CASE STUDY – AIRSTAR INC

BOOK QUESTIONS

QUESTION 1

Determine the goals, policies, programs, plans and strategies that will best achieve the

desired results for the company.

The aviation industry has become one of the most competitive industries of late. Besides

being one of the most competitive it is one where precision, accuracy and safety is required

most. Due to the nature of the business every component used must be the most reliable

and up to standards. Some of these measures are taken in order to safeguard the business of

the airlines as well as the lives of the passengers.According to research conducted the

industry is changing fast. Not only do the airline companies want the best quality spares for

their fleets but they also want it at a competitive price.

It is good to note that as the president of Airstar claims the company has lagged behind. The

company has failed to have a clear objective and the field of strategizing and strategic

planning has failed miserably. According to the research findings presented the company

was well known for its superior quality, customer service and safety.

As a consultant I will provide a roadmap for the company to turn itself around. Before I do

this there are some few things I will have to highlight. According to the details presented the

managerial structure is not well defined. As the president has noted there is a a huge

tendency for duplication of duties. For this reason I will design and explain some few basics

of management.

Management is a continuous problem-solving task that is performed by managers. The main

goal of management is to achieve specific organizational goals and objectives.

These goals and objectives depends on specific organizations as well as the industry in which

the organization is involved in. regardless of the organization or the industry in which the

organization is based, there are four basic functions that managers are supposed to play.

These functions are controlling, planning, motivating and organizing.

PLANNING:

Planning is the ongoing organizational process of developing and maintaining the vision and

mission of the organization. On top of this in the process of planning managers, have to

decide how the organizations goals and objectives will be achieved.

Planning is both broad and narrow in nature. In its broad perspective, it involves

accomplishing the organizations mission and in its narrow perspective, it involves the

strategies and tactics that the organization will use in order to achieve its objectives.

Managers in the field of management have to ensure that employees are grouped together

in order to achieve their organizational goals and objectives. In the process of planning

managers, have to set not only short term but also long-term goals for the organization that

junior employees have to follow.

Thus in this stage of the management p-0rocess managers have to consider themselves

depending on the following questions. Firstly, managers have to evaluate where the

organization is compared to other organizations in the same industry. Secondly, managers

have to decide and evaluate where the organization wants to be in the short run as well as in

the end. Thirdly managers in this stage of the management process have to decide and

strategize on how these objectives are going to be achieved not only in the short run but as

well as in the long run.

ORGANIZING:

Organizing is the management process that involves the establishment of the internal

organizational structure of the specific organization depending on the industry that it is

based in this sector managers are concerned with the issues of control and division of the

various tasks or assignments as well as the continuous flow of information within the specific

organization.

Within this, field managers have the added task or function of distributing authority within

the organization to various jobholders. In the field managers are also charged with the task

of translating, the processes that will be involved in achieving the organizations planned

steps.

On top of this managers at this stage are also concerned with the issue of assigning tasks to

different employees as well as setting realistic deadlines and allocating resources that will be

enough to accomplish the assigned tasks without affecting the over all organizational

budget. In addition to this, managers have to make it clear who is responsible for the

achievement of certain tasks or objectives. This makes sure that all employees are always

kept on their toes to make sure that all objectives are achieved.

MOTIVATING:

Motivating is not only a physical process but also it is also a psychological process. Managers

in any organization are supposed to set up a role model that every employee has to follow.

This is because if managers misbehave junior employees will also have the impetus to do the

same.

Within this function of motivation, managers should always have the aim of achieving proper

employee performance within the organization. With this respect, employees should not

only be motivated to assist their fellow employees but they should also be geared towards

the achievement of customer satisfaction. This motivation should initially arise from the

company managers, who are more influential within the company operations.

For excellent employee satisfaction, managers should ensure that they have excellent

reward schemes for their employees for excellent services. This will keep employees always

motivated to work hard in order to achieve extra benefits from the organizations

management. In addition to this managers should always be eager to find out specific

employee needs in order to be able to assist them further.

CONTROLLING:

Controlling is the most involving tasks of all the four management tasks. This is because it is

a four-stepped process. The controlling function involves the establishment of performance

standards. These performance standards have to be bin line with the company’s goals and or

objectives.

This stage also involves the measurement using statistical tools as well as the recording and

reporting of the actual performance level of the organization or company. After this is done

managers have also to make sure that they compare the two issues and depending on the

outcome whether positive or negative, they have to take correction measures, or if things

are not too bad they can take preventive measures to avoid the chance of the organization

going out of control.

In addition to these functions the company (Airstar) needs to have a good mission statement

as well as a guiding objective. The mission statement and the objectives need to be based on

a clear cut leadership structure. The role of top-level managers should be well separated

from the roles of middle-level managers as well as the lower level managers. In addition to

this the role of casual laborers need to be reflected as being important. In addition to this it

is necessary to note that just as many of air star’s competitors are outsourcing their factories

mainly to Latin America and Asia, the company should also consider the pros and cons of

such a move given their budget constraint.

