Du Pont Down at the Plant

TABLE OF CONTENTS

Contents Page

I. Case Background 2

II. Company Background 5-6

A. Origins of the Company

B. Life Track of Company / Track Record

C. People Involved in the Company

III. Company Profile 9

IV. The Organization 10

A. Structure

B. Departmentalization/Chain of Command

C. Span of Control

D. Centralization-Decentralization

V. Leadership, Power, Politics 11

VI. Problems / Issues / Concerns 13

A. Areas for Consideration

B. Problem Statement

C. Objectives

VII. Relevant Theoretical Frameworks 14-21

A. Motivation and Leadership Style 14

B. Organizational Culture 15

1. Culture Functions 16

2. Creating and Sustaining Culture

3. Managing Cultural Change

C. Organizational Change 17

1. Complexity Theory 18

2. Chaos Theory

3. Self-Organization 19

4. Organizational Development 20

5. Creating a Learning Organization

6. Managing Learning 21

D. Corporate Social Responsibility

VIII. Alternative Courses of Action 23

IX. Best Alternative Chosen 27

X. Action Steps 28

XI. Conclusion and Recommendation 29

XII. References 30

I. CASE BACKGROUND

With the abundance of water, cheap coal, and salt springs in the small town of Belle, a

huge DuPont chemical plant was established there in 1926. It was the first

syntheticammonia

facility in the US and the first producer of commercial nylon intermediates. In the 50-60

years since then, Belle’s citizens have been living with the sight of large storage tanks and

a manufacturing plant with unpleasant odors emanating from its facilities. As a result,

people of Belle have been caught in the middle of being thankful for the jobs that Belle has

generated and l a growing resentment for the adverse impact of the plant on their daily

lives.

Suspicion and distrust of the plant and its managers, fear of a disastrous event that

couldthreaten the citizens’ lives and the lack of care from Belle’s plant managers, have

added to the resentment of Belle’s people by 1987. The relationship between the town and

the plant was worsening as the odors coming from the plant caused increasing concerns.

Parts of the plant were very old and in a state of deterioration, physically and psychology.

With the obsolete equipment and inefficient, wasteful manufacturing operations, the need

for major overhaul was critical to address various quality and cost considerations. The

plant was also facing the need to reduce the number of employees increasing the

frustration of people and widening the gap between management and the town. Accidents

and injuries had also escalated beyond The DuPont Company’s standards. Management’s

relationship with the community, and to its economic and social environment seemed

quite indifferent, . Because of all these, the executives of the DuPont’s head office in

Delaware had become dubious of the ability of Belle’s management to deliver the needed

results and so everybody feared that the plant could close down in the near future. Dick

Knowles was transferred to the plant manager assignment from Niagara Falls, New York to

Belle, West Virginia. Partly because of Claire’s positive impact on him, Dick has

undergone a significant transformation in his personal life and management style that

extended to his experience in the new plant manager assignment in Belle . Moving from a

command and control approach to management, using bad language and sometimes

demeaning people to get things done, Dick developed and used a new management style

for Belle Plant, which was based on complexity theory: emphasizing valuing people for

themselves, attending to relationships, trimming down hierarchy and participating with

everyone in the communications. The results were noteworthy. Injury rates were down by

95 percent. Environmental emissions were reduced by more than 87 per cent. Up-time of

the plant increased from an average of 65 percent to 90-95 percent.

Productivity increased by 45 percent and earnings per employee tripled. Aside from these

very obvious successes in terms of quantitative results, there has been a significant positive

change in the relationships of employees and management in the plant and with the

community around Belle. Though the new style of management was energizing,

stimulating and fun, there were several times during the transition that Dick felt somehow

scared and unsure about whether they are on the right track. There were many times that he

struggled with the temptation of falling back to the comfort and safety of the old command

structures, especially because he was not sure about how to keep things in control and not

to lose focus with the new style of management. He did not want to issue directives and

dictate how to achieve the results and desired outcomes.

The following were the other actions taken by Dick at Belle:

• Creation of genuine teams including management teams that allowed participative

communication, decision making, problem solving and brainstorming for continuous

improvement

• With the Leadership Team they established of a list of “treatment-of-people principles”

that management had promoted and had to live by. These were issued to everyone and the

Leadership Team people asked everyone to help them live up to them. In responding to this

invitation, the “treatment-of-people principles were rapidly adopted across the plant.

