OS608
11/02/05
Leadership Essay
From the Harvard Business School case revised May 25, 1993, Rohm and Haas was a
leader in chemical technology. One of its four main business segments was Industrial
Chemicals, where its strongest product is Kathon 886 MWX capturing 30% of the maintenance
biocide market for large systems. Customers who were satisfied with the performance of this
product asked for a “convenient, safe-to-use version for their smaller reservoirs” (p4). In
December of 1983, Rohm and Haas launched a brand extension called Kathon MWX, designed
to kill microorganisms in metalworking fluids for customers with small-capacity tanks. The new
product was distributed by large industrial formulators along with the existing Kathon 886
MWX, but sales volume for the product was only 6% of what was expected.
Joan Macey, the marketing manager for Rohm and Haas explained the poor sales as low
awareness of the brand and its usefulness along with the lack of competition to build demand.
The real problem however, was that Kathon MWX was not positioned correctly. Rohm and
Haas was an industrial supplier that was trying to sell a consumer product. Because of the pricing
scheme, the customer had a very low perception of its value. Furthermore the distribution
channel was not appropriate for this type of product. Just because Kathon MWX may have
looked good on paper, it didn’t mean the company should have hastily launched the brand.
In this situation, more effective leadership would have helped Rohm and Haas avoid such
a negative outcome when implementing its new product marketing strategy. Branding of a new
product is not easy, it must be thought through in great detail since there are many different
strategies that can be adopted. Therefore, a leader had taken on a more analytical mind-set, it
2
would have been able to position Kathon MWX more appropriately. The company saw a market
demand, but did a shallow analysis and used easy techniques such as running the numbers. As
Gosling and Mintzberg put it in The Five Minds of a Manager, they did nothing “beyond the
superficialities of obvious analysis” (p. 4). Joan Macey needed to go deeper in to the analysis
looking at data, assumption and limitations while inquiring into how others drew conclusions.
This analysis could have helped her to realize that making Kathon MWX a brand
extension of Kathon 886 MWX added no value to the product because no brand awareness
existed. This was mainly due to the fact that Kathon 886 MWX it was distributed through
formulators, so the end user never saw the label containing the name. Consequently, since the
new product was designed for consumers, it would have been much smarter for Rohm and Haas
to market it with a name that would suggest something about the product’s benefits and quality
as well as be easy for customers to pronounce recognize and remember. Another way an
analytical mindset would have benefited the new product’s launch was in choosing its
distribution channels. According to a survey in the case, while customers do purchase
metalworking fluids from large national formulators, the majority shop at small, local tool or
supply shops. Since this product was seen as a consumer packaged good and was not only
competing with metalworking fluid biocides, but also household cleaners, Rohm and Haas
should have positioned it that way by making it available in these local stores.
Aside from the lack of analysis from leaders in the organization, another cause of these
mistakes was the lack of fit between product and company’s culture. Rohm and Haas had
traditionally been an industrial supplier, distributing products in large quantities. As a result, the
culture was not consumer product oriented and employees were not accustomed to designing and
marketing a product for consumer use. Joan Macey’s failure to recognize and understand the
3
company’s culture and its affects on the success of Kathon MWX were a big factor in the
product’s failure. For that reason, if she had adopted a more worldly mind-set, the results could
have been different. Like Gosling and Mintzberg said “should we not be getting into worlds
beyond our own - into other people’s circumstances, habit, cultures - so that we can better
understand our own world”(p. 5). If Macey had understood that other employees in the
organization were not in the habit of marketing a consumer product or part of a culture that
fostered the necessary tools to do so, she could have taken a different approach to launching
Kathon MWX.
This new product needed more of a leader and less of a manager. As Kotter said in the
1990 article What Leaders Really Do, “Management is about coping with complexity.
Leadership, by contrast is about coping with change” (p. 4). When launching its new product,
Rohm and Haas didn’t just need someone to maintain order and do the administrative work in
this situation, it needed someone to foster change in the organization and prepare people to think
in terms of consumer packaged goods instead of strictly industrial needs. By setting a direction,
aligning people, motivating and inspiring them, a leader could have had a positive impact on the
capabilities and success of an organization when launching Kathon MWX.
One of the best ways that Macey could have accomplished this was to adopt a coaching
style of leadership. By teaching and advising those involved, the task of marketing a product in
a foreign segment would not be as shocking or difficult. She should therefore have helped them
to determine their role and responsibilities in developing this new product while giving them the
necessary instruction and feedback. Making expectations clear and maintaining constant
dialogue is also critical in the success of the project. Although this would have been time
4
consuming for Macey, she must realize that fostering this type of change in an organization is
not easy.
Hopefully Macey will learn form the mistakes that were made in launching Kathon
MWX. In order to become a better manager she should “step back and reflect thoughtfully on
[her] experiences” (Gosling p. 4). It is important to digest experiences and learn from them.
This will help her in the future to adopt a more analytical mindset, gain a better understanding of
the company’s culture, act more as a leader, establish a vision and foster change.
5
Works Cited
Goleman, D. (2000). Leadership that gets results. Harvard Business Review, 78(2), 78-90.
Gosling, J. & Mintzberg, H. (2003). The Five Minds of a Manager, Harvard Business Review,
81(11), 54-63.
Kotter (1990). What leaders really do. Harvard Business Review, 68(3), 103-111.