Fab Sweets Ltd Case Study

Executive summary

This study reviews the case of FAB Sweet, a producer of confectionary. The firm is currently plagues with several internal and human relations problems which reflect on its overall output. The issues and their causes are evaluated in a theoretical context focusing management philosophies such as Taylorism, bureaucracy, job enrichment and organisational culture. These issues are discussed in SECTION A. SECTION B sets out a management action plan for organisational development by recommending several steps or actions based on the theoretical literature, which could improve the current state of the firm. Like every change management program in every organisation, problems are envisaged and anticipated. The potential source of the problems and ways to mitigate the problems are noted in SECTION C. The main issues arising from the case and highlights of the central themes are including as a conclusion in the final section.

Introduction

As this assignment suggests and provides some solutions and best practices of HRM in the Hard Boiled Department of FAB Sweets LTD, which is a manufacturer of high quality sweets in the north of England, it becomes necessary to firstly review and identify what are the problems and their causes in order to find appropriate solutions based on HRM practice. In particular, the department of hardboiled (called HB) has the main problems which need to be solved for this reason I have been appointed to find solutions for their problems. There, I tried to deal with these issues in the point of view of HRM perspectives and analyse the problems logically which means provide possible solutions for this case depending on their ability and budgets as well.

First of all, it seems that the work atmosphere has many conflicts whether between employees or their managers. However, the problems are not only related to the poor relationship between managers and their employees but also it reflects on the productivity and efficiency of the firm. Related to this aspect, the case highlights the fact that the department of HB is the worst department in the factory recently in terms of atmosphere, attitude and climate. Therefore, I would say that monitoring the issues or problems firstly and trying to understand their causes is the first step to suggest and provide appropriate solution to this case.

SECTION A: Issues and their causes

First of all, it is clear that because of the issues and problems in the HB department, there was a high level of labour turnover. One of the main reason which is concerned is there were six managers in eight years. Basically, it has happened for some reasons so as I said above turnover is one of these reasons. Every new manager has his own strategies and methods of managing the work. Most of the time, new managers need time to adapt to the new work atmosphere whether he or she has a good experience or not. So this will definitely affect the productivity of the factory and the quality of the produce.

The work atmosphere seems boring as employees complain frequently. This is especially true with the production department mostly because they are always focused on doing the same tasks day-in day-out and are not sufficiently rewarded. Only they can get it in one case which is mastering all the skills for all the lines and you should be ready to cover any work in the factory. The manager’s excuse for this is that employees are trained on a variety of tasks and accorded several skills which are rarely used in the work environment.

Again there is a poor and dilapidating relationship between stemming from dissatisfaction from their wage scales, their grades, and the work pressure especially in the afternoons while their supervisors do not provide any compliments or positive feedback. There are other problems stemming from conflicts between women (packers) and their supervisors and also between supervisors of the tow sections of HB. Both supervisors turn to blame each other for breakdowns and other problems within the firm which might be the results of the excess pressure put on them by the managers.

The issues highlighted above can be attributed to several management issues or flaws documented in the management literature. These include aspects of Taylorism, bureaucracy, job enrichment and organisational culture.

Taylorism also called scientific management was a management philosophy introduced by Frederick Taylor at the turn of the 20th century. The philosophy advocated that employee performance could be improved through studying work processes, including rest breaks, using financial incentives and giving workers the right machines (Kanigel, 1997). Taylor did not consider a human dimension as a factor that drives performance. Kanigel (1997) noted that the basis of Taylor’s philosophy was that ‘workers could not be relied upon’, ‘lacked talent and intelligence’ and therefore ‘workers should be told what to do and when to do it’ (Kanigel, 1997). This school of thought has heavily been criticized by proponents of the human relations theory such as Elton Mayo, Henri Fayol, Victor Vroom and Abraham Maslow (Kyle, 2006). Some of the principles proposed by Taylor still remain useful today and have been the core of several highly successful firms. FAB Sweets still employs techniques that were proposed by Taylor but do so poorly (even then) by not considering the role of machine effectiveness and financial incentives in improving performance.

The firm is also very bureaucratic in its structure with several layers of management. This slows down decision making, reduces flexibility and reduces effective communication between employees and management (Garston, 1993). This might be the reason why the poor departmental conditions have persisted for very long. It might also account for the high managerial turnover experienced within the firm.

