Cushy Armchair

Cushy Armchair, based in Hong Kong, is a recognized leader in the global reclining chair business. The company has fully independent business groups in 17 different countries. Cushy Armchair’s designs were targeted towards the national differences present in specific countries. For example, the recliners in the United States were built with cup holders and built in coolers and the Scandinavian recliners were made with “tingling finger” massagers. The national differences in design preferences were not only limited to the recliner features, but also to the fabric type and recliner size.

Cabletronica U.S, a large cable and wireless organization based in New York, gained control of Cushy Armchair. In an attempt to revamp Cushy Armchair, senior executive Alison Sampson was sent to take the lead in Hong Kong, replacing the well liked founder Frances Wong. Wong agreed to stay on as a consultant for 6 months while Sampson settled into her position.

Sampson’s immediate goals were to reduce costs, speed up the product design process, and improve technology transfer. After careful analysis of industry and competitor data, Sampson drafted an email memo to the executives of purchasing, sales and design in the 17 countries. The memo made the following policy changes: 1) all purchasing managers should have all chair glide-mechanisms and fabrics orders above HK$35,000 be contracted through WorldFurniture’s procurement division in New York; 2) all advertising campaigns be coordinated through the experts in New York and all advertising campaigns must be cleared by New York staff; and 3) the staff in New York should approve all substantial design and feature changes. Two months later, Sampson learned that no action had been taken to meet her requests.

The primary concern is the fact that the executives of purchasing, sales and design ignored the proposed policy changes that Sampson had requested through her email memorandum. The email that was sent was obviously not...