Case Name: Jones Company

Student Name: Ricky Sidhu

Student Number: 100201154

Short Cycle Process:

* I am the corporate controller and am to prepare a report to the president of JCL of my investigation into the areas of JCL that need management attention * The relevant events occur in 2002 * Events occur in Canada

Critical Issues

Organizational Structure – The president has an increasingly large workload which leads to the bottleneck effect, high rate of manager turnover, and purchase order lag.

Firm Unsure of Direction – Many managers have stated that the firm is unclear of where it is going with its divisions and a friend of the presidents suggested strategic planning may help with this issue.

Transfer Price – There is constant disagreement between the manufacturing division and the lumberyard division as to what the transfer price should be.

Selling Land – A developer has offered to purchase the current land and relocate the lumberyard to another comparable site.

Organizational Structure Analysis

During my investigation I discovered that the president a significantly heavier workload than all the managers. This heavy workload has led to what is known as the bottleneck effect. A bottleneck is where the performance or capacity of an entire system, in this case the operations of the lumberyard, is limited by a single or limited number of components. The president is the component limiting the efficiency of the organizational structure to run the operations of lumberyard.

The president taking over a majority of the workload is leading to the managers having a limited scope in carrying out their responsibilities. This has led to the managers below the general manager to be unhappy and has resulted in a higher rate of manager turnover in the lumber division compared to their competitors. Moreover, the high turnover rate