Case 10.1: Electrolux Cleans Up

1. How did Electrolux Chief Executive Straberg break down barriers between departments? Why did he do this?
Straberg had to make changes at Electrolux because the sales were seriously affected by their competition cheaper products, stock rate was hardly maintaining itself. Straberg had to make changes to save the company for it to starting gaining sales and profits again. Strasberg needed new products to be formed but not just with one department of design and others implementing the design but together as a team. Hence, one of the change that he initiated was to break the barriers between departments to enhance communication, enforce collaboration between functional areas. This helps departments to understand each others responsibilities and limitations hence overall work together to improve performance. For example, in the case we see designers want a smaller breeze and engineers point out that smaller Breeze would leave too little space for charging station. Traditional designers would just design something and others have to implement it somehow make it work. But breaking down the barriers they able to save time and money and able to make decisions together at once. To ensure the process of breaking the barriers works effective and fast Straberg recruited executives from companies with strong track record in innovation. Increased spending on R&D from 0.8 percent of sales to 1.2 percent. Producing products that are attractive with good features and consumers are willing to pay premium fro them without troubles.

2. What are the advantages for Electrolux of having individuals from different departments and functional ares work together on product design?
It saves time for example when they were all brainstorming, each personnel from different department is there and is able to do their duties in consideration of