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Question

Assessment structure (2500 words)
•Introduction (approx 250 words)
•Literature review (approx 1000 words) What theories are there related to context? How do they apply? Take each one in turn
•Analysis of the implications of the application of the theories to the case study (approx 1000 words) What are the advantages and disadvantages of using these theories in the case study – what are the implications of using them?
•Conclusion (approx 250 words)

Answer

Contents

Introduction. 2

Literature review.. 2

Literature on types of power 3

Implications for the case study: USA. 3

Implications for the case study: Europe. 3

Literature on culture. 4

Advantages and disadvantages of Hofstede’s model 5

Implications for the case study: USA. 5

Implications for the case study: Europe. 6

Literature on gender 7

Implications for the case study: USA. 8

Implications for the case study: Europe. 8

Literature on sector theory. 8

Implications for the case study: USA. 9

Implications for the case study: Europe. 9

Conclusion. 10

References. 11

 

Introduction

At Griffin Motor Manufacturing Company, a number of contextual issues influenced the decisions that the company’s top executives in the USA and Europe made during the 1990s. Griffin had just recovered from massive losses amounting to millions of dollars incurring during the 1980s. The losses were incurred simply because of a miscalculation by the company. The company’s managers both in Europe and the US had to make a strategic decision on how to address the issue of organizational sub-cultures with a view to transform the organization.

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The aim of this case study is to discuss theories relating to the context in which Griffin Motor Manufacturing Company operated during the 1990s. The paper also analyzes the implications of the application of the theories to the case study. In this regard, the advantages and disadvantages of using these theories in the case study as well as the implications of using them are examined. Focus is on the implications as far as differences in the US and European operations are concerned. On this basis, the paper provides a conclusion relating to the importance of organizational context for effective leadership.

Literature review

One of the theories that can explain the organizational contexts in which Griffin Motor Manufacturing Company operated its US and European arms is French and Raven’s (1959) typology on types of power. Hofstede’s (1980) dimensions of national culture can also explain the differences between the national cultures in Europe and the US national culture. On the other hand, the theory of gender can provide crucial insights into horizontal and vertical segregation at Griffin. Moreover, the sector theory can enable researchers understand the implications of various sectors on organizational leadership. Each of these theories has advantages and disadvantages as well as implications within different organizational contexts.

Literature on types of power

According to French & Raven (1959), there are four main types of power; namely position power, coercive power, referent power, and personal power. Position power is the power that a person holds due to his role within the organization. He gains new contacts, uses legitimate authority to his advantage, and maintains control over crucial information. In contrast, coercive power entails the use of privileges and sanctions to achieve the desired goals. Referent power is achieved when members within an organization express admiration and respect for the position being held by an individual. Lastly, personal power is achieved through the efforts of the individual, for example the acquisition of knowledge, skill, or technical expertise.

Implications for the case study: USA

Different organizational leaders tend to choose different types of leadership depending on their abilities, character traits, and organizational contexts, at Griffin, Rob Rabsen, the company’s chairman, opted to use visionary leadership to transform the American arm of Griffin. In this type of leadership, he used a participative approach in which position and referent power was needed in efforts to engage with the feelings of people within the organization. In contrast, Henry Rolling, Griffin’s president, used a transactional style of leadership, with his objective being to ensure that his position power was aligned with the goals of the organization. By complementing each other with different leadership styles, Rabsen and Rolling were able to achieve a balance.

 

Implications for the case study: Europe

In Europe, Griffin’s director Bob Mayden used position power in a bid to achieve the goals of the organization. In this regard, emphasis was on strengthening management power and controlling the manufacturing function. According to Welbourne (2000), position power is based on the need to safeguard the influence and authority that comes with an office or position. The person who occupies this office or position therefore becomes a symbol of power, authority, and influence. Mayden was keen to avoid using personal or referent power.

