|
|
Galvor Company founded in 1946, and had been an independently owned and operated French company by it’s founder, owner, and president M. Georges Latour. The company had acted as a fabricator, buying parts and assembling them into high quality, moderate-cost electric and electronic measuring and test equipment. Latour had always been personally involved in every detail of the firm’s operations as in most family owned businesses (signing important checks). Most growth was experienced in 1960 ($2.2M) – 1971 ($12M). On April 1, 1974, the company was sold to Universal Electric Company, a large, multinational organization with its European headquarters located in Geneva, Switzerland. The company headquarters was located in the U.S. The heart of UE’s reporting and control system was an extremely comprehensive and detailed business planning process. The approved business plan was the primary standard for evaluating the performance of unit managers and everything possible was done to give authority to the plan. One consequence of this system was a very strong centralized controller organization with a large staff as well as relatively large business unit controller staffs. This type of organization was necessary to support the needs of the business planning and reporting process. Galvor was struggling to adapt to the complex and time consuming requirements of UE’s business planning process. It was a relatively small business unit that had a very non-bureaucratic culture, developed over many years under the leadership of Latour (prior to UE’s purchase of the company). Latour personally took care of much of the business planning prior to 1974. UE’s planning system was not effective as it was applied to Galvor. It was a very inflexible, detailed system that required far too much time and too many resources for a business unit the size of Galvor. There are so many evidences of its ineffectiveness. For instance, Barsac (controller) and his chief accountant spent 80% of their time working the system, Reports did not provide value to the operating business unit, Boudry stated that the cost of the system was “barely acceptable” for a business unit the size of Galvor, Even though Galvor was experiencing problems with the system, according to Boudry, headquarters had not given Galvor the help it needed and deserved in data processing, and Telex exchanges from HQ staff to Hennessy provide no value to the operating unit.
|
