Organizational behaviour

Cross-Border Shopping

by

Steven L. McShane University of Western Australia Perth, Australia

Copyright © 1991 Steven L. McShane. This case is adapted slightly from actual events reported confidentially to the author. Names, locations, and industry have been changed.

This case may be used by current adopters of:
S. L. McShane Canadian Organizational Behaviour, 5th ed. (Toronto: McGraw-Hill Ryerson, 2004); S. L. McShane & M. A. von Glinow, Organizational Behavior, 3rd ed. (Boston: McGraw-Hill, 2005); S. L. McShane & T. Travaglione, Organisational Behaviour on the Pacific Rim, 1st ed. (Sydney: McGraw-Hill Australia, 2003)

Cross-Border Shopping∗ By Steven L. McShane, The University of Western Australia

Jack Tremblay was delighted to receive a job offer from the Canadian subsidiary of TGZ Technologies Inc., a California-based manufacturer of mini-computers. Tremblay was hired as a systems engineer in the Montreal office to install the company’s product and serve as a troubleshooter for clients who experienced problems.

During his first two weeks of work, Jack accompanied experienced systems engineers from the Montreal office to see how TGZ’s products were installed. Jack had been a systems engineer in a related business for five years, so he could understand many of the steps the experienced engineers went through to install the equipment. However, every client has unique requests, so Jack could not install these systems until he received formal training from the company’s head office in California.

At the end of two weeks, Jack was sent for an intensive one-week training program in California where he learned how to install different types of TGZ computers in a variety of situations. Jack met other recently-hired systems engineers from across North America, including four other Canadians. It was a high-spirited gathering where the learning was intense and close friendships were formed. Jack returned to the Montreal office even more dedicated to the company than before and highly motivated to work with clients to install and service TGZ’s products.

After three months of work, Jack returned to TGZ’s head office in California for another four days of training. The program included many of the same people he had met in the previous program. On the third day of training, Jack was approached by a production manager at TGZ’s California plant. He asked Jack to take a small package back with him to Montreal and handed over a small box containing several small components and circuits for a TGZ minicomputer that was about to be installed for a Montreal client. Although these pieces would fit into a shaving kit, they were worth several thousand dollars in the retail market. Jack asked whether these items should be declared at Canadian customs, but the manager quickly said “No. Uh, we will handle that. You just keep them in your luggage so that there’s no confusion with the customs papers we have sent already.”

∗ Copyright © 1991 Steven L. McShane. This case is adapted slightly from actual events reported confidentially to the author. Names, locations, and industry have been changed.

Cross-Border Shopping

Copyright © 2004 McGraw-Hill Ryerson Limited

Page 2

Upon his arrival in the Montreal office, Jack gave the package to the regional manager who was expecting it. “You had no trouble with Canada Customs, of course?” asked the manager. Jack explained that he said nothing about the box and was not given any special inspection. He then asked why there was so much concern about getting across the border with the parts if the customs papers had already been processed.

The regional manager laughed as he replied: “Is that what Choy (the production manager) told you? I bring these things across all the time. Besides, the duty is almost $500 on these parts. If we claimed everything we imported, we would probably have to raise prices by 5 or 10 percent or transfer service work to our offices in New York. And that would put you out of work! Now don’t you worry about a thing.”

Jack was stunned, but left without showing any emotion. He now realized that his action had violated Canadian customs law and that he may be asked to do so again. Jack decided to call the systems engineer from TGZ’s Calgary office with whom he had become friends at the California training sessions. The systems engineer from Calgary said that she did not have any such experience, but her regional manager had just been hired and might not know about the practice. She suggested that Jack shouldn’t worry about the incident. She was sure that import duties would be eliminated from these components over the next few years. Jack thanked his colleague for the advice and then sat in his office to decide how to handle this situation.

Copyright © 2004 McGraw-Hill Ryerson Limited Page 3

Western Agencies Ltd.

by
Steven L. McShane University of Western Australia Perth, Australia

Copyright © 1991 Steven L. McShane. This case is based on actual events described in a Canadian court case. Only the dates and names of the main parties have been changed.

