Question
case inciDent 1 Kuuki: Reading the Atmosphere Most Japanese businesses have very complex vertically structured organizations. Each of the key departments of the organization has
case inciDent 1 Kuuki: Reading the Atmosphere
Most Japanese businesses have very complex vertically
structured organizations. Each of the key departments of
the organization has its own vertical structure and operates
rather like individual businesses. There is very little
inter-relationship between departments. Each department
has very clearly defined roles.
When the business interacts with customers, it is the
sales and marketing departments that handle negotiations.
Even when the customer needs technical information
and support, sales and marketing are often involved as
an intermediary between the company engineers and the
customer. It is common for sales specialists to take on the
role of negotiators on behalf of the manufacturing department
or research and development. Inter-departmental
communications are not common.
One of the problems is that salespeople rarely have technical
expertise. The majority of salespeople would not have studied
science and technology and are more likely to be qualified
in the arts. They are chosen for the sales role due to their social
skills. The perception is that engineers and technical specialists
are not as sociable and are therefore not good sellers.
In their offices, larger Japanese companies tend to have
open plan spaces. This allows the departmental head to
learn what other people does and to ensure that they share information. In smaller Japanese businesses it is common
for the business owner to also be based in an open plan
environment.
The key to success is "reading the air" or reading the
kuuki. Keeping alert to what is being said and what is
being done means that Japanese managers have instant
access to up-to-date information. It means that they
know what individual employees know. Individuals in a
department are comfortable with this situation; informal
information sharing is seen as an effective and vital
process.
Questions
15-10. Complex vertical organizational structures are very
hierarchical in nature. They are very rigid, with
each department having clearly defined roles. Is
such an organization capable of being agile and
responsive or is it a disadvantage?
15-11. What are the problems in having such strictly
defined roles?
15-12. Is reading the air just eavesdropping and spying
on others? Would most employees be comfortable
with this situation?
case inciDent 2 Boeing Dreamliner: Engineering Nightmare
or Organizational Disaster?
As a flight of imagination, Boeing's 787 Dreamliner was
an excellent idea: made of composite materials, the plane
would be lightweight enough to significantly reduce fuel
costs while maintaining a passenger load up to 290 seats.
Airline carriers chose options from a long list of unprecedented
luxuries to entice the flying public and placed
their orders well ahead of the expected completion dates.
And then the problems started.
An airplane like the 787 has a design about as complex as
that of a nuclear power plant, and Boeing's equally complex
offshore organizational structure didn't help the execution.
Boeing outsources 67 percent of its manufacturing and
many of its engineering functions. While the official assembly
site is in Everett, Washington, parts were manufactured
at 100 supplier sites in countries across the globe, and some
of those suppliers subcontracted piecework to other firms.
Because the outsourcing plan allowed vendors to develop
their own blueprints, language barriers became a problem
back in Washington as workers struggled to understand
multilingual assembly instructions. When components
didn't fit together properly, the fixes needed along the supply
chain and with engineering were almost impossible to
implement. The first aircraft left the runway on a test flight
in 2009, but Boeing had to buy one of the suppliers a year
later (cost: $1 billion) to help make the planes. The first
customer delivery was still years away.
If Boeing and industry watchers thought its troubles
were over when the first order was delivered to All Nippon
Airways (ANA) in 2011, 3 years behind schedule and after
at least seven manufacturing delays, they were wrong.
Besides the continuing woes of remaining behind schedule,
Boeing's Dreamliner suffered numerous mechanical
problems. After the plane's technologically advanced lithium-
ion batteries started a fire on one aircraft and forced
another into an emergency landing in January 2013, ANA
and Japan Airlines grounded their fleets. The FAA followed
suit, grounding all 787s in the United States. The
remaining 50 flying Dreamliners worldwide were then
confined to the tarmac until a solution could be found.
This looked like an organizational structure problem,
both at corporate headquarters and abroad. However,
there have been so many management changes during
the 787's history that it would be difficult for anyone to
identify responsibility for errors in order to make changes
in the team or the organizational structure. For the work
done abroad, restructuring reporting relationships in
favor of smaller spans of control to heighten management
accountability and tie suppliers to the organizational structure
of corporate Boeing could be considered. Or "reshoring"
to bring manufacturing physically close to the final
assembly site and under Boeing's control while centralizing
the organizational structure could be an option.
Questions
15-13. Do you think this is a case of the difficulty of
launching new technology (there are "bugs" in
any system), or one of an unsuccessful launch?
15-14. What type of executive management structure do
you think would be most conducive to getting the
Dreamliner past a component failure and back in
flight? Is this a different structure than you would
suggest for fixing the ongoing manufacturing
problems? Sketch out the potential design.
15-15. What organizational structure would you suggest
to effectively tie in Boeing's managers and suppliers
abroad? Sketch your ideas. (Goals for managers
might include facilitating teams, coordinating
efforts, maintaining organizational transparency,
and creating conversations.)
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