Case Analysis

500 word speech which follows this structure:
– identifying the problems and challenges of leadership within the case
– defining leadership and discussing theory and a model whilst making a link to the case
– providing recommendations (very important)

Files uploaded:
“Case” – is the physical case itself
“Case Facts” – are what I’ve drawn out of the case to be important facts
“Leadership theory” – is all the theory, definitions and models provided about leadership and are crucially important to be used in the second

point i made about structure above
Case Facts

Chip Brownlee – CEO and chairman of Galvatrens
Harry Mart – COO of Galvatrens
Arch Carter – lead director of Galvatrens
Terry Samples – Mike’s boss vice president of sales
Mike Fields – Plaintiff (accuser)

Arch calls chip and says he received his voice mail. Chip responds that former divisional sales manager has filed a lawsuit against the company,

claiming he was wrongfully terminated for trying to report an illegal scheme to increase sales.

After reading through the lawsuit copy Chip had gotten a perspective on the multiple departures in Sales during the past 4 weeks.

The plaintiff was Mike Fields, who left Galvatrens 3 weeks earlier. He claimed that he came across a plan developed by another divisional sales

manager Greg Wilson.

Mike states that Greg Wilson had proposed shipping goods to a few of his bigger customers, billing them and booking the sales but with a side

agreement that they wouldn’t have to take ownership. They could also return the shipments at any time, and would get a 2% discount on any goods

they accepted and paid for in the following quarter. The purpose of this scheme was to meet quarterly sales targets and trigger bonuses.

Chip further explains to Arch that Mike found out accidentally and since he didn’t know who else might be involved he confidentially contacted

Harry the COO of Galvatrens. He said Harry never followed up with him and instead referred the matter to Mike’s boss Terry Samples.

Until a week ago before Terry left abruptly to take another job he was vice president of sales. Mike alleges that Terry told him his performance

was not up to snuff and that he’d have to accept a demotion and a transfer to Indianapolis if he wanted to stay with the company.

Mike believes that the demotion was because of exposing the illegal scheme and Terry knew as a divorced father with joint custody of his kids

that Mike couldn’t leave time.

So, was Terry involved?

Chip states that at that point they didn’t know whether Terry was involved and whether Greg followed through with the scheme.

Greg resigned about a month ago. He took a job in California.

When Terry left last week, Chip was wondering whether the confusion in sales was a coincidence
Mike also says the company’s channels for confidential reporting of misconduct don’t work very well as the company made it easier for Terry to


A board meeting was to be planned.

The board was delighted when Chip agreed to be CEO of Galvatrens in Jan 1997. He previously led Paloreq a pharmaceutical and medical devices

company during a period of tremendous growth. He attracted a team of stellar managers through the same sorts of “people” initiatives he would

launch at Galvatrens.

The year before Galvatren hired Chip it reached a deadlock with CEO Walter Nickels. Nickels ran in an authoritarian hierarchical style. As the

company grew the board urged he delegate more and instil fresh blood into the executive team and he resisted.

With the company deteriorating Chip stepped in. he expanded on Galvatrens core businesses in home health and personal beauty to nutritional and

wellness products, products for infants and the home. Revenues, earnings and share price increased steadily.

Chip sought a COO who could focus on the company’s day to day operations. Harry Mart who Chip lured away from a competitor fit the role nicely.

Chip also worked hard to change the company culture. Early in his tenure, he announced an ambitious initiative to make Galvatrens an

organization that excelled in listening to and learning from its employees to achieve preferred employer status in the consumer products


Chip replaced the general counsel with Sydney Baydown. She was Chip’s general counsel atPaloreq. At her urging Chip upgraded procedures for

uncovering misconduct and solving conflicts in the workplace. Chip gave Sydney approval for a firm to review Galvatrens existing system.

Following the consultants’ advice Galvatrens instituted wan open-door policy for raising workplace concerns. While the policy encourages

employees to go to their immediate supervisors, it emphasises that they could approach any manager at any level for assistance. The police

included a specific ban on retaliation.

The company also included a toll-free 24-hour hotline for reporting violations of the code of conduct, added an ethics officer to its ranks and

launched an ethics awareness campaign.

After the Sarbanese Oxley Act, the company mandated that the ethics officer inform the board’s audit committee of any allegation of financial

wrongdoing or other possible code violations that involved company executives

Two of the consultant’s recommendations weren’t followed: one was that the company should hire an ombudsman and that the board should make a

director or committee of directors responsible for overseeing ethics. Focus groups and interview reveal that many employees don’t feel

comfortable raising concerns through formal management. Having a truly impartial ombudsman who reported to the CEO and board would make

employees more likely to come forward. The ombudsman allows people to report issues confidentially and offers informal means for helping resolve


These ideas were opposed by Dale Willis the senior vice president of HR at the time.

Chip also agreed to Dale’s request of delaying training needed for the new open-door policy until HR completes existing programs. Other

priorities arose and this initiative was forgotten.

Three days after Mikes lawsuit had been filed chip opened a conference call with the 8 directors he could round up. Harry and Dan Richardson

were away.

Syd was asked to brief the group. She said, “we’ve confirmed that Greg Wilson pitched a channel-stuffing scheme to two of his biggest customers.

However, at this point it isn’t know if it got further than that. We’ve also determined Mikes performance declined considerably in his last 10

months here. Records show that his team missed sales targets by a growing amount during that period. He had been unreachable during business

hours with increasing frequency and had missed important meetings. Prior to that though he was a solid producer. Mike’s lawyer hadn’t disputed

the change in performance claims but claimed it was due to a nasty custody battle between him and his ex-wife. Terrys reaction to the slide in

performance had been brutal contributing to Mikes emotional stress. ‘

Given the above info the company intend to deny the charges in the charges of Mikes lawsuit and have an independent investigation on the

channel-stuffing allegation. Syd was asked to be the liaison between the outside investigators and the board

Shelia the chair of the board’s audit committee asked what should the board’s role be in the investigation? To who should the investigators

report? Do we need a special committee for something like this?