This case may be used by current adopters of:
S. L. McShane Canadian Organizational Behaviour, 5th ed. (Toronto: McGraw-Hill Ryerson, 2004); S. L. McShane & M. A. von Glinow, Organizational Behavior, 3rd ed. (Boston: McGraw-Hill, 2005); S. L. McShane & T. Travaglione, Organisational Behaviour on the Pacific Rim, 1st ed. (Sydney: McGraw-Hill Australia, 2003)

Western Agencies Ltd.∗ By Steven L. McShane, The University of Western Australia

Western Agencies Ltd. is a manufacturers’ agent representing Stanfields, McGregors, and several other men’s fashion manufacturers in Western Canada and the Pacific Northwest of the United States. Jack Arthurs began his employment at Western as a warehouse worker in 1962. In 1965, he became a sales representative and was given responsibility for the company’s business in the interior region of British Columbia. In 1973, he was transferred back to Vancouver and assigned several large accounts, including all Eaton’s stores in the Lower Mainland.

Over the years, Arthurs bought shares in the company and, by 1979, held nearly one-third of the company’s issued nonvoting shares. He also enjoyed a special status with the company founder and president, Mr. A. B. Jackson. Arthurs was generally considered Jackson’s “number 1 man” and the president frequently sought Arthurs’s ideas on various company policies and practices.

In 1980, the senior Mr. Jackson retired as president of Western Agencies and his son, C. D. Jackson, became president. C. D. Jackson was seven years younger than Arthurs and had begun his career in the warehouse under Arthurs’s direct supervision. Arthurs had no illusions of becoming president of Western, saying that he had neither the education nor the skills for the job. However, he did expect to continue his special position as the top salesperson in the company, although this was not directly discussed with the new president.

Until 1987, Arthurs had an unblemished performance record as a sales representative. He had built up numerous accounts and was able to service these clients effectively. But Arthurs’s performance began to change for the worse when Eaton’s changed its buying procedures and hired a new buyer for Western Canada. Arthurs disliked Eaton’s new procedures and openly complained to the retailer’s new buyer and to her superiors. The Eaton’s buyer resented Arthurs’s behaviour and finally asked her boss to call Western Agencies to have Arthurs replaced. The Eaton’s manager advised Jackson of the problem and suggested that another salesperson should be assigned to the Eaton’s account. Jackson was aware of the conflict and had advised Arthurs a few months earlier that he should be more cooperative with the Eaton’s buyer. Following the formal complaint, Jackson assigned another salesperson to Eaton’s and gave Arthurs the Hudson Bay account in exchange. Jackson did not mention the formal complaint from Eaton’s and, in fact,

∗ Copyright © 1991 Steven L. McShane. This case is based on actual events described in a Canadian court case. Only the dates and names of the main parties have been changed.

Western Agencies Ltd.

Copyright © 2004 McGraw-Hill Ryerson Limited Page 2

Arthurs believed that the account switch was due to an internal reorganization for the benefit of other salespeople employed at Western Agencies Ltd.

At about this time, several employees noticed that Arthurs was developing a negative attitude toward his clients and Jackson. He was increasingly irritable and rude to customers, and was making derogatory comments to Jackson. Arthurs even advised some of the younger employees that they should leave Western Agencies Ltd. and get into a sensible business. A phenomenon known as “pulling an Arthurs” became a topic of discussion around the office, whereby Arthurs would leave the office to go home in the midafternoon after announcing that he had had enough. Co-workers also noticed that Arthurs was becoming increasingly forgetful. He was often unable to remember stock numbers, colour codes, product lines, packaging modes, and other information essential for serving clients efficiently and completing orders accurately. These problems were subtle in 1987, but became quite pronounced and embarrassing over the next three years.

In May 1989, Arthurs and Jackson had a conflict relating to the purchase of a new company car. According to Jackson, Arthurs presented him with a quotation for a car which, in Jackson’s view, included $2,500 in unnecessary options. Jackson informed Arthurs of his concerns and instructed him to find a car worth $13,000 instead of $16,000. Jackson then left town on business and when he returned was distressed to find that Arthurs had made his proposed car purchase with almost all of the unnecessary options. Jackson issued the cheque to pay for the car, but also included a note to Arthurs saying that he had lost confidence in the sales representative. It was about this time that Jackson contemplated firing Arthurs, but decided instead to be a “nice guy” and overlook the matter.

