Strategic Management Case Study

The Wallace Group

Gabrielle Moore

One of the most important problems facing the Wallace Group would be that no one knows what they are actually doing. When they have issues they can’t resolve them and Mr. Wallace has to interne. However, that contradicts what almost everyone in the organization is upset about and that’s Mr. Wallace being so hands on and not wanting to resign, but if he did who would defuse matters between the multiple groups.

Another important problem that the organization is facing is that Electronics and Plastics are still stable and profitable, but both lack growth in markets and profits. While this is truly a problem the real problem comes from the sad net sales of the chemicals department.

There are two recommendations that I would make to Mr. Wallace would include the following

1. Cut the chemicals department so that the necessary expansion of The Wallace Group could actually take place. With this cut they would be able to develop smaller strategy, marketing and sales teams to handle everything EXCEPT actual production aspects for each group. This was they wouldn’t have to let others go in prosperous departments and would able to afford equipment needed to flourish.
2. Need to have a database or system put into place that every entity has access to that can generate various reports for each group at any given time.

To educate a Stage I manager to become a Stage II or III professional manager I believe adequate training is necessary. Management training, and continuous education modules need to be set in place that are a mandatory requirement for all those of management level positions. The lack of training at The Wallace Group has a significant impact on this case because one, they don’t have management teams that are capable of ensuring that departments that make up the entire organization are ran properly and generate success. Because of this product isn’t able to be purchased, people are being hired to help the process of increased profits and departments lack the knowledge of know how to solve common business problems.

Having to buy plastics and chemicals from sister Wallace Groups is too expensive, which means company is losing out on money and profits that the company really needs to turn organization around for the best. Cutting the chemicals department so that expansion can take place and the Wallace Group can actually develop smaller strategy, marketing and even sales teams to handle everything except the product aspect of each group would be the way to handle the transfer pricing problems involved in the backward integration.

If Mr. Wallace is found to be one of the major problems, he should be addressed directly by someone of the management level within the organization. I say this because they would’ve been in the company long enough to have solid facts, reports, and even reasoning why he is one of the major problems and actually have a well thought out plan as to why he should resign for the betterment of The Wallace Group.

The Wallace Group’s diversification strategy hasn’t been effective because they haven’t been able to diversify via proper hiring channels within the company. The have an issue right now where they aren’t able to bring well qualified persons in because they don’t have the funding to do so. With that being said many qualified people are left being denied and turned down for opportunities that they would otherwise be hired for in the company.  I will say that they need to get this incorporated soon before someone else sues them and while the appropriate department is taking matters lightly, this could very well be one of the reasons for The Wallace Group’s demise.