Failure Analysis Change Strategy Copy

Topics: Failure, Organizational studies, Circuit City Pages: 10 (2150 words) Published: August 17, 2015

Failure Analysis/Change Strategy
LDR/531-Team A
March 31, 2014

Successful and Failed Business Attempts
In today’s world of business there are many competitive challenges that are faced while attempting to stay relevant and successful in the business industry. Throughout this paper two companies will be discussed. The first for failing to stay relevant is Circuit City, whose attempt at remaining successful as a retail business was short lived. The second company to be discussed is Johnson & Johnson, who remained successful throughout the many years they have been in business. There are many reasons why a business may fail and many reasons why a business can become and remain successful. Part 1: Business Failure Analysis

Circuit City was one of the most influential electronics chains in the U.S. The electronics giant was founded in 1949 and remained one of the top retail outlets nation and worldwide. The primary mission of this electronics brand was to have the customers’ backs in the way Circuit City valued its customer service. This would not be the case as seen by a definite dissatisfaction from customers who looked elsewhere for their favorite electronic devices. The company was to maintain a level of integrity and a fundamental sense of keeping up with the current market in order to be successful. Since its inception in 1886, Johnson & Johnson has maintained the level of customer satisfaction for over a quarter of a century ( The vision, mission, and success are followed by a simple credo. Johnson & Johnson maintains a responsibility for the physicians, employees, families, and stockholders that have interest in the company that Johnson and Johnson has and will continue to provide quality products and services for everyone ( This is the reason for the company’s continued success. Indicators of Failure and Success

Circuit City experienced a number of indicators that would signal its failure in the corporate world like its earning losses, top management turnover and restructuring of its organizational culture. Circuit city failed to keep its revenue up due to the inability to compete with wholesale or discount stores like Wal-Mart, who had the ability to sell large electronics at close to half the price. Circuit city also had a large turnover of top management by 2007 when it’s C.F.O., Michael Foss, left the company. "This represents the third departure of a senior executive in the past six months, and the second departure of a top-five executive in the past month" (Farrell, 2007). High turnover rates in top management like those of Circuit City’s attempt to restructure itself would definitely cause apprehension amongst shareholders. Changing its organizational structure from commissioned sales to that of hourly pay rate and cutting back the sales force, by over 3,000, was also detrimental to the perception of management. Contrast to Circuit City’s failure, Johnson & Johnson have had several indicators of their continued success such as increased revenues, commitment to its vision, growth and expansion into further healthcare markets which were all complemented by its leadership effectiveness and marketing strategies. “A firm’s competitive advantage potential depends on the value, rareness, and imitability of its resources and capabilities”(Mintzberg, 2003). Founded on the mission to make lifesaving changes in the healthcare industry, Johnson & Johnson has proven their commitment to research and development from spreading “the practice of sterile surgery” (Johnson & Johnson Services, 1997-2014) down to first aid kits. Johnson & Johnson’s successful acquisition of Flexible Stenting Solutions in 2013 strengthens the vision for future expansion into healthcare markets. Despite scares with their products over the years, Johnson & Johnson displayed loyalty to consumers, stockholder, employees and healthcare staff...

References: Crosby, C. L., & Zlevor, G. (2010). Johnson & Johnson 's transformational leadership program prepares quality leaders for global challenges. Global Business & Organizational Excellence, 29(2), 19-25. doi:10.1002/joe.20305
Farfan, B.; n/d.Circuit City Mission Statement - Lost Vision Led to Bankruptcy and Liquidation. Retrieved from:
Farrell, Andrew. (2007). Departure of Foss Shocks Circuit City Investors. from
Johnson & Johnson Services, Inc. (1997-2014). Johnson & Johnson History. from
Mintzberg, Henry; Lampel, Joseph; Quinn, James Brian; Ghoshal, Sumantra. (2003). The Strategy Process. Concepts, Contexts, Cases (4th ed.): Pearson Education
Rosenberg, S., & Mosca, J. (2011). Breaking down the barriers to organizational change. International Journal of Management and Information Systems, 15(3), 139-146. Retrieved from
Stephen P. Robbins, Timothy A. Judge. (2013). Organizational Behavior, Fifteenth Edition (15th ed. ed.). Upper Saddle River, NJ: Prentice Hall.
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