Conduct a SWOT analysis (2 points each) and recommendation (300 w o r d s) of the organization with emphasis on the organization in the below case:
PAC Resources is a small manufacturing company located in a mid-sized city in
the upper Midwest. PAC manufactures high-quality specialty components for
the computer industry. The company was founded in 1994 by current CEO,
David Dukakis. Dukakis was a talented young engineer in Silicon Valley. When
the industry hit the skids in the early 1990s, he found himself out the door with
little more than an entrepreneurial spirit and a small severance package. Dukakis
left California, moved back to his home state and used his severance package to
finance PAC Resources, starting the company in small rented quarters in a nearly
vacant strip mall. He brought in Cliff McNamara early on as chief financial officer.
Dukakis was smart enough to know that he had no head for figures, but McNamara
did. McNamara was an old college buddy, a super accounting wiz, and somebody
Dukakis could trust to squeeze as much mileage as possible out of his severance
money. It was a good match. McNamara managed the business, and Dukakis was
the idea man and designer of the specialty components, patents of which were the
backbone of PAC’s success. Today, the low-rent strip mall is a part of company
history, and PAC employs 835 full-time workers in its own contemporary facility
built in 2002.
So far, PAC has not been significantly affected by the latest downturn in the
industry. Its market niche continues to be high-quality, specialized equipment.
The company is proud that its products continue to be made in the United States
and of its ISO quality certification granted by the International Organization for
Standardization. Dukakis believes this is what has kept his company in business
while others in the industry shipped jobs offshore or went by the wayside.
PAC sells its own products and has a small customer base scattered throughout
the United States and Asia, but this generates only a small percentage of PAC’s
revenue. Eighty-three percent of PAC’s sales come from building original specialty
components for one manufacturer. This has been a steady income source for PAC,
but heavy reliance on one customer is a significant source of worry for PAC’s
management team, especially because sales of finished products are down for this
customer and cutbacks are expected. If the rumor proves true, PAC will not escape
unscathed. Consequently, the push is on for belt-tightening in the organization.
PAC instituted a hiring freeze, and marketing and sales budgets were directed
to increasing the company customer base. Canadian and European markets are
being explored, and while there is some interest, there are no solid contracts. PAC
employees are understandably jittery.
Though PAC remains non-union, three years ago the organization went through
a difficult period of employee unrest. There were complaints of poor management,
inconsistently enforced policies and unfair practices regarding job changes and
movement of employees within the organization. Because of the company’s standing
as a respected employer in the community, it was a significant public relations
black eye when an anonymous employee wrote a scathing letter to the editor of
the local paper. This brought in union organizers who distributed leaflets and
circulated authorization cards. To address employee concerns, PAC responded with
management training and reorganization of lower-level supervisory positions. A
companywide “Talk-to-the-Boss” program was implemented, allowing employees to
bring issues to any level of management without fear of reprisal. It seemed to help.
The authorization cards failed to generate enough interest for an election, and things
settled down. Unrest, though, never goes away entirely. Employees became cynical
about “Talk-to-the-Boss,” and “the union buzzards”, as Dukakis calls them, never
completely went away.
Things have certainly changed for PAC from the old days of the store-front location
and a handful of employees. Dukakis remains the CEO, but he no longer manages
the day-to-day operations, spending his time instead at his family’s summer retreat
on the Maine coast or in the Caribbean during the winter months. Decision-making
is primarily in the hands of McNamara, who is now the organization’s senior vice
president, and a second vice president, Mark Schilling. Schilling came to PAC eight
years ago with an honors degree in human resources and a successful military career.
With a history that has known only growth and strong revenue, it will be a major
culture change for PAC to respond to the eroding economy and a possible decline
in sales. In addition to the hiring freeze, McNamara directed managers to cut waste
and improve productivity across the board. Employees were reminded that every
department would be affected and that nothing was sacred.