Arabia Lights case study on strategic management

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Answer should be at least 2 pages. Case is attached.

Assume that you are the MD of Arabia Lights. As the leader of the organization, explain how you will handle the entire situation to make the Arabia Lights once again successful with all its major problems resolved.

Please note that you should not respond to the case as to what you would have done on each instance if you were the MD at that time. Whatever was supposed to happen has already happened in the company. Now, in the given scenario, you should explain in detail all the things that you will do as the leader of the organization to resolve the issues and get the business back to good standing.

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Arabia Lights – A Comprehensive Case Written by: Dr. George Thomas, Prince Sultan University Arabia Lights is a family owned enterprise producing and selling electric bulbs and tubes. The company is a small organization, which has three departments Production, Finance & Accounting, and Marketing. Although, the company is producing only bulbs and tubes at the moment, it realizes that the future of lighting industry is the compact fluorescent lamps (CFLs). Adding CFLs to the product line is under its consideration; otherwise it may lose out eventually to big players in the market. Currently, the owner, designated himself as the Managing Director (MD), heads the company. The company has plans to convert itself into a Public Ltd. Corporation. With this idea in mind, the MD has instructed Mr. Abdullah to prepare a vision, mission and a strategic plan for the company coordinating with other departments. Practically, the MD views Mr. Abdullah to be the CEO of the company, once its expansion plan works out the way it is envisaged, when he (the MD) will be designated as the Chairman. The MD gave such a hint to Mr. Abdullah during a couple of their interactions. Currently, Mr. Abdullah is the Marketing Manager of Arabia Lights, who joined the company only three years back. He is known in the company as an efficient manger, who is very strict with his subordinates. He was a graduate in marketing from a reputed university in the United States, and had 12 years’ experience mainly in sales in two other companies. Having joined Arabia Lights, within a short span of time, he could achieve excellent sales results. Some of his efforts in sales planning and customer segmentation produced commendable results. An advertisement campaign that he launched in the first year of his service was also well received by the customers shooting up the customer enquiries on the company’s products substantially and the sales moderately. The Marketing Department consists of three sub-units namely Sales Division, Marketing Research Center, and Promotion Unit. In its Sales Division, five Sales Executives are working who are reporting directly to the Marketing Manager. The Marketing Research Center is just a nominal unit, which has only two employees, who after graduating in Marketing worked with Neilson (a renowned Marketing Research firm) for a few years before joining Arabia Lights. The only major function that the unit does is to prepare area-wise sales reports in statistical and graphical forms, which has become more or less a routine job. They feel that the Arabia Lights does not utilize their experience and potential in a meaningful manner. They, sometimes, shared an impression with different people in the company, including with Mr. Abdullah and the MD that they had different ideas to boost up the sales. However, since Mr. Abdullah himself had his own strong Sales and Marketing plans, he paid only negligible attentions to such ideas. Similarly, the promotion unit as well has only two employees. They interact with a leading advertising company, whose service is contracted by Arabia Lights for all its promotional activities. The interactions are at a minimal and routine level. They mostly execute the orders of Mr. Abdullah – one of them once said (with an element of frustration), “We are just order-takers in Arabia Lights and not part of a creative promotional team.” In fact, the MD realizes that Mr. Abdullah does not pay much attention to any other unit than the Sales Division as if he (Mr. Abdullah) did not have much expectation from the other two units, hence did not put much effort to test their abilities either. The Production Department of Arabia Lights is headed by Ted Robbins, who was an American with an engineering background and five years’ supervisory experience in an American company producing bulbs and tubes. In comparison with other heads of departments in Arabia Lights, he enjoys higher pay and benefits. It appeared that the other two heads of departments have unpleasant feeling about such a special treatment given to Mr. Robbins, although they have not so directly and specifically mentioned about it to the MD. Whenever issues of coordination mattered, particularly Mr. Abdullah had a little reservation to entertain the views of Mr. Robbins, and used to point out that the knowledge of Middle-Eastern culture is important to be successful in business in this region. The head of the Finance & Accounting department Ms. Maha used to agree with such comments of Mr. Abdullah as if there was a little collusion between the two against the other. Mr. Robbins always asserted that whatever products Arabia Lights needs with any quality and quantity specifications would be provided by his department, if it is given the required financial support. He normally adds, “Marketing Department is the one who must say what products it needs, and Finance department should get me the required fund to produce the products; then take it from me that the products are ready for the market.” What is special about Mr. Abdullah is that he strongly sticks with his plans; for example: he does not allow any of the Sales Executives to alter the sales plans. Abdullah, being a responsible manager, regularly visits each sales territory of the company, gives the Executives strict directions, and keeps away from any social engagement with them. Although he was very humane, social and lively person by nature, he purposefully pretended to be very strict a boss to all his subordinates. There was a very specific reason behind his pretension. The previous Marketing Manager of the Company, Mr. Faris was allegedly fired by the company for being so friendly with the Sales Executives, and thus failing to control them effectively. Mr. Faris was a family man, who could only rarely visit the different sales territories or coordinate the sales efforts properly. Hence, he behaved in a manner as if he strongly believed in the