1. What problems existed at Traveler Import Cars? What are the symptoms?
Randy and Beryl, a married couple, created Traveler Import Cars, a car dealership that begin its operation by selling a brand of Japanese cars. Randy worked for many years in the car dealerships as a partner of Capital Imports, a car dealership that sells expensive European automobiles. Beryl was an MBA graduate with professional experience on car dealership as a consultant. Together they created Traveler Import and they incorporated some employees from Capital imports, including mechanics, salesman and Stuart Graham, who became general manager of the company.
Founders viewed their dealership as a family. They believed that creating a democratic environment will allow all employees to be involved in decision making and to feel important in the dealership. For this reason they decided to create a quality circle, where 5 non-supervisory employees could bring insights and opinions during monthly meetings with the managers. This managerial strategy was successful while the dealership remained small. The company’s growth started with the acquisition of a car leasing company, and later with the acquisition of another car leadership that sold another make of Japanese cars and an expensive European make. While Randy elected to spend most of his time in the car leasing company, Beryl became chief operating officer for the new car dealership.
Problems began for Beryl as these new dealership had a lot of previous problems so it demanded a lot of time from her. Her work load was excessive. At the same time Beryl felt that managers and supervisors at Traveler Imports, with five years of experience at Traveler Import Cars, were not performing as what it should be expected. Decisions taken by managers were not being implemented by lower level employees such as mechanics and salesman. Further employees were coming to work late and taking excessive lunch breaks. As a solution Beryl hired two new managers but problems remained almost the same.
Despite Beryl’s intention to create a family-kind company it has not been useful to maintain managers and employees highly motivated. Absenteeism and reluctance to follow orders are signals of low motivation. From what it could be read on the article it seems that there was a lack of motivator factors at Traveler’s dealership that could promote effort and satisfaction on employees. Physiological, safe and security needs were covered by company’s incentives but they were not enforcing employees to reach higher levels of personal satisfaction.
Bery’ls hired a private consultant that could help to straighten out the quality circle. The consultant, J.P. Muzak refused to work only on the quality circle unless he was permitted to conduct a thorough need analysis for the company. Some of the problems found are the following:
Goals.- Company’s lack of philosophy for setting goals. No connection between manager’s and subordinate’s goals. As a consequence motivation of both managers and employees was very low. Need for achievement could not be created if employees don’t have a clear idea of what are the main objectives of the organization and how these objectives are related to their needs of personal achievement.
Organizational structure.- Some subordinates were reporting to more than one superior, in some cases they were reporting to three different superiors. A lack of a clear structure generates that managers don’t have power of making decisions and this could provoke that managers and supervisors lose motivation. In the same way a poor organizational structure will affect motivation on employees as they might feel that their work and duties at the organization are not valued as they might expect. Finally it seems that at the top of the organization there are no major problems compared to what is occurring on the low levels, and this could be seen with operational control problems that the company is facing.
Communications.- There seems to be a problem of communication throughout the entire company. Communicational problems between departments are also evident. Some of the employees complain that managers are keeping information as secret. All this problems have a consequence on the relationship between all the members of the organization. Supervisors and managers appear to be protecting their own interests and are not working as a team.
Performance Appraisal and Wage Salary Administration.- One of the main components that will drive employee’s performance are performance appraisal and wage salary administration. These two components are used by companies to manage employee’s motiviation. Salary administration should be used satisfy hygiene factors while appraisal is used to manage motivator factors. The company has not been able to manage these two components properly so as a consequence employee’s motivation is very low. This could also be related will problems on discipline from employees and it could have a contagious effect throughout the whole organization.
As a final conclusion from sundry problems described by the consultant it could be seen that the main problems in on the relationship between supervisors and employees. The family-company feeling is diminishing because managers are not be able to communicate properly with their subordinates. As a consequence even there are many projects and ideas to be implemented, employees face a lack of motivation to make them happen.
2. How would each of these theories explain the situation: (a) needs, (b) equity, (c) expectancy and (d) goal-setting? Which one fits better?
a) One factor of motivation is needs. These needs drive behavior and there are rewards satisfying those needs. There are lower-order needs like safety and security or psychological needs as well as higher-order needs. Belonging to a certain group, self-esteem and self-actualization are contained in the higher-needs. In case of Traveler Import Cars Mr. Muzak in his survey found out that there are numerous needs not matched with the work structure and people’s behavior. All the needs are to be classified as higher-order needs, since safety and security or physiological needs are supposed to be met anyway in developed countries. Hygiene factors are of no discussion at the company, so no lower-level needs are surveyed by Mr. Muzak. Instead only
motivator factors play are role. At Traveler Import Cars it does not seem to be possible to fulfill the need for achievement, affiliation or power. The need for achievement can be met through clear goals that are measurable.
