Motivation at Monarch Supply Company: a Case Study
Case Analysis MGT 390 10/18/12 Kelly Dengler Matthew Lam Isaiah Wright Introduction:The major issue that is concerning Monarch Supply Company is that seems to be a rather large disconnect between the employees working in the field sales department and the inside sales department which is causing a number of problems for the company, and jeopardizing their sustainable competitive advantage of other firms - Motivation at Monarch Supply Company: a Case Study introduction. The field sales department is regarded by most as being the backbone of the company due to the vast engineering background all employees are required to have and the extensive interactions they have with the customers.
The field sales department are all paid strictly on a commission basis with the salary ranging anywhere from $50,000 to $95,000. The inside sales department is responsible for supporting the field sales department by doing tasks such as, ordering equipment, expediting orders and quoting prices. In addition the inside sales department are responsible for handling all direct phone calls from customers interested about the prices of certain pieces of equipment. The inside sales representatives are paid on a salary basis with annual raises being based on the scores each employee receives on company performance appraisals.
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If an inside sales representative is performing their job to a high degree, they may in turn be asked to become a field sales department if the opportunity arises. In the midst of certain mistakes occurring, which have the potential to ruin Monarch’s credibility with customers if it continues; interviews with company employees have been conducted in which employees talk about their jobs and “point the finger” as to whom they deem responsible for the screw ups that have been occurring in the company. Problem Identification: * Monarch’s level of service has declined, which continues to result in a loss of clients to their competition. Problem mainly lies within the two different job perceptions held by the Field Sales force and the Inside Sales force. * Field Sales employees really enjoy working in the sales department, having a lot of interactions with customers, and receiving positive feedback from those customers when a job is done correctly. The Field Sales employees are able to reach such a high level of enjoyment because they find pleasure in being able to successfully fix any problems that customers may have. In addition, they have been with the company for a long time and view working for Monarch as being their job of choice. The Field Sales force is comprised of employees who are highly motivated to work hard due to their salary being solely based on commission. * Inside Sales employees see their job as something to hold them over until a better opportunity comes along. When asked to talk about her job, Beth Sammuels responded with comments such as, “This job is O. K. ” and, “I just take the order and shut up. ” * Comparison of the Two Perceptions using the Job Characteristics Model: * Field Sales employees are high in task significance, feedback from job, and autonomy, but are lacking in skill variety.
Extremely high levels of the three job characteristics seem to cause the employees to have an overly high sense of experienced meaningfulness. * Task Identity – Field Sales representatives have an average sense of task identity because they are all aiming for the common goal of fixing customers’ problems, but in order to do so they must work closely and on a personal level with the customers. * Task Significance – They believe they have one of the most important jobs at Monarch Supply Company and that the entire business would fall apart without them. Autonomy – Field Sales employees are barely supervised and have the freedom to use their knowledge and educational background to solve problems for customers. * Feedback from Job – Customers tell the Field Sales employees how well they have solved their problems, which gives the employees instant feedback. * Skill Variety – These employees have a low level of skill variety because the majority of their skills revolve around diagnosing problems for customers by directly interacting with them. Inside Sales employees are high in skill variety, but lower in the other dimensions, which cause a lack of motivation. This causes them to have low experienced meaningfulness, experienced responsibility, and knowledge of results. * Task Identity – Inside Sales representatives have a low sense of task identity because the main role of their job is to provide support for the Field Sales representatives. * Task Significance – The Inside Sales employees have a very low sense of task significance because they are constantly being berated by either their boss of the Field Sales force. Autonomy – Even though workers in the Inside Sales force are not closely monitored, they still do not feel that they have a lot of freedom to make their own decisions when it comes to taking customers’ orders. Therefore, their level of autonomy is very low.
* Feedback from Job – These employees do not receive any sort of feedback from their job because they have no idea what happens after they talk to a customer. * Skill Variety – Inside Sales employees have a pretty high level of skill variety because they take care of billing, quote prices, order the equipment, expedite orders, and deal with customers over the phone. Neither the Inside Sales force or the Field Sales force is willing to take responsibility for the mistakes that have been occurring, which has delayed any hope for a resolution to their competition problem. * The Field Sales force blames the Inside Sales representatives because they are not as motivated or qualified to do the job. * Field Sales employees see themselves as the only employees that count, and that the Inside Sales representatives’ sole job is to assist and support them in whatever they need. Field Sales employees are overly confident/cocky in their abilities to perform tasks due to the fact that they more qualified and have been with the company longer. Whenever a mistake is made, they just assume it has to be from the Inside Sales side of the business. * Employees working in the Inside Sales department complain that Field Sales representatives are always bugging them about certain tasks, and that when something goes wrong in the Field Sales department, they immediately storm into the Inside Sales office yelling about losing company credibility. Inside sales employees are becoming less motivated to do work mainly due to the fact that whenever there is a dispute between the two sides, the Inside Sales manager always sides with the Field Sales. * Management in both departments also blame one another and are not doing anything productive to reach a resolution and set a good example for their employees. Diagnosis:The root cause of the various problems Monarch Supply Company has been facing is the large gap in motivation levels between the Field Sales representatives and the Inside Sales representatives.