There is lack of job enrichment and this is manifesting itself in the form of boredom at the work place as indicated by production staff. Frederick Hertzberg developed the idea of job enrichment in the 1950’s. The concept asserts that the job of employees could be significantly enriched by allowing employees to use a range of their skills. Hertzberg contends that job enrichment could be attained through allowing employees to perform a range of different task that challenge them both mentally and physically, structuring work programs to allow for complete and meaningful work, and by fostering communication providing feedback and encouragement (Hackman and Oldham, 1976).

Hill and Jones (2001) contend that an organization’s culture refer to the collection of values and norms that are shared by employees, groups and teams within the organization and that control the way these individuals and groups interact with each other and with the organization’s external stakeholders. The organizational culture within FAB Sweets is simply despicable as there are no established positive values shared within the different work teams. There is lack of respect between employees or departments, there is a strong blame culture between departments and these factors do not support productivity.

SECTION B: Management action and Development plan

Improving Performance through feedback

There are major problems related to the assessment of employee performance in this case study. Basically, managers link their performance to their production output regardless of the physical abilities and efforts of these employees. Nevertheless, they have been blamed for being less productive and efficient. Moreover, there is no clear and effective feedback- positive or negative, about their performance. Feedback will help the employees to improve their performance. In effect, using a good performance appraisal system in a case like this is important as it mitigates conflicts and improves the probability of achieving success. As a part of HRM, performance appraisal is an important tool that managers use to evaluate the work of their subordinates and to develop clear goals and objectives relating to the work of subordinates in the future. Performance appraisal will also assist towards employee reward systems such as bonuses and promotion. There are several appropriate approaches of performance appraisal which are recommended in order to solve problems or issues relating to performance.

Performance appraisal will useful first of all, because no feedback system is used in the factory and employees complain that they receive little or no information about their performance. Using feedback will there for useful for both employees and managers as it evaluates performance and gives the employees information about their efforts in the factory. The literature on human resource management highlights the benefits of feedback. Armstrong (2000) recommends the use of a 360-degree feedback program which he describes as a ‘multisource assessment or multirater feedback. The implication of this is that employees are rated by supervisors, managers, co workers and through self assessment (Fletcher, 2004). The benefits and advantages of such a system lies in the fact that it its proven, efficient, gives a clear vision and effectively assesses the performance and behaviour of the employees while also allowing them to gain feedback and commendation of their efforts. This will also improve and encourage a spirit of teamwork which is absent in the factory by encouraging all workers (managers, supervisors and employees) to get a holistic view of their performance and how it can be further improved.

Improving Satisfaction through Empowerment

With regard to employee’s satisfaction, the evidence points to the fact that employees are completed dissatisfied as concerns grading and payment level. Related to this aspect, Calderblon (1988) suggested that employees should be encouraged to participate in identifying problems related to their performance which may increase their satisfaction. This therefore implies that it will be a good idea for factory managers, supervisors and factory workers to work together to highlight the problems they face and make suggestions on how these problems could be resolved. As confirmed by the employees in this case, they had few decisions making responsibilities, they were unmotivated and their job satisfaction was low. James (2009) argued that employees’ involvement in decision making increase their satisfaction and performance.

Empowerment is a concept that has been met with significant interest in the field of human resource management. Its importance and relevance has been highlight by several researchers (see Paul et al., 2000 who have advocated the need for new methods of management that encourage employee involvement, participation, autonomy and the promotion of self managing work teams. Paul et al., 2000 and later Cohen et al., 2007 have provided theoretical and empirical evidence to assert that empowerment significantly improves wellbeing at work place, improves the motivation of employees, improves employee commitment, hence employee performance and the overall job satisfaction. Empowerment is defined by Spreitzer as ‘increased intrinsic task motivation manifested in a set of four cognitions reflecting an individual’s orientation to his/her work role; meaning, competence, self-determination and impact’ (Spreitzer, 1995, p 1443). Employees at FAB Sweets can be empowered through improved and meaningful delegation, improved work environment, training and development and effective feedback systems.

Job rotation is an aspect which could be easily implemented within the firm. There is no reason why workers should be segregated and given different tasks based on their sex. Job rotation should be allowed for to reduce boredom therefore improving productivity amongst staff.