At the end of 1989, Jackson decided to reassign the North Vancouver independent accounts from Arthurs to another Western Agencies salesperson because the existing accounts had shown minimal growth and no new accounts were being added. Arthurs acknowledged that he had no time to find new accounts, but he denied Jackson’s allegation that he was inadequately servicing the existing retailers in that area. At least one retailer later stated that Arthurs serviced his account well. Moreover, the salesperson assigned this territory added only a couple new accounts over the next two years.

In early 1990, the vice-president of marketing for Fields Stores called Jackson to say that Arthurs was not providing satisfactory service and that action should be taken if Western wanted to keep the Fields account. Arthurs had handled the Fields account for four or five years and there had been no problems until a new Fields buyer arrived. The new buyer complained that Arthurs was not providing sufficient promotional advice and assistance. She also expected Arthurs to take inventory counts, a practice that Arthurs resented and did not feel was properly part of his job. This was not the only retailer who expected Arthurs to count inventory, but Arthurs let them as well as Jackson know that he was an account builder, not an inventory stock counter. Eventually, the Fields buyer did not want to deal with Arthurs at all. In March 1990, matters were brought to a head when the Fields buyer and Arthurs had a major disagreement and Arthurs was not allowed back

Copyright © 2004 McGraw-Hill Ryerson Limited Page 3
Western Agencies Ltd.

into any Fields stores. At this point, Jackson personally took over the Fields account and sales volume doubled within a few months.

A few months later, Western Agencies suffered several embarrassments over Arthurs’s mishandling of the Work Wear World account. Arthurs had landed the Work Wear account a few years earlier when it was a small retailer with only two stores, but the company had subsequently grown into a regional chain of 10 stores. Problems began when Arthurs persuaded the Work Wear buyer to purchase a new line of stock by promising a manufacturer’s allowance on an older line of goods. Arthurs had no authority to do this and, when the manufacturer refused to provide the allowance, Jackson had to personally explain that the allowance promise could not be honoured.

In late 1990, Arthurs mistakenly tripled a stock order for three of Work Wear’s stores. This error was discovered when the second shipment arrived and Jackson instructed Arthurs to take immediate steps to cancel the third order. Arthurs failed to do so and Work Wear wound up with three times the inventory it had ordered. Work Wear’s buyer subsequently gave Jackson the distinct impression that he should remove Arthurs from the account or risk losing Work Wear’s business altogether.

For Jackson, Work Wear World’s complaint was the last straw. In the spring of 1991, based on the series of incidents since 1987, Arthurs was dismissed from his job at Western Agencies Ltd.

Gull Products Incorporated

by

James Buchowsky Saskatchewan Institute of Applied Science & Technology Moose Jaw, Saskatchewan

This case may be used by current adopters of:
S. L. McShane Canadian Organizational Behaviour, 5th ed. (Toronto: McGraw-Hill Ryerson, 2004); S. L. McShane & M. A. von Glinow, Organizational Behavior, 3rd ed. (Boston: McGraw-Hill, 2005); S. L. McShane & T. Travaglione, Organisational Behaviour on the Pacific Rim, 1st ed. (Sydney: McGraw-Hill Australia, 2003)
Copyright © 2004 McGraw-Hill Ryerson Limited
Gull Products Incorporated

By James Buchowsky, Saskatchewan Institute of Applied Science & Technology

Gull Products Inc.

is a small business in Moose Jaw that supplies commercial products to other regional businesses. Recently there has been a movement of national and multinational corporations into that area. One of these corporations, Delnex, has just begun operations in the city and Gull’s ownership is very excited about the potential to do business.

Gull’s sales department has scheduled a meeting to discuss how best to approach this opportunity. Leading the discussion is Phil, the sales supervisor. While never having been a field representative himself, Phil does have strong management credentials and keeps the department running. Also present at the meeting are the four members of Gull’s sales team.

