Celeritas, Inc

Leadership Challenges in a Fast-Growth Industry

Anusha De, Josh De Anda, Aaron Garay, George Gilbert, Atulya Vaidya, Jessica Zhang
Dr. Dan Pryor
Business Communications: Oral and Written
18 April 2018
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Table of Contents

Section One 2
History 3
Context 3
Challenges 4
Vision 4
Communication 4
Collaboration 4
Proposed Solutions 5
Vision 5
Communication 5
Collaboration 6
Evaluation Criteria 6
Timeline 7
Impact 7
Costs 7
Section Two 8
Group Summary of Videotape Review of Oral Presentation 9
Individual Group Learnings 9
Anusha De 9
Josh De Anda 9
Aaron Garay 10
George Gilbert 10
Atulya Vaidya 10
Jessica Zhang 10
References 12
Appendix A: Interview with Dr. Steven M. Gray 14
Appendix B: Interview with Jan Brusevold 24
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Section One
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History

Josh - Celeritas is a leading firm in the enterprise network optimization industry that’s focused
on providing businesses with solutions to accelerate and enhance their existing computer
networks. Their industry revenue is largely based on wide area network (WAN) acceleration, a
$1.1 billion market projected to grow by 20% over the next several years, experiencing a 50%
compound annual growth rate (CAGR) by year 2022 (Anand, 2018). The advent of cloud
computing technology in 2011 presented a new market opportunity for Celeritas, at which point
Celeritas started launching products to enhance the new cloud computing ecosystem.

Josh - Philip Boyer is the founder, CEO, and president of Celeritas, Inc. He earned his Ph. D in
Electrical Engineering and Computer Science from the University of California at Berkeley. He
did his postdoctoral work at the Massachusetts Institute of Technology (MIT) where he worked
for six years. Philip Boyer went on to found Celeritas in 2003. His team was comprised of five
other individuals who held graduate degrees from MIT and one highly experienced salesperson.
Shawna Davis is the SVP of Business and the CFO of Celeritas. Her background is in
communication where she completed her Bachelor’s degree at Boston University and her MBA
at MIT’s Sloan School of Management. The SVP Research and Chief Scientist, Vishal Arul,
earned his Bachelor of Science and his Ph.D. in Mathematics from MIT.

Context

Jessica - After Celeritas’ founding in 2003, the company saw astronomical growth with total
revenue more than doubling each year. This trend continued until 2008. Then, growth slowed to
40%. Until 2011, it remained over 20%, but at the start of the year, Celeritas missed its first two
quarterly sales targets. They lowered its projected revenue to $280 million, a mere 17% increase
following the year before. This decrease made Celeritas vulnerable, as several of their esteemed
competitors were experiencing greater growth in the past few years. Each of the executives at
Celeritas disagreed about what the source of this downturn was. They all perceived their
respective areas as successful, arguing that the other SVPs had failed to meet expectations.

Anusha - Boyer suspected that Celeritas’ financial problems were a result of deeper relational
issues within the company: high employee turnover, low company morale, and lack of
coordination between divisions. Boyer previously attempted to resolve these issues by employing
an organizational expert. However, this effort failed largely due to resistance and a lack of faith
in the organizational change process from the senior management team. Consequently, Boyer
employed Carla Reese, a well-respected organizational consultant who had experience working
with fast-growing IT companies.

Anusha - Reese’s first step was to meet with Boyer. In this meeting, they discussed at length
Celeritas’ organizational structure and reporting relationships. Boyer explained that because of
Celeritas’ rapid employee growth, he needed an executive team he could rely on. While each of
his senior executives shone in their individual technical areas, they lacked the foresight and
vision to understand how their department fit into the big picture of the company. They also
failed to coordinate and communicate effectively. In light of these issues, Boyer wanted Reese to
focus on team-building and promote positive relationships within his executive team.
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Anusha - Reese went on to hold individual meetings with each of the five senior vice presidents.
Her goal was to gain the executives’ trust and understand their goals and objectives for their
departments and Celeritas as a whole. Reese found that all of the executives doubted Boyer’s
effectiveness as a leader and felt personal animosity against Dave Lloyd, the SVP of the Sales &
Marketing department.

Challenges

Vision

Aaron and In addition to not having clear company-wide goals, Celeritas lacked departmental
definition and roles. Sometimes, departments would have conflicting duties and other times they
would overlap. Many of these teams were driven by the over-ambitious sales team which would
make unreasonable projections that the engineering team could not complete. On another note,
engineering and research would frequently collide. Both teams would claim responsibility for
aspects of certain projects and refuse to collaborate with the other, hoarding resources and
causing inefficiency.

Communication

The second major challenge present in Celeritas is the lack of communication between the
executive managers. The communication issue stems from a lack of trust between the senior
Vice Presidents and the need of each Senior Vice President to push his or her agenda instead of
promoting the company. At the moment, Philip Boyer meets one on one with each Senior Vice
President, and his proposed solution changes every time he meets with a different Senior Vice
President. He usually accepts the solution of the final Senior Vice President he meets with
without taking into consideration the solutions or problems explained by the others. The distrust
between the six top members of Celeritas and the lack of information transfer has caused Boyer
to often make misguided decisions. The distrust peaked with the firing of David Lloyd.
However, communication is a two-way street; although Lloyd had his fair share of issues, the
problem still remains.

Collaboration

George and Josh - A third issue that plagues Celeritas is the lack of collaboration in the
workplace. Celeritas exhibits an internally competitive company culture where employees don’t
hold each other accountable. This leads to a situation where the various departments, or silos,
don’t work with each other and instead, members of individual silos are very competitive with
one another. When silos don’t coordinate with each other across departmental lines, animosity
and dysfunctionality is the result, as exemplified by Celeritas’ case.

George - Celeritas is also unable to consistently make decisions at the top levels of management.
Boyer would have one-on-one meetings with SVP’s. Boyer would make up his mind about an
issue, but when the next SVP walked into his office and explained their side of the issue, Boyer
would arrive at a different decision than the one before that. This constant roundabout stream of
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erratic decision making resulted in unclear goals and conflicting agendas that have been
detrimental to Celeritas. A CEO must be able to coordinate communication and decision making,
and Boyer’s inability to do just that is why this is such a pressing matter.

