Mgnt 5590 Case 5

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Week 5 Case Assignment 1. How did Electrolux Chief Executive Straberg break down barriers (an increase communication) between departments? Why did he do this? Explain. When Electrolux faced rising costs and was losing the battle of middle-market products to competitors from Asia and Eastern Europe, Electrolux’s Chief Executive Straberg had to give the company a makeover to increase communication between departments. Straberg’s strategy was to ramp up Research and Development (R&D) and ensure a single cohesive effort was being put forth amongst all the departments to collectively create innovative products. This focus to break down communication barriers between departments would influence his designers, engineers, and marketers to synergistically develop new products. Straberg also hired executives from Procter & Gamble and Pepsi who have had reputable histories of innovative ideas at their respective companies. Furthermore, Straberg wanted to battle groupthink across Electrolux’s departments. Groupthink is defined by Irving Janis as the “deterioration of mental efficiency, reality testing, and moral judgement” in the interest of group solidarity (p 282). Straberg implemented a strategy described by Ivancevich, Konopaske, Matteson to combat groupthink and by inviting outside experts to provide feedback on group practices and allowing them to propose solutions (p 283). Sessions were held with all departments brainstorm in conjunction with global consumer data from to formulate new product concepts. Before Straberg joined Electrolux, departments would not collaborate and operated in a stovepipe, linear fashion where designers would independently provide R&D the specifications for a new product. Straberg’s plan to have the departments collaborate early to develop specifications would save time and money by preventing technical problems

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