WAC Assignment_We Googled You_Nitish Mohan Saxena

8/10/2019 WAC Assignment_We Googled You_Nitish Mohan Saxena

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A Report on

Iggys Bread of the World

Submitted to Prof. Madhushri Shrivastava in partial

fulfillment of the requirement of the WAC course

by

Nitish Mohan Saxena

2013PGP261

Section E

IIM Indore


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Letter of Transmittal

3rd

March, 2014

Prof. Madhusri Shrivastava,

Department of Communication,

Indian Institute of Management Indore,

Indore -453331.

Subject: Submission of Report on the CaseIggys Bread of the World

Dear Maam,

As per your instructions following the preliminary discussions in the class, I am submitting a

report on Iggys Bread of the World for the partial fulfillment of the course Written Analysis

and Communication as a part of the PGDM Curriculum.

The case analyzes the dilemma faced by Ivanovic couple while deciding whether to accept

McRaes proposal of higher compensation and become peaceful with the existing work culture.

I hope you find this report satisfactory and up to the mark.

Regards,

Nitish Mohan Saxena

2013PGP261

SectionE

IIM Indore


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TABLE OF CONTENTS

Situation Analysis ................................................................................................................................................. 1

Problem Statement ............................................................................................................................................... 2

Options ...................................................................................................................................................................... 2

Criteria for Evaluation ......................................................................................................................................... 2

Evaluation of Options .......................................................................................................................................... 2

Recommendation .................................................................................................................................................. 4

Action Plan ............................................................................................................................................................... 4

Contingency Plan ................................................................................................................................................... 4


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SITUATION ANALYSIS

Igor Ivanovic and his wife Ludmilla Ivanovic started their first bakery in Pain dAvignon with two

other partners. This served as groundwork for them to shape their dreams and passion. They

sold their share of business after one year and scout a new venue for opening a bakery.

Market research indicated Boston to be a wide open market for their products, and therefore,

they set up Iggys Bread of the World. The idea behind Iggys was to provide good quality

product, maintain a healthy business for the employees to enjoy their work and to create long

lasting relationships with their customers by providing them with a unique experience.

The couple put in all their efforts towards the growth and success of this bakery . It became

very popular for the quality of its bread in a short time span and was soon supplying bread to

many of the most prestigious accounts in Boston, without any need of advertisements. Both

founders were personally involved in the bakerys operations and ensured that Iggys

employees were also involved in every aspect of the business. However, as time passed,

Ludmilla was finding it hard to strike a balance between her responsibilities towards the

business and her family. The owners were apprehensive that they would lose out on business if

they continued to turn down orders from their prestigious customers. The sudden surge in

demand compelled them to take loans to expand. Nikola, Igors younger brother started looking

after the finances of the business.

In order to cope up with increasing administrative burden they moved to Cambridge, took

strategic decisions to buy seven new delivery vans, increase kitchen by 15, and took loans forthe first time. The overwhelming situation compelled them to hire Matthew McRae as COO.

McRae took the charge and started assembling his own management team which moved the

company away from the original culture of community to a corporate culture which eventually

led to employee discontentment. In response to Igors confrontation regarding some hiring

decisions, McRae presented a vindictive letter of resignation which he later retracted claiming

that he used poor judgment and overreacted to the situation . However, McRae also claimed

that he was not being compensated enough for his time and efforts to steer Iggys towards

future success. His proposal for a raise was staggering to the Ivanovics, who now had to

decide how to proceed with Matthew McRaes role in the company.


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Problem Statement:

Igor and Ludmilla need to decide the future course of action for Iggys in light of Matthew

McRaes proposal and growing discontent among the employees.

OPTIONS

1.

Accept the proposalmade by Mathew McRae

2.

Reject his proposal, dismiss him and hire new management team

3. Reject his proposal, dismiss him and take charge himself

4.

Retain McRae and negotiate the proposal Ask McRae to revise the proposal and

arrive at a mutually accepted level of raise and bonus

5.

