Human Resource Management

Medical and Environmental Electric Devices Corporation (MEEDs Corp.)

Written Case Analysis

Submitted to: Prof. F. A. Fareedy Teaching Associate: Ms. Haadiah Qaiser

Group Members Fahad Asif Saiba Mian Zaid Nomani Zara Naqi

MBA-II Section-A Lahore School of Economics

expert labor hence the labor market was tight. and when that happens – the employee is ready to leave the company for other. Talking about the IC group. the case talks about how it is becoming extremely difficult to find employees. For the purpose of doing so. manufactured. 1 . have been on the rise (if seen on an overall basis). with no defined parameters or rules. The company acquired its name in 1964 and by 1979. There is an ever-increasing demand (especially in the case of technical and managerial skills) but there is not enough supply. The organizational culture however is informal and ambiguous. a separate department is created by Tom Douglas. sold and serviced complex medical and environmental control systems. ICG was not MEED‟s major supplier as it bought 80% of its supplies from other companies but ICG was like a laboratory to MEED as it fell in its umbrella. Problems Identified: A number of problems persist within and outside of the organization. With ever-growing needs of employees. it is an ever-evolving manufacturer of circuits which is transitioning as the technology is changing. Years are spent on technically training an employee. It had facilities throughout the world and the HQs were in Michigan. since then. several problems pile up and bring about various concerns for the management at MEED. Hence. HRDP. The sales and profitability of the company. MEED designed. Medical and Environmental Electronic Device Corporation (MEED) and its supplier of circuits – the IC group. it‟s becoming an industry norm to allure workforce from one place to another.Introduction and Case Overview: The case talks about a company. Whosoever offers more money becomes the employer. Let us take a look at them: External problems  The industry has a shortfall of skilled. MEED had achieved overall 31% market share in the area. The case centers itself around the dynamic environment and how ICG and MEED try to find the premise of their existence – skilled manpower.  In the industry that ICG operates. The poaching is increasing and workforce is decreasing creating a dilemma for ICG. which is also facing issues.

the high costs are a setback. there is no succession planning happening in the company. o This is over-burdening the current employees. causing instability in the workforce and internal management of the company. This business is also very expensive in the sense that the cost of producing chips is a lot. planning and personnel). There are no rules and no parameters defined which is why there‟s always a haphazard operational scenario.   ICG is not being able to meet the demand of MEED. Hence. o Exempt employees : 10% o Nonexempt employees : 20%  There is understaffing – there are 106 positions that are open and still need to be filled.   Relocation costs were very high – moving employees was next to unfeasible with the amount being $5000 per semi-conductor engineer brought from West Coast to Michigan. Internal problems:  The turnover rate is increasing. Let alone long-term goals. Tom Douglas (group manager ICG as well as plant manager Jackson was also reported of program management. 2 . it only fulfills about 5-8%. Organization culture at MEED and ICG is just informal and ambiguous. Hence life cycles of devices in the semi-conductor industry ended quickly. For instance. There is a lot of effort needed by companies to stay abreast of technology and there is an ever-increasing dynamic change in the circuits business with which ICG has to deal with.  There is a cultural fix – the West and the East Coasts both are opposites in term of culture and they don‟t settle in each other‟s domains.   There is no formal planning. There is a major scheduling issue – a very chronic problem. Planning wasn‟t even done at ICG. no conformities and way too much flexibility. Where it is supposed to pitch in 20% of MEEDs demand. Parts were being delivered to assembly units after several delays and the nature of the business didn‟t afford that (as technology changed at a very fast pace). Each person has to give in their 150% because there‟s a shortage of workforce. There are no guidelines.