The company should also consider formulating a precise but flexible business policy that will

allow for changes to be made without affecting the day to day running of the business. In

addition I would encourage the firms managers to embrace strategic planning and in

addition to formulate a good strategy for the firm.

Strategy implies the arrangement of deeds in the long run meant to achieve a firm’s goals

and objectives in order to be successful. It involves clearly identifying the firm’s problems

and costs to assist the management to establish the way forward putting into consideration

the resources available for utilization. At the same time, strategy involves being familiar with

every aspects included in it and attempting to apply them in real world or in business

On the other hand, strategic planning involves the company’s procedure of identifying its

intended direction or strategy and assessing the rational way of utilizing the organizations

resources to succeed in its defined strategy. It defines the organizations products, its

intended customers or market and the best way to achieve its goals and objectives or

expand its profits

The role of formative and summative evaluation should be embraced. Formative evaluation

is an evaluation technique, that is very important since it is a method that is used to assure

investors and or company directors that a certain developed software does meet the

necessary requirements on several strata’s, such as in the field of their usability and or

functionality, it sometimes also includes instructional effectiveness. Summative evaluation is

a method of judging the worth of a program at the end of the program activities. The focus is

on the outcome (Bhola 1990).

QUESTION 2

Determine the various business tasks to be done

First, the president should make sure that Morgan gains some leadership skills. Leadership

takes practice and hands-on experience. Knowing about leadership research would help

Morgan analyze situations from a variety of perspectives and learn how to be a more

effective leader. Morgan should study leadership training and develop a vision for the future

of Airstar in a changing environment. Second, Morgan should align employees to carry out

the vision for Airstar. Third, Morgan must develop personal relationships to motivate and

energize others andto unlock the personal qualities of Airstar's employees so they can work

toward the fulfillment of Airstar's vision.

QUESTION 3

Divide the business tasks into a logical and understandable organizational structure

Airstar , Inc . is one of the business organizations that have developed to a greater

magnitude but which seem that the founder had not laid down clear goals and objectives to

be followed by all the other stakeholders ,especially the employees . The organization does

not have clear strategies to be used to deal with threats and weaknesses that could arise in

the line of carrying out business duties. This means that founder had been carrying out the

duties of the organization without much encouraging team work among the other

employees . Therefore with his demise , the management is faced with a lot of chaos

including lack of clear cut duties that are laid down by the management so as to be followed

by each line manager . This brings about the fights experienced by the marketing vice

president and the controller over mergers and acquisition opportunities . This is off course

due to many overlap of duties which meant that employees are trying to outmaneuver each

other instead of working to bring about increased output and the general benefits to the

organization It is also not clear in the Airstar , Inc . organization who is supposed to report to

who . For instance , it is difficult for the president to acquire information about export

finances until the secretary made an effort to find one for him.

QUESTION 4

Determine the suitable personnel to occupy positions within the organizational stucture.

Overall Morgan and Robinson rank low in the dimensions of a good manager.

Direction:

Morgan and Robinson rank low on direction which includes planning. The organization is

under threat, and they are not sure which direction to take. They have considered potential

acquisitions, imports and exports, more research, and additional repair lines.

Alignment:

Robinson ranks far higher than Morgan on alignment which includes organizing and staffing.

Robinson believes in the ³principles of good organization´ that written whereas Morgan

assigned tasks informally.

Relationships:

Morgan ranks low on relationships which includes acting as boss. The employees write their

own job descriptions and there is a significant amount of conflict.

Personal qualities:

Robinson ranks much higher on personal qualities than Morgan because he has

management expertise and insight into the organization. He proposed that the group study

the organizational chart and the various corporate business tasks.

Outcomes:

They rank low on the management dimension of outcomes . They can maintain stability. The

organization is being increasingly chaotic, and instead of creating a culture of efficiency,

there is a duplication of work and poor communication.

Neither Robinson nor Morgan rank high in the dimensions of leadership.

Direction:

neither has created a vision and a strategy for the company.

Alignment,

Neither has created a shared culture that helps employees grow.

Relationships,

Robinson includes others more than Morgan, but neither really motivates followers.

Personal qualities:

There is no emotional connection between Robinson or Morgan and the employees of the

company.

Change:

Robinson is trying to bring about change but Morgan realizes that he is part of the problem.

Robinson (VP of Manufacturing) is the suitable personnel to occupy position within the

organizational structure. Robinson also proposed that the group study the corporate

organizational chart as well as the various corporate business tasks. After reviewing the

corporate organizational chart, Robinson, Morgan and the others agreed that the number

and kinds of formal corporate authority were logical and not much different from other

corporation. Robinson also suggests some principles of good organization.

QUESTION 5

Define the responsibility and authority of each supervisor clearly in writing

The term supervisor is generally used to refer to the managers at the lowest level in the

organization, who directly supervise non-managerial employees of the company.

As managers, the supervisors perform the same type of work as any other manager in the

company. This includes the four basic functions of planning, organizing, leading and and

control. However their work requires less of planning and organizing responsibilities as

compared to leading and control activities. Among others their responsibilities include the

following.

