Vick International is one of nine operating divisions within Richardson-Merrell, Inc. Each division is given considerable independence in running their business, so long as they contribute to the company’s goals of stable growth, improving profitability, and product excellence. When Tom McGuire became the president of Vick International, Latin American/Far East (LA/FE) in 1969 and the division was having difficulty sustaining adequate growth and profitability. The division had missed its budgets by wide margins in the previous two years, and even after McGuire made changes to the budget system, and tracking and control mechanisms the division failed to meet the budgets the following two years. The current business strategy was based on running with products already developed by other divisions within the company. During the 1960’s, Vick had set up manufacturing and distribution operations in a large number of countries, and as a result the management has emphasized on sales generation to cover the substantial overhead. McGuire’s focus is now to direct the division’s resources and energies into analyzing consumer needs, develop products to meet those needs, and improve communication with consumers about product availability and performance.
McGuire’s intentions are clearly aligned with RMI’s management philosophy of managerial independence in decision-making as he intends on delegating more responsibility for key managerial decisions to divisional managers; especially in marketing. One of the key factors of success for Vick is the materialization of this plan within the division. McGuire’s plan and philosophy requires flexibility and thoroughness for success. Flexibility seems to be suppressed as the Managing Dire ...