Cleaver’s Sausage House

Nathaniel H. Chan

Ateneo Graduate School of Business-Iloilo Campus Regis Program

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 Cleaver’s Sausage House

Background of the Case

Allison Elam, Vice President of Operations for Cleaver’s Sausage House, was shocked

when the company’s executive committee decided not to launch the new MRP (material

requirements planning) software system her department had been proposing. David Martin, the

Chief Finance Officer of the company, aired his reservations about implementing the system and

this was supported by the other senior staff of the corporation. They cautioned that the changed

could result to a major disaster for the company. The MRP project was initially started by Stefan

Anderson, the late brother of Cleaver CEO, Jayden Anderson. Stefan bought the MRP software

prior to his illness but he was not able to see it implemented until his death in 2009. Elam was

hired to replace Stefan ten months ago and she has been singlehandedly working on the MRP

project since then. She has worked for several big companies successfully implementing MRP

systems and therefore has assured Anderson that the new system would overhaul procurement,

production and shipping, and would put order on operations. She estimated it would increase

annual cash flow by $600,000 and save up to $200,000 annually by reducing wasted material.

Prior to the executive committee meeting, she has faced roadblocks in getting the cooperation of

key managers in trying to make the new software system work. She believes that this project

was not a priority for the other VPs and department heads because of the fact that implementing

the new system will cause a major change in every aspect of operations of the company and will

result to at least 25 managers and employees to change how they did their work. She brought this

matter up to the CEO and Anderson suggested that she form a cross-departmental task force to

assist her but she dismissed this idea because she believes a task force will only slow her down.

After the no-go decision of the executive committee, Allison Elam, a pleasant, reserved

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individual who shuns conflict, will now have to plan a course of action to push for the

implementation of the MRP system.

Definition of the Problem

There are several problems that can be identified in this case. The primary problem

stems from the resistance to change of some of the top management of the corporation. This

may have resulted from several factors, including the following; 1) Self-interest on the part of the

other vice presidents and department heads because the new software system might increase or

change the workload of their respective departments. They might also be suspicious of the true

motive of Elam in pushing for the implementation of this program because she might use its

success to increase her political clout in the organization. 2) Lack of understanding and trust on

the part of the other members of the executive committee as to what tangible benefits the

program will give to the corporation. The previous experience of the director of logistics, Susan

Frisch, who has a negative experience with a similar system in her previous employers further

adds to this mistrust in the new system. They might also not be aware of the real purpose of the

new technology being introduced because of the lack of coordination with the other departments

regarding this project. The fact that Elam has been with the corporation for only a very short

span of ten months coupled with her seeming lack of rapport with her colleagues, the task of

putting her in charge of implementing a major organizational change could have further

intensified the resistance to the program. 3) The uncertainty that the new technology brings also

contributes to the resistance of Elam’s colleagues. They might be wary that the new system

might result to loss of jobs because of the promised efficiency that it will bring to the system. 4)

The different departments might assess the benefits of the new technology differently from Elam

as this can also affect their own departmental goals. For example, the vice president of sales

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doubted whether the MRP system could really deliver on its promise of improving sales forecasts

and increasing cash flow. He even voiced out his concern that it might cause shortages of raw

materials thereby affecting the sales target of his own department.

Another problem in this case is the lack of horizontal coordination among the different

departments of the organization. The highly vertical functional structure of the organization

promotes barriers between departments which lead to poor communication and lack of

cooperation between departments. A highly vertical functional organization responds slower to

innovation and change. In the case of Cleaver’s Sausage House, the MRP software system has

been left unused for a long time because an innovative technology needs the involvement of

several departments which in this particular project was not evident. This was further made

worse with Elam’s style of working on the project by her lonesome.

The last problem in this case is the seemingly lack of overt support of top management,

especially of the CEO, in pushing for the implementation of the program. For an innovation or

change to succeed, top management should be seen to verbally and symbolically support the

initiative. Elam plays the role of the champion in this case but Anderson should also play the role

of a sponsor, a high-level manager who approves, protects and removes barriers in the

organization so the innovative technology may be implemented. The visible support usually

helps overcome resistance. In the case, although Anderson seems supportive of the MRP

program, he does not go out of his way to show his all-out support to Elam.