None of the potential workers that are searched for are called. not even having semi-conductor background.. JDs. was running as plant manager Jackson. And the training was minimal. o Compensation system was not in place – incoming engineers were paid more than the previous engineers which was clear discrimination. engineers are given management position where they have no such background and vice versa.  The underlying problem is that “engineers are bad managers” and in this particular company. HR problems also exist. MBAs are needed in the firm as management is required. o There was no proper appraisal system in place. 3 . This is also leading to overlapping roles. o Employees were moving around – too much mobility was causing problems in planning.. there are no models and in the case it says “people don‟t know what a good manager looks like. o There were no mentors to help new hires to start out. But there is no formal program for recruiting MBAs. Engineers were moving „up‟ into management squeezing out recruitment of MBAs.” There is specialized recruitment that‟s being done – workforce is being found but there‟s no follow up.     No formal career development tracks were in place. There are no solid criteria. JSs are not specified. Tom Douglas.

And even the chips it was manufacturing. But due to high amounts of pressure the job required the previous managers had quit. Its operations were transferred to the Jackson plant in Michigan which was headed by Tom Douglas. all the plant managers of manufacturing were from semi-conductor background and had knowledge of how to run a plant. Furthermore. Mr. This means good chip as a percentage of chip starts. But ICG was also not able to fulfill this requirement and it was only contributing 5-8% as to 20% originally agreed contribution. the ICG was to fill the 20% requirement of chips of MEEDS and the rest of 80% were to be provided by outside suppliers. The manufacturing was initially done at a plant in Lansing. the company is facing many problems which range from managerial problems to human resource problems. Mr. But the issue was that he had never managed a plant before and although he seemed calm about it but it was having an effect on the operations of the plant. The performance yield of the Jackson plant was below of that of the industry. Douglas when made the Plant Manager was also the Group Head of ICG. Previously. When Douglas was made the manager of Manufacturing. The short-term problem that the ICG faces and should be solved immediately is that of finding an experienced plant manager for the smooth running of the Jackson plant in Michigan.Analysis As has been mentioned in the introduction. Apart from the above mentioned problems. While the industry yield was 71%. This shows that the operations of the plant were not efficient and even though Douglas knew the top management was not going to interfere but he realized that it was his responsibility. the yield of Jackson plant was at 65%. ICG was facing a lot of problems in its manufacturing which were spilling into other subunits as well. it was at a higher cost then being supplied by the outside suppliers. Michigan but due to high turnover and increasing expenses the plant was closed down. Moreover. so now he had a dual role and responsibility. the most critical of all the problems was that of Scheduling. Douglas was not able to develop and implement an effective schedule which resulted in 4 . before him 5 plant managers had come and gone in the short time span of four years. His expertise was not in semiconductor as he was an electrical engineer and also had a degree in management. the cost of manufacturing operations for the current fiscal year had exceeded by $11 million than forecasted.

000 a week. but still not enough technical training was being provided to them which was considered to be a major need at ICG. Staffing. Some of them have been successful while others used to think more as technical employees rather than managerial employees. Barbara was made the Director or HRDP to do employee forecasting for managerial and professional personnel. Engineers felt that no special attention was being paid to their career development and they were of the view that engineer development was discriminated when compared with management development. Mr. the technical employees. As has been mentioned in the case that the search can take time of up to 6-8 months due to lack of expertise therefore the HRDP Director. Managers have extremely important functions to perform in a company: Planning. they were a part of the problems. 5 .production delays which in turn meant delays for volume assembly. They don‟t have the decision making and planning mind set. Organizing and Controlling. The semi-conductor industry has very short lifer cycles due to continuous innovation and delay in production led to the design becoming obsolete more quickly which ultimately resulted in lost sales of approximately $100. Ms. Due to the above mentioned reasons and explanations. to managerial positions. they have been promoting engineers. Barbara should be ordered to search for potential plant managers. Leading. Even though there was no management development system in place and the company was not even hiring MBA‟s for management positions. Currently. But they will soon need to change their policy and bring in MBAs for managerial jobs. Douglas should immediately start searching for an experienced plant manager for the running of Jackson Plant. It was a pattern at ICG that engineers became managers and as every manager knows that „Engineers make bad managers‟. One of the problems ICG was facing was lack of managerial depth. For instance it has been mentioned in the case that „Engineers don‟t care about managerial tasks like reporting. This means that ICG did not have enough knowledge base of managers and they did not have a policy to hire MBAs. ICG was also facing a number of other problems.‟ they are more interested in challenging projects and for this may even ignore recruitment duties. Although the problems were not directly stemming from lack of utilization of Human Resource functions. All of the functions from the basis of a managerial job which needs to be performed. Even though the company was in dire need of experienced engineers and technicians.

