Instructions: • Read the case study carefully. • Answer the questions that follow in a separate document. • Please type your answers. • The expectation is about one complete paragraph per question amounting to roughly 1 to 1½ double-spaced pages in length. • When complete, please ensure that you upload your answers (include your name and a title in the document) to the relevant assignment submission folder. • Please note that I can only access files that end in .doc, .docx, .rtf, or .pdf. Please convert your document to one of those types if necessary.“L.L. Bean Changes Its Mind” A few years ago, outdoor-clothing retailer L.L. Bean Inc. began building a call center near Waterville, Maine. Then, in November, mobile-phone carrier T-Mobile USA Inc. said it would build its own call center next door. Within a week, Bean chief executive Christopher McCormick halted construction — literally stopping bulldozers in their tracks. A few weeks later, Bean said it would abandon the Waterville site; it ultimately chose to open the new call center in Bangor, about 55 miles away. McCormick wasn’t concerned about appearing wishy-washy. He simply wanted to make the best decision for the closely held Freeport, Maine retailer. A 23-year veteran who was named CEO in 2001, 50-year-old McCormick is the first chief executive from outside the founding family. Bean, which does much of its business through catalog telephone sales, opened a call center in an old Waterville shopping center in 1997. But the storefront was cramped and offered limited parking, so Bean executives in early 2004 began scouting for another site. By summer, they had settled on the FirstPark business center in nearby Oakland. Bean purchased the land, drew up the plans for a 50,000-square-foot office that could accommodate up to 800 workers and began grading the site. Then T-Mobile disclosed plans for a 77,000 square-foot center in FirstPark, housing 700 or more employees. McCormick says he worried immediately whether Waterville, a city of 16,000 had enough workers to supply both companies. He was especially concerned because much of Bean’s workforce is seasonal, peaking near the Christmas holidays. He feared that experienced call-center workers would prefer relatively stable year-round employment with T-Mobile, leaving Bean out in the cold. CRIT 1700 Scenario (Case Study) Analysis/Reflection, Page 2 of 2 Within days, he called a meeting of his top lieutenants and told them he wanted to stop work at FirstPark. “You want to do what?” he recalls one asking. “There were certainly some shocked looks.” It didn’t help that the reappraisal came at Bean’s busiest time of the year, when executives were already stretched thin to accommodate holiday sales. Moreover, McCormick wanted the new call center ready by the fall of 2005, then only about nine months away. McCormick says he has never before reversed such a significant decision. Beyond the land cost, Bean had already sunk more than $500,000 into plans and preliminary construction. But he also wanted to send a signal to other executives. “I want my people to consider all the options. I want objective decision-making,” he says. “I don’t want them to be a champion of one point of view.” Bean began searching for a new call-center site, employing the same real estate broker that had steered T-Mobile to FirstPark. By spring, Bean executives settled on a vacant office building in Bangor, where the city offered the company a break on the rent. When it came time to formally abandon the Waterville deal and commit to Bangor, McCormick says the Bean executive team agreed unanimously. In a disagreement with state officials, McCormick says he couldn’t take the chance on moving forward with the Waterville call center. “It was too risky to build this huge building” without more confidence about the potential labour supply. McCormick briefly considered locating the call center outside Maine. He says Bean could have saved money, but he rejected the move because Bean’s connection to the state is crucial to the company’s branding. ▪ [551 words]
Questions: 1. To what extent did Christopher McCormick use problem-solving and decision-making steps? 2. How will CEO McCormick know if he made a good decision? Identify some possible outcomes. 3. What is your opinion of the ethics of McCormick backing off on the deal to construct a call center in Waterville? Do ethics or morals apply in this type of decision-making?