Paradoxical Twins Acme and Omega Electronics

Case Study on Paradoxical Twins Acme And Omega Electronics By ABC Paradoxical Twins Acme And Omega Electronics Defining the issue After reading the case of the “Paradoxical Twins Acme and Omega Electronics”, I found Both Acme and Omega produce similar products and offer similar services. Acme president John Tyler is a very tough going individual and he is portrayed to be an autocratic individual because there is one way communication in Acme. The case provides an opportunity to evaluate both Acme and Omega’s organization structure of a business.

Both companies used to have the same organizational structure but after they were sold to different investors, as a consequence of this, each company has its own procedures and company policies. Following are the same facts about both the company mentioned in the case after they became the separate business entity. Acme retained original management and promoted GM to the president. They have well defined organizational structure and decisions are often taken by top management without consulting manufacturing department.

And they have well defined job responsibilities and authority. Omega hired a new president and upgraded several existing personnel within the plant. They don’t have the organizational structure and they believe that Organizational chart seems like artificial barrier. They have a participative management style of leadership and they don’t have well defined job specification. Acme has shipped the 100 prototypes on 2 shifts, and 20% of these units were found defective. While Omega has shipped the100 units on time, and no defective items were detected.

Despite of these facts, and although, as seen in the previous section,Omega was more effective than Acme, the photocopier manufacturer decided to split the final contract between Acme and Omega, under the conditions of maintaining zero defects and lowering the final cost Justifications of this decision could be: 1-Acme retained the original structure of Technological Products of Erie, and has been able to be an Omega in profitable contracts in the past. This has formed a good reputation for Acme that might have contributed in giving them a chance to have a ortion of this contract. 2- Acmes price was slightly lower than Omega’s, and since the photocopier manufacturer have conditioned high quality, I t might have been more profitable to choose Acme as well as Omega. 3-Omega was not rejected because that would be unethical and may be illegal since they met the deadline and provided high quality inputs to photocopier manufacturer. At Acme: The high formality of coordination, and the tall hierarchy of the organizational chart, has affected the way activities were being done.

The most important effects can be summarized as follows: 1-Little information was communicated to the organization as a whole and between different departments. 2-Lack of motivation, as some manager’s voiced. 3-Some inertia against trying new methods of work existed. 4-Coordination between divisions was not high enough that some important decisions were wrongly taken. At Omega: 1-Due to the highly informal fashion work was being done in,employees had an ambiguous view of their own roles. 2-Information sharing was high among all levels, with sometimes caused a waste of time. -Innovative thinking was encouraged. 4-The work was highly collaborative Analyzing the case data The paradoxical twins describe two organizations, Acme and Omega Electronics that are competing for the same contract for manufacturing a memory unit to be used in a photocopier. Omega, having an organic structure, wins the race because they are able to produce the higher quality memory unit. On the other hand, Acme having mechanistic structure seems less competent and less reliable because of its low quality memory unit which they are unable to produce in time and some of its prototypes fail to work.

Omega even corrects a design error in the original blueprint, which improves product quality. But, both the company is given half the order, and they were encouraged to find the way to reduce the cost  and Acme takes advantage of this opportunity to experiment to find ways to reduce its costs, whereas Omega does not. Finally Acme discovers the way to reduce the cost by 20% and they won the contract. Omega may have won the battle, but Acme has won the war because its mechanistic structure fosters a concern for technical efficiency and cost reduction in what is a routine manufacturing environment.

In this particular case, Acme decides to run a “tight ship” (mechanistic structure) in order to increase productivity and efficiency, and to decrease costs. The advantage of this strategy is that they can undersell their competition (Omega) by selling at a lower cost. Omega, on the other hand, is nearly too opposite. They run a more organic structure, which relies heavily upon communication, delegation and teamwork. This strategy allows Omega to effectively compete with Acme by stressing reliability and by placing emphasis on quality.