Proposed Solutions

Vision

After coming to a consensus on company-wide goals, each department within Celeritas should
determine what their individual goals are. Ideally, research and engineering would separate their
functions. Instead of being focused on the exact same tasks, research should provide engineering
with the data necessary for them to work on perfecting innovations and creating breakthroughs.
On the flip side, sales and marketing should be more in-tune with the engineering departments.
They should understand the practical constraints of the company, and only make promises and
projections based on what is truly possible.

Communication

Celeritas should improve the transparency and frequency of its communication. Transparency
can be facilitated by involving executives from all affected departments when making relevant
decisions. In this manner, Boyer will be able to make informed decisions and stick to them
instead of changing his mind when he receives new information. Furthermore, his executives
will be on the same page and understand the basis for major decisions. As for frequency, SVPs
should seek out updates from their vice presidents more often, and relay pertinent information to
Boyer in a time-effective manner.

In addition to being technically competent, SVPs should also have adequate communication
skills. Thus, Dave Lloyd’s replacement for the SVP of Sales & Marketing position should be an
employee from within the division who has good technical and communication skills.

The third step to solving the communication problem involves training and goal setting. Each
Senior Vice President and the CEO should be subject to a crash course two day training session
with an expert present to mediate the discussions. In addition, the CEO and SVPs should meet
with the expert once every week or every two weeks to enhance his or her communication skills.
The senior vice presidents also suffer from lack of accountability, as they are not held
responsible for the success or failure of their departments. In order to resolve this issue, the SVPs
should be forced to meet quarterly with an in house consulting liaison (provided by the
consultant) and outline the goals for the upcoming quarter. These goals should be feasible yet
challenging. At the end of the quarter, if the department meets the goals outlined by the SVP
then the SVP should retain his or her job. However, if the goals are not met then the SVPs
position should be reevaluated.

Collaboration

Josh - Another component to address Celeritas’ lack of collaboration is to facilitate the horizontal
flow of information across departments. This will entail ensuring that SVP’s work together
during their meetings in pursuit of new, clear, and agreed upon company goals that address the
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big picture. This is where Boyer has to step aside and allow for everyone to make their voice
heard and collectively decide on the best course of action.

George - Rather than Boyer making decisions individually with SVP’s, Boyer must now hear all
sides of an issue at once and together they can arrive at a common understanding. We seek to
encourage this kind of collaboration not just in the C-suite level but also across the various
departmental silos by combining forces across department lines. For example, members from
research and members from engineering will work on projects together so that silos are no longer
internally competitive but are now externally collaborative.

Evaluation Criteria

Atulya - Ultimately, it is the senior members of Celeritas’ choice as to which solution they adopt.
Regardless, the solution should have a set of criteria by which it should be evaluated to
determine its success.

1. The first form of evaluating the solution is a qualitative survey. Employees, specifically
Vice Presidents, should receive a survey before and after the training and collaboration
efforts have been implemented. In doing so, the employees can outline any changes that
they have seen to the communication or collaboration issues faced by the company.

2. The second criteria is more of a binary one. As aforementioned, the company has failed
the past two quarterly goals. One way to evaluate the effectiveness of the solution is if the
company and the various departments are able to pass the goals that they set.

3. The third criteria involves the clients of Celeritas. Celeritas is a company that works with
many other companies and helps them with technology issues. The problem at Celeritas
seems to be a relational one and the issues within the company may also be present
between the executives of Celeritas and the executives of the clients of Celeritas. In order
to measure improvement, each client should receive a qualitative survey before and after
the communication training for the Senior Vice Presidents and CEO.

4. The final criteria is the financials of the company. While it is unimaginable for Celeritas
to reach 200 percent growth as it had done previously, the company should bounce back
following the implemented solution. The success of the solution can be measured by the
quarterly and yearly growth of Celeritas.

Timeline

Recommendations for the first quarter include finding Dave Lloyd’s replacement, beginning all
executive training initiatives, and working with the SVPs to set performance goals for the trial
quarter.

In the second quarter of this initiative, the SVPs will be reevaluated under the aforementioned
criteria. This evaluation will determine if they need more training and if so, in what area. These
additional trainings could address managerial, interpersonal, communication-based, or
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performance-based problems. Following this step, Celeritas would choose a set of projects to
comprise their quarterly portfolio. Based on what they choose, departments will then set roles for
their employees.

In the fourth quarter, the in-house consultant will reevaluate the progress of Celeritas towards the
goals that it laid out in the second quarter. This quarter is much more open-ended and it is up to
the consultant to make adjustments to steer Celeritas towards its goals. At the end of this quarter,
the consultant will be able to leave and Celeritas will be self-sustaining.

Impact

Atulya - Celeritas is a company that is driven by research. The company’s ability to innovate
allowed it to be one of the major players in the 1.1 billion dollar market. However, the challenges
facing the company have halted the growth of innovation. The proposed solution should focus on
promoting innovation instead of diminishing it.

Costs

Atulya - The primary costs for implementing the proposed solution will consist of paying the
human resource professionals in charge of training the upper management to be more effective
communicators.
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Section Two
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Group Summary of Videotape Review of Oral Presentation

Pryor’s World-Class Consulting (PWC)’s solution for Celeritas, Inc. showcased the collective
effort of each individual group member. The attire was coordinated well and everyone
remembered his or her part; overall, the presentation went smoothly. Atulya Vaidya started by
explaining Celeritas’ beginning: six MIT post-graduates and one highly experienced salesperson
formed an IT company. Josh De Anda followed by mentioning the products and services of the
company. Aaron Garay then described its chief executives, and Jessica Zhang outlined Celeritas’
growth cycle and current predicament. Anusha De explained the steps that Celeritas had taken
prior to hiring PWC. George Gilbert proposed general, high-level solutions for the executive
board.

Every group member had a strong showing, giving their best presentations yet. However, each
person still had a few small areas where he or she could improve.

Individual Group Learnings

Anusha De

My main takeaway from the Capstone experience was a taste of a consultant’s job. I experienced
the process an organizational consultant would go through for a case: gathering data, meeting
with a team, arriving at a solution, and presenting to the company. I also discovered that
consultants work extensively with both qualitative and quantitative data. In regards to my own
working style, I learned that I prefer to create an overarching structure for large projects and fill
in the smaller details later. The next time I work on a similar group project, I will:

● prepare for meetings to maximize productivity,

● divide up the work early on in the project,

● set smaller goals before the due date to ensure progress, and

● brainstorm ideas individually before discussing them with the group.

