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Case # 1: What's Wrong With Carl?

Eastern Tires Co. is having a managerial problem with its top management. In general, the company's executives feel that the president lacks leadership qualities and does not know how to get along with others.

Mr. Carl Lee and Bush Lee, brothers, established the company in 1963. The company manufactures tires and brake pads for bicycles. These products are marketed under the brand name of Steel-Rubber through bicycle dealers and service stalls in Hong Kong and China as replacement parts. They are still the principal shareholders. Mr. Carl Lee owns 51% of the outstanding common stock, and Mr. Bush Lee owns 19%. Through a perk package, six other employees, including two of the company executives, own the remaining stock.

Mr. Carl Lee is the president. Mr. Bush Lee is the treasurer in charge of all accounting matters including the payroll department. The company currently employs 225 workers on the production floors and 23 clerks in the management office.

During the years of his tenure as president, Mr. Carl Lee has displayed a philosophy of leadership which may have a negative impact on the management of Eastern Tires Co:

1. He has never considered the benefits but the costs. When Mr. Derick Au, the plant superintendent, has requested to install a computer for quality-control purposes in the plant. He has rejected the request simply because it costs too much.
2. He has never permitted worker grievances on the shop floor. He dismisses whoever files a complaint.
3. He has never provided a system for human resources suitable for promotions. There are no guidelines for promotion and further training.
4. He has never set the salary scale. He decides individual salaries based on his favorableness.
5. He has never provided a system of appraisal which is clear, informative, and equitable.
6. He has never planned ahead.
7. He has never utilized upward communication channels.
8. He has never reached a group decision with other directors. He always...