Abelli and Saviotti at Banca Commerciale Italiana A Case Solution

2. Problem Identification

The major issue highlighted in this case is that there was a greater power to Mediobanca, and it played a highly influential role in this merger. This resulted in Mediobanca playing an influence in the decision making by making use of its extensive and formal network. Also, Mediobanca was associated with networking relations with other organizations that were directly and indirectly linked to the governance of the BCI. This case is a classic example of power being exercised through intermediaries in an indirect way. This also shows that the power in the organization is based on the exercising of power.

Abelli and Saviotti, on the other hand, we're unable to develop relationships with their stakeholders. The networking of Mediobanca was a source of power for the company that BCI did not possess. However, the main problem found was that Cuccia, the manager, and the company, Mediobanca was threatened by the merger and the resultant of the same on them. This was because their autonomy could be challenged as a result of the merger. As a result, they opted to mobilize their strong networks to influence the board members indirectly. This is because after the merger Eurobanca would become the greatest shareholder in Mediobanca with a 17.5% share in the company.

3. Analysis

With the main problem being a threat to Mediobanca’s autonomy, Bazoli, an operator in the company acts as Cuccia’s savior and reducing the threat to his autonomy. Bazile proposes a solution that is inferior to the deal that was to be made with Unicredito. Furthermore, he uses tactics like refusing to give details that resulted in the BCI board members rejecting the deal with Unicredito. However, one analysis is that the Cuccia fails to assess the Bazoli would be unable to control the situation later as the steps are done resulted in short-term goal achievement. Mediobanca is the most influential party in this case. This is because Cuccia was nearing retirement which meant that he held the power for a little longer.

Generali is also a key player in the case who assumes a brokerage role. The board of the company is not indecisive on this issue. Mediobanca was also in control of Generali that was because of a joint pact with Lazard. This intermediary company was in favor of the deal with Unicredito. This case shows that dense networks restrict the company to bring about a change. This culture based on extensive networking is effective for the maintenance of norms in the company and controlling behaviors and inducing control in the organization.

Cuccia’s role, in this case, can be analyzed as a person exerting power and influence in the case. He wanted followers that would accept his power and accept it. Abelli and Saviotti were new managers with fresh ideas. They were in favor of the Unicredito deal because of the merits it offered the company. Furthermore, the problem was that the decision making was highly complex because the decision-making parties were highly dependent on other members that were also influencers in the decision.

Another concept of conflict can be applied to this situation. There were two major conflicts that further made complex the case. These were intergroup conflicts between the BCI and Unicredito. This was a major overview of the conflicts in this case because they were macro in nature. Furthermore, there were personal conflicts between Cuccia, and the co-CEOs, Abelli, and Saviotti. These companies were not able to resolve this conflict because there were powerful influences in the organization. Also, coalition tactics were used to influence people. This meant gathering other parties to support their cause to make it happen. In this case, Cuccia and Mediobanca exercised the same power to prevent the merger. Using Bazoli as a tool to influence the decision is an example of coalition tactics.

Cuccia’s personality can be assessed according to the big five personality traits as being very determined and having an internal locus of control. Abelli and Saviotti, on the other hand, had proactive personalities and high skills. Furthermore, Cuccia had a need of power according to the McClelland theory of needs. Furthermore, according to the levels of political actions in organizations, this case is based on network-level politics. Also, in the case of Cuccia, the individual level of politics can also be applied because Cuccia was exerting influence to sustain his need for power in the organization. Furthermore, the problem stemmed from the lack of trust between the two parties. Also, Cuccia and Mediobanca were found to be uncertain of the change.