Deskco Case Study

A complex office furniture manufacturer named DeskCO spread across the United Arab Emirates, Western India and Oman has experienced significant losses in the last two years. In 2009 DeskCO invested heavily in new factories in India and Oman. At the same time they spent a significant amount of money updating their IT systems at the Customer Service center and Corporate Headquarters in Abu Dhabi.

DeskCO's manufacturing is spread across their Indian and Omani factories. Sales, Support, and Corporate headquarters are in Abu Dhabi. Some administrative support in the form of call centers and IT support is also based in India.

DeskCO's Board of Directors includes members of the ruling families of both Abu Dhabi and Oman. There are also two members of the Indian Parliament on the Board. This has meant that business decisions are sometimes influenced by the politics inside and between these countries.

Until this year the CEO of DeskCO was American. The company's problems occurred while he was the CEO. He believes that many of the problems are because of the politics and inability to reach agreement of the Board of Directors. The Board of Directors, however, believe that the decline in sales is only due to cheaper products flooding their markets from China. DeskCo's primary markets are Western India and the Middle East. All raw materials are purchased in India.

A new CEO from Jordan has been brought in. She is US educated, has lived and worked in the UAE, has some limited experience with Oman, and no experience at all in India.

It is clear the company must downsize, however, because of the politics involved, DeskCO must continue to work in all three countries. There are problems already in some of the factories with slow working and talk of striking because the employees have no feelings of job security.

Because the previous CEO was discouraged, during the last year communication between senior and middle leadership across the entire company has broken down. Middle managers are siding with front line workers and Senior managers do not have support to solve problems.

The new CEO has been told that the only rule she must follow is keeping DeskCo active in all three countries. Other than this instruction she is free to implement any change strategy she feels will save the company.