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Case Study: “John Smith and Lillyvanian Systems”

Case Study: “John Smith and Lillyvanian Systems”

Carolina Guerrero, Psyd Leadership Psychology Student.

LP 762 The Psychology of Leadership and Followership

Dr. Dan Jacobs Fall Semester 2019

William James Colleges

October 12, 2019.

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Case Study: “John Smith and Lillyvanian Systems”
Introduction:

Lillyvanian Systems (also known as LS) was a “large multi-national corporation with 29

subsidiaries involved in operations in almost twice as many countries.” The founder of

LS, was Nathan Smith, the grandfather of John Smith the actual Chief Executive Officer

(CEO). The company had been doing quite well financially in the past 50 plus years, but

there had been some major shifts in revenue generation that John Smith had raised

questions about the direction the company could, or should, be going next. In

consequence, we have been assigned as a consultant to help the company and leaders to

go through the challenging decision process of where to go next.

Within LS organization, several problems can be encompassed in a single concept, the

management of resources: financial, technological and human. The most important of all

is the human because this is the one that produces and the one that operates the

technology and take the decisions. In other words, you can have the best technology on

the market but if the staff who operate it is not well-trained enough, there is no clear idea

of the goal you want to reach and in addition the person who leads it does not employ a

leadership style that commensurate with the activity that is carried out, it would not do

much good. All of this could result in low innovation and poor competitiveness. The goal

of this consultation should be focused on the use of LS resources for “total productivity”

using the frame technique REBT, Albert Ellis 1956, to “help their clients to live the most

self-fulfilling, creative, and emotionally satisfying lives by teaching them to organize and

discipline their thinking.”

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Case Study: “John Smith and Lillyvanian Systems”
Background history and context:

To understand how LS got to this point, we should know more about the history and

development of this company, following (Lewin, 1947) observations that “behavior is a

function of person and environment… cannot be fully understood without consideration

of the situation in which the person or persons are embedded.”[1] LS originally called

“Lillyvanian Cables”, was founded back in the 1940s in a small country in central Europe

after World War II. First, the company had dedicated to doing some masonry renovation

on damaged buildings and then just supplied cable and wire to local municipal. The

organization becomes a specialist in cables and electrical wiring expanding his workforce

and revenue considerably. The installation services increased with the upgrade of all-

electric and technological services of the country and Nathan Smith saw another

opportunity, there was a need for additional services in public works projects.

He, and his brother Alan Smith, created a new division of the company, using innovation

from the earliest stages of the company as “the intentional introduction and application

within… to significantly benefit the individual, the group, organization or wider

society”1. Consequently other divisions were created later, “Lillyvanian Construction”

designed to provide the workforce to dig the trenches, install the cables and also build up

infrastructure. “Lillyvanian Cement and Concrete,” “Lillyvanian Construction

Equipment Rental,” “Lillyvanian Manufacturing” “Lillyvanian Payroll Services”. The

strategy was also designed to maximize profits creating the products they need for their

operations directly and cut the external suppliers, which allowed them to save money and

1
Rosing, K., Frese, M. & Bausch, A. (2011). Explaining the heterogeneity of the leadership-innovation relationship:
Ambidextrous leadership. The Leadership Quarterly, 22(5), 956-974.


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Case Study: “John Smith and Lillyvanian Systems”
win with success in the construction all over Lyllivanian and Western Europe. In 1963

the company was renamed “Lyllivian Systems”, and all the Lyllivian Systems projects,

machines and branding promoted this name as well as the company’s logo “LS”.

LS Culture

LS culture continued to support internal promotions of qualified candidates when

possible, following the organizational culture of respect2, but the rapid growth did result

in hiring workers and managers from other companies by necessity. LS continued to have

a strong reputation with workers in different parts of the world as a “hard but good place

to work”, or also interpreted as a place where it was valued the culture of

aggressiveness3. There was pride when someone was able to say they worked for LS, it

was also present a culture of team orientation4. The growth in the company also led to

elevated standards of living for those in the town of Gallifrey. This growth and progress

spread directly and indirectly into other areas of Lillyvanian society and LS was seen as a

valued partner to Lillyvanian politicians, educators and business representatives. LS

were known globally for his strong culture of innovation5 that helped the town to grow.

