Decision Making For Profitability Of The Organization

Management Problem

Discuss about the Decision Making for Profitability of the Organization.

As an organization starts expanding, the organizational problems may start intensifying thereby threatening the profitability of the organization. The same is the situation with the Australian organization, Bulla Dairy Foods. Established in the year of 1910, the organization has achieved enormous recognition owing to the production of a variety of dairy products, such as yogurt, ice cream, sour cream, cottage cheese, and imitation cream under various brands. The organization is an example of a family owned business, and it is remarkable to mention here that the company has been able to sustain itself in business over six generations. However, at present there has been a remarkable fall in the total sales and revenue earning capacity of the organization. Hence, the following business report intends to identify and examine the management problem of Bulla Dairy Foods (Bulla Dairy Foods 2016).  

 Any organization that is willing to sustain itself in future must ensure that it is capable of solving the management problems. Bulla Dairy Foods must ensure that the organization is capable of performing the basic management functions (Australia 2014); otherwise there will be a remarkable reduction in the production and efficiency of the organization. It has been observed that Bulla Dairy Foods has been encountering a serious management problem, which if remains uncontrolled, may lead to the downfall and gradual decline of the organization (Marinov 2013).

Human capital, apart from financial capital, plays an integral role in contributing to the organizational success of any company. However, in case of Bulla Dairy Foods, it has been observed that the management authority of the organization has been incapable of motivating the employees in an effective manner, as a result of which the organization is encountering a potential challenge in retaining the talented ad skillful workforce. Further, in addition to this, due to lack of employee motivational strategies, the employees are losing enthusiasm to work efficiently. Apart from this, Bulla Dairy Foods does not engage the employees through various programs, workshops and seminars, and as such the employees are unable to bridge the communication gap between the employer and themselves (Devito et al. 2016). Employee development and employee motivation is an area that is highly neglected by the authority of the organization. The major challenge that is impeding the further growth of the organization is that being a family-owned business, it has dysfunctional work culture, whereby the ownership of the organization has passed from one generation to the other, without any change in the mission or strategy of the organization. As a result, the owners and the management authority of the organization are unable to adopt the innovative motivational strategies matching the changing demands and the expectations of the employees.  The introduction of flexible working hours or lucrative incentive schemes, or the increment in salary and other promotional strategies, can assist the organization in engaging and retaining the employees, while at the same time aligning the organizational strategy with the personal interest of the employees (Lăzăroiu 2015).

Research Questions

The research questions that the report intends to examine are as follows:

• Does the organization offer lucrative salary package and incentive scheme to its employees?
• Does the management authority of Bulla Dairy Foods keep on periodically re-assessing and revising the salary structure of the employees?
• How often does the management authority of the organization engage the employees in explaining to them the duties and job roles assigned to them, by arranging seminars and workshops?
• What is the employee turnover ratio?
• How many employees are considering the need of leaving the organization and what is the reason behind the same?

The research is being conducted in order to analyze and evaluate the effectiveness of the motivational strategies present in Bulla Dairy Foods. Hence, the research adopts both the qualitative as well as the quantitative method of approach; while the qualitative method of research employs structured interview and literature review as the means of analyzing the present situation, the quantitative method of research employs the use of questionnaire survey to comprehend the expectations of the employees from the management authority of Bulla Dairy Foods (Silverman 2016). It should be remembered here that the interview is conducted as it helps in investigating the motivational strategies adopted by the employers, and to understand the effectiveness of the same, by considering the perspective of the employees over the matter. On the other hand, the questionnaire survey is useful in gaining a statistical data, as to how many employees is unwilling or even unenthusiastic working in the organization (Flick 2015).

The data is being collected by employing both qualitative as well as the quantitative research method. Literature review is an essential part of the research process, as it helps in analyzing ad evaluating the present situation in the light of the studies conducted by different researchers over the last decade (Panneerselvam 2014). While reviewing and assessing the scholarly papers and literary articles, Bulla Dairy Foods will be able to explore the relation between employee motivation and increasing rate of employee productivity in an organization. The scholarly papers reviewed, helps in comprehending how different recognized multinational as well as Australian organizations, such as Woolworths, Google or Microsoft motivate their employees and thereby increase employee productivity. However, the structured interview is also being arranged, whereby 5 HR managers and 7 employees of Bulla Dairy Foods, are being interviewed, to understand the employee as well as the employer perspectives over the motivational strategies adopted by the organization (Brinkmann 2014). The questionnaire survey is also being conducted, whereby 30 employees of the organization are being asked to answer questions that are directly related to their personal experience in serving the organization (Gast and Ledford 2014).

The literary journals reviewed clearly showed that there is a direct relation between motivating the employees, and increasing the efficiency level of the employees. From the interview, it is understood that the Bulla Dairy Foods offers a very few lucrative scheme, that hardly fails to attract the attention of the employees. There is hardly any salary hike, and further the employees, who are the family members of the owner, working in the organization, are always being prioritized while granting promotion. Out of the 7 employees interviewed, 5 employees were being recorded stating that the unequal treatment at workplace largely de-motivates them. Besides, 7 of these employees complained that though the salary package offered at the beginning is quite high, the organization does not offer increment benefits or any kind of loyalty bonus to the senior employees. The Human Resource Managers in the interview session stated that the organization provides high salary package at the start, which is much higher than any organization in the industry, and hence the organization does not consider the need of revising the salary structure at periodical intervals (Dasseh and Yousef  2016). Again, in the questionnaire survey conducted, it was being observed that 27 of the employees expressed their reluctance in joining their service the organization, owing to the absence of basic motivational factors in the organization, such as recognition and appraisal, sound pension plan, health insurance, disability insurance, or any kind of career development opportunities (Kirmani 2015).

