Juicy Red Tomato Company

Should I merge the acquired company into my company or operate the
acquired company as a separate business entity - the results of this
strategy will be two separate companies under one senior management
"umbrella" the senior management team that is responsible for
running both companies?

The purpose of my decision is to make the most profitable business
decision. The structure of the transaction is of critical importance
because it affects the form and liabilities of the ongoing business, the
protections available to its owners, and the taxation of each entity and
its owners.

Observation (Broad Area of research identified)

Juicy Red Tomato Company (JRT), a tomato grower operating in Florida is
interested in determining: (1) the effectiveness and efficiency of its
organizational structure, and (2) the selection and maintenance of
managerial personnel. Internal costs are rising, key personnel are
leaving, and the company is considering expanding its operations.

Preliminary Data Gathering (Interview, Literature Survey)

Completed preliminary interviews within the organization and researched
of the produce industry, and business cases with similar challenges. The
company has been in operation for 15 years, during which it has grown at
a rate of about 5% per year. Costs have remained steady for the first 10
years of the company’s existence, but have grown by 2.5 – 4% over
the past 3 years. Reasons cited by the company include unexpected
temperature drops, pests, and increased labor costs. Management has
tended to come from within the company, as long-term employees "rise
through the ranks". Over the past year, several long-term, key personnel
have left, citing that they had "no future" with JRT. However, JRT is
poised for an increased rate of growth, through possible expansion of
the business.

Problem Definition (Research problem delineated)

The organizational structure needs to be more participatory and
flexible at Juicy Tomato Company, as there seems to be a lack of
communication between production and operations. Moreover, retention is
high across all levels of staff, managerial personnel, as well as
frontline employees.

Theoretical Framework (Variable clearly identified and labeled)

In this, new environment of innovation and change, one of the primary
management challenges is to design more flexible organizational
structures. The participatory model of management must be founded on
principles and values, which, together with a statement of aims, can
form the basis of a mission statement. An organization needs a broad,
shared vision of the future, an identity, a destiny, a perspective with
regard to its goals and how they can be achieved, a management that
knows how to get everyone to pull in the same direction and a leadership
that is a driving force for change and which draws its strength from a
culture of complete trust and commitment. Organizations are replacing
their old vertical hierarchical structures with new horizontal or
matrix-based structures, linking traditional functions through
inter-functional teams, and establishing strategic alliances with
suppliers, customers, and even competitors. In fact, the organization
of the future has a structure that can be reconfigured so as to make the
best use of teams that are flexible and whose make-up varies over time,
in coordination with and as a consequence of the satisfaction of market
needs and expectations, the behavior of competitors and other market
factors, the acquisition of essential competencies and the formation of
groupings to provide access to capabilities and resources for those who
do not possess them. The management style must change from one of
control to one of instruction and guidance. There must be a move to the
concept of an organization without boundaries. An organization without
boundaries has a structure based on a model that stresses the free
circulation of individuals, information, ideas, processes, tasks, and
resources of every kind. ( HYPERLINK
"http://www.itu.int/itudoc/itu-d/hrdqpub/hrdq/hrdq86/part_ww7.doc"
http://www.itu.int/itudoc/itu-d/hrdqpub/hrdq/hrdq86/part_ww7.doc ).

To accomplish these ends, the right employee training, development and
education at the right time provides big payoffs for the employer in
increased productivity, knowledge, loyalty, and contribution (
HYPERLINK "http://humanresources.about.com/b/a/190168.htm"
http://humanresources.about.com/b/a/190168.htm ).

Generation of Hypothesis

Juicy Red Tomato Company needs to invest in retention not only of its
managerial personnel, but also front-line production employees. In
addition, JRT needs to improve communication between production and
operations, possibly by engaging in the team approach and by enhancing
technology used by the company as a whole.

References

Retrieved 16 Nov 2005 From:

( HYPERLINK
"http://www.itu.int/itudoc/itu-d/hrdqpub/hrdq/hrdq86/part_ww7.doc"
http://www.itu.int/itudoc/itu-d/hrdqpub/hrdq/hrdq86/part_ww7.doc ).

Retrieved 16 Nov 2005 From :( HYPERLINK
"http://humanresources.about.com/b/a/190168.htm"
http://humanresources.about.com/b/a/190168.htm ).

Bazerman, M. H. (2006). Judgment in Managerial Decision Making (6th
ed.). New York: Wiley.

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