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Assignment 9 is about leadership, systems analysis and personal productivity. Review the miniature case studies in the attached document and evaluate the actions of the managers involved. Make sure you support your answers with research into the positions you take. This is the final assignment and your ability to support your work with APA style citations and references will also be scrutinized.

Answer the following questions and critique the actions of IBM, Best Buy and Unilever in resolving their problems with systems analysis.

a. Specifically, did IBM get so big that management simply didn’t see what was happening right under their noses?

b. It took IBM five years to fix their systems problem, Is that reasonable or was this a fault in leadership?

c. At Best Buy, it became clear that sales forecasts weren’t very accurate but nobody seemed to be willing to do much about it. Can we put it down to poor leadership?

d. At Best Buy, the solution of crowd casting was utilized as a way to increase forecasting accuracy. Is this really a method a of statistical analysis or that a respectable business should be involved in?

e. At Unilever, they seemed to solve health problems but they did so in a way that really increased their bottom line in the Indian marketplace. Is this really ethical?

f. If Unilever hadn’t been able to make a profit on their products, do you think they would have still offered them up to the Indian market dispite the fact that they actually did have a positive impact on the lives of the poorest Indians?

g. Thinking back to the example of the lost keys, can you see a correlation between that systems analysis and your own actions and can you apply what you learned about systems analysis to problems with your personal productivity?

