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Black & Decker: Global Lock Business

Change Management Group Project Part 1


Cassie Amundson
Michelle Caylor
Shannon Felty
Kristin Geers
Hayley Hagel
Shannon Hoven
Michael Illes
Donald Kirchmann

Minnesota School of Business


Change Management (HR440)
Jackie Kidder
August 16, 2010

Black and Deckers Global Lock Business Team 1

Introduction ................................................................................................................................3
Written by Kristin Geers
What is the Global Lock Business and Thoughts about the Plan .........................................3
Written by Donald Kirchmann and Cassie Amundson
The Favorable Factors of Implementing the Global Lock Business .....................................4
Written by Michelle Caylor, Hayley Hagel, and Michael Illes
Opposing Factors of Implementing the Global Lock Business ..............................................5
Written by Kristin Geers, Shannon Hoven, and Donald Kirchmann
Potential Organizational Implications .....................................................................................6
Written by Cassie Amundson, Michelle Caylor, and Donald Kirchmann
Necessary to Work: Culture, Structure and Systems .............................................................7
Written by Kristin Geers, Hayley Hagel, and Shannon Felty
Implementing an Action Plan for the Global Lock Business .................................................7
Written by Shannon Hoven, Shannon Felty, and Michael Illes
Conclusion ..................................................................................................................................9
Written by Shannon Felty
References ...................................................................................................................................10

Black and Deckers Global Lock Business Team 1


Introduction to Black and Decker and the Global Lock Business
In 1985Black & Deckerhad disjointed international product lines and policies,
dissatisfied customers, and a tarnished reputation (Cummings & Worley, 2008, p. 739). Nolan
Archibald, Chief Executive Officer at this time, vowed to make significant changes to his
organization. In the following years a worldwide market was created, the numbers of current
product models were drastically reduced, and top managers were hired for new product
development. Archibalds dedication to the turnaround of the organization put Black & Decker
among the top 200 largest US-based industrial companies listed in Fortune magazine in 1987
(Black & Decker, 2009). Other awards and high rankings soon followed; Sales & Marketing
Management Magazine ranked them as having the best sales force in an U.S.A survey in 1987
and they were also awarded the Medal of Professional Excellence by Purchasing Magazine in
1988 (Black & Decker, 2009). In 1989 Black & Decker acquired Emhart Corporation. Fred
Grunewald, vice president of product and market development for the international group
(Cummings & Worley, 2008), took on the task of taking this acquisition to a new level. In 1990,
Grunewald proposed combining the eight lock brands, Kwikset, Russwin, Corbin, Price Pfister,
DOM, NEMEF, Lane, and ASTRA, acquired by Emhart into one global Black & Decker lock
business (Cummings & Worley, 2008).
As companies are acquired, business plans change as opportunity presents itself.
Grunewald saw an opportunity for Black & Decker in the Global Lock Business and developed a
well-integrated plan to introduce and move forward with. However, there were many favorable
and opposing factors to consider, structural and cultural considerations, and overall change
management to implement the plan successfully.
What is the Global Lock Business and Thoughts About the Plan
Grunewald was with Black & Decker for less than one year when he was given the
challenge of radically changing the structure of the lock company. Grunewald had developed a
very creative, large scale plan for creating a global lock business. He had taken into
consideration a way to increase the global market share as well as the revenues for Black &
Decker. Although the plan was ideal to present to upper management, there were many details
that still needed to be worked out. Such details included the need to develop an implementation
plan. Grunewald needed to develop a plan that would detail which actions would be taken first,
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Black and Deckers Global Lock Business Team 1


who would be taking them, the costs driving the changes, and the desired outcome (Cummings &
Worley, 2008). Once these items were defined, top management would have a clearer picture of
specific actions that need to be taken, and then would be able to determine whether Grunewalds
plan was feasible. By implementing the global lock business, Grunewald would develop new
positions for marketing managers in Belgium, Brazil, Dubai, Japan, Mexico, New Zealand, and
Miami. Along with these managers he also suggested creating positions for a product manager
for residential hardware and plumbing, a product manager for architectural hardware, a technical
manager for applications and support, and a group project manager for hardware products within
the International Division. In addition to these managers, Grunewald then suggested embedding
a local champion to act as a liaison between the company and on-the-ground managers and as
project managers for new products. As Grunewald continued with his change plans he needed to
ensure transparent lines of communication were fully considered as several changes were to take
place simultaneously and all management needed to be fully engaged in the changes occurring.

