Rockwell Case Study
This paper will analyze the Case Study Is Rockwell Doing the Right Things? (George & Jones, 2002, pp. 501-502). The case study assesses the strategy and acquisitions of Rockwell International in response to defense spending cuts, which changed their organizational environment and performance. The Pentagon cut back about 50 percent on their spending due to the breakup of the Soviet Union and the end of the cold war. The reductions in Pentagon defense spending affected Rockwell and other big U.S. defense companies. The CEO of Rockwell decided that Rockwell needed to diversify by moving into the industrial and consumer products area thereby lessening its dependence on defense spending.A critical issue is the strategy Rockwell needed to develop in response to the performance threat caused by the cut in defense spending. The CEO realized that the company would need to diversify in order to increase organizational performance. The CEO chose to diversify Rockwell by buying strong companies in the industrial and consumer products area. The CEO thought that the companies would become stronger and more skilled with Rockwell's expertise. In turn, the new companies could be
Rockwell Automation now focuses exclusively on industrial automation. The strategy implemented by the CEO was to move the company away from its dependence on defense by transfer its expertise to the industrial and consumer products area. In 2001, Rockwell International changed its name to Rockwell Automation. The companies Rockwell was acquiring would possibly give Rockwell the long-term returns they were looking for to lead the company into the next century. Non-programmed decisions are based on information, a manager's intuition, and judgments (George & Jones, 2002, pp. The critical participants in this case study are Rockwell International, CEO Donald Beal and his management team, the team of Rockwell engineers and the companies Rockwell was acquiring. The CEO also assumed that the companies he was acquiring were industries where they could be the clear market leader. Retrieved February 17, 2004, from http://www. The reviewer based this analysis on the fact that the CEO created his new strategy to diversify the organization, overlooking the fact that at the same time most companies were focusing on one core business. Rockwell's current strategic vision was not responsive to the changing needs of their customers, the nation, and the world. In Rockwell reports 29 percent increase in 1999 earnings. Today, Rockwell continues to grow new businesses and realigns existing business to adjust for differing market conditions (Rockwell International Corporation, 1999).
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