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Background

Bob Rondell started the Rondell Data Corporation in 1920. The basis for its inception was Rondells
invention of several electrical testing devices, while on staff as an engineering faculty member of a large
university. In 1947, the company entered into theradio broadcasting equipment market. By the early
1960s, the company had increased its business to include data transmission equipment. The company
had a reputation of being a source of high quality innovative designs and described itself as being able to
convert problems to solutions in their sales brochures. Being relatively small, Rondells competitive
edge is its ability to innovate and deliver what the customer wants. By 1978, two major lines were
recognized: broadcast equipment and data transmission. Broadcast equipment accounted for 35% of the
company sales. Data transmission was also blossoming with increased demand for highly specialized and
innovative designs.

Structure of the Engineering Function

Much of the growing dissatisfaction at Rondell Data Corporation can be traced back to the inefficiencies
that arise from Rondell's outdated organizational structure. The organizational structure at Rondell
follows a strictly functional approach. The functional areas are divided as Production, Sales, and
Engineering. Since Rondell started out as a small firm that worked on custom solutions, this model served
it well in its initial period. However, as Rondell has experienced major expansion, this same structure is
now seriously inhibiting Rondell's future growth.
Relying on personal relations, Rondell lacks the cohesive and clearly organized structure required of a
larger company.

Organizational Culture:
The organization has developed many silos of different cultures with production department really
isolated and the design department really dominates the entire organization. Rondell prided itself on a
close family tradition and yet, Rondell was faced with a culture of uncooperativeness among its different
departments. The conflict between the founding values and the values that had developed were very
visible in the behavior of the staff at Rondell. Growth has put significant strain on the informal
relationships of the past. There are now significant strains between the production, engineering and sales
departments.Not only was there little cooperation, but blame was placed on others for the current lack of
success. For several years, the firm had experienced a steadily increasing number of disputes between
research, engineering, sales, and production people. Each department, using a high external locus of
control, found reasons to blame the other departments for Rondells decline in profitability.
The design department headed by Doctor Reeves is focused on designing clever designs, but these are not
generally production ready with a lot of bugs in them and are designed with little understanding of the
manufacturing complications and because of this, they often miss the set deadlines. The department is
backed by the president, Hunt who is designed focused and is very reliant upon the Doctor and doesnt
appreciate manufacturing and engineering departments reservations against design department.

Due to the growing disputes amongst the design, engineering and manufacturing departments, the sales
department run by Porter has become increasingly agitated due to deadlines not being met and
unsatisfactory customer complaints. Due to last minute changes in design, the products are often not
technically sound due to which they perform below par.

Issues/Problems:

Current Situation
Forbus was appointed as the Director of Engineering department by the organization after it fired the last
director. Before Forbus, three Directors had been appointed and let go after only being with the company
for a short time. Forbuss immediate tasks include resolving the pre-production issues as well as to sort
out the bad will the last director had generated, but he is in a relatively weak position to do so.

Franks Problems
The issue with Franks position is that he hasnt been provided full authority of exercising his powers to
implement process changes because he doesnt have the backing of the President who is design focused
and has a soft spot for Dr Reeves.
Further to this his department is decentralized which makes it ever more difficult for him to take control
and establish himself as a leader. The personnel under him are scattered throughout the manufacturing
and designing areas and they are not completely loyal to him
Moreover, his personnel seem to lack the motivation due to being used below capacity. If this issue is not
dealt with quickly then it can lead to attrition and low morale which will result in poor performances as
job satisfaction will be low.
His department lacks the organizational power which is in one way related to the lack of authority given
to him by the President. Plus, since the personnel are scattered in other departments, there seems to be a
lack of team spirit and loyalty.

Other Issues
One of the most significant issues facing the Rondell Corporation in relationship to the structure of the
company is the fact that the entire performance system enabled, and indeed seemed to encourage,
individuals to see their own performance as separable from the enterprise as a whole. In an organization
with many product lines, functionally structured organizations can lose track of the importance of
individual products or new product development efforts and fail to provide the functional integration
needed.

Another example of the problems caused by functional design and centralized decision making is Dave
Schwabs Thanksgiving review of the 802 prints. Dave Schwab reviews the prints and makes decisions
that are not within his scope. A statement from Dave Schwab about tolerance crazy engineers indicates
that people in the wrong function are making the decisions. Since a design engineer doesnt fully
understand the manufacturing capabilities, involving a manufacturing representative on a project team
would improve the process by taking into account both design needs, as well as manufacturing needs.
Because culture is the focus for an organizations strategies, Frank Forbus failed to see that before he
would be able to have any effect on the strategies at Rondell, he would need to change the culture.
Classic machine bureaucracies, with their reporting structures too rigid to adapt to faster-paced change,
have to be unfrozen to be improved. Frank was not able to empower himself or obtain managements
empowerment to begin the process of changing the culture at Rondell.

Recommendations:
Formal structures were needed along with a breaking down of the silos that had been formed by
the functional groups.
Recommend the Executive committee to roll out incentives to hit schedules and meet deadlines
across the entire company. This would motivate and improve performance and reduce the
problem of extended deadlines.
Generate a report of all the organizations departments performance and shortfalls and discuss
with Executive Committee, who should then put their foot down to counter all the problems. This
will bolster Franks position and improve the current organizational culture.
An integrated team would consist of representation from design, purchasing and manufacturing
who would be better equipped to make such a call as design changes versus an individual
Director like Dr Reeves because they would make a the decision based on all relevant aspects.
Retain the services of a qualified consulting team to help the management team.
An Organizational Design process should be initiated to determine the best organizational
structure for the company. Our assumption is the new organizational structure will be product
line focused.
A cross-functional approach should be taken to accomplish key company tasks such as new
product development.
Decisions should be pushed down into cross-functional teams who have the responsibility for
delivering a timely, quality and manufacture-able product.
Teambuilding should be a priority at Rondell with the stoppage of the constant finger.
Organizational wide efforts should be made at breaking down functional barriers and creating an
environment of team participation and decision making.
Engineering Services should add a project management function to aid the team in coordination,
planning and monitoring project progress.
Hi tech communication should be implemented to avoid delays and mis-communication.