Political Savy by-step explanation is called for. This provides the opportuni- ty to introduce a powerful tool called the Organization Politics Mapping Technique (OPMT), which is the subject of chapter 5.Political Savvy A Case Example were essential in making changes at a crucial point in a com- Task: Alice Johnson wants you, as a part of her dedicated pany's history. Key features have been disguised to protect the staff, to develop a strategy that will maximize acceptance innocent and the guilty. Test your political savvy by developing of the Chromium Project at Friday's meeting your own solution. Delving into a particular situation may seem onerous at first glance but hang in there. The investment will Known Information: Alice and her staff have pooled togeth- bring high returns in the form of specific techniques and er the following information related to the Chromium strategies. Project: The CEO values Owen's opinions the most, and Owen requires that the rate of return on the Chromium Project exceed 14 percent by the fourth year. He cur- rently views the near-term financial numbers on this THE CHROMIUM PROJECT: "TIPTOEING project as marginal. He has three children in college plus THROUGH THE POLITICAL MINEFIELD" two sisters to support, and his overriding personal agen- da is to succeed the CEO, who plans to retire in two The Situation: It's Monday afternoon. On Friday at 2:00 p.m., years. Owen considers Alice a possible threat to his mov- the top managers of the Milford Steel Company will meet to ing into this position. He also believes that the decide whether to invest the major portion of the capital Chromium Project, combined with other proposed pro- budget in a new product line of chromium steel. Milford's jects, represents an unacceptable drain on cash flow over CEO is undecided. The members of his top management the next two years. The CEO strongly agrees with Owen team are each examining the issue from their particular per- that Milford's cash flow must not drop more than 40% spectives. He will let their opinions determine the decision. from its previous year's level. The Key Players: Alice was hired by the CEO last year to put a stronger Craig Louton-vice president of Legal, 48 years old; emphasis on marketing. After a thorough review of the tenure: 3 years trends in the steel industry, she originated the Chromium Project because she was convinced that it is Tom Ansell-vice president of Manufacturing, 55 years absolutely essential to the long-term viability of the old; tenure: 28 years aging company. She knows that the project represents a significant departure from traditional steel manufactur Alice Johnson-vice president of Marketing, 41 years ing methods. This project will require three years to pay old; tenure: 1 year back its investment cost and then should have a 20 per- cent annual return on investment for the next decade. It Owen Farthing -vice president of Finance, 59 years old; is projected to drain Milford's cash flow by 30 percent tenure: 30 years from the previous year's level during each year of the payback period. Bill Stanton-vice president of Research and Development (R&D); 60 years old, tenure: 33 years As Vice President of Research and Development, BillChapter 4 A CASE EXAMPLE: THE FUTURE OF THE MILFORD STEEL COMPANY Management is itself a political activity. Jeffrey Pfeffer, Power in Organizations Once a politically savvy orientation has been legitimized, the next question managers typically ask is, "Now what?" The savvy attitude allows one to enter the jungle of organization pol- itics with a sense of adventure and integrity. The next step is to develop a pragmatic way of mapping out the political jungle in particular settings. Many of the strategies and techniques are difficult to dis- cuss without concrete examples to illustrate them. The case now presented is based upon an actual company. It will be used throughout the rest of the book as a reference point. The case takes place in a manufacturing setting. However, the issues are directly relevant to service and non-profit organizations. The case describes a real situation in which savvy skillsPolitical Savvy A Case Example Craig has just acquired convincing information that an this group knows more than executives who typically don't impending patent infringement case will be tossed out legitimize pooling such information prior to a key decision of court, allowing Milford to use less-risky technology meeting. Savvy approaches may not guarantee a solution, but for the Chromium Project. Recent information about they do up the odds that an influence attempt will be effective. expected tax law changes in Ohio also has Craig strong- ly believing that the drain on Milford's cash flow from Developing a Strategy the previous year's level will be only half of that which was originally projected for the new Toledo plant. He Given this daunting amount and diverse mix of data, how deeply trusts Bill Stanton's opinions related to R&D and should Alice approach Friday's meeting? After they have sift- new technology issues. Craig is considering a possible ed through the available information, the initial reactions of move to head a larger corporation's legal department. managers to this case cover the full range from "Alice should The CEO greatly values Craig's legal and tax expertise leave because she is dead in the water with Owen and Tom but ranks his opinion below that of Alice, Owen, and against her," to "Alice should confront Owen and explain that Tom on basic, overall business decisions. she is not a threat to him," to "The situation is too complex so Alice should focus on making a solid presentation of the facts Alice is clear about her personal objectives. If the on Friday and hope for the best" to "Alice has to play hardball Chromium Project is implemented, she