Sales Executives and didn’t appreciate the idea of strictly controlling them. He often said, “Controlling is a game of the past.” Most of the Sales Executives really loved him that upon his resignation, some of them visited him at his residence and said, “The only man in the company with a human heart is leaving it; it is really sad”. However, the company was so unhappy with him because he couldn’t achieve even a satisfactory marketing results despite repeated warnings. The MD did not explain either to the Sales Executives or to Mr. Abdullah what culminated in the resignation of Mr. Faris. As was stated earlier, the MD looked at Mr. Abdullah as the future head of the company. He wanted Mr. Abdullah to play a total leadership role than just being the Marketing Manager. Therefore, he sometimes reminded Mr. Abdullah to coordinate all the departments and required staff to prepare a vision, mission and strategic plan for the company. Mr. Abdullah made some individual efforts and homework towards the preparation of the strategic plan, and had even a meeting with the other heads of departments almost a year back. However, only little progress has been achieved thus far on this front. The MD made a casual remark about this failure in a recent meeting with Mr. Abdullah. Then, Mr. Abdullah smiled and said, “I was really busy with several things, hope you understand it” and the MD said, “Okay….,” bit unapprovingly. The major emphasis of Mr. Abdullah was on improving the sales. Under him, all the Executives improved their performance initially, though only one of them could achieve the monthly sales target regularly. Three other executives achieved the targets off and on. He came down so heavily on all those who failed to achieve the target but that was done very secretly on a one to one basis and never in public. However, he often avoided appreciating the achievers because he feared that it might result in losing control over them, and might make the Executives feel complacent about their performance. Instead, he kept on informing his appreciation about the achievers to the MD through the confidential performance appraisal reports. The Executive who regularly achieved the target was Mr. Yasser. Mr. Abdullah, many a times, increased his target but Yasser never failed to achieve it. Mr. Abdullah was very happy and proud of Mr. Yasser though he did not reveal it at all to Mr. Yasser. Once Mr. Abdullah gave him a special assignment to study about two new territories and then to submit a report within a month. The secret purpose of this assignment was to understand Yasser’s capabilities to be recommended for a promotion as the Head of the Sales Division. Although Mr. Yasser was not aware of this secret purpose, he produced and submitted an excellent report. While submitting it, Mr. Yasser said, “This is my heart and brain, and in this you can see the pain of my children losing their father’s care”. Mr. Abdullah did not respond in any way to this comment or about the report to Mr. Yasser. However, Mr. Abdullah studied the report and found it so exciting that he said to himself, “Yes, it is his heart and brain”. Without any further delay, he recommended to the MD to promote Mr. Yasser as the Head of the Sales Division, a position that did not exist before. Mr. Abdullah did not inform Mr. Yasser about this because he wanted the letter of promotion to reach him (Mr. Yasser) as a surprise. After a few weeks, in order to prepare a new sales plan, Mr. Abdullah asked Mr. Yasser to collect some more details about the new areas that he had studied. Mr. Yasser responded quite strangely in an angry and heavy tone, “Read the report carefully, whatever information you require, you would see in that”. He added further, “What would you like me to do?......to do business in my area or to study about another area…..; it is humanly impossible for one to do both!” He was really furious. Mr. Abdullah was so embarrassed that he categorically said, “I am the manager, I know what is right and wrong; if you have to work under me, do it or forget about your job ……..”. Mr. Yasser said “Arabia Lights is not the only company on earth.” Now that everyone in Arabia Lights is suspecting that either Mr. Yasser or Mr. Abdullah will leave the company. Different people in the company briefed the MD about the issues between Mr. Abdullah and Mr. Yasser. However, what the MD is more worried about lately is the dramatically falling sales level of the company. He understands that the reasons for sales decline could be several like ineffective marketing strategy, poor promotional efforts, inefficient sales team, etc. However, the single most important reason that he could identify was a change in consumer behavior. People are increasingly moving away from bulbs and tubes to CFLs, especially in response to the recent hike in electricity tariffs. Arabia Lights has not yet introduced any CFL in the market! Even, it has not acquired the technology to produce CFL…… In the meantime, an engineer working in the leading rival company has secretly offered to Arabia Lights to steal and sell to it the CFL production technology, if he is paid an illegal gratification of high but affordable amount. Ted advised the MD, “Be practical” but the MD is yet to take a decision. Assume that you are the MD of Arabia Lights. As the leader of the organization, explain how you will handle the entire situation to make the Arabia Lights once again successful with all its major problems resolved. Please note that you should not respond to the case as to what you would have done on each instance if you were the MD at that time. Whatever was supposed to happen has already happened in the company. Now, in the given scenario, you should explain in detail all the things that you will do as the leader of the organization to resolve the issues and get the business back to good standing.
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Surname1
Arabia Lights Case Study
Student’s Name:
Instructor’s Name:
Course:
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As the Managing Director of the Arabia Lights Company, I will lead the employees by
example. For the company to be rejuvenated and stand back, I will get involved in activities like
strategizing the mission and vision of the organization. This would encourage the workforce to
work towards achieving the goals that they together set alongside their manager. The delegation
of duties in essential in every organization, but in cases where one is not sure of the future of the
company due to some perceived change in consumer behavior, it is always important to get
involved so that together, the organizational management and the employe...


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