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RST Carports and Metal Roofing
In 1980 RST Carports was founded as a small business in the Midwest. The
company grew through the years, producing four versions of carports to eventually forty-
eight versions. The company was profitable from the year 1981 to 2017 but in 2017 the
President Jerry Jones decided to sell the company to WXY Corporation. A new divisional
manager was elected to replace Jerry Jones, his name is Art Anderson. Anderson began to
make drastic changes to the company by cutting employees, combining roles, reducing
training and in the end losing profit and vital management. From 2017 to 2020 the company’s
profit dropped from $10.9 million to $2.3 million. With the loss of profits also came an
increase in employee accidents, increase in overtime for both employees and management,
and a huge loss in quality. The CEO has initiated a work project with W2 Solutions
Consulting Company to do an analysis to see what has caused the negative events within the
company and to recommend what is next to build the company back to where it once was.
Experience Levels of Employees
Between 1980 and 2017 RST Manufacturing had eight employees who were in
managerial positions with 37 years’ experience with the company. Those eight employees all
possessed a democratic management decision style. Along with the eight, RST
Manufacturing had six employees with 5 to 30 years of experience, and they also had a
democratic management decision style. The data provided showed the lack of experience
with the company in the employees who moved in when the company was bought by WXY
Corporation. Major employees in management including the CFO, the quality manager, the
engineering manager, and the purchasing manager lack years of experience compared to the
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previous managers. After the buyout, one of the biggest challenges faced by RST was that
there was a great lack of managerial experience and employees with lower ranks. The new
leadership consisted of seven employees; four with two or less years of experience, two with
three years’ experience and only one with 16 years of experience who was the IT manager.
The seven employees all had various management decision styles.
The loss of experience that came with the buyout is likely to be what caused the major
dramatic reversal in company performance and loss of profits. Except for the Human
Resources Manager and the Purchasing Manager replacements, the experience average of the
managers before the buyout was 31 years of experience. The new managers who came in
only averaged three years of experience. The new acquisition changed the way new
employees are trained into their positions and roles. The former 48-hour annual training
session were cut to only two hours of training that consisted of diversity and sexual
harassment lessons. The lack of training for employees who already lacked experience is a
reason as to why the company felt such a great loss.
How Leadership Styles Could Have Affected the Change at RST
The change in leadership is likely to have played a huge part in the loss of profit and
employees in the buyout of RST to WXY. The data provided gave a clear view of the
leadership styles for the original employees and the new employees. The current set of
leadership, with the exception of the CFO/HR manager are considered a transactional
leadership style while the original leadership were a mix of leadership styles with majority of
them being transformational. For example, the original president of the RST, Jerry Jones,
possessed a servant leadership style. According to Science Direct, servant leadership
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acknowledges the importance of being authentic and true in one’s interaction with others -
servant leaders have the prosperity to operate with a deep clarity of self-awareness and self-
regulation. The article continues stating “servant leaders are authentic not for the sake of
being authentic, but because they are driven either by a sense of higher calling or inner
conviction to serve and make a positive difference for others.” (Eva, 2019) As a servant
leader, management would see leadership as a chance to serve others, share power and
control to drive engagement, measure success through growth, listen, and understand that it is
not all about them. Employees who work under a servant leader are more likely to have
greater levels of confidence, feel safe at work, feel the urge to prosper, and hold tough
conversations. The new leader, Art Anderson leads under a transactional leadership style.
Leaders who lead with a transactional leadership style use a structured system of rewards and
punishment, uphold the status quo, closely monitor employees’ work, solicit minimal
employee input, and require their employees to work to an established set of rules.
The sudden change employees faced in leadership styles of their management would have
impacted how they felt at work. The majority of their original managers lead as a
transformational leadership style while the new one mostly leads as a transactional leadership
style. The employees went from working with leaders who were mostly focused on vision,
enthusiasm, and who were proactive, to leaders who are primarily focused on goals, rewards,
and punishments, and are reactive. The change in leaderships are certainly quite opposite
which led to the loss of employees and profit.
How Management Decision Styles Could Have Affected the Change at RST
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Just as leadership styles, there was a drastic change in management decision styles from
the original management and the current management. The original management consisted of
all democratic management decision styles. Democratic leaders distribute responsibility,
empower subordinates, and include them in the decision-making process - in other words
democratic leaders employ an egalitarian approach or a leader who believes that all people
are equal and deserve equal rights and opportunities. (Caillier, 2020) The majority of the
current leadership has an autocratic management decision style. Autocratic and democratic
management decision styles are complete opposite types of management styles. Autocratic
leaders work in a more authoritarian style and will often make decisions on self-interests and
can be viewed as negative and not accepted by employees. Only one leader in the current
leadership had a democratic view in management decision styles. This style change
significantly changed how management made decisions within the company beginning with
requiring more working hours, changing, and lessening training sessions, and consolidating
roles within the company. According to the Worker Overtime sheet provided, employees
working overtime jumped; the number of hours increased by more than half. Between 2016
when the original leadership was in charge to 2020 when the current leadership was in charge
the hours worked overtime increased by just under 50 hours to over 350 hours. This change
in leadership styles could set a negative work environment especially since in an autocratic
management environment there is no feedback taken from employees. In the change from
democratic to autocratic leadership, employees are given no extra incentives or praise,
leading to poor employee productivity like in the data given. The types of management
changes that occurred led to more work accidents and a decline in profit, and quality.
