Global Mobile Corporation

Case Study – Global Mobile Corporation

“Damn it, he’s done it again!”

Charlie Newburg had to get up and walk around his office, he was so frustrated. He had been

reviewing the most recent design, parts, and assembly specifications for Global Mobile’s latest

smart phone (code named: Nonphixhun) that had been released for production the previous

Thursday. The files had just come back to Charlie’s engineering services department with a

caustic note that began, “This one can’t be produced, either…” It was the fourth time production

had returned the design.

Newburg, director of engineering for the Global Mobile Corporation, was normally a quiet

person. But the Nonphixhun project was stretching his patience; it was beginning to appear like

several other new products that had hit delays and problems in the transition from design to

production during the eight months Charlie had worked for Global Mobile. These problems were

nothing new at Global Mobile’s Asian factory; Charlie’s predecessor in the engineering job had

run afoul of them, too, and had finally been fired for protesting too vehemently about the other

departments. But the Nonphixhun phone should have been different. Charlie and the firm’s

president, Hannah Hoover, had video-conferenced two months earlier (on July 3, 2006) with the

factory superintendent, Tyson Wang, to smooth the way for the new phone’s design. He thought

back to the meeting …

• “Now, we all know there’s a tight deadline on the Nonphixhun,” Hannah Hoover said, “and

Charlie’s done well to ask us to talk about its introduction. I’m counting on both of you to find

any snags in the system, and to work together to get that first production run out by October

2. Can you do it?” “We can do it in production if we get a clean design two weeks from

now, as scheduled,” answered Tyson Wang, the factory manager. “Charlie and I have already

talked about that, of course. I’ve spoken with our circuit board and other parts suppliers and

scheduled assembly capacity, and we’ll be ready. If the design goes over schedule, though, I’ll

have to fill in with other runs, and it will cost us a bundle to break in for the Nonphixhun.

How does it look in engineering, Charlie?” “I’ve just reviewed the design for the second

time,” Charlie replied. “If Marianne Price can keep the salespeople out of our hair, and avoid

any more last minute changes, we’ve got a shot. I’ve pulled my technical support people off of

three other overdue jobs to get this one out. But, Tyson, that means we can’t spring engineers

loose to confer with your production people on other manufacturing problems.” “Well

Charlie, most of those problems are caused by the engineers, and we need them to resolve the

difficulties. We’ve all agreed that production problems come from both of us bowing to sales

pressure, and putting equipment into production before the designs are really ready. That’s

just what we’re trying to avoid on the Nonphixhun. But I can’t have 500 people sitting on their

hands waiting for an answer from your people. We’ll have to have some engineering

support.” Hannah Hoover broke in, “So long as you two can talk calmly about the problem

I’m confident you can resolve it. What a relief it is, Charlie, to hear the way you’re

approaching this. With Brady (the previous director of engineering), this conversation would

have been a shouting match. Right, Tyson?” Tyson nodded and smiled. “Now there’s one

other thing you should both be aware of,” Hoover continued. “Doc Brown and I talked last

night about a new battery-charging technique, one that might reduce the charging time of the

Nonphixhun by 25%. There’s a chance Doc can come up with it before the Nonphixhun

reaches production, and if it’s possible, I’d like to use the new process. That would give us a

real jump on the competition and quiet the environmentalists.”

Four days after that meeting, Charlie found that two of his key people on the Nonphixhun

project had been called to an emergency video consultation about a problem in final

assembly: The two halves of the new smartphone interface wouldn’t fit together because

recent changes in the face required a different chassis design for the rear end.

One week later, Doc Brown proudly walked into Charlie’s office with the new battery

casing. “This won’t affect the other modules of the Nonphixhun much,” Doc had said. “Look,

it takes three new pins, a new connector, and some new shielding, and that’s all.”

Charlie had tried to resist the last-minute design changes, but Hannah Hoover had stood

firm. With considerable overtime by the engineers and technical support staff, engineering

services should still be able to finish documenting the parts and specifications in time.

Two hardware engineers and three support staff went into 12-hour days to get the

Nonphixhun ready, but the specifications were still five days late reaching Tyson Wang. Two

days later, the files came back to Charlie, heavily commented in red. Wang worked all day

Saturday to review the job and found more than a dozen discrepancies in the specifications—

most of them caused by the new battery-charging process and insufficient checking time

before release. Correction of these design faults gave rise to a new generation of

discrepancies: Wang’s cover note on the second return of the prints indicated that he had had

to release the assembly capacity reserved for the Nonphixhun. On the third iteration, Wang

committed other production capacity to another rush job. The Nonphixhun would be at least

one month late getting into production. Marianne Price, the vice-president for sales, was

furious. Her customer needed units now. Global Mobile was the customer’s only supplier not

to come out with a new model this quarter.

“Here we go again,” thought Newburg.

COMPANY HISTORY

Global Mobile Corporation traced its lineage through several generations of electronics

technology. Its original founder, Bob Murray, launched the firm in 1960 as Global Electronics

& Equipment Co. to manufacture several electronic testing devices he had invented as an

engineering faculty member at a large university. The firm entered communications

equipment in 1980. A well-established corps of direct sales representatives, mostly engineers,

called on industrial, scientific, and government accounts but concentrated heavily on original

equipment manufacturers. Using their technical know-how, they entered the mobile phone

market in the mid-to-late 1980s and changed their name to Global Mobile Corporation. In this

market, Global Mobile had developed a reputation as a source of high-quality, innovative

designs. The firm’s salespeople fed a continual stream of challenging problems into the

engineering department, where the creative genius of Doc Brown and several dozen other

engineers “converted problems to solutions” (as the sales brochure bragged). Product design,

especially hardware and structural design, formed the spearhead of Global Mobile’s growth.