LS second generation Smith, George.

By 1989 Nathan and Alan were only involved peripherally and Geroge Smith was

running the company. LS also developed different divisions that specialized in building

2
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.
3
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.
4
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.
5
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.

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Case Study: “John Smith and Lillyvanian Systems”
power plants, establishing light rail vehicle tracks and tram-systems, facilitating urban

renewal planning and implementation projects, and even explored usages for alternative

energies (solar and wind power) but with limited success. Gross revenues for LS in 1994

were double those of the company in 1980. George was known as “just plain tough” by

those under him. He was very focused on growth and profits and wanted LS to be “as

successful as we can hope to be”, he was a leader with simplistic messages, as Burns

(1987) mention, “Leaders who appeal to followers with simplistic slogans such as

Equality, Progress… they are seeking the widest possible consensus..,”6; but he still

worked very hard to grow the company in an “organic manner,” exploring any and all

options related to construction and urban planning. As George became more comfortable

in his role as CEO, and with the support of his board of directors, as (Carson et al., 2007)

mention as share leadership “may be more effective when the team life cycle promotes

the development of shared leadership”7, George did put in place a number of initiatives

that were seen as risky at first but later paid off to add great value to the larger company.

LS third generation Smith, John.

John Smith was born in 1966, (son of George and Kara Smith) earned a Bachelors of

Science, and then a Masters of Science, in Mechanical Engineering. He began working

for LS Power plant Construction in the engineering department, and move to LS

Manufacturing division where he worked for two years and put in for 5 patents related to

technologies that he developed. John Smith by 1990’s had trained and worked in every

6
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.
7
Dansereau, F., Seitz, S., Chiu, C., Shaughnessy, B. & Yammarino, F. (2013). What makes leadership, leadership?
Using self-expansion theory to integrate traditional and contemporary approaches. The Leadership Quarterly, 24,
798-821.

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Case Study: “John Smith and Lillyvanian Systems”
division at the company (Construction; Manufacturing; Consulting, Sales & Marketing;

and Service Industries) but as he moved up the corporate ladder he felt the company was

“too tied to the way this company used to be, not the way it can be.” John Smith

possessed the Self-actualization talent. “…the capacity to perceive the needs of followers

in relationship to their own, to help followers move toward a fuller self-realization and

self-actualization along with the leaders themselves.”8 (Burns 1987).

John felt one reason for limitations or frustrations at LS was linked to a lack of fluidity to

get new information or new changes put in place. He was promoted to a vice president

role in the Service Industries division in 1996, and from 1995 to 2007 LS continued to

expand considerably on an international scale. John put together a formal proposal and he

was given the chance to create, coordinate, and lead the LS “2000 and Beyond team

committee.” to bring the company to his optimal future development. John unconsciously

was following the premises of Transformational leadership “…whatever the separate

interests persons might hold, they are presently or potentially united in the pursuit of

“higher” goals, the realization of which is tested by the achievement of significant change

that represents the collective or pooled interests of leaders and followers.”9–Burns

The 2000 Beyond Committee-till 2007: The key relationship with employees.

During the leading of the 2000 Beyond Committee with John as the president, a lot of

questionnaires, surveys, and divisions were made to considerer all the information and

feedbacks the whole organization and their employees could provide. John did find a

close ally in the human resources division, Zoe Serra, who was very good at connecting

8
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.
9
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

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Case Study: “John Smith and Lillyvanian Systems”
with people and he relied heavily on her, and Washburne his assistant chair, to help him

gather “the right people with the right ideas.” As we can see, John unconsciously was

getting closer to the use of Ambidextrous Leadership style “The requirement of

ambidexterity in the innovation process implies that individuals working in an innovation

context need to both explore and exploit, and switch between those two activities”10

(Rosing, K., et al., 2011).

