Mba 530 Final Paper

Running head: PROBLEM SOLUTION: RIORDAN MANUFACTURING

Problem Solution: Riordan Manufacturing

University of Phoenix

MBA 530

January 9, 2008

Problem Solution: Riordan Manufacturing

What is motivation? “A motivating force or influence: drive or influence” according to Webster’s dictionary. Motivation is the prime factor in what most teachers, coaches, and employers are trying to get most out of their students, players, and employees. Riordan manufacturing is owned by Riordan Industries (Fortune 1000 enterprise with revenues in excess of $1billion) produces plastic parts and employs over 500 people. Their annually earning are estimated at $46 million with three plants located in Georgia, Michigan and China. Riordan’s primary consumer target are automotive, appliance and aircraft parts manufacturing, beverage makers and bottlers. Riordan Manufacturing is trying to figure out how motivate its employees right amid a current trend of uneven sales, employee turnover, and low employee morale.

Situation Overview

Riordan is currently in the process of changing how they market and manufacture their products. Riordan is changing the sales process from single person to team sales in effort to boost their struggling sales over the past two years. Riordan knows that the morale is low following a survey that was conducted and the main source of that low morale is the compensation and benefits. These are the areas Riordan Manufacturing are looking to improve, as they move forward.

Issue Identification

There is a lack of motivation among the employees because of concern about fair compensation and better benefits.

How to provide fair compensation among the three major groups of employees: Baby Boomers, Generation X and Y.

There needs to be better communications among upper management, everyone needs to be on same page

Declining sales and uneven sales over the past two years

Competitors recruiting Riordan’s best employees

Changing selling strategy from single person to a team approach

Employee turnover

Decline in work performance

Opportunity Identification

There are plenty to be concerned about for Riordan Manufacturing, but there is also a great deal of opportunities that may arise from these issues.

Improve sales with its new strategic approach

Improve on current reward system

To be known as one of the best companies to work for

Good company image allowing them to inturn recruit the best employees from other companies

Improve morale and work ethic which can translate into more productive work performance

Low turnover rate

Better productive/sales increases chances for profitable longevity in market

Partnership

Possibly expand consumer base/target

Stakeholders Perspectives

A stakeholder is anyone who will be affected by the decision of the business. The stakeholders of Riordan Manufacturing include the board of directors(VP of R&D, COO, VP sales & marketing, CIO etc.), employees and consumers.The board along with the owner, Micheal Riordan, made the decisions to switch from single salesperson processes to team based strategy. The problem they must deal with is how to boost employee morale so that the company’s new strategy, along with production, will be a successful one. Some on the board believe that the company’s current compensation package is fine, while others think that there should be more incentives added. Employees feel that they are undervalued and are not sure of the current promotion structure, in other words, how can we(employees) get promoted. Also, certain departments feel they should get compensated more than others ( Engineers feel like they deserve more than sales team). The employees think that they are not getting paid equally like their competitors. From the consumer view point, any change in compensation package could ultimately alter the pricing for their product, in that if Riordan increases their monetary packages, for example, then they would have to increase the cost of their products to help cover the expenses.

Problem Statement

Riordan Manufacturing will have the opportunity to improve production along with employee morale by implementing new compensation packages and benefits that could make Riordan competitive once again and establish itself as one of the best companies.

End-State Goals

The end-state goals are the what the company wants to achieve within a certain timeframe.(3 years)

Increase marketability/profit by 25%

Reduce turnover rate by 5%

Improve overall employee rating of company by 10%

Alternative Solutions

Riordan Manufacturing will research several options in order to come up with the right solution for their problems. Riordan benchmarked S.C.Johnson, a household goods products, ranked in the top 10 companies to work for. They have faced many of the same situations Riordan is facing today. S.C. Johnson has maintained its longevity and success by sticking to it philosophy of believing that its” fundamental strength lies in our people“ ( Johnson, 1976) . They maintained this philosophy by creating what S,C, Johnson called is a balance and diverse workplace’s. S.C. Johnson believes in putting the needs of its employees over that of it corporation's agenda. S.C. Johnson has develop programs they feel will give a good balance between work and home responsibility. They have in place flexible work schedules so that employees can take care of home needs while still maintaining a very productive level