Features of Cadbury Business - Coursework Example

Cadbury Affiliation: History Cadbury was a family business that started with John Cadbury (father) in 1824 as a shop for selling cocoa, drinking chocolate and even tea among other things which he prepared. The shop was situated in Birmingham. Motivated by the increasing turnover and profits of the shop, he decided to expand it and make a commercial sale and this therefore made him move to a large warehouse in 1831. His booming business and its success was brought about by the fact that his large clientele was from the rich people hence enabling him to not only afford to import the cocoa but also make a large profit in the process. He increased the variety of drinking chocolates making it even available in powder and cake form. He later partnered with his brother and relocated their business and even moved it to Bridge Street (Bradley, 2011, pg. 10). His sons later took over the company and even bought a land to relocate the company to. Their first chocolate bar (Dairy Milk) was launched in 1905 and with the high return, they started producing more varieties of chocolates and even engaging in more corporate social responsibility by supporting soldiers during the world war 1. The expansion of the company was through acquisition of other smaller companies and merging with others such as Schweppes. In 2010, Cadbury was sold to Kraft Foods an American company for 11.5 billion pounds. Even though this was a disappointment to Britons, the move still took place. This move as with all other purchases put at risk the jobs of thousands of it employees as the subsidiary companies were closed or sold and hence resulting to massive job losses. Kraft Foods was later in 2011 subdivided into two and Cadbury ended up under Mondelez International which deals with confectionaries. Motivation What motivated the take-over by Kraft Foods was the fact that the company was making a lot of profits and continued to increase their branches throughout the world including even having its manufacturers and distributors in the United States like the Hershey Company. Its potential was therefore deemed to be undermined in Britain but would not be so if taken over by a food giant (Kraft). The final offer made just like in other companies which are sold was irresistible by the management of Cadbury. Money was therefore another motivating factor among other benefits just like explained by the incentive theory of motivation (Naegelen and Mougeot, 2011, pp. 395). These incentives were viewed by some of the managers as irresistible and hence accepting the offer by Kraft Foods despite the protests by the British citizens who considered Cadbury their own mark in history. Organizational culture plays a very important role in any acquisition or sale deal. This was evident in the acquisition and even mergers of companies such as Glaxowell and Smithkline Beecham. The same was not different in the case of Cadbury by Kraft Food. Schein, 2004 describes the different types of organizational cultures. The one that matches what Cadbury had before the sale is espoused values where the employees hold certain beliefs and attitudes which reflect on their organizational performance. In this case, employees were always positive and so was their work environment and this were evident even from some of the managers (who resigned once the take-over was finalized) for example Roger Carr (who was the chairman and Andrew Bonfield who was the chief financial officer). Their positive attitude and belief accompanied with pride for the achievements of the company is what increased tremendously the performance and led to attracting Kraft Food to purchase it. Management style The management style of any organization serves different purposes including contributing to the success or failure of the company. The same was the case in Cadbury. According to (Zaman, 2011, pg. 6), the management style in Cadbury was democratic up until it came to the time for selling to Kraft and from then when it changed to autocratic and then bureaucratic after that. This style of management cannot be compared to what happens in big multinational companies such as Google and others whose management style is purely democratic which allows the employees a certain freedom to be creative and hence reducing the turnover rate to other companies as well as having to lay off workers. When Kraft Food took over Cadbury and their management style proved different from what they were used to, not only did the former managers resign but they also created a platform and laid the foundation for other employees who were not in agreement to resign as well. This was before this management style proved difficult to increase performance and hence making some of the subsidiary branches in other countries be closed down and hundreds of people losing their livelihood in the process due to reduced performance and lack of self-motivation and motivation from the management as well. Up until recently when the company received training on management and leadership styles, Kraft Foods (Mondelez International) as mentioned earlier was operating on an autocratic type of management. This is probably the reason it did not make it in performance as compared to other companies such as Starbucks or