Reference no: EM131265759

Leadership/Management Caselette

The Case of Deirio IV's "See the Promised Land"

When Modesto"Modie" Deirio IV took over as the Chief Executive Officer (CEO) of San Miguel Signals & Technology, Inc. (SMSTI) in 2007, the company was in a dire situation. It was floundering. Cash was pouring out of the company and debt was 42% of Capital.  With only 18 months in position, Deirio IV had his transformation of the company well on its way. Today, after 4 years, the price of the stock of the company, being in Computer Software Programs and Information Technology Applications, has nearly quintupled.

Deirio IV began his change management of the company by focusing on current problems and processes and paying close attention to cost control and short term results. A restructuring plan put into place saved Php325.0 Million from Capital Expenditures, put five small Information Technology Support Businesses up for sale, slashed 870 salaried and seemingly redundant jobs, merged and combined 8 data processing centers into two. This restructuring effort helped saved Php325.0 Million for SMSTI the first year after Aquino IV took over.

What made his plan successful was Deirio IV's ability to gain the commitment and enthusiasm of employees. Another aspect of Deirio IV's change management efforts was to paint a picture (literally and placed the huge finished painting where everybody can see it) of where the business (SMSTI) could be in the near future and help employees see how to reach it. He created an inspiring statement of vision and mission, and values and outlined lofty goals and objectives so all employees could "see the promised land" and know when they got there! He communicated the "vision" by regularly chatting and talking and sharing with the workers at all levels, refusing to be trapped by the old-style corporate hierarchy that separated employees from the top management. A focus on teamwork and quality works gave employees a sense of pulling together  --- for survival of the company - most, in fact, were willing to temporarily make individual sacrifices for the greater good of the whole company.

Today, SMSTI employees feel good about themselves and where they have taken the company over the last four (4) years! However, Deirio IV knows the organization must continue to change and aggressively rise to the next level. "What we did the last four(4) years enable us to survive, gained strength and confidence" he says. "Now we'd like to set the table so we can prosper and grow further."

He is wondering though if his people at SMSTI will still be able to follow him aggressively as before in the move to bring the company to more prosperity and further growth!

Q1. Is Modesto "Modie" Deirio IV a Good Leader or a Good Manager? Briefly explain your answer and cite examples.

Q2. If you were in the position of "Modie", what would be your first two steps to undertake in starting your journey to further prosperity and growth?