Ferox Manufactured Products Case Study - Change Management

Essay by alxx00University, Master'sA, July 2006

download word file, 13 pages 3.4

Downloaded 179 times


This paper aims to analyze the current situation of Ferox and make recommendations regarding the strategy and the action plan to be followed in order to cope with change.


In October 1991, a public announcement was made, regarding the privatization plan of Ferox, a Czechoslovak gas and chemical company located in a northeastern industrial city near the German border.

The privatization proposed project was stipulating the following:

- 3 % of shares - set aside as a reserve fund for restitution to the original owners;

- 3 % of shares - for employees purchase;

- 52 % of shares - for purchase by the international gas products corporation, Air Products and Chemicals Inc. (APCI), headquartered in US;

- 42 % of shares - for purchase by Czech citizens, through the government voucher program.

Ferox has 1,350 employees organized into six functional departments: production services, production, commercial, economics, personnel, engineering.

APCI recognized that even if in this country the industry is old, there is a lot of production capacity. Therefore, APCI decided to purchase Ferox, and was planning to transform it in its biggest manufacturing facility.

APCI will have a major role in Ferox privatization, due to the fact that it will bring important contributions like: specific know-how about the gas business, management skills; financial and accounting skills; technological skills and marketing skills.

Business Context

The period immediately after the velvet revolution in 1989 meant difficulties for the majority of companies in Czechoslovakia, including Ferox: an instable political situation, the tendency of replacing people rather than changing their behaviour, a new management that does not know how to run their company, the belief that old contacts are not useful anymore.

A critical factor that influences the change both at the national and corporate level is the lack...