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The Malden Mills

The Malden Mills Case Study

As a private strategic consultant, the scheduled strategic plan for the company will
have to be reviewed as a result of the dramatic misfortune that has befallen it. Owing to this
situation, decisions will have to be made on both the strategic and operational fronts and
viable plans for the future of the company formulated. In this study, knowledge regarding the
strategic planning models, decision processes, and an SWOT analysis of the business and its
environment will be applied.

Development of an effective strategic plan for the current unfortunate situation,
understanding of strategic thinking processes, and tools such as issue based planning will be
used. In the issue-based strategic planning, external and internal assessment to identify the
strengths, weaknesses, opportunities, and threats in the current business circumstances need
to be determined. The criteria for planning will also involve strategic analysis to identify and
prioritize the major issues that arise from this situation and the short and long term goals that
need to be made. This criteria will also include the establishment of action plans that will be
used to implement these strategies. The areas that will be covered by the action plan will
include the needed resources, objectives of the implementation, and the roles of individual
stakeholders in the process of implementation. Organic planning can also be used in this case
to clarify the organisational cultural values in relation to various stakeholders within the
Malden Mills environment (Thompson & Strickland, 2011).
Key stakeholder analysis will also be necessary in the implementation and design of
the strategic and operational plan to help move the organisation from the current situation to
an ideal one. The stakeholders are people or organisations that are negatively or positively
impacted by the operations of the company. Key stakeholders are those with significant
amount of influence within the organisation and include the employees who would soon lose
their job positions. As a result of the burning of the textile mills, several parties will be
affected including the management of the company that includes Mr. Farnsworth, who have
to deal with the rebuilding of the company and shareholders who belong to the Farnsworth
family. Others include the insurance company that will handle the insurance claim of the fire
on the assets of family fabric, and the entire council and community of the town especially
the individuals who might have been displaced as a result of the fire. The harmonious
relationships among stakeholders will greatly affect the post-crisis responses of this incident
in the organisation (Weiss, 1994).

A recommendation for direct action will involve short-term crisis management
strategies such as ensuring those injured in the inferno have the most effective health care to
avoid any lawsuits that may arise due to negligence. Sending corporate gifts and get-well
messages as a simple act of compassion can save the company millions of dollars in legal and
compensation fees. The next most immediate action would be to salvage any assets left after
the inferno. These would include raw materials, finished goods, and some plant and
machinery that might have survived the inferno. The cost of reusing these materials or
refurbishing these assets would be far much less than procuring and buying new items. The
employees of the company will then be asked politely through direct email to not resume
work until investigations about the cause of the fire are finished, and cumulative damage
done to the factory accounted for. This notice will provide the management of the company
with ample time to set up back-to-work strategy for the employees since the company is
deemed as an economic cornerstone for the community. This communication will minimize
the expected worry and uncertainty of workers, the community, and other stakeholders in
general and give at a minimum some hope and reassurance (Wells, 1997).
The long-term strategy for the future of family fabrics will depend on its long-term
considerations. These considerations include the rise of competition in the textile market
since the outdoor clothing manufacturers and design houses have expressed an interest in the
product and the demand for it is high. The second consideration for the future would be
providing a plan to ensure that the universal decline of the textile industry due to
technological advances, foreign competition because of the availability of cheap labour, and
other hosts of economic factors such as the decline of disposable income from traditional
customers of the company, does not affect the company. The third factor to consider for the
future of the company would be securing the necessary funds from other financial bodies
such as banks and other outside investors for the restoration of the century-old building and

all its contents including other machinery and technology. Closure of the company is not an
option since its death will result to the death of all the economic activities in the town due to
the loss of jobs for the employees who are inhabitants of the town. Increased financing from
either debt or equity might make the Farnsworth family lose a significant share of their stake
in the company unless they find a way of getting all the finances necessary to rebuild Family
Fabrics by themselves (Hill & Jones, 2010).
A plan for viable business options for family fabrics would include painful decisions
such as reducing the overall employee numbers working in a factory until all operations
resume as usual. Other business options would be to expand the market base for the “Arctic
Cloth” into other international markets. This can be done cheaply by considering building a
branch of the company in an area with cheaper labour and freer labour loss. The profit margin
of the company as a result might increase if the management of the company decides to
reduce the retail price of the commodity thus maximizing in the economies of scope and
scale. The company also needs to invest in more technologically advanced processes of
production and utilize the produced by order basis (Drucker & Maciariello, 2008).
The efforts above will guide the management in the development and growth of the
operational plans necessary to achieve a “big picture” as prescribed by the longer-term
considerations of the management team of family fabrics if the organisation’s core
competencies are used to bring about some competitive advantage and critical goal



Drucker, P. F., & Maciariello, J. A. (2008) Management (Rev. Ed) New York, NY: Collins.
Hill, C. W., & Jones, G. R. (2010) Strategic management cases: an integrated approach (9th
Ed.). Mason, OH: South-Western/Cengage Learning.
Thompson, J., & Strickland, I. A. (2011) Crafting and executing strategy: concepts and
readings global edition concepts and readings (18th-rev. ed., global Ed.). London:


McGraw-Hill Higher Education.
Weiss, J. W. (1994). Business ethics: a managerial, stakeholder approach. Belmont, Calif.:
Wadsworth Pub. Co
Wells, S. J. (1997). Choosing the Future the Power of Strategic Thinking Burlington:

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