Josh De Anda

Aaron Garay

George Gilbert
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My biggest takeaway from the Capstone experience was how complicated interpersonal conflict
can be when addressing how to solve it in the context of a business. It is really difficult to get
people, who struggle with communication and have animosity towards each other, to work well.
When the situation is at the top of a company, there are few plausible solutions available. I
learned that my working style is kind of in the spur of the moment, in meetings I came up with
ideas on the spot and worked best when working with the rest of the group, not when I was
working on parts by myself, such as preparing for the presentation. To improve myself, I will:

● Think about ideas on my own time instead of only when working with the group

● Work on my own as well as working with the group

● Listen to my team members better during meetings, paying more attention to not trying to
own the conversation

Atulya Vaidya

My biggest takeaway from the Capstone experience was the backlash faced by consultant groups
by the executives and employees of the main company. When looking at potential solutions, I
had to weigh in the feasibility of implementation because the company would be hesitant to
institute major changes. In this case, the “best” solution was often passed up for one that would
result in less layoffs or demotions. With regards to my working style, I realized that I am more
detailed oriented and want to outline a specific plan before working. There is some room for
improvement, so the next time I work on a group project or have a group presentation, I will:

● begin working on the project far in advance,

● work before the group meets instead of trying to do everything during the meetings, and

● ensure that the volume of my speaking does not die off near the end of sentences as it
often did during the presentation.

Jessica Zhang

The Capstone project was a unique educational experience that tested my communication skills
in a variety of ways. It highlighted the importance of clarity and awareness within all
interactions. Our group was the most efficient when people were able to slowly and clearly
explain their ideas and when the remainder of the group was willing to critically evaluate them.
These lessons carried over into Celeritas, Inc.’s fundamental problems: the reason why
consultants were needed in the first place. They were unwilling to accept their own faults and
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consider ways to improve their respective departments for the betterment of the company overall.
With this project, I learned that communication is two-sided; more than anything, it requires
listening and gauging a receiver’s reaction. Regarding myself, I learned that I prefer to come to
meetings with a set plan in mind. For similar circumstances in the future, I will:

● plan ahead when projects are initially handed out,

● set small, incremental goals working towards the completion of a project,

● consider unconventional solutions to problems, and

● incorporate more interesting details into my presentations.

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References

Anand, A. (2018, February 14). Software Defined Wide Area Network Market 2018 with
Focus on Emerging Technologies, Regional Trends, Competitive Landscape and Industry
Growth with 50% of CAGR by 2022. Retrieved April 11, 2018, from
http://www.crossroadstoday.com/story/37501950/software-defined-wide-area-network-
market-2018-with-focus-on-emerging-technologies-regional-trends-competitive-
landscape-and-industry-growth-with-50

Becker, J. (2016, January 4). The Best Way to Build Company Culture. Retrieved April
11, 2018, from http://fortune.com/2016/01/04/best-way-to-build-company-culture/

Christensen, C., Ertel, D., Gordon, M., Frei, F. X., Wang, D., & Van Bever, D. (2014,
October 24). Consulting on the Cusp of Disruption. Retrieved April 11, 2018, from
https://hbr.org/2013/10/consulting-on-the-cusp-of-disruption

Columbus, L. (2017, October 18). Cloud Computing Market Projected To Reach $411B
By 2020. Retrieved April 11, 2018, from
https://www.forbes.com/sites/louiscolumbus/2017/
10/18/cloud-computing-market-projected-to-reach-411b-by-2020/#207293b178f2

Hofstrand, D. (2009, December). Top Management and Key Personnel Positions in a

Business | Ag Decision Maker. Retrieved April 11, 2018, from
https://www.extension.iastate.edu/agdm/wholefarm/html/c5-111.html

HR Management. (2016, June 29). Overcoming Employee Resistance to Change in the

Workplace. Retrieved April 11, 2018, from https://www.paycor.com/resource-center/
Change-management-in-the-workplace-why-do-employees-resist-it

McDowell, B. (2017, July 31). How to Implement an Effective Performance

Management System. Retrieved April 11, 2018, from https://www.hrlocker.com/hr-
software/blog/implement-effective-performance-management-system/

MIT | Division of Student Life. (n.d.). Campus Activities Complex. Retrieved April 11,
2018, from https://studentlife.mit.edu/cac/event-services-spaces/adventures-tim-
beaver/mascot- history

Shaw, K. (2018, January 18). Wide-area networks: What WANs are and where they're
headed. Retrieved April 11, 2018, from
https://www.networkworld.com/article/3248989/lan-wan/ wide-area-networks-what-
wans-are-and-where-theyre-headed.html

Spadafora, A. (2018, March 01). Microsoft launches new AI and Cloud Computing tools
for intelligent health. Retrieved April 11, 2018, from
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https://www.itproportal.com/news/microsoft-launches-new-ai-and-cloud-computing-
tools-for-intelligent-health/

Wood, L. (2017, December 28). Network Optimization Services Market - Expected to

Reach USD 9 Billion By 2022 - Research and Markets. Retrieved April 11, 2018, from
https://www.businesswire.com/news/home/20171228005422/en/Network-Optimization-
Services-Market---Expected-Reach
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Appendix A: Interview with Dr. Steven M. Gray

Dr. Steven M. Gray is an Assistant Professor at The University of Texas at Austin. He earned his
Bachelor’s degree from Yale University in psychology and his Master’s from Columbia
University in Organizational Psychology. Before earning his Doctorate from Washington
University in St. Louis, with his dissertation focusing on the foundation of heterophilous
entrepreneurship groups, he was a consultant at IBM that advised Fortune 100 pharmaceutical
and telecommunications clients on developing human and social capital within their firms. His
current research concerns the effects of gender on venture team formation.

Jessica: What are effective ways to restructure a company where the leadership does not
communicate?

Dr. Gray: Okay, so if there are communication problems going on in the company, what are
some structural things to be done to overcome that liability? Okay. I guess it depends on nature
of communication problem. Hierarchies are set up for a couple of reasons. They’re meant to
facilitate a couple of things. One is top-down information flow in which having hierarchy
ensures that the information at top is acted on by people at bottom. That’s what hierarchy helps
facilitate--command and control; if we have this information and lay down this directive, you act
on it. Hierarchies are also supposed to facilitate bottom-up information flow in which entry-
level, first-line people identify problems and opportunities that are not visible to management.