so that. So HR personnel and the line manager need to coordinate and handle the situation in such a way that employee morale is not compromised. If ICG fills in open position externally. Moreover. A total of 106 open positions are at ICG and they have to be filled. the problem is that not enough college graduates are coming out every year to meet personnel requirements of ICG. people with managerial background so that they could manage their operations efficiently. To do this efficiently. internal hiring might not be fruitful if an employee applied for the open position and got rejected. Also according to ICG hiring requirement projections in Exhibit 1 and 2 of the case reveal that if they do not start hiring people now than they might start facing more operational problem. Another external source of recruiting for ICG is attracting employees of competitors. It should be in Barbara‟s responsibility to develop these two things. especially. The good thing about this option is that it creates a good pool of applicants for the open positions. The College Relations department could work with the deans of the universities and design the course content which would be more practical. then it has quite a few options. Firstly. Most of the companies prefer internal recruiting before jumping to external recruiting. ICG should hire from internal sources if the right person is available for the right job at the right time.So it is evident that ICG need to recruit more people. they need to develop two things: (i) Succession planning and (ii) Skills inventory. college recruiting is an option. the students could get exposure to the real business environment before they even graduate. They can also offer them internships. However. But the question is from where to recruit people? These could be recruited internally or externally. On the positive side. it has been mentioned in the case that if a semiconductor engineer is hired from another company then 6 . Such a situation needs to be handled very carefully. ICG should invite university students for an On-Site visit of their company and make them familiarize with MEEDs culture. it would have several advantages and disadvantages. So the supervisor would know which person is best suited for which job. And they would require less orientation and training than the outsiders. Although. The College Relations department of ICG is already trying to establish good relationships with many universities to attract potential employees. the internally hired candidate‟s strength and weaknesses would have been known to the management. in case of ICG. They would have high commitment and high moral if they are being promoted. on the down side. If ICG fills in open positions internally. But it is very costly and time consuming.

However. Also they should be informed that MEEDs is growing at more than 30% growth rate and it has the highest market share (31%). So the future prospects are bright for this company and also for the employees of this company. The culture of MEEDS and ICG is such that they don‟t fire or lay off people even during the times of recession. if they are given higher salaries and more incentives along with the assurance of career development then they would stay.he/she would mostly likely be relocating from California to Michigan which would be very cumbersome for the employee and moreover he/she might not get adjusted in the environment of Midwest. They believe that even if a whole equipment system has been messed up by someone it can still be fixed up instead of scrapping it. 7 . Their culture is opposite to that of a semi-conductor industry culture. firing them if seen as incompetent. MEEDS also need to change its culture to attract more semi-conductor experienced engineers and technicians because they would be the best ones to run a semi-conductor manufacturing plant. freedom and it lets the employees do what they want. it is also facing the dilemma of culture conflict. Therefore. MEEDS culture is ambiguous. The semi-conductor industry is said to be extremely strict and harsh with the employees. Semi-conductor industry needs discipline and planning which is not part of the MEEDS culture. Not only is the company facing recruiting problems.

JD & JS Manufacturing – High turnover and expenses Lack of Succession planning Role of HRDP ambiguous  Opportunities:           Work in collaboration with local universities like Wang Employee retention programs – Incentivize Formal Structure Reducing the duration of training Proper follow up with candidates Offer internships to the passing out engineers Channelize growth constructively Training Centre Standardize policies across the board Fill key positions at the earliest  Threats:      Scheduling – Delay and losses Shortage of supply of engineers Attraction and relocation of candidates is different High turnover Intense work load may lead to existing managers leaving 8 .8-9% when 20% is expected Over lapping positions – Dual reporting Informality in the structure – leading to ambiguity Excessively technologically advanced Lack of Specialization No program to hire MBAs Excessive duties on one manager Unclear JA.SWOT  Strengths:        Excessively growing Sales Technologically advanced Freedom & Flexibility for Employees Rapid Growth No Union Good employee treatment and help No layoffs despite recession            Weaknesses:  ICG’s supply .