By early 2001 the “2000+” made a series of presentations in each of the divisions in the

company and after some refinement the LS Board of Directors met to consider all of the

committee’s recommendations. Over the course of 2002 LS officially put all of the

structural division changes in place and there was a mandate from top management

directly involved in the transition “to not layoff any employee from a redundant

subdivision if at all possible. He or she might lose their role in a specific part of the

company but not a job at LS itself, and any LS employee who expressed an interest in

retraining or transferring was given the opportunity.” As we can see the leaders of LS

were transforming hopes in sanctioned expectations.” Leaders can, in turn, help convert

hopes and aspirations into sanctioned expectations”11 reinforcing the trust and team

orientation values throughout the changes.

Not all employees responded positively to the changes and there were fledgling efforts to

create union groups at those divisions, but nothing came of these efforts and the vast

majority of LS employees felt “pretty much ok with all of the change”, thanks to all of

the great communication from the management about changes as they happened as much

10
Rosing, K., Frese, M. & Bausch, A. (2011). Explaining the heterogeneity of the leadership-innovation relationship:
Ambidextrous leadership. The Leadership Quarterly, 22(5), 956-974.

11
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

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Case Study: “John Smith and Lillyvanian Systems”
in advance as possible. Here we can see how important was for John and LS the

satisfaction of the employees needs and how they consider them constantly during the

change process, following these premise “As the expression of needs becomes more

purposeful… as it becomes more related to socially sanctioned aims and collective goals

and values—leaders help transform followers’ needs into positive hopes and aspirations.

“12-Burns (1978)

John Smith as the CEO and the new needs for consultation:

John Smith did quite well in the role of President of Lillyvanian Systems from 2002 to

2007, with his primary focus being on the transition to the new division structure and

coordinating communication and strategy between each of the division. In 2007 Malcolm

Reynolds chose to retire earlier than expected due to health reasons, and John Smith was

elevated to the Chief Executive Officer position and Zoe Serra, who had grown LS

Lifestyle Brands into a division, was asked to be the new President at LS and she

accepted.

Overall, things for LS, and for CEO John Smith had gone quite well from the time he

took over leadership of the company. He had developed strong and positive relationships

with his board of directors, with his management team, and with key governmental and

business partners. But as growth in the LS Lifestyle Brands and in the LS Technologies

divisions grew John Smith kept wondering about whether there were even more

opportunities that would help LS grow, opportunities that “we have just not thought about

yet.”

12
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

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Case Study: “John Smith and Lillyvanian Systems”
It was also in evidence the need for changes, when LS Technologies put forth proposals

to develop “LS Future Space” and “LS Innovations,” two subdivisions focused on

research and development, that functioned without a clear mandate for two years. LS

employees who worked at those subdivisions were encouraged to “think so outside the

box you don’t even remember what a box is” and the division made a major investment

in hiring the best creative innovators from within the company and from around the

world. John this time wanted to consider cultural values and follower behaviors that were

oriented to individualism mentality to build-in the new divisions. “In Individualism,

where independency and autonomy gain prominence, the managers would want their

subordinates to act more independently from themselves and to think critically.”13

At this point John Smith realized that what had started as intent to find new ideas for use

at LS, could have actually created the change for the whole structure and identity of LS.

In consequence he had a lot to consider deciding where to go next… John’s following

questionings:

 Should he give plenty support to LS Future Space and LS Innovations proposals? Both

had unproven track records, both offered proposals that were very high risk, but they also

could prove to be the “next big things” in the worlds of high tech applications. They

needed a quick action before could be too late and some of his competitors could take

advantage of it but also if incorrect could be potentially catastrophic.

 How this would impact the rest of the company in both the present and in the long-term?

 How such a change could modify the identity of the company his grandfather started?

13
Can, A. & Aktas, M. (2012). Cultural values and followership style preferences. Procedia-Social and Behavioral
Sciences, 41, 84-91.

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Case Study: “John Smith and Lillyvanian Systems”
 How to maintain a goal-aligned increasing revenue generation, preserving the goals and

mission of LS?

 What kind of repercussions internally and externally could the change develop?

 How to go forward to make an impact in the market, being sure that it won’t hurt the

company?

