Bahria University Islamabad

Department of Management Sciences

Project Management Assignment
MBA 4F
Assignment # 1

Submitted by: Memuna Umber

Submitted to: Sir Shahid Nawaz
Enrollment Number: 01-221162-041
Dated: 24/02/2016
 Summary of the Case Study
In a nutshell, The case talks about Aaron side, a company operating in the metal machinery industry,
which was initially owned and run by a single family. From its inception to a period of 80 years the
company grew to become one of the International Market leaders; the secret of Aarons success was
centralized decision making and specialized departmental roles that allowed the company to operate
with speed and efficiency to deliver quality products.

However over time, the dynamics of the market changed, foreign competitors entered the market and
owing to their larger finances and more experience they grasped a larger market share shrinking Aaron
sides share.

Aaron Side tried various techniques including changing management, however it could not sustain itself
in the market and eventually it was acquired by Titan Corps Network of companies. In an effort to turn
the company around, Titan side created cross-functional teams consisting of permanent old members
from all departments to develop a new product (a new mining vehicle that was as fast as the world
leaders) in 8 months. However the team could not complete the project in time due to the slow decision
making process as decisions were still being made by only the Vice presidents of each departments as
opposed to all the members. To remedy this situation, Titan Corps fired all the senior vice presidents of
the company.

What are the pros and cons of the relay race approach and the cross functional
team approach to product development projects? Which approach is better?
Relay Race Approach
Under the sequential or relay race approach, a project goes through several phases in a step-by-step
fashion, moving from one phase to the next only after all the requirements of the preceding phase are
satisfied.

Pros and Cons of Relay Race Approch

These checkpoints control risk. But at the same time, this approach leaves little room for integration. A
bottleneck in one phase can slow or even halt the entire development process. (Takeuchi & Nonaka,
1986)

Cross-Functional Teams
The simplest definition of cross-functional teams (or CFTs) is groups that are made up of people from
different functional areas within a companymarketing, engineering, sales, and human resources, for
example. These teams take many forms, but they are most often set up as working groups that are
designed to make decisions at a lower level than is customary in a given company.

Pros and Cons of Cross-Functional Teams

Cross-functional teams have become more popular in recent years for three primary reasons: they
improve coordination and integration, span organizational boundaries, and reduce the production cycle
time in new product development. Bringing people together from different disciplines can improve
problem solving and lead to more thorough decision making. The teams foster a spirit of cooperation
that can make it easier to achieve customer satisfaction and corporate goals at the same time. (Cross-
Functional Teams, 2017)
However, not all cross-functional teams succeed. In fact a study in the Harvard Business Review by
Tabrizi stated that almost 75% of the cross-functional teams fail. This is because often companies much
like Aaron side lack a systematic approach, unclear governance hurts the teams, and a lack of proper
accountability hinders the progress of the team. (Tabrizi, 2015)

Which approach is better?

Although in theory Cross-functional teams are the better option because they appear to be more
flexible, in practice the external environment governs which approach is best to deal with the situation.
In a stable environment where goals may be met by efficiency in a controlled manner, the relay race
approach works better whereas in a dynamic environment where creativity is required, a well-defined
and systematic cross-functional team will serve better.

Who gets more power and who gets less power by shifting product development
projects from the relay race to the cross - functional team approach?
By shifting product development projects from Relay Race to Cross-functional team approach the line
managers and the front-line staff get more power as compared to the upper management composed of
the vice presidents and the higher level managers. This is because now the autonomy of the decisions
rests with the people whore directly working on the project.

Does the shift from the relay race to the cross - functional team approach require a
significant cultural change? Explain why or why not.
Yes, A shift to the cross-functional team approach from the traditional relay race requires a significant
culture shift. This is because the employees in a relay-race organization are accustomed to centralized
decision making. Often the people from one department are not interacting with the people from
another department as the communication between departments is being carried out by the higher
management of the department.

A gap exists between the individuals in different departments as everyone has a myopic vision of only
the functions that they are working in. In contrast, a cross-functional team requires the employees to
make the decisions themselves. It forces them to view the problem from all angels as opposed to only
their own respective function. Such a broad shift requires a significant culture change.

For a cross-functional team, employees must be open to change, ready to take risks and most
importantly they must be ready to integrate their knowledge with the knowledge in the other
departments.

Why do you think the VPs took the approach of not letting a pilot team make major
decisions although the team was empowered to do so?
I believe the VPs had been making the decisions for decades on the behalf of their teams, they did not
feel comfortable letting go of that power, perhaps they felt that their team was not ready to take up
such a responsibility. Due to years of experience in operating on the relay race, the VPs had become
risk-averse.
Was the firing of the CEO and all VPs justified? Why or why not?
I believe the firing of the CEO and all the VPs was not justified, The CEOs and VPs made a mistake by
controlling the decision, but that was because of the relay race culture that they had been working on
for years; Instead of firing them, the CEOs and the VPs should have been given the due training in
adopting the new mindset that the cross-functional teams requires.

By firing the CEO and VPS, the Titan Corps management stripped Aaron side of its core leadership
leaving the remaining pilot team confused and direction less; The members on the cross-functional
teams have operated on the relay-race for years, they have not been trained to deal with people from
other functions; They need someone to guide and develop them.

Titan Corps should have helped both the higher management and the pilot team adapt to the new
culture by training them to cope to the new culture. By firing the CEOs and VPs, they took away the
foundation Aaronside had been built on.