Research Program

The importance of employee motivation cannot be overemphasized. As it has been observed from the interview as well as the survey response, the employees of the organization are unable to focus on their goals for two primary reasons-

• There is a striking absence of any motivational program that can encourage the employees to accomplish their goals in a given period.
• The organization does not organize regular meetings and interactive sessions with the employees, and hence the employees are being rendered absolutely directionless regarding the mission and the immediate goals of the organization.

It should be noted here that Bulla Dairy Foods has a huge number of competitors in the Australian as well as international market, such as Lion Dairy, and hence the organization must ensure that its employees are motivated enough to help the organization effectively implement its strategies (Porter et al. 2016). It has been observed that the organization does not reward any employee for their outstanding contribution, and hence it is advised that the organization must introduce an appraisal program whereby an employee will be financially rewarded as well as recognized for his extraordinary contribution or innovative idea in the organization. Further, the organization must try to create a valued relation with its consumers, by valuing their contribution towards the success of the organization. Bulla Dairy Foods should introduce training programs that will help the employees enhance and nurture their professional as well as communication skills (Mikkelsen et al. 2014). This will not only help in increasing the sincerity, efficiency and productivity of the employees, but will also increase the loyalty of the employees towards the organization. Besides, it has been observed that the management authority of Bulla Dairy Foods, does not organize the workshops and seminars that helps in regular interaction and exchange of information and thoughts between the employer and the employees. It should be remembered that these workshops can help an organization in aligning their strategies and missions, with the professional goals of the employees. The management authority of Bulla Dairy Foods must organize regular staff meetings, at least once in each week, so that the managers can successfully and efficiently communicate the strategies and the goals of the organization. Further, the organization must ensure that with the introduction of each new strategy, goal or change, it announces rewards so as to allure the employees into accomplishing the tasks. It has been observed that the organization offers high salary at the beginning and does not revise the salary structure and hence it fails to motivate the employees. It is advised here that the organization should hire the employees in lieu of a moderate salary package, and it keeps on revising the salary scheme at regular intervals, so as to keep on encouraging the employees to work harder. Further, it is important for Bulla Dairy Foods to offer long term benefits to the employees, such as the sound pension schemes, or health benefits and disability schemes so that the organization can enjoy long-term commitment from the employees (Klarner et al. 2013). Another major flaw in the management system of the organization is that the higher designations are being offered to the family members of the owners, and not to the deserving employees of the organization. This process of offering promotion must be stopped as it discourages the employees in pursuing their goals necessary for bringing organizational success (Nam 2012).         

Data Collection

Conclusion:

It should be remembered that employee motivation is one of the major factors that determines the success of the organization. It is important for Bulla Dairy Foods to attract and retain its workforce talent and skills, if it wants to sustain itself in a highly competitive market. However, Bulla Dairy Foods has not been able to adopt the effective motivational strategies that can potentially attract and retain the employees, and consequently the employees are gradually losing enthusiasm to work efficiently for the organization. Hence, it is important to keep on recognizing and rewarding the employees for their good work through the introduction of bonus pools, reward recognition and appraisal programs.

Reference List:

Australia, D., 2014. Australian Dairy Industry. Dairy Australia. Available online: www. dairyaustralia. com. au/Industry-information-About-the-industry. aspx.

Brinkmann, S., 2014. Interview (pp. 1008-1010). Springer New York.

Bulla Dairy Foods., 2016. Bulla, made with care and shared with love | Bulla Dairy Foods. [online] Bulla.com.au. Available at: https://www.bulla.com.au/ [Accessed 20 Sep. 2016].

Dasseh, M. and Yousef, M., 2016. The Role of Organizational Design in Enhancing Employee Motivation in Saudi Arabia.

Devito, L., Brown, A., Bannister, B., Cianci, M. and Mujtaba, B., 2016. Employee Motivation based on the Hierarchy of Needs, Expectancy and the Two-Factor Theories Applied with Higher Education Employees. International Journal of Advances in Management, Economics and Entrepreneurship, 3(1), p.20.

Flick, U., 2015. Introducing research methodology: A beginner’s guide to doing a research project. Sage.

Gast, D.L. and Ledford, J.R., 2014. Single case research methodology: Applications in special education and behavioral sciences. Routledge.

Kirmani, S.S., 2015. The role of employee motivation in the relationship between personality traits and employee job performance (Doctoral dissertation, Universiti Teknologi Malaysia, Faculty of Management).

Klarner, P., Treffers, T. and Picot, A., 2013. How companies motivate entrepreneurial employees: the case of organizational spin-alongs. Journal of Business Economics, 83(4), pp.319-355.

Lăzăroiu, G., 2015. Employee Motivation and Job Performance. Linguistic and Philosophical Investigations, (14), pp.97-102.

Marinov, A., 2013. Problems in the organization of the system for financial management and control in the State Reserve and War-Time Stocks State Agency. Macedonian Journal of Animal Science, 3(1), pp.97-108.

Mikkelsen, M.F., Jacobsen, C.B. and Andersen, L.B., 2014. Managing employee motivation: Exploring the connections between managers’ enforcement of command systems, employee perceptions, and employee intrinsic motivation. International Public Management Journal.

Nam, V.T.P., 2012. Needs satisfaction as a way used to motivate

Panneerselvam, R., 2014. Research methodology. PHI Learning Pvt. Ltd..

Porter, T.H., Riesenmy, K.D. and Fields, D., 2016. Work environment and employee motivation to lead: Moderating effects of personal characteristics.American Journal of Business, 31(2), pp.66-84.

Silverman, D. ed., 2016. Qualitative research. Sage.