Harvard Case Study: Specialty Medical Chemicals

In 1997, SMC CEO Carl Burke had the task of accelerating company growth while maintaining mature business practices.  His predecessor was able to add mature processes, but seemingly at the expense of productivity and growth.  Burke’s job was to analyze the company and then develop and execute a plan to increase growth.  It was determined that the market would support growth in various areas and the company needed to exploit those markets.

Looking at this case from a behavioral perspective, one sees that the behavior of key individuals in the company was not going to produce the required growth.  Behaviors such as jockeying for power, isolating from other groups, hoarding information, and non-participating needed to be replaced in order for needed change.  Burke’s personality was to facilitate collaboration and he needed a management team that would participate in collaborating on strategic change.  Burke spent a few months learning about the company’s people and practices and then began to formulate ideas on how to refocus the company on growth opportunities.

Burke had a tough challenge because he had to change company culture and restructure the business to change focus on different market segments.  He hired an outside consultant to help him make these changes partly because he needed someone with whom he could exchange ideas and partly because, for political reasons, he needed another party involved when making the big changes.  The one asset Burke did have was the support of the Board of Directors and the recruiting firm that recommended him for the position.

The first part of the plan was restructuring the business based on market segments.  This part of the plan seemed good, however there did not seem to be much focus on what the new culture would be.  The company structure would essentially be overhauled at the top levels and doing so would create a great opportunity to match individuals to positions based on skills sets and personalities.  What I see missing in the plan is what personality types are desired for each position and how the company would achieve Burke’s goal of fostering collaboration at the highest levels.  Without doing so, Burke will likely effect a medium-term turn around for the company, but eventually as the market changed the company would be back to its current state.

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