CaseStudyTeamDynamicsatInitech-DardenPubl.pdf
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This case was prepared by Steve Jackson (MBA ’06) and Jack Hager (MBA ’06) under the supervision of Associate
Professor Lynn A. Isabella. It was written as a basis for class discussion rather than to illustrate effective or
ineffective handling of an administrative situation. Copyright 2006 by the University of Virginia Darden School
Foundation, Charlottesville, VA. All rights reserved. To order copies, send an e-mail to
[email protected]. No part of this publication may be reproduced, stored in a retrieval system,
used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying,
recording, or otherwise—without the permission of the Darden School Foundation. Rev. 10/07.
TEAM DYNAMICS AT INITECH
Cash Jackson sat in his office on a windy spring day in 2006 and wondered what to do
next. As the vice president of supply-chain management at Initech, a Chicago-based company,
Jackson needed to figure out what to do about the supply-chain operations team. The team was
underperforming, morale was low, and many team members were contemplating leaving the
company. Since the team was key to the success of the business as a whole, something had to be
done. Jackson thought that an assessment of the team’s dynamic might be the first place to start.
Initech Company Background
Initech was a privately held firm headquartered in the western suburbs of Chicago,
Illinois. The company provided supply-chain services to the Burger Barn quick-serve restaurant
system. Ron Burgundy founded the company in 1947 to provide distribution services to Burger
Barn restaurants in the Chicago area. Burgundy was a personal family friend of Ray Graham, the
man who had made Burger Barn what it was. As Burger Barn grew, Initech grew with it. By
2003, Initech handled all the packaging procurement and distribution for the 13,500 domestic
Burger Barn restaurants. The company also managed the distribution of all promotional items for
Burger Barn, including kids’ meals, toys, and Monopoly games. Initech was an expert in supply-
chain distribution and promotion execution. Although the business was privately held and
financial data was not released, annual revenues were estimated at $1 billion. The firm only
employed 200 people. The risk to Initech’s business was that Burger Barn was its only customer
and in the tradition Graham started, all business transactions were sealed with a handshake—no
contracts. At all costs, it was absolutely vital to the survival of the company to keep Burger Barn
happy.
The Supply-Chain Operations Team
A large part of the business at Initech was the planning and distribution of promotional
items during assigned promotional time frames. This part of the business fell on the supply-chain
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operations team. The team was made up of fourteen people: one director, two managers, four
project managers, two systems-support people, and five planners (see Exhibit 1 for the
organization chart). The following section describes the most important team members in the
context of this case.
Lynn Nettle was the director of the department—a position she had moved into two years
earlier. She had been with the company for seven years and had an MBA from DePaul
University. Nettle sat in a large office just outside the cubicles where the rest of the team was
located. She rarely left her office except to go to meetings or to confront a team member about a
problem. Nettle rarely acknowledged strong performances, but sure made notice of mistakes.
Nettle had an abrasive way of interacting with people, and often grilled employees with a series
of questions to get what she wanted. She had designed performance metrics that stressed
individual rather than team performance. The team felt Nettle had her eye on the bigger prize and
was more focused on the short term to get a quick promotion. Upper management loved her
because she got quick results. Once, in a high-level meeting, Steve Ritchie was recognized for
his contributions to a specific promotion project. Nettle called him into her office and said,
“Thank you for making me look good in the meeting.” Instead of focusing on rewarding
Ritchie’s contribution, Nettle focused on the fact that his contribution was beneficial to her, not
to the team. This happened often.
Doug Jennings was one of two managers in the group, and half of the team worked for
him. Jennings was seen as a rising star in the company and was the most respected leader on the
team. Leading by example, he was a man of few words. He would stay late and never left before
the team did. As well, Jennings was a great resource and a good teacher for less-experienced
team members. He was not very good at participating in or managing conflict, though. As a
result, when problems arose with employees, he ignored them instead of confronting them. This
created problems on the team, because certain individuals were seen as receiving special
treatment. Sharon Nutburger and Paul Trailerman were the two biggest examples of this.
Karmen Winters was the other department manager, and the other half of the team
worked for her. At 25, she was very young and many of the people she managed were older than
she was. Winters meant well, but just did not know what to do. She had no experience managing
people, so she tried to be everyone’s friend instead of acting like a leader. Winters, like Nettle,
was well known as a manager who would take credit for the performance of her subordinates.
