hanover
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Hanover Public Systems
Louise Liaume, Elise Manger
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Overview
• HPS (1960’s): US manufacturer of industrial electrical equipment• elevators, • lighting systems, • heating and cooling equipment,• industrial fans
• 4 plants, among them Tapei (Taiwan):• Yang Hsiao-shih former president (fired 1998)• James Fukuda new president
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Stakeholders
• Howard Wolff, President, HPS
• James Fukuda new president (Japanese-American), former vice-president of operations at the Oakland, California, plant
• C. Lo, Executive Director, Finance Division
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Documents
• Dialogue between Howard Wolff and James Fukuda Talk about the decisions Fukuda has taken maybe too fast
• Exhibit 1: Letter from Lo to Wolff Complaints from the middle-level and upper-level managers about Fukuda
• Exhibit 2: Present and Proposed Organizational Charts for HPS Taiwan
New Executive Directors positions for Purchasing and Personnel
• Exhibit 3: HPS Taiwan Balance Sheet in 1998
• Exhibit 4: HPS Taiwan Sales by Product Line, 1993-1998 Losses since 1996
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Situation
• Losses
• Measures instituted by President Fukuda : • partial liquidation, • cessation of manufacturing heating and cooling systems, • managerial reorganization : layoffs
• Conflict between Chinese (employees/managers) and Fukuda (Japanese)
• Lack of communcation between the employees and the new president of the company
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Situation : Communication
Strengths Weaknesses- Good communication with Wolff
- Lack of communication between Fukuda and employees
- Employees don’t understand Fukuda’s actions and way of thinking
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Situation: Intercultural differences
Strengths Weaknesses
- Japanese/American managerial way of Fukuda new launch to the plant
- Historically Japanese and Chinese don’t like each other
- Fukuda doesn’t take into account Chinese way of work
- Fukuda is more for an american culture than an asian one.
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Situation: Management & Ethics
Strengths Weaknesses• Can be successfull in terms
of results (like in California)• Shows that Fukuda is
involved in this project• Hard decisions for better
responses (long-term)
• Bad first image for Fukuda• Fukuda doesn’t take into
account the Chinese way of doing
• Doesn’t match with the competitor’s actions
• Depressed morale for the employees, loss of their motivation
• Layoff of 18 employees just 1 week after arriving (+ costly)
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Statement of problem
• Cultural and communication issues between Chinese and Japanese people
• Radical changes in a foreign company which shares a different culture from the board of directors have strong impacts on the company’s operating and the misunderstandings between the two cultures may damage the working relationships.
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Option 1 : Stay like that
• Don’t change anything and wait for the results
• Let Fukuda proove his workStrenghts Weaknesses
• Way to see if this management can be adopted in this subsidiary
• Not costly
• Relationships can get worse
• Not resolving the communication problem
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Option 2 : Trainings
• Organize trainings and team buildings for the employees and for Fukuda.
Fukuda : to understand the way of work of taiwanese people
Employees : be informed about the new management.Strenghts Weaknesses
• Employees and Fukuda will better understand each other
• Costly and time consuming
• Not resolving the financial problems
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Option 3 : Keep the old organization
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Option 3 : Keep the old organization
• Keep the old organization and replacing the people who have resigned
Sternghts Weaknesses
• Alternative for both Fukuda and employees
• Employees could be more confident
• Could not improve the company’s results
• Find another Vice-President and Superintendent of Manufacturing (former ones resigned) Time consuming and risky + problem of saving the face
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Option 4 : Keep the heating and cooling manufacturing
• It permits to keep the employees of this department and try to compete the competitors.
Strenghts Weaknesses
• Do not fire the manufactures of those departments
• Try to compete the competitors
• Need to find a plan to fight against competitors
• Costly• Back to the decision :
lack of credibility of Fukuda
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Option 5 : Dismiss Fukuda
• Dismiss Fukuda and upgrade C. Lo as president
Strenghts Weaknesses
• Communication/Financial problems resolved
• Employees will have a better morale and motivation
• C.Lo knows perfectly the financial situation of the company
• Loss of a good employee (Fukuda)
• Time consuming
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Recommendation
Formation programs
• Better social cohesion
• Better understanding between the employees and the President
• Meet someone halfway
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Thank you for your attention