Mary Kay Cosmetics

Notes:
- Beauty products firm founded in Dallas, 1963
- Merchandise marketed under ‘Mary Kay’ and ‘Mr. K’
- Competitors’ differentiators:
o Target markets  high fashion – high price vs everyday use – moderate
price
o Features  Skin care vs pure cosmetics
o Distribution  Retail vs direct to customer
- Sold products exclusively through representatives direct to customers
- Consultants income  the difference between retail and the price at which they
purchased from the company.
- MSRP existed, but consultant was free to sell at whatever price though appropriate
Questions:
1. What are major cultural characteristics of Mary Kay Cosmetics?
- Sales reps being called as beauty consultants, were independent business people.
- No ‘salary’ system, as the consultants were not MK’s employees
- Empower women to take a new step in their life
- Believe in consumer service-oriented marketing system
- Products with the finest quality and performance in consistence with scientific basic
of skin care

2. How Mary Kay Cosmetics manages its organizational culture?

- Highly competitive monetary and motivational compensation system
- Giving sufficient amount of training to the recruited consultants

3. What are the potential risks of implementing “professional management”? How

would you address them?
- They might lose their organization culture which initially focusing on empowering
women.
- On the other hand, implementing a ‘professional’ management system will enable
the business to thrive more.
Organizational Change Case
Notes:

Questions:
1. What are the differences between “resource rigidity” and “routine rigidity”? How
about similarities?
Resource  The failure to change resource investment patterns
Routine  Failure to change organizational processes that use those resources or
the inability to change the organization’s formal processes and informal cultural
norms.

2. Why “routine rigidity” is more difficult to overcome?

3. How do you evaluate author’s recommendations? Do you agree or disagree? Why?