Big Spaceship: Ready to Go Big Case Solution

2. Introduction and problem Identification

Big Spaceship was founded in 2000 by Lebowitz and his colleague. Initially the company produced email newsletter for consulting firms. Collaboration with Miramax films turned out to be key project for the company, and as a result, by 2004, the company started receiving inquires from Paramount Pictures and Sony Picture. By 2005, the company had started working for Nike’s ‘Air Max shoe’ digital marketing campaign. This campaign turned out to be a major success not only for the company but also for Big Spaceship. The firm has succeeded so far by focusing on innovation and by following a unique model of client selection and engagement. Lebowitz, CEO of the company, always saw scale and quality as mutual opposites of each other. But since the business is growing now, it is essential for Big Spaceship to expand. Therefore, the management’s central challenge now is to figure out how to expand while maintain its innovation driven culture of the company.

3. Strategic Alternative I

At Big Spaceship, CEO Lebowitz places a strong emphasis on innovation. To him, his company is not a simply a producer of websites but an effective way of reaching consumers through digital media. Therefore, innovation is the heart of his company. Lebowitz always believed that companies cannot achieve quality innovation if they are functioning at a big scale i.e. quality and scale is opposite. But since the business is growing, the company must grow. One strategy that the company could pursue is hiring a new layer of middle management. This middle management can work as managers in the company. This will reduce the burden of work on the top tier management too. These managers can effectively manage teams and company will then be able to take more clients. Adding an additional layer will also more ideas.

However, this management will also come with many disadvantages. As CEO had always predicted, this will lower the quality of work. The more people there are in business, the more delegation of responsibility and hence, more difficult it is to trace the relevant person. Furthermore, if business fluctuates, the company will become overstaffed with too many employees and little business to do.

4. Strategic Alternative II

The second strategy that the company could pursue is to hire new people in the departments and go back to the function based organizational structure. The business is expanding; therefore, they have to grow. New people not only mean more hands to work, but also fresh and innovative ideas to work with. Switching back to function based organizational structure will also be helpful. The company places innovation at its heart. If people of the same department sit together, interaction and information sharing would increase. New employees would get to learn about the department, work and values of the company more quickly. This would help in employee development, which would ultimately add to the company.

One major disadvantage of hiring new people is reduced quality of work. The top tier management would have more work to review. Adding too much of the team would cause dilution and hence long term problems. Furthermore, switching back to functional strategy would once again create the problem of communication among the project team which will hence reduce the efficiency. Each department would be focus solely on their work, and hence each production phase will be totally separated from the other. Problems that arise in a particular project would also take more time to be solved.

5. Strategic Alternative III

The third strategy that the company can pursue is to open another branch of their agency in some other city. Big Spaceship already has the experience of working with satellite system; therefore, they can pursue this strategy very easily. The CEO had one of his branch failed in Los Angeles, but as pointed out in case, the reason of this failure was the different culture of LA. LA is an industry town; therefore, lacks the proper talent pool. Now, the company should open its office in a business hub where talented people are available who can understand the needs of business and its clients. Through this, company would be able to take more business.

This strategy is good for the company but if not pursued properly it will have more disadvantages than advantages. Even if the company starts operating in business hubs, the probability of attracting talented and innovative people is not high. Big companies usually pay more than Big Spaceship and hence it’s easy for them to attract talented people. Opening an office in prime business city means increased competition with many traditional marketing companies. Increased staff might not provide quality work as CEO feared. Opening a new office would also increase costs drastically. Other than salaries, it would add to the operating cost. This might result in low profits for the company and shareholders. Lastly, a new city and new people might require compromise on core principles of Big Spaceship as each city has its own culture which might not fit best with the culture and value of the company.