Case Analysis: Managing Pibrex Russia (A) New crisis, old grievances
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27 September 2014
An analysis of the case: Managing Pibrex Russia (A) New crisis, old grievances
Pibrex, a European leader in the production and development of polymers, faces the loss of its three Russian subsidiaries. This threat stems from issues encountered after entering the region in 1992 and then being hit with the Russian financial crisis of August 1998. As result, a steering committee comprised of three senior managers from Pibrex Region Europe North (PREN) exercised many anti-crisis initiatives including assigning newly appointed financial controller Elena Michailova with the task of auditing all three Pibrex Russian subsidiaries.
Upon completion of Michailova’s audit, she has discovered that it is the…show more content… There was a lack of communication and operational control for the management of Pibrex Russia.
5. Why was there was a lack of communication and operational control for the management of Pibrex Russia?
Pibrex used a decentralized structure worldwide. This structure was complicated and Russians did not easily adapt to it. Pibrex Region Europe North had many other subsidiaries besides Russia therefore issues in the Russian subsidiaries were often over looked. This limited progress and denied proper management of Pibrex Russia.
The root cause of Pibrex being in danger of losing is Russian subsidiaries is the use of a decentralized structure.
1. Go to a much more centralized structure that the Russians are more accustomed to
2. Restructure management my replacing all managers
3. PREN would focus more on the Russian subsidiaries
4. Drop all Russian subsidiaries and disperse production duties among other subsidiaries in PREN
1. Financial losses from the Russian subsidiaries must stop
2. Management should be more accessible and properly trained
3. Communication between managers and subordinates is key
4. Improve workforce morale
5. Increase efficiency
Pibrex needs Elena Michailova to take the job of financial and managing director of Pibrex KZ. I believe that her taking on both positions is the only scenario where Pibrex can keep the Russian subsidiaries and eventually make them profitable again.