Lack of internal communication apparent within organization

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Answer the 10 questions listed below and include appropriate rationale and case evidence to support your answer. Answer each question and sub-point. Consider all 4 major gaps for Base Station when answering the questions. Ask "why" to get to the root causes.


1. Are the problems caused by the design of certain work, jobs, or tasks?

Problems are being caused by the design of the work because Enerstasis does not allow customization and yet one sales person (Stan Rummel) is asking for customized orders and Wahid Karim is doing the customization. Engineering Department accepting product customizations without consulting with Manufacturing to make sure enough parts are available

Inconsistency as demonstrated by the line production report shows several days in which no units were produced on several days.

The sales department is unaware of the impact on the production department when customization is asked.

Processes are inefficient as is demonstrated by the fact that there are an increasing amount of units on backorder without a corresponding rise in sales

Compensation is based on units sold, not delivered or delivered on time. One of the reasons that customers are not happy is that their products are not being delivered on time. There is no component of customer satisfaction tied to this as well.

No customer service measurement or feedback loop. It seems that the closest measurement of this is the renewal of contracts, and this has been declining.

Upper management not following Ethical approaches as to hiring new personnel and working with the existing one

Lack of reinforcement of work guidelines on employees

Division Head not keeping up with Malaysian Government work regulations

Overall company's efficiency has declined


2. Are the characteristics of people causing the problem(s)?

There are multiple people characteristics that are causing problems. We are going to focus on problems in the Chicago office and how the characteristics of people in Malaysians plant also are causing problems.


Ron Turner- has neglected relationships with Malaysian government and endangering Enterstasis operation in that country. Instead of trying to convince and offer candidates convincing facts to join the company, he keeps on making excuses instead of fixing the problems directly

Lily Crofton-She needs to assert her authority manager and offer consequences to her employees under her and follow through. She needs to apply guidelines and structure to her workplace or she faces the lost of respect from her whole team

Stan Rummel- Has to be disciplined for his lack ethics and undermining of management. He has no respect for his other coworkers and knows no boundaries to make a sale. He uses his friendship with Henry to get out of any problem. His success in sales puts the sales department, engineering and manufacturing under stress. Sales associates are frustrated with him and opted to quit due to his behavior and the lack of reinforcement of workplace guidelines.


Reuben King- needs to get into his department and set the guidelines if he wants to get anything accomplished. He needs to help build the employees morale and offer solutions. Apply more consequences to unethical behavior and get to work hand-in-hand with the engineering department.

Wahid Karim- He needs to communicate better with the manufacturing department so the products can get on their way efficiently. Also, he needs to be more aware of the parts that go into design and verify in they are available before deciding to do special designs. Wahid needs to be more ethical as the way he acts within his department and other departments.

Li Jinsong- He needs to be more respectful and ethical at work. He needs to be aware of the actions he takes and the way it affects the production. Better communication with the engineering department to make sure that all components for the product are available and in case they're not these can be ordered. He needs to be disciplined for his actions.

There are different personality traits that could contribute to problems.

Henry Lefler, Sector Head of Communications and Stan both have a low score for uncertainty which is one of the reasons that policies and procedures are not being followed; Stan is breaking the rules to make sales and Henry acknowledges that he is breaking the rules but doesn't mind since it is positively impacting sales; All other managers have a high score for uncertainty which is why they place a high value on structure and procedures

Henry and Stan both have a monochromic approach to time, but Stan is the first to change things to meet his needs

Henry, Stan and Li have high control orientation and need for dominance which is why they want to influence and direct the behaviors of others; Lily, Reuben and Wahid have a low control orientation and need for dominance which could explain some of the personality conflicts and lack of action to address performance issues

There is a morale problem in sales with Stan Rummel selling units outside of his geographic area.