 What he supposed to do now?”

Gathering info-Consultations Questions:

Framed in the statement of the consultation problem, and seeking to determine what

activities are carried out by the organization at the internal level, which decisions

determine their action, as well as what perspective the social body has with regard to the

environment, the human resources and other factors that determine their reality and

behavior; understanding the organizational state of the internal dynamics of the company,

steps are given to state the consultation question:

What is the organizational state of the Lillyvanian Systems that stands out from the

leadership at the level of their internal dynamics?

Focusing on answering questions regarding:

a) The strategic orientation of the leading of LS organization.

b) The organization dynamics and strategic orientation

c) The characteristics of the organizational structure of the outstanding LS.

d) The planning and management of the internal processes of the leading LS

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Case Study: “John Smith and Lillyvanian Systems”
e) The presence and interest with respect to shared values and culture in the leading

Lillyvanian Systems.

Analysis of the information:

a. The Strategic orientation of the leading of LS organization: LS was responsive to the

context needs from his origins with Nathan Smith, his leadership orientation was reactive

to the needs of his context as the interactional psychology paradigm displays, “is

specially salient for understanding the context surrounding leadership; quite simply put,

context constrains what behaviors are considered prototypical…The ‘stronger’ the

situation, the more salient norms are that guide behaviors…Important to note is that not

only do individuals do as the situation demands they should, but they have, in the first

instance selected those environments and are active players in shaping them…particularly

when they are leaders…”14 , this is what Nathan Smith did, assessed the need of the

context and shaped his business behaviors to respond accordantly. With George Smith

the leadership orientation was focused on keeping the company growing maintaining

what was already made, focusing in growing and profits, following a transactional

leadership orientation. “The object in these cases is not a joint effort for persons with

common aims acting for the collective interests of followers but a bargain to aid the

individual interests of persons or groups going their separate ways.”15 –Burns (1978)

It was only with John Smith that the organization opened to new horizons following a

transformative leadership style. Where the main concern was listening to the feedbacks

14
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.
15
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

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Case Study: “John Smith and Lillyvanian Systems”
of their employees, as for John non one will know better what the company needed to

grow that his own members. John valued the perspective, emotions, and new ideas of the

members of LS organization before of any other external information or consultant’s

feedback. We can know this referring to what say several times, “We can do that

ourselves but only if we really listen. To everyone who wants to have a voice.” John was

focus on listening and responding to the feedback of his employees, that is why he

processed several questionnaires’ to have a more clear consent on where the company

could grow next following the transformational premises “The premise of leadership is

that, whatever the separate interests persons might hold, they are presently or potentially

united in the pursuit of “higher” goals, the realization of which is tested by the

achievement of significant change that represents the collective or pooled interests of

leaders and followers.”16–Burns (1978) John was a transformational leader, a moral

exemplar and work ethic toward the benefits of the whole organization.

b. Organization Dynamics and Strategic orientation:

The strategic orientation putted in place with “2000 and Beyond” was the creation of

subcommittees and ad hoc groups tasked with specific assignments that involved front

line LS employees. John Smith was looking for efficiency of the process of asking

everyone at LS about where LS could be going, he was focus on orient the organization

depending on their own employee’s feedback. John valued the strategic orientation of

independent cultural values for his employees as (Can & Aktas, 2012) mentioned “In

individualism, where independency and autonomy gain prominence, the managers would

16
Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

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Case Study: “John Smith and Lillyvanian Systems”
want their subordinates to act more independently from themselves and to think

critically.”17

Also we could identify a strong social identity shared by the employees who from the

beginning of the company were proud of using LS as brand for their clothes spreading

globally the marketing of their company unconsciously because of their strong

commitment to the LS organization. The social identity was that strong that also

produced a big change to the company, a new division “the LS brand Division” was

created in effect for that social influence, making more revenue than any other division in

the company without marketing, following the concept “Social Identity” “…leadership

exists as a group-level process, that leaders are members of the groups they lead, and

thus, are also subject to the social dynamics that occur within group processes. We

propose that followers themselves can moderate the influence of leaders through unified

group-level emotions and collective action towards leaders.”18

c. Characteristic of the organizational structure of the outstanding:

1,Lillyvanian Cables (1948-1962); Lillyvanian Systems (1963-1977) had 6 divisions

:Lillyvanian Construction -Lillyvanian Cement & Concrete -Lillyvanian Construction

Equipment Rental -Lillyvanian Manufacturing-LS Payroll Services-LS Security Services.

