CASE: Sunflower in transition

You are an organizational development consultant and have received an assignment by Ms Johnson, the newly appointed CEO of Sunflower Ltd (she has been with the organization for only two months). Sunflower is the new name given to a small organization that has gone from being a governmental agency to a privately owned consulting company. It used to give advice and arrange seminars of various kinds for farmers and other stakeholders dealing in agricultural products. Due to de-regulation of such services, the company has been sold to a group of organizations who benefit from their services. It has survived with some success, as a competence centre, giving advice, arranging courses, providing access to technology and equipment, and even conducting small scale research on agricultural practices (which is used to influence politicians and the media). The business idea is to have a group of members paying fees for access to support and also earn money on courses, reports and project management. To succeed, Sunflower will have to be able to provide excellent customer service, address important policy and legal matters for the key stakeholders, and act as agents to voice the interests of the stakeholders in the media and as lobbyists in political and other important arenas. The reason why Ms Johnson has contacted you is that even though everyone welcomed the new CEO, and it was clear that the organization needed a new direction, there were severe protests against the new organizational model that she launched. Sunflower has grown organically since its founding 25 years ago. The organization started with only three people (two of whom are still with the company). Today there are 28 people in the organization. The combination of new challenges and an increase in size created a need for a more adaptive organization, but Ms Johnson was struck by the severity of the response towards her initiatives. These are the main challenges as she describes them: 1) There seems to be a basic lack of trust between different factions in the organization. The units are located on three different floors of the organization: The ground floor houses the accountancy and IT services. On the first floor, there are people acting as consultants with individual contacts to stakeholders and arrangers of courses. The third floor includes the people doing research, as well as the CEO and her secretary. The people on various levels (physical and departmental levels) are distrusting those on other levels. This distrust manifests itself in the groups, who claim that the other groups have an undue influence on decisions. They also make minor complaints, such as that the others have better coffee machines etc. This distrust makes any change or initiative difficult as these are often rejected at meetings, identified as coming from the others. 2) The organization will have to be re-designed to some extent in order to better utilize existing resources. All departments are overburdened, but there isnt enough money to hire more people and the CEO is quite certain that a more efficient distribution of types of tasks will free resources and increase capacity. While all departments have educated professionals in various fields, there are also quite a few in every department that have little or irrelevant formal education. These people were originally recruited to perform routine office work, but as the organization has grown, they have taken on tasks where they represent the organization with important assignments in a way that diffuses the difference between skilled and non-skilled labour in the organization. The different

2 positions in the organizations are almost totally based on tradition and nobody wants to change assignments and responsibilities. Already, strong resistance to the changes has been voiced, and there are rumours that some employees are considering lawsuits. 3) There seem to be several informal leaders who act as if they have the right to question all decisions. Specifically, three people stand out as powerful: a. Mr. A is 58 years old and has been with the organization for 25 years. He holds a doctoral degree in biochemistry and is one of the main knowledge assets of the organization. He is also very grumpy, and rumours have it that he drinks alcohol at work and has a sexual relationship to one of the low-skilled employees. The truthfulness of these rumours has not been established. However, the people with little education flock around him and the others speak badly about him. b. Mr B is 36 and has only been with the organization for three years, but he is a frontrunner in working with publicity and lobbying activities. He has a background as a political aide to the government. He is openly impatient to change everything and speaks loudly about the fossils who must change or be fired. c. Lastly, there is the enigmatic Mr. C, who is a financial accountant, 61 years old, and whose main task is to manage the funds and real estate that the organization controls. Nobody knows exactly what he is doing as he has been working with these tasks for more than 10 years and nobody else in the organization has competence to question his decisions or actions. He has a tendency to act as the manager of the accountancy and IT-department, to the great annoyance of Mr. D who is formally in charge of the people there. Up to now, there hasnt existed a formal top management team, but the people described here have all acted as the real decision makers. Sunflower Ltd. is in a difficult transition stage and cannot afford long phases of turmoil. Bad reputation, lawsuits and prolonged periods of poor quality deliveries may cause bankruptcy and endanger all the jobs in the company. The CEO needs some advice in understanding the situation.

Please answer the following questions

1. Using your general knowledge of organizational behaviour, outline some of the dynamics that might have caused the present situation. The purpose of this description should be to identify some (but not necessarily all) of the critical problems. Which theories and research findings in organizational behaviour could address or explain these issues? 2. Many theoretical explanations may be theoretically right, but do not necessarily leave you with practical solutions. Based on your analysis of the situation, which recommendations based on the research would you have for improving the situation? If you feel some information is missing, you are free to make assumptions about the case, as long as these are compatible with the case description and you are explicit about the assumptions you make. Please base your answers on the textbook and the articles covered in this course (see enclosed list of mandatory readings).