There is apprehension to "reel" Stan in because he is a friend of Henry LeFler - as commented by several interviews Reuben King and Li Jinsong both mentioned that customized orders is against manufacturing policy

There is a morale problem between the managers of engineering and one of the production manager

Ron Turner mentions that hard to find Malaysians with educational background needed to upper level positions; positions are typically held by Chinese or Indians

Wahid and Li have contrasting personalities in dominance and time orientation:

Li's need for dominance is high which means he wants to control his environment; he is dependent on Wahid's work and is frustrated by delays; He also feels that external factors impact his work things he can control

Wahid's need for dominance is very low which means he does not need to control his own environment which is why he accommodates special orders regardless of impacts that it has on another departments

Li's time orientation was very high which indicates that he takes a monochromic approach to work; he places a high value on meeting deadlines, following processes and completing things in a step-by-step manner

Wahid's time orientation was very low which indicates that he takes a polychromic approach to work; he places a high value on the end result not the process to get there, personal relationships and does not need to follow a specific process to complete a task

The difference in personality traits have not been used to cultivate people's strengths and to mitigate problems.

Informal organization

3. Is organizational culture, i.e., values, norms, informal roles, socialization, etc., causing the problem(s)?

Lack of congruence exists within the base station division. Lack of internal communication is apparent within the organization. The refusal or desire of Ruben King, Manufacturing manager to establish more than just an informal relationship with his Engineering and Manufacturing managers in Malaysians has allowed the personal conflict between the two managers to escalate. King states, the conflict has caused tension among employees, whom of which aligned themselves with one man or the other, which in turn has lowered morale and slowed down production.

Enerstasis has many values associated with its organization. Enerstasis believes that it should provide excellent telecommunications services throughout the world while maintaining its status as a Fortune 500 company. All employees are taught to believe this philosophy when they join the company. Enerstasis also has many basic values such as achieving high quality and providing excellent service to all customers. The company values maintaining production numbers and staying on schedule more than having flexibility to meet new customer requirements such as customized designs.

At Enerstasis in Malaysians, there are employees from different backgrounds working together such as the Americans, Malaysians, Chinese and Indians. These employees bring different values to work that affect their relationships in the workplace, among each other, and with customers.

In Malaysians, management and professional positions have been held by ethnic Chinese Malaysians; this fact has been a source of tension among the majority Malaysians and other ethnic groups.

There is tension between Li Jinsong and Wahid Karim, which is derived from the organizational culture in Malaysians.

Wahid also fills an informal role as a token manager and as a "representative" for the Malaysians at Enerstasis.

The animosity and miscommunication between Malaysian and Chinese employees in Enerstasis Malaysians has become a norm and is causing organizational conflicts leading to decreased production efficiency.

Henry Lefler, a vice president, has hired Stan Rummel as a salesman (against the norm).

Stan refuses to follow sales procedures and go through the proper channels.

Stan continues to pressure the engineering department to customize designs and to push purchasing to buy special materials to meet his clients' requests.

Employees have resigned out of frustration because of Stan's inability to adhere to company policies.

Stan's behavior has become a norm that will continue without objection due to the fact that he is a close friend of Henry Lefler, a member of upper management. Other associates feel social pressure to follow Stan and allow him to continue his behavior because of his relationship with Henry.

Informal roles in Chicago: Stan is also filling the informal role of a leading salesman who has no reservations when it comes to pushing other sales people aside to accomplish his own goals. In fearing this role, others have learned to accept this, along with his immediate supervisor Lily Crofton. This informal role has caused many problems within the sales department including the resignation of other sales associates.

Socialization has also created a problem in the sales department by Henry Lefler, who filled an informal role by hiring Stan because he was a friend, although his position was not to hire or fire any sales associates. This strategic move by Henry may have increased sales over a short period of time, but in all actuality caused numerous long term problems within the department.

4. Are the problems caused by leadership?

Henry Lefler's relationship with Stan Rummel:

This is an informal relationship that is making other individuals uncomfortable and causing them to have decreased morale.

Henry was hired during a restructuring effort to address conflicts and problems within the company, but his relationship with Stan is the cause of one of the major problems in the sales department.

Enerstasis' new leadership has failed to understand the opportunity gap of not seeking methods for customizing orders.

Leaders at Enerstasis must identify the pros and cons of customizing orders and seek methods to make this available to customers.

