The Challenges of Microsofts Reward System, Microsofts Group Performance - Assignment Example

?Q1) There are many advantages and disadvantages to group work, using relevant theories, explain the factors that contributed to the success of Microsoft’s group performance and avoided any negative group influence, before 2006. (800 words) As has often been noted throughout management theory and an array of different studies on the subject, the key benefits that groups can provide are vast. Firstly, the group is a key way in which the synergy of the project or the given goals can be realized. Naturally, the way in which the energies of the group can be focused are key in determining the true relevance and success ratio that will be achieved; however, the fact remains that group engagement with a given task invariably yields a higher degree of success than any known alternative method of goal completion. With respect to the given case in point, that of Microsoft before and after the fateful year of 2006, there are a number of points that this analysis will seek to make as a means of better informing the reader as to why such a shift in outcomes were noticed within this specific year (Dodds 2011, p. 33). Whereas group work and the performance review process had previously helped to elevate the level of overall output, profitability, and performance, the firm seemed to reach a type of critical mass in which the given formula of success that had set the firm on such a path of growth and rapid development seemed to fall apart. However, it is obvious from a study of business management theory that it is not possible for a given approach to merely stop working (Hult 2012, p. 5). Instead, one must assume that key personnel factors, dynamics of business, culture, or other factors have affected the ability of the previous system to continue to promote the high level and degree of success that the firm had formerly experienced. With respect to the particular management and/or organisational theory that Microsoft ascribed to, one can necessarily determine it to be a type of systems management where the core component of the system was not necessarily the traditional breakdown of department and function but rather divisible upon the working group. This division by working group was what led to such a degree of strength and specialized function within the entity; however, it was also one of the factors that doomed Microsoft to experience many of the issues that it had on and after 2006. As a result of the high level of emphasis on groups and the way that the performance reviews ranked these groups and their individual members, a type of opportunism developed. This opportunism is a trait that can be linked to both management theory as well as human psychology; however, for the purposes of this brief analysis, the author will focus upon the level and extent to which the emphasis on group formation, recognition, and personal performance sought to develop a type of self-interested dynamic that quickly gave way to something of an extent culture within the Microsoft organization (Maddox 2005, p. 3). The fact of the matter was that the group dynamics that had given rise to such a high level of success within the organization were the very same dynamics that eventually would prove to be a net negative. It is a well known fact that a company’s culture is not something that is developed and implemented overnight (Muller et al 1999, p. 90). Rather, it takes many years, and the actions of management to solidify. In this way, the reader can quickly infer the that the true nature of the issues associated with Microsoft, as indicated by the case study which was reviewed in writing this brief response, stem not from the fact that the individual management or organizational style which was employed was fundamentally wrong; rather, the key errors only developed many years later as a function of the negative cultural developments associated with opportunism, selfishness, and the gradual shift from operating as a true group should and seeking only to maximize a sense of personal gain from each and every situation that the members of the respective group encountered (Greene 2000, p. 161). In this way, the reader can understand that the ultimate leadership and management failure was not in choosing the wrong model to engage the employees with or to direct the workflow; rather, the ultimate failure was allowing a culture of opportunism and selfishness be born out of what was intended to act as a means to encouragement and personal and professional development of organizational talent (Greene 2005, p. 40). As such, the case serves as a prime example of the ways in which formerly working models and theories of management can quickly become misaligned with the ultimate goals that an organization seeks to promote. In this way, the need to continually monitor the way in which company culture develops is a prime need and necessity in order for an organization to both stay relevant and ensure that their own goals are being successfully adhered to and followed in terms of the different means by which a culture that is reflective of these goals develops within the organization/firm in question. Q2) Analyse the challenges of Microsoft’s current reward system using the most relevant theories of motivation. Explain the possible consequences of this system for Microsoft (800 words) With respect to the key challenges that Microsoft’s current reward system faces, these can obviously be understood as a function of the fact that the core goals that the organization attempts to transmit to the group have thus far been misinterpreted and warped to deliver an alternative result and the development of a non-preferred culture within the firm. The inescapable fact remains that due to the fact that Microsoft has such a well-established reward system, each and every layer of the firm both knows and understands the importance of maximizing their own utility within the given system. As the firm has matured, so too has the level of