Case Study: SportsGear Inc. George Marlowe, production manager at Sports Gear, stopped at the buffet. He collected his usual breakfast which consisted of a cup of coffee and a cinnamon roll and grabbed a chair. He had been looking forward to this monthly company meeting. Martin Griffin, the new CEO of the company, would announce the new age of empowerment. A week ago George had participated in a meeting in which Martin had introduced his ideas with regard to empowerment. Griffin, a dynamic 44 year old, had been hired to give the renowned but somewhat traditional company a much needed make-over. Because SportsGear, once a leading producer and trader of sportswear had a lot of problems. Market shares were decreasing continuously under the pressure from new national and international competitors. New product ideas were rare. Departments like sales and production hardly aligned matters amongst each other at all. The overall climate was miserable. In one word SportsGear was in bad shape. In order to make SportsGear start over Martin had taken immediate action by installing an updated IT platform and initiating an optimisation of customer service. Now, while string up and down in front of his audience, he announced his new message: "In the face of intensifying competition we need new ideas, new energy and a new spirit in order to make this company as successful as it used to be. And the source of this change is you" and after a dramatic pause "every one of you." After this passionate appeal Martin became more precise. "In the course of our new empowerment concept you will receive more information about how this company is managed. You will collaborate with you colleagues in a new and creative way. And maybe most important of all, you will be in a position to make you dreams come true." "Really not bad. Very interesting indeed." Thought George. After the last years a spark of hope was exactly what SportsGear needed now. What once had been to him an interesting and inspiring job had become a treadmill. George swallowed the last bite of his roll and leaned forward to listen to the rest of Griffins speech. He looked over to Harry Lewis, a SportsGear veteran of 20 years. Harry rolled his eyes, dropped his hand down at the side of jacket pocket and made little circular movements with his index finger which he always did if he found that something was crazy. Later, in a meeting in Harrys office, he expressed it more clearly: "I think this is all some bogus again. First they tried downsizing. Than they tampered with reengineering. What are those permanent restructurings supposed to achieve? And now Grffin is talking about empowerment? If he really wants to "empower" us he can give us a pay rise!" Harry was really gaining momentum. He was autocratic, proud and always an ardent advocate of his team members. Harry was production engineer but resembled an old artisan who was ready to let any mislead boss, who didn t appreciate the essence of a work process, know about the error of his views. Even if Harry was totally loyal to the company he would be a sizable obstacle to an empowerment campaign. Georg tried to find a good counter-argument. "Why don t you give this empowerment a chance?" he asked. "You know hard I have been working last year to introduce improvements in the production department. We are still to slow with our lead times on dealer orders as well as with the development and introduction of new products. If we don t find a way to change that and quickly we may be out of work soon. Martin Griffin could for example decide to outsource our department as many other companies have been doing it already." While Harry thought about Georges argumentation he puffed on a cigar. This was a habit which he allowed himself despite all company policies. Then he said "Yes, naturally that is a danger. But empowerment will not save a single job in this company. It will only lead to a lot of meetings, to spending tons of money on consultants and to a great waste of time. Some bullshit like empowerment is no replacement for hard work and missing trust in employees, how have been with the company for years. We have made it already and we can do it again. If only they let us do our work." George new that there was no way to discuss with Harry when he was as unrelenting as now. Which ever the changes were, that Griffin had on his mind, he would need a lot of convincing with Harry. And he found it hard to imagine, how that should be done. A couple of weeks later the first meeting of the new project group was starting in a meeting room on the fifth floor. George and Harry were present, together with members of sales, product development, organisation/IT and the shop management. Susann Starr, a young consultant from Evans Associates was moderating the meeting and introduced the empowerment program. Susan lit up the beamer and started "Emowerment means something different to all of us, but to me it means the following .." She highlighted every word on the screen "Empowerment is the process of building, developing and steadily enhancing the influence of all team members by working together and using all organisational resources to intensify the cooperation." Susan started to distribute reading materials while she continued with her presentation. She raised her voice "As managers you will get a new role: coach, consultant and resource developer. You will work in a new form of cooperation. You will need to give you teams more support, information and motivation." She pointed her laser pointer at the screen and underlined the word trust. "This is the fundament for each human relation. Without trust there can not be any empowerment." Susan continued to explain that it would be the objective of the project group to develop a new system for retailers to receive their merchandise at the point of time they needed it. George was delighted, this was exactly the problem that had caused a lot of work for him in the last year without particularly visible success. Susan describe how the