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Rudi Gassner And The Executive Committee Of Bmg International (A)

This case explores the roles of CEO Rudi Gassner and the 9-person executive committee in leading BMG International. BMG International is the international music subsidiary of Bertelsmann, a German company that is the second-largest media conglomerate in the world. In particular, the case describes a 1993 decision that Gassner and the executive committee must make about whether or not to change managers' business plans and bonus targets as a result of a newly negotiate reduced manufacturing cost. Some of the major and important issues discussed include: the complexities of managing and growing a large global business; the tensions between centralized corporate control and decentralized local management in a global organization; the impact of leadership style on corporate culture and performance; the challenges of leading a senior management team; and the final proposed decision by CEO Rudi Gassner about the business plan and the reactions of the Executive Committee members.
I will try to analyze the case by classifying it in to four parts:
1) Rudi Gassner’s Leadership Style
2) Power and influence Tactics
3) Evaluation of the Executive Committee Meetings
4) Recommendations

1) Evaluation of Rudi Gassner as a Leader
Rudi Gassner is a very effective leader. His leadership style can best be described as a transactional one although he also displays some qualities of transformational leadership. His transactional leadership characteristics are displayed decision to prepare a yearly business plan for each Managing and Regional Director. His focus on clarifying goals and providing rewards and bonuses contingent on performance is a typical behavior associated with transactional leaders.
He also had displayed the four key sets of leader behaviors associated with transformational leadership, namely: inspirational motivation, idealized influence, individualized consideration and intellectual stimulation. His great vision for the future of the company; his ability...