Cleaver’s Sausage House & the Implementation of MRP

Cleaver’s Sausage House

& the Implementation of MRP

Table of Contents

I. Introduction

Case Background

II. Issues at Hand

Technology Change, Management, Organizational Issues, Resistance to Change

III. Evaluating Courses of Action

Task Force/Incubator Approach, Coercion Approach, Organizational Development, Training Programs

IV. Conclusion

What is the Best Course of Action?

I. Introduction

Allison Elam, VP of Operations for Cleaver’s Sausage House, has had a proposal of hers shot down from the executive committee. The proposal was about launching a new MRP (materials requirement planning) software system that would help to forecast the needs of the firm going forward. The senior staff at Cleaver’s pushed back on the proposal, stating that it could turn into a very costly disaster if the MRP system was implemented. The firm fears that past horror stories, and the fragile nature of their business is too much to handle. They would rather not invest the time and money into a new system, when what they are doing now seems to work just fine.

Allison Elam is taking over the project from the CEO’s late brother, who originally purchased the MRP system but never got around to using it. Elam has past experience with MRP systems, and assured CEO Jayden Anderson that the new system would overhaul their production cycle and increase efficiency during operations. She has estimated the system could increase annual cash flow by $600,000 and save up to $200,000 annually by reducing wasted material (Daft and Marcic, 343).

Elam understands that implementing such a change would set demands across the board, but she neither communicated this well to other managers nor solicited their input to help soften the blow. Elam’s data collection was incomplete, participation in meetings was less than desired, and she turned down opportunities to be patient and work with groups to better the implementation and scope of the MRP system. Elam has the cards stacked against her. If she wishes to see the MRP system adopted at a future meeting, there is much work to be done.

II. Issues at Hand

The key issue facing Cleaver’s Sausage House is that they want to remain competitive and bring in new technologies to help their operations; however, the disruptive innovation Elam introduced was not well received. The material requirements planning (MRP) software system would radically change procurement, production, shipping and operations. The implementation would require at least twenty-five Cleaver managers and employees to change how they do their jobs. However, the launch of this system would increase annual cash flow, reduce wasted material and streamline internal processes. Senior staff, as well as other VPs and department heads were not interested in this technology and did not regard it as a priority--the Director of Logistics voiced her concern over similar technologies which had backfired at other businesses and if Cleaver’s Sausage House was currently successful, there was no need to introduce this system and cause a major change.

Thus the problem is a combination of management, technological and organizational issues. The executive committee decided the process was a no-go, the risk was too high and implementing the system could prove disastrous not only for internal teams but for customers as well. Key managers and their direct reports were also uncooperative; many even skipped meetings since this software was not introduced as a top priority for the business. Due to this lack of support, Elam was unable to get data to create a mockup of how the system would work. Having people from different departments meet to share ideas could have been useful not only for the mockup, but also in adopting successful innovation, as demonstrated in the horizontal linkage model. Members from key departments--research, manufacturing, marketing, cooperate in the development of new ideas, as in this case, the software system (Daft and Marcic, 321).

The role of technology is to help make services or processes more efficient. The technology change provided by the MRP software system would be a critical component in helping Cleaver’s Sausage House get their operations to the next level. Stefan Anderson, the late VP of Operations, played a critical role as inventor. He had originally purchased the software but didn’t know how to win support or utilize the technology so it simply sat unused. As an idea champion, Elam recognizes the need for this change and is passionately committed to making the technology work. She understands that if her company does not implement an organizational change and innovate successfully it will eventually die (Daft and Marcic, 311). This thought process was also proved in a recent study of more than six million companies, which revealed only a small number reach the age of forty (Ante).

Unfortunately, Elam is missing another critical

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