The Treatment of People Principles are as follows:

‰ People want interesting work.

‰ People want opportunity for learning and growth.

‰ People can be trained.

‰ People want equal opportunities at work.

‰ People want responsibility in their work.

‰ People “want in” on decisions that affect them.

‰ People expect management to lead not abdicate.

‰ People expect a leadership team to be consistent and predictable.

‰ People want to be part of a winning team.

‰ People want to know what’s going on at Belle- in the department and in the

company.

‰ People want to be informed.

‰ People want fair pay and knowledge about how the pay system works

‰ People have a need to relate to others in the job.

‰ People want rational rules.

‰ People want to be treated like people- people have ego needs.

• Flattening the organization and giving more decision making and control to people

working in the plant.

After Dick’s stay at Belle, the results were noteworthy. Injury rates were down by 95

percent. Environmental emissions were reduced by more than 87 per cent. Up-time of the

plant increased from an average of 65 percent to 90-95 percent. Productivity increased by

45 percent and Earnings per employee tripled. Aside from these very obvious successes in

terms of quantitative results, there has been a significant positive change in the

relationships of employees and management in the plant and the relationship of

management with the community around Belle. Thirteen years later the plant is smaller

and still profitable.

Figure 3 DuPont, Belle Plant

II. COMPANY BACKGROUND

A. Origins of the company

E. I. du Pont de Nemours and Company, an American chemical company, was founded in

July 1802 as a gunpowder mill by Eleuthere Irenee du Pont. E.I. du Pont used capital

raised in France and imported gunpowder machinery from France. The company was

started at the Eleutherian Mills, on the Brandywine Creek, near Wilmington, Delaware,

USA two years after he and his family left France to escape the French Revolution. Du

Pont noticed that the industry of gunpowder manufacturing in North America was lagging

behind Europe, and saw a market for it. The business grew rapidly, and by the mid 19th

century became the largest supplier of gunpowder to the United States military. DuPont

continued to expand as decades went by having the greatgrandsons of E.I. du Pont manage

the business. It subsequently began to purchase several smaller chemical companies which

built their dominance in the explosives business.

B. The Life Track of the Company / Track Record

In 1902 to 1912, DuPont moved into the production of dynamite and smokeless powder. It

established two of the first industrial laboratories in the United States, where they began

the work on cellulose chemistry, lacquers and other non-explosive products. DuPont

Central Research was established at the DuPont Experimental Station across the

Brandywine Creek from the original powder mills. In 1914, DuPont would assist the

struggling General Motors, an automobile company, by buying GM stock at $25 million.

Under DuPont’s support, GM became the leader in the automobile industry by 1920. In the

1920’s, DuPont invented and manufactured neoprene—the first synthetic rubber—and the

first polyester super polymer. In 1935, it first introduced the chemical phenothiazine as

insecticide, and nylon. During the World War II, DuPont continued to be a major producer

of war supplies. It helped produce the raw materials for parachutes, powder bags, and tires.

In the post WWII, DuPont continued to introduce new materials and develop military

paraphernalia such as the modern body armor, Flak jackets, etc. In 1981, DuPont acquired

Conoco Inc., a major American oil and gas producing company that gave it a secure source

of petroleum feed stocks needed for the manufacturing of many of its fiber and plastics

products. This placed DuPont in the top ten U.S.-based petroleum and natural gas

producers and refiners.

In 1999, DuPont sold all of its Conoco shares, shifting the company’s focus towards

producing DuPont chemicals from living plants rather than processing them

from petroleum. In 2004, the company sold its textile business, which included some of its

bestknown brands such as Lycra Spandex, Dacron polyester, Orlon acrylic, Anton nylon

and

Thermolite, to Koch Industries.

In 2005, DuPont ranked 66th in the Fortune 500 on the strength of nearly $28 billion in

revenues and $1.8 billion in profits. DuPont businesses are now organized into five

categories: Electronic and Communication Technologies, Performance Materials, Coatings

and Color Technologies, Safety and Protection, and Agriculture and Nutrition. DuPont had