Overview and Executive Summary
In this case analysis we will discuss Organizational Behavior, Decision making, Organization’s culture, Diversity, Values and leadership behavior. Today relatively small differences in performance between companies, such as in the speed at which they can bring new products or services to market or in how they motivate their employee to find ways to reduce costs or improve performance, can combine to give one company a significant competitive advantage over another. Managers and companies that use proven management techniques in their decision making and actions increase their effectiveness over time. Companies and managers that are slower to implement new management techniques and practices find themselves at a growing competitive disadvantage that makes it even more difficult to catch up. This case is all about implementing new management techniques like empowering employees and engaging in adaptive organizational culture. Simmons had the competitive advantage over competitors for almost a century. Simmons History
Simmons, a mattress manufacturing family run company, with a history of over 130 years, started manufacturing in 1876 with nine employees and a $5000 investment. Founder of the company Zalmon Gilbert Simmons in 1875 decided to change their business from wood products to woven wire mattresses, which resulted in great profits to the company. In early 1920’s Simmons had factories in Mexico City, London, and Paris with international operations which is unusual for the era. By 1936, the firm’s overall sales reached $42 million with more than 16,000 retailers carrying Simmons products. By 1978, the company was operating in 15 countries around the world and this is the time Simmons started early forms of Employee Stock Ownership Plans (ESOPs) although it was formalized in 1989. As a socially responsible company, Simmons also contributed products like bunk beds, tents, parachutes and more for solders during war situations. Simmons multiple contributions to public life and society raised the profile of the company with endorsements with public and famous figures. It also introduced programs like “zero waste” projecting its environmental responsibility. In 1975, the Simmons corporate headquarters moved to Atlanta, Georgia followed by research and development team. In 1978 Simmons ceased to be a family-run business and Theodore Greeff became the first person outside of the Simmons family to become CEO of the company and thereafter company had come across succession of many owners, leaving Simons unstable and without long term vision. This is the first point where, the fear of the unknown started among the employees and the top managers. Simmons reduced its concentration to the 18 bedding manufacturing facilities that made mattresses from start to finish with help of over 2,800 full-time employees. The most recent owners Fenway Partners bought Simmons from Investcorp in October 1998 and Charlie Eitel has been appointed the new CEO of the company as he has the track record of turning companies around. Charlie has bought about a number of changes in the organization since he assumed the office. His endeavor is to make company a place where people eager/love to work and with whom customers like to deal with.
I. Analysis and insight of Problems faced by Simmons
i. Diversity, Role of Conflict and no Organizational Structure Of several problems faced by Simmons the major problem was that there was no clear organizational structure for the company and role conflict existed. Most of the associates were reporting to General Managers who were basically Sales Managers, and according to Charlie Eitel, did not have business acumen. All the manufacturing units were running as per the General Managers whims. This Control vs. commitment situation can be clearly seen when Bob Hellyer President and Director of Simmons converse with new incoming CEO Charlie Eitel. He had a track record of...
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