Janet Shugarts is the president of a barbecue sauce manufacturer in Austin, Texas. A manager in production has come up with a new barbecue recipe that he claims will be the best on the market because it's hot and spicy and has a flavor that the competition cannot match. Janet has recently received new marketing research information. The research indicates that most Europeans prefer a hot and spicy barbecue sauce.
The marketing manager is excited about this new product and believes it can be exported to Europe. Janet has just come out of a meeting with her four managers from production, marketing, finance, and human resources. They have decided to establish a sales office for the barbeque sauce in Paris, France. The plan is to create a project team to set up a production facility within a year in France. The marketing manager will head this project team. He has requested that this subsidiary be decentralized to provide him with an opportunity to make timely decisions in this local market.
Because of this expansion, Janet is planning to increase her existing workforce of 120 employees by 20 percent. She has recently hired a human resource manager to take charge of the recruiting and selection function. A rumor circulating around the plant through the "grapevine" hints that employees may attempt to bring in a union. The human resource manager is alarmed because of his position on the organization chart. His position is listed as a support position; thus, he can only advise and make recommendations to a line manager concerning issues related to recruiting and selection.
1. Has Janet created an organizational structure? If so, how?
2. Why would the marketing manager request decentralization of authority in Paris, France?
3. Does this organization reflect a line-and-staff organizational structure? If so, explain.
4. What possible disadvantage could result from the decentralization of the marketing function of the foreign sales office?