Jayasingam (2010) argues that proper use of personal and referent power can enable managers exert influence among their subordinates and to promote organizational goals. According to Jayasingam (2010) these two types of power are widely regarded as a crucial source of social capital for the organization. Not only does the manager get the job done, he also succeeding in winning the goodwill of his subordinates. The same thing may be said regarding transformation leadership, in which the leader is required to put into consideration both the needs of the staff and those of the organization.

Literature on culture

Culture is also a crucial consideration in efforts to analyze the organizational context in which Griffin operated during the 1990s. Hofstede (1980) developed a theoretical model comprising of five cultural dimensions; namely power distance, individualism versus collectivism, uncertainty avoidance, long-term versus short-term orientation, and masculinity versus femininity. Power distance

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Power distance refers to the degree to which there is an expectation among less powerful individuals in society to accept their position and maintain a perception that power will continue being distributed unequally. On the other hand, the dimension of individualism versus collectivism assesses preferences for either a loosely-knit or close-knit social framework. Uncertainty avoidance is the dimension that examines the tendency by individuals in a society to be uncomfortable whenever they are confronted with ambiguous and uncertain situations. In contrast, the dimension of long-term versus short-term orientation addresses the search for virtue in society. Lastly, masculinity versus femininity is the dimension that examines the drive for achievement, assertiveness, heroism, and material reward upon achieving success.

Advantages and disadvantages of Hofstede’s model

Hofstede’s (1980) model of cultural dimensions is advantageous in many ways. First, it has created a platform through which cultural aspects of organizational operations can be analyzed. Secondly, it enables researchers adopt a comparative approach in investigating the impact of different national cultures on organizational performance. Thirdly, the theory provides a wealth of information regarding the ways in which different national cultures operate and the possible impact on the operations of an organization. The ability to assess a national culture in the context of an organization makes it easy for managers to look for ways of adapting to new cultural contexts.

However, Hofstede’s (1980) theory has some disadvantages as well. First, in many instances, it is difficult to place the dimensions in real-life contexts, particularly in the case of dimensions that require an analysis of two polar ends of a social attribute (Fang, 2003). It is rather difficult to determine whether to place a national culture in one end of the continuum or the other. Secondly, it is also common for controversy to arise in multicultural contexts where conflicting cultural characteristics are inherent (McSweeney, 2002).

 Implications for the case study: USA

In the case study, it is evident that cultural consequences constituted a major factor in determining the way forward for Griffin. The company had to change its culture by breaking down various barriers. Most of these barriers were being posed by horizontal differentiation. In this environment, departments operated independently of one another. To address this problem, a participative management approach needed to be adopted. In this regard, the objective was to break down the subcultures that had been nurtured in the context of the functional structure.

The managers of the US arm of Griffin focused a lot on narrowing the existing power distance. This was achieved by flattening the organizational structure, thereby encouraging more involvement among members of the organization. In terms of uncertainty avoidance, the objective was to ensure that everyone working in the company was prepared to take risks. At the same time, the company’s leadership paved the way for a shift from a predominantly masculine approach to a more feminine approach. Finally, the company’s leadership appreciated the need to promote long term orientation characterized by increased emphasis on people and participation.

Implications for the case study: Europe

In Europe, the culture is slightly different, whereby senior management has a critical role in driving cultural dynamics. At the European arm of Griffin, the changes that had already been put in place in the US took a longer time to introduce. Few people were willing to challenge the traditional methods of decision-making by top management. Many members of the company were concerned about its financial position in the European market. Therefore, they ended up increasing performance with a view to achieve scale economies and ultimately achieve an improvement in overall performance.

Power remained in the hands of senior managers. The top executives of the company felt that the introduction of a new organizational vision and mission was not a priority in the European context. Instead, most of their concerns were directed towards transactional leadership. Bob Mayden’s top position remained unchallenged for a long time. This means that no balanced approach was adopted like in the case of the US arm of the company. This essentially translates into a top-down approach to decision-making. The aim of maintaining strict management control was to reduce costs.

