Question: Ms Zee, MBA graduate from OUM, came home to manage her family business upon the death of her father. She found the morale and productivity of the employees low due much to the autocratic leadership of her father, who built the company from scratch, and his long illness. Discuss how she could motivate the staff and get the company going again. (Identify the type of business of the company, and cite theories).
According to Certo & Certo (2006, pp. 382), Motivation is the inner state that causes an individual to perform and ensure the accomplishment of some objectives. Motivation cannot be seen but it is inside everybody and it triggers the level of performance / work output in achieving their objectives. The higher the motivation levels the higher the result of the employee’s work output. Because the result of the employee that counts, Motivating employees is of the number one priorities to achieving organisation’s objectives. Plainly put, understanding an employee’s need is a key in order to nurture an individual’s motivation level and a good manager needs to focus on this. Being able to understand one’s need and know how to satisfy the need proves essential for a manager to motivate its employees.
Ms Zee’s family business is involved in the furniture business, manufacturing and distributing to furniture companies around Johor and Selangor. The base of her business is in Teluk Ramunia, Johor which is located approximately 130km from Johor Bahru and 60km from Kota Tinggi the nearest town. Her father named the business Lenthall. Lenthall has developed from a small two storey building company to a big organisation with a factory spanning 2 acres of land and employing more than 70 workers.
Ms Zee’s father has no qualification and has risen from ground to become one of the leading entrepreneurs in the furniture business in Johor. Her father’s autocratic leadership which depends on his authority and power as business owner limits his effectiveness as a leader. Lenthall has stop flourishing for the past 5 years of its life where the customer based is shrinking and the furniture design has not changed.
Ms Zee is convinced that with her MBA degree that she have, she can turn around the company to embrace the new millennium with innovative and creative design. She will combine both autocratic and democratic leadership as she does not want to limit her effectiveness as a leader and a motivator using the Tannenbaum & Schmidt continuum. She is also confident that the employees that she has are capable to help her achieve this by practicing the motivational and Influential skills she learnt during her study.
The only stumbling block would be her father’s previous autocratic leadership which has nullifies and blocked the innovative and self development of its employees. Autocratic leadership is least desirable when building human relationship as one person has control over all of the workers and no one is permitted to make any suggestions or offer any opinion despite the fact that it may benefit the group. The communication line is also one way where the leader tells you what to do and only highlights the employee’s mistake.
Graham (1995) suggested that specific leadership styles motivate employees differently and encourage specific sets of responses. Time is changing and she needs to embrace and catch up with the new market demands for new furniture design and concepts. Her father tends to ignore his employee’s input and ideas and assume all his employees as mere followers and is unable to contribute ideas and believe in Douglas McGregor’s Theory X where all assumptions are “bad”.
Ms Zee furniture business is divided into 5 divisions which is Administrative (Human Resource & Finance), Procurement, Logistic & Distribution, Warehouse & Production and Design & Engineering. Under her are 5 managers reporting directly to her and is in charge of their own division.
Needs-Goal theory explains that motivation begins with an individual feeling a need. This need will be the motivator in achieving the goal. This will continue until the need is significantly reduced. (Certo & Certo, 2006)
Layman Porter and Edward Lawler developed a complex model called The Porter-Lawler Theory of motivation which an extension from Equity and Expectancy theory. The model suggested that there are five components that affect motivation: efforts, perception, performance, reward and satisfaction. The employee will have an expected value of a reward, and this will be followed by performance which will be admitted by rewards, both intrinsic and extrinsic. Intrinsic is rewards that is directly from doing the task while extrinsic is reward which are extraneous to the task.
The need in Lenthall varies from different department and different layer of working levels. Understanding of the Needs-Goal and Porter-Lawler thoery is vital for Ms Zee in crafting the motivational requirement for each of her department.
She started with her Admin division as this department is in charge of providing salary and basic needs to all her employees. She discussed with her admin managerial team and using the Maslow theory she is trying to improve what Lenthall can offer to its employees. Maslow explains that by satisfying the human physiological needs, security and social needs in order of hierarchy will motivate an employee.
The higher the needs are satisfied the more motivated the employee would be. The current benefit package seems to concentrate on extra monies if an employee performs an overtime work. Ms Zee quickly realizes that this is only beneficial to the direct labour which works in the warehouse. Her father satisfy himself by seeing all his workers work until late of the night. Ms Zee disagree, she prefers productivity over quantity of worked hours. Thus, the overtime pay rate is reduced significantly while the basic rate is increased significantly for the direct labours. Her finance presented her with the calculation and it is only 2% increase of the total expenditure and Ms Zee quickly agrees.
She is confident that this will prove motivating and will provide her with a good result. The workers will inherently be happy as they will be able to work less hours but will be receiving better pay. Ms Zee also proposed for reward scheme to increase the productivity level of her workers.
