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Harvard Case - Schuberg Philis: From Success to Significance

"Schuberg Philis: From Success to Significance" Harvard business case study is written by Thomas J. DeLong, Daniela Beyersdorfer. It deals with the challenges in the field of Organizational Behavior. The case study is 15 page(s) long and it was first published on : Jul 12, 2023

At Fern Fort University, we recommend Schuberg Philis implement a comprehensive strategic transformation focused on fostering a culture of innovation, empowering employees, and leveraging technology to drive growth. This strategy will involve a multi-pronged approach encompassing organizational structure, leadership development, talent management, and strategic partnerships. By embracing these recommendations, Schuberg Philis can navigate the challenges of a rapidly evolving market and achieve sustainable success, ultimately transitioning from a successful company to a truly significant player in the industry.

2. Background

Schuberg Philis, a Dutch company specializing in IT services, has enjoyed remarkable success in its early years, driven by a strong entrepreneurial spirit and a focus on customer satisfaction. However, as the company grew, it faced challenges in maintaining its agility, fostering innovation, and adapting to the changing market landscape. The case study highlights the company's struggles with internal communication, decision-making processes, and employee engagement. These issues are exacerbated by the leadership style of the founder, Jan Schuberg, who, while charismatic and driven, struggles to delegate effectively and embrace a more collaborative approach.

The main protagonists in this case are Jan Schuberg, the founder and CEO, and his son, Jeroen, who represents the next generation of leadership. Jeroen is eager to modernize the company and implement new strategies but faces resistance from his father and the established organizational culture.

3. Analysis of the Case Study

This case study presents a classic situation where a successful company faces challenges in transitioning from a founder-led, entrepreneurial model to a more structured, scalable organization. The analysis can be framed using the following frameworks:

Organizational Culture: Schuberg Philis's culture is deeply rooted in its entrepreneurial origins, characterized by a strong work ethic, customer focus, and a sense of family. However, this culture has become increasingly rigid and resistant to change, hindering innovation and adaptability.

Leadership Styles: Jan Schuberg's leadership style, while effective in the early stages, is no longer suitable for the company's current needs. His autocratic approach, while providing direction and clarity, stifles creativity and hinders employee empowerment. Jeroen's leadership style, on the other hand, is more collaborative and focused on building consensus, but he lacks the experience and authority to implement significant changes without his father's support.

Organizational Structure: The company's hierarchical structure, while efficient in its early years, has become cumbersome and bureaucratic. This structure hinders communication, slows down decision-making, and restricts employee autonomy.

Team Dynamics: The lack of clear communication channels and a culture of collaboration has created silos within the organization, hindering effective teamwork and knowledge sharing.

Motivation Theories: The case study suggests that employees are motivated by a sense of purpose and belonging, but their current work environment does not adequately fulfill these needs. The lack of recognition, limited opportunities for growth, and a perceived lack of transparency in decision-making processes contribute to low morale and a decline in employee engagement.

Change Management: The company's resistance to change is deeply rooted in its organizational culture and leadership style. The lack of a clear vision for the future and a structured approach to change management has created anxiety and uncertainty among employees, hindering the implementation of necessary reforms.

4. Recommendations

To address the challenges facing Schuberg Philis, we recommend the following:

1. Implement a Strategic Transformation:

  • Define a Clear Vision and Strategy: Develop a comprehensive strategic plan outlining the company's future direction, emphasizing innovation, technology adoption, and customer-centricity. This plan should be communicated transparently to all employees, fostering a shared understanding of the company's goals and priorities.
  • Embrace a Culture of Innovation: Encourage experimentation, risk-taking, and continuous learning. Create dedicated spaces for innovation, foster collaboration between teams, and reward employees for creative ideas and successful implementations.

2. Foster a Collaborative Leadership Style:

  • Develop a Leadership Succession Plan: Implement a structured leadership development program to prepare Jeroen and other potential leaders for future roles. This program should focus on developing leadership skills, strategic thinking, and change management capabilities.
  • Empower Employees: Delegate decision-making authority to lower levels of the organization, fostering a sense of ownership and responsibility. Implement performance management systems that recognize and reward individual contributions.

