Case 4.10

Business and Marketing Name: Course: Professor Name: (October 05, 2011) Executive Summary When there are financial crises, most organizations tend to find solutions that would ensure their survival in business as well as that can ensure maximum profits and good services. Medictest laboratory is a profit-making company with strongholds in Ontario and with branches in the larger Canada. The Company is well known for good decision making and one that derives pride from its high quality employees. It receives orders from public medical institutions and other private bodies; clients from government institutions have part of their testing bills subsidized by the government though an insurance plan. Increased populations and poor economic times make lead to the government`s decision of reducing the amounts of subsidies given to Meditest and other laboratories hence the labs are expected to work within tight budgets and also make profits. As a result, Medictest directors decide to delegate powers to Jean Kelly, the manager of South-Western Ontario to come up with new structures that can ensure empowerment, good leadership, cost-effectiveness and maximum profits for Sarnia laboratory which is more like the heart of Medictests business activities. Jean comes up with a structure that has to involve downsizing of employees; the structure is accepted by the directors and human resource managers at the head office. The major challenge lays on how to relay the message to the employees on who is leaving and those that survive without causing heartache to either of the groups. This paper will examine this case study in details; try to look at problems that may exist as a result of the restructuring process, discussion of the problems using relevant theories and possible alternatives and recommendations. Problem Statement The manager of South-Western Ontario region Medictest Laboratory, Jean Kelly has been given the responsibility to come up with a revised structure that would ensure the Sarnia laboratory performs well in terms of services offered to clients, profit margins and general competitiveness in the market despite meager resources from the government. Jean is able to come up with a new structure that will involve disposal of some of the supervisors-at least five; during the process of selecting new supervisors for the new structure, some staff and supervisors happen to have a glimpse of what would soon happen in the laboratory and this knowledge increases tension among the workers. The main problem is how Jean will come up with a plan that will clearly be understood by everyone and that will work out without affecting the performance of employees; the plan will include how to break the ice to the team officially on who will be leaving and who will stay, where the meeting will be held, who will convey the message and in what format, how the head office will participate among others issues. Problems, Sub-Problems/Issues 1 Merging of departments This will mean that new staffs have to integrate with others they have not worked with before and there can be anticipated new challenges in the new work environments. On the other hand, the appointed supervisors will definitely have a double workload because the activities of two or more departments are under one umbrella; controlling the new numbers of staff may also be challenging and may call for dynamism and new management techniques which the so thought "right" supervisors may not have. 1 Staff under new leadership- The sudden change from the leadership staffs have been used to for past 20 years to new supervisors and the fact that some staff`s favorite supervisors had been laid off is in itself a problem because some staff members may deliberately make the work of the new supervisors difficult so that they appear incompetent. On the other hand some staffs may genuinely find the new leaders less appealing and may opt to quit their jobs. 2 Separation of billing from customer services and errors As much as Jean feels that separating the billing and customer service would ensure the billing manager concentrates on events occurring externally to reduce errors, this may not be the case since some details of the customer`s issues are what appear of the billing sheet and separating the two departments may results in further errors as information from two departments tries to be merged. 3 Consolidation of four regional managers (p 330) It is obvious that no matter how competent the manager taking after the four regional managers is, he/she must feel overwhelmed controlling the activities of such wide regions; the most probable consequence is that he/ she may end up overlooking some issues while trying to prioritize. 1 Further reduction of finances Whether or not the strategy Jean came up will survive greater financial changes anticipated two years after (p 329) is not clear and may be viewed as an issue of concern which may be interpreted as one that may see more departments shut off and staff laid off. 2 Expansion and auto...