By 2010, Global Mobile offered a wide range of products in two major lines. Mobile phone

sales had benefited from the phenomenal growth of cell phones. However, the shift from

analog to digital technology and the emergence of smart phones mean that mobile phones

only accounted for 35% of company sales. Smart phone sales, on the other hand, had

blossomed and, with the rapid technological changes and Global Mobile’s reputation, there

was an increasing demand for phones with unique features, ranging from specialized screen

displays, functions, applications, and novel form factors.

The company had grown from 100 employees in 1980 to more than 2,000 in 2010.

Hannah Hoover, who had been a student of the company’s founder, had presided over

most of that growth and took great pride in preserving the family spirit of the old

organization. Informal relationships between Global Mobile’s veteran employees formed the

backbone of the firm’s day-to-day operations; all managers relied on personal contact, and

Hoover often insisted that the absence of bureaucratic red tape was a key factor in recruiting

outstanding engineering talent. This personal approach to management extended throughout

the organization. All exempt employees were paid a straight salary and a share of the profits.

Global Mobile boasted an extremely loyal group of senior employees, and very low turnover

in nearly all areas of the company.

The highest turnover job in the firm was director of engineering services. Newburg had

joined Global Mobile in January 2010, replacing Jim Brady, who had lasted only ten months.

Brady, in turn, had replaced Tom Swanson, a talented engineer who had made a promising

start but had taken to drinking after a year in the job. Swanson’s predecessor had been a genial

old-timer, who retired at 70 after 25 years in charge of engineering. (Doc Brown had refused

the directorship in each of the recent changes, saying, “Hell, that’s no promotion for a bench

man like me. I’m no administrator.”)

For several years, the firm had experienced a steadily increasing number of disputes

between product development, engineering, sales, and production people that generally

centered on the problem of new-product introduction. Quarrels between departments became

more numerous under Swanson, Brady, and Newburg. Some managers associated these

disputes with the company’s recent decline in profitability—a decline that, despite higher

sales and gross revenues, was beginning to bother people. Hoover commented:

o Better cooperation, I’m sure, could increase our output by 5 to 10%. I’d hoped Brady could

solve the problems, but pretty obviously he was too young—too arrogant. People like

him—that conflict type of personality—bother me. I don’t like strife, and with him it

seemed I spent all my time smoothing out arguments. Brady tried to tell everyone else how

to run their departments, without having his own house in order. That approach just

wouldn’t work, here at Global Mobile. Charlie Newburg, now, seems much more in tune

with our style of organization. I’m really hopeful now. Still, we have just as many

problems now as we did last year. Maybe even more. I hope Charlie can get a handle on

engineering services soon.

ENGINEERING DEPARTMENT: PRODUCT DEVELOPMENT

According to the organization chart Newburg was in charge of both product development (the

applied research and design function) and engineering services (engineering support). To

Newburg, however, the relationship with design was not so clear-cut:

o Doc Brown is one of the world’s unique people, and none of us would have it any other

way. He’s a creative genius. Sure, the chart says he works for me, but we all know Doc

does his own thing. He’s not the least bit interested in management routines, and I can’t

count on him to take any responsibility in scheduling projects, or checking budgets, or

what-have you. But as long as Doc is director of product development, you can bet this

company will keep on leading the field. He has more ideas per hour than most people have

per year, and he keeps the whole engineering staff fired up. Everybody loves Doc—and

you can count me in on that, too. In a way, he works for me, sure. But that’s not what’s

important.

Doc Brown—unhurried, contemplative, casual, and candid—tipped his stool back against

the wall of his research cubicle and talked about what was important:

o Hardware and structural design engineering. That’s where the company’s future rests.

Either we have it there, or we don’t have it. There’s no kidding ourselves that we’re

anything but a bunch of Rube Goldbergs here. But that’s where the biggest kicks come

from—from solving development problems and dreaming up new ways of doing things.

That’s why I so look forward to the new designs we get involved in. We accept them not

for the revenue they represent but because they subsidize the basic development work that

goes into all our basic mobile phone products. This is a fantastic place to work. I have a

great crew and they can really deliver when the chips are down. Why, Hannah Hoover and

I (he gestured toward the neighboring cubicle, where the president’s name hung over the

door) are likely to find as many people here at work at 10 P.M. as at 3 P.M. The important

thing here is the relationships between people; they’re based on mutual respect, not on

policies and procedures. Administrative red tape is a pain. It takes away from development

time. Problems? Sure, there are problems now and then. There are power interests in

production, where they sometimes resist change. But I’m not a fighting man you know. I

suppose if I were, I might go in there and push my weight around a little. But I’m an

engineer, and can do more for Global Mobile sitting right here, or working with my own

people. That’s what brings results.

Other members of the product development department echoed these views and added

additional sources of satisfaction from their work. They were proud of the personal contacts

built with customers’ technical staffs—contacts that increasingly involved project work as

expert advisors in thinking through operational problems like international compatibility,

interoperability issues between carriers, next generation technologies, and so on. The

engineers were also delighted with the department’s encouragement of their personal

development, continuing education, and independence on the job.

But there were problems, too. Shawn Reynolds, of the structural design group, noted:

o In the old days I really enjoyed the work—and the people I worked with. But now there’s a

lot of irritation. I don’t like someone breathing down my neck. You can be hurried into

jeopardizing the design.

Philip Sanchez, head of the hardware design section, was another designer with definite