APPEX CORPORATION

CASE ANALYSIS

MBAEx 26/14 Manu Nigam

MBAEx 29/14 Parantap Bhattacharya
MBAEx 30/14 Payal Khandelwal
MBAEx 31/14 Pranav Gupta
Question 1:
What were the challenges Shikhar Ghosh faced when he joined Appex?

Challenges:
1. Company was making losses. It was spending cash quickly, without monitoring expenses.
2. Lack of discipline among the employees. Employees did things on their own time.
3. A very informal and fluid structure where anyone was doing anything/
4. Company was adding new employees in a haphazard way.
5. Lack of standardized processes. The entrepreneurial environment was becoming chaotic.
6. Upset customers. Some customers started feeling ignored. They had to call multiple times and still their
call was getting unanswered.
7. Absence of strategy and vision. Employees were only “fire-fighting”. The org lacked a planning
structure.
8. There was no accountability.

Question 2.
Evaluate the importance of each of the structural changes Shikhar Ghosh implemented. How important were
they? What problems did each new structure address? What problems, in turn, did it create?

Solution:

Structure Degree of importance Problems addressed Problems created

- Employee didn’t relate to the structure

-Continuous flow of
Dearth of planning and - Lack of clarity on decision making
information
customer-orientation authority
- Improved coordination
Circular were not addressed; - Developed a negative perception
and integration
hence the degree of towards the customer
- Enhanced the structure
importance was low. - Long term vision and planning was
of the organization
missing
Innovative

-Employees could now

relate themselves with
The challenges around the new structure -Employees didn't respond to the new
customer-centricity and structure enthusiastically
accountability were not - It was similar to
Horizontal
addressed, hence the traditional organization - There was a lack of authority and control
degree of importance structure with clarity of because of which employees were not
was low. responsibilities and responsive
reporting
structure
 - Horizontal hierarchy led to politics
Functional differentiation
- Teams started becoming polarized
was introduced; -Brought control in the
- Functional source of authority instead of
hierarchy was setup as a organization
managerial
Stage 1: base for future structural - Led to task completion
- Individuals overpowering company
improvements, hence the - Meetings became more
policies
degree of importance productive
- Lack of clarity in cross functional
was medium
decisions
Hierarchical, Functional

Product centric teams

were created, planning
improved and functions
Stage
were integrated, but - Smooth flow of
2:Product - Resource allocation problem
customer focus was information
team
blurry, hence the degree
of importance was
medium

Senior management
representation took - Authority and resource
Stage
decisions related to allocation problem - Diminished customer focus
3:Business
resource allocation and - Standardization of - Reduction of financial accountability
team
processes; hence degree processes
of importance was high

- Improved
accountability,
A division was done on budgeting and planning - Divisions not ready to share resources
basis of businesses. An - More cooperation - Resource allocation was perceived
Operations division was within organization inequitable
Divisional
created to service both - CEO freed from - No cooperation between the divisions
of them. The degree of operational - Lack of innovative products
importance was high. responsibility and - Divisions worked in SILOs
started focusing on
strategy.

Question 3.
What would you have done in Shikhar’s place? Were all the changes in structure necessary? How would you
address the challenges Shikhar is facing towards the end of the case?

Solution:

PART A:
We wouldn’t have changed the structure so rapidly. The structure was changed too many times in a short
span of period which resulted into lack of focus on customers’ needs as everyone was concerned with
departmental issues. We would have created a hierarchy first to organize various functions.
PART B:
Circular Structure: As this did not address the hierarchy issue, this change was not necessary.

Horizontal Structure: This change didn’t resolve the hierarchical issue and the control and authority issue.
Hence, this was not a necessary structural change.

Hierarchical, Functional Structure:

Stage 1: This change was necessary since hierarchy started coming into picture with functional
differentiation.

Stage 2 - Product Team: This change was necessary as creation of product teams led to better
planning and task completion.

Stage 3 – Business Team: We see authority being established and immediate problems such as
resource allocation and standardization of processes were addressed, making it a necessary change.

Divisional Structure: This change allowed CEO to focus on strategic planning. Creation of Operations division
lead to improved accountability and higher cooperation.

PART C:
Addressing the challenges faced Post-EDS Acquisition:

The Customer Service Data Centre and Network Services unit under Ted Baker’s Operations division and
Administrative support under Finance & HR division could be disintegrated. The support teams from EDS could
be integrated to Appex’s divisional structure, thus making it leaner.