wants to remain and use the potentially damaging information she has on Tom the vice president of Marketing for at least five years. to leverage his support." Otherwise, she will seriously consider moving on to a Those who say Alice should leave often have diagnosed more progressive company. Alice is angered by Owen's themselves on the Political Style Grid as being in the bottom left- and Tom's resistance and she knows Owen greatly dis- hand corner where the protector, cynic, and fatalist styles con- trusts her overall business judgment. Alice and Bill gregate. Managers who believe Alice should confront Owen are Stanton proposed the Tensil Strength Project, which they frequently those with high moral beliefs. The advice to focus on consider a desirable but not critical investment that a quality presentation of the facts generally comes from man- would reduce Milford's cash flow 20 percent from the agers with technical orientations who believe organizations previous year's level, annually for three years. The Tensil should be rational and logical. Those who advocate using the Strength Project could be postponed for three years with- damaging information typically believe the ends justify the out much negative impact. Alice recognizes that the new means and show strong desires to win what they see as a con- technology needed for the Chromium Project could be test. They often hover near the upper left-hand corner of the developed outside as well as inside Milford. She also Grid where the Machs hang out. knows that the CEO values her opinion, but not as much What about the upper right-hand corner of the Grid, as Tom's and Owen's. where we find the Leader, Responsible, and Advisor styles? What approach do managers viewed as having these styles rec- ...... ommend? A consistent approach emerges when those perceived as politically savvy are presented with the Milford situation. That summarizes the information put together by Alice Since the savvy approach is a little more sophisticated, a step- and her staff. All the facts aren't known, and seldom can be, but 59A Case Example Stanton believes the new technology risks involved in that the new technology required for chromium steel the Chromium Project are within acceptable limits. His production is too risky. For two years, Tom's primary major priority is rebuilding the reputation of his depart- interest has been trying to get enough of the capital bud- ment into a first-rate unit that is respected in the indus- get and cash flow to build an additional traditional steel try. He is currently looking forward to another propos- plant in Toledo. He knows that the original estimate of al, the Tensil Strength Project, as one with good possi- the cash flow drain for building the Toledo plant was bilities for his department to demonstrate its expertise projected annually at 12 percent of the previous year's Bill sees that the Chromium Project has the potential for cash flow and that the drain would last three years. major involvement of his department, but he is con- When Tom went along with the Tensil Strength Project, cerned that outside expertise might be used instead to the cash flow drain from the previous year's level was do the R&D work. The CEO values Bill's opinion but not projected at 20 percent annually, for three years. Tom as much as he values the opinions of the other execu- believes that the cash flow required for the Chromium tives. Owen believes Bill is too reckless and does not Project and the Tensil Strength Project will not allow any value his judgment. Although Alice is hard to get to near-term funds for building the more traditional man- know, Bill admires her and strongly believes she has the ufacturing plant in Toledo. best interests of the company in mind. Bill owes Alice a favor for going out on a limb to back him in a key hir- Tom believes Alice is interested only in advancing her ing decision that brought a topnotch engineer into the own career and therefore distrusts what she says to him. R&D department. Bill also knows that Alice has certain Alice knows for certain that if Tom and Owen both information which, if misrepresented to the highly strongly oppose the Chromium Project, their opinion moralistic CEO, would likely force Tom Ansell, the vice will rule the day. The CEO views Tom as probably too president of Manufacturing, into an unwanted early conservative about new technology. Alice is also aware retirement. Based upon years of experience and per- that like Owen, Tom considers Bill Stanton as an oddball. ceived lost opportunities, Bill believes Owen and Tom On the other hand, Tom has complete trust and respect are overly conservative in taking reasonable risks for the for the opinions of Craig Louton, vice president of Legal. business. All things considered, Bill, at present, can't make up his mind about the Chromium Project and may Craig believes that building a traditional steel plant just abstain at Friday's meeting. would be a safe investment for Milford Steel. He is still trying to decide which way to go on the Chromium As Vice President of Manufacturing, Tom Ansell tenta- Project, slightly leaning against it now, but could easily tively opposes the Chromium Project. The CEO values change his mind upon further considerations. He has his opinion second only to that of Owen Farthing's. Tom strongly held personal beliefs which include acting with has pretty much topped out in his career, has five years complete integrity and in the best interest of Milford's until retirement, and wants to leave a company with a long-term future. Based on Tom Ansell's opinions-and healthy future as his legacy. One of the reasons for his a bad initial meeting with Alice, Craig is not sure of her initial opposition to the Chromium Project is his view motives in proposing the Chromium Project. 57