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“How Barbie Lost her Groove” Case Study

The success of a business is determined by an interplay of factors. As a result, possessing the best technologies and business intelligence tools is not enough, but rather, it is important for the business to be proactive in understanding its internal and external environment. This statement applies to Mattel, which in spite of having the best systems and all the intelligence, was still trounced by an emerging brand known as MGA (Fugate et al, 2014). From the case study, it is notable that leadership, information technology systems, organizational structure and the general macro environment, including consumer behavior directly determines the performance of an organization. Seconded by this backdrop, this paper explains why Mattel’s managers were able to slowly change decision making over time and what kinds of cognitive errors contributed. It further explains and comments on factors related to organizational culture and innovation within Mattel’s setting that influenced the company’s move in a more positive direction.

Qn. 1: Why Mattel’s Managers were able to Slowly Change Decision Making over Time and the Kinds of Cognitive Errors that Contributed

                From the case study, it is notable that Mattel developed cognitive biases towards its Barbie brand. The firm cognitive error is the all or nothing thinking, also known as polarized thinking. The management failed to see the shades of gray presented by potential rivals such as MGA. It envisioned the barbie dolls to be the best and thus, made no efforts to alter it to suit changes in consumer demand among children. The second cognitive error is emotional reasoning. The management at Mattel was emotional towards barbie doll. In spite of all the red flags, the management believed that its three decades of reputation made it too big to fail.

                To address these cognitive biases, the management had to introduce situational leadership theory. According to Blanchard (2008) situational leadership requires leaders to select the right styles of leadership and apply it to the right people. This approach to leadership encases four activities which are delegating, telling, selling, and participating. The change in leadership reduced reliance on the intelligence gathering programs and instead, focused on internal ideas and solutions to challenges facing the company. Secondly, Mattel’s management slowly changed decision making by fostering the emotional intelligence of their employees and leaders. Whereas emotional reasoning led to the fall of barbie, the management had to create a culture that optimized the emotional intelligence of its teams. In particular, the culture sought to foster self-awareness, social awareness, relationship management and self-management (Goleman, Boyatzis & McKee, 2002). As a result, it created effective teams that aligned the organizations goals to the changing needs of the customers.

Qn. 2: Factors Related to Corporate Culture and Innovation within Mattel

                It is observed that Mattel’s CEO and Chairman, Robert Eckert was a strong and dependable leader. Having worked at Kraft Foods for 23 years, he was experienced and capable of leading a turnaround. Through his leadership, he had revised and maintained top leadership principles, and also improved the company’s values and policies to encourage productivity among employees. These sentiments are shared by Andrews (2004); Bowers, Hall and Srinivasan (2017) who notes that managers who review and set challenging yet achievable goals, and create a working environment that is conducive have a higher chance of steering the organization in a positive direction. Secondly, Mattel had a wide range of business intelligence services and tools that helped collect real time data and information on the market, customers, rivals and current trends. The information contributed towards knowledge management which fostered innovation. Using the system, the management managed to identify current trends and respond accordingly by innovating new products such as Fashion Fever Barbie dolls, My Scene, and Herbie to counter MGA’s Bratz and My Bratz dolls.