Reuben King's failure to address the problems between Li and Wahid;

Lack of communication between Reuben King and Suraj Patel (Wahid's manager) regarding Wahid's problems.

He fails to act on this problem, because he has no control or influence over Wahid.

Other key managers in Malaysians are not getting involved in this unproductive relationship which in turn contributes it to the fact that it may possibly be a diversity related issue where nothing can be done about it.

Ron Turner's ability as a manager is undetermined as his tenure as manager is only 4 months. He is going to require more direction and deadlines to assess his leadership skills

5. Is conflict causing the problem(s)?

Conflicts between Li and Wahid and Stan and Michelle are causing a great deal of problems for Enerstasis.

Conflicts have led to good and bad effects in Enerstasis, for example:

Interdepartmental conflicts such as those between the engineering and the manufacturing departments lead to decreased production output.

Conflicts between Stan and other sales personnel have led to the awareness that Enerstasis needs more flexibility when it comes to customization.

Li Jinsong's personal values regarding Chinese people in Malaysia are affecting his relationship with Wahid and the Malaysians. He has made statements which portray Chinese people as punctual and always interested in prospering in business and that Malaysians (such as Wahid) have no concept of time. Here is how Li's Chinese value system is causing problems at Enerstasis:

While filling the informal role as the leader of the Chinese employees in Malaysia, he tends to speak poorly of Wahid and the Malaysian workers.

He has developed a subculture among the Chinese people that has led to increasing tension against the Malaysians.

He is disrespecting employees of Malaysian descent including Wahid Karim and Amim Samon.

He is abusing legitimate power to deflect blame for production delays from himself.

The subculture Li has created is causing problems and decreasing morale among employees in Malaysians.

Wahid Karim is a Malaysian professional who is not happy with his relationship with Li Jinsong, who is Chinese. Their relationship is affected by the organizational culture of Malaysians and Chinese in Malaysians.

Wahid Karim is the token minority for the Malaysians at Enerstasis, because he is in a leadership position that is considered rare in Malaysians.

He experiences higher visibility due to the fact that he is a manager and that he has constant conflicts with Li.

He also is being pressured by Li to be average, in fact Li is upset when Wahid goes out of his way to accommodate special designs and ensure that there is quality control.

6. Are power or politics causing the problem(s)?

There is a combination of power and politics causing the problems at Enerstasis.

Henry, who was placed in a position of power, has created a situation that is causing a problem in the sales department.

Stan uses power to manipulate the production staff in order to receive his customers' orders on time, thus causing interruptions in the flow of production and contributing to the delays.

Wahid is exhibiting power by causing these delays in production due to accommodating the customized designs.

In Malaysia, politics between Chinese and Malaysians are creating tension that will take a great deal of effort and time to resolve.

7. Are the staff groupings causing the problem(s)?

According to project materials:

Multi-national organizations are most effective when they adopt a hybrid structure because that type of structure balances power across functional, product, and geographic units. Staff groupings and management style are in conflict with the organizational styles that best reflect the work that needs to be accomplished. The Malaysian assembly line workers will function best in groupings that support low variability, high repetition. According to research, a mechanistic structure approach is ideal with high analyzability. Customized orders create problems for assembly line workers and are disruptive for their line managers. This is in direct conflict with the engineering department because the optimal structure for design engineers is an organic structure with high variability and high analyzability. The company's policy is to not create customized products and for that reason there is no formal organization in place for such operations. The organization has inefficient and outdated work rules all of which have been evidenced by the company's failure to manage the production of custom base stations. Production and sales teams produce and sell standardized base stations and do not have the knowledge required to maintain the advances given in the market.

Enerstasis provides its products to network operators and commercial, government, and industrial customers; this organization has made its place in the market due to its development and implementation of high-quality telecommunications technology. However, due to not having a formal organization in place that is efficient for current customization requests by their customers the company fails to provide adequate customer satisfaction. Furthermore, certain customers are given more individualized attention while others are neglected due to the lack of ethics within the company.

