position at the Texas Plant? What is best for the Texas Plant? What is best for Paula? What actions could David take to ensure success for the organizational transformation effort if Paula stays? What actions could David take to ensure success for the organizational transformation effort if Paula leaves?

2. Discuss David's (the VP's) actions from the viewpoint of various leadership and management theories related to roles and responsibilities, organizational transformation, power, organizational politics, empowerment, high performance teams, trust, etc. What were the positive and negative results of David's actions? What should David have done differently?

3. Discuss Paula's (the OD manager's) actions from the viewpoint of various leadership and management theories related to roles and responsibilities, organizational transformation, power, organizational politics, empowerment, teams, trust, etc. What were the positive and negative results of the Paula's actions? What should Paula have done differently?

4. Discuss Harvey's (the HR Director's) actions from the viewpoint of various leadership and management theories related to roles and responsibilities, organizational transformation, power, organizational politics, empowerment, teams, trust, etc. What were the positive and negative results of Harvey's actions? What should Harvey have done differently?

5. Discuss specific leadership and management concepts relating to this case, including, but not limited to, transformational leadership, change management, organizational transformation, organizational politics, roles and responsibilities, unity of command, strategic management and high performance teams. Students should research each of the terms and provide answers based on their research. References should be utilized. A reference list is provided. It is not all inclusive, but it is an excellent starting point for students conducting research on various leadership and management topics.

APPENDIX A

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APPENDIX B

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APPENDIX C

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Mildred Golden Pryor, Texas A&M University-Commerce

John H. Humphreys, Texas A&M University-Commerce

Sonia Taneja, Texas A&M University-Commerce