CASE STUDY

STMicroelectronics

I. Background
STMicroelectronics is one of the world’s largest semiconductor companies around the
globe. Offering one of the industry’s broadest product portfolios, STMicroelectronics serves
customers across the spectrum of electronics applications with innovative semiconductor
solutions by leveraging its vast array of technologies, design expertise, and combination of
intellectual property portfolio, strategic partnerships and manufacturing strength. The company’s
world-class products and technologies serve to deliver compelling multimedia experiences to
consumers anytime, anywhere – in the home, in the car, and on the go. They provide all aspects
of data security and protection by enabling various types of applications that cater to their local
and international market.
Despite its strong partnership with different organizations, STMicroelectronics is not
exempted from organizational problems that even major companies experience in one way or
another. Most of the employees complain about the leadership style of the top management; all
the employees can agree that management is directive and dictatorial. This issue has resulted to
a major protest on the side of the workers. The management has blind sighted by the artificial
growth of their organization that they have failed to consider the feedback of their external and
internal stakeholders.

II. Statement of the Problem

a. STMicroelectronics should employ the democratic leadership that involves the
employees in decision making and it can build team work that will quickly form the basis
for stronger professional (and personal) relationships. This can encourage the
employees in team involvement, engagement and participation and they are motivated
to generate and offer up creative solutions, and it produces an atmosphere of
cooperation and team spirit.
b. The type of total quality tool/continuous improvement method should
STMicroelectronics employ is the Pareto Charts. This suggests that the managers must
concentrate on the twenty percent of the factors in order to eliminate the eighty
 percent of the organizational problems. This will help to gain insights of their internal
and external stakeholders.
c. ISO 9000 can help STMicroelectronics organization performance by bringing huge
benefits to their company. It can improve their customer service and business
relationships and it will help the company retain quality employees in the long term.

III. Areas of Consideration

Most of the employees complain about the leadership style of the top management; all the
employees can agree that the management is directive and dictatorial. Leaders, particularly the
supervisors, are not open to suggestions that will help improve the operations of the business.
They only provide orders and expect that the factory workers will comply obediently to their
commands. This issue has resulted to a major protest on the side of the workers.

IV. Alternative Courses of Action

 Alternative course of action 1 - STMicroelectronics could have taken the opportunity to
include the employees in the decision making process. By getting the input of his
employees. STMicroelectronics may have discovered alternatives to align the individual
business strategies of the employees. By group decision making or consulting all the
employees, they would have the advantage of a diversity of problem-solving styles or
different ways of looking at a problem.
 Alternative course of action 2 – STMicroelectronics could have chosen Pareto Chart as a
total quality tool that helps them to identify the most frequent defects, complaints, or any
other factor that can be counted and categorized.
 Alternative course of action 3 - ISO 9000 can help STMicroelectronics to increase the
quality of their products and services. This can improve internal communication, improve
customer relationships, provide financial benefits for stakeholders, improve processes, and
enhance supplier relationships.
 Advantages and Disadvantages for each Alternative Courses of Action

Alternative Course of Action 1

The advantages of democratic leadership are STMicroelectronics creates a form of shared

leadership where each team member is invited to share their knowledge, experience, or opinion
about a project or situation. In this way, employees of STMicroelectronics can help to solve it
with the best possible solution and when they feel like their experiences matter, and then it gives
them more personal satisfaction over the work being done.

The disadvantages are it can cause disharmony if it is misapplied, some leaders of

STMicroelectronics may choose the opinions of one person over the rest of the team on a
consistent basis, often for valid reasons. When that occurs, the other team members may feel
like their experiences or opinions don’t matter, so they stop sharing them. Over time, this
disharmony can cause some people to feel under-valued, so it reduces their productivity.
STMicroelectronics can even allow the majority to make the decision on their behalf, which
further increases the chances that an incorrect decision would be made.

Alternative Course of Action 2

The advantages of using Pareto Chart it simply help STMicroelectronics to identify and
determine main cause, root causes of defects or problems. It also helps and provides a better
explanation regarding defects that are needed to resolved first. One can also decide and plan
about correct and important measures or actions that are needed to be taken regarding defect
and it helps to improve the skills of individuals in better ways like problem-solving skills, decision-
making skills.

The disadvantages is that root cause analysis cannot be done by itself in Pareto analysis.
There is a requirement of tool, root cause analysis tool for determining or identify root causes or
major causes of defect. STMicroelectronics might be only focuses on past data where damaged
and has already happened. It cannot be applied to all cases. It is limited to some cases only.
 Alternative Course of Action 3

The advantages of ISO 9000 it helps STMicroelectronics to be organized and this leads to
further improvements on their company. It makes them aware of what they have to do to
maintain their standards. STMicroelectronics involved more people they became a team player
type because everyone will going for the same objective this can lead to gain the insights of their
internal and external stakeholders.

The disadvantages is that STMicroelectronics may not have an adequate understanding of

the ISO 9000 certification process or of the quality standards, it reduces the productivity by
forcing unnecessary actions. It can affect the employee’s creativeness and less innovative in
doing their job because there are predetermined procedures they have to follow. It requires
STMicroelectronics to have many meetings and much documentation, they can be frustrated
with the time consuming element.

V. Recommendation

Given the various alternatives and after evaluating their percentages for certainty of
occurrence, it seems most beneficial and realistic to suggest the implementation of
brainstorming among their members. STMicroelectronics should make the employees involved in
the decision-making since they are the ones who are directly exposed in the different processes
of the organization and they should also plan to establish a more conductive work environment
that promotes employee involvement and empowerment after soliciting insights for
improvement from their internal and external stakeholders.

VI. Management Lesson Learned

The management should not left behind their employees when it comes to decision-making
process, by having their concerns heard; they feel more valued and integrated into an
organization. STMicroelectronics should invites higher levels of commitment, this can foster
positive and healthy company cultures and builds team relationships. In this way a strong and
clear vision for the future is built.