These are kind of running contradictory to each other. To the extent that top-down directive
ordering of actions is important to the company, a hierarchy that is stratified, with multiple
layers, is a good thing. However, that comes at a cost. There’s a tradeoff, because as the
company becomes more hierarchical, it becomes harder for the bottom-up information to emerge
all the way to the top. Companies have this tradeoff in terms of vertical hierarchy with their
structure.

Is our problem getting compliance of action? In which case, the issue can be handled through
hierarchical differentiation. If the problem is “we can’t seem to identify problems or
opportunities on the front line”, then, hierarchy needs to be minimized. That’s the vertical
dimension of structure in organizational dynamics there, and you need to figure out which
problem is more relevant for the organization.

But, structures also have a horizontal dimension. This is kind of a grouping element. There are
tradeoffs amongst communication and information particularly in different grouping strategies.
So, one strategy is to have lots of groups. Think of them as departments or units--whatever it is.
The structure has these segmented units; that facilitates close interactions between those within
the units, so with things like outputs and productivity, if those are good, that is facilitated by
these clearly defined units. You’d want lots of separate units to be operating on an organizational
problem that is efficiency driven or productivity driven. The problem--now there’s a tradeoff--is
that if you have too many of these units, what becomes a challenge is that the flow across units
becomes impeded. And so the extent to which unit A has a problem that’s relevant to unit B, C,
D, and so on, having lots of predefined units becomes a major problem for coordinating action
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across units. So, the horizontal dimension of structure has this issue of “we can maximize
efficiency, productivity, and output within a unit or we can maximize coordination across the
various groups”. So, you need to ask yourself, “what’s the bigger problem?” Is it lack of
coordination across units or is it lack of productivity and output within units or groupings,
however you want to call that?

Again, the nature of the communication problem helps you choose which structure is better
suited to address the key problem. Now, but there are these tradeoffs, so if you get rid of all these
predefined units to maximize coordination, you’re going to be sacrificing some on the efficiency
side. Just like on the vertical side, if you increase layers in the hierarchy because there’s not
enough compliance and coordination in terms of getting things done action wise, then you’re
going to run into this problem of bottom-up information flow from problems and opportunities
identified on the first one. So you kind of have to pick your poison based on the strategy of the
organization and the nature of the communication issues on what structural change they would
want.

Jessica: Great, thank you.

Dr. Gray: It’s definitely contingency concepts here where there isn’t a best structure but rather
there is a good structure given the strategy and given the culture and the unique communication
challenges that are being encountered.

Jessica: Okay, second question: what are some effective ways to train or retrain leaders?

Dr. Gray: To be communicators? Or just leaders in general?

Jessica: Leaders in general.

Dr. Gray: And, so when I think of leaders, I want to think about--are you thinking about leaders
in the sense of how to effectively make managerial decisions about the business or having a
person who is an inspirational leader for others to follow and be the person who’s in charge in
kind of setting the tone and vision for the followers or is it the nuts and bolts of “this is how you
run a business and this is how you make a sale”

Jessica: I guess you should gives us an answer for each one.

Dr. Gray: So, training managers would be done in a very different than training for leadership.
Management is done and taught through kind of an MBA kind of concept of “you need the
technical expertise of how to organize and run a successful business”, and to do so you need to
understand operations, you need to understand finance to a certain generalist level of expertise.
And, you need to be able to understand what are the drivers of profitability, what are the drivers
of cost, what are the drivers of sales, in my particular area, and “do I have the kind of mental
model that would allow me to design a business in a way that is successful?”. That’s managerial
kind of expertise and training and it’s very much an MBA model approach. Now, you don’t have
to do an MBA. What I’m saying now is that this type of expertise across various functional
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facets in an organization is very technical in what it deems to be successful as a decision-maker

in an organization.

Leadership to me is more like a personal, relationship-building, inspiring, visionary-type set of

skills that isn’t so much about the mechanics of running a business as much as the capability of
leading a group of followers who need to be motivated, need to be informed, need to be inspired
to a particular vision. For that, I think there a few different ways of training that I’ve seen. So,
one is role-modeling in mentorship, so to the extent that leaders can get advice from and see and
hear stories from effective leaders who can tell their story. That’s a good way to do it. So,
leadership training at IBM, for example--in opposition to management training which is
different--leadership training often involves having the CEO kind of come in and give a speech
about what effective leadership means to him or her or listening to a leadership guru, so to speak,
talk about what it means to set a vision for hands-on mentorship about what it means to lead a
group of people. So, I’ve seen a lot of newly promoted executives get paired up with either a
leadership coach or a senior leader in the organization who has a lot of experience leading a large
group of people. Having that hands-on, one-to-one opportunity is a good thing.

Jessica: Okay.

Josh: Would you say there’s like a way to reconcile the two to some extent?

Dr. Gray: I would say that they actually are conflicting. So, people who first get promoted into
managers and then progress along the hierarchy of being promoted into more senior leadership
roles tend to double down on their technical skills as managers rather than reorienting their time
and their energy and their effort toward setting a vision, communicating a vision, inspiring
others. And so, what managers as they become leaders--from a first-line manager to becoming a
leader--requires kind of letting go of the hands-on technical operation and granting a degree of
autonomy to followers--trusting followers--but also kind of laying a broad vision and holding
other managers accountable but also setting and being that inspirational voice in the company.
It’s hard for many managers to transition into that less hands-on role. There are some people
skills that new managers that’ve just been promoted--let’s say from an analyst or something--
there are some people skills that those managers need apart from the technical competence of
“how do you run a business” like giving feedback, delegating. These are things you can literally
learn, best practices, online through research tutorials about kind of managing people. Those are
fairly rudimentary things that you can learn through these online resource. You can also learn
them through experience and hardship and failure and struggling to lead people, but the basic
nuts and bolts of “how do you set goals for your employees”, “how do you give feedback to your
employees”, “how do you empower your employees to do their job”, “how do you define what
tasks and responsibilities certain people should have”, those are all sort of manager 101 “how do
you manage people”, and there’s an abundance of resources out there, many of which might be
free, so those are available too.