How Types of Power Could Have Affected the Change at RST
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According to the Satterlee text, referent power is considered to be more influential than
any other power type along with expert power. (Satterlee, 2018) The majority of the old
leadership worked under a power type of expert. Expert power comes from the type of
experience, skills, and knowledge someone has. As employees gain experience and climb in
their role, they begin to gain expert knowledge. The majority of the new leadership works
under the coercive power type. Management under this power type typically obtain their
power through fear. Whether the fear is threatening to take away one’s job, be given a pay
cut, or have tasks and authority taken away. With the new leadership practicing under mostly
a coercive power, employees are based simply off of their performance with the thought in
mind that there is a reward at the end. On the other hand, the previous leadership worked
with employees by training them and encouraging them to learn in order to be better in their
role. Before 2017 when RST was bought out, no one in management worked in a coercive
power type. The CEO worked under a referent power type, meaning he was the head of the
company but was well trusted and respected. The referent power type is something earned
and built over time and is gained by how someone oversees situations and other people.
(Rao, 2020) The change in management brought in new leadership such as the president, and
operations manager who worked with the coercive power type meaning there could have
been several changes in punishments, resulting in a prominent level of resentment among
other employees. This change could have caused the decline in employees when multiple
employees quit and or retired. The case study explained how there was a huge decline in
experience in leadership and there were reductions in the employee numbers and the new
employees were a continuing revolving door. The loss of expert and referent power could
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have been what caused the company to lose quality, profit, and see an increase in negative
workplace events.
A Pareto Analysis of the Three Main Problems That Could Have Affected the Change at
RST
Based on an 80/20 Pareto Analysis, the method is used for decision making in a corporate
and business affair. The technique divides a small amount of input variables that have the
greatest effect on an outcome (Bajaj, 2018) The technique, Pareto Analysis is used on the
notion that 20 percent of work will produce 80 percent of the gain of a work project or
adversely, 80 percent of the issues are from 20 percent of the causes.
The Pareto Analysis uses profit values that are calculated from using the data from profit,
quality, management and employee overtime, and the accidents that occurred. This is used to
determine which problems were what caused the huge loss of profit when the company was
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bought out. Based on the data given, the three problems that affected the change at RST were
the rejections, employee accidents, and the amount of overtime. The employee accidents and
rejections had a huge negative impact on the company and their profit due to the waste in
product and time. The huge amount of overtime hours worked by both the employees and
management also played a part in the decline of the organization and profit.
Recommendations
The Pareto Analysis shows that after the buy out the rise in rejects, worker overtime, and
the number of accidents over three years has the greatest impact in the loss of profits. The
three main effects are also primarily associated with the employees and not the management,
so the company needs to hire and train more employees and add more managers so there is
an equal amount for each division. One of the major changes that needs to be made is the
change in leadership. The managers who can work with expert power need to be made higher
in leadership and need to work together to see how the profits were being lost. The expert
leaders can work together to bring back more in-depth training for new hires and the 48-hour
annual training to help reduce accidents and rejects. Another recommendation is to have
leadership incorporate more leaders who possess a transformational leadership style. When
RST was under the original leadership, six out of fourteen leaders were transformational style
leaders. One of the biggest downfalls the current management is facing is the turnover and
revolving door of new hires. Transformational leaders can still require overtime but can
incorporate a workspace that is caring and invests in the employees in return for working
more hours.
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Biblical Integration
There are multiple stories in the Bible about failure. Everyone faced a failure, and at
some point, everyone was failed by someone else. Jesus was the most failed person in the
Bible. He faced more disappointment and failure than anyone else. Jesus was crucified and
failed by the leaders of his day, just as today employees can be failed by their leaders when
they trust them most. RST faced a change that led to the loss of employees, expert managers,
and profit because the leadership brought in was not the best fit at the time. When there are
failures in the workplace, it is important to remember we have a leader who stands for
everyone at the end, Jesus died for us, he is our almighty leader who is true.
Peter 5:2-3 states “Be shepherds of God's flock that is under your care, watching over
them—not because you must, but because you are willing, as God wants you to be not
pursuing dishonest gain, but eager to serve; not lording it over those entrusted to you, but
being examples to the flock.” Although the new management has leadership, management,
and power styles that are different than before, they need to compromise to keep their
employees. The employees are coming from a company that had leaders whose styles were
respectful, expert, accommodating, and listened to their employees. The new leaders need to
lead for the goal of making more profit, but also to build a team that works and loves
together.
Conclusion
The RST case study is a fitting example of how leadership styles, management decision
styles, and power styles matter within management. The previous leaders of RST had a
profitable company with leaders who were respectful and respected and led a company that
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grew dramatically over 30 years. The new leadership within RST has the ability to turn
things around and gain more profit but they have to be vulnerable and wise with their
decisions from here on out.
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References
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Caillier, J. G. (2020, February 24). Leadership, and Public Service Motivation on Citizen Ratings of An
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https://www-tandfonline-com.ezproxy.liberty.edu/doi/full/10.1080/15309576.2020.1730919
Eva, N. (2019, January 17). ...Servant Leadership: A systematic review and call for future research.
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King James Bible, (1988). The King James Study Bible: King James Version. Thomas Nelson
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