The Wallace Group, Inc., is a diversified company divided in three groups, Electronics (microelectronics, electromagnetic sensors, antennas, microwaves and minicomputers), Plastic (electronic, automotive switches, knobs, keys, insulation materials), and Chemicals (supplies bulk chemicals to the Plastic Group). These products are principal sales in the government and the automotive industry, and also display system for the Navy-A and the Air Force-B programs. Lately managers feel that each company is independent from each other and that is why Hal Wallace, President of The Wallace Group, hires Frances Rampar for a possible consulting assignment.
It does not make any sense to run a business without Strategic Management and that is the most important problem facing the Wallace Group. They are running the business without goals or a plan. We can begin with:
employees unhappy with the way the business is running by the President and requesting for his resignation the moral of the employees is really poor
The need for and acquisition strategy is badly needly, but the idea was vetoed because it is an expensive program. They want to promote their technical personnel to management positions without managerial experience because they do not want to hire more employees..
Union pay scales high, no-layoffs. To continue with the production equipment they need to cut 20% of the assembly positions
Corporate management demands unnecessary information not related to the jobs the employees are doing.
Salaries too low to attract Employees.
Lend personnel from one department to another without solving their own problems.
Chemical personnel lending people to fill positions in the engineering department.
Engineering doesn’t support the program manager department because they won’t let the program managers hire more employees. Everytime they try to hire someone human resources denies it.
The President won’t let the electronic department make decisions for expansion, and he also requests too many complicated technical reports instead of asking what the department need to get the work done more efficiently.
The material department is buying at higher cost because Wallace Group is the seller.
No plans to expand, no product development effort, no marketing, no sales representatives.
By priorities the recommendations for a better performance are:
Acquisition Strategy Program for acquiring a capability to meet the requirements and perform. The strategy will consider all the aspects inside of the corporation such an acquisition approach, contracting, logistic, system engineering, risk management, impact on facilities, human factors, schedules, and cost. A strategic planning process has to be done. Top corporate managers can begin making suggestions to all the units and functional areas to propose a plan of action or they can give the plan so the functional units can build their own. In the case of Wallace group, since is a multidivisional corporation and having so many environments problems the top-down strategic planning will be the appropriated for them. The mission of Wallace Group has to change from unorganized functional units with no reason of existence like no plans to expand, no product development, not knowing where the organization is, to a:
Where is the Wallace organizations now?
If we don’t make any changes where will be in the next 5 years?
What are the specific action managers are going to take? What will be the strengths, weaknesses, opportunities and threats of these actions?
A good team of top managers will help the organization, because with their capacity, diversity of functional and educational background they will improve the corporation market share and profitability. Morale of the employees is really poor because situational factors. In this case it is the organizational culture, the job they are doing and the managers. Kohlberg’s propose three levels of morale:
1. Preconventional level is a concern for self.
2. Conventional level actions are justified by an external code of conduct
3. Principal level individual at this level looks beyond norms or law to find values or principals.
Effective training and development when business became more complex can make a difference to the business and the manager you will educate to manage this organization. The training is development in six levels:
1. Alignment: Performance Measurements and Analysis Reporting / Business Management Liaison / Governance and Leadership.
2. Support: Finance and Budgeting / Organizational People Skills / The Sourcing Management and Legal Contract Issues / Marketing and Communication.
3. Operations: Enterprise Core System / Service Delivery
4. Resiliency: Data Management and Quality / Security, Confidentiality and Privacy / Business Continuity and Disaster Recovery
5. Leverage: User Technology Competencies and skills
6. Futures: Emerging Technologies.
PriceWaterHouseCooper. Retrieved July 20, 2005, from
Thomas L. Wheelen & J. David Hunger (2004) Strategic Management and Business Policy, Upper Saddle River, New Jersey