Assignment:
OB Classic: The Jim Donovan Case
This classic case is by Allan R. Cohen and Michael Merenda, University of New Hampshire1
Jim Donovan, age thirty-seven, the new president and chief executive officer of Famous Products, was suddenly in the toughest spot in his life. He had just been selected by Omega Corporation, a huge conglomerate, to take over as president of its latest acquisition! And Jim had been feeling very good about himself.
Having grown up on "the wrong side of the tracks," worked his way through engineering college, earned an MBA from Harvard Business School, worked for ten years as a management consultant and two years as a successful president of a small company, Jim felt that he had arrived. The company he was going to manage was known throughout the world, had a good reputation, and would provide a good opportunity for visibility in the parent company.
The pay would be the highest he had ever earned, and while the money itself was not that important (though he'd be able to ensure financial security for his wife and four children), he enjoyed the indicator of success that a high salary provided. Jim also was eager to manage a company with over a thousand employees; the power to get things done on such a large scale was very attractive to him.
When Omega selected him, Jim had been told that Don Bird, the current president of Famous Products, was close to retirement and would be moved upstairs to chairman of the board. Bird had been president of Famous for twenty-two years and had done reasonably well, building sales steadily and guarding quality.
The top management group was highly experienced, closely knit, very loyal to the company, and its members had been in their jobs for a long time. As long-term employees, they all were reported to be good friends of Don Bird. They were almost all in their early sixties and quite proud of the record of their moderate-size but successful company.
Famous had not, however, grown in profits as rapidly as Omega expected of its operating companies, and Omega's president had told Jim that we wanted Jim to "grab a hold of Famous and make it take off."
With this challenge ringing in his ears, Jim flew out to Milwaukee for his first visit to Famous Products. He had talked briefly with Don Bird to say that he'd be arriving Thursday for half a day, then would be back for good after ten days in New York at Omega. Bird had been cordial but rather distant on the phone, and Jim wondered how Bird was taking Jim's appointment. "I've only got a few hours here," thought Jim. "I wonder how I should play it."
When Jim pulled up to Famous Products headquarters in his rented car, he noticed the neat grounds and immaculate landscaping. To his surprise, Don Bird met him at the door.
Bird had on a very conservative blue business suit, black tie, black shoes, and white shirt. He peered out at Jim through old-fashioned steel-rimmed glasses and said, "Welcome to our plant. You're just in time for our usual Thursday morning executive meeting. Would you like to sit in on that and meet our people?" Jim thought that the meeting would give him a chance to observe the management group in action, and he readily agreed, planning to sit back and watch for as long as he could.
Jim was ushered into the most formal meeting room he could remember ever having seen. The dark-paneled room was dominated by a long, heavy table, with twelve high-backed chairs around it. Seven of the chairs were filled with unsmiling executives in dark suits.
Bird led Jim to the front of the room, indicated an empty chair to the left of the seat at the head of the table, then sat down in the place that was obviously his. Turning to the group, he said:
Gentlemen, I want you to meet Mr. Donovan, but before I turn the meeting over to him, I want you to know that I do not believe he should be here; I do not believe he's qualified, and I will give him no support. Mr. Donovan.
Q: How have perceptions influenced behavior in this situation? How could those perceptions have been better managed?