The Alpha Company bought its fierce competitor, the Beta Company. In Asia this meant that former rivals were now expected to be teammates in 11 countries. Ernie, the Division Vice President, faced the dilemma of uniting these warring factions to grow the business. Ernie also was given a profit target for the division that greatly exceeded the best results the division had ever produced.
Gathering key leaders from the 11 countries, plus key members of his corporate staff, Ernie employed The RBL Group consultants using the Organizational Systems Model in special workshops to diagnose the current organizational readiness and then redesign the division to position it for success.
The diagnosis process revealed each subsidiary acted like “an island unto itself” and ran its business in isolation. There was low trust between Alpha and former Beta employees. The operating culture in both camps was focused on increasing volume, not improving profitability. Finally, new products moved much too slowly through the pipeline. Alpha had fewer new product introductions in a fiscal year than its chief competitors.
The new executive team members built trust in each other in these workshops and began to redesign some key processes and systems so that the different business units and functions could naturally collaborate on key business priorities.
One of the new structures was a system of cross-functional/geographical business teams designed to roll out new products in all countries simultaneously. Each general manager led a business team for one of Alpha’s major brands. Expectations were exchanged and agreed among the subsidiaries and between the subsidiaries and division headquarters.
In the first full fiscal year following all this organizational work, the Asia Division exceeded its “impossible” profitability goal and became the most profitable division in the entire company.