There are many examples which show how the Enerstasis staff has been unable to co-operate in order to accomplish its tasks.

The employees of Wahid Karim and Li Jinsong have observed the tension between the two managers and take sides with one or the other.

Stan Rummel verse Michelle Lipinski: Stan's relationship with Henry Lefler seems to cause a strain on Michelle's relationship with Stan.

There are too few levels of hierarchy and departments and incorrect task groups. Each department focuses on its main task without understanding how interdependent they are to the organization's success. Ron Turner, the BSD head is located in Chicago. There is not a plant manager responsible at the Malaysian site, which is composed of only two departments grouped by output.

8. Are the linkages causing the problem(s)?

There is disruption in horizontal linkages, with inefficient flow of information throughout the organization along with the meager vertical linkages between middle and upper management. The manufacturing team and the engineering team continue to have a huge gap between them.

There is broken communication between engineering and manufacturing, their managers do not communicate. There is no clear communication of priorities from the management to engineering and manufacturing departments. Engineering Manager has little control over Engineering Component Manager. Thus engineering and manufacturing are not aligned.

Sales Manager doesn't have control over her subordinates; as a result Customer Service is inadequate. Division Head cannot find time to talk to Sales Manager, so the situation does not get resolved

Linkage between sales staff and engineering / manufacturing is broken and they do not have an understanding or vested interest as to what is causing the delays. They are rewarded for the sale so once they have made the sale they move on to the next one as this is what will increase their personal bottom line.

9. Are the management processes causing the problem(s)?

Enerstasis does not have an effective human resources system; staffing system for hiring, organizational socialization, training and development or promotions. The incentive system that is allowing the newer sales people namely Stan Rummel and Louise Herrington, to operate under a new client based approach. This was not communicated well with the sales team or the sales manager, and has been a de-motivator, as the new sales employees are able to work in tenured sales employees territories, meeting with established clients. This has bred resentment among the tenured sales staff employees. This may be perceived as a threat to the tenured sales staff's incentive income; which in turn leads to poor communication, poor collaboration.

Currently there are inadequate controls to prevent workers from overstepping their boundaries. Furthermore, communication between management can result in inefficiency and ultimately decreased customer satisfaction.

Enerstasis seeks to create a positive attitude among its ethnically diverse work force. Regardless, the company also does not have any programs designed to improve the educational qualifications or certifications of its employees. Furthermore, the company does not have programs focused on finding, selecting and training ethnic Malaysians to prepare them to move into management positions.

The current promotion policy allows for favoritism to come into play when recommending employees for promotion. Supervisors can refuse to sign applications in order to keep high production employees on their team, or to deny promotions to employees they do not like. Additionally they could sign for employees that may have behavioral issues just to get them off their team. Finally, superior performance in the current position may not be a qualifier for the desired position. While the standard should be at a based on, a person's aptitude, and ability, and career path should be taken into consideration as well. With this current promotion policy, there are too many gaps for advancement.

External culture

10. Are characteristics of the external culture in which the organization exists causing the problem(s)?

Cultural values are different between the Chicago office and Malaysian plant:

Malaysians are Collectivists (value harmony within their group and define themselves as part of the group to which they belong)

The Americans are Individualists (value personal freedom and find uniqueness in order to distinguish themselves from the rest of the group)

The Americans have small power distance characteristics (easy to access superiors), while the Chinese and Malaysians have large power distance attributions.

Even within the Asian employees, there are cultural differences between native Malaysian and Chinese employees:

There are cultural differences in terms of priorities, time maintenance, and attitude toward work and what constitutes a "quality" job between Wahid and Li.

According to the Business in Malaysians article:

The government generally requires companies operating in Malaysians to employ a workforce reflective of Malaysia's ethnic composition. Malaysians-based companies that are not 100 percent foreign-owned are subject to a strict ownership formula; this mandates that certain percentages of local equity must be held by Malaysians.