Physically supervise the operational work carried out by employees reporting to them.

Directly instruct employees under them on work to be carried out by them and the methods

to be adopted.

Ensure supply of material, equipment, and other inputs required by them for doing their

work.

Provide guidance and on the job training required by workmen the course of their work.

Maintain order an discipline in the workplace.

Resolve any disputes or other problems on the workplace. In case these require intervention

of managers at higher level, inform and brief them appropriately.

Act as a channel of communication between higher management and the workmen. This

involves explaining management policies and other directive to the workmen, and conveying

their feelings, and requirement to higher managements.

Recommend disciplinary action for employees breaking discipline and not responding to

warnings and advise of supervisors.

DR RAHMAN’S QUESTIONS

QUESTION 1

It is appropriate for the company to use internal or external focus?

The company should use internal focus in the organization. Morgan has an outdated view.

He is managing under the assumptions of a stable, predicable environment. Explaining that

today's environment is changing and chaotic would help him rethink his position as leader of

the organization. Morgan needs both leadership and management skills to provide direction

for Airstar. Management focuses on establishing detailed plans and schedules for achieving

specific results, then allocating resources to accomplish the plan. Leadership calls for

creating a compelling vision of the future for Airstar and developing farsighted strategies for

producing the changes needed to achieve that vision. A vision is a picture of an ambitious,

desirable future for the organization or team. To be compelling for followers, the vision has

to be one that Airstar employees can relate to and share. There are also some threats that

the company is facing . For instance , there is the threat of competition coming from General

Electric and Pratt Whitney .The other threat to the organization is the issue of backlog that is

the lowest to be experienced in the company for a long time . However , the strength that

the company has is the superior quality service which its customers have appreciated for

along time . There also the opportunity of the organization to consider acquisition , imports ,

and exports . Despite this , Airstar Inc . has also got the most disturbing weakness which is

chaos that is frustrating the top managers. Some other issues to be addressed in the

company include the executive organization . The company does not have a good

organization of its mangers and departmental heads such that there is no clear duty

framework each one of them which has led to overlapping of duties thus contributing to

chaos. There seems to be poor coordination in terms of communication that it is not clear

who is supposed to report to who in the line of duties . This can be attributed to the fact that

the organization does not have clear rules and policies to be followed by its employees.

QUESTION 2

Should the company emphasize on stability or flexibility?

The company should emphasize on stability rather than flexibility because Morgan has an

outdated view. Currently, Airstar, doesn’t have a current organizational goal that makes the

company competitive. Since the company has never been under any threats this lead to a

more chaotic work environment and frustration among employees and management

personnel. Airstar is the Analyzer. The Analyzer tries to maintain a stable business while

innovating on the periphery. It seems to lie midway between the prospector and the

defender. Some products will be targeted toward stable environments in which an efficiency

strategy designed to keep current customers is used. Others will be targeted toward new,

more dynamic environments, where growth is possible. The analyzer attempts to balance

efficient production for current product or service lines with the creative development of

new product lines.

The company also should focus low-cost leadership strategy is concerned primarily with

stability rather than taking risks or seeking new opportunities for innovation and growth. A

low-cost position means a company can achieve higher profits than competitors because of

its efficiency and lower operating costs. Low-cost leaders such as Ryanair or Wal-Mart can

undercut competitor’s prices and still earn a reasonable profit. In addition, if substitute

products or potential new competitors enter the picture, the low-cost producer is in a better

position to prevent loss of market share.

QUESTION 3

Based on Q1 and Q2, which approach should the company use?

Among the most crucial issues facing Airstar, Inc. are organizational design and strategic

direction.The market industry for Airstar, Inc., which is manufacturing and repair of small jet

engines and pistons is changing rapidly and is also facing tough competition from major

competitors such as General Electric and Pratt & Whitney (Daft, Richard. P.84). According to

our textbook organization design, is the process of administering and executing the strategic

plan. By doing this the organization or company achieves its mission and goals. This process

also addresses human resouce policies, the organization culture, the type of production

technology, and linkages to other organizations.(Daft, Richard.p.56) Currently, Airstar,

doesn’t have a current organizational goal that makes the company competitive. Since the

company has never been under any threats this lead to a more chaotic work environment

and frustration among employees and management personnel. Airstar management needs

to create/develop or revise their direction-setting process in order to succeed and move

forward. This process will give the company an end purpose and direction to remain in

business and stay competitive in their market. Mr. Morgan will need to assess the external

environment for opportunities and threats, amount of change, uncertainty, and resource

available. He will also need to assess the internal strengths and weakness in order to define

the company’s distinctive competence with other firms in the industry (Daft, Richard. p. 56).

In conclusion, the two basic elements that need to be restore concurrently in order to move

the company forward are: organizational design with an emphasis in the mission, and task

organization stressing the importance of the strategic direction. The principal leader of the

company must assemble key managers and discuss the situation, define the mission, and

delineate responsibilities.

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