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Human Resource Management

Friendly Financial Works is a fictional provider that sells accounting, payroll, and financial services to small businesses.

Please read the six cases below and answer the questions at the end of each case. All answers must be written in American English.
1. Friendly Financial Works is a fictional provider that sells accounting, payroll, and financial services to small businesses. The company uses an integrated software platform to help small businesses better manage their financial assets. Based on the assumption that small business owners often lack the expertise and time to manage financial assets effectively, Friendly Financial seeks to provide a relatively inexpensive “one-stop solution” for financial planning and control.
Friendly Financial’s business model calls for providing services at the lowest cost rather than giving customized service to each client. To be successful, Friendly Financial needs to lower its costs by continually increasing the number of small businesses that use its services. The success of Friendly Financial thus depends largely on its sales force.
The sales force is divided into geographic territories, with a territory manager having exclusive responsibility for all sales activity within a specific area. Territories are organized into sales districts. The average number of territories in each district is 20. Each district is led by a district sales manager who oversees all personnel activities, such as hiring and training, in the territories within his or her district.
Territory managers are paid on a commission basis. They generate most of their sales by cold calling on potential businesses. A typical day consists of 10 to 15 unannounced visits to small businesses. The territory manager seeks an appointment with the owner or manager of each firm he or she visits. When an appointment is granted, the territory manager makes a presentation and tries to develop a contract between the small business and Friendly Financial. As with most unannounced sales calls, a large majority of visits end without a contract to provide services.
A major concern for Friendly Financial Works is identifying and keeping enough territory managers. The turnover rate is approximately 200 percent each year. This means that a district sales manager must usually hire about 40 new employees in a given year. In most cases, when a job vacancy occurs, the district sales manager travels to the sales territory to begin recruiting. The district sales manager places an advertisement in the local newspaper and includes a telephone number for potential recruits to call. The manager then spends three to four days at a local hotel answering phone inquiries and conducting interviews. The territory manager position is usually offered to the best available candidate on the final day that the district sales manager is in the territory.
District sales managers pride themselves on being able to land the sales representatives they like best. Many district sales managers boast that they can sell anything to anybody, and this is how they approach employee recruiting activities. Because they are talented sales representatives, district sales managers generally do a great job of touting the benefits of the position.
Questions:
What aspects of the recruiting process increase the likelihood that territory managers will leave once they have been hired?
Should Friendly Financial use other methods to recruit territory managers? Which methods?
Is the recruiting process at Friendly Financial efficient? What are some things that might be done to reduce recruiting costs?
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2. Stringtown Iron Works is a small fictional shipyard on the East Coast dedicated to shipping overhaul. It focuses on obtaining government contracts for overhauling naval ships. These overhauls require Stringtown to maintain a quality workforce that is capable of rapid production. The position of pipefitter is particularly critical for success.
Pipefitters are responsible for repairing and installing the piping systems onboard the vessels. Employees in the pipefitter classification may also be called on to work in the shop, building pipe pieces that are ultimately installed on the ships. Like most union jobs in the yard, pipefitters are predominantly white men between the ages of 30 and 45. As part of the most recent bargaining agreement, work is primarily done in cross-functional teams.
Job Description
Job: Pipefitter
Pay: $12.00 to $20.00 per hour
A pipefitter must:
Read and interpret blueprints and/or sketches to fabricate and install pipes per specifications.
Perform joint preparation and fit-up to fabricate and install brazed and welded piping systems.
Perform layout and calculations to fabricate and install the pipe.
Fabricate pipe pieces up to 10” in diameter and up to 10′ long to support shipboard pipe installation.
Install ship’s piping, such as water, drains, hydraulics, lube oil, fuel oil, high-temperature air, etc. on location and within tolerances per design.
Inspect and hydro test completed piping systems to ensure compliance with the ship’s specifications.
Use a variety of hand and power tools to perform joint preparation, assembly bolt-up, and positioning during fabrication and installation.
Utilize welding equipment to tack-weld pipe joints and to secure pipe supports to ship’s structure.
Completion of the above tasks requires pipefitters to do the following:
Frequent lifting and carrying of 25–50 pounds
Occasional lifting and carrying of over 50 pounds
Occasional to frequent crawling, kneeling, and stair climbing
Frequent pushing, pulling, hammering, and reaching
Frequent bending, stooping, squatting, and crouching
Occasional twisting in awkward positions
Occasional fume exposure
Questions:
Which of the overall HR strategies would be best for Stringtown Iron Works?
Should Stringtown focus on job fit or organization fit?
Should Stringtown hire based on achievement or potential?
What selection methods would you recommend for Stringtown? Why?
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3. County General Hospital is a 200-bed facility located approximately 150 miles outside Chicago. It is a regional hospital that draws patients from surrounding farm communities. Like most hospitals, County General faces the difficult task of providing high-quality care at a reasonable cost.
One of the most difficult obstacles encountered by the hospital is finding and retaining qualified nurses. The annual turnover rate among nurses is nearly 100 percent. A few of the nurses are long-term employees who are either committed to County General or attached to the community. Employment patterns suggest that many of the nurses who are hired stay for only about six months. In fact, County General often appears to be a quick stop between graduation from college and a better job.
Many who leave acknowledge that they were contacted by another hospital that offered them more money. Exit interviews with nurses who are leaving similarly suggest that low pay is a concern. Another concern is the lack of social atmosphere for young nurses. Nurses just finishing college, who are usually not married, complain that the community does not provide them enough opportunity to meet and socialize with others their age.