Arch the lead director said that should be sorted out but first there need to be a focus on responding to the lawsuit on how does battling a guy

who attempted to raise some allegations square with our missions and values? There are giant reputational risks on every front in this

situation. If this isn’t handed well we could hurt ourselves, with employees, customers and stakeholders.

A board meeting was scheduled for six weeks where more facts would be available and they would be in a better position to weigh their options

The board met six weeks later and Harry the COO was absent again because of continuing problems at factories damaged by hurricanes.

The independent investigators had reported back stating that the customers had simply ignored Greg Wilson’s channel stuffing proposal. Terry had

forced Greg out when he learned about the plan, but he allowed Greg to resign and hadn’t told anyone else about the scheme. Greg has not

responded to the investigators and Terry’s reply was through his lawyer saying he’d review the questions and respond appropriately.
Investigators also confirmed that Mikes performance had declined and Terry role in it was Murky. Mike had done his best to raise alarm on the

scheme. The judge had allowed discovery to begin and the company had initiated settlement discussions with Mike.

Dan was furious that they didn’t hear about the scheme earlier from Terry or their customer and was wondering whether other people in Sales knew

about it. He stated that it doesn’t seem we have a handle on these kinds of problems.

Syd pointed that in many cases employees that see misconduct in their organisations don’t come forward and that the company has come a long way

since Chip took over.

Shelia said but clearly the good things already put in place like the open-door policy and the code of conduct aren’t working. Harry didn’t take

the original complaint seriously and just passed the buck. Nothing came in through the hotline. And no one contacted the ethics officer or HR.

Arch stated that is it realistic to expect Harry to deal with this after all he’s responsible for?

Shelia stated it is not expected of him to personally investigate issues that come to him but he should follow up and refer this issue to the

ethics officer.

Chip states that he’s kept Harry plate full and has asked Syd to think about how we can ensure that things like this don’t fall through the

cracks again.

Shelia and Arch met for breakfast the next morning.

Arch said he’s thinking they need a board retreat. I don’t think we’ve met our oversight responsibilities. We were not ready for something like


Shelia agrees and said once we got into this thing it seemed clear we as a board didn’t know what our role was supposed to be. And I certainly

took it for granted that Chip and Syd had established the board for anonymous reporting that the audit committee and the full board for that

matter needs to provide oversight.

Arch said it’s got to show up in our self-evaluation this year. And several aspects must be considered when evaluating Chip and deciding what we

should ask of him in the future. he also says after putting all these procedures in place why did only one guy come forward – and he ends up

suing us? When the new surveys come out I’ll be curious to know if were really improving morale especially in Sales where there’s been so much


Shelia said she agrees about Chip but the person who worries her is Harry. Harry may be technically strong but he has got to be able to take

care of people, and he’s just not good at it. I think there need to be consequences for Harry and new expectations for Chip


Skills of a leader
Skill 1: Tuning in to the environment: Sensing needs and opportunities
Skill 2: Kaleidoscope thinking: Stimulating breakthrough ideas
Skill 3: Setting the theme: Communicating inspiring visions
Skill 4: Enlisting backers and supporters: Getting buy‐in and building coalitions
Skill 5: Developing the dream: Nurturing the working team
Skill 6: Mastering the difficult middles: Persisting and persevering
Skill 7: Celebrating accomplishments: Making everyone a hero

Key triggers of leadership development
1. Significant leadership challenge at an early age
2. Positive role models
3. Being ‘thrown in at the deep end’
4. Mentoring, coaching and consultant relationships
5. Experiential leadership development courses
6. Negative role models
7. MBA and professional qualifications
8. International or multicultural exposure
9. Voluntary and community work
10. Team sports

Change leadership
Different to ‘formal’ leadership
• involves specific interventions aimed at motivating behavioural change among employees
• Focuses on actions and behaviours rather than formal ‘positions’
• Judged by the impact those actions and behaviours exert on the change process

Core tasks of a change leader
1. Develop and articulate clear and consistent sense of purpose and direction for the organisation
2. Establish demanding performance expectations
3. Enable upward communication
4. Forge an emotional bond between employeesand the organisation
5. Develop future change leaders

Core roles of a change leader
1. Energising and instilling a readiness for change
2. Crafting a vision and setting direction
3. Leadership commitment & involvement
4. Reinforcing the message and institutionalising the new behaviours.

Change Leadership & Phases of Change Burke (2008)

Stace&Dunphy contingency model of change

Beyond the charismatic leader Nadler and Tushman (1990)

A change agent is …
1. a person who seeks “to reconfigure an organisation’s roles, responsibilities, structures, outputs, processes, systems, technology or

otherresources” (Buchanan, D. &Badham, R. (1999) Politics and organizational change: the lived experience. Human Relations, 52 (5): 609‐629)
2. the people responsible for directing, organising andfacilitating change in organisations (Burnes, B. (2004)Managing change: a strategic

approach to organisational dynamics. Financial Times Prentice Hall)

Change agents:
• Manager/ consultant/ project manager 
• Understand they impact people as well astechnology, resources, structures
• Continually observe and search for new ways of making change happen‘change begins with me’
Roles of a change agent
Change strategist (change leader) 
Change implementer
Change recipients

‘Consultant’ style Waddell et al (2011)