Discuss what diagnosis is and diagnose the situation at Pegasus.

You are an internal consultant directed to plan the reorganization for Pegasus Company, a large aerospace research and development company. You work in the Human Resource Development (HRD) Department and have three direct reports. Your team has never experienced reorganization, and you will be responsible for coaching them as well as facilitating the reorganization itself. The goal for you and the HRD team is to help Pegasus remain effective and efficient in today's competitive marketplace.

Pegasus is widely known for its wind tunnel research technology. Scale models of new products (plane, helicopter, jet, space shuttle, outer space voyagers of various sorts, etc.) are tested for imperfections, safety, and practicality. Pegasus is comprised of engineers, computer aided design (CAD) designers, scientists, model makers, and administrative staff. The company started out small and has grown rapidly over the past few years. With that group came organization into departments, by skill group (e.g., engineering, design, R&D). By now, people in different skill groups do not communicate to each other except to pass along designs, projects, and other pertinent ideas to complete project goals. This has caused many problems in the past because each type of worker has his/her own language for his/her subculture of the organization.

Therefore, projects take a long time to complete due to mistakes in the plans, redoing the mistakes, and failing to take into account the specifications of the scientists and engineers by the CAD designers because they have not been clearly communicated. The administration and leadership of the organization lack good skills in interpersonal communications due to their heavy science background, and they also need leadership training in the form of management and executive development.

The culture of the organization has been what has kept most people there, not the compensation. In the past, the organization was open, non-hierarchical, and it enabled employees to pursue their professional passions. The main piece of the culture of Pegasus that has always led to retention of employees is that the employees feel as though their jobs are their life and that they have accountability for their part to the greater whole of whatever project on which they are working.

Many employees feel like the company is disintegrating due to the difficulties in communication which, in turn, makes it more difficult to get the projects completed in a timely manner. This is leading to rumblings among the staff about leaving Pegasus. Since Pegasus is located in a highly concentrated technical area of the country, there are other companies that pay better and seem to be more competitive for contracts. The leaders of Pegasus are afraid of losing their best and brightest employees and feel the pressing need to streamline their organization to remain effective, efficient, and competitive.

You, as the lead internal consultant, are first tasked to restructure the organization. This may mean a reduction in force (RIF). You hope you can restructure without a RIF. You will also need to bring the various teams of employees together and teach them communication skills, process skills, and leadership skills that can hold the company together. You have your work cut out for you.