Favorable Factors of Implementing the Global Lock Business


There are favorable factors that were considered when implementing a new business such
as the Global Lock Business, and it is important to have the right person such as Grunewald in
charge of overseeing the steps for change to ensure properly executed implementation.
Grunewald carried with him an expansive amount of experience; in addition he was confident
that he had built the credibility with the operating managers to implement the global lock
strategy. Such experience included ten years at General Electric in sales, product management,
marketing, and strategic planning. With Grunewalds knowledge and experience, his know-how
in improving market knowledge along the dimensions of competition, understanding consumer
segments, and product requirements, would give Black & Decker the power to create a satisfying
distribution base, to instill global quality standards throughout the world, to promote product
innovation, and in general bring a unified force and credibility to their effort.
Addressing the population globally by recognizing a need for locking systems, Black &
Decker saw a win-win solution in Grunewalds plan. The plan was valid and important to the
future financials of Black & Decker as well as competing with the competition. With the
acquisition of Emhart, there were solid and well-known brands already established that Black
and Decker was able to secure in order to help build upon the foundation of the global lock
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Black and Deckers Global Lock Business Team 1


business. Having a solidly built product foundation, the company could only see the benefits in
continuing on the global lock business track. As the lock business stood previously, there were
areas of opportunities that were not being met as current manufactures were not offering
products that met the total market segment (Cummings & Worley, 2008). Black and Decker had
determined the opportunities, goals and were focused on filling the market gaps.
Black & Deckers goals were to coordinate management, finish market research, simplify
production, streamline distribution channels and overcome regional differences (Cummings &
Worley, 2008). With the goals established, and Grunewalds plan in motion, Black & Decker
would thrive on the awaiting opportunities. There were many new opportunities for Black &
Decker to expand globally and create more synergy between disparate lock manufacturers,
designers, and marketers to fully integrate and use best practices from the larger, parent
company. There were also the new cultures and ways of working as well as the sense of urgency
and change that accompanies any merger; it was a prime chance to imprint a new way of doing
business in the lock industry. Grunewald was thinking outside the box and worked diligently
on the integration of the lock business into Black & Decker.

Opposing Factors of Implementing the Global Lock Business


As with any change, especially such drastic change that the Global Lock Business will
bring for Black & Decker, there are factors to consider that may cause obstacles during
implementation. The overarching factor to consider is the compatibility and cooperation of the
acquired companies: Kwikset, Russwin, Corbin, DOM, NEMEF, Lane, Price Pfister, and
ASTRA. Up until the point of acquisition, these companies had been managing themselves.
With that stated, the companies may show resistance to Grunewald changing any aspect of their
current ways of working. Along with the hesitation of the individual companies comes the
hesitation of the entire market; a market rich in old world thinking must be convinced as well as
the market in any other country Grunewald wants to explore. As with every business change
there are the benefits and rewards, but also the hardships and hurdles to get over as well.
Grunewald was clear that he voiced his concerns about things such as, brand proliferation,
marketing inconsistencies, poor market knowledge, and inconsistent merchandising terms and
policies (Cummings & Worley, 2008). The brand proliferation had the potential to allow a
company to expand successfully or break apart because of lack of company attribution. Not
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Black and Deckers Global Lock Business Team 1


knowing the new market well enough to know how to successfully market to them could pose a
real problem not only in the U.S. but also in other countries. Grunewald also expressed that he
was worried about how the new branch would run; would it run similar and adopt the new
policies or would it have to run differently to be successful? Everything needs to be consistent
and run in a way that the company can keep up with itself. Also, the fact that they may not be the
only company looking into this same expedition is a very large factor that could make
implementation more difficult. The faster the plans could be smoothly implemented the better off
Black & Decker would be. With the expansion and new jobs being implemented the
communication transparencies between headquarters, on-the-ground, and local-champion
personnel must be maintained at all times in order to align the business and incorporate buy-in
from all angles. The biggest plan issue Grunewald needed to address was to fully implement
within a year before the competition addressed the global opportunity and implement its own
strategies.

Potential Organizational Implications


Black and Decker will need to do extensive research and product development to ensure
that the products will go over well in the new markets. They will need additional training on the
locks that they are not familiar working with as well as additional management staff and project
managers. In addressing all these change activities simultaneously, Grunewald would need to
ensure there is continued transparency. In creating a sense of transparency in the plan and
ongoing processes, this plan needed to be communicated, as well as input needed to occur
between employees whom were Local Champions, On the Ground, and in various levels of
management. There were many changes that would occur in a short timeframe, causing stress on
people and within the workplaces, it was necessary to continually communicate the changes with
the various locations to prevent the plan from imploding. This strategy would require Black &
Decker to work on their global approach in the identification and development of their product
through a process of strategic, managerial, and operational activities. If done correctly, the
research would set priorities for new products and to review their status on a regular basis to
ensure success going forward. Black & Decker would need to work more on of a global level and
to continue working under a continuous degree of research, assessment, goal setting and
evaluation.
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Black and Deckers Global Lock Business Team 1

