The Office Equipment Company
OEC was a company that manufactured a wide variety of small office equipment in eight different countries. In one of the, El Salvador, they encountered the problem that their manager announced its resignation. Therefore, they had to choose a suitable candidate. OEC didn’t have manufacturing facilities in El Salvador, but they had been selling there for more than 22 years at that time. The sales and profits proved to be improving every year.
In 1993, OEC decided to construct a factory. The components of the machines would be imported and assembled locally as El Salvador could offer a big supply of cheap labour force. The construction would be supervised by an American technical team. The director, also American, would report to US all problems regarding the production and quality-control and to the managing director from El Salvador, all problems regarding the accounting, the finance and labour relations.
The managers from foreign subsidiaries of OEC are used to being rotate among foreign and domestic locations which offered them an important international experience.
II. The Problem
The main problem outlined in the case study is that the committee does not know which candidate would best fit the managing director’s position. Causes for the problem
* Current managing director has handed in his resignation and will leave in one month * Current OEC policy only allows for promoting, not hiring from outside the company. Negative effects
Long-Term
* Loss of international competitiveness if new managing director isn’t capable of handling his duties. * The image of OEC in El Salvador may be...