17
Can, A. & Aktas, M. (2012). Cultural values and followership style preferences. Procedia-Social and Behavioral
Sciences, 41, 84-91.
18
Tee, E., Paulsen, N. & Ashkanasy, N. (2013). Revisiting followership through a social identity perspective: The
role of collective follower emotion and action. The Leadership Quarterly, 24(6), 902-918.

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Case Study: “John Smith and Lillyvanian Systems”
2,Lillyvanian Systems in (1977-2002) had 4 divisions: LS Construction Division-LS

Manufacturing Division-LS Consulting- Sales & Marketing- LS Service Industries and

16 subdivisions.

In 2001 the strategic separation of the organization in 6 divisions and 26 subdivisions

allowed the elimination of any redundancy to foster creativity and growth through

communication fluency.

3.Lillyvanian Systems in (2002-2014) had 6 divisions: LS Leadership & Planning- LS

Manufacturing- LS Service Industries- LS Financial Services- LS Lifestyle Brands- LS

Technologies and 29 subdivisions.

d. The planning and management of the internal process:

The “2000 and Beyond Committee” with John as the head of the team believed in

restructuring the company, and they changed the structure that had been in place since

1977 at LS and suggested the creation of six new formal divisions. He also proposed an

evaluation system where redundancy was limited to the minimum to promote creativity

and opportunity to grow, where every division, subdivision, and even role, in the

company was viewed at some point, by someone involved in the process. John valued the

diffusion of the responsibility and the close relationship with manager and employees;

here we could notice an “Enthusiastic Engagement” relationship between the leaders of

LS and the employees. As Malakyan (2014) notice like “Enthusiastic Engagement = High

competency, High willingness. When the leader or the follower is competent and willing

for a functional exchange, an empowering and delegating development style may be used

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Case Study: “John Smith and Lillyvanian Systems”
for the implementation of the LFT approach.”19 John was using an ambidextrous

leadership style, promoting transformational leadership, to motivate the employees to be

independent thinkers for innovation, where LFT approach was also used to facilitate the

exchange of information and communication between the leaders-employees throughout

the whole organization. “Thus, leaders and followers trade their functions from leader to

follower and from follower to leader in order to develop their intrapersonal perspectives,

foster interpersonal relationships, and maximize mutual effectiveness.” -Malakyan (2014)

e. The presence and interest with respect to share values and culture:

LS had from early on clear values and culture. LS was well known as an organization

where they always prioritize the employees, giving them first the opportunity to grow

into the company and also to get training and capacitation if needed to continue

development. The fourth dimensions of organizational culture, identified by O’Reilly, et

al. (1991) were present in LS organization classifying “groups of values specifically

related to internal organizational activities”20: .Innovation: where risk taking and

experimentation are valued, we can see this in LS as it was valued the “thinking out of

the box” and exploring new areas like “LS Lifestyle Brands”.

Respect for People: LS always supported internal promotions before anyone external, and

also during the times of change LS managers make sure to give anticipated information

about the changes, to help them with the transitions and provide training if needed to help

them feel confidents to move to the new divisions if needed.

19
Malakyan, P. (2014). Followership in leadership studies: A case of leader-follower trade approach. Journal of
Leadership Studies, 7(4), 6-22.
20
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.

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Case Study: “John Smith and Lillyvanian Systems”
Aggressiveness: “LS was hard but a good place to work” in LS competiveness was an

accepted value and managers were expecting the best from their employees.

Team Orientation: Before making any change the “2000 and Beyond Committee”

reviewed the entire proposals with one thing on mind, to don’t hurt the company and the

people who made the company. John was mindful of the importance of making the

employees happy and communicate them with prior notice any information about

changes for their smooth transition. LS was oriented on making their organization the

best place where to work.