project group should proceed "You will test you new role in a team that is managing itself. The project group can organise itself, it can receive any information it wants to have and use any resource of the company." She added: "You have to cooperate in order to reach a consensus. You have to believe in the solutions that you propose. We a as consultant say 'you have to live'. As soon as you have a proposal you can compile a written report and present it to the vice presidents and Martin Griffin." George caught Harrys eye and in his mind he already could hear the word "nonsene" again resonating in the room. "Harry do give this thing a chance", he thought. George himself gave the project group every chance, especially because he had started to like his role as a team leader. He named the team after a character in the comics of his little son the 'power rangers'. The rangers started thei project confidently. Full of eager they strove for their target. All team members cooperated successfully in the initial phase. The group was a revelation for George. Instead of the usual entrenched conflicts between the functions people did work together now! Soon the trust among them started to increase. The team used information from marketing, production, development and financing. The visited a number of retail stores and talked to salespeople and customers. Most important were their meetings with Martin Griffin in which they learned more about the vision of empowerment. If Griffin gave a dynamic impression in front of a large audience how convincing could he be in the more personal atmosphere of his meeting room. Passionately he told how much he himself believed that SportsGear could become a highly competitive company again. He had been raised as a kid with SportsGear products and he loved them. And when he had met his future wife for the first time in a gym he had worn a SportsGear outfit and SportsGear sneakers. "You all know what a phantastic company SportsGear has been" he addressed the project group. "Empowerment can bring us back to this, because it will unit power and competence in your hands. Our environment is changing so quickly that a company doesn t have any other chance to survive than exactly that." After that Martin made it clear that George s project group was essential for tho the success of this initiative for company-wide change. The production department should be the pilot team because most other companies had been able to achieve the most progress there. "What you recommend on the basis of your work will set the scene for all other project teams." Martins speech had elated the rangers. Despite a very tight deadline they managed to finalise their report. For this they had invested a number of worked through nights and in the final stretch spent the weekends at Georges house together. All members of the team were absolutely certain that their ideas were innovative but at the same time easy to implement. A responsible product manager should accompany each product innovation from design and development until the retail store. The sales people should be entitled to make refunds of up to 500 on site. Also there would be continuous information about new products of SportGear. Sales and production staff should be exchanged regularly for short periods in order to gain insight into the respective other operation Also a hotline should be implemented in order to give developers and production managers access to the latest information from sales. The rangers had high hopes when they finalised their presentation on a Saturday evening. George was especially optimistic. The teamwork of the rangers reminded him of his high school basketball team. But Harry stayed sceptical "It ain t over till it s over" he murmured under his breath. Unfortunatly it turned out pretty soon that Harry was right. A week later George and the whole team presented their results in front of the complete round of vice presidents. Martin Griffin moderated the meeting with his usual enthusiasm. Again he highlighted his the fundamental ideas of the empowerment project and expressed his expectation that the team presentation would be very interesting. But shortly after George had started the presentation Martin left the meeting. He excused himself with the closing of an important deal with a retail chain. In Martings absence the other top managers took the word. The first was Liz Hernadez from HR who expressed her concern that any exchange between sales and production, how ever short it might be, could create confusion about the job profiles that had been developed only recently and with so much effort. Jackie Welch from finance was concerned about giving sales personnel the authority for refunds. This could provoke abuse and become a gold mine for fraudulent customers and sales people. Jim Vrabel form legal that access to the sales information would make it much easier for competitors to spy on the company. Rick Tourangeau from Strategy added, that sales people could not understand the complexity of the production processes and that a hotline would only lead to al lot of distraction every 5 minutes. At the end of the meeting the management board concluded that the project group had done important fundamental work but that further analysis and development would be required before putting anything into action. The team members were stunned by this feedback. They really had been sure of their proposal after all the hard work, the diligent analysis and the smooth presentation. But now it seemed to them that it all had been a big waste of time. George thought of what Harry had said at the beginning. And as always Harrys remark was to the point "They put obstacles in your way wherever they can" he said when they went back to the office "and in the end you are frustrated and give up." 1. Structure the case and discuss why the empowerment project at SportsGear is being stalled. 2. Which mistakes have been made and what would have been a better concept? 3. What should SportsGear do now