What Problems Are Facing Erik Peterson

1. What problems are facing Erik Peterson?

Following problems are facing Erik Peterson:

• Decision making authority and power. Unclear decision making authority makes it very difficult for Peterson to make necessary decisions. His area of responsibility is unclear from the case as well and decision making power does not match responsibility (e.g. he has to get confirmation for supplier change or chief engineer replacement – normally these would be general manager decisions, if he is responsible for profit & loss).

• Key personnel (chief engineer Curt). Problem with chief engineer whose area of responsibility is critical on this stage is unsolved.

• Compensation management. Compensation problems are solved one by one with fire-fighting method instead of developing clear compensation system.

• Equipment selection and specification. Partially those problems are due to lack of organized communication with Hardy, part of those could be also solved by Curt.

• Management support. For new general manager, who has no previous industry experience, adequate management support is vital. Peterson does not receive such support and isn't trying to solve this problem proactively.

• Zoning. In settling zoning problems Peterson has been effective in outside communication but ineffective in inside communication – Hardy problem again.

2. How effective has Erik Peterson been as a manager of the Hanover operations? Provide evidence to support your answer.

I value E. Peterson's effectiveness as a head of GMCT as „ineffective". In my opinion that was due:

1) Lack of industry experience, which was stated in the case. I think that industry experience would have helped Peterson with better planning and avoiding many problems GMCT was facing. In his case it was a must to persuade management to assign chief engineer experienced in starting operations.

2) Poor performance management skills. Case states that Curtis Andrews lacked planning skills (p.6), interpersonal skills (p.7). In this case if Peterson would have had a job description and evaluation procedure it would have helped to either improve Curtis's performance or prove to Hardy his incompetence.

3) Insufficient impact and influence. He failed to convince Hardy to transfer incompetent chief engineer (p.7). He failed to communicate few of his key personnel decisions in a timely and proper manner, for example, Stevana's assignment as Construction Coordinator. He also was unsuccessful in influencing Hardy to reverse decision on changing frequency resude pattern. His only success in convincing headquarters was related

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