The Wallace Group - Case Study

Running Head: THE WALLACE GROUP- CASE STUDY

Unit 1 IP- The Wallace Group

George DelMoral

AIU Online

MKT46 MGT485 Global Strategic Management

Matt Fok

March 25, 2006

A. What is the most important problem facing the Wallace Group?

There are numerous problems associated with the Wallace Group, but the most important seems to be inefficiency from the lack of utilizing strategic management.

a. The Wallace Group suffers from moving back and forth from an entrepreneurial mode to adaptive mode in its decision making. This can be clearly seen from the early days of Harold Wallace running all three businesses, reacting to existing problems as they arise, to the more recent events of settling unresolved disputes between Corporate and the Groups.

b. The group is functioning as a “non” learning organization. According to Wheelen & Hunger, “organizational learning is a critical component of competitiveness in a dynamic environment.” (2006, p. 9). The Wallace Group competes in a very dynamic market with respect to their electronics division where their current action is very unbeneficial.

c. The Wallace Group also lacks strategic vision and forward-thinking. There is no defined plan to move the company forward and the groups work more independently than they do as a “group” so much so that one division can actually purchase materials cheaper on the outside, but are forced to buy from internal sources at higher prices taking away from the bottom line.

B. What recommendation(s) would you make to Mr. Wallace, and in what order of priorities?

The recommendations are listed in order of priority and may be a little difficult for Mr. Wallace to accept because it involves him giving up some of his power. However, if Mr. Wallace truly wants the Wallace Group to move beyond its current status quo and grow, he going to have to seriously consider some big changes in order to realize a new reality.

a. The number one recommendation with the highest priority to Mr. Wallace is the formation of a corporate governance policy that includes a board of directors. The board will help set strategies, direction, vision, hire/fire top management, monitor and supervise top management, oversee the use of resources, and care for shareholders’ interests (Wheelen & Hunger, 2006, pp. 36-37).

b. The second recommendation would be the implementation of a formal strategic management plan that consists of SWOT analysis, strategy formulation, implantation, and evaluation and control in conjunction with progressing to a planning mode. The planning consists of systematic information gathering, strategy generation and alternatives and has been proven to be more analytical, less political, and more suited for addressing complex, changing environments such as theirs (Wheelen & Hunger,