Micro-Electronic Products Division (MEPD) of SMA is faced with both financial and organizational problems. The financial problems, specifically a decrease in growth, are result largely from a failure to keep pace with the market's demands for new product development. The organizational problems stem from conflict and lack of coordination between departments. The two main changes are behind these problems: The first one is a change in business environments surrounding MEPD. The other is a change in organization and management.
To analyze problems and find solutions, we has used a "Five Star" method. According to criteria of this method, MEPD didn't adapt its structure, system, people, culture, or power for its new business strategy when it changed its target market from telecommunications to commercial electronics.
Therefore, Guido Spichty, vice president and general manager of MEPD, needs to locate the gaps between MEPD's strategy, and determine the current position of the organization. He should introduce a marketing-driven management system to replace technology- and manufacturing-oriented management system in the short term, and establish a balance between them in the long term. To do this, changes in five areas are essential: First, the structure should be product- and market-oriented. Next, MEPD has to build up new systems, such as a new reward system. It needs to reform R&R (role and responsibility) and ERP systems. In addition, MEPD needs marketing and sales specialists. Furthermore, a collaborative culture and sense of team spirit within the division is a must. Finally, some power has to shift away from R&D and manufacturing to sales and marketing. .
To achieve the above strategy, Spichty should make a new team which would take responsibility for accelerating change and implementing the innovation during the next two years. In the first year, the team should help the entire company reach a consensus about how best to reorganize the company.