First, Bob is the most experienced salesperson and handles many of the larger, long-time accounts. Bob keeps all his current clients happy, but Phil is not pleased with his lack of new clients. Next, John is a good, hard-working employee, but Phil doesn’t consider him a spectacular seller. Third, Cindy recently transferred into sales from another position with Gull. Due to her inexperience, Cindy’s only clients are the ones Phil selects as being a “good fit” for her such as a local clothing manufacturer. Most people at Gull don’t know about Cindy’s previous work experience in Quebec where she had contacts with many big businesses including Delnex. The last salesperson is Joe. Phil doesn’t reveal the informal “salesman of the year award” until year end but he already expects Joe to win due to his aggressive selling lately. Yet, Phil rarely even discusses sales issues with him. Instead, most of their conversations centre on their passion – golf. Phil always coaxes Joe for the inside scoop about the private country club Joe is a member at.

The conversation at the sales meeting progressed as follows:

Phil:

Bob: Phil:

Delnex has the potential to be our biggest account for a long time. They’re a key for our future and we all should play a role in getting business from them. I’m looking for input on how to approach them and who will be the front man. Bob, what are your thoughts?

Whoever pursues this one is going to have to devote a lot of time and I just don’t have any to commit. Sorry, Phil.

Oh, alright, but we are going to need to draw on your experience somehow. John, we may need a team effort for Delnex so expect to do some leg work and provide backup, okay?

Copyright © 2004 McGraw-Hill Ryerson Limited Page 2
Gull Products Inc.

John: Sure, I’ll be glad to pitch in any way I can.

Joe: Looks like I’ll be quarter-backing this one. Phil, what say you and I invite a couple of Delnex guys for a round at my club?

Phil: Now you’re talking! I’d love to play that course.

Cindy: I don’t think being too forward is a good idea. An informative soft sell worked best when I was…

Phil: I don’t think a feminine approach is needed here. Joe, book a tee time while I give the Delnex manager a call. Meeting adjourned.

Assignment 1: Orientation to Organizational Behaviour

(Total Marks = 100)

ANSWER Parts 1, 2, 3, and EITHER Part 4 OR

Part 5

.

Part 1

Read Additional Case 6: Northwest Canadian Forest Products Limited (Revised) (pp. CA-10 to CA-12 of your textbook)

The open system perspective of organizational effectiveness emphasizes the importance of internal subsystems coordinating with each other. Clearly, the subsystems are not in coordination at Northwest Canadian Forest Products.

Question 1 (25 marks)

What are the problems in this case from management’s perspective and from the perspective of the union/employees? 

Are these problems connected/related to one another? Explain why or why not.

Part 2

Read the Case Study: 

Western Agencies Ltd. Case

Question 1 (20 marks)

Which variable of the MARS model of individual behaviour and performance is most valuable in explaining the alleged poor performance of Arthurs? Explain why, with specific reference to the various instances of poor performance described in the case.

Question 2 (5 marks)

Outline what Jackson could have done to help Arthurs improve his performance.

Part 3

Read the Case Study: 

Cross Border Case

Question 1 (15 marks)

What should Jack do in this situation? Explain why.

Question 2 (10 marks)

For the past few years, the design department of a small (40-employee) company has been using a particular software program, but the three employees who use the software have been complaining for more than a year that the software is out of date and is slowing down their performance. The department agreed to switch to a competing software program, costing several thousand dollars. However, the next version won’t be released for 6 months, and buying the current version will not allow much discount on the next version. The company has put in advance orders for the next version. Meanwhile, one employee was able to get a copy of the current version of the software from a friend in the industry. The company has allowed the three employees to use this current version of the software even though they did not pay for it. 

Determine the extent to which the design department’s action was ethical or unethical.

ANSWER Part 4 OR Part 5

ANSWER Part 4 if you wish to gain practical experience of some of the team assessment issues that you are learning in the course. 

ANSWER Part 5 if you are unable to form a team or prefer to answer a further module-related question.

Part 4: Team Development—Forming

Question 1 (25 marks)

Report on the following aspects of forming your team:

· The statement of team name, goal, and ground rules, or norms 

· A concise factual description of your team’s forming process (50–100 words) 

· A concise comparison (100–150 words) between your team’s forming and the theoretical characteristics of the forming stage (pp. 205–206 in your textbook), including possible reasons for the similarities and differences 

Part 5

Read the Case Study: 

Gull Products Incorporated Case

Question 1 (15 marks)

Discuss how stereotyping influences the perceptual process. Is Phil engaging in stereotyping? Explain why or why not.

Question 2 (10 marks)

Stereotyping aside, identify two perceptional errors that Phil is actually making.