Tootsie Case

Abstract

Major issues in the case of Tootsie Roll Industries, Inc are the management style and governance, and the International market penetration. I recommend actions starting with a strategic analysis of the company, hire new executive managers as well as new financial managers, create succession plan, identify the competitive advantage of the company, and finally a comprehensive strategy for International market penetration. Our objectives are identification of weakness and gaps in the supporting organizational arrangements, support the competitive advantage by creating a succession plan, create brand image that can stand the competition, and diversify the tootsie markets and provide alternative to the declining American revenue

Major Issues

The most critical issue for Tootsie Roll Industries, Inc. is the management style and governance. The Gordons are currently governing four top level management positions in the company; the president and the chief operating officer by Ellen Gordons, the chairman of the board and the chief executive officer by Melvin Gordons. They took over most of the decision making in the company without distributing the power because of their firm hold on the company (66% of voting stocks and 47% of all shares). They manage Tootsie in a defender strategy style focusing on keeping their market domain and the efficient distribution of their products (Miles et al, 1978). Future vision and goals of a defender company are driven by the top management, and any disturbance or change in management could distort them. Another reason the management style and governance is a critical issue is the lack of succession plan. The Gordons are in their sixties and seventies and despite their advanced age they have no strategy for their retirement. Any illness or the sudden death of any of them will create a management void, which can be harmful for a centralized organization. Any company’s success depends on their utilization of the core competency...