None of her employees respected her, and she played favorites with them. She did not like to
hear constructive criticism, and had no interest in helping employees from a career-development
standpoint. On a personal level, Winters seemed to be a good person who meant well. She just
did not have the management experience needed for a leadership position. Many a night, the
team would ask her to buy them dinner because they had to work late. She always replied she did
not want to draw down the money from her expense account, because it would affect her bonus.
Sharon Nutburger was a project manager in the department. She had worked for the
company for over 20 years and knew more than most. Within a defined set of work rules,
Nutburger performed very well. But she had no capacity to problem-solve in ambiguous
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situations and was known for saying “…because this is how we have always done it.” She was
disliked by most on the team and had a very abrasive personality. But because she was good at
her job, her attitude was overlooked by the management team.
Steve Ritchie, like Nutburger, was a project manager. He had originally been sent to
Initech as a consultant and was hired full time due to his strong performance. Ritchie was known
as one of the brightest employees on the team, although he was one of the youngest at age 25. At
times, he was arrogant and impatient at the pace of his career progression. He found the job
boring and unchallenging and was generally unhappy. Through strong personal relationships, he
held a lot of power in the group, and the managers knew that his support for decisions was
necessary to get other team members’ cooperation.
Paul Trailerman was the systems expert in the group. He had designed the operations
system and knew things others did not. Trailerman did not like to share information because this
would reduce his power in the organization. He regularly came in late and left early. He was
known as one of the least ethical people on the team. On the other hand, when the system went
down he would work through the night to fix it. As a result, the management team was more
lenient with him than it was with most employees.
Mark Haggard was a 27-year-old with a supply-chain degree from one of the best
schools in the country. He had worked at many well-known companies before coming to Initech
and had vast experience. Haggard worked on the software systems with Trailerman. He had
learned his job quickly and was at work on time everyday. But Haggard was frustrated at the
slow pace of his career growth at Initech and with the special treatment Trailerman received.
Dave Bon Jovi was a great guy, and everyone liked him. He was very good at his job as a
project manager. Bon Jovi was politically savvy and known for creating allies across the
organization. He had strong, analytical skills and was seen as a mentor to many in the group.
Kim Loco was a planner and held the lowest-level position in the group. She had worked
at Initech for two years. She was known as one of the most inept employees on the team. It took
a long time for her to be trained, and she regularly made bad decisions. She had poor business
acumen, but was actually quite nice on a personal level. Loco worked for Winters, and many
believed that their close friendship was the only reason Loco was still around.
Mike Johnson was the youngest team member. He had just graduated from college and
had worked at Initech for about two months. He had not majored in business, and many did not
understand how he got the job as he had no real qualifications. It came out rather quickly that his
father was a Burger Barn executive vice president who had pulled strings to get him the job.
Johnson was great at personal networking, but not so great at his daily job.
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A Day in the Life
Managing the distribution of promotional items for Burger Barn was a stressful job. Over
20 million items needed to be moved from 37 distribution centers to 13,500 restaurants in any
given 4-week promotional period. The supply-chain operations team had to interface with many
key stakeholders at a furious pace throughout each day. The efforts of logistics providers
(trucks), distribution-center employees, Initech employees, Burger Barn store managers, and
owners needed to be perfectly aligned for proper execution. From the first minute each morning
until the end of the day, team members spent most of their time fighting tactical fires. There were
many late nights and weekends, and the job was known more as a lifestyle than as a traditional
job. The pressure was always on. There was little time to step away and look at the big picture—
or even rest, for that matter. As time went on, the team grew more and more fatigued as there
seemed to be no end in sight to the frantic pace.
Many employees, including Ritchie and Haggard, had come from jobs where at least half
of their time was spent on strategic issues, which required deep thought and time away from the
tactical side of the job. As a result, they encouraged team members to think about the big picture
and how to improve the situation overall. As time went on, many suggestions were passed on to
the managers and the director, Nettle. Their suggestions were often brushed aside. Eventually,
the team became demoralized and felt it was only there to execute. The company seemed to have
no interest in its ability to think strategically. This hurt morale and made each team member feel
as if there was no future at the company—for that matter, they even began to question the
purpose of a team. Ultimately, the team took less and less time to think about the big picture.
Team Politics
With 14 people on a team, it was hard to know how many subgroups were formed.
