Reference no: EM133473290

Case Study

Universal Drugs is a family-owned pharmaceutical company that manufactures generic drugs such as aspirin and vitamin pills. The owners of the company have expressed a strong interest in making the management of the company, which traditionally has been very authoritarian, more teamwork oriented.

To design and implement the new management structure, the owners have decided to create a new position. The person in this position would report directly to the owners and have complete freedom to conduct performance reviews of all managers directly involved in the new system. Two employees from within the company have applied for the new position.

Martha Lee has been with Universal for 15 years and has been voted by her peers "most outstanding manager" on three different occasions. She is friendly, honest, and extremely conscientious about reaching short-term and long-term goals. When given the LPC scale by the personnel department, Martha received a score of 52.

Bill Washington came to Universal 5 years ago with an advanced degree in organizational development. He is the director of training, where all of his subordinates say he is the most caring manager they have ever had. While at Universal, Bill has built a reputation for being a real people person. Reflecting his reputation is his score on the LPC scale, an 89.

Questions

1. According to contingency theory, which of the two applicants should the new owner choose to head the new management structure? Why?

2. Could the owner define the new position according to contingency theory in such a way that it would qualify one of the applicants more than the other?

3. Will Universal Drugs benefit by using contingency theory in its decision-making regarding its new management structure?

Case Study adapted from Leadership Theory and Practice 6th edition, Northouse, Peter., Sage?