Reject the proposal and let Nikola lead with a support team

CRITERIA FOR EVALUATION

1. Impact on Business operations:In order to ensure that business is able to grow and

expand profitably

2. Impact on Iggys reputation:Alignment with the vision of the owners with which the

company was started which allowed them to create a positive reputation in the

market by word-of-mouth publicity.

3.

Impact on Work culture and employees: In order to maintain the work culture andfriendly environment at Iggys with involvement of employees in every aspect of

business and keeping them motivated.

EVALUATION OF OPTIONS

Accept the proposal: If the Ivanovics accept the proposal put forth by Matthew

McRae, they will have to comply with profit levels which are far lower than expected

(along with agreeing to pay a higher salary). The image of Iggys to deliver high

quality products might be hampered due to tension among the employees and the

management team. The deteriorating work culture at the bakery might encouragethe employees to look for jobs elsewhere thereby, increasing the attrition rate at

Iggys. Since it takes six months to fully train a baker and considerable effort for

training the foreign unskilled kitchen workers, Iggys cannot afford to lose its

employees. Thus, the proposal should not be accepted.

Reject the proposal, dismiss him and his team and hire new management team:

Hiring a new management team altogether will be an extremely challenging task for


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the Ivanovics, because they will have to look for a team which is equally passionate

about the business and should be able to absorb the work culture of Iggys. There

will be an uncertainty regarding new management teams ability to mix with the

employees and fuel the growth of the organization is uncertain. It would also lead to

sudden impact on the business growth of Iggys till the new team is well amalgamated

with the current team culture.

Reject the proposal, dismiss him and his team and take charge himself: This

alternative will make Igor take charge of the business back from the management team and

continue with the expansion of Iggy by himself. However, it might have a very negative impact

on the business growth provided that Igor is not experienced in business management. He is

great in baking and training the employees to bake breads. Initially also his wife was

the one who looked the operations and younger brother Nikola looked after

finances. A simple baker like Igor might not be able to retain the profitability of the

business in a long run.

Retain McRae and negotiate the proposal: The positives in the favor of McRaewhich made him an appropriate choice were his prior experience, knowledge, and

passion for the company. Though he took many decisions without consulting to Igor

but his objective was profitability. Head hunting for someone with similar level of

dedication would be difficult. Therefore, his raise and bonus could be discussed and

a consensus should be reached on the same. But again his working style will remain

incoherent with the vision of the company and will lead to negative impact on the

employee morale. Moreover, the PAT of the company has gone down significantly in

his tenure, questioning his ability to drive firm profitably.

Reject the proposal, dismiss McRae and let Nikola lead with a support team:

Nikola was involved with the firm since its initial days and was well aware of the

working culture. He played an important role in keeping the firm on the path of

growth by being the general manager and running the financial end. Moreover, he

has full understanding of the people there and knows the work-culture that should

be created in this unusual firm. He would be an appropriate fit to make a support

team and lead it to the put the company back in its position.

Options

Criteria Accept theproposal

Reject andhire new

management

team

Reject andtake charge

himself

Negotiateand retain

McRae

Reject and letNikola create

support team

Business impact May Be Maybe X

Companys reputation X Maybe X

Work Culture and

Employees

X Maybe X


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RECOMMENDATION

On the basis of above analysis, I recommend that Igor should let go McRae and entrust the

responsibility of firm to Nikola with his decision to hire professionals who could support

him throughout the process of companys growth.

ACTION PLAN

The following steps should be taken by Igor:

Reject McRae proposal of higher compensation and ask him to resign again.

Ask Nikola to take on higher responsibility while keeping the work culture intact as

it was before McRae was hired

Along with Ludmilla and Nikola, conduct interview to make a support team for

Nikola, who will assist him in sustaining the profitability and in business expansion

plans.

WAC Assignment_We Googled You_Nitish Mohan Saxena

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