Subject category:
Strategy and General Management
Published by:
IBS Center for Management Research
Length: 24 pages
Data source: Published sources
Topics:
Organisational transformation; Business process reengineering; Organisational structure; Spaghetti organisation; Project-based organisation; Flat organisation structure; Matrix organisation; Customer orientation; Leadership; Change management; Management style; Decision-making; Communication; Innovation; Project management
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https://casecent.re/p/92905
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Abstract
This is a Simplified Chinese version. This case is about Denmark-based Oticon A/S, one of the world's leading developers, manufacturers, and wholesalers of hearing aids. In late 2008, the company was faced with some tough challenges due to factors such as the changing dynamics in the hearing aids industry and the global financial crisis. The case gives a detailed history of the company since the late 1980s, providing students with the scope to analyse the spaghetti organisation structure implemented by the company in the early 1990s and how it helped transform Oticon. Due to changes in market conditions and Oticon's slow reaction to the developments, the company lost market share in the late 1980s. In 1988, Oticon appointed Lars Kolind as its new CEO. As a strategy to help the company tide over the difficult scenario and come out strong against competitors, Kolind designed and introduced a pioneering effort in organisation structure and management style. The Oticon spaghetti organisation was characterised by a project-focus, lack of vertical hierarchies and physical barriers, a networked information system, and a paperless office environment where information was freely accessible to all. The case then goes on to discuss the reasons that led to a partial abandonment of the spaghetti structure around 1996, while the company continued to be a dominant player in the hearing aid industry with a continuous stream of product innovations. The case ends with a discussion of the market position of Oticon in late 2008 and the challenges faced by the company. The newly appointed executive board led by Chairman Niels Jacobsen (who succeeded Kolind as President in 1998) would have to overcome these challenges and steer Oticon through another turbulent phase.
About
Abstract
This is a Simplified Chinese version. This case is about Denmark-based Oticon A/S, one of the world's leading developers, manufacturers, and wholesalers of hearing aids. In late 2008, the company was faced with some tough challenges due to factors such as the changing dynamics in the hearing aids industry and the global financial crisis. The case gives a detailed history of the company since the late 1980s, providing students with the scope to analyse the spaghetti organisation structure implemented by the company in the early 1990s and how it helped transform Oticon. Due to changes in market conditions and Oticon's slow reaction to the developments, the company lost market share in the late 1980s. In 1988, Oticon appointed Lars Kolind as its new CEO. As a strategy to help the company tide over the difficult scenario and come out strong against competitors, Kolind designed and introduced a pioneering effort in organisation structure and management style. The Oticon spaghetti organisation was characterised by a project-focus, lack of vertical hierarchies and physical barriers, a networked information system, and a paperless office environment where information was freely accessible to all. The case then goes on to discuss the reasons that led to a partial abandonment of the spaghetti structure around 1996, while the company continued to be a dominant player in the hearing aid industry with a continuous stream of product innovations. The case ends with a discussion of the market position of Oticon in late 2008 and the challenges faced by the company. The newly appointed executive board led by Chairman Niels Jacobsen (who succeeded Kolind as President in 1998) would have to overcome these challenges and steer Oticon through another turbulent phase.