Objectives for Problem Solution

The main objective in this case is to address the problem of resistance to the MRP

software system by the executive committee of the corporation. Adequately addressing this issue

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will help in the smoother implementation of the proposed program. We also need to address the

problem of poor coordination and collaboration between the different departments of the

corporation because improving horizontal linkages will help in breaking down barriers and

weaken the resistance to change. Furthermore, we should also address the issue of top

management support as most innovations do not succeed unless there is full support and

involvement from the top. This will also help in addressing the main problem of overcoming

resistance to the project.

Alternate Courses of Action

Allison Elam as the champion of the MRP software system believes in the program and

knows the benefits that the implementation of the said program will bring to the corporation.

However, she must confront the obstacles that are going against the launching of the system as

well as obtain the political support and cooperation within the organization for the project to

work. She must therefore identify the reasons for the resistance to the project that she is

encountering within the organization and come up with strategies and alternative actions to

overcome this problem. There are two approaches in overcoming resistance, the analysis of

resistance through the force-field technique and the use of selective implementation tactics.

In doing the Force-field analysis, she must identify the driving and restraining forces to

change. In this case, the driving forces that support the implementation of the MRP system is the

projected increase in annual cash flow of $600,000 and the annual savings of $200,000 from

reduced wasted material. Another driving force is the anticipated increase in efficiency for

procurement, production and shipping thus improving discipline in the operations of the

corporation. The restraining forces are the resistance of the other vice presidents and department

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heads to the new system, the lack of communication and coordination between the different

departments, and lastly, the lack of symbolic and verbal support of the CEO of the corporation to

the new system. She must therefore remove or reduce these restraining forces so that the driving

forces will be strong enough to allow implementation. As mentioned, resistance to change is one

of the strongest forces that restrain the launching of the system. Elam must therefore be able to

identify the causes of this resistance. The identified causes of resistance as previously

enumerated include the self-interest of the other members of the executive committee, the lack of

understanding and trust of the new system that is being introduced, the uncertainty that the new

system will bring and the differences in the assessments and goals about the project of the

different stakeholders. Elam must address all these issues if she wants to reduce resistance.

Being relatively new in the corporation, she is still not very familiar of the culture and politics in

the organization. Therefore, she must improve her relationships with the other stakeholders

through constant communication and dialogue to be able to win their trust and convince them

that she does not have any hidden agenda with regards to the implementation of the new system.

To promote understanding and trust of the new system, Elam must educate the other vice

presidents and department heads of the advantages and benefits that the new system will bring to

the organization. She can even ask for the help of the software developers where the system was

bought to give lectures to the other stakeholders so they may better understand the new system.

If they are more knowledgeable of the new system and they are able to see its benefits and

advantages, the more Elam can convince them to give their support for the launching of the

system. Elam can also allay the fears of the members of the executive committee and the

involved employees that the system will even make their work easier. To further reduce

uncertainty, she can also ask for the commitment of the CEO that not a single employee will lose

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his job because of the implementation of the new system. To harmonize the way Elam and the

other top management people assess the situation and for them to come up with shared goals,

Elam must make sure that horizontal collaboration happens. The solution to this problem will

also address the second restraining force which is the lack of communication and coordination

between departments. Although Elam may not have any authority to initiate a change in the

structure of the organization which is strongly vertical and functional, she can probably heed the

advice of the CEO to create a cross-departmental task force to promote horizontal integration and

collaboration. Through the creation of this task force, better communication and coordination

between departments will happen and this will result to reduced conflict, creation of a common

goal and purpose, and completion of the organizational task at hand, which is to implement the

new system. The final restraining force that Elam must reduce or eliminate is the perceived weak

support of the CEO to the new software system. Since Elam has been with the corporation for

only ten months, she can still be considered an outsider by the other members of the executive

committee. Because of this, she needs the strongest show of support that she can get from the

CEO to push forward her agenda of implementing the new software system. She must talk to

Anderson regarding this and she must get his unequivocal backing to push the launching of the

MRP. She will play the role of the champion of the innovative technology but he must also play

his role as the sponsor of the project. If Elam will be able to successfully remove or reduce all

these restraining forces, she will be able to effectively push for the implementation of the system.

