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ACE INSTITUTE OF MANAGEMENT Affiliated to POKHARA UNIVERSITY

CASE STUDY ON

"Managing Motivation in a Difficult Economy"

Prepared by Raju Karki Rama Satyal Ramesh KC Sandeep Amir Kansakar Sanjeev Shrestha

Submitted to Shanker Raj Pandey

THEORETICAL BACKGROUND Motivation is the process that accounts for an individual intensity, direction and persistence of efforts towards attaining a goal. It is the result of interaction between an individual and the situation. Motivated person says "Nothing is impossible and put his best effort on the task assigned. The different organizational topics covered on the case are as follows:a. Organizational Justice:Organizational Justice is the overall perception of what is fair in the workplace. Disruptive Justice is the employee's perception of fairness of the amount and allocation

of rewards among individuals. e.g. How much we get paid relative to what we think we should be paid? Similarly, Procedural Justice is the perceived fairness of the process used to determine the distribution of reward. For employees to see a process as a fair, they need to feel they have some control over the outcome and that they were given an adequate explanation about why the outcome occurred. Finally, Interactional Justice is an individual's perception of the degree to which she is treated with dignity, concern and respect. b. Diversity and Age:Workforce diversity can be studied under two headings:i. Surface level diversity: This is the differences in easily perceived

characteristics, such as gender, race, ethnicity, age or disability that may activate certain stereotypes. ii. Deep level diversity: This is the differences in values personality and

work preferences that get to know on another better. Age:Analyzing the perception of older worker, positively they have tremendous experience, judgment, a strong work ethic, and commitment to quality. On the other hand older workers also perceived as lacking flexibility, and resisting new technology. When any organization actively seeks individuals who are adaptable and open to change, the

negatives associated with age clearly hinder the initial hiring of older workers and increase the likelihood they will be let go during cutback. c. Goal Setting:Goal setting theory says that specific and difficult goals, with feedback, lead to higher performance. Example:- If we set our goal to achieve CGPA of 3.8 out of 4, our performance will be much more better than just to aim to finish the course. Also, once we accept hard task, we will exert a high level of effort trying to achieve it. d. Changing Nature of work:There are various factors that help to change the nature of the work. Some of them are:i. ii. iii. iv. v. vi. e. Nature of workforce. Technology Economic shocks Competition Social trends World politics

Organizational Downsizing:Organizational Downsizing is a systematic effort to make an organization leaner by selling off business units, closing locations, or reducing staffs.

FACTS OF THE CASES R3-Mart is a major regional player in the retail industry and has 100 of stores. A sharp decline in the economy has put the management in a serious financial position. The firm had to close quite a few locations, reversing its expansion plan. Hari Prasad is the vice president of human relation and has been struggling with how to address the issue with employees. A few angry blogs developed by laid-off employees have made the morale and public relations picture even worse The average age of its workforce is increasing rapidly. The employees insecurity was taking a toll on attitude. Vice President was himself not sure of how to respond to employees hopelessness.

ANALYSIS OF THE CASE The case is very interesting and involving. It perfectly sketches the sudden risks that an organization is prone to in a changed situation. Further, the case has also emphasized that human resource is the most crucial and dynamic resource of an organization and having it demotivated means crumbling down of the organizational success. Therefore, the case also presents various programs which may increase the motivation level of employees in such complex happenings. To better understand the case, we will need to look into various dependent and independent variables of the management system because their interplay is vividly presented in this case: Dependent Variables *Productivity: It is dependent on goals by transforming inputs into outputs at lower cost. Thus productivity is dependent on both effectiveness and efficiency. *Turnover: It often cost the organization people it does not want to lose. It increases recruiting, selection and training cost. *Deviant workplace behavior: Deviance can range from playing music too loudly to violence. It may be a direct consequence of employee dissatisfaction.

*Job satisfaction: A positive feeling about your job resulting from an evaluation of its characteristics. Independent Variables Independent variables are presumed cause of some change in a dependent variable. *Individual Level Variables: When individuals enter in organization, they are bit like used cars. Therefore, Managers, unlike parents must work with used, not new, human beings whom other have gotten to first. *Group Level Variables: The behavior of people in groups is more than the sum of all the individuals acting in their own way. *Organizational System-level Variables: The design of the formal organization, the organization's internal culture, its human resource policies and practices, and change and stress all has an impact on the individual and group dynamics of the employees. A very renowned and successful company, R3 mart, has suddenly faced economic decline. Rather say, unforeseen crisis for which company was not prepared. As a consequence, the organization is compelled to resort to downsizing. This has created situations which have left the employees of the company feel insecure about their future and also frustrated. Productivity of the employees is sure to suffer and turnover is bound to increase. The drive of the employees to achieve their goals in the context of organizational settings is also going to be hampered. Since their individual level variables (characteristics, attitude and the culture with which they are modeled) are unique to each of them, their individual and group dynamics are certain to be adversely affected. In changed organization system level- variables, the organization has a huge challenge to minimize such counter effects of the situation. As a way out to keep the employees motivated, the HR has proposed 5 different sets of management program. Program 1: Providing Employees with no information or opportunities for participation and continuing to stay the course.

Program 2:

Track employee absence and sick leave and sharing it with employees and giving feedback about things they can control.

Program 3: Program 4: Program 5:

Track sales and inventory replacement rates. Sharing information and conducting weekly brain storming sessions. Brainstorming but doesnt share information about the employee's behavior or company profits.

HR assumes that the 4th method is the most effective method. In this method managers share information and conduct brain storming sessions. There should be organizational justice while we are conducting the brain storming sessions as there might be conflict between the employees regarding their ideas and opinions. Organizations cannot live in fantasized world. Situations will keep changing. Adversities like economic decline and others will keep occurring. It cannot expect an ideal and favorable business atmosphere throughout the journey. The least an organization can do is to anticipate such happenings and stay alert. It is the responsibility of the organization to keep their employees enthusiastic, motivated and devoted to it in the face of even the worst adversities by being able to make the employees relate to their importance in the bigger vision. Until and unless the employees imbibe in their heart mind and soul that the ultimate goal and the vision of the organization is also theirs, they will not inherently be aspiring to work for the organization. Therefore, each and every staff must be made feel important how every single effort of theirs contribute significantly to achieve the organizational vision. The leaders should be able to incorporate a feeling of mutuality in the employees by involving them in the situation. Involving in the situation would mean inspiringly telling the employees about the present condition of the organization, the challenges the organization is facing and how not tackling it would mean debilitating the chance of reaching the organizational goals, and finally how everyone's dreams, ambitions and aspirations are related to these goals. Employees will then contribute their ideas to find a resolution to the crisis because they are the ones with hands on experience to also understand the difficulties. The management must be able to include these ideas smartly in the

problem solving step by giving proper explanations that why they are accepting a particular idea. As a result it will help to increase the motivation level and they feel participative. This will inspire the employees to be whole heartedly involve in uplifting their company from the crisis because now they see this uplifting very much as their own issue, own achievement, and own success.

CONCLUSION Employee involvement is necessary in this organization. The underlying logic is that if we involve workers in the decision that affects them, then they will be motivated, committed, satisfied and more productive. To motivate people on their job it is necessary to emphasize on the factors which is associated with the work itself such as recognition, responsibility and achievement. A person shouldnt be demoralized even if the situation has worsened. A person should have a clear sense of purpose. Share information with the employees so that they can perform better. Employee should participate in decision making. Communication between employees and top management should be there. Weekly brain storming sessions helps employee determine what they can do better in the future