Case Study 2 Culture Clash CEO Jane Lionel has some hard decisions to make with regard to some of the company’s older hands, and even on the eve of that decision, I believe she is wavering about what she should do. I will be in that meeting, assisting with that decision, and I’m not certain which way to go, either. And so here I am, sorting through and writing down my thoughts. When Jim Lionel started manufacturing heavy-duty construction equipment here in Alaska 40 years ago, his personal management style reflected the ruggedness of Alaska and the construction business. He understood that he was producing tough equipment for tough men working in an unforgiving environment. At 60 500 and over 300 pounds, Lionel personified the bigger-than-life image of Alaskan workers. He had a no-nonsense management style. He coddled no one. Jim Lionel expected and got results. He chewed—not smoked—a cigar. I swear that in the 30 years I worked for him, I never saw that thing lit up as he barked—yes, barked—orders. I’d have to say that Jim Lionel gained respect because he always delivered and his word was his bond. But he never achieved admiration. There was no finesse. A new HR director once mentioned to me that Jim should create bonds with his workers through techniques such as management by walking around. I said, ‘‘Believe me, you do not want him walking around—that simply means he’s stressed and he’s mad.’’ You could actually feel him and hear him before you saw him, and as one employee said, ‘‘When he barked your name, your heart stopped, because until that moment you were certain that he did not know your name.’’ We all figured that his temper would explode one day and he would die on the shop floor from a heart attack. Then suddenly, he did. Following his death, we were certain that the company would have to be sold in order to continue operations. However, Jim’s one true friend and confidante was his wife Jane, and with unanimous board approval, she moved in to take his place as the head of the company. The initial concerns and fears of employees were soon calmed. Jane knew the company to a degree that surprised employees. But her management style, developed over 20 years as head of marketing for a regional healthcare organization, was in stark contrast to that of her husband. While Jane shared her husband’s goals and high standards for quality and on-time delivery, she also believed in the importance of demonstrating to employees their value to the company. She not only communicated her vision, but she took the time to listen to the employees, to give them opportunities to voice opinions, express concerns, and submit ideas. She met regularly with individual departments and assisted line workers in the movement toward self-managed teams. The reaction from workers was positive. And a year later we can see a huge change. Production is up slightly, but the real change can be seen in people’s attitudes and pride in their jobs. Communication and the overall level of civility among employees have improved dramatically. But while these cultural changes have been embraced by the majority of workers and supervisors, there are two glaring exceptions. Supervisors Curtis Willett and Morgan Elder were among the first people hired by Jim Lionel. Their long service to the organization and their consistency in meeting all production goals and deadlines is impressive. They take pride in their ability to push themselves and their crews relentlessly. However, their management styles are a throwback to the old culture. They succeed by intimidation. The civility and cooperation that characterizes other parts of the plant are shoved aside or drowned out in a barrage of yelling. ‘‘Shock and Awe,’’ the joint nickname that was briefly given to the two men by employees following the 2003 U.S. aerial assault on Iraq, has been revived. If these men are aware of the label, they are probably proud. So, here’s our dilemma: They are too old to change. Curtis and Morgan not only do not fit the new culture, but through tactics of control and intimidation, they also encourage workers to ignore the new cultural initiatives. Everyone is on board except the employees in these two adjoining areas of the plant. So, we cannot reach the full potential of the new culture while the old culture pulls us back. Fire them? Demote them? I don’t think so. They’ve done nothing wrong. Their crews are meeting their production and quality targets. Furthermore, these two guys have been with the company for 40 years. A move on our part that appears unjustified opens us to an age discrimination suit. But I also don’t see how we can change the culture unless they leave. So, we meet tomorrow to determine what we can do. Writing about a problem usually helps me to sort things out. When I finish, I generally have an answer or at least an idea about how to proceed. I’ve finished writing. And I haven’t got a clue.
1. What options do you think Jane and her management team should consider with regard to these two long-time supervisors? Discuss the positives and negatives of each option.
2. Do you think it is appropriate for Jane to remove two long-time, high-performing managers in order to create a new culture for everyone else? Why? Consider the material in Exhibit 14.3 (attached) in your answer.
3. What do you recommend that Jane do? Explain why.