individual and group understanding regarding how to game the system in order to maximize personal and professional utility. Although such is to be expected, it has not helped to foster a greater level of performance, an increase in work output, an overall increase in synergy, or the development of a more dynamic and/or competitive company (Keiser 2012, p. 25). Rather, the current system has effectively destroyed the level of competitive drive that Microsoft could bring to bear within the current market. Furthermore, as illustrated by the given case study, the level to which the firm was able to meet its timetables, goals, and product development benchmarks was effectively hampered as well. As has been demonstrated within the given case in point, the motivation system that Microsoft enacted can best be described from the perspective of the incentive theory of motivation; also known as the reward motivation theory. In short, the type of motivation that Microsoft engaged their shareholders with placed a degree of personal motivation at the ultimate expense of development of group operation and effectiveness. Although this was not the desired intent, the powerful psychological aspects of personal incentive motivation meant that shareholders were actively keeping helpful information from their colleagues and group mates in an attempt to leverage a degree of personal gain from their performance reviews; knowing that freely shared information could serve to weaken their overall chances of accruing a positive performance review and the associated benefits that this entailed. As a means to counter the effects of this clearly ineffective form of incentive management, it is the suggestion of this author that the management and leadership of Microsoft seek to re-orient the culture of the firm back towards promoting the success of the group as the ultimate goal (Schomer 2010, p. 50). Whereas there are always a degree of tradeoffs within any business or management decision, it may be necessary for leadership to slow or even temporarily halt the process of promotion based upon the given scheme that has been detailed within this brief analysis. As a function of redefining what equates to success within the firm, many of the negative associations and poor practices that the case study has detailed would necessarily be drawn to a close (Holen et al 2010, p. 78). If Microsoft continues to employ such a system within its organization, it is likely that the company culture will become even more concentric upon the selfish interests of individual group members; thereby negating any original effectiveness that the group formation had to begin with (Cusomano et al 1996, p. 26). Although work will still be done, the level of efficiency will continue to drop as the company culture becomes more and more pervasively determinant upon the incentive theory of motivation and less and less focussed upon the means whereby new quality outputs can be created (Silwa et al 2010, p. 10). Moreover, the prior levels of product development and innovation that were exhibited within the company as part of the prior culture will likely become more and more rare as self interests continue to rob working groups of their motivation to innovate for the greater good (Maddox 2005, p. 10). The situation that has been described is of course one of a highly self interested theory of group management. The key challenge with regards to attempting to change the given dynamic is to seek to do so without eroding the core principles that originally helped Microsoft to develop into such a prominent and dynamically viable firm (Battelle 2006, p. 124). The level to which self-interest and opportunism is manifest must be worked to be reduced without seeking to disrupt the group balance which has thus far helped the firm to experience such a high level of growth and profitability. Even though the current model leaves much to be desired, the threat of rapidly forcing changes to it is equally as dangerous as choosing to leave the failing model alone entirely. References Battelle, J 2006, 'LIGHTING UP MICROSOFT', Business 2.0, 7, 4, pp. 123-125, Business Source Premier, EBSCOhost, viewed 21 January 2013. Cusumano, M, & Selby, R 1996, 'How Microsoft competes', Research Technology Management, 39, 1, p. 26, Business Source Premier, EBSCOhost, viewed 21 January 2013. Greene, J 2000, 'MICROSOFT'S BIG BET. (cover story)', Businessweek, 3705, pp. 152-183, Business Source Premier, EBSCOhost, viewed 21 January 2013. Dodds, S 2011, 'People, places and technology: A hybrid future', People Management, pp. 32-35, Business Source Premier, EBSCOhost, viewed 21 January 2013. Greene, J 2005, 'LESS COULD BE MORE AT MICROSOFT', Businessweek, 3953, p. 40, Business Source Premier, EBSCOhost, viewed 21 January 2013. Holen, E, & Webb, A 2010, 'My transition story', Mckinsey Quarterly, 3, pp. 78-85, Business Source Premier, EBSCOhost, viewed 21 January 2013. Hult, GG 2012, 'A focus on international competitiveness', Journal of the Academy of Marketing Science, March, Business Source Premier, EBSCOhost, viewed 21 January 2013. Keiser, BE 2012, 'Research Rivals', Online, 36, 1, pp. 22-27, Academic Search Complete, EBSCOhost, viewed 21 January 2013. Maddox, K 2005, 'Microsoft opens up the lines of communication', B To B, 90, 12, pp. 1-42, Business Source Premier, EBSCOhost, viewed 21 January 2013. Maddox, K 2005, 'Integrated departments promise efficiency', B To B, 90, 2, pp. 1-49, Business Source Premier, EBSCOhost, viewed 21 January 2013. Muller, M, & Czeerwinski, M 1999, 'ORGANIZING USABILITY WORK TO FIT THE FULL PRODUCT RANGE', Communications Of The ACM, 42, 5, pp. 87-90, Business Source Premier, EBSCOhost, viewed 21 January 2013. Schomer, S 2010, 'The Recovery Business', Fast Company, 147, pp. 51-58, Business Source Premier, EBSCOhost, viewed 21 January 2013. Sliwa, C, Stedman, C, & Hall, M 2001, 'Microsoft Targets Service Organization at Enterprise', Computerworld, 35, 18, p. 10, Business Source Premier, EBSCOhost, viewed 21 January 2013. Read More