Juicy Red Tomato Companys Challenges - Essay Example

Juicy Red Tomato Company I. Observation Juicy Red Tomato Company (JRT) is small enterprise situated in Florida and has been operational for 15 years already. As a consistently growing company, JRT has amassed profits that stood at a growth rate of 5 percent each year. Despite the steady growth rate, the company had experienced an increased rate of costs that have grown to 2.5 to 3 percent in the last 3 years. Three reasons were identified by the JRT management as the reasons for the increased costs. These were unexpected temperature drops, pests, and increased labor costs. What is admirable about the company is that the top management came from the ranks of the JRT and this could be identified as one of its strengths because these people are familiar with the “ins and outs” of the company. Unfortunately, the company is on the rocks because key personnel started leaving last year because they realized that they have “no future with JRT”. This backlash could be detrimental to the company because it had previous plans of expanding in the future. With this, this paper would thresh out the problems associated with the human resources (HR) planning of JRT and seek out the viable solutions to these problems. II. Preliminary Data Gathering The previous HR consultant conducted preliminary interviews within the organization, undergone research of the produce industry and consulted other business cases with similar challenges. It has been found out that “Juicy Red Tomato Company needs to invest in retention not only of its managerial personnel, but also front-line production employees. In addition, JRT needs to improve communication between production and operations, possibly by enhancing technology used by the company as a whole”. III. Problem Definition 1. What are the HR strategies that would enhance the effectiveness and efficiency of JRT’s organizational structure? 2. How would JRT select and maintain its managerial personnel and employees? IV. Theoretical Framework With regards to organizational structure, it has been observed that the JRT has the traditional structure. According to Grinnell and Apple (1975), there are five general indications that the traditional structure may not be adequate for managing projects: Management is satisfied with its skills, but projects are not meeting time, cost, and other project requirements. There is a high commitment to getting project work done, but great fluctuations in how well performance specifications are met. Highly talented specialists involved in the project feel exploited and misused. Particular technical groups or individuals constantly blame each other for failure to meet specifications or delivery dates. Projects are on time and to specifications, but groups and individuals arent satisfied with the achievement (pp. 84-87). Our observations agree with what Green and Apple (1975) identified as the problems that arise with the traditional organizational structure. In fact, many companies do not realize the necessity for organizational structure to change until it is too late. Management looks externally (i.e., to the environment) rather than internally for solutions to problems. A typical example would be that new product costs are rising while the product life cycle may be decreasing. Should emphasis be placed on lowering costs or developing new products? If JRT assumes that an organizational system is composed of both human and nonhuman resources, then the management must analyze the sociotechnical subsystem whenever organizational changes are being considered. The social system is represented by the organizations personnel and their group behavior. The technical system includes the technology, materials, and machines necessary to perform the required tasks. Experts have revealed that there is no best structure to meet the challenges of tomorrows organizations. The structure used, however, must be one that optimizes company performance by achieving a balance between the social and the technical requirements. According to Sadler (1971), Since the relative influence of these (sociotechnical) factors change from situation to situation, there can be no such thing as an ideal structure making for effectiveness in organizations of all kinds, or even appropriate to a single type of organization at different stages in its development. There are often real and important conflicts between the type of organizational structure called for if the tasks are to be achieved with minimum cost, and the structure that will be required if human beings are to have their needs satisfied. Considerable management judgment is called for when decisions are made as to the allocation of work activities to individuals and groups. High standardization of performance, high manpower utilization and other economic advantages associated with a high level of specialization and routinization of work have to be balanced against the possible effects of extreme specialization in lowering employee attitudes and motivation. As organizations are defined as groups of people who must coordinate their activities in order to meet organizational objectives, there needs to be a coordination function in JRT that requires strong communications and a clear understanding of the relationships and interdependencies among people. Organizational structures are dictated by such factors as technology and its rate of change, complexity, resource availability, products and/or services, competition, and decision-making requirements. This is why JRT should adapt “participatory management”. This strategy resulted in a focus on “productive” work cultures and the proliferation of self-directed work teams as means of managing work and achieving organizational success. Management writers such as Peters and Waterman (1982) and Deal and Kennedy (1982) encouraged firms to form strong cultures and communities in their organizations. Establishing mission statements and a highly participatory management system was thought to be the new, best way to control