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Kranworth Chair Corporation

In: Business and Management

Submitted By opalecek
Words 1100
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Kranworth Chair Corporation This study case focuses on the change of the company’s structure into a decentralized company, since before the structure of the company Kranworth Chair Corporation was more or less centralized around the two owners being the center of the company. The company’s reporting system before the change was that there were several vice-presidents reporting to a centralized ruling entity. The key recurring decisions were made strictly on a corporate level due to the fact that the company was fully centralized, so there was not even any other way. The budgeting was made on the centralized level by the VP for finance, while the managing of operations, quality, inventory and supply was managed on the centralized level by the supply chain manager, as well as all marketing and advertising was made on the corporate level. Also, information technology support, the staffing and HR matters were taken care of on the corporate centralized level. With the new system and decentralization, there was a big difference in the allocation of the decision-making power over the departmental managers. Also, the departmental managers in the new decentralized level were responsible for their own budget, staffing, supply chain management, advertising, and other activities. This new approach gave the departmental managers more power and responsibility over their products and performance of the division. Even though the advantages of the decentralization are present, there also also some disadvantages of this new approach as the possible personal limitations of the managers due to their lack of experience with managing the entire division, as well as it will need a new system of action and results controls to make sure the managers are still acting in the best interest of the company and that they are not getting out of control. One of the other possible flaws of the…...

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