Tar Products: Alliedsignal (a)
17 Pages Posted: 21 Oct 2008
This case discusses the impact of corporate leadership on the financial-turnaround efforts of a division of a large corporation. At the date of the case, Charles L. Griffith, new general manager and vice president of Tar Products, is about to meet with his predecessor's leadership team for the first time. Given the history of this failing business, the tasks for the student are to decide what Griffith should say at this critical meeting and how he should deal with three urgent issues facing the division. Analysis of the case reveals a business faced with a declining industry and serious environmental and morale issues. The case provides a framework for discussing how middle management can effect change by "leading from the middle" and what factors contribute to a significant business transformation. This case should be taught with "Carbon Materials and Technologies: AlliedSignal (B)," G-0505. Videotape #8284, "AlliedSignal Tar Products," is designed for use with both cases (see Videotape Bibliography).
Rev. Mar. 22, 2012
Tar Products: AlliedSignal (A)
Tar Products was well known as the worst performing business at AlliedSignal. No one wanted to touch it. It had received little capital, and no interest or support for years from anywhere within the corporation. It was viewed as a chronic under-performer with a lot of inherent business risk. No one ever talked of a career in Tar Products, and here it was being offered to me.
With these words, Charles L. (“Chuck”) Griffith Jr. recalled the situation at the Tar Products division of AlliedSignal, Inc., in late 1994. Tar Products had been the worst-performing business at AlliedSignal year after year, with its three business units reporting annual losses of approximately $ 10 million. AlliedSignal CEO Lawrence A. Bossidy and Fred Poses, executive vice president, had asked Griffith to be the general manager of the division. So Griffith reported to his new office at 5:30 a.m. on November 1, 1994. His first day would begin at 8:30 a.m. with an introduction to his new direct reports.
Griffith sat contemplating the meeting that would soon begin. It was up to him to set the tone, expectations, and agenda for the turnaround that the division had to make. All three businesses had serious market challenges and were falling far short of financial objectives. What would it take for Griffith to be able to accomplish what Bossidy expected of the division? The division had to realign itself with the goals of the rest of the corporation and to create shareholder value.
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Keywords: change management, leadership, leading from the middle, decision making, reorganization, turnaround management, Alternative Business Issue or Setting, environmental
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Tar Products: Alliedsignal (a)
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