But the problem at hand. it would cause mayhem in the organization. there is a bleak supply of engineers that can possibly meet their demand and if the existing ones were to leave.Recommendations One of the gravest issues facing MEEDS right now is that of lack of labor available in the market and the type of expertise they are looking for is not only extremely scare but most of the engineers do not even possess those skills and do not have an understanding of the technology that MEEDS is using. as of now for MEEDS. consequently. a wise thing to do for MEEDS is to work in collaboration with the local universities which have candidates mostly from the local area. need to develop themselves and build on a more formal and streamlined structure. thus they need to make this structure more formal and based on standard protocols that need to be followed so the work is properly channelized and there is low wastage of time. as it is. Training is the most crucial factor. because. One of the most lucrative universities is WANG. Therefore. MEEDS being an organization with an extremely informal working style and structure. decreasing turnover. There are no standardized operating procedures and neither do they have a formalized handbook or procedures manual that the employees need to follow. taking into account the training is the length of 9 . people leaving means they go behind their schedules and their entire production cycle is messed up and would yield them losses. There is a high probability for them to leave because the employees are overburdened with work due to under staffing and they need to be incentivized to stay with the firm because as it is mentioned. because of the fact that the supply for the kind of labor they are looking for is near to zero and thus they need to train the employees to get them familiarized. which is seen as the upcoming MIT. Proper monetary as well as non-monetary benefits to make the existing employees interested in their job would be a good way of making them stay with the organization. they can retrieve very promising candidates from there who have the needed skills and are also familiar with the area and other extraneous factors that led to engineers from the west coast leaving within three months. One thing MEEDS to focus on is how to retain their existing employees. If the management at MEEDS works in collaboration with the management and deans at WANG and provide them with the exact profile of the candidate they are looking for.

Another concern that stems out of the previous problem is that of a proper allocation of work on part of the engineers. no matter what size they have and what business they are operating in. They have been assigned with duties that they should not be doing and there is a lot on their plate so if there are overburdened.the training.e. Succession planning is the backbone for the smooth running of any organization. because key positions are the ones that make or break an organization because they need to control and plan the organization‟s working. it takes three years for them to conduct an entire training of an engineer and for him to be totally adept to the procedures and technology at MEEDS. it is probable that the employees might not be able to do any of the work correctly. They say that the pool is built but the candidates are never contacted. it is highly doubtful that they would want to lose candidates because there is already a shortfall of about 20.000 candidates in the market and thus they would not want to lose candidates like this on their own. of the plant manager and the operations manager and only one person. If they would waste so much time on training itself. They need to take remedial measures to shorten the training which can be done by providing universities with curriculum of what they need from the candidates so they are trained in advance and only their polishing needs to be done. This severely needs to be shrunk given the market dynamics and the supply of labor and their increasing size by the day. job description and job specification of every position needs to be made so everyone knows their tasks and responsibilities and work constructively and efficiently. Douglas is looking after all of these responsibilities. It has been highlighted that the recruitment staff is providing the line managers or engineers with a pool of candidates that they think are suitable for their jobs but the managers are not following up with these candidates. The issue facing MEEDS right now is that two of their key positions are open right i. A proper succession planning procedure needs to constructed so the organization plans for unforeseeable leaving of any key position holder and their probable candidates can handle and take charge of the position quickly without causing undue pressure on one person and ensuring smooth running of the organization. Now this needs to get streamlined at the earliest. So a proper job analysis. it would harm the productivity of the firm. 10 . Given the condition MEEDS is in right now.

which should not be the case. 11 . where specialized business management and administration personnel are hired who can look after the management side of the business and keep the engineers free to do the job they are suited for.There also no formal procedure to hire MBAs at MEEDS and they really do not understand what a management personnel is responsible of doing so it is advisable for them to create such a program. rather they should hire MBAs. There is a clear case of person job fit issue here where technical people are taking care of the management. who are business analysts and are capable of managing the operations effectively and efficiently.