mod2caseteam2 final

7/21/2019 Mod2caseteam2 Final

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Module 2: Organizational Purpose and Structural Design

Case Study: Dansk Design, Ltd

1971 Dansk Advertisement

MGMT 5!5"all 2#2Tea$ 2

Septe$%er 5, 2#2

Tea$ Me$%ers:

Conway, AshleyHeasty, Mark

Johnson, LauraMcDonald, AdrianSarkis, Christine


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Mod 2 Team 2Mgmt 5135

Dansk Designs Ltd was founded in 1955 by Ted Nierenberg and was a leader in high

quality rodu!ts for anything for the" to of the #dining room$ table"% &n 19'1(

Nierenberg set three business goals) 1* maintain 2+, annual growth rate in ro-ts

by entering a new market area) housewares( 2* organi.ational !hange from

entrereneurial to rofessional management( and 3* ersonal goal of withdrawing

as !hief e/e!uti0e o!er by 19'3% n analysis of Dansk is resented in this aer%

S.W.O.T. Analysis

The following 4T analysis !atures the key strengths and weaknesses within the

!omany and des!ribes the oortunities and threats fa!ing Dansk%

Strengths

Marketing6trong brand re!ognition 7 trong ad0ertising( an e/!etional sales

for!e( and a !lear and !on!ise mission statement to make anything for the

8to of the table"( ha0e made Dansk a household name synonymous with

quality and lu/ury%

rodu!t de0eloment : Dansk has a signi-!ant !ometiti0e ad0antage o0er

its !ometitors !hie;y be!ause of its< key designers% They ha0e dramati!ally

di=erent design styles( and are able to see a need and !reate a rodu!t that

will ful-ll that need and be marketable%

trong !onsumer loyalty 7 >nown as 8Dansk !lub members"( almost 5+(+++

!onsumers of Dansk wrote to the !omany in 19'+ asking questions about

the rodu!ts and gi0ing suggestions%

&ndustry leader 7 ?igh quality and ri!ed a!!ordingly with sales e/!eeding

@1+(+++(+++ and after ta/ ro-ts of @'55(+++%

Weaknesses

No manufa!turing oerations6 !onstrained by !aa!ity of !urrent suliers 7

Dansk


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No standard oerating ro!edures 7 Dansk la!ks standard oerating

ro!edures due to the tight uer management !ontrol of the !omany%

Many of the a!ti0ities and resonsibilities were not delegated down to middle

and lower management%

ging !ororate o!ers6Leadershi 7 The founder of Dansk( Ted Nierenberg(ran the !omany as a one man show in the beginning then tried to start

delegating many resonsibilities% The other leaders of the !omany found it

hard to -ll the shoes of the founder in many areas%

Opportunities

B/and market segment with new housewares rodu!t line( Dansk Courmet

Designs Ltd 7 Dansk lans to trile their !urrent rodu!t line of !ategories

with the introdu!tion of the new housewares rodu!t line% Aondu!t feasibility

studies with new rodu!ts%

Ee!ruitment of formally edu!ated management 7 see B/hibit 2 for

ba!kground !redentials of management team%

New materials and te!hnology : Bnhan!e internal e!ien!y with in0entory

management and fa!tory ordering ro!edures( ad0an!ement in

manufa!turing te!hnology

&nternational e/ansion 7 Dansk !urrently oerates internationally but with

little e!ien!y% They hoe with the hel of the new 0i!e resident of

o0erseas oerations( >eld Eosager:?ansen( they will be able to e/and the

international market and be!ome more e!ient%

Threats

New suliers for raw materials and manufa!turing to handle e/ansion 7

mo0e from small and medium si.ed known suliers to new rodu!tion

suer0ision o!e in aris to handle manufa!turing outside of !andina0ia%

Finan!ing resour!es6 ubli! o=ering of sto!k6equity resour!es 7 had been

1++, owned by Nierenberg( but e/ansion will require new debt6equity

sour!es of funding%

Ei0alry among e/isting !ometitors in new ri!ing market and !ustomer

segments 7 new rodu!t line to aeal to a new mass market( in!luding

hotels and less e/!lusi0e deartment stores requiring new ad0ertising media

to rea!h this market GTH( newsaer( amhlets*%

2


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Clobal marketla!e : Ie!ause of the industry Dansk oerates in( it !an be

drasti!ally e=e!ted by the e!onomi! !limates in the !ountries it oerates in

regarding sales( manufa!turing( and its< suliers%

Root Causal Analysis

fter 1J years as a steadily growing( sole ownershi !omany se!iali.ing in high

quality dinnerware( ;atware( and glassware( Ted Nierenberg was ready to

restru!ture the Dansk organi.ation% The !riti!al issues that need to be fa!ed are

noted below%

Problem #17 Ceograhi! searation of ?eadquarters in New Kork and Aomany in

Denmark GB/hibit 2 and te/t of !ase*

Causes

1% AB and Founder always resided in New Kork and !reated !omany after

meeting ens uistgaard in Buroe who li0ed in Denmark%

2% Manufa!turers lo!ated in Buroean !ounties 7 Denmark( Norway( weden(

Finland( Ielgium( ?olland( Fran!e and Cermany%

3% ?iring of new designers furthered the geograhi! sread 7 Cunnar Ayren

in weden( Eit0a uotila in Finland( and Niels Eefsgaard in Denmark%

% ?iring of formally trained business managers from the O%% and oerating

from Mt% >is!o( NK headquarters e/!et for H o0erseas oerations( >eld

Eosager:?ansen( who was lo!ated in Denmark%

Problem #2: Bntren!hed Leadershi

Causes1% Founders 7 Ted Nierenberg( ens uistgaard( and Bd Lubell%

2% Fi/ed areas of se!ialty 7 Nierenberg Gmarketing and manufa!turing

sour!es*( uistgaard Gdesign*( and Lubell Ggeneral administration and

-nan!ing*%

3% Eesistan!e to !hange as tasks were delegated to new hires 7 uistgaard

threatened to quit if new designers were hiredP when they were ultimately

hired( he was 8de!idedly negati0e" about them%

% 0erdeenden!e on ens uistgaard

Problem #37 &nformal business ra!ti!es

Causes

1% Aontra!ts with suliers 7 Aontra!ts e/e!uted by handshakes with small

si.ed family owned businesses

2% La!k of standard oerating ro!edures

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3% Telehone and Fa!e:to:Fa!e meetings

% No !lear dire!tion of !omany ownershi regarding Nierenberg


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organi.ation to a !hanging en0ironment% Middle managers do mu!h the same thing

for maRor deartments within the guidelines ro0ided by to management% AB

and founder Ted Nierenberg set three !lear goals towards whi!h his strategy would

be based% The !hallenges would be ha0ing middle management( uistgaard in

Denmark and Lubell in New Kork( embra!e the stru!tural !hange mo0ing Dansk from

entrereneurial to rofessional management% Nierenberg wanted to e=e!t this!hange o0er a 2 year eriod before his retirement while maintaining a 2+, annual

growth rate in ro-ts by e/anding into new rodu!t and ri!ing segments%

Two models for formulating strategies are the orter model of !ometiti0e strategies

and Miles and now


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&n order to rea!h the goal of Nierenberg

mod2caseteam2 final

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