In the company’s European operations, the element of uncertain avoidance is evident. The company failed to recognize different European cultures. This means that its top managers wanted to avoid uncertainty in terms of day-to-day as well as long-term operations. Similarly, Griffin did not change its masculine approach to business operations. It is also evident that the European division of Griffin focused on short-term profits rather than long-term improvement in cultural environment. The company had to wait until Mayden took on a different position for it to introduce a new leadership cadre.

Literature on gender

In gender theory, the traditional thinking is that organisations have characteristics that favour males in senior management. Ordinarily, it is assumed that deliberate efforts will be introduced by organizations that value equality with a view to enable women ascend to senior management positions (Liff, 2001). According to Liff (2001), such efforts are being undertaken in order to remove the “glass ceiling” that tends to prevent women from progressing beyond a certain point in their careers.

Literature also suggests that although many organisations may not be structured along gender lines, they may be indirectly favouring males (Alvesson, 2009; Oakley, 2000; Acker, 2006). Indirect discrimination against women occurs in situations where legal standards and policies that are apparently neutral lead to consequences that affect women negatively in the workplace. For example, in many construction firms where intense manual work that is traditionally the reserve of men is being done, female toilets may be non-existent (Acker, 2006). Although this act of omission does not seem to discriminate against women it contributes immensely to the cultural norm in which women are not expected to be employed as construction workers (Acker, 2006).

Implications for the case study: USA

At Griffin, all senior managers are male. However, in the US, a new trend has emerged whereby a more feminine approach is being adopted. This approach is characterized by a participative, caring leadership style that put into consideration employees’ feelings. This is a reflection of changing perceptions towards masculinity and femininity in the US culture. It may also be an indication that Griffin is working towards transforming its organizational culture to ensure that every employee feels that his or her needs are being taken into consideration in all decision-making processes.

Implications for the case study: Europe

In Europe, Griffin is dominated by an autocratic male leader at the helm. It seems that no consideration is being made to the emotions and feelings of individual employees. The only thing that seems to matter is profitability. Such an approach is likely to have a negative impact on productivity. Employees may develop a negative attitude towards the organization because of concerns that their wellbeing is never considered a priority in the wider scheme of things.

Literature on sector theory

In the sector theory, efforts are being made to highlight differences between the public sector and private sector (Frumkin, 2010). The public sector is characterized by a greater level of bureaucracy characterized by procedures, rules, and control mechanisms aimed at ensuring that the goal of accountability is achieved (Fernandez, 2006). This bureaucratic control poses more limits on individuals’ ability to lead. For example, it limits the ability by transformational leaders to take more risks (Rauch, 2000).

In contrast, the private sector is characterized by fewer organizational constraints. As long as the actions being undertaken are legal and ethical, no major restrictions are imposed by the founders of the private organizations. The founders are more interested in ensuring that they create an environment that facilitates creativity, innovation and transformation. In fact, according to Ashworth (2009), risk-taking behaviours among senior managers is a desirable leadership trait in the private sector.

Implications for the case study: USA

The Griffin case study demonstrates that private sector organizations encounter numerous challenges in efforts to synchronize their operational strategies. The European division of the company was negatively affected by the local culture that focuses on accumulation of power at the top of the leadership hierarchy. This culture contrasts sharply with that of the USA where local culture is more permissive to a feminine approach to leadership. In other words, sectoral differences pose a major challenge to the private-sector companies. Organizations that operate in the public sector are able to overcome these challenges because of the bureaucratic structures that are compelled to adhere to.

One may argue that the USA division of Griffin ended up becoming more like a public sector. This is because it started taking more accountability for actions while at the same time ensuring that people were subjected to less control. The US division was also able to overcome the organizational complexities that often act as a hindrance to day-to-day operations as well as the formulation of long-term strategies.

Implications for the case study: Europe

In Europe, Griffin’s operations resemble those of a typical private-sector organization in which most of the power is vested in senior management. In such organizations, lower-level managers and supervisors tend to take a very insignificant role in the decision-making process. Very few opportunities for people to share ideas regarding day-to-day running of the company exist. Instead, such companies focus on enticing employees to contribute to the strategies being pursued by the top management through competitive salaries, career stability, internal promotion, as well as meritocratic recruitment. Such companies are highly likely to overlook aspects such as diversity, country income in order to attract the most talented workforce through attractive terms of employment (Cohen, 2001).