Key issues:

1. Context-changing: LS was created in times of crisis after the II World War, at that time

there were huge needs of building reconstruction and electronic improvements. But now

"2000 Beyond Committee" understood that the context had changed and that the

organization needed to adapt to it. The needs of 20th-century society are different, a

society of globalization, multiculturalism, where technological innovation focuses on

improvement and efficiency, responding to a society in continuous movement of change

and adaptability. In the presence of these changes in society, LS is in the position to take

measures to suit to the new context, and find where to direct its concentration and

development. LS organization wanst to continue to grow organically, without losing its

identity, but it is aware that the new orientations of the company can be very different

from those of its precedents. The problem here is again how to guide the organization to

evolution without risking its identity, or its total existence.

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Case Study: “John Smith and Lillyvanian Systems”
2. Leadership Issues: One of the main concerns for John and his committee "2000 Beyond"

is not to harm the company; by this we mean, how they can go ahead with the changes

that the company needs to evolve to be at the level of market demands without changing

too much the identity of LS and without overloading or stressing its employees with the

changes. Another element that the leadership should take into account is the history and

number of changes that have been made in the last 10 years. The changes have been

many, and leaders must ensure that employees understand the need for changes and help

them with a sensitive transition of their thoughts and emotions, so they can continue to

trust LS. Here the problem is the strategies that are in place to help the relationship with

employees, the question would be to understand whether they are sufficient to move

forward or if more strategies are needed to implement. Another element that may be

problematic in the future is the ability to accommodate LS executives, as we have

previously observed there were questions imposed by Geroge Smith about the proposals

presented earlier for the implementation of the new division of "LS Brand". We are not

sure if the new proposals will be accepted positively or will be rejected by the executive

board, it would be good to consider these alternatives and prepare to respond with

sufficient supporting information to defer the new proposals if they are questioned.

3. Employee Problems: LS has always been well known for a great place to work, where its

employees have always been proud to be part of LS. Employees promoted LS clothing

brand unconsciously at a level of great success for the company due to its strong social

identity with the organization. But on the other hand, we could see that when changes in

the structure of the company were initiated and 26 subdivisions were created, some of the

employees were not satisfied with the changes, and as a result, outside unions were

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Case Study: “John Smith and Lillyvanian Systems”
created to advocate for LS employees. These unions were not very successful, because

the company was aware of the need to take care of their employees first than anything

else, and applied a strategic communication system in advance to inform their employees

during the period of change, providing them with all the possibilities to stay in the

company and obtain the necessary training to continue growing within the company. But

now with the new proposals for changes, we must consider that new conflicts with

disgruntled employees can arise. In the presence of this possibility the serious question

will be, LS has in place enough strategies to meet the needs of employees during periods

of change, and if not, what strategies would be necessary to continue to build emotions of

confidence, trust and motivation for the future to continue guiding its employees?

Recommendations

Based on a detailed assessment of revenue, revenue growth and business development

success over the past 50+years, we recommending that LS concentrate their attention in

the following principal focus areas:

1. Pursue innovation while remaining pragmatic to LS identity

• Be cautious about undermining the strength of the company’s reputation by

extending into business sectors where the company does not possess the expertise and

discipline, not considering and understanding the context and his interactional

psychology21.

21
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.

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Case Study: “John Smith and Lillyvanian Systems”
o Experimentation or failure in unfamiliar product or service areas could erode the

strong reputation that the company has established in building construction, building

supplies, power plant construction, etc. LS could lose the trust, social identity and share

identity with his followers and employees if end ups in a failure.

o Every success that they have experienced has been related to expanding their core

capability without depending on organizations external to the LS enterprise.

• Minimize financial risk by entering a business sector only after understanding the

market (Ex. the shoe sales sector was pursued by LS only after understanding the supply

and demand of shoes)

• Re-evaluate the LS Innovations (LSINNOV) and LS Future Space (LSFUTURE)

divisions approach for selecting new projects, ensuring that any new project proposals are

aligned with existing capabilities or experience possessed by LS.