Hospital administrators are afraid that paying higher wages will cause a financial disaster. Big insurance companies and Medicaid make it difficult for them to increase the amount they charge patients. However, the lack of stability in the nursing staff has caused some noticeable problems. Nurses sometimes appear to be ignorant of important hospital procedures. Doctors also complain that they spend a great deal of time training nurses to perform procedures, only to see those nurses take their new skills someplace else.
Questions:
Turnover is high at almost every facility where nurses are employed. What aspects of nursing make turnover for nurses higher than for many other jobs?
What programs do you suggest County General might implement to decrease nurse turnover? Be specific.
How might County General work with other hospitals to reduce nurse turnover?
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4. Reliable Underwriters is a risk management firm that provides insurance services to large organizations. Part of its operation is a claims-processing center that employs 156 clerical workers. These workers interact with clients to answer questions and provide information about the status of claims. Reliable has a corporate objective of obtaining the highest possible customer satisfaction ratings. However, recent customer satisfaction surveys suggest that some of the clerical workers are not adequately meeting clients’ needs.
As part of an initiative to increase customer satisfaction, the management team of the claims processing center has decided to change the performance appraisal process. In the past, ratings have been made on a 5-point scale. A score of 5 represented outstanding performance, a score of 1 represented unacceptable performance, and a score of 3 represented average performance. Last year, 135 employees received a score of 4. Only 3 received a score of 5, and only 2 received the lowest rating. Since almost everyone receives the same rating, employees in the claims-processing center have little concern about being evaluated. For the most part, they see performance appraisal simply as a nuisance. However, the newly proposed process will create major changes.
The main change will be the use of forced distribution. Each supervisor must rate at least 20 percent of employees as outstanding and at least 10 percent as unacceptable. This forced distribution is expected to clearly identify top performers. Low performers will also be identified and encouraged to either improve or seek employment elsewhere.
Questions:
Do you predict that the forced distribution will increase customer satisfaction? Why or why not?
Which clerical workers do you think will most strongly oppose the change?
How do you think supervisors will react to the proposed change?
What problems with contamination and deficiency could occur with the forced distribution ratings?
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5. Sales at a large telecommunications company were down for the third quarter. Management reviewed several strategies to improve sales and concluded that one solution would be to improve training for the large, dispersed sales force.
For the sake of expediency, the training department began using a needs assessment it conducted several years before as a basis to develop enhanced training. The plan was first to update the original needs analysis, and then to develop new training strategies on the basis of what it found. The department also began investigating new training technologies as a possible means to reduce training delivery costs. However, management was so intent on doing something quickly that the training department was ultimately pressured into purchasing a generic, off-the-shelf package by a local vendor.
One of the features of the package that appealed to management was that the course could be delivered over the Web, saving them time and expense of having the sales force travel to the main office to receive training. Hence, even though the package was costly to purchase, the company believed that it was a bargain compared to the expense of developing a new package in-house and delivering it in person to the sales force.
Six months after the training had been delivered, sales were still declining. Management turned to the training department for answers. Because no measures of training performance had been collected, the training department had little information upon which to base its diagnosis. For lack of a better idea, members of the training department began questioning the sales force to see if they could determine why the training was not working.
Among other things, the salespeople reported that the training was slow and boring and that it did not teach them any new sales techniques. They also complained that, without an instructor, it was impossible to get clarification on things they did not understand. Moreover, they reported that they believed sales were off not because they needed training in basic sales techniques, but because so many new products were being introduced that they could not keep up. In fact, several of the salespeople requested meetings with design engineers just so they could get updated product information.
Questions:
Outline the key decisions made from the beginning to the end of this case. Who made each of those decisions, and why?
Describe the ideal process for handling the concern about declining sales, ignoring for now the pressure from management.
What arguments could be made to convince management that working with an outdated needs assessment is not wise?
If you were asked to develop a training program for these sales agents, what content, method, and media would you choose? Explain your answers as best you can, given the limited information provided.
Source: Excerpted from Eduardo Salas and Janice A. Cannon-Bowers, “Design Training Systematically,” in Edwin A. Locke (ed.), Handbook of Principles of Organizational Behavior (Oxford, UK: Blackwell, 2000).
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6. Malik’s first day as a new manager ended up more challenging than he expected. While having to adjust to a new workplace and new colleagues, he had an interesting management challenge thrown at him. Toward the end of the day, one of his employees came to him, looking frustrated and exhausted. Malik had heard that this employee was going to be one of his best, a high-potential employee who would be a great asset. On this day, the employee did not look to be an asset to anyone.
Without providing much history or detail, this employee explained to Malik that she is planning to quit her job. She is exhausted and frustrated, she explains because the work seems to be at once too much and too little. She feels overworked, but at the same time, she does not feel any excitement about her work. She doesn’t feel she is being challenged to learn skills that will help her to reach the ultimate goal of owning her own business.
Unfortunately, Malik has to leave for the day before you can get more information. What should he do? Answer these questions, and formulate a plan of action.
Questions:
What might be the factors that are causing this employee’s dissatisfaction?
Which of these factors could be addressed with improvements in the way the organization handles development as described in this chapter?
What should Malik do tomorrow with regard to this employee?
What long-term changes should Malik suggest for this organization, if it appears that this employee is not the only one with these complaints?