Necessary to Work: Culture, Structure and Systems


All decisions going forward in regards to products and change will need to be made at
one central location which combines the acquired companies; the location where these decisions
should be made and overseen would be the Black & Decker corporate headquarters. By
centralizing the decision-making in terms of products and change, this would set the tone of
culture change, structure, and globalization for the rest of the organization going forward. Black
& Deckers culture would need to be re-invented in order for the global lock business to be
successful. Employees would need to start doing things differently than in the past which
included expanding their market and communication levels along with using a greater amount of
technology. The culture will need to be guided through the change and continually be molded
and formed in order to accept and be accepted in multiple countries and the diversity that comes
with each. This would be a large undertaking for Grunewald however was necessary to have a
foundation of a streamlined organization to build upon in the future.
The structure needed to make the global lock business work would be a divisional
organizational structure. The divisional structure groups organizational activities on the basis of
products, services, customers, or geography, which is exactly Grunewalds idea for the global
lock business structure. Most or all of the resources and functions necessary to accomplish a
specific objective were set-up as a division headed by a product or a division manager which was
Grunewalds creation starting with the Intercompany Organization, the headquarters, the
international market managers, the source business, the product managers, and the market
Managers (Cummings & Worley, 2008). The system as a whole would need to be re-evaluated;
such items to consider were how orders were placed, billed, forwarded, expedited, and
processed. There would need to be new staffing, training, transfer pricing, and forecasting as
well. In developing a full analysis of the culture, structure, systems and harmonizing each
properly, Black & Decker would soon see the benefits of its Global Lock Business.

Implementing an Action Plan for the Global Lock Business


In order to make Grunewalds Global Lock Business plan perform well, Black & Decker
needed to have a structure that was very defined yet flexible. This may seem like a direct

Black and Deckers Global Lock Business Team 1


contradiction, however this means a corporate hierarchy that is well defined with lines of
communication that are direct; yet leaving the business units organic enough to incorporate new
product lines, employees, and procedures to be successful in a global market. Black & Deckers
culture would need to reflect the values, traditions, and meanings that not only make them
unique but make each of their global clients unique. A global companys culture must be open to
and embrace diversity. Lastly, Black & Deckers systems need to be fully integrated. Each
business unit needs to be able to share information, both locally and globally, with each other
without data loss or translation issues. The new global lock business unit would be an extension
of the existing company while incorporating new global views.
The most important part of any change in business is to keep any and all communication
lines open through every step of the process. To successfully start implementing the new plan,
Black & Decker needed to inform everyone in the company of any changes that will be made to
positions, structures and ways of working which would create transparency. Globalizing an
existing company requires tremendous amount of change and all employees in the company
could be impacted in one way or another. Marketing and Communications needed to be fully
engaged and aligned in order to develop a plan of introducing new countries and external
cultures as well as assisting with cultivating the internal culture. The implementation of a change
initiative this substantial would entail many resources and a strong backing from the senior
leadership at Black & Decker. Eliciting and incorporating the opinions and ideas of senior
leadership and management would garner support for the integration before moving ahead as this
would allow for buy-in with proposed changes and a clearer understanding of the benefits of the
globalization.
Enlisting champions on the ground as well as having an extensive communications
plan would be the first tasks that would need to be completed. The front line staff as well as the
different managers around the world would need to understand the change and be willing to
support it as it will be a different way of doing business. As the changes are being implemented
it would be important to check and verify that all the details are being followed such as are the
road bashing sessions working or failing? This continued evaluation would be just as important
to the overall success of the project. There would also need to be a continual review process and
an opportunity to modify the plans if something is not working or buy-in is less than favorable.

Black and Deckers Global Lock Business Team 1


Conclusion
As Black & Decker strives forward with its plan, it will be able to benefit greatly from
the acquisition of the Emhart Corporation. By enlisting Grunewald to act as the catalyst for the
organizational change, a plan has been successfully developed that will allow top executives to
see the overall desired results of the integration. Although the plan has not been fully developed,
executives will have enough information to determine whether or not Black & Decker is in a
proper state to be able to develop the integration into the next steps.
Many challenges lay ahead for Black & Decker, with the biggest challenge being time.
Grunewald senses that Black & Decker is not the only organization pursuing a presence in the
global lock business. Although he has suggested full implementation of the integration, there are
many questions to be answered before implementation can begin such as: How would the new
president of the lock business structure the lock companies? Would that business choose to adopt
the quarterly planning reviews that characterized the power tools and housewares business? How
would the bashing of the product roads take place? However, if the Black & Decker executives
favor Grunewalds plan thus far, he may be given the authority to pursue answers to these
questions.
By developing an overall plan, Grunewald should have minimal trouble being able to fill
in the plan gaps and details as long as he has the support and resources needed to execute his
plans. The limited time may be an issue, however the sooner Black & Decker can become
present in the global lock industry; the more likely they will hold the greatest market share.

Black and Deckers Global Lock Business Team 1


References
Black & Decker. (2009). Customer Support: Company History. Retrieved August 17, 2010, from
Black & Decker Corporate Web site:
http://www.blackanddecker.com/CustomerCenter/Company-Information.aspx
Cummings, T. G., & Worley, C. G. (2008). Organization Development & Change (9e ed.).
Manson, OH, USA: South-Western Cengage Learning.

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