Situationoverview:Due tofinancial crisis the Morgan Moe’s store were in bad situation. It reduce demandfor high margin products. The chain had to reverse its strategy of expansion andcut down on jobs.
The insecurity of employees about their jobs was led todissatisfaction and negative attitudes during the job. Due to uncertainty ofjobs the company was likely to lose more employees which push the olderemployees toward bankruptcy. To fix this situation, Morgan Moe’s prepare fivevariants of a performance management system. This report outlines the result ofimplementing these systems and their relative effectiveness.Analysisand Findings: The keydependent and independent variables in this test has influenced outcomes. In everyexperiment, the company spread the information among the employees.· The independent variable in this test was sick leave andabsence which is tracked in Program I and IV.· The dependent variable in this test is sales andinventory which is tracked in Program III and IV.
Lower sales likely occur dueto higher absence and sick leave. However, there are other factors on which theoutcomes of the business is dependent such as demand for products andpurchasing power of customers.· The turnover of employees is partly dependentvariable. The implementation of themanagement system and the organization climate may result in people quitting.However, employees termination also include in turnover, which is anindependent variable.· Daily, weekly and monthly profit and cost of themonthly staff are dependent variables.
· There are other variables which could be measured suchas employees satisfaction, average age employees who were terminated and demographicsof employees by branch (to understand if the choice of management system wasdependent on it.)· More effective Program appears in IV and V. They havethe lowest employees turnover and highest profit. There is trade-off between thetwo program, program V has higher turnover, it also has better profitability.
This could be because employees wish to be consulted and made to feel a part ofthe organization. In term of turnover Program III is least effective. Thiscould be because of the sharing sales and inventory data which create greaterinsecurity and tension among employees about the company’s future and theirjobs.· While this data is a good indicator, we must bear inmind that the number of stores where each program was implemented is not equal.The sample size which implemented by program II is only 27, while 87 storesused by Program V. Secondly the employee turnover does not clearly indicate howmany employees were terminated and how many quit.
· For comparison of stores using each method does notinfluence the conclusion, since we are comparing profitability per store andaverage turnover as a percentage. However, each sample should be equally sizedfor fair comparison. ·