Ms Zee then discussed on relieving some of her authorities to her direct managers in charge of the divisional department in order to provide self esteem and self-actualization to its employees. Prior to this, all decisions are solely by her father. This will provoke a long term motivator in her direct managers as suggested by Maslow. The managers, having more authority at hand will definitely be getting the job satisfaction and the feeling of appreciated and belonging to the company. The managers need for power will definitely be satisfied as suggested by McClelland Acquired Needs Theory.
She also introduces flextime for her employees where an outgoing permit concept is implemented. All employees that have to go out during working hours will get an outgoing permit and signature from their direct supervisor will be allowed a release of 2 hours.
This will definitely be a bonus to the employees as they normally have to take leave of one day to do some chores which only takes less than an hour to do but have to be done on weekdays. The direct supervisor however will be responsible to ensure that this is not abused. Douglas Fleuter concluded that flextime will contribute to greater job satisfaction and productivity. Other research also concluded that this will increase productivity.
Ms Zee then visited her procurement department. Previously all Lenthall sourcing is done by direct negotiation with a supplier from Sarawak. She realizes that this is financially a constraint and the prices are usually higher from the market value. Furthermore, her design & engineering department usually have to compromise on their requirement to accept whatever the sole supplier have to offer. This happened as her father’s previous tie with the supplier is close bonding.
Ms Zee decided to put an end to this and introduce a competitive bidding strategy. She relieves her authority and encourages her employees to be proactive in sourcing for suppliers which could provide technically sound requirements as per design & engineering request. By having this, Job enrichment is given to her Procurement department. Besides doing the same thing over and over again their new Job Design will give Lenthall’s procurement department more interesting work with options to visit Lenthall’s future supplier.
Job Enrichment as suggested by Herzberg is a process of incorporating motivators into a job situation. Texas Instruments, Volvo, IBM, MMTC and many others reported success in motivating organisation members through job enrichment program. Ms Zee also allows for job rotation for young executives looking for promotion in her organisation by completing rotation.
Ms Zee found out that Lenthall’s logistic & distribution division constitute mostly workers with the age of 35 and above and are mostly with a family to support. Lenthall have 8 lorry drivers and are working long hours every day. She decided to employ an additional 3 employees to assist the existing task force. Despite the fact that Lenthall is only supplying to Selangor and Johor will change as Ms Zee is planning to expand Lenthall’s business cover the whole of Peninsular. She also decided to increases the incentive if a destination requires more than 6 hours of driving.
This reward will surely have a positive reinforcement on her workers as their need for cash and incentive is higher in order to provide for their family.
Ms Zee also decided to revamp her warehouse and production line. Previously one worker will do the entire cycle of chain from cutting, fitting, assembling, polishing and fittings the furniture. She decided to makes jobs simpler and specialized to increase the productivity and turns the existing setup into a furniture assembly line.
However, a worker after a timeframe could be rotated to another position to evade job boredom. Ms Zee understands wells that Job Design is one of the strategies that a manager can use to motivate organisation members.
One of the most important changes required in Lenthall is at Ms Zee’s design & engineering department. Ms Zee introduced a new setup where custom made furniture’s is constructed upon request from customers. She also encourages her employees to be more creative by providing monetary incentives. If a design sells well, the employee would be given incentive of one ringgit for furniture sold (monetary incentives).
Her father use to control all the design and this decreases the creativity level of her employees and she decided to go away with it. All new design will be with limited production and if proven to be a success she will increase the production line. With this, new designs can be tested on the market and open the room for her employees to be more creative.
Ms Zee knows that to motivate her employees, she will keep five specific principles of human motivation:
1. Felt needs motivates the behavior in satisfying the needs
2. Degree of motivation is determined by individual perceived value and probability of the result of the behavior
3. Perceived value of a reward is determined by both intrinsic and extrinsic rewards that result in need satisfied and is a motivational factor
4. Individuals can only accomplish a task if they understand what the task requires and have the ability to perform the task and will feel motivated
5. The perceived fairness of a reward influences the degree of satisfaction generated when the reward is received (Certo & Certo, 2006)
On an overall basis, Ms Zee has given a new breath of air for Lenthall. Her employees are all capable and have been working in Teluk Ramunia for years. Citing Argyri’s maturity-immaturity continuum Ms Zee need to utilize the fact that her subordinate is well ready and is aspired to occupy better position with more room for power and self decision. Argyri’s maturity-immaturity concluded that as individual mature they will have increasing needs, behave in different ways, have deeper and lasting interest and is more willing to take control over their own destiny like from an infant growing to be a full adult.
In her inauguration speech, she made it clear to all the employees that she is dedicated and committed to bring change to the company and to embrace the future. She proclaims that the time has come for a change and will need the full commitment from each employee.
Quoting Victor Hugo dictum that “Greater than the tread of mighty armies is an idea whose time has come”, Ms Zee is set to transform her company and motivate its employees. Within a year, Ms Zee successfully doubled her company’s income, minimizes expenses and expanded throughout Peninsular of Malaysia and also Sabah & Sarawak.