Jessica: This kind of ties in with what I just asked, but what are some qualities of good
management or in what you just mentioned, a good leader? Just list three qualities for each.
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Dr. Gray: I think of a good manager as highly organized, consistent, and let’s see… kind of
results-focused. You could say short-term focused. You could kind of blend those two together.

I think of an effective leader as a visionary, inspiring, and long-term focused.

Jessica: So now I’ll explain our Capstone project.

Dr. Gray: Okay.

Jessica: The specific situation that we’re in is that we’re consulting for an IT firm that has a lot
of highly skilled, specialized individuals--some have PhDs from MIT--who are all very talented
in their own respective scientific and engineering arenas. However, they have difficulty
communicating with each other and for that reason, sales are down from where they used to be.
The company used to be a leader in the IT industry, and now it’s declining.

Dr. Gray: Is it very large or not-so-large?

Jessica: It has about 1,000 employees. And, they recently hired a consultant to try to fix their
problems. She came up with a lot of great solutions but in the process, lost the trust of the SVPs.
At the end of our case specifically, they fired the head of the sales and marketing department
because he was not able to cooperate or work effectively with the team anymore. The situation
that we’re in is that There’s a team of engineers who are SVPs and C-level executives of the
company who won’t communicate, there’s no sales and marketing SVP, and we’re unsure of
what to do with the consultant that they hired.

Dr. Gray: With the consultant? Oh, to advise them on strategy?

Jessica: Yeah.

Dr. Gray: Yeah, yeah, yeah. Okay, do you want me to just offer some initial thoughts?

Jessica: Yeah.

Dr. Gray: Or do you have any specific questions?

Jessica: Some initial thoughts would be great.

Dr. Gray: Yeah, I mean, I think, so I have a consulting background, so it does help to know these
issues kind of firsthand from my experience. It was at a very large firm, but it was tech-driven
consulting, and one of the challenges of consulting business is that you have typically partners.
It’s odd that there’s a sales and marketing group. That’s not--in my view--not traditional for
consulting. Typically, the partners are the sales and marketing group. So you can have marketing
ads, efforts, and initiatives; that’s separate from typically how the value chain works in a
consulting business in which the partners are really the ones responsible for all sales. I assume
that’s the case of this startup.
 18

Jessica: The sales and marketing department is in the IT company.

Dr. Gray: Yeah.

Jessica: And their head just got fired.

Dr. Gray: Yeah. so this IT company is IT consulting, right?

Jessica. No, they provide software.

Dr. Gray: Oh…

Josh: Yeah, they’re like website-builders.

Dr. Gray: Where did I get consultant from?

Jessica: They hired a consultant before us and we’re consulting for them to try to fix their
problems. That first consultant thought of some ideas.

Dr. Gray: So they’re purely product based?

Josh: Yes.

Dr. Gray: They sell software to clients. Is it licensing, is it software as a service? What’s their
model?

Josh: I think it’s platform as a service.

Dr. Gray: It’s okay; it’s not that big of a difference. Now I get it. I was like, “This is not the way
that IT consulting operate.” Okay, so you have product people. The employees are product
people, developers, engineers.

Jessica: Yeah. They’re software developers.

Dr Gray: Because I was imagining these as IT consultants.

Josh: Oh, no.

Dr. Gray: Now I’m starting to see this a little more clearly. So you have sales and marketing
wrap around either end of the value chain. I’m not a strategy person, so this is sensemaking for
myself about what this is. You have the marketing people identifying needs, customer needs,
feeding it into product people who are designing new versions of what will be built. Then you
have the sales people. Then you have the product people building, designing, and then you have
testing. Eventually, you have a product launch. Then you have the sales people selling that
product that has been launched. That’s interesting, marketing and sales are on either side of the
value chain. Then you have product development, then you have kind of testing, and that kind of
 19

wrapped into the product development process. And so, you have a disconnect between the Sales
and Marketing organization and the Product Development group.

Josh: Between all the C-level executives.

Dr. Gray: And certainly departmental breaks.

Jessica: There is definitely more variation and breakage between each of the C-level executives.

Dr. Gray: Yeah, okay. Would you say the problem is also at the bottom? Or is it mainly conflict
among the very top?

Josh: I think a lot of it was you were talking about the top to bottom flow, but I don’t think that’s
really happening because at the top, the CEO only takes meetings with one SVP, makes up his
mind for whatever they’re talking about, then has another meeting with another SVP and
changes his mind and reverts his decision. So it’s like a problem that the different SVPs aren’t
really communicating with each other too.

Dr. Gray: Okay. So, who’s on the board? Is it just the CEO?

Jessica: Right now, the CEO is the President and the CEO and below him are five SVPs, each of
which have different goals for the company and different ideas. Each of which also meets with
the CEO one-one-one, and they all think that they’re correct in their ways and vision.

Dr. Gray: This is somewhat unusual, I have to say, that the CEO manages through what I would
call a dyadic process of interacting piecemeal with each individual. The chart is normal. What is
unusual is the method of making strategic decisions in which the CEO meets individually with
each SVP and kind of in a one-off piecemeal way is making calls and then reversing calls. The
ideal scenario, and this is very conventional leadership, is that there is a top committee, a top
management committee or management group has semi-regular, maybe biweekly or monthly, at
the minimum, meetings where everyone gets together and everyone is in the room brainstorming.
And, problems that one person raises or solutions that one person raises might spring a leak over
here, but there in the room to identify that at the collective organizational level. This is very
unusual, and it’s-- there’s got to be a reason. What is the reason?

Jessica: Personally, we just think it’s the personality of the CEO.

Dr. Gray: This CEO… This would be like a strategy of a CEO that wants to be very controlling
and who is afraid of their authority being undermined.

Jessica: Yeah, that is the vibe that we get from this guy. We were thinking about how to solve
this and we all thought “we should just get a new CEO”, but we can’t tell that to the CEO that
we’re consulting for.

Dr. Gray: What I would do is research “what are common tactics for strategic decision making
among amongst top management teams”. So again, I’m not a strategy person per se, but you can
 20

look up a bunch of stuff on top management teams and governance structures and decision
making styles. This is very unconventional from the standard. I can’t fully articulate what the
standard looks like but go to a respected, similar IT, software firm and you can get a glimpse of
what is there structure for the top management team. Not just structure on the organizational side
but committee wise and how do they meet to talk about things and how are decisions made. Try
to do research on that. There are people in our department that I could point you to about top
management decision-making mechanisms and processes ie a best practice is to meet once a
month and have all SVPs in the room to have a consensus-oriented decision making style or to
have a consensus with a voting option. You know, if we’re going to make decisions that way.

