1

MANAGING PEOPLE

WRITTEN ASSESMENT OF CASE

MOD IV PRODUCT DEVELOPMENT TEAM

Instructor : Dr Anwar Khurshid

Submitted By
Roll Number : 16040014

Background
Honeywell building controls division (BCD) was created as part of recovery process in 1985,
when Honeywell lost money in 1981 and the residential and building control division was split
after management change. Since then it is in the business of producing climate control systems
for four market areas : heating- ventilating and air-conditioning (HVAC), burners and boilers,
lighting, and water products. The division employed 1250 people and dealt with two types of
customers, original equipment manufacturers and trade customers. BCDs profitability and return
on investment are well above industry averages.
Currently BCD is working to introduce MOD IV, a motor used in HVAC applications,
representing the most ambitious project in the history of the division. MOD IV is aimed at costreduction and quality-improvement, and deemed as a flexible manufacturing project. BCD
planned to automate its entire assembly process and replace four families of motors with MOD
IV i.e. a total of 200,000 motors, generating revenue to the tune of $20 million per year. BCD
was spending $19 million to develop MOD IV to replace products accounting for over 30% of
divisions profit. MOD IV project was conceived in 1981 but the division is still struggling to
stay on schedule in April 1989, with only four months remaining for its contemplated
introduction into the market.
Forces Compelling Change
In the old system of product development, product passed through each functional area in a
sequential manner thereby not only consuming lot of time but also increasing the cost of entire
process, besides creating interdepartmental rifts. After the creation of BCD, it integrated the three
major functional areas of marketing, design/engineering and manufacturing, and introduced a
process of parallel development in order to transform itself into an agile organization capable of
outmaneuvering its competitors. Major reasons for changes are:

Recover from a period of unprofitability.

Establish itself as a stand-alone division.
Keep pace with changing technology and rapid changes in the control business.
Outmaneuver the competitors as initially it had 2-3 competitors only, whereas now it has

to compete with around 150-160 competitors of all types.

Customers were demanding a different set of requirements.

Undertaking the most ambitious project of its history i.e. MOD IV.
Switching from sequential development to parallel development.
Improving efficiency of cross functional teams.

Causes of Conflict
Starting from mutual non-collaboration during initial period of sequential development, differing
perceptions of critical functional areas about each other, power struggle, limited resources, nonaligned priorities, performance deficiencies, disagreement about strategy by marketers, poor
communications and limited intervention by management, all resulting in delays and difficulties
to stay on schedule are some of the causes of conflict.

Non-Collaboration. Process of sequential development resulted in non-collaboration

among critical functional areas, as marketers conceived a product idea passed it on to
design people who would design it and then forward it to process engineers who
determined how to make it and finally passed it to manufacturing engineers. At each
stage in the sequence, people encountered problems created by work done at earlier
stages and worked in complete disregard to each others requirements not only causing
conflict but also wasting time and resources. This tendency was however mitigated by
integrating these functional areas through formation of core team by adopting parallel

development process.
Different Perceptions.

Different perceptions of marketing, manufacturing and

engineering departments also resulted in conflict. Engineering people thought that

marketing people have no idea about their problems and difficulties, are being pushed
for unrealistic timelines and marketing people are calling the shots, whereas marketing
people perceived it to be an engineering driven project and were concerned about

revenue.
Disagreement with Strategy. Marketing people were initially not fully supporting the
project as they were concerned about customer appeal. Moreover, frequent changing of
marketing people led to swinging direction and delay in establishing marketing team,
whereas engineering and manufacturing people remained unchanged and got

entrenched.
Non Aligned Prioritization. Pressure for timely development of product also caused
stress and heightened the animosity among departments. Limited resources and multiple

tasks with tight timelines disturbed the engineering people and they started setting their
own priorities which were not all the time in sync with the requirement of other

departments and thus created inter departmental rifts.

Poor communication. Poor communication between functional areas regarding
progress and commitment to various parts like control module besides interpretation of
literal meanings by engineering department about the single and double shaft motors

also caused conflict.

Performance deficiencies. Performance deficiencies on part of engineering as they
were struggling to tackle the noise of motor at a time when they were expected to
develop control module is also a source of conflict.

Team Work
BCD is divided into three functional departments of engineering, manufacturing and marketing.
After adoption of parallel development system the division created a core team from all
functional areas for better coordination from conceptual stage to final production. Members of
the team still reported to their functional managers, working simultaneously. However,
formulation of team inculcated team responsibility and discouraged the members to single
mindedly defend positions of their respective departments and enabled them to look at the bigger
picture. The members were able to understand each others concern, engineering started to
understand the requirements of consumers and manufacturers, marketing people developed
insights to the limitation of engineering and manufacturing department. Team could identify the
work problems and were able to prevent them and above all the team succeeded in reducing the
development time from 38 months to 14 months.
Composition of core team dispelled the inter department rivalry to quite an extent, but finger
pointing still occurred and antagonism did not evaporate completely, it can be attributed to
diverse goals and adversarial roles of different team members; like Larry whose emphasis was on
fastest and least expensive, whereas Phill was focused on customers need. Lack of
communication and recording of the decisions of meetings still required improvement. Proper
monitoring of the teams proceedings was not upto the mark which resulted in loosing discrete
checkpoints and definite meanings of the decisions of the meeting remained diluted. Absence of
formal team leader and explicit instructions for communicating the decisions of weekly cross

functional meetings by the team members to their respective functional managers inhibited the
desired synergy.
Team Leader
BCD is headed by John Bailey who is an ex Vice President marketing and knows the job pretty
well. He is not a natural team player but after assuming the role of General Manager BCD,
recognizes that he has to change his management style. Now he is more patient, consensus
oriented and encourages involvement of staff to create enabling environment for the division.
Although he is not the team leader for MOD IV but since the project is undergoing in his
division, therefore he is responsible for its success or failure.
Linda Whitman, director HVAC is the senior marketing person and had primary profit and loss
responsibility for MOD IV. Linda wanted to meet the dead lines which required collaborating
with engineering and manufacturing. Linda is the right person to be appointed as team leader as
she is responsible for profit and loss of MOD IV. She has a reputation of dramatically improving
the departments she supervised and organization, discipline and strong strategic planning are
Lindas hallmarks.
Measures to solve module problems
Linda Whitman as a team leader with formal authority and status, should assert herself in a firm
manner and do the following to solve the module problem: exhibit 1
Liaison. To speed up the rectification of noise problem and development of control
module, Linda should meet the functional heads and counter parts in engineering and
manufacturing department i.e. outside the vertical chain.
Monitoring. After giving the directions to her team and aligning the priorities of
different departments towards attainment of goal, she should follow up by not only
getting updates in the meetings but also keep scanning the environment for information.
Dissemination. In view of the mounting pressure from the management about cutting
costs and watch for return on investment, Linda should pass on some privileged
information to subordinates to build team responsibility.
Disturbance handler. Linda should proactively look for the bottle necks and play her
part to remove obstacles in the way of staying on schedule.

Resource allocator. To speed up the issues pending with engineering and manufacturing
she should divert more resources to these departments.

Exhibit 1
The Managers Role

Formal
authority and
Status

Interpersona
l Roles

Informationa
l Roles

Decisional
Roles
Entrepreneur

Figurehead

Monitor

Leader

Disseminator

Liaison

Spokes person

Disturbance
handler
Resource
Allocator
Negotiator