But since there does not seem to exist a clear goal, besides the broad goal of customer satisfaction, people are wondering how to make superiors happy. Moreover, there is no obvious way of setting goals. Nobody knows who sets goals or who controls them. There is a clear lack of motivation resulting. This observation is even supported by the unclear information stream in the company. People are not sure where to report to or which decisions they are allowed to take. This observation is also a part of the lack of power people feel. Personal achievements and self-esteem and self-actualization are to be seen as no sufficient in the company due to a lack of qualified training and development. The need for affiliation is contradicted by the way the firm handles communication.
Meetings are unproductive and superiors do not fill in their subordinates about the company’s plans. Additionally, there appears to be low discipline in the company. Workers coming late amplify others non-affiliation with workmates or the company. This observation of low morale and the feeling there is no real family spirit anymore, maybe do the extensive growth of the company, even intensifies the non-existence of an tolerable affiliation with work. The need for power is undermined e.g. by the way the firm promotes or trains people.
Since there is no training people tend to learn through trial and error or are promoted in positions they are not ready for. This decreased the perceived ability to control its own work and the outcome. Furthermore, people might question the fit of others who were promoted without any adequate knowledge. This raises uncertainty and reduces motivation. The proven lack of feedback, follow-up or the unsatisfying will to reward workers by giving voluntary salary increases also shrink the perception of affiliation and power.
b) According to the equity theory people compare their input and output in different situations to the input and output of others. Inputs and perceptions can be adjusted regarding the input and success of others. Doing that they compare current situations to own experiences and to circumstances other colleagues or workers in a similar position are in. As soon as an inequality is noticed people adjust circumstances. Traveler Import Cars fosters the perception of inequality through its structure and non-punishment of improper behavior. The promotion of people in positions that are not passable could be perceived as an inequality by co-workers. If people invest the same energy in the company and see that others get promotion even though they are not qualified could lead to a reduction in own efforts spend for the company.
This a clear effect of relating someone’s effort to others in the company. But since there was a former company, the current own has arisen of, with a family view of business can also be demotivating for workers. Structures have changed, new people have arrived and unknown people that joined later get promotions other feel not justified. Here the motivation could diminish by comparing the current situation to an own one of a different company in the past. The survey asserts that there is a lack of feedback, goal achieving and monetary rewards. People could see this as low output or reward for their overall performance. Such a situation could be seen as unequal and as a consequence people tend to reduce their inputs do the non-obvious gain from work. If to them it makes no sense whether putting in high or low input they could reduce their effort at all.
c) The expectancy theory analyzes the link between effort, performance and rewards. People tend to attribute a certain effort and performance to attain a goal and gain subjective rewards. They decide what effort and consecutively which performance is necessary to reach a distinct goal. At the company Mr. Muzak discovered that there are no real goals, no performance measures, no rewards and different efforts people tend to invest. All this points toward confusing results to people and therefore puzzled perceptions of how to achieve what. As there are no goals people do not know how to attain a status where superiors are pleased and task are fulfilled. The bad feedback policy even deteriorates the outcomes.
The broad goal of customer satisfaction is no specific enough to give people guidance how to reach that goal. A unclear company structure also does not help the overall situation. However the goal setting may look, a bad rewarding system can be harmful to a company’s achievements because people don’t feel appreciated and linked to success. Moreover, the lack of training does not give them any instrumentality to rely on. Someone’s performance cannot be attached to the reward he expects. Summarized, as there is no reward or performance measure as well as no instrumentality worked out people cannot think of a clear picture how to come from a starting point to a final goal. By giving no point people can anchor to it is unrealistic to define even the effort put into a work that apparently is not defined or contains any rewards. The subjective reward of work is not defined or rather low in this case. Low rewards and uncertain ways of how to get to them leaves people without any orientation and motivation.
d) Goals set typically drive people to attain these goals, especially when these goals are useful to them, the goal is challenging but realistic and if there is a clear way to reach the desired result. Attractive goals help workers to focus and control themself as well as foster creativity and keep effort levels. Mr. Muzak by his findings points out that no goals are set in the company’s environment. Consequently, workers cannot attribute a usefulness or judge on the feasibility. Thus, achievements cannot be measured and there is no clear way toward a non-existing determined goal. As a result attention levels are low as well as self-control and efforts and creativity remain on a low scale.