Conclusion

This paper has examined the case study of Griffin Motor Manufacturing Company. The analysis provided is based on a literature review that covers issues of types of power, culture, gender, and sector. Griffin went through turbulent times characterized by huge losses during the 1980s. During the 1990s, concerted organizational efforts were required to put the company back on track. In this paper, it is assumed that an analysis of the company’s US and European divisions can provide crucial insights into the aforementioned theoretical aspects. Through an analysis of literature and an assessment of its implications for the company’s operations, it is evident that the theories of power, gender, sector, and culture have a critical role to play in enabling managers understand the environment in which they pursue the goal of organizational transformation.

The national culture of the USA differs remarkably from that of Europe. This difference had a huge impact on the way Griffin pursued the objective of getting back towards the path of profitability. In Europe, the local culture favoured an organizational model in which power was concentrated at the top. In contrast, a horizontal approach was more acceptable in the US culture. Similarly, a feminine approach to management was adopted in the US while its polar opposite (masculinity) was more culturally acceptable in Europe.

In conclusion, understanding the organisational context is important for effective leadership but this becomes more complex across cultures in a dynamic and changing environment. Contexts change over time and leaders need to understand the wider picture but also take account of followers needs as well.

 

References

Acker, J 2006, ‘Inequality Regimes: Gender, Class, and Race in Organizations’, Gender & Society, vol. 20, no. 4, pp. 441-464.

Alvesson, M. 2009, Understanding gender and organizations, Penguin Books, New York.

Ashworth, R 2009, ‘Escape from the Iron Cage? Organizational Change and Isomorphic Pressures in the Public Sector’, Journal of Public Administration Research and Theory, vol. 19, no. 1, pp. 165-187.

Cohen, S 2001, ‘A Strategic Framework for Devolving Responsibility and Functions from Government to the Private Sector’, Public Administration Review, vol. 61, no. 4, pp. 432–440.

Fang, T 2003, ‘A critique of Hofstede’s fifth national culture dimension’, International Journal of Cross-cultural Management, vol. 3, no. 3, pp. 347-368.

Fernandez, S 2006, ‘Managing Successful Organizational Change in the Public Sector’, Public Administration Review, vol. 66, no. 2, pp. 168–176.

French, J & Raven, B 1959, The bases of social power, Blackwell Publishing, New York.

Frumkin, P 2010, ‘Institutional Isomorphism and Public Sector Organizations’, Journal of Public Administration Research and Theory, vol. 14, no. 3, pp. 283-307.

Hofstede, G 1980, Culture’s Consequences: International Differences in Work-Related Values, Sage Publications, Beverly Hills.

Jayasingam, S 2010, ‘Influencing knowledge workers: The power of top management’, Industrial Management & Data Systems, vol. 110, no. 1, pp. 134 – 151.

Liff, S 2001, ‘Distorted Views Through the Glass Ceiling: The Construction of Women’s Understandings of Promotion and Senior Management Positions’, Gender, Work & Organization, vol. 8, no. 1, pp. 19–36.

McSweeney, B 2002, ‘Hofstede’s Model of National Cultural Differences and their Consequences: A Triumph of Faith – a Failure of Analysis’, Human Relations, vol. 55, no. 1, pp. 89-118.

Oakley, J 2000, ‘Gender-based Barriers to Senior Management Positions: Understanding the Scarcity of Female CEOs’, Journal of Business Ethics, vol. 27, no. 4, pp. 321-334.

Rauch, J 2000, ‘Bureaucratic structure and bureaucratic performance in less developed countries’, Journal of Public Economics, vol. 75, no. 1, pp. 49–71.

Welbourne, T 2000, ‘The Roles of Departmental and Position Power in Job Evaluation’, Academy of Management Journal, vol. 43, no. 4, pp. 761-771

 

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