The problem that Elam might encounter with this approach of reducing all the restraining forces

is her reserved and conflict-averse personality. She may not have enough political goodwill in

the organization and the charisma to be able to reduce all the restraining forces against the MRP

system.

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 The other approach to overcoming resistance to change is by adopting the following

specific implementation tactics, 1) communication and education, 2) participation, 3)

negotiation, 4) coercion, and 5) top management support. Since the resistance to change by

members of the executive committee maybe due to lack of solid information about the change,

Elam can change their stand by speaking to their hearts (touching their feelings) as well as to

their minds (communicating facts). She can reach out to each one of them explaining the

benefits and advantages of the system as well as to build relationships which is crucial to her

purpose. The only problem is Elam’s attitude herself that she wants the program implemented

immediately so she may not have the patience to wait for this slow process of winning them over

to her side. She can also try to use the tactic of participation by involving everyone in planning

out the implementation of the MRP. This will allow all stakeholders to better understand the

whole process of the system and to voice out their suggestions and criticisms. This will give

them a sense of involvement in the project so they can also own it up. For this purpose, the

creation of a cross-functional team is most ideal. The drawback is the length of time that this

process will take and the lack of support that Elam has in the organization at this time. The third

tactic that she can utilize is negotiation. This is a more formal process of getting cooperation.

She can ask for a new meeting of the executive committee where she can again do a detailed

presentation of the MRP system and try to bargain for its implementation. She must be prepared

to compromise in this kind of implementation tactic. However, the fact that she already lost out

and failed to get the needed support during the last executive committee meeting, using this

tactic at this time appears to be a losing proposition. She can also explore the possibility of using

coercion in pressing for the MRP system. This method however is more effective in a crisis

situation to force people to accept change. This may not be effective for her purpose in the long

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run because the organization is not in a crisis and she will further alienate herself from the rest of

the top managers. Lastly, she can ask for top management support to help implement the system.

Top management support has been found to be very crucial in the reduction of resistance to

innovations and changes in most corporations. Elam must make sure that Anderson understands

the MRP system himself and he will give his visible support to its implementation. However,

top management support will not work if the other vice presidents, department heads and

employees will feel that they are being forced to accept the new program. Therefore, this tactic

must be combined with the other tools like communication and education as well as participation

to make it more effective as a long term solution.

Conclusion

From the different alternate courses of action that Elam can take, the best option for her is

to do a force-field analysis to determine the driving and restraining forces for and against the

MPR software system. If she is able to have a better understanding of the reasons why her

initiative failed, she will be able to come up with a more focused action plan that will address

each and every issue that got in the way of the successful launching of the new system. This is

the more holistic way of dealing with the problem instead of the piece-meal solutions offered by

the other alternatives. Since Elam is relatively a new hire and is still considered an outsider in

the organization, she can ask for the help of Anderson by explaining to him all the things that

needs to be done as shown by the force-field analysis and get his all-out support in pushing for

the program. She can convince him to take the initiative in forming a cross-functional team

instead of having her do it so that the other vice-presidents and department heads will be able to

realize the importance of the program to the organization as well as remove the negative bias

which they surely will have if she is put in charge of the cross-functional team. Through this

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cross-functional team, Elam will now have the chance to better explain the new system,

emphasize its value to the corporation, allay their doubts, and also help improve her relationships

with the other members of the team thereby increasing the chance of support for the project. The

other alternative courses of action do not offer the same breadth of answer to the problem

because they address only a part of it and not its entirety. Therefore, they pale in comparison to

the chosen course of action in terms of totally addressing the problem of resistance to the

innovative technology being introduced in the company.

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Reference:

Daft, RL. (2016). New Era Management. 11th Edition.

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