Teaching Cases

Powerven: when it is imperative to change
Date Published: 2014
Published By: CLADEA-BALAS
Authors:María Helena Jaén, Roberto Montesinos, José Ramón Padilla
Product #: IE0001


Abstract

En 1998 Mikel Lizarralde, interpretando los cambios políticos que se avecinaban en Venezuela con la llegada al poder de Hugo Chávez, estaba convencido de que debía cambiar el modelo de negocios de su empresa para sobrevivir en los tiempos por venir. Era el Director de Powerven, una empresa propiedad de su familia, que representaba en su país los productos fabricados por la multinacional General Dynamics (GD). Para ese momento, la empresa estaba sufriendo serios problemas laborales: permanente clima conflictivo, baja productividad, fuga del personal técnico más capacitado y ausencia de identificación de los trabajadores con la empresa. Con apoyo de un asesor, Mikel desarrolló un programa de cambios cuya clave es la desvinculación de los trabajadores a Powerven para, posteriormente, organizarse en cooperativas y prestar servicios a la empresa desde un esquema comercial. 


Para adquirir este caso en español ingresa a: https://cb.hbsp.harvard.edu/cbmp/product/IE0001-PDF-SPA
 
Abstract
 
In 1998, Mikel Lizarralde, anticipating the political changes lying in store for Venezuela when Chávez took over Venezuela, realized he needed to change his company's business model if it were to survive in the new domestic scenario. He managed Powerven, his family's business, which marketed the multinational General Dynamics' (GD) products in Venezuela. At that time, the company faced severe labor issues, including an ongoing conflict-riddled atmosphere, low productivity, a drain of qualified technical personnel, and workers' lacking commitment. With the support of a consultant, Lizarralde developed a change program that hinged on laying off workers to build cooperatives that would later provide their services to Powerven on an outsourcing scheme. Lizarralde secured the approval of both GD and his father. He also managed to get the reluctant support of his siblings and to persuade Powerven's top executives in order to finally convince the workers. Taking a significant risk, Lizarralde chose Powerven's best-selling branch office to run a pilot test. This experiment proved successful, and Valencia's branch office quickly increased its sales while lowering its fixed costs. In addition, the members of the cooperative in charge also saw their income rise. The results had an immediate effect, and all of Powerven's 13 branch offices had adopted the new business scheme. However, by 2008, Lizarralde started to notice with concern a few clouds building up in Powerven's horizon. Cooperatives were not as cohesive as they should have. Additionally, some signs revealed that Chávez's administration no longer supported cooperatives as staunchly as in the past. In 2008, Lizarralde was tired and rather skeptical about his company's future. He knew he had to change gears once again, but he was unsure as to the best course to take. He wondered whether he should try to solve the problems plaguing cooperatives, revamp the company's business model or simply walk away.
 
 
To acquire this case in English go to this address: https://cb.hbsp.harvard.edu/cbmp/product/IE0003-PDF-ENG



Keywords: Adjustment; Management of enterprises; Organizational climate; Cooperatives; Electric industries
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