FMB&T: CASE ANALYSIS REPORT

Submitted by : Submitted to : Subject Date : : PORFERIO A. SALIDAGA, JR. Dr. George Fong Management Dynamics April 25, 2012

Problem Lack of clear statement of the responsibilities and authority of the Executive Vice President and Chief Information of the Company, and the absence of coordination between information technology and the other business units. Objective To define a clear statement of the responsibilities and authority of the Executive Vice President and Chief Information of the Company, and to establish proper coordination between the information technology and other business unit of the bank. Analysis of Relative Facts Among the strengths of FMB&T, a growing regional commercial and retail bank and traditional vertical organization, are its increasingly competitive business. It recognizes how important information technology is for its efficient operation, and how to focus more effectively on customer needs. Its Executive Vice President and Chief Information, Ayishia Coles is a bright, hardworking, and self-confident woman. The IT people under her want that before taking on a problem, they can thoroughly understand all of its dimensions so that the solution would fit seamlessly into the existing system. They also want to identify opportunities for dazzling new developments to contribute to business strategies. Information Technology is very important in todays organization because it provides relevant information to managers in a timely and cost-efficient manner. Moreover, an employee who really takes time to know all the dimensions of his work in solving job problems are more productive and efficient as compared to those who

just work mechanically, and are just focus on his own work and not aware of the connection of his work to the organizational goal. However, FMB&T has, for its weaknesses, no clear statement of Ms. Coles responsibilities and authority, causing the latter frustration. The relationship between information technology and the banks other business units is muddled, often causing considerable confusion, friction, and inefficiency. There is an absence of a person or unit which is supposed to be getting all the business units of the company together and coordinating request. Coordination is very important in an organization to prevent overlapping of functions and to pinpoint accountabilities. When Coles tries to step into the breach and act as a facilitator, unit managers usually do not welcome her efforts. This reaction by the managers undermines the power or authority of Ms. Coles being the Executive Vice President of the company. If remained unresolved, it may result to side-tracking of office protocols and creation of communication gaps between the supervisors and their subordinates, and between the supervisors themselves. In fact, the campaign of the president of a large regional branch to decentralize the IT departments in each large branch may be a manifestation of such problem. The IT staff, moreover, increasingly feels to be underused as it found itself limited to applications work and are not given the opportunity to contribute to business strategies. It is clear that these employees want to be empowered, hence, this feeling of being underused could lower their morale. Alternatives

1. To retain traditional vertical structure of the company.

Advantage: Information flows down the hierarchy directly from the top management to the rank and file, hence there will be no much time is taken for planning at the lower level of the organization. There will also be less work deviations as the workers will only follow instructions coming directly from a vertical line. They are not bound to follow instructions from other departments. Disadvantage: Employees are not given the opportunity to make decisions, they merely do their jobs based on the specifications provided by the top management which may lead to the demoralization of those who want to be empowered and be involved in decision-making.

2. To change the company structure from being traditional vertical to horizontal structures using the team approaches.
Advantage: The horizontal structure breaks down barriers between departments and improves coordination and cooperation. Decisions need not

follow a hierarchy for its approval, hence the employees can be more involved or empowered in the process of decision making. As shown by facts the IT employees of FMB&T have been wanting to be given the opportunity to contribute to business strategies. Moreover, through this structure, the responsibilities and authority Ms. Coles being Executive Vice President and Chief Information Executive Vice President and Chief Information can now be clearly defined. Also, the coordination between the business units and IT would improve as the question on who should be getting all the business units of the company together and coordinating request be now clearly identified. The IT people will now know from whom they should receive request and talk to in case of IT advisories. There will be now proper channelling of communication. Disadvantages: With every employee being involved in decision-making, too much time will be consumed in planning that may affect the productivity of the rank and file.

Solution Alternative 2 is recommended. Although there are disadvantages in this alternative, but such are immaterial as compared to the advantages, as enumerated above, they may bring to the company.