their subordinates. This type of participatory management is designed to let the workers communicate openly in order to create and sustain their own nurturing and rewarding work environment. Participation in the decision-making process allows workers to form connections, identifications, and a sense of ownership in their work environment. In keeping with normative principles, participatory management increases communication between workers and managers and reduces the organizational hierarchy. In this system, members of the organization are empowered. The belief is that increased involvement and self-control leads to greater worker satisfaction, and satisfied workers, according to the normative model, are seen as more productive and committed workers. In the end, the idea was to create a work community that would both enrich the membership and serve managerial goals. To encourage participatory management, the JRT management should also strengthen their feedback system. In organizations, employees seek motivations that would empower them to hold on to a particular job. This is why Byars and Rue (2004) identified job satisfaction as “an employee’s general attitude toward the job”. The organizational reward system often has a significant impact on the level of employee job satisfaction. In addition to their direct impact, the manner in which the extrinsic rewards are dispersed can affect the intrinsic rewards and satisfaction of the recipients. For example, if everyone receives an across-the-board pay increase of 5 percent, it is hard to derive any feeling of accomplishment from the reward. However, if pay raises are related directly to performance, an employee who receives a healthy pay increase will more than likely also experience feelings of accomplishment and satisfaction. On the other hand, feedback is the information people receive about their performance. It conveys an evaluation about the quality of their performance behaviors. Giving feedback could be done by providing information to employees regarding their performance on job expectations. This makes feedback is an important part of the education process. For instance, in the school environment, test grades let students know what they have achieved and what they must learn to do better next time. People at work give feedback to reinforce others’ good behavior and correct their poor behavior. The recipient of feedback judges its value and determines whether to accept and act on the feedback, reject it, or ignore it. Feedback has different purposes at different career stages. It helps newcomers learn the ropes, mid-career employees to improve performance and consider opportunities for development, and late career employees to maintain their productivity. Managers are an important source of feedback because they establish performance objectives and provide rewards for attaining those objectives. Other sources of feedback are co-workers, subordinates, and customers (London, 2003, p. 11). The impact of feedback on job satisfaction could be derived in the fact that it is linked to the psychological reception of an employee. JRT can use a non-traditional feedback system where the management would be informed about the job satisfaction of their employees and encourage them to stay with the company by undertaking the improvements that they suggested. The traditional top-down feedback programs have now been replaced by two newer approaches, the upward feedback and so-called 360-degree feedback (Kreitner and Kinicki, 2004). Aside from breaking away from a strict superior-to-subordinate feedback loop, the newer approaches are different because they typically involve multiple sources of feedback. Kreitner and Kinicki (2004) deemed that instead of getting feedback from one boss during an annual performance appraisal, more and more managers are getting structured feedback from superiors, subordinates, peers, and even outsiders such as customers. According to Kreitner and Kinicki (2004), non-traditional feedback is growing in popularity for at least six reasons: 1. Traditional performance appraisal systems have created widespread dissatisfaction. 2. Team-based organization structures are replacing traditional hierarchies. This trend requires managers to have good interpersonal skills that are best evaluated by team members. 3. Multiple-rater systems are said to make feedback more valid than single-source feedback. 4. Advanced computer network technology (the Internet and company intranets) greatly facilitates multiple-rater systems. 5. Bottom-up feedback meshes nicely with the trend toward participative management and employee empowerment. 6. Co-workers and subordinates are said to know more about a manager’s strengths and limitations than the boss. V. Generation of Hypothesis 1. JRT could adapt the participatory type of organizational structure to improve the effectives and efficiency of its organizational structure. 2. Given the participatory management, JRT should enhance its feedback system from management to employees because this can uplift job satisfaction. References Byars, L.L., & Rue, L.W. (2004). Chapter 13: The Organizational Reward System, Human Resource Management, 7th ed. New York: The McGraw-Hill Companies. Deal, T. E., & Kennedy, A. A. (1982). Corporate Cultures: The Rites and Rituals of Corporate Life. Reading, MA: Addison-Wesley. Grinnell, S.K., & Apple, H.P. (1975, January). When Two Bosses Are Better Than One. Machine Design, pp. 84–87. Kreitner, R., & Kinicki, A. (2004). Chapter 10: Improving Job Performance with Feedback, Extrinsic Rewards, and Positive Reinforcement, Organizational Behavior, 6th ed. New York: The McGraw-Hill Companies London, M. (1997). Job Feedback: Giving, Seeking, and Using Feedback for Performance Improvement. Mahwah, NJ: Lawrence Erlbaum Associates. Peters, T. J., & Waterman, R. (1982). In Search of Excellence: Lessons from Americas Best-Run Companies. New York. Harper & Row. Sadler, P. (1971). Designing an Organizational Structure, Management International Review, 11(6):19–33. Read More