Nestle Inc. which operate on a combination of laissez fair and democratic types of management style and the results are evident from the different ratings. Managing changes and analysis In order to improve performance and even continue expansion of the Cadbury company at the rate it was growing at or even at a higher rate, Kraft Foods would have to change its management style and motivation criteria. An example of a company whose management style has made even the investors threaten to withdraw is Microsoft under the leadership of Steve Ballmer who is an autocratic leader hindering creativity in the company and making not only executives resign but investors to complain as well. The management does not necessarily have to adopt a laissez fair type of management style at this level like other companies in the world such as Semco in Brazil has done or even Apple, but it can start by implementing a democratic type of management like most US-based companies do. This integration is bound to make 360 degrees changes in the company. All the management needs to enforce is to have an open communication with its employees who are the major performers in the organization. This is provide the employees with a platform to not only dialogue and make suggestions but also air their grievances openly and reducing the turnover rate and the continual laying off employees due to closure of the subsidiary branches in the long run. Having transformational leaders such as Steve Jobs will also play a big role in not only changing the management style of the company but also in improving immensely the performance of all the products of this giant food industry. Harvard Business Review provides some of the tips of managing changes in an organization and these include focusing on management issues such as leadership, motivation, organizational culture and communication among others. If these issues are addressed properly and with the larger focus being on all the stakeholders of the company as explained by the stakeholder theory including the employees, then with time success will be imminent and the Cadbury name will not have to completely disappear with more closure of their manufacturing or distribution branches in other countries. A move from the classical management theories with the focus being on the structure of the company to human relations theory where the management will be focused on the human factors such as the leadership, motivation, group behavior and attitude, interests, social need and even self-fulfillment of those working in the Kraft Foods is needed. It is only through considering the human factors that the changes long yearned for and the increase in performance anticipated after the acquisition of Cadbury will happen. Flexibility by the management is needed for sustainability and expansion (Somech, 2006, pp. 137). Recommendations Having mentioned the history of Cadbury including what contributed to its immense success when it was still in the hands and control of British and the Cadbury brothers and how after the sale to Kraft Foods things are not looking very much on the positive brought about by the differences in the management styles, it is time to consider the below mentioned recommendations incorporated with the ones mentioned above. This is the only way the company can prevent itself from more losses and criticisms brought about by the fact that its laying off a lot of workers who initially worked for Cadbury and the resignation of many others due to the numerous closing of their factories and branches in different parts of the world and even increase their products manufacture and sale. Two of the most crucial recommendations include training on management to their managers and other leaders involved in final decision making of the company and communication with the employees and other stakeholders of the organization. The training should include even refresher courses on management and eventually leading to not only changing their attitude and behavior but also practically enforcing these changes in the organization. Other than this, there should be emphasis on an open communication channel. The communication and consultation can even be extended to some of the former employees and managers of Cadbury and especially those with deeper knowledge of the company as they hold the key to success of the company even in the present. Reference Bradley, J. (2011). Cadburys Purple Reign: The Story Behind Chocolates Best-Loved Brand. New Jersey: John Wiley & Sons. Naegelen, F. and Mougeot, M. (June, 2011). “Power of Incentives with Motivated Agents in Public Organizations.” Journal of Public Economic Theory, vol. 13(3), pp. 391-416. Schein, E. (2010). Organizational Culture and Leadership. New Jersey: John Wiley & Sons. Sirkin, H., Keenan, P. and Jackson, A. (October, 2005). “The Hard Side of Change Management.” Harvard Business Review. Retrieved from: http://hbr.org/2005/10/the- hard-side-of-change-management Somech, Anit. (February, 2006). “The Effects of Leadership Style and Team Process on Performance and Innovation in Functionally Heterogeneous Teams.” Journal of Management, vol. 32(1), pp. 132-157. Zaman, N. (2011). Cadburys Employee Relationship Management: The Practices of a Place to Be. New York: GRIN Verlag. Read More