Leadership, Systems Analysis and Personal Productivity
Often individuals, organizations and businesses face recurring problems without ever
realizing that what they face is a systemic problem. That is a problem that comes about because
of the nature of the way operations are conducted or carried out without ever noticing that those
actions are actually the cause of the problems we face. For example, an individual comes home
at the end of the day and sets about getting dinner ready or even just relaxing. The next day, they
get ready to leave again for work, school, or other appointments and suddenly they realize they
can’t locate their car keys. This won’t be the first time they’ve lost their car keys and it doesn’t
happen all the time or even very often but then again, it won’t be the last. Why?
This is a systemic problem. There is no benefit to losing the car keys so why does it need
to happen more than once before the individual sees that the root of the problem isn’t the car
keys, it is a systems problem brought about by a haphazard method of handling an object when it
is not currently needed. A systems solution would be to have a place for the car keys to go when
the individual returns home. A nail by the doorway to hang the keys on when returning home
would solve the problem and greatly reduce the incidence of lost keys. John Foster Dulles (a
former Secretary of State) put it this way, “The measure of success is not whether you have a
tough problem to deal with, but whether it is the same problem you had last year” (as cited in
Ridgeley, 2012, p. 416). As managers, if you see the same problem more than once, you need to
recognize you’ve probably got a systems problem. The importance of this is that means instead
of focusing on the bad result, we should focus on the system instead to find the solution.
The nail where we hang our keys is an example of replacing an inappropriate system that
delivers bad outcomes with an efficient system that delivers the desired outcome. Another case
in point is a case study of IBM. IBM’s chairman, Lou Gerstner was confronted by a perplexing
problem in 1999. He guided the world’s largest information technology company, with more
than 320,000 employee and revenues of more than $91 billion but company growth was slowing.
Further, business opportunities were being missed at alarming rates and the IT world seemed to
be passing the aging giant. This seemed absurd on its face because IBM had won more patents
than any other company from 1993 to 1999, an astounding 12,773. But leveraging these patents
into new business never seemed to happen. In fact, “Gerstner discovered that internal new
business ventures that he had engineered at startup were canceled by unknown forces so as to
meet quarterly earnings goals” (Ridgeley, 2012, p. 420). Why?
IBM’s sharp focus on achieving short-term profitability had engendered strategic myopia
throughout the firm and there were not incentives to support emerging growth opportunities and
lots of incentives for avoiding them because of the risk and the need for long term development.
In short the system IBM used to reward management killed any attempt to expand into new
technologies or opportunities. IBM’s system sabotaged itself far more effectively than any
competitor could do and was so endemic that it took five years to fix.
Similarly, Jeff Severts, a vice president at Best Buy for advertising recognized that his
reputation as a manager “was linked to an internal system of monthly sales performance
measured against the firm’s financial forecasting” (Ridgeley, 2012, p. 421). Sometimes they met
forecasts and sometimes they didn’t but the forecasting seemed capricious but that didn’t save
him when he was criticized for falling short. The problem seemed to be, fell short of what, if the
forecast was inaccurate or even random to begin with. The forecast system, after analysis was
inaccurate and it seemed this was a well-known secret a Best Buy. He discovered that the
forecasting was entwined with many key management systems, each with a political agenda that
yielded forecasts wide of the mark. Realizing taking on entrenched interests was political
suicide, Severts looked for a solution and found in a relatively recent business innovation called
crowd casting.
In 2005, Severts tested this idea in his own department of Best Buy’s billion dollar giftcard business. “He called for emailed forecast estimates form 190 employees across his
business. The only incentive to participate was the chance to win a $50 gift certificate, which he
paid for personally” (Ridgeley, 2012, p. 422). The crowd’s forecast was off by half of a percent,
the official estimate was off by five percent, making this forecast 10 times more accurate. Best
Buy’s upper management was not impressed however and since the forecasting method currently
in use had a lot of political ties to many of them, that didn’t come as a shock. Now Severts was
ready to set up another test, one that purported to go up against Best Buy’s vaunted merchant
teams or a rabble versus oracle match. “More than 350 people submitted estimates of holiday
sales for Thanksgiving 2005. The final audit results showed that the official merchants’
preseason forecast was 93 percent accurate. The crowd’s forecast, on the other hand, which had
also been made four months prior to the holiday season, was 99.9 percent accurate” (Ridgeley,
2012, p. 423). Best Buy’s upper management was now ready to climb on board.
Systems analysis is particularly good at solving multiple problems that have a root cause.
In India, health care is often sporadic, expensive and often ineffectual. The Byrraju Foundation
targeted disease control in the village Sujala, “not by staffing the small dispensary with full-time
doctors or with mass deliveries of medicines and antibiotics but instead addressed the systemic
problem – impure drinking water that carried disease causing microbes” (Ridgeley, 2012, p.
422). By installing a simple and effective water purification system for the village, incidents of
disease in the village plummeted.
Unilever, the world’s number two household products company saw the same kind of
problem when it opened up its market in India. It also proved to be a shrewd business operator
according to its competitors. Unilever brought two products to India, soap and salt, and
leveraged them into the market to bring about a solution to health care problems it found.
With soap, Unilever decided to market a lower-priced soap to poor segments of society
and to do so as a health issue. To support its marketing efforts, Unilever sent teams of educators
into hundreds of rural villages to teach the local population about the spread of germs causing
disease and that washing hands with soap and water would reduce their spread. (Ridgeley, 2012,
p. 424)
With salt, Unilever marketed a special brand of salt with iodine. “Iodine is an element
required by humans for healthy thyroid gland function. But the diets of most Indians are iodine
deficient” (Ridgeley, 2012, p. 424). The company discovered that traditional Indian cooking
methods destroyed 50% of the iodine from any salt. As a result the found a more resilient type
of iodine that withstood those cooking techniques and positioned its salt as a health
enhancement.
Many managers still have difficulty identifying problems that may be systemic in nature.
One good method is a quality systems technique pioneered in Japan and employed to ferret out a
root problem. All that is required to ask yourself “why” as you continually drill down to a root
cause. Generally, going down five levels is sufficient. One example was the deterioration of the
stones used to build the Washington Monument. The first question is why are they deteriorating
and the answer was because harshness and frequency of chemicals used to clean them. The
second question then was why is the chemical use and cleaning frequency so high? The answer
would be due to the number of bird droppings. The third question would be why are there so
many birds around the monument? The answer is because of the number of insects the
congregate there. Then the fourth question would by why are the bugs gathering at the
monument. The answer would be because of the lights that shine on the monument attracts them
readily on the early evening. The fifth questions would be why we turn on the lights in the early
evening. The answer would be because that is when we do it. The solution was simply to delay
turning on the lights for half an hour which greatly decreased the number of insects, birds and
cleaning necessary.
The world uses a complex mesh of interconnected and interdependent systems that can be
exasperating but they also deliver our milk and bread, pick up our trash, and clothe us. They also
provide shelter, protect and educate us and offer tremendous advantages in a complex world.
Yet they often have unintended consequences in our personal and professional lives. We are not
at their mercy though, but managers need to be aware of how interconnected all these systems
are in an increasingly complex world.

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