Appex Corp (1)

APPEX CORPORATIO

NBy: Group 12

Chandani Arora

Kawalpreet Singh

Nakul Khandelwal

Navneet Sinha

Shubham Singh

BACKGROUND Appex Corporation was founded in May 1986 from the

merger of Appex, Inc. and Lunayach Communications Consultants(LCC).

The company had its headquarter in Waltham, MA. Provides management information systems and inter

carrier network services to cellular telephone companies. Also LCC provides design and engineering of cellular radio networks.

Since 1986, Appex has been at the forefront of the cellular communications revolution providing products and services to fuel its growth.

During 1987-1990, Appex has enjoyed revenue growth of over 1600%.

Rated as the fastest growing high-technology company in the United States in 1990 by Business Week.

PROBLEMS FACED BY THE COMPANY

No development of an underlying planning structure

Poor customer service(‘‘call you back attitude’’)

Loosely structured Failures in product development Loosing money rapidly

CAUSES

No defined organizational structure. Expenses were not monitored. No financial planning was there. No prior planning of work. No proper intra communication of

information. Employees lacked discipline.

DIFFERENT STRUCTURES ADOPTED BY APPEX

Innovative StructureCircularHorizontal Structure

Hierarchical, Functional StructureIntroduction of Product TeamsIntroduction of Business Teams

Divisional Structure

CIRCULAR STRUCTURE

Features Positive Effects Negative Effects

Non-hierarchical

Concentric circles expanding out from executives to customers

Free flow of information

customer-based

Employees were unfamiliar with the structure

Developed the mentality that customer was the enemy

Geared towards responsiveness and not towards planning

HORIZONTAL STRUCTURE

Features Positive Effects Negative Effects

Non-hierarchical

Separate sub units

Increases control within a sub unit

Employees did not respond enthusiastically

HIERARCHICAL, FUNCTIONAL STRUCTUREFeatures Positive Effects Negative Effects Functions are

organized as teams

Sub functions within teams

Growth of organizational chart

Focussed on completion of tasks

System of Accountability

Politics came into existence

Polarization of teams (restricting other departments involvement)

Sub-functions within a team

Source of authority became functional and not managerial

Personalities became more pronounced

PRODUCT TEAMSFeatures Positive Effects Negative Effects Separate teams

for each product

Product teams co-existed with functional teams

Functional teams were aware of all the product happenings on a daily basis

More focus on each product

Conflict of authority between product teams and functional teams

Resource allocation problems across teams

Increase in time spent on meetings

Product teams did not know about their authority.

BUSINESS TEAMSFeatures Positive Effects Negative Effects Teams acting as

intermediaries between the product teams and the corporate management team

Teams that operated on the same network and shared the same customer base reported to a business team

Authority lied in the hands of business teams

Problems related to resource allocations were solved

Decrease in revenue-producing people

Diminishing of customer focus

Infrastructure costs escalated

Less focus on company wide financial goals

DIVISIONAL STRUCTUREFeatures Positive Effects Negative Effects Functions are

grouped together according to specific demands of products, markets or customers(ICS & IS)

Greater horizontal and functional structure and more complex integrating mechanisms

Improved accountability, budgeting and planning

More focus on meeting financial targets

Increased cooperation among divisions

Bad sharing of resources

Divisions did not want to share resources

Little communication across divisions

No sense of financial accountability as sub divisions began to alter their financial statements

SUGGESTED SOLUTION

Rotation policy: Provide opportunities for team members from different divisions to be interchanged to enhance communication across divisions.

More focus must be given to cost and quality.

A separate division for customer care should be created.

There should be proper time management policies.

THANK YOU