Nono
The paradoxicaltwin: Acme and Omega Electronics
PART I
In 1955, Technological Products of Erie, Pennsylvania was bought out by a Cleveland manufacturer. The Cleveland firm had no interest in the electronics division of Technological Products and subsequently sold to different investors two plants that manufactured printed circuit boards. One of the plants, located in nearby Waterford, Pennsylvania, was renamed Acme Electronics, and the other plant, within the city of Erie, was renamed Omega Electronics, Inc. Acme retained its original management and upgraded its general manager to president. Omega hired a new president, who had been a director of a large electronics research laboratory, and promoted several of the existing personnel within the plant.
Acme and Omega often competed for the same contracts. As subcontractors, both firms benefited form the electronics boom of the early 1960s and both looked forward to future growth and expansion. Acme had annual sales of $10 million and employed 550 people. Omega had annual sales of $8 million and employed 480 people. Acme was consistently more effective than Omega and regularly achieved greater net profits, much to the chagrin of Omega’s management.
Inside Acme
The president of Acme, John Tyler, credited his firm’s greater effectiveness to his managers’ ability to run a “tight ship”. He explained that he had retained the basic structure developed by Technological Products because it was most efficient for high-volume manufacture of printed circuits and their subsequent assembly. Tyler was confident that had the demand not been so great, its competitor would not have survived. “In fact,” he said, “we have been able to beat Omega regularly for the most profitable contracts, thereby increasing our profits.” Acme’s basic organisation structure is shown in Exhibit 1. People were generally satisfied with their work at Acme; however, some of the managers voiced the desire to have a little more latitude in their
PART I
In 1955, Technological Products of Erie, Pennsylvania was bought out by a Cleveland manufacturer. The Cleveland firm had no interest in the electronics division of Technological Products and subsequently sold to different investors two plants that manufactured printed circuit boards. One of the plants, located in nearby Waterford, Pennsylvania, was renamed Acme Electronics, and the other plant, within the city of Erie, was renamed Omega Electronics, Inc. Acme retained its original management and upgraded its general manager to president. Omega hired a new president, who had been a director of a large electronics research laboratory, and promoted several of the existing personnel within the plant.
Acme and Omega often competed for the same contracts. As subcontractors, both firms benefited form the electronics boom of the early 1960s and both looked forward to future growth and expansion. Acme had annual sales of $10 million and employed 550 people. Omega had annual sales of $8 million and employed 480 people. Acme was consistently more effective than Omega and regularly achieved greater net profits, much to the chagrin of Omega’s management.
Inside Acme
The president of Acme, John Tyler, credited his firm’s greater effectiveness to his managers’ ability to run a “tight ship”. He explained that he had retained the basic structure developed by Technological Products because it was most efficient for high-volume manufacture of printed circuits and their subsequent assembly. Tyler was confident that had the demand not been so great, its competitor would not have survived. “In fact,” he said, “we have been able to beat Omega regularly for the most profitable contracts, thereby increasing our profits.” Acme’s basic organisation structure is shown in Exhibit 1. People were generally satisfied with their work at Acme; however, some of the managers voiced the desire to have a little more latitude in their