Josh: And that’s kind of the decision that we’ve come to. My concern is how do you get
someone like this CEO who’s so entrenched in their ways, how do you get them to adjust to
these new expectations?

Dr. Gray: The board. If this gets to the board... First of all, I’m surprised that the board has not
done anything given that this is very unconventional and is causing some problems. And it’s
partly, I’m not surprised, because the CEO is also the president of the board. This kind of thing
happens when the CEO controls the board. There’s a reason why president and CEO has
potential problems when occupying both roles. But typically if you give this report to the board
those are people who are less under direct authority of the CEO whereas the SVPs are directly
responsible to the CEO, but the board would be the ones that say “hey, this is very
unconventional, this is not best practice, and these are some issues that emanate from this
approach to making decisions, this approach to managing the top management team.

Jessica: So when you say “the board”, who would this be comprised of? Would we be promoting
people to this position or just using the current SVPs? How would we get this group of people?

Dr. Gray: If this is a.. You should know who the board is; that’s generally public information. If
you don’t have access to it… Is this a fictitious company?

Jessica: Yes.

Dr. Gray: Just say, “the board of directors” in that case. Fill in the blank. In a real organization,
you would know who’s on the board; it’s on their website. You would meet with the board for
these strategic level decisions. This would be commissioned. Your project would be
commissioned by the board and therefore you’d be presenting your information to the board.
You don’t need to analyze the board of directors to do this consulting project, but as part of your
recommendations, you need to get the CEO to change. The CEO is accountable to shareholders
and the board is the advocate of shareholders: the living embodiment of shareholders. So, by
presenting these facts to the board, that is all you can do so to speak. The board can fire the CEO.

That’s trickier when the president of the board is the CEO, so that’s kind of another element in
your case. It’s definitely not unusual to having a president and CEO. There are some advantages,
but this is why it does not always happen. This is exactly the problem that arises also when you
have it in this way. And so you can talk about stripping the role--a very big deal. That is a
solution option but it sounds like that is the nuclear option so to speak. You might not want to
 21

recommend that if the CEO is on the board and the president. Giving this to the board should be
the most that you can do, in a reasonable sense, as consultants.

Consultants are basically supposed to be an outside voice who’s more objective than inside
voices, and ultimately because of your outsider power, you don’t have a lot of formal power or
authority. All you can do unfortunately is kind of just say, “here’s what we found. These are best
practices. This is what the best software companies are doing, and there’s a reason why they do it
this way. In this company it’s done a different way, and these are the problems that are emerging
from that. And so, one thing that can be done is try to selectively adopt some of these practices.
These are the ones that we see as most central to resolving the issues around indecisiveness,
inconsistency, and kind of coordination across these groups.

So you have major coordination problems going on when you have each... This is very much an
integrated business model. This is not a conglomerate where product one, product two, product
three or geo 1, geography 2, geography 3. This is an integrated value chain type of a business, a
functionally designed business structure, organizational structure, and that requires integration,
because you cannot create value or sell things without having all the pieces of the value chain
working in harmony and synchrony with each other. And that requires mechanisms like a
committee meeting every two weeks or once a month to highlight breakdowns in the value-
creation process across different domains. It also elevates the conversation from operations again
or product development again breaking down to “we are an organization, a single organization,
trying to create value for our customers, and yes there are surface-level breakdowns in these
functions, but we need a collective response for this to work holistically better together across
from start to end”. So, these mechanisms of committees or meetings that happen on a regular
basis would be literally the starting point, fairly low-hanging fruit. But you have not just to
institute this thing, but you have to deal with the cultural side of “we are now going to make
decisions in a very different way; how are we going to do this, and what are some effective ways
to move to a more collaborative, consensus driven decision making style?” Again, look to best
practices from other software firms or other top management teams for what is an effective
process. How do we go from a more autocratic, top-down, CEO makes all the decisions to a
more collaborative, inclusive, decision-making style?

So, I hope that’s… I know it’s a fairly high-level response, generic, type of abstract type thing,
but those are where I would start. The decision-making process needs to change. There’s needs
to be structures to facilitate the more collective decision-making process, and the board needs to
be on their game in terms of holding the CEO accountable for running the organization in the
right way instead of this very much CEO-driven way.

This is a classic… I don’t know if the CEO is the founder or not, but this is a classic case of what
happens in startups when the founder builds this large organization relatively quickly and has
always had this very top-down. “I make all the decisions” approach, and it eventually collapses.
It’s unsustainable as the organization grows to a certain point, so you oftentimes will see VCs
and investors kick out the founder. That is the solution that VCs have to this problem. Now, that
may not be a viable solution in your case, but what happens is founders grow to a point and then
they become a major liability. VCs have gradually more power, voting rights on the board, and
those types of things to the point where they can kick out the autocratic style of running the
 22

organization. So this is the point where the organization is at a size where this style of decision-
making and leadership isn’t sustainable or viable. Greiner is a person you should look at. G-R-E-
I-N-E-R. It’s a model of organizational life cycle or organizational growth and it highlights how
when organizations hit a certain size of maturity or size or development, they go through this
crisis moment where the things that they used to do no longer work, and the style of decision-
making in the past afforded speed and consistency. When you get to a certain point in the
lifestyle of an organization, it no longer works and you have to find a new way of doing things. It
kind of seems like they’re at that critical moment where they have to change how they make
decisions and manage the organization.

Jessica: Great! Thank you so much; this was very helpful.

Dr. Gray: Yeah, no problem. It’s a tough case, but it sounds like a common one as well. I think
you can find some good examples out there. Do some best practices research. Try to find what
are organizations that fixed this problem well. There’s got to be something out there that you can
cite.

Josh: I think one of our group members had actually found the case, the real case, that this one is
based off of. It’s like some spanish IT company and they just kind of changed basically
everything, but it’s definitely like the same I think around the same ideas.

