Table of Contents

Case Background Emmas Parlor

Statement of the Problem

Objectives 4
Analysis

Alternative Courses of Action 7

Recommendation
Case Background Who Gets the Project
Statement of the Problem

Objectives 3
Analysis

Alternative Courses of Action 4

Recommendation 19
References 32

I.

CASE BACKGROUND EMMAS PARLOR

Emma Lathbury, described as the indefatigable 52-year-old, left her nursing job
in the early 1990s due to burnout after working grueling hours, emotionally draining
work, and lack of both respect and autonomy. She opened a cozy Victorian tearoom
in the small Illinois farming community near where she lived and grew up. Emmas
parlor owes its success in part to perfect timing when specialty teas as in doubledigit annual growth. Emmas also worked hard for 60 and 70 hour per week,
personally chose the colors for the cottages exterior, hung the lace curtains,
selected the fresh flowers that grace the small circular tables, hired the staff, and
tracked down and tested recipes for the finger sandwiches, scones, jams and
Battenburg cake.
Emmas parlor earned glowing reviews in numerous guidebooks and a national
reputation. Upon realizing that special events were key to attracting customers, she
organized and publicized fanciful gatherings. The tearoom was nearly always
completely booked. Emma developed a real expertise when it came to teas. She
started by conducting evening workshops on the efficacy of organic teas in treating
everything from a simple upset stomach to menopausal distress. She began
blending her own Emmas Parlor Organic Teas and selling them to retail stores,
restaurants and individuals over the Web. The Web-based business flourished,
generating slightly less revenue than she was realizing from the tearoom. Also, the
profit margins were higher.
Now with two main business segments to operate, Emmas Parlor and Webbased Organic Teas is becoming too big for Emma to handle.
II.

STATEMENT OF THE PROBLEM

The growth of Emmas Parlor is becoming too big for Emma to handle. At this
stage of her business where expansion is imminent, she needed to consider all
possible business options.

III.

OBJECTIVES
1.

Emma should consider the best option given her

entrepreneurial traits, the stage of the business, and the pros and cons in
every alternative decision.

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2.

Clearly state the direction of the company whether to

expand or make some changes in the current structure to provide her enough
breathing space to continue.
IV.

ANALYSIS
The following are the pertinent insights re Emmas Parlor that could lead to the
decision-making:
Business Stage
If you piece the information from the case from the specialty teas potential
of earning double digit growth rate, 20 people employed, always fully booked
place, to expanding her scope to selling at retail stores, restaurants and Web, we
can say that Emmas Parlor is in Stage 3 or Success Stage of business growth
based on the Five Stages of Growth for an Entrepreneurial Company. At this
stage, the parlor is enjoying profit and Emma being involved established already
processes and procedures on how to run things. In this stage also, Emma can
opt to hire professional managers or supervisors to assume her role in operating
the business.
At Stage 3, this is where the management function of organizing is highly
utilized. Owners must learn to create organization structure that could cope with
the fast pace increase in size and growth of the company. But since the business
is still in the early success stage, Emma must decide whether to hire managers
and delegate tasks by creating a helpful operations manual to ensure
consistency and smooth transition.
If this is too taxing however, Emma can opt to let the Parlor remain as it is
without expanding. This will automatically qualify it under Stage 5 or Resource
Maturity Stage. This means that Emma, in her perspective chose to retain her
business solely for the purpose of catering to her customer base. Since she is
reluctant to expand, the management now is more focused in controlling which is
an indicator that the company is in its maturity stage.

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The same Success stage is true for Emmas web-based Organic Tea
business. Financial gains is stable with higher profit margin. The use of
technology promises a bigger opportunity for expansion.
Business Synergies
As Merriam-Webster defines it, synergy is the increased effectiveness that
results when two or more people or businesses work together. Emmas Parlor
and Web-based Organic Tea Business are different touch-points in her business.
The parlor as the physical store which can offer the ultimate tearoom experience
and the web-based store that prioritizes convenience. Both are catering to
different markets but has a common ground love for wellness and tea.
In the fast pace market environment, synergy is a critical factor in defining
the success of the company. Synergy in business is actually geared towards
implementing innovative approach in aligning processes, manpower, and
resources that cannibalization or eating up of market share will be avoided. It is a
commensal relationship where each business benefits. For example, the parlor
can focus on signature teas to create an exclusivity to customers that they can
avail of the excellent service and their favorite tea while enjoying the coziness
and ambiance of the place. As strategy, information on the website and other
social media accounts of the company will be posted within the premises to gain
more followers. Tie-ups can also be established like freebies on the spot upon
successful additional purchase in the web. More so, the web can be the place
where Emma can display all the teas included in the extensive selection. Online
stores benefits the company for gathering faster customer feedback and
implementation of cheaper Marketing strategies. With the use of social media,
the web-based business can easily get the pulse of the customers for further
marketing research, areas for improvement, and free publicity.
The web-based business can also help the company get its steady growth
if it decides to expand on untapped markets like young professionals, lactating
moms, etc.
Emmas Entrepreneurial Profile
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As an entrepreneur, Emma was brave enough to leave her job to venture