Omega’s decentralized, organic approach allowed for the building of prototypes 10 days faster than Acme, correction of errors, and a highly reliable prototype—much more reliable than Acme’s, which had a 10 percent failure rate. Omega was more effective when evaluated by these criteria, although Acme’s prices were lower than Omega’s because of that Acme won the competition and which was a fair result in my opinion. Its mechanistic structure provided it with the management system and incentives needed to improve and reduce its manufacturing process, so that Acme won the final race over Omega.

Generating alternatives * Change in the organizational structure of both companies is needed. * Development and adaptation of new technology and techniques is required in both companies. * There should be a change in the workflow of the companies. * The merger of both companies is also an option open for both companies. Selecting decision criteria Selection criteria for the alternatives is performance and working style along with organization structure is adopted to find and recommend the alternatives. Analyzing and evaluating alternatives

Some changes can be made at both plants that would increase efficiency of work and hence enhance their competitive advantage against each other. Selecting the preferred alternative Alternative-1Change in structure Omega is a decentralized organization, where managers and subordinates delegate important decisions to lower level about new organizational projects. Omega’s management believes in mutual adjustment, which is the practice of using judgment on problem solving and also creates an informal way of communicating with each other rather than using standardization or written rules.

There is not clear cut job analysis (job description and specification). Sometime new employees don’t know what to do for a month and even longer. Omega’s organic structure gives the employees more flexibility to innovative thinking, and creates a unity within the organization but it is not enough to be the effective organization. Omega should have mix organization structure; it means it would be better if there is a mix of mechanical and organic organization structure.

There should be a formal communication channel to make sure that information is passed down or up whenever necessary. In my opinion, the company President Jim Rawls doesn’t have proper control over the employee’s functions and activities due to the lack of properly designed structure and communication network. They communicate information by direct meeting which is not good all the time especially during the rush time. Not only this, but also, the president spent too much time on listening to suggestion rather than having his own clear cut idea.

Therefore, in conclusion, to solve this kind of problem they should have transparent communication network within the organization to make sure there are no barriers in effective communication, they should define the job authority and responsibility of each task, there should be some chain of command in the organization or the top level management should decide in certain things which critical to the organization. They should change the structure to mechanistic structure and finally they should change their technology to mass production so that they also can reduce the cost of production and be more competitive in the market place.

To be effective, Omega electronics should have some kind of hierarchy where employees feel themselves in the chain of command and there should be clear authority and responsibility of each employee. They should make sure that they communication channel within the organization is effective and transparent for the efficient and prompt flow of information. Alternative- 2 Merger In the case of Acme and Omega, the high level of competitions seems to be the main motivator for both plants to strive excellence, once they merge, this motivator will vanish.

Another problem that might arise is a cross cultural conflict between members of the two plants. At Acme, every role is clearly defined, and the specialization level is high, while at Omega, roles are spread among members and specialization is not that high, conciliating such differences will be a hectic job. If those two issues were overcome, combining the well defined structure that Acme holds and the skills of its workers, with flexibility and the innovative nature of work that Omega provides,An Acme Omega merger would be a successful one and a great competitor to other plants in their industry Developing an action/implementation plan

At Acme: I would be of great benefit of cross functional teams were introduced into the structure to handle jobs such as the one in this case study. It would also be a great motivator and booster of quality of work if managers as well as specialists were given some open space to share their view collectively rather than the unidirectional channels that are adopted at Acme. This will also need a higher level of coordination between departments. Innovation should also be highly encouraged, due to the high pace of change and introduction of new products in Acme’sindustry.

At Omega: The informal nature of the structure seems to be working fine,except that it needs a bit of formalization and clarification of people’s roles. This structure was a point of strength for Omega in this bid; however, it won’t work for other tasks that need faster accomplishments of the activities. For example, instead of exchanging opinions and suggestions most of the time, this can be organized using information sharing systems that centralized data that everyone in the organization needs.