The office Equipment Company Case Study

The Office Equipment Company

1. Short Presentation of the case study

In 1992, the Office Equipment Company (OEC), had to replace the manager of San Salvador, El Salvador, as chief executive at that time (a U.S. citizen) suddenly announced that he will give up his job and go within one month. El Salvador is the most densely populated country in Central America. OEC manufactures a wide variety of small office equipment (such as photocopiers, recording machines, scales for correspondence, paper shredders) in eight different countries that have been distributed and sold worldwide. OEC had no production facilities in El Salvador, but sold and served clients since the early 1970s, through independent importers, but was quickly convinced that there had to have its own staff to make sufficient sales, despite political turmoil.

OEC began building a factory in El Salvador, whose operations will begin in early 1993. This factory will import components for printers that will be assembled locally. Government should allow up to 10% of production is sold locally, with the condition that at least 90% is exported. Assembly operation will result in employment of around 150 people, El Salvador offers a rich source of cheap labor. In addition, assembly and export, OEC expect to be able to remove all trade restrictions on other office equipment imported for sale in El Salvador. The construction of this plant was supervised by a technical team from the U.S, after being assigned a director to direct an expatriate U.S. production

The option to hold the position of manager by someone from outside of the company was foreign to company policy. OEC used a combination of parent country and host country, and third country nationals in top positions in foreign countries. In fact, it was becoming increasingly clear that international experience was an important factor in deciding who should be appointed to senior management positions. Sales and service facilities in El Salvador reported by a Latin American regional office located in Coral Gables, Florida. A committee of the Regional Office quickly reduced to the choice of five candidates: Tom Zimmerman, 30 years, well trained in all aspects of sales and necessary technical or job, even though he never worked abroad for OEC; Brett Harrison, 40, who has never worked in a foreign subsidiary of the company, but worked the last three years at Regional Office of Latin America, and traveled frequently in Latin America; Carolyn Moyer, 37, unmarried, engaged in the OEC after obtaining MBA from a prestigious university 12 years before and whose performance on this item is considered excellent; Francisco Cabrera, 35,Mexican citizen, who is currently one of the deputy directors in charge of the Mexican subsidiary that produced and sold to the Mexican market; Juan Moreno,27, who was current assistant manager of El Salvador, considered competent, especially in dealing with employees, but inexperienced.

2. Identification of the problems; the causes and the negative effects

2.1 Identification of the problem(1 main, 1 secondary)

The main problem identified in the case study is the need to take a decision regarding the top management of the company.

2.2 Identification of the causes that generated the problem.

The main reason that led to the OEC problem was the decision of the general manager of San Salvador to leave the position he occupied

Secondary causes were lack of production and sales facilities in El Salvador, although they were present on the market for 22 years, the construction unit need to be supervised by a U.S. technical team and a U.S. citizen who left his home country especially to live in El Salvador will have to coordinate production. This representative will report directly to the U.S. for all aspects of production and quality control to a local directory for matters relating to accounting, finance, labor relations, cheap labor force that gave El Salvador.

OEC representatives expected that the decision of the assembly and export of equipment in El Salvador will lead to the avoidance of trade restrictions imposed for other Office components they import for sale in this state.

2.3 Identification of the potential negative effects that can appear if the problems are not solved.

If the manager is not elected requisite, to take the lead of OEC El Salvador, the company will face a range of problems, from decreased sales, both locally and internationally, and to the scenario worst case, is closing the plant in this area.

3. Identification of alternative solutions for each problem identified with adv & disadvantages.

Since the main issue relates to the choice of a manager out of 5 potential candidates the optimum solution will be selected after comparative analysis of their skills, level of education, the environment in which they live and the family.

1. Tom Zimmeran

Advantages:

-- Has 30 years in the OEC;

-- Has technical and sales experience;

-- As a member of the sales team has had some of the facilities provided by the company to people visiting foreign subsidiaries,;

-- In the company was considered quite competent as a manager;

Disadvantages:

-- Never worked abroad for OEC;

-- Expressed desire to retire in about 4 ½ years;

-- Neither wife nor his children do not speak Spanish.

2. Brett Harrison

Advantages:

-- 15 years of the CAB;

-- Was considered extremely competent and able to progress in top management in the coming years;

-- Worked 3 years in Latin America, a regional office, and traveled frequently in the region;

-- He and his wife are fluent in Spanish, and their two children, and they began to study Spanish.

Disadvantages:

-- Never not been established abroad for a longer period of time;

-- Has two children, one aged 14 and the other 15, and his wife holds a very important position in a pharmaceutical company, which can make it hard for any decision amending Brett