into business. Her work ethics is commendable locking in 60-70 hours per week
on the job. Emma shown distinct characteristics of an entrepreneur internal
locus of control, high energy level, need to achieve, awareness of passing time,
and self-confidence. Emma believed that she can make the business work and
she actually did.
Emma showed how focused she was when she turned her back to her
nursing job to venture into business. When she felt that everything she works
with doesnt make sense anymore, she easily challenged herself to break free
and make a drastic decision to achieve back her self-worth. The said action
reveals how Emma believes that her future is within her control and she was
willing to risk in order to be the boss of her own company. She seized the
opportunity right away when she saw the 1870s vintage Gothic Revival cottage
for sale displaying her decisive and risk-taker attitude.
The long hours Emma put in her business also exhibited her industry,
dedication, and will to succeed. She made sure that her expertise and skills are
utilized from conducting workshops on the efficacy of organic teas, to
conceptualizing and organizing special events to attract more customers. She is
a detail-oriented person.
The only counterproductive trait of Emma was her lower tolerance on
ambiguity. She buckled at the thought of handling a bigger business. She
demonstrates symptoms of burnout having in control of her business for long.
V.

She seems to have a hard time letting go of the reins.

ALTERNATIVE COURSES OF ACTION
The following are the alternative courses of actions based on the above analysis:
Action Action Description
1
Hire a
Manager/Supervisor

Pros
1. At Success Stage,

Cons
1. Risk of

managers will ease out

mismanagement if

the burden of exhausting

managers/supervisors

operational tasks.
2. Organizational

doesnt live up to

structure, processes, and

expectations.
2. Convoluted

procedures will be

processes if managers
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strengthened.
3. The owner can now
focus on the strategic

are not keen in

maintaining alignment
across the organization.

plans and other important

decision-making tasks.
4. Quality of products can
be maintained regardless
of expansion so long that
operational manuals are
being religiously followed.
5. Expansion could mean
more employees to hire
2

Choose One Main

and more people to help.

1. Product specialization

Business

can actually help the

company in directing all
efforts and improvements
into one major business.
2. Owner can have focus

1. Lesser profits.
2. Losing the
opportunity to help
other people through
hiring.

in one product making it

bearable in terms of effort
and time.
3. Quality of the product or
service can be sustained
given that there would
only be one business to
3

Sell the Business

monitor and operate.

1. Emma can earn money

1. There is no

banking on the good

guarantee that her

reputation of her company. new business venture

2. New capital to open a
will succeed.
new business which is
2. She will lose her
less tiring.
3. Emma is in her fifties

major source of
income.
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and stress could affect her

3. Her employees

health, selling the

might be affected by

business will spare her

the changes in the

from sickness and other

new management

diseases.

thus, will probably

threaten their source
of livelihood.

VI.

RECOMMENDATION
After considering the pros and cons above, Emma Lathbury should
consider Option 1, Hire a Manager/Supervisor, as the best alternative among
the three. Being an entrepreneur takes a lot of hard work, persistence,
determination, and even luck. Youll never know when another opportunity comes
knocking. So for Emma, while the business is in its Success stage, she should
grab the chance to continue pushing towards more success. Not all businesses
are given the same opportunity. More are failing even at the starting point.
Considering that her business is already in its expansion phase, it is the
right time to hire new managers/supervisors for her to delegate the tasks. Most of
the business decisions especially on a single proprietorship comes from the
owner. And any wrong move could eventually led to the demise of the company.
As the owner and business leader, Emma must fully grasp the concept of
management from planning, leading, organizing, and controlling. She can
actually start hiring on a smaller scale and will just continue doing so if the new
organizational structure works. By delegating tasks she can now focus on more
important things like assessing whether the business vision and mission are still
on point, financial projections, and regulatory compliance among the few.
Emmas business is no longer hers alone. She now have a social contract
with her suppliers, employees, and most especially with her customers. She
already has the fiery passion when she started so what she needed is to revive
that. She should get a much needed break to relax. Stress and burnout can
affect her productivity and creativity, and worse her health.

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As a leader, she should maintain the same level of tenacity to continue

being a role model to her employees. If they see that she is pessimistic about the
future, it could have a negative impact on her employees. And if customers sense
that the company seemed to be reluctant in implementing innovations, they will
always have an option to switch to competitors.

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