Why Mattel’s managers were able to
slowly change decision making over time.
Mattel
launched Barbie was 1960, and was doing exemplary in the market. Parents
preferred Barbie over other dolls for their children because it had an ideal
women image. Over time, the sale of Barbie became stagnant as the taste and
preferences of customers changed. With
an advancing world, Barbie’s market cultural views took a paradigm shift. People began holding different views towards
occupation, the role of girls and other related factors.
On the other hand, managers at Barbie were
contented with the profit they were making out of Barbie and resisted the urge
to alter the product. They thought that making changes would alter the
appearance of the doll which would impact the sale of the product. They did not
realize that by failing to change the design of the doll to suit customers’
taste and preference, it risked losing its best seller position in the market.
As
a result, the managers were unprepared when a new kind of doll, the Bratz doll,
was introduced in the market (Nash & Duvall, 2005).Many competitors to
Barbie had surfaced over the years since the doll business was viewed as
profitable; however, no other doll had matched Barbie’s appeal to young girls.
Mattel was unprepared for this type of trouble. As a result, strategic managers
were forced to change its strategies and business model to bring Barbie up to
date.
What kinds of cognitive errors
contributed?
The
most obvious cognitive error that faced Barbie lied in its product innovation.
Product innovation was inconsistent, and the business failed to keep pace with
changes in its market. Mattel’s designers should have been adventurous and made
more radical changes earlier. The rapid changes in the market required
strategic managers to speed up their decision making. However, they got left
behind by agile competitors who act in response to shifting customer
preferences (McNamara & Bromiley 1997). Barbie’s advantage as best-selling
global doll overturned as managers made major strategic errors in the 2000s.
Factors related to organizational
culture and innovation that influenced Mattel to move in a more positive
direction.
Organizational
culture comprises a set of shared values and norms that influence how the
entity’s members’ behave and interact with others. An organization’s culture can be detrimental
as it was the case with Mattel. Mattel’s culture was characterized by the
reluctance to change with the environment. Their lack of focus on market
factors and control mentality hindered innovation and caused their company to
lose traction in the doll market. Managers had an illusion of control which
contributed to Mattel’s sluggishness in its decision-making process. An
Illusion of control contributed to the behavior of overestimating the extent of
managers’ control over a situation.
Managers in the organization were overconfident in the sustained success
of the Barbie doll (Nash & Duvall, 2005). The confidence was based on the
past success. As a result, they refused to acknowledge considerable changes
within the environment. They
overestimated the organization’s ability to continue to outdo competitors and
did not have a plan for the situation such as the introduction of the Bratz
doll. Mattel reacted after the drop in
sales due to the success of competitor doll. In the absence of the culture,
managers at Mattel would have been able to make more careful and well-planned
decisions in reaction to market forces.
References
McNamara G. & Bromiley P. (1997). Decision
making in an organizational setting: cognitive and organizational influences on
risk assessment in commercial lending. Academy of Management JournaJ 17. 1997
Vol. 40, No. 5. 1063-108
Nash
& Duvall (2005). How Barbie Lost her Groove
Carolyn Morgan is the author of this paper. A senior editor at MeldaResearch.Com in research paper writing services if you need a similar paper you can place your order from Top American Writing Services.
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