While each side has in fact been blaming the other, it is actually a mutual combination of each side’s faults. Using Maslow’s Hierarchy of Needs, the Field Sales force can be identified as reaching Self-Actualization, whereas the Inside Sales force has only gotten as far as reaching Safety Needs. The disconnection between the two departments’ level of motivation seems to first become apparent at Maslow’s level of Love/Belonging. Inside Sales representatives are unable to obtain a sense of love and belonging in the workplace because they feel they are picked on, especially the female Inside Sales representatives.
Therefore, they are also unable to reach the Esteem level, and in turn, also the Self-Actualization level. The fact that Inside Sales employees have low levels of task identity, task significance, autonomy, and feedback from their job also contributes to their inability to obtain the higher levels of Maslow’s hierarchy of needs. This inability causes Inside Sales employees to be less motivated because they feel they cannot move higher up in the hierarchy. On the reverse side, the Field Sales representatives are able to obtain every level in the hierarchy.
The fact that Monarch Supply Company is the only company that most of the Field Sales employees want to work for and the “I love my job” attitude that they have proves that they feel a strong sense of love and belonging within the company. High levels of task significance and feedback from their job majorly inflate their egos, which is one of the reasons why they reach Maslow’s level of Esteem. Self-Actualization is reached by the Field Sales employees through feelings of achievement and advancement, however Self-Actualization is a need that individuals are continually grasping for.
They get a feeling of fulfillment by using the engineering degrees they have earned and also through having a high sense of autonomy in the workplace. Having a lot of autonomy in their jobs allows the Field Sales representatives to try and reach their full potential. By reaching the top of Maslow’s hierarchy of needs, the Field Sales employees are highly motivated to reach their full potential. The large disconnection between each department’s level of motivation has caused miscommunication problems that end up negatively affecting Monarch’s customers.
Price misquotes, late deliveries, and wrong equipment being delivered are just a few of the reported problems by Monarch’s management. It seems that the differences in motivation create an ongoing cycle that reinforces the positive or negative feelings felt by the respective groups, which will overtime increase the motivational gap. As it continues to increase, the level of service associated with Monarch will continue to decrease, allowing for more and more competition to wedge their way into the market.
Recommended Solutions:The solutions recommended to Monarch Supply Company have been derived from dimensions of Herzberg’s Two-Factor Theory. Since the diagnosis is that there is too much of a gap between the motivation levels of the Field Sales representatives and the Inside Sales representatives, it seems obvious that the objective of the solutions should be to create a more equal balance. Therefore, it is recommended that Monarch try to bring both departments closer to the neutral point on Herzberg’s Hygiene/Motivation scale, but still ensuring some job satisfaction. * Hygiene Factors Quality of Supervision – Require managers from each department to attend a coaching and feedback seminar. * Managers will learn better techniques for training and coaching the employees in their respective fields. * Both the quality and amount of supervision needs to be improved for the Inside Sales force in order to match the amount of autonomy in their jobs, which will result in less job dissatisfaction. * The quality of supervision is the only aspect that needs to be improved for the Field Sales force to lessen job dissatisfaction due to the high level of autonomy in their job. Relations with Others – Pair up each Field Sales representative with an Inside Sales representative. * Forces both sides to be in constant communication and interaction with each other. * Learning curve would be small for both sides since they share a similar educational level. * Creates less room for error when filling, processing, and delivering customer orders. * Promotes a sense of camaraderie and team competition. * Allows the company to be in a better position to regain an edge over competition by restoring its sustainable competitive advantage. Improving relations with others will bring both the Inside Sales and Field Sales employees closer to having no job dissatisfaction. * Rate of Pay – Change to a straight commission basis.
