Upon reviewing the Vetements Ltee case, it became apparent that the company’s narrow focus on increasing sales solely by adding commission backfired and provided the opposite intended result. Several factors came into play to lead to the downfall in sales, employee resentment towards each other, and low employee morale. The Four Drive Theory, the Balanced Score Card concept, and the Equity Theory can all be used in combination to correct the errors made in this case which will lead to increased sales, improved employee relations, and increased employee morale (McGrath, 2013).
One factor was not adhering to the basics of the Four Drive Theory of Motivation. Using the theory as a guide, one can see that the company only emphasized two drives which are to acquire and to defend (McGrath, 138). The employees were only thinking about satisfying their drive to acquire more money through sales and to defend their territories in the store in order to obtain more customers. This would offset the balance between their other drives including the drive to bond. The theory advocates to balance all of your employees drives in order to maintain motivation which can lead to better productivity. The employees were not concerned about bonding with one another which would not promote a team atmosphere. They more concerned about defending their territories in order to aggressively pounce on customers. This made for a hostile working environment and caused the employees complaints about feeling resentment towards one another because they were put in the better location in the store (McGrath, 500). A method to change this would be to gather employee groups into teams and base incentives on how well the team is doing collectively. This will help to nurture not only the drives to acquire and defend, but also to increase the drive to bond with their team mates and even can benefit their drive to comprehend. By working as a team, the employees can interact with one another to find creative ways of increasing sales amongst their teammates and even inspire friendly competition between teams (McGrath, 2013).
When the company decided to add annual merit increases for managers they were adhering to the Balanced Score Card concept (McGrath, 148). By incorporating multiple measures of success such as store appearance and low customer complaints the goals were more evenly set across the board to reflect a more whole picture of how well the store is performing. However, when the company only put in place an incentive program for the sales staff which was solely based on the amount of sales obtained it lead to employees neglecting the other duties that can be just as important to getting the sale such as inventory. To correct this error, the company must match the areas of measurement that were put in place for management so that the employees will focus on more than just the sale. For example, if store appearance is measured by random visits by upper management looking for well stocked shelves then the employees would be motivated to make sure that the shelves were being stocked regularly. Adding a goal of lowering customer complaints to the scorecard would also help to minimize the aggressiveness of the sales staff as not to aggravate the customer (McGrath, 2013).
Management tried to correct some of the negative behaviors by assigning areas for an employee to be stationed. This then backfired because the employees felt that their commissions were negatively affected by where they were stationed for that shift. The Equity Theory comes in to play here (McGrath, 152). If the employees feel that they are given a particular disadvantage, in this case it would be where they were located in the store for their shift, compared to their fellow employees then they can perceive this as being unfair. Several negative behaviors can come from this perception, but in this particular case it made the employees resent one another and helped to lower employee morale. Again, the team solution would help to change this perception. A member of each team could be stationed together in different sections of the store in order to be fair, thus eliminating any inequities between teams.
Putting in play these changes would allow for the men’s retail chain to increase its’ productivity through effectively motivating its employees. Keeping in constant step with the guidelines set out by these concepts would enable the chain to ultimately increase sales, improve employee relations, and increase employee morale.
Mcshane. (2013). Organizational behavior (6th ed.). Singapore: McGraw-Hill Education.
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