innovation and org transformation 3

Elizabeth Stover was the president of Stover Industries, an amalgamation of several small companies in the electrical parts industry. She and her husband had inherited part of the group from her father-in-law, and Stover, an engineer, elected to run the company while her husband pursued a separate career as a dental surgeon. In addition to the inheritance, Stover had purchased three other companies to create the present Stover Industries. Only 31 years old, Stover was a dynamic individual, full of ideas and drive. In the space of a year she had welded Stover Industries into a profitable organization known for its aggressiveness.

Stover integrated the four companies into a unified organization by merging the individual management groups into one unit. Some individuals in each organization had been released at the time of purchase, and, in other instances, executives of the newly purchased companies resigned because of difficulties in working for such a young and driving boss. The four plants continued as individual manufacturing units of the company, and together employed approximately 475 production workers.

Problems arose in integrating the sales staffs, because the original companies had competed with one other, and, the salesmen had overlapping territories. This was gradually being worked out; but the salespeople were permitted to keep their own pre-existing customers, which made it difficult to assign exclusive territories to each salesperson. The sales staff included 17 sales representatives and the director, who. had been with the original Stover company as sales manager. He knew Elizabeth Stover well and was a trusted lieutenant but served as little more than titular head of the sales force. He devoted most of his time and energy to routine direction and coordination of the sales team. Stover herself provided the active leadership.

It was Stover who hired the 18 and newest sales representative — Chris Cunningham, who had been one of Stover’s college classmates. Cunningham shared some of Stover’s drive and enthusiasm and soon justified Stover’s choice with a sensational sales record. Despite this sales success, Cunningham represented a thorny problem for Stover. She described the problem in the following fashion:

I hired Chris because we knew and admired each other in our college days. Chris was always a leader on campus, and we had worked well together in campus affairs. Chris was just the kind of person I wanted in this organization–a lot of drive and originality, combined with tremendous loyalty. The way I operate, I need a loyal organization of people who will pitch right in on the projects we develop. Chris has already been proven a top-notch performer and will probably be our best salesperson in a year or two. Could one ask for anything better than that?

Here is where the rub comes in. Chris is the sort of person who has absolutely no respect for organization. A hot order will come in, for example, and Chris will go straight to the plant with it and raise hell until that order is delivered. It doesn’t make any difference that our production schedule has been knocked to pieces. The order is out, and Chris has a satisfied customer. Of course, that sort of thing gets repeat business and does show well on Chris’ sales record. But it has made running our plants a constant headache. It is not only the production people who have felt the impact of Cunningham on the operations. Chris gets mixed up with our engineering department on new designs and has even made the purchasing department furious by needling them to hurry supplies on special orders.

You can just imagine how the rest of the organization feels about all this. The other salespeople are pretty upset that their orders get pushed aside–and are probably a bit jealous, too. The production people, the engineers, the purchasing agent, and most of the rest of the staff have constantly complained to me about how Chris gets in their hair. On a personal level, the staff say they like Chris a lot but that they just cannot work with such a troublemaker in the organization.

I have talked with Chris many times about this. I have tried raising hell over the issue, pleading for change, and patient and rational discussion. For maybe a week after one of these sessions, Chris seems like a reformed character, everyone relaxes a bit, and then bang–off we go again in the same old pattern. I suppose that in many ways Chris is just like me–I must admit I would probably be inclined to act in much the same way. You see, I have a lot of sympathy for Chris’ point of view.

I think you can see now what my problem is. Should I fire Chris and lose a star salesperson? That does not make too much sense. In fact, Chris is probably the person who should be our sales director, if not immediately at least in a few years. But without the ability to get along with the organization, to understand the meaning of “channels” and “procedures,” Chris is not only a valuable and talented addition to the company, but a liability as well. Should I take a chance on things eventually working out and Chris getting educated to the organization? Should I put on a lot of pressure and force a change? What would that do to Chris’ enthusiasm and sales record? If I just let things go, then, there is a real danger to my organization. My executives will think I have given Chris the green light, and they will transfer their antagonism to me. I certainly cannot afford that.

Discussion the following questions in three or four paragraphs:

1.What are the key structural and HR issues that you see in the case?

2.What options (provide two or three) should Elizabeth Stover consider for dealing with this situation?

3.What do you recommend that she do to solve the immediate problem and effectively lead the company’s growth and development going forward?