Rondell Data Corporation Case Analysis

Sara Partovi

MGMT 454-01

October 20, 2015

Word Count: 740

Rondell Case Analysis

Rondell Data Corporation is a complex organization facing many challenges. The mismatch between the departments and the external environment play a key role in the problems the firm encounters. By implementing organizational design changes in the structural dimensions such as the degree of formalization, the levels of hierarchy, centralization, and teams, Rondell can work to be better suited to their environment.

Engineering is giving out new drafts to the Design department, the Design department is needing to make changes, which is leading to Production kicking back design, ultimately upsetting the Sales team that wants to satisfy their customers’ orders, and everything is a mess. One major issue seems to be with formalization. Rondell has a very loose formal structure. There are heads of each department but no strict rules or regulations on the work everyone needs to accomplish. The engineering mastermind, Doc Reeves, is the "Director of Research", yet seems to be the implied leader of the innovation that is steering the company forward and controlling the other departments. He even said "the important thing here is the relationships between people; they`re based on mutual respect, not on policies and procedures" and then continues on admitting that sure, there are problems in the departments, but basically thinks it is more important to push out ideas than deal with those issues. A stronger formal structure would be useful in guiding every person in each department on the specific definition of what each person should be accomplishing. To meet the demands of the customer in a timely manner and with a system that is effective and efficient could ease tensions with employees, keep the customers happy and minimize the risk of ruining their reputation.

        When spans of control are wide, hierarchy tends to be more horizontal and when the span of control is tall, hierarchy is vertical. With Rondell, there seems to be a more horizontal span of control. The company is decentralized, where the decision making is happening with all employees and there are no clear lines of authority. Even the Director of Engineering, Frank Forbus would say that Doc technically works for him, he is the boss, “but that’s not what’s important.” If we compare to a similar case on The Paradoxical Twins, Omega Electronics had a similar decentralized structure. When the company is large and there are so many voices and opinions, but no clear leader making the final decision, everything will slow down. Omega’s president did not believe in organizational charts and they mentioned that they “put barriers between specialists who should be working together.” This structure led to them ultimately not getting the huge contract they were competing for. To avoid this issue that Omega Electronics also faced, is to incorporate clearer lines of authority, a more vertical structure, and more centralized decision-making.  Since they face tight deadlines, pressure from the sales team, and rapid growth, a hierarchy of authority is a sensible mechanism for supervision and control.