The current situation at the company is due to no philosophy in setting goals. There is no discussion about who defines goals with whom. This leaves anybody unhappy and unmotivated to contribute to a common success. Reporting and giving orders also seems to be undefined and meetings do not bring up productive results. Muzak as well recognizes that managers do not delegate enough. A good delegation and discussion about tasks could help to overcome the resulting absence of goals. Moreover, policies and programs are not followed stringently. A shift and even disappearance of them emboldens goals to vanish or become distorted.
In our view goal setting fits best for a beginning of an analysis. The absenteeism of goals is the root cause of all problems unveiled by the survey. Workers tend to lose interest in working hard on achieving something that is not defined clearly. That brings us to expectancy as well. Since there are no goals or rewards, people cannot figure out what measure to take or instruments to be applied appropriately. Their amount of effort remains unspecific. All the perceived unclearness could lead to the equity theorem because people that are unmotivated do not tend to be work in the same manner for success. Inequalities in rewards or inputs are followed by adapted behavior of others who feel treated unfairly. As there are needs to achieve success, improve oneself or empowerment, the theory of needs also fits the case, but to lower extend. The four theories determine and bias each other significantly.
3. Using your knowledge of perception and attribution, evaluate the situation.
From the lists of the problem areas that Mr. Muzak pointed out, we can see that from the beginning of the establishment of the company, many attribution biases led to the situation.
First because the dealership is the part of a Japanese corporation, whose culture of the organization is emphasized as a “family”, Randy and Beryl shared the same organizational culture and have given priority to the “family” values they embrace over the business’ goals. It shows projection bias. This value gave rise to a lax environment within the firm and the employees do not feel accountable for incomplete tasks, they are viewed as family members rather than employees, and thus have no motivation to complete them.
Regarding to the leadership value, actually in the beginning Stuart Graham had different opinion of value with Beryl, while he understood that the democratic value was the preference of Beryl, so he tried to pretend to be democratic. It shows projection bias.
Stuart Graham was appointed as the general manager of the firm due to his experience in the Capitol Imports, but without considering his characteristics and capacity. Here it shows halo effect and selective perception bias. And some manager positions rose from the employees of the firms who had never received formal managerial training, even some of them were lack of the quality of being a manager. It also shows halo effect bias. The lower managers and pool leadership resulted in the expensive consuming of resources and time, so that many problems existed in the operational control system.
4. Using your knowledge of personality, evaluate the situation.
In terms of personality the case study presents two clearly distinguished types of personalities among the characters in analyze.
Randy Traveler and Beryl represent clearly a Type A personality, they have an intense desire to achieve, they look extremely competitive and they have a strong sense urgency. This behavior was visible since the moment they decided to go into business for themselves. They put too much effort on their work, for example the business growing and the acquisitions made, it took so much of her time as well as physical and psychic energies.
On the other hand, it’s possible to identify a clear Type B personality among the subordinates of Traveler Import Cars, Inc., they tend to look easygoing and relax. This was mostly visible in their behavior, for example when the programs were initiated, but were permitted to drift and disappear. The important deadlines were being missed with increasing frequency and the mechanics and salesmen were coming to work late and taking excessive lunch breaks with greater frequency.
5. What change should be made in this situation?
a) To solve the problem of the ambiguity of the company’s goals, first we would help make the organization’s goals and personal goals clear. Once the goals are clarified, job satisfaction will increase and the employees will feel a sense of purpose. They will be more responsible and efficiency.
b) To successfully solve the problem of the company’s structure, a new job design should be created so that it clearly states the role of each employee. Policies and procedures should have been changed as the company expanded. This would have given the organization a more stern structure.
c) To make the employee more initiative, motivation should be necessary such as extra fringe benefits, bonuses and salary increasing annually. Another way to motivate employees would be supplying them training programs in the respect areas. These will teach employees new skills as well as create excitement about their job. They will learn new methods and techniques to apply at their job site, learn to use and apply new technology and learn new friendly competition styles. This should increase the employee’s enthusiasm and satisfaction levels.
d) Performance evaluations must be completed so that employees can receive feedback on their productivity and to ensure that the company’s goals are being met. Additionally, employee evaluations allow management to know how well the employees are doing in the organization and receive feedback.
e) To solve the problem of the poor leadership and lower managers, it should hire some experienced managers from outside and at the same time supply the training process to those potential managers. Furthermore Beryl should delegate responsibility to other managers and allow them to make key decisions, which will give the managers a sense of empowerment and responsibility.
We want to state that by implementing all the changes in the company we would clearly overcome all the biases and guide the company toward a better goal setting, equity and expectancy. By enhancing the communications and all the betterments mentioned before in the analysis you can balance the two extremely different types of personality. This could lead to a new philosophy, a more balanced structure of the company.