Provide a synopsis of the Jones and Shephard case study.

JONES AND SHEPHARD ACCOUNTANTS, INC.*

By 1990, Jones and Shephard Accountants, Inc. (J&S) was a midsized company and ranked 38th in size by the American Association of Accountants. In order to compete with the larger firms, J&S formed an Information Services Division designed primarily for studies and analyses. By 1995, the Information Services Division (ISD) had fifteen employees.

In 1997, the ISD purchased three large computers. With this increased capacity, J&S expanded its services to help satisfy the needs of outside customers. By September 1998, the internal and external workloads had increased to a point where the ISD now employed over fifty people.

The director of the division was very disappointed in the way that activities were being handled. There was no single person assigned to push through a project, and outside customers did not know whom to call to get answers regarding project status. The director found that most of his time was being spent on day-to-day activities such as conflict resolution instead of strategic planning and policy formulation.

The biggest problems facing the director were the two continuous internal projects (called Project X and Project Y, for simplicity) that required month-end data collation and reporting. The director felt that these two projects were important enough to require a full-time project manager on each effort.

In October 1998, corporate management announced that the ISD director would be reassigned on February 1, 1999, and that the announcement of his replacement would not be made until the middle of January. The same week that the announcement was made, two individuals were hired from outside the company to take charge of Project X and Project Y. Exhibit 31 shows the organizational structure of the ISD.

Within the next thirty days, rumors spread throughout the organization about who would become the new director. Most people felt that the position would be filled from within the division and that the most likely candidates would be the two new project managers. In addition, the associate director was due to retire in December, thus creating two openings.

On January 3, 1999, a confidential meeting was held between the ISD director and the systems manager.

ISD Director: Corporate has approved my request to promote you to division director. Unfortunately, your job will not be an easy one. You're going to have to restructure the organi-zation somehow so that our employees will not have as many conflicts as they are now faced with. My secretary is typing up a confidential memo for you explaining my observations on the problems within our division.

Remember, your promotion should be held in the strictest confidence until the final announcement later this month. I'm telling you this now so that you can begin planning the restructuring. My memo should help you. (See Exhibit 32 for the memo.)

The systems manager read the memo and, after due consideration, decided that some form of matrix would be best. To help him structure the organization properly, an outside consultant hired to help identify the potential problems with changing over to a matrix. The following problem areas were identified by the consultant: