Stone Finch Business Case - Organizational Development Essay

Stone Finch, Inc.: Recommendations for a More Integrated Enterprise I. Executive Summary In 2009, Stone Finch was an international company operating in 12 countries with approximately 20,000 employees who provided products and services for water- and wastewater-related industries. The company consisted of two main divisions, one known as â€Å"Water Products† carried out the traditional business services that had sustained the company since its founding in 1975 by the Stone family. The other division, known as â€Å"Solutions†, was formed through the acquisition of Goldfinch Technologies in 2000, a 75-person biochemical services company, focused on offering biochemical services and developing new technologies, which was headed by Jim Billings. In†¦show more content†¦II. Analysis: Current State of Stone Finch and Origins of Issues The conflict between Water Products Division management and the CEO appears to be a result of differences in strategic and financial priorities; however, beneath the surface of this conflict, other issues are at play. Underlying issues include strategic alignment of the organization’s divisions, financial management, organization structure, rewards, decision-making, power and culture. Financial Management Since the merger of Stone and Goldfinch, and the investments in Entrepreneurial Subsidiaries, the growth in revenues and contribution margin of Solutions Division has outpaced Water Products. Solutions now produces 61% of total profits for Stone Finch, as shown in Figure 1, yet Water Products continues to invest capital into Solutions and Subsidiaries investments. Figure 1. Growth in Contribution Margins of Water Products and Solutions Divisions, 1999-2008. (Also see Appendix A: Financial Data.) Organizational Structure and Alignment The two divisions of Stone Finch have different organizational structures stemming from different work processes and strategies. The Water Products Division is a hierarchal, mechanistic structure typical of manufacturing operations (Morgan, pp. 31-33); employees have clearly defined roles and an established rewards system. By contrast, the Solutions Division isShow MoreRelatedThe Success Of Stone Finch, Inc.1775 Words   |  8 Pagesletting them figure out how to act upon it. In the Harvard Business School Brief Case â€Å"Stone Finch, Inc.: Young Division, Old Division,† president and CEO Jim Billings sought to inspire people to action in order to build upon the successes of Stone Finch, Inc. Unfortunately, Billings’ ambitions to inspire were too focused on innovation and the unknown, leaving the tried and true functions of the company to dwindle away. 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