Andrea Cunningham

Scott Gilbride Case Study 2

Andrea Cunningham's problem lies in a common error among entrepreneurs- trying to delegate all decisions personally and not distributing any responsibility in this area to her employees.

There are many critical points relating to the overall scenario of the study, as well as relating to the problem at hand itself. Plenty of background information is provided to aid in making an informed decision about the scenario. She was located in Silicon Valley and had reputable clients such as Borland International and Hewlett-Packard. She began with 24 employees and after a year revenues grew to over 3 million dollars. Due to her management mistake of not delegating responsibility, employee moral was abysmal, managers were always fighting, and she kept losing clients and employees. Her initial remedies for this situation were flawed. A system of payment for performance was implemented, which tore the firm asunder. Competition within the business became fierce, and employees refused to share information with each other, as it could yield stolen business from one party. Cunningham liked the idea of teams, but realized something needed to be changed.

Distribution of responsibility was what she decided need to change. Andy implemented a goal-driven system using the same previous teams. Each employee was a member of at least one team which met 5 hours per week. Pay was allocated based on the objectives each team would complete, and both of these items were decided on by the employees themselves. Some of her senior employees didn't enjoy this new team-based atmosphere and voluntarily quit. It was a tragedy that they left, but the news wasn't all grim. Under the new system the company grew from 24 to 59 employees, and continued to remain profitable. In July, 2000, Cunningham Communication merged with Incepta Group PLC, where the company continues to prosper.

There are several alternative solutions to the situation, but Andrea covered most of my ideas. The incentive package where earnings were based on the dollars that employee groups brought into the company is exactly where I’d start in trying to remedy the situation. Most would be able to foresee the inter-company competition to some degree, but exactly how intense it became was an unknown. On the positive side, being in control of what wages are earned means employees would put forth the added effort to ensure they bring in a considerably sized paycheck. The negative side was