(Ex. web consulting was developed organically within LS out of necessity to market

their brand, but pursued as a separate business division only after demonstrating their

ability to successfully promote their products)

2. Business-Leadership Strategy:

•Limit risk exposure by only extending into business sectors that are well understood

using the feedbacks from their own employees, using ambidextrous leadership22 to have

enough flexibility to use and altering exploration and exploitation behaviors throughout

22
Rosing, K., Frese, M. & Bausch, A. (2011). Explaining the heterogeneity of the leadership-innovation relationship:
Ambidextrous leadership. The Leadership Quarterly, 22(5), 956-974.


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Case Study: “John Smith and Lillyvanian Systems”
the whole innovation process. (Ex. affordably supplying clothing to construction workers

and entering the clothing sales sector after fully understanding the economies of scale in

the market)

•Pursue business sectors and markets that are aligned with the identity, core values, or

divisions that have contributed and matured to the success of the enterprise, respecting

the social identity23 and shared identity of the LS organization.

•Be selective about choosing only business lines aligned with the core competencies of

the company, particularly new areas related to business sectors that have exhibited high

growth (Ex. Fiber optics, web consulting).

•Continue to recognize and assess how new business opportunities are aligned with market

needs through the use of ambidextrous leadership (the use of explorative and exploitative

behaviors) promoting transformational leadership for innovations and using LFT to

facilitate the exchange of information between leaders-employees (Ex. Continue using

small groups of represents to hear the voice of each division, and continue using

questionnaires to receive feedbacks of everyone in the organization.)

3. Employees and Workforce Strategies

• Elicit feedback from employees on creative opportunities to expand into new

business sectors but also reassure team members that new business areas must rely on

23
Tee, E., Paulsen, N. & Ashkanasy, N. (2013). Revisiting followership through a social identity perspective: The
role of collective follower emotion and action. The Leadership Quarterly, 24(6), 902-918.

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Case Study: “John Smith and Lillyvanian Systems”
employee talents, already intrinsic to the LS enterprise, working on reinforcing the trust 24

on the relationship that “motivates followers to comply with and exhibit commitment to

their leaders”25 (Dirks & Ferrin, 2002)

• Create an environment where employees are encouraged to innovate. Empower

the values of innovation26and motivate the workforce to evolve the company’s business

lines based on emerging market demands, promoting the use of independent27 mentality

behaviors on their employees for increasing efficacy on the innovation process.

• Ensure that hiring managers promote diversity in the LS workforce, using

LFTrade approach as frame mentality “is more inclusive and humane because every

person, although not equal, has both leadership and followership traits and abilities.”28. It

was observed throughout the analysis of the case, that was not mentioned for presence of

females, Asians or African managers during the restructuration; as the LS becomes

globally international, it’s needed to employees to feel represented for continue

enhancing trust and social identity, and also the use of diversity at the leadership levels

will help to have new visions for new needs on the market globally.

• Promote a global perspective by ensuring diversity in the workforce and

encouraging leadership to inspire innovation, while embracing the fundamental corporate

values, commitment to excellence, and ideology that made LS successful.

24
Dansereau, F., Seitz, S., Chiu, C., Shaughnessy, B. & Yammarino, F. (2013). What makes leadership, leadership?
Using self-expansion theory to integrate traditional and contemporary approaches. The Leadership Quarterly, 24,
798-821.
25
Dirks, K.T. and Ferrin, D.L. (2002) Trust in Leadership: Meta-Analytic Findings and Implications for Research and
Practice. Journal of Applied Psychology, 87, 611-628.
26
Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership research. Human Relations,
62(11), 1587-1605.
27
Can, A. & Aktas, M. (2012). Cultural values and followership style preferences. Procedia-Social and Behavioral
Sciences, 41, 84-91.
28
Malakyan, P. (2014). Followership in leadership studies: A case of leader-follower trade approach. Journal of
Leadership Studies, 7(4), 6-22.