3. Transform the Organizational Structure:

  • Embrace a Flatter, More Agile Structure: Reorganize the company into cross-functional teams, breaking down silos and promoting collaboration. This structure will facilitate faster decision-making, improve communication, and enhance agility.
  • Leverage Technology: Implement technology solutions to streamline processes, improve communication, and enhance data analysis. This will enable the company to operate more efficiently and make data-driven decisions.

4. Enhance Talent Management:

  • Attracting and Retaining Top Talent: Implement a robust hiring and recruitment strategy focused on attracting and retaining highly skilled individuals. This strategy should include competitive compensation and benefits packages, opportunities for professional development, and a focus on creating a positive work environment.
  • Develop a Culture of Diversity and Inclusion: Promote diversity and inclusion within the organization, fostering a culture of respect, understanding, and collaboration. This will attract a wider pool of talent and enhance the company's ability to innovate and adapt to changing market dynamics.

5. Build Strategic Partnerships:

  • Collaborate with Technology Partners: Form strategic partnerships with technology companies to access cutting-edge solutions and expertise. This will enable Schuberg Philis to stay ahead of the curve in the rapidly evolving IT landscape.
  • Engage with Industry Leaders: Participate in industry events, conferences, and networking opportunities to stay informed about industry trends and build relationships with key players.

5. Basis of Recommendations

These recommendations are based on the following considerations:

  • Core Competencies and Consistency with Mission: The recommendations focus on strengthening Schuberg Philis's core competencies in IT services while aligning with its mission of providing innovative solutions to customers.
  • External Customers and Internal Clients: The recommendations emphasize customer-centricity and employee empowerment, ensuring that the company meets the needs of both external customers and internal stakeholders.
  • Competitors: The recommendations are designed to position Schuberg Philis as a leader in the IT services industry, enabling the company to compete effectively with rivals.
  • Attractiveness ' Quantitative Measures: The recommendations are expected to lead to improved efficiency, increased revenue, and enhanced profitability, ultimately contributing to the long-term success of the company.

6. Conclusion

By implementing these recommendations, Schuberg Philis can successfully navigate the challenges of a rapidly changing market and achieve sustainable growth. The company can transition from a successful, founder-led organization to a more dynamic, innovative, and customer-centric enterprise, ultimately achieving its goal of becoming a truly significant player in the IT services industry.

7. Discussion

Alternative Options:

  • Maintain the Status Quo: This option carries significant risks, as the company will likely fall behind competitors and struggle to attract and retain top talent.
  • Sell the Company: This option may be attractive in the short term, but it would result in a loss of control and potentially limit the company's long-term growth potential.

Risks and Key Assumptions:

  • Resistance to Change: The company's culture and leadership style may present significant resistance to change.
  • Financial Resources: Implementing these recommendations will require significant financial resources.
  • Talent Acquisition: Attracting and retaining top talent in a competitive market will be a challenge.

8. Next Steps

  • Develop a Detailed Implementation Plan: Create a detailed plan outlining the specific steps, timelines, and resources required to implement the recommendations.
  • Communicate the Vision: Clearly communicate the strategic vision and the rationale for change to all employees.
  • Pilot Programs: Implement pilot programs to test the effectiveness of new initiatives before rolling them out company-wide.
  • Monitor and Evaluate: Regularly monitor the progress of the transformation and make adjustments as needed.

By taking these steps, Schuberg Philis can embark on a journey of transformation, ultimately achieving its goal of becoming a truly significant player in the IT services industry.

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Case Description

The founders of Dutch professional services firm Schuberg Philis, and the new leadership team entrusted with the day-to-day management, must set the path forward in 2019. The company has grown into a €70 million revenue strong IT provider with top ranks in the industry's yearly customer satisfaction surveys, yet its journey has not been without bumps. In 2010, it had to stop customer acquisition for a few years, as mounting workload and their 100% commitment to satisfy customers put too much pressure on its teams. Despite adjustments to its culture with more focus on employees as well as customers, tensions built up again during the next growth phase, leading to a reorganization with leadership handover in 2017 to become more scalable. Two years later, the founders and their management team now have to decide if their organization is ready for another ambitious growth plan, aiming for a 5-fold growth in staff and revenues by 2025.

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