* Since the Field Sales and Inside Sales employees are going to be working as a team, their payroll structures should be constructed the same. * Closing the pay rate gap will help create less job dissatisfaction for the Inside Sales force, and therefore increase their motivation. Field Sales employees will remain at a higher commission bracket, but the Inside Sales employees will receive a portion of the profits they bring in as a bonus and an incentive to be more motivated at work. * The Inside Sales force will be more motivated to work hard if their salaries are tied to their performance. * Motivation Factors * Career Advancement – Provide more opportunities for promotions and transfers within the organization that are realistically obtainable. * The establishment of roles such as Assistant Manager provides more opportunities for employees to strive for advancement. The Inside Sales representatives need more room for career advancement than the Field Sales representatives because the Field Sales representatives are happy where they are in the company. * Increasing the number of opportunities for career advancement for the Inside Sales force will give them a higher sense of job satisfaction, resulting in a closer match to that of the Field Sales force. * Recognition – Develop and implement a policy for establishing a “Sales Team of the Month” reward system. * The reward system reinforces the need for cooperation among Field Sales members and Inside Sales members. Giving the Inside Sales force more recognition for their work will bring them closer to having a higher sense of satisfaction. * Responsibility – Now that the two departments have been integrated into Sales teams, they will have to share responsibilities and consequences. * Eliminates the “blame game” problem. * Brings the Inside Sales representatives closer to having high job satisfaction and brings the Field Sales representatives closer to having no job satisfaction. * Results in a more balanced level of job satisfaction between the two different departments.
Implementation Plans:To implement the proposed solution, an initial meeting will need to be held. Both Inside and Field Sales representatives will be present and Management will explain the following changes. Since there are 10 Field Sales representatives, each member of the Insides Sales team will be assigned to work with 2 members of the Field Sales team. Doing this will add specificity to both teams. Inside sales representatives will become familiar with their specific team and their clients. Working this close will make communication and processes more efficient.
Inside reps will gain useful experience from the more senior field reps and the field reps can learn something new from their younger counterparts since they are not as far removed from college. The case also states that the inside sales reps recommendations for are being ignored by clients. When the departments team up these recommendations will at least be heard giving the inside sales reps more socialized power. The field sales team loves the satisfaction they get from immediate positive feedback from clients and the high autonomy they get on the job we will bring that culture to the office.
Office management, Joe Belling, will give positive feedback weekly to the insides sales representatives according to their quality of work. In addition to positive feedback Joe Belling will have to be less strict on his inside sales team since. Since all of his employees performance scores are 20 and above they are obviously productive. By allowing them to communicate matters other than business it will make the work environment less stressful and more pleasant to work in without having to look over your shoulder. Every week each team of inside and outside reps will set goals for that week.
At the end of the week, all the sales reps will meet and discuss which goals were and were not met. At this meeting, there will also be a portion set aside for peer feedback on how to improve moving forward. Setting goals will clearly display each individual’s need for achievement, and peer feedback will enhance the need for socialized power and affiliation. Setting goals in plain view of peers will create a higher need of accountability for ones work. The last step to implement this plan is to put an additional bonus system in place for the inside sales representatives.
Last years overall sales totaled $672,000. At the end of the year the inside sales force will split one percent of these total sales equaling $1,344 per employee. This percentage is small enough that the field sales team will not be significantly affected, but it is large enough to the insides sales team to become more accountable and involved in the sales process. Summary:In brief, there is a large gap in the level of motivation between the Field Sales representatives and the Inside Sales representatives of Monarch Supply Company.
By implementing a few changes to influence hygiene and motivational factors, Monarch will be able to regain their competitive advantage. The first recommended change in the hygiene factors is increasing the quality of supervision by requiring the managers in both departments (Field Sales and Inside Sales) to attend a coaching and feedback improvement seminar. When the quality of management is increase, employees’ feedback from their job will also be increased.
The second recommended change is improving the employees’ relations with others by pairing up the Field Sales representatives with the Inside Sales representatives and making them work as teams. Employees in the Inside Sales division will consequently be able to achieve Maslow’s third level of Love and Belonging, and thus increase their motivation. The third recommended change in the hygiene factors is creating a pay rate structure that provides an incentive for both departments to perform well. In regards to motivation factors, the first change recommended is to provide more opportunities for promotions and transfers within the organization.
This change must be implemented because the Self-Actualization level in Maslow’s hierarchy requires individuals to continually reach for their full potential. Thus, more motivated employees will be the result of more career advancement options. The second recommended change is to enhance recognition by developing and implementing a “Sales Team of the Month” reward system. By doing so, not only is recognition increased, but both task significance and task identity are as well. Finally, the third recommended change in the motivation factors is increasing and clearly defining responsibilities.
Since the Field Sales force and the Inside Sales force are going to be paired up, they will be able to hold each other accountable for their actions. All in all, the changes that have been recommended for implementation will increase employee motivation by closing the gap between Inside Sales representatives and Field Sales representatives in regards to Herzberg’s Two-Factor Theory, Maslow’s Hierarchy of Needs, and the elements of the Job Characteristics Model. In doing so, Monarch Supply Company’s level of service will be restored, and along with it their competitive advantage.a