Malaysian Ministry of Labor mandates that a company's work force match the overall Malaysian population for each salary level. According to Enerstasis monthly labor report:

Not enough Malaysians with the needed educational background

High demand for Malaysians causing high starting salaries

Currently very few Malaysians in upper or mid management levels

Ron Turner reported, being pressured by the Malaysian government to conform to these standards.

Reuben King in his initial interview, discusses differences between employees and attributes it to cultural difference.

There is speculation to see if perception of time may also be influenced by the culture which would lend to conflict with delayed customer production.

There is documentation that personality conflicts between Wahid and Li has offended other employees' sense of respect.

Examples of external culture impacting employee performance: "Now it is true that Wahid doesn't talk to Li. But who can blame him? Li's criticism and jokes to other employees about Wahid don't make Wahid eager to confide in Li. I think Li envies Wahid for his technical talents, even though Wahid gets little credit for his activities." Another example: "Li shows up to work on time and mostly does what he's supposed to do, but he is so careless that he neglects to order parts that we need. That leads to production lines sitting idle. Li is also disrespectful. He jokes about Wahid to other people. The other day I heard him say under his breath, "Typical Malay. Relaxation is his first priority. Work is his second." He probably doesn't think I heard him, but I did. He doesn't show me any respect, either."

There is no evidence of any cultural sensitivity training given to any of the sales people or to manufacturing personnel to help them understand their multicultural differences.

Part 2: Executive Summary by Organizational Component (30 points)

Please list the root causes Organizational Architecture component. Be precise. Consider using bullets rather than paragraphs to separate root causes. Use the Lenton Case example to assist in your Enerstasis analysis.


Individuals do not have clear guidelines on how to perform their work without having a negative impact on other individuals and other departments. The lack of clear guidelines are negatively impacting sales, customer service and unit production.

The production line is not set up to handle custom orders. They have to set up entire lines to produce the parts for each one, so they only manufacture them in runs of 1,000 or more

Inefficient planning for parts ordering and assembly

Policy (no custom orders) is not enforced

Incentives in Sales Department are flawed. The incentives do not encompass customer satisfaction and contract renewals


Lily Crofton has not effectively managed the sales department

Reuben King has not effectively managed the conflict between production and engineering

Ron Turner's ineffectiveness as a leader to set direction and guidelines for the Division

Informal Organization

Late delivery: Stan pushes his orders to the front and others cannot get their orders out in time. Stan's customers are satisfied while other sales people's customers are not satisfied.

Informal organization allows for procedures and processes to be circumvented (Stan's offering custom base stations, Engineering agreeing to make these customizations and the pushing of Stan's orders to the top of the manufacturing queue).

Existing norms are not being followed in sales. There is conflict between Stan Rummel, new employee and long time friend of the VP who hired him within the Sales division. Rummel does not follow work rules, thereby, causing internal culture and socialization problems among other employees and the Sales manager. Rummel is encroaching on co-workers sales territory and taking existing clients from them. The sales manager feels powerless to reprimand Rummel due to him being hired by Henry Lefler, VP. Many employees have quit due to his insubordination.

There is tension between Li Jinsong and Wahid Karim, which is derived from the organizational culture in Malaysians.

Formal Organization

There are too few levels of hierarchy and departments and incorrect task groups. Each department focuses on its main task without understanding how interdependent they are to the organization's success.

There is discontinuity among the linkages, with poor information flow across the organization. Even though the company's policy is to not create customized products, it has failed to prevent or setup a formal structure for it. Additionally, the company has failed to comply with Malaysian government ethnicity regulations.

External Culture:

Cultural sensitivities have been neglected and have not been incorporated into business practices of hiring, promoting, and managing individuals.

Failure to develop a culturally competent workforce has impeded sales, production and places the company at risk with the Malaysian government.

There is a lack of tolerance among the various ethnic groups that make up the society in Malaysians. This is aggravated as the government is in the process of an aggressive campaign to make Malaysians the 'Multimedia Corridor'. To accomplish this it has had to bring labor in from India and China. This is caused by planned rapid expansion by government has outstripped Malaysian society's ability to provide skilled labor to keep pace with the need to meet skilled labor requirements.