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Section 2 - Group 4 A Zero Wage Increase Again Case Study

Mark Coglin, owner of House, Hearth and Home store, has not increased employee wages in two years. Some employees like Simon, Aaron and Wesley work harder than others and feel they deserve higher pay. Aaron suggested allocating 2.5-3% of the budget for targeted raises. As a consultant, the assistant would advise Mark to give a 2% raise to all employees but allocate the remaining 1% to the top performers, Simon, Aaron and Wesley. Communicating the rationale for the raises and rewarding both contributions and continued hard work could motivate employees and prevent resentment.

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GUNJAN AGARWAL
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269 views

Section 2 - Group 4 A Zero Wage Increase Again Case Study

Mark Coglin, owner of House, Hearth and Home store, has not increased employee wages in two years. Some employees like Simon, Aaron and Wesley work harder than others and feel they deserve higher pay. Aaron suggested allocating 2.5-3% of the budget for targeted raises. As a consultant, the assistant would advise Mark to give a 2% raise to all employees but allocate the remaining 1% to the top performers, Simon, Aaron and Wesley. Communicating the rationale for the raises and rewarding both contributions and continued hard work could motivate employees and prevent resentment.

Uploaded by

GUNJAN AGARWAL
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Section 2 – Group 4

A Zero Wage Increase Again


Case Study
Case Introduction

House , Hearth and Home store owner Mark


Coglin has not increased the wages of
employees since last two years
Some employees like Simon, Aaron and Wesley
work more hard than others
So they should be awarded more than others
If some employees leave the company then
company can save 15%
Aaron suggested possibility of arranging 2.5 - 3%
of extra money
1. What outcomes does Mark seem to want achieve by
addressing wages/rewards?
1. There shouldn't be any wage freeze for 3rd year in a
row. this will lead to many problems.
2. Every employee gets a raise.
3. To show appreciation to Kyle, Simon and Aaron.
4. To motivate few employees.
5. To sustain the enthusiasm of employees .
2.  Contrast the outcomes that might be expected in the
following two scenarios:

(a) Mark uses the process improvement savings to give a


three percent wage increase to all employees
•Increase motivation of employees
•Committed towards work
•Sense of being rewarded
•Good impression about the company
•Value enhancement
b) Mark uses the money currently available in the budget to
give raises to Aaron, Simon and Wesley only.

•Partiality
•Feeling of being undervalued
•Increase in attrition
•Misunderstandings
•Slack off
3. As a consultant to Mark, would you advise him to give a
raise to all, to none, or to the deserving minority? Explain your
reasoning and how you would mitigate against possible
repercussions.
• Hybrid system
• 2% wage increase to all, remaining 1% split between Aaron,
Simon and Wesley
•Equal importance given to everyone and most deserving
rewarded extra
•Communicate how the wage raise was decided
•Explain the current financial scenario 
•Enhance competency
•Motivation to work hard
4. Design a reward system that will improve the behavior of
employees like Anne, Marie and Dougie.

Reward system to improve employee behavior:


 Every Employee will be rated by their superior on a scale
of 1-5 and the employee must be secure 3+ rating in each
section and a over all 4+ rating to be eligible for reward.
 
o Unplanned leaves (Digitally monitored)
o Reporting time and logging out time (Digitally
monitored)
o Customer satisfaction (Review given by the customer)
o Performance (Reviewed by the superior)
o Overall average (average of all the reviews)
 
 Employee with 4+ overall rating will be eligible to join the
company dinner that will be organized every month along with
their families.

 Only the employees who have maintained 4+ rating in 10 out


of 12 months will be considered for appraisal.

 Employee with top ten rating can purchase anything in the


item with zero profit margin up to $500.

 Employee with the maximum overall average for 3 months


will automatically eligible for appraisal.

 Employees with the lest overall average will be put into PIP
list and if a person get the lest average for three consecutive
month, the person will be terminated.
Thank You

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