1997 was a banner year for Quest Computer Corporation, a leading manufacturer of personal computers. The company surpass

[answerhappygod]

1997 was a banner year for Quest Computer Corporation, a leading manufacturer of personal
computers. The company surpassed $15 billion in sales, nearly seven times its revenue in 1992, the
year John Clarke took over as CEO.
Clarke is a hard-driving, no-nonsense leader. His vision was to create a $30 billion enterprise by the
year 2000, but things slowly started to crumble around him. What once had been an open and
productive atmosphere that cultured teamwork, was now deteriorating under the strains of political
infighting, cronyism, and allegations of sexual harassment.
In the eye of the storm was Samuel Anderson, vice president of human resource. Anderson and
Clarke worked together in the nineties at another corporation before Clarke came to Quest in 1992.
Three years later Anderson followed. Anderson immediately started using his relationship with
Clarke to influence business decisions. Anderson also leveraged his ties to discreetly resolve two
allegations of sexual harassment against rumors.” This and other incidents further strained relations
between Clarke and the rest of the senior executive team. Busy with the task of running one of the
world's leading PC manufacturing organizations, Clarke began relying heavily on three senior
executives — Anderson, Senior Vice President Tim Hunt, and Chief Financial Officer Barry Lynn.
The rest of the team felt increasingly alienated. Over a three-year period, starting in 1996, 10 top
executives left the company and following them were several essential managers and supervisors. At
the center of this exodus was the bizarre dynamics between Clarke and Anderson. Many believed that
Clarke empowered Anderson to do things way beyond his role in human resources. For example,
Anderson had significant influence on changing the organizational structure of the company,
determining what divisions ought to sell into what markets, and which products should be sold
through various departments. He also took steps to drive a wedge between senior executives,
strengthening his position with Clarke while inducing a communications breakdown throughout the
organization. Anderson had a list of people whom he would constantly campaign against by
advocating organizational changes to lower their profile. Once he lowered their profile, he would start
a process of easing them out of the door. As one executive put it, “Anderson was instrumental in
deciding which people to bring in and which were no longer acceptable in the company.”
Clarke's reliance on Anderson baffled, and angered, other executives. Anderson was very close to
Clarke, and he had a huge impact on the business. Human resource professionals usually do not play
that kind of a role, as they are supposed to try to bring the team together, but all anyone saw Anderson
doing was creating divisiveness. Instead of working together to fine-tune a coherent growth strategy,
Quest's senior executive team became disjointed and increasingly detached from the rest of the
DC: ACD01-F004
company. Their inability to lead soon had an effect on the morale of almost every employee within
the company.
Two of Anderson's initiatives drove home the point of an executive team that was out of touch with
its workers. The first initiative was the building of a multimillion-dollar on-campus cafeteria that
included reserved underground parking for senior executives. Prior to that, executives shared
parking space with the rest of the company's employees. The second initiative was the increased
security on the eighth floor of the
replaced the former CEO in 1992, his aggressive price-cutting initiatives reversed Quest's direction
and led the company to the top of the PC market. But now, Clarke was much less decisive. As one
former executive noted, “He was paralyzed by the speed with which the market was changing, and
he couldn't make the difficult decisions.” Clarke failed to see the opportunity of the web. Its main
rival was now selling over $2 million worth of products per day over the Web. In 1998, its rival
surpassed Quest in desktop PC sales to U.S. businesses for the first time.
The high turnover in the sales divisions led to instability that caused several high-profile corporate
accounts to take their business else where. As people left, the performance of the company started to
degrade. Quest attempted to construct its own build-to-order strategy by purchasing a rival
company. This failed as it had no vision to guide its direction.
Finally, things came to a head. Quest could not significantly reduce distribution and manufacturing
costs or boost PC revenues. Huge oversupplies of inventory adversely affected Quest. While its main
competitors grew at about 55 percent from the first quarter of last year to the first quarter of this year,
Questions:
c. How can you help the departments’ managers to determine when they are
meddling in other departments affairs and when they are helping other departments?
(5 marks)
d. How do you approach an executive who you believe is not performing in the best interest
of the organization?
(10 mark