Haggard and Trailerman created one group. They had similar interests and were alike in many
ways. Loco, Winters, and Johnson were allies. Jennings, Bon Jovi, and Ritchie were tightly
aligned. Those subgroups represented three blocks of power within the larger team. Many times,
factions worked against each other, because they had different goals and aspirations. Jennings,
Ritchie, and Bon Jovi regularly butted heads with Winters, Loco, and Johnson over team
processes and goals.
There were also a host of individual agendas and people who just plain disliked each
other. Ritchie and Haggard had higher career aspirations. They spent much of the time
complaining about the slow progression of their careers and how much they hated their jobs.
Trailerman continually complained about how he was passed over for the promotion Winters got,
even though Trailerman had more experience. He openly attributed this to the fact that Winters
was an African American female. Haggard was frustrated with Trailerman’s lack of work ethic
and the fact that he showed up late every day without consequence. No one could stand
Nutburger’s personality and her approach to people. But since she was one of the more
experienced people on the team, everyone knew that management would not approach her about
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her attitude. Loco was seen as being incapable of effectively completing her job tasks. She was
protected by her friendship with Winters, who was also her boss. Johnson had no experience and
little to bring to the table. He did not work hard and made many mistakes. Team members knew
that the only reason he had been hired was because of who his father was. That kind of special
treatment for individuals added to the already-low level of trust within the team.
Meetings would regularly move off course and disintegrate into team arguments over
conflicting agendas. The individual nature of performance metrics caused team members to
focus more on personal achievement, as did Nettle, rather than achieving team goals. The
frustration between people who did not care for each other was getting harder and harder to
contain. At some point, the problems would need to be confronted head on. Team members who
do not like each other were unable to work effectively with each other over the long term.
Beyond the personal problems, there was also a lack of empowerment. Nettle wanted
perfection, but did not give the team the tools or the decision-making power to achieve its goals.
Many team members were afraid to make a decision, because of the consequences of making a
mistake. “It makes you work just hard enough not to get yelled at,” Ritchie said. “Team members
will defer all decisions to a higher level to avoid being reprimanded.”
Team Performance
Against all odds, the team was functioning at a very high level. One of the key metrics
was the average stock percentage at the 13,500 Burger Barn restaurants. This number had risen
from 90% to 98% during the two-year time frame that Nettle had been director. Many other key
metrics had improved as well. From a top-down view, everything looked great. The work was
getting done at a world-class level, and Nettle looked like a star as a result. In reality, it was the
pride and work ethic of individual team members that made the company successful. The
satisfaction in doing a good job often superseded the team’s personal problems, politics, and
unhappiness. But how long could that last before the team would begin to break?
Trouble on the Horizon
As time dragged on, team interactions continued to get worse. Normal business acumen
broke down, and team members began to lash out at one another. Haggard brought Nutburger to
tears on a number of occasions. Ritchie openly insulted Loco for her lack of ability. These kinds
of events became the rule as opposed to the exception. Swearing and insults were commonplace.
As the team further deteriorated, individual team members began to care less about their
employment with Initech. This manifested itself through blatant insubordination, lack of focus on
team success, and power plays against team leaders. The individual team members and their
subgroups began to undermine the efforts of Nettle in an attempt to destroy her credibility.
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It was rumored that many of the stronger performers on the team were actively looking
for other jobs. Three of the team members applied to top graduate business schools. With rumors
swirling, Nettle finally became concerned about the future. How would she continue to show
strong performance and make herself look good without the team intact? As a result, she went to
her boss and asked for help in solving the problem. Cash Jackson, Nettle’s boss, decided to step
in. Jackson began to brainstorm on what sorts of tools and techniques Nettle could use to analyze
the team’s dynamics as well as the individual team members. Time was of the essence, and
Jackson could not help but wonder what the future would bring.
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Exhibit 1
TEAM DYNAMICS AT INITECH
Initech Supply-Chain Operations Team Organizational Chart
Lynn Nettle
Director
Doug Jennings
Manager
Karmen Winters
Manager
Sharon Nutburger
Project Manager
Paul Trailerman
Systems Support
Dave Bon Jovi
Project Manager
Mark Haggard
Systems Support
Myron Smith
Planner
Tom Short
Planner
Cindy Walton
Planner
Ken Molany
Project Manager
Kim Loco
Planner
Steve Ritchie
Project Manager
Mike Johnson
Planner
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