Rewarding and Motivating

As I noted above on the issue of performance, it is important to get information on the efforts of workers so that good performance and good efforts should be rewarded appropriately. Appropriate reward structures will help the managers and the firm towards the achievement of goals and it will spur competition between workers to improve their performance. There is however no effective reward system or structure within the factory. There is therefore no reason for employees to spend effort or improve skills as this does not benefit them in any way. The 360-degree system (Armstrong 2000) can be used to gain feedback about employee performance and the goal could be to gain an insight into the performance of individual staff in order to apportion rewards effectively. Armstrong and Murlis (1988 p.256) argued that poor individual performance is more likely to be hidden within teamwork. In a factory of this nature therefore, it is important to assess each individual differently both to ensure effective apportionment of rewards and to identify staff with extra training needs. This does not nullify or undermines the importance of teamwork in this setting. A reward structure that considers rewarding both teams (production and packaging) as well as the stars within the teams should lead to an improvement in performance as well as to the development of stronger team working and collaborative tendencies with the department thus mitigating the existing conflicts between workers.

Equipment and innovation

Clearly the physical aspects of the work environment need to be improved. The machines are old and have resulted in a lot of scrap, wastage, inefficiencies and ineffectiveness. It has further aggravated tensions between the different departments (maintenance and production) due to their constant failures. The firm has focused on improving productivity through people without any consideration for the machines used in production. A capital allowance of £25000 means that a new, more efficient machine could be acquired or developed. Employee training will have to be organised to match the needs of the new machine. Training currently takes place on the job and there are no indications of a formal employee development process. Development programs could be scheduled. These programs could provide routes for factory level staff to gain training that will allow them to take up managerial positions. Such a scheme will improve the motivation of employees and certainly improve their productivity. It will also encourage staff to come up with innovative ideas on how work can be redesigned and performance improved. It shall congruently serve as a way to recognize and reward high performance amongst staff.

Organizational culture and values

In keeping with Taylor’s principles, the firm provides consideration for human development. Workers are currently treated as factors of production without any regard for their feelings. There is need for a revamp of the system from top to bottom. Senior management will need to formalise or reintroduce the values of the firm. There is need for employees to feel valued by firm and top management as this empowers them, improving their sense of belonging and hence their productivity. When strong values are highlighted, they should be accompanied by clear goals and objectives which will give the employees guidance on what is expected from them.

SECTION C: Potential problems in change implementation

Research has shown that employees are susceptible to resist change in many instances (Armenakis et al., 1999). Their resistance stems mainly from the uncertainties surrounding change programs (Clarke, 1994). To successfully push through changes, employees need to be empowered to accept, embrace and support change programs (Clarke, 1994). Employees can resist change in several ways such as Union activity (strikes) or deliberate non-conformance (Armenakis et al., 1999). At FAB Sweets, I anticipate that packaging staff will resist proposals regarding job rotation especially if they will have to take turns in the production department. Employees at the production department may resist proposals for the use of new machines because it will necessitate further training with brings up other uncertainties.

The way forward is through employee readiness and employee involvement in the change process (Armenakis et al., 1999). Employees should be informed early of the new changes that will be instituted; they should be given a clear idea of what it will involve, how they will be affected, how it will benefit them, what kind of assistance or support they will have to help them cope with changes and what their role in the process is. Again, employees from several departments could be used as change agents to drive change and facilitate the process.

Conclusion

The case highlights a classical set of problems faced in many firms around the world where managers set high productivity requirements but their underlying firm operating environment does not permit such standards to be achieved. Many production firms employ several pronouncements of Taylor’s scientific management philosophy but fail to consider the human relations side of production and the potential for human relations to improve productivity. A careful review of the case of FAB Sweets highlights some of these problems briefly. A set of recommendations have been made which if implemented will improve the work environment and the overall productivity of the firm. These aspects include employee empowerment, a review of the organizations culture, equipment and innovation, reward schemed and motivation. Changes are never a smooth process within firms but change can be managed successfully if a proactive approach is adopted. As proposed by Amenakis et al., (1999), the institution of a change readiness program as well as employee involvement in the change process will help to improve the success of the change program.