(1) Echo Electronics was founded in 1994 and provides electronic repair services from its base in Sydney, Australia. It has a hierarchical organizational structure. (2) An engineering manager proposed installing new computerized workstations to increase productivity, which the production manager and CEO approved. However, after 3 months productivity and quality had decreased, and customers complained of defects. (3) After meeting with supervisors, the production manager learned the problems were poor workstation design that was hard to understand, a lack of training on the new systems, and insufficient financial incentives for taking on more work. Two supervisors subsequently resigned.

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MASTER IN BUSINESS ADMINISTRATION
KPA1313 STRATEGIC LEADERSHIP
CHAPTER 5: A CASE STUDY OF ECHO ELECTRONICS
PREPARED BY:
ATEERA BT AHMAD DAHALAN (KBB16011)
ESTHER MINGEL (KBA15026)
PREPARED FOR:
PROF. DATO’ YUSERRIE BIN ZAINUDDIN

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1. CASE BACKGROUND
Echo Electronic was founded in 1994 and it is located at Sydney, Australia. The
business expanding quite dramatically over the years of business, and they have technical
staffs with 25 years experiences restoring electronic goods back to their full potential. The
main portfolio of the company is as the authorized service centre for electronic corporations
such as Hissense, TCL, and Changhong. The connection Echo Electronic has with these well
– known brand is a proof itself that the company provided and focusing on high standard
quality services to all electronic equipment. The main service provided by Echo Electronic
includes Service and Repairs, Installation and Setup, Residential and Commercial, Technical
Support & Advice,Maintenance, Electronic Spare Parts Sale, Parts & Accessories Purchasing
Agent. The main goal of this company is to continue serving their existing partners and
seeking new opportunities to bring the business to a higher level in the industry. In Echo
Electronic, it has a hierarchy organizational structure. The hierarchy organizational
structure usually will have the below setting;
There will be a group of power at the top and then spread to the subsequent below levels.
Every level will different of power or authority; where the top will be the Chief Executive
Officer ofthe organization andsubsequently arethe departmental managers. The main tasks
for any managers are to organize every departmental activity or activities that will meet the

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objective or goal of the organization. As we are aware of, the business environments are in a
constant state of change. Therefore, an organization’s strategy must be adapted to changes
in its competitive environment. Hence, the organization structure must follows the strategy
of the organization that is the strategic change for example the needs for restructuring the
organization to acquire new and different knowledge, skills and abilities.
Next, every department will have their own organization’s chart that mentioned the
title ofeach employeeandwho is accountableto whomand their responsibility foreacharea.
As we know, in a tall organization it will have more management layers and hierarchical
control. In addition, a wide span of control; where there will be number of subordinates
reporting to a supervisor. In terms of types of power being displayed in Echo Electronic,
definitely the CEO hasthe legitimate powerdue to his position in the formal hierarchy. In the
manager’s perspective as per this case study, a manager must possessed the following traits
which are, basically he or she already has the assigned position within the formal
organization, is expected to carry out specific functions, duties and responsibilities,
emphasize on control, decision making, decision analysis and results, manage the resources
efficiently including financial, employee’s needs and environment, is held accountable for
departmental responsibility. However, if he or she has the traits of a leader, he or she will
influence the team and not just giving the task, have a wider variety of roles than managers
which includes focusing on group process, information gathering, feedback, empowering,
and emphasize on the interpersonal relationships.
The principles of delegation also states that there are seven principles of delegation
that is; the managermust clarify the assignment, know what to delegatethat is in which areas
to cover, specify the subordinate’s range of discretion and make the person accountable for
results.

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From above organizational chart, in Echo Electronic it has a functional departmentalization,
where each stated department has their own function; namely engineering and design, and
production. The benefits of having functional organization are it is simple to manage, it
fosters efficiency, it can simplify executive hiring, training, and it can help facilitate the top
manager’s control.
As per the case study, Engineering Manager had proposed to install new
computerized workstationsin orderto increasethe productivity ofaplant. Asthe Production
Manager, Paul agrees since it seem like a good idea. Next, the CEO approved the plan and the
new equipment was installed. The results were being observed for three months.
However, instead of increasing, the productivity and the quality of the output had
decreased and deteriorated. In addition to this, they also received many complaints on the
defect products.Subsequentto what happened,Paul held a meeting with all foursupervisors
to discuss on the problems and the solutions to be taken. To his surprise, the supervisors
-Team leader to supervise
the workers in production
lines.
-Team leader to supervise
the engineers.
-Manages the engineering
and design team.
-Manages the production
team.
Approvesplan,budget
raisedbydepartmental
manager.
CEO of Echo
Electronic
Production
Manager
(Paul)
supervisor
1, 2
supervisor
3, 4
Engineering
Manager
supervisor

