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Aero Engines Company Restructuring Strategy

Aero Engines Company divided into three divisions in 2003 to improve performance. This initially helped but caused conflicts when the laboratory manager was replaced. The problem is how to restructure the organization to maximize use of the laboratory and increase divisional profits. Strategy A, redefining the chain of command, was chosen as it focuses on authority and priorities while considering worker opinions to increase productivity and coordination between divisions. The company will implement this through surveying workers, emphasizing work ethics, appointing appropriate roles, and maintaining employee-employer relationships. Strategy B will be used as a contingency if needed.

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Hannah Castro
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4 views2 pages

Aero Engines Company Restructuring Strategy

Aero Engines Company divided into three divisions in 2003 to improve performance. This initially helped but caused conflicts when the laboratory manager was replaced. The problem is how to restructure the organization to maximize use of the laboratory and increase divisional profits. Strategy A, redefining the chain of command, was chosen as it focuses on authority and priorities while considering worker opinions to increase productivity and coordination between divisions. The company will implement this through surveying workers, emphasizing work ethics, appointing appropriate roles, and maintaining employee-employer relationships. Strategy B will be used as a contingency if needed.

Uploaded by

Hannah Castro
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

POINT-OF-VIEW

Aero Engines Company back in 2003 resorted to an extensive reorganization leading to the division of the company
into three major divisions representing their principal product lines. The company’s president at the time, Mr. Fredricksen,
used this approach to enhance the performance of Aero Engines Company and identify unprofitable areas to give special
management to. The reorganization was doing fine not until manager of laboratory was replaced and created conflicts
between the divisions. Thus, the case will be discussed from the point of view of …

PROBLEM ANALYSIS AND STATEMENT

Problem analysis: Aero Engines Company has long been searching for effective and efficient ways to maximize their
resources for greater profitability for each division in the company. However, with the extensive reorganization of the
company which supposedly aimed to simulate the management in coping with areas of unprofitability, conflicts emerged.

Problem Statement: How would Aero Engines Company effectively and efficiently restructure the organization to
maximize the utilization of the widely-used laboratory services for increased divisional profitability?

EVALUATION OF PROS AND CONS

Weighted Factor Ratings

Garnering the highest total percentage among the indicated strategies, Strategy A, “Redefining the Chain of
Command” focuses on reforming the hierarchy and use of authority and defines the fine line between what is urgent and
what is not in terms of production. Using this, the management of the company is facing a bright future with consideration
of the workers’ opinion and sense of urgency given that the urgency was explained under satisfying conditions. In addition,
the complexity of strategy A falls under easy comprehension thus conflicts of misunderstanding and miscommunication
might be avoided. Strategy C, on the other hand, had the least value showing the least efficiency of maximizing the
utilization of the company resources considering that it paid attention to sizing up everything in the company except for
its resources which is a crucial factor for the company’s success.

DECISION

After careful analysis and evaluation of the case strategies presented, it is decided that Strategy A or redefinition of
the chain command will be used as to effectively and efficiently reform the organization for maximization of utilizing the
widely-used laboratory services to increase profitability of each division. With emphasis as to who is concerned and
involved in every decision-making on the production of the company, ease of the process for the finishing products is to
be expected. Assuming that the line of authority does not keep the right of the workers to give their opinions of what they
think is appropriate and should be done, this would create a worker-friendly atmosphere and maintain an employer-
employee relationship and assures the coordination between the employees as well. This will lead to an increase in the
productivity of individuals involved affecting the company’s productivity as a whole.

IMPLEMENTATION

To achieve the effective and efficient maximum utilization of the company resources while ensuring that profits
are gained from each division, Aero Engines Company should consider the redefinition of the company’s chain of
command. This could be carried out through the following:

1. Survey on the workers’ opinion about the company’s work ethics


a. Ways the goals are reached
b. Time it takes the goals are reached
c. Equity of the workload
2. Strong emphasis on the workers’ work ethics
a. Knowledge of the job
b. Efficiency of doing at excellence under a given amount of time
3. Appointment of individuals to appropriate roles in the company
4. Maintenance of the bond between employees and the employer

CONTINGENCY PLAN

On the event that Strategy A fails, Strategy B will be used as the contingency till eliminate the prioritization
of making military jets instead of giving attention to other division while still maintaining relative efficiency.

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