Dr. Gray: I wouldn’t… So you know this is the formal structure. Organizations have what’s
called semi-formal structures. These are committees, these are collections of individuals selected
in part because of their formal role, but brought together on a temporary, sporadic basis to make
strategic decisions and those types of things. It’s not just about rearranging this chart; it’s about
creating these semi-formal committees and strategic committees that come together and then
rewiring the culture as well to be more open and inclusive and collaborative in the style in which
decisions are made. So I honestly, hearing the problem, there might be some formal, structural
changes that you make to the organization chart, in particular, president, CEO--that’s a problem.
But again, there are some downsides to stripping a role. It’s one thing if you’re just designing it
from a blank slate. It’s another thing if you’re taking something away, because what’s that going
to signal to everyone else in the company.

Josh: Yeah, one of the ideas we had come up with--and we all seem to be on the same page with
this--is like adding a liaison between these different ones and they’re more focused on long-term
vision and goals for the company.

Dr. Gray: So yeah, I would not necessarily appoint liaisons. My strategy would be to have a
separate committee. You can have a long-range committee. You want all of these people to start
building a better relationship. You can compartmentalize operational challenges in the present by
having a committee that meets once every two weeks or month that does this kind of putting out
the fires type strategy stuff, and that needs to be these people for sure. Then you have a quarterly
long-range committee which includes these people, maybe some people from the board, maybe a
couple other people from the organization, but these people have to be a part of that too, and it’s
just a separate committee with a different objective aiming longer term. I would make these the
same people. The relationships among the president and these people are the key focal area.
 23

They might have different objectives of operational fixes, long-term strategy, but they all need to
be doing that together to get that working relationship.
 24

Appendix B: Interview with Jan Brusevold

Jan Brusevold earned his Bachelor’s of Business Administration in Management Information

Systems and Finance in 1999 and his Master’s of Business Administration in 2009 from The
University of Texas at Austin. He has worked at Sense Corp in Austin, Texas since 2016. In
recent years, he has focused on managing the business and operations of digital technology
efforts in areas including direct management of resources, program definition, and operational
efficiency. He has also worked closely with editorial teams to create content for digital
marketing campaigns.

Jessica: Some technological firms are lead by engineers who are highly educated and talented in
their specialized role and industry. Sometimes these engineers can be stubborn and stuck in their
ways. How would you describe the best practices amongst firms in this situation?

Jan: My best practices, because I do work with highly technical people, are to ensure 1) that
there’s alignment in what the goals are, 2) there’s alignment on what the timeline for what plans
are, and then 3) that there’s open communication about the tasks necessary to get you to the
finish line. So even if somebody’s super smart and super driven and super technical, they can tell
you, “hey this is what it takes for me to do this” and me as the project leader and program
manager has the ability to take that information, put it down in writing, and allow us to
understand how working together with them will get us to our goals.

Jessica: Great.

Jan: Does that make sense?

Jessica: Yes.

Jan: Did I go around in a circle there?

Jessica: Not at all. How would you consider retraining people who are stuck in their ways and
unwilling to compromise in a company that still requires their expertise?

Jan: Yeah, so with high performers, that’s often hard. A lot of… if you take… I have found that
if you take an adversarial approach with them, it doesn’t work, especially with your really good
people, because they’ll just leave and they’ll go work somewhere else. If they’re that good,
they’re skills are going to be in need, so usually it’s about communicating through it:
understanding what you need from them and why you need it. Like “I need to know when your
project deadlines are or when your pieces are going to be finished”, so that I can set up the right
meetings with our clients to show them all the cool things we’ve accomplished or I can set up all
the right discovery sessions for people on their side of the IT team, so that we can ask them
questions. So for me to be able to do that for them--because they don’t want to do that, they want
to worry about all of their own work--I need to understand what the timelines and the deadlines
and the goals are so we’re completely in alignment. So communicating that to these folks and
 25

keeping those lines of communication overly open allows me to help shape their behavior to be
more beneficial to the company or the project or whatever it is that we’re working on.

Jessica: Are there any managerial structures that you would suggest for minimizing these types
of problems?

Jan: Structures? I’m not too formal on specific structures. I think, for me, it always depends on
the people. Different people work in different ways. I have a team right now where the functional
side, they’re very good at understanding that there is a goal and working to that goal where on
the technical side, they’re more focused on little details. So we have to make sure that they see
the big picture and how they’re working on the details. So I don’t know if those are managerial
structures, but as far as managing the team, those are things that I think are important. Does that
help?

Jessica: Yeah! For my specific case, my group is consulting a fictitious IT company called
Celeritas. The CEO and president has noticed that they used to be a leader in their industry, but
now their sales are declining. He believes that a lot of the problems are because of difficulties
between the SVPs. There are five of them and they also make up the C-Suite. They’re all very
highly-skilled people--some of them have PhDs from MIT or other very noteworthy
universities--and each of them kind of has a different vision for the company and different goals.

However, below them, they’re pretty good at ensuring that everyone underneath them works
towards the goals that they give. It’s just that the goals that they give them are conflicting with
each other. They have a lot of difficulty communicating with each other.

They’ve done lots of team bonding analysis and things like that, and they even hired another
consultant to fix their problems. She had a lot of great ideas, but I think she tried to move too
quickly and now they don’t trust her anymore.

Recently they also just fired the head of sales and marketing of this company. So, what they want
to do is to continue to provide platforms and software as a service while maintaining some level
of cohesion within their firm.

Jan: So, what’s the question? What’s should they do? Or, who should do it?

Jessica: Kind of both. The first question that my group is trying to answer is if there are any
positional changes that we should make in this company? Because sometimes, it also seems like
the CEO and president is too authoritative over everything given that he’ll give different orders
for different people and he’ll kind of go back and forth between the SVPs. It’s partially also a
problem of the SVPs not communicating with each other. So, we were wondering, were there
any structural changes to make? Who should replace the SVP? That’s the first line of business.
The second question would be like, “what do we do with this other consultant given that she still
seems to have a lot of expertise and good ideas?” It just seems like nobody trusts her anymore.

Jan: It sounds like… if you have a president, one who should be charge of the day-to-day right?
That is a role that probably should be authoritative, but you have to, you must, have the right
 26

president. The goal would be to… I think my first goal of all things would be for all those SVPs
and the president, they should all have the same target of what the company’s goals are.
Alignment with those goals and ensuring that everybody and everything they’re doing relates to
those specific goals. So I think that would be “A” number one.