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provided such reasons that lead to the problems namely, poor design by the engineering
team thus they cannot understand how it supposed to help them to work better, there was
not a single training being conducted to familiarize with the new workstation and lack of
monetary motivation such as increment of salary for their hard work.
2. MAIN ISSUES
Based on the case study, it had been concluded that Paul did not have a thorough
discussion with the Engineering Manager in order to further analyze the needs to install the
new workstation. Besides, he can probe further if the new workstation will requires training
or more worker. Other than that, Paul himself did not conduct another meeting with his
department to brief on the new plan and to hear their opinions. Involving all employees are
necessary so that the workstation can achieves their target. The supervisors also do not feel
empowered since the company do not provide the necessary training to do the new job.
Therefore, they become lost productivity, no motivation and leads to turnover.
Case flow chart:
Engineering Manager proposed to install a
new computerized workstations to increase
the productivity in the plant.
As the ProductionManager, Paul agrees to
the idea. Next, CEOapproved and results
were being observed in 3 months.
Productivity and quality decreased. Received customer complaint on defect
products. After discussed with four supervisors; reasons given poor design,
inadequate training, lackof financial incentives. Soon after, twosupervisors
resigned.

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QUESTION 1: What actions could Paul have taken to prevent the problem?
In order to prevent the problem, firstly Paul needs to apply participative leadership.
He need to ensure to have two delegations between the department of engineering and
production. He need to have invites input from employees while making decision so that it
will guide him on making a wise decision. Employees should be given pertinent information
regarding company issues, and a majority vote to determine the course of action the
companywill take. Besides, all the supervisorsneedto beempoweredso that they havemore
motivation and encouragement on doing their job, thus, lead to increasing the productivity
in plant. By applying participative leadership, there will be a few advantages. In the aspect
of acceptance, employee will be more readily to accept policies and decisions that were
reached by the top management. This can help to speed ups the process of implementing
new ideas. Besides, when employees are given opportunity to voice out their opinion, their
morale remains at a high level because they feel appreciated by the company.
Other than that, Paul should focused on the decision – making. He should meet with
employees that are directly affected by the decision. Let the employees feel that they are
neededwhile making abig decisionforthe company. This will boosttheir work productivity.
The meeting should be in detailed and employees should be allowed to voice out their
opinion. When company encourage employee to give opinions on company decisions,
company will get a variety of solutions to choose from. Company should let their employees
use their creativity in order to develop more productive work processes and make the
company more efficient.
Paul also need to have a flowchart that represent the work step by step so that it can
be seen clearly if something is wrong through the process. With this method, employees can
see and imagine the process clearly and in detailed. Besides, it will also help to develop the
planning of the company. The flowchart will also help employees to take necessary
suggestions and opinions from superiors about the work related issues of the organization.
This constructive flowchart can help to implement the goals and objectives of the project.

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QUESTION 2: What steps should Paul take now to deal with the problem ?
First of all, Paul need to apologize to his team for not having a thorough discussion on
why a new workstation is being proposed. A courageous leader must be able to admit that
sometime they mistook the important things or what matters the most to the employees so
this will enable that the employee to know that their feelings being taken care of and their
work is very much appreciated. The feeling of appreciation for the employees is very
important in order to maintain their loyalty towards the company.
Then, Paul should conduct another meeting with his team to discuss and focus on the
challenges that they are facing; whether it involve technical issue or other issue. Paul need
to ensure the message or information being communicated effectively among the employees
so that everyone knows the management’s direction, goal. Besides, this action is also as a
proof to employees that every problems can be discussed. Other than that, Paul need to seek
for a shared decision in which everyone contributing their opinions and is satisfied whether
it is about the lack of empowerment or others such as incentives, or training. This will help
the team to come to a conclusion that can help to solve the problem. A budget proposal on
whether training should be necessary will also need to be prepared. This can prepares the
team on probability circumstances that might happen.
We also learnt from this case study that organizational alignment is so important as
it links the strategy, culture, processes, people, leadership and systems to accomplish the
needs of a company. An aligned organization is where their performance influences are
mutually supportive and are focused on effective and efficient delivery of results. We also
believe that empowerment is important. Empowerment is a process of enabling the
employees to set their own work related goals, encourage decision making and problem
solving within their spheres of responsibility and authority. Empowering the team is
important skill must possessed by a leader to allow and can be conceived as both self
initiated by others. Among the characteristics must have in empowerment are trust, mutual
respect, involve in decision making and build the cooperation. Significantly, by empowering
the team, it can enhance the beliefs of the employees that they are influential contributors to
the organizational success as what we see in Echo Electronic, employees want to feel that

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they have the influence too; in addition, employees can understand better the meaning of
work, become competent, and have the self determination to succeed. The benefits of
empowering the team is it can help the employees to achieve the job mastery, it allows more
control within the team, it provides the successful role models because from time to time it
enables to shape the future leader, and also it provides emotional support.