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Case Study: “John Smith and Lillyvanian Systems”
Conclusion

LS was born in response to the needs of its context. It develops through the ability of its

leaders to examine the demands of existing society and respond coherently with effective

services. LS was innovative from the beginning, providing stability and security to its

employees and clients, who for their strong bonds of trust and shared identity,

unknowingly promoted LS brand internationally. LS grew so much and so that they

expanded globally, to the point that with John Smith as leader, he undertook a new cycle

of evolution for the organization. According to John Smith, LS had obstacles to the

information flowing between the divisions, but John understood that the secret of LS

potential and their next orientation was in his employees inside the organization and

wanted to bring it to its maximum development. But like all companies, when they reach

a certain point of growth they need to make adjustments, in other words self-

actualization. The techniques and strategies applied in LS had been effective so far, but

with a new context including the new level of reaching and development of the company,

new strategies and visions were necessary, including a revision of its own identity.

We recommend 5 elements that should be a priority and transcendental to any changes in

LS:

1. A style of leadership that assesses and balances the needs and expectations of its

employees/clients-context”, a Strategic Leadership29 ("that perform a variety of tasks

including: "Making strategic decisions, creating and communicating a vision of the

future, etc.") that promotes transformational leadership orientation.

29
Boal, K. & Schultz, P. (2007). Storytelling, time, and evolution: The role of strategic leadership in complex
adaptive systems. The Leadership Quarterly, 18, 411-428.

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Case Study: “John Smith and Lillyvanian Systems”
2. Prioritizing healthy and proactive relationships with employees and clients," a

relationship based on LFT approach,

3. Maintain the reputation of the organization, promoting internal dynamics that inspire

trust and share identity,

4. A managerial entrepreneurship strategy that values innovation, using ambidextrous

leadership that consists of two complementary sets of leadership behaviors that

specifically match the requirements of exploration and exploitation.

5. Maintain the pre-existing values and culture.

If these five elements are kept constant, possibly any product or service offered by LS

would have a high level of success.

Regarding which direction LS should take, with what kind of projects to continue or not,

we recommend selecting new projects, ensuring that any new project proposals are

aligned with existing capabilities or experience possessed by LS.

Another key recommendation is the need of inclusion for more diversity on the whole

organization and specifically in leadership roles, as we have 3 generations of male leaders

from the same owners family, who have been producing great innovations for the

company but globally at this point remain static in the same orientation because of the

missing piece of the new element (of the diversity) that can bring a new horizons to the

whole organization.

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Case Study: “John Smith and Lillyvanian Systems”
Reference

Boal, K. & Schultz, P. (2007). Storytelling, time, and evolution: The role of strategic

leadership in complex adaptive systems. The Leadership Quarterly, 18, 411-428.

Burns, J.M. (1978). Leadership. New York, NY: HarperPerennial.

Can, A. & Aktas, M. (2012). Cultural values and followership style preferences.

Procedia-Social and Behavioral Sciences, 41, 84-91.

Dansereau, F., Seitz, S., Chiu, C., Shaughnessy, B. & Yammarino, F. (2013). What

makes leadership, leadership? Using self-expansion theory to integrate traditional and

contemporary approaches. The Leadership Quarterly, 24, 798-821.

Dirks, K.T. and Ferrin, D.L. (2002) Trust in Leadership: Meta-Analytic Findings and

Implications for Research and Practice. Journal of Applied Psychology, 87, 611-628.

Liden, R. & Antonakis, J. (2009). Considering context in psychological leadership

research. Human Relations, 62(11), 1587-1605.

Malakyan, P. (2014). Followership in leadership studies: A case of leader-follower trade

approach. Journal of Leadership Studies, 7(4), 6-22.

Tee, E., Paulsen, N. & Ashkanasy, N. (2013). Revisiting followership through a social

identity perspective: The role of collective follower emotion and action. The Leadership

Quarterly, 24(6), 902-918.

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Case Study: “John Smith and Lillyvanian Systems”
Rosing, K., Frese, M. & Bausch, A. (2011). Explaining the heterogeneity of the

leadership-innovation relationship: Ambidextrous leadership. The Leadership Quarterly,

22(5), 956-974.

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