Get your person, your consultant who’s interviewing all of these people, to make sure that there
is alignment among everybody for what they’re doing. That is “A” number one task, and how
you do that--there’s a million ways to do that--but you sit everyone in the room for a weekend
and force them to come up with “these are the company’s goals and priorities” and not talk about
the tactical decisions of what sales is going to do, what marketing is going to do, but just talk
about “this is where the company is headed” and that is the job of the president and CEO to
ensure that the vision, the strategic vision of the company, is aligned.

So, you start there and you even mentioned that each of the SVPs is probably very good at
getting their own team aligned. That needs to happen. If that’s the case then getting all of
leadership aligned is “A” number and it should all flow down from there. Now it also sounds
like, you mentioned that the president gives conflicting instructions to different groups?

Jessica: Yeah.

Jan: That is a major problem.

Jessica: He has a practice of meeting one-on-one with each of the SVPs and telling them what to
do. They can typically come to an agreement in these meetings, but the problem is that either…
the case made it unclear as to whether the president was just trying to cater towards the SVPs’
goals or if he simply could not make up his own mind.

Jan: Yeah, well. Then that’s… Maybe they need to replace the president. I don’t know. The
president should be able to deliver instructions that all fit a common set of themes of what the
goals of company are. If they can’t, then nobody should be expected to follow those same themes
in order to provide their service. That happens more than you think, so this is a very realistic
case. But I would focus on that. The alignment from the highest managerial levels is what is
going to align everybody from below them. Does that help?

Jessica: Yeah! A position that we were considering was, at the very least, having bimonthly
meetings between the entire board and the president where they talk about their progress and
near-future goals. Would you suggest that as an option?
Jan: I don’t think… Well it depends on who that audience is. Are you talking about the day-to-
day managerial staff or are you talking about the C-suite?

Jessica: We were talking about the C-suite and then some of the most high-level people
underneath them.

Jan: So, the C-suite, first, should be more focused on long-term goals. They should be worried
about the long-term goals. Depending on the size of the company, they may have more
involvement in the day-to-day. Like at Sense Corp, our CEO isn’t worried about what my project
 27

is doing from day-to-day at all, but he is worried about the portfolio of projects that he’s doing
for the company and where the company is going to be in three to six months.

So, it’s great if you have those meetings on a more often basis. In fact, they should meet once a
month, but the goals of those shouldn’t be to talk about the near-term tactical items. The goals of
those should be to ensure that they are progressing against their long-term strategy and that
they’re… everything they’re doing is in line with their long-term strategy. That’s what I would
think. So, I don’t know, it all depends on the case, but my thinking would be that for the C-suite,
it’s great for them to talk about what they’re doing everyday, but that’s a minor part of their job.
Their job is “what’s the long-term strategy?”, “are our goals still in-line?”, “is everything we’re
doing aligned with the goals that we have for our long-term strategy for the company?”

Jessica: Would you suggest that there be a correspondence committee that kind of ensures that
what the C-suite tells them is similar to what the president is telling them or some form of
correspondence between the two?

Jan: So, the C-suite, I’m assuming that that meeting includes the president. His job should be to
push forward whatever agenda he’s pushing out for the company, right. It depends on how
they’re departmentalized, but probably the president’s job is to enforce all the day-to-day, all the
rules that the C-suite is setting. So, as far as correspondence, there should be review of the
decisions that came up, but it’s not like… but he reports to them not the other way around.

Jessica: Would Sense Corp get a project similar to this ever, or is your job more about supporting
the product side?

Jan: We might, no, so we do all kinds. We might, for this is a strategy… Sense Corp does these,
Mackenzie, Bain, that kind of problem where you have to understand the organization and then
you have to tell the organization what they should to do move forward. So yes, we do work like
that.

Jessica: So, how long would you typically say a project like this would take?

Jan: Well it depends on the size of the company.

Jessica: It’s about one thousand employees.

Jan: Oh. Yeah, that would be… It would take a while. It will take several months to talk to all the
right people and to come up with a strategy for how they should move forward. Now, it depends
on what you’re doing. If you’re coming up with a strategy for the organization it’s one thing, if
you’re coming up with a strategy for how they should interact that’s a totally different thing.

Jessica: If you were to consider how the C-suite should interact, what would you say for this
specific example?

Jan: How… how… like how that C-suite should interact?

 28

Jessica: Yeah or how should they reformulate their method of making decisions?

Jan: Oh probably what we talked about earlier. So they should make sure… I don’t care if
they’re going to meet once a month or once a quarter, but make sure that they’re focused on the
long-term strategic needs of the company and not the day-to-day tasks. Those strategic needs
need to be outlined and prioritized, and that list needs to be getting to the president. And then it’s
his job to making sure people are meeting those goals. That’s what I would say.

Jessica: So regarding their lack of a head sales and marketing, would you suggest them looking
outward and trying to hire someone who’s really qualified or looking inward and trying to
promote somebody?

Jan: I couldn’t tell you. You never know. That depends on the company itself. If it’s a super
specialized product, then often times it’s best to hire someone from within. But if it’s a more
general product, it’s best to just hire someone who knows how to sell. And it also depends on
what their growth goals are like what industries they’re expecting to grow into, what they’re
trying to do, what kind of sales they’re trying to make work. That’s a… if your question wants
you to answer that, you couldn’t tell them because there’s a million different answers.

Jessica: I guess… we were just considering how finding someone from outside might kind of be
disorienting for the other people who are also at their same level.

Jan: Yeah, but sometimes disorienting is good. Sometimes you need to shake it up a little bit.

Jessica: Okay, I can understand that. Regarding the other consultant they hired before coming to
us, would you suggest… normally if this were your company in this position, would you work
with the other consultant or would you just take the reins and say “we can just take it from here.”

Jan: That person would have a lot of knowledge, right? So maybe you don’t want that person
calling the shots, but using that person’s knowledge of what they’ve heard and they know, taken
with a grain of salt. I’d want them around, but I wouldn’t want them in charge. That’s another
information resource that would help your consulting efforts. She can tell you everything she
tried that didn’t work. But ultimately, they’re going to pay her and they’re going to pay you, so
it’s up to them if they want to do that.

Jessica: Cool.

Jan: Cool. Does that help?

Jessica: Definitely. Thank you very much for your time.