Eric Smithson is the CEO of the Smithson Company, a privately owned, medium-size manufacturing company. The company is 20 years old and, until recently, had experienced rapid growth. Mr. Smithson believes that the company's recent problems are closely related to the depressed U.S. economy.
Brianna Smatters was hired as the director of corporate planning at Smithson six months ago. After reviewing the performance and financial statements of Smithson for the last few years, Ms. Smatters has come to the conclusion that the economic conditions are not the real problem, but rather exacerbate the real problems. She believes that Smithson Company products are becoming obsolete and that the company has done a bad job of reacting to market threats and opportunities. She also believes that the strong functional organization impedes the kinds of action required to remedy the situation. Accordingly, she has recommended that Mr. Smithson create a new position, manager of special operations, to promote and use project management techniques. The new manager would handle several critical projects in the role of project manager.
Mr. Smithson is cool to the idea. He believes that his functional departments are managed by capable professional people. Why can't these high-level managers work together more efficiently? Perhaps a good approach would be for him (Smithson) to give the group some direction (what to do, when to do it, who should do it) and then put the functional manager most closely related to the problems in charge of the group. He assumes that the little push from him (Smithson) as just described would be enough to "get the project rolling."

Questions: After this explanation Ms. Smatters is more convinced than ever that a separate, nonfunctional project manager is required. Is she right? If you were Smatters, how would you sell Mr. Smithson on the idea? If a new position is created, what other changes should be made?