Human Resources Transformation Plan Motors and More, I

Running head: HUMAN RESOURCES TRANSFORMATION PLAN MOTORS AND 1

Human Resources Transformation Plan

Motors and More INC.

William Davis, Nicole Graham, Rhonda Sarli,

Dorane Dixon, Kimberly Dalrymple, Michelle Adkins

Keller Graduate School of Management

HUMAN RESOURCES TRANSFORMATION PLAN MOTORS AND 2

Table of Contents Motors and More INC. Business Strategy ...................................................................................... 5 Situation Analysis ........................................................................................................................... 5

Environmental Analysis .............................................................................................................. 5

Industry Analysis ......................................................................................................................... 5

Organizational Demographics Analysis ...................................................................................... 5

Internal Analysis Tools ............................................................................................................... 6

Industry Competition ................................................................................................................... 6

Strengths, Weaknesses, Opportunities and Threats Analysis (SWOT) .......................................... 8 Strength: ...................................................................................................................................... 8

Weakness ..................................................................................................................................... 8

Opportunities ............................................................................................................................... 9

Threats ......................................................................................................................................... 9

Porters Five Forces Analysis (Motors and More) ........................................................................... 9 Threats of New Entry ................................................................................................................ 10

Supplier Power .......................................................................................................................... 10

Threat of Substitution: ............................................................................................................... 11

Competitive Rivalry: ................................................................................................................. 11

Buyer Power: ............................................................................................................................. 11

Workforce Strategy ....................................................................................................................... 12 Human Resource Structure ........................................................................................................ 12

Recruitment and Placement ....................................................................................................... 13

Organizational Roles and Responsibilities ................................................................................ 13

Strategy for Performance Differentiation .................................................................................. 15

Key Strategic HR Services ........................................................................................................ 15

Strategic Workforce Scorecard ................................................................................................. 17


Evaluate HR Metric Measurement ............................................................................................ 18

Staffing Strategy ........................................................................................................................... 19 Recruiting .................................................................................................................................. 21

Selection Method ....................................................................................................................... 24

Types of Interviews ................................................................................................................... 25

Total Rewards Strategy ................................................................................................................. 27 Compensation ............................................................................................................................ 29

Benefits ...................................................................................................................................... 31

Non-Financial Rewards ............................................................................................................. 34

Strategic Mix ............................................................................................................................. 35

Other Rewards for strategic workforce alignment .................................................................... 39

Strategic Direction ........................................................................................................................ 39 Internal Equity ........................................................................................................................... 39

Market Competitiveness ............................................................................................................ 40

Individual Rewards’ Distribution and their alignment to Performance Management .............. 41

Compensation Strategies that may enhance the Total Reward Strategy ....................................... 42 Pay for Performance .................................................................................................................. 42

Broadbanding ............................................................................................................................ 43

Group Incentives ....................................................................................................................... 44

Training and Learning Strategy .................................................................................................... 44 Training Needs Assessment ...................................................................................................... 45

Needs Assessment ..................................................................................................................... 45

Need Assessment Methods ........................................................................................................ 47

Training Content Development ................................................................................................. 49

Evaluation Tools to Measure Training Success ........................................................................ 49

Level 1: Reaction ..................................................................................................................... 50


Level 2: Measure learning ........................................................................................................ 50

Level 3: Assess behavior change on the job............................................................................. 51

Level 4: Measure results .......................................................................................................... 51

Training Modalities ................................................................................................................... 51

Simulations ................................................................................................................................ 52

OJT (On-the-Job Training) ........................................................................................................ 53

Classroom .................................................................................................................................. 54

Costs of the Modalities .............................................................................................................. 54

The Cost for OJT ....................................................................................................................... 55

Cost Elements ............................................................................................................................ 56

The cost for classroom training ................................................................................................. 56

Succession Planning .................................................................................................................. 56

Performance Management ............................................................................................................ 58 Criteria for Measurement .......................................................................................................... 59

Appraisal Methods .................................................................................................................... 60

Feedback .................................................................................................................................... 61

Rewards ..................................................................................................................................... 64

Strategic Alignment ................................................................................................................... 66

Human Resources Information System ........................................................................................ 66 Measurement of the HRIS Strategy .......................................................................................... 68

Make or Buy Analysis ............................................................................................................... 68

HRIS Access Protocols ............................................................................................................. 70

Conclusion .................................................................................................................................... 72 References ..................................................................................................................................... 80


Motors and More INC. Business Strategy

Motors and More INC. is a thriving business-to-business company that specializes in the

manufacturing of small motors and accessories for industrial and home products. The

organization is located in Middle Field, OH. The organization population is approximately 116

people. The Mission and Vision Statement of Motors and More are as follows:

• To be leaders and innovators in new markets and products. Our goal is continual growth

and development. To be First to market, to respond to competitive and rapidly changing

markets, and to provide customers with the highest level of product and service.

Situation Analysis

Environmental Analysis

Motors and More reside in a southern town with a population of 28,000. The town’s

current unemployment rate is 3.1 percent. This suggests that the population majority (between

ages 18-40) is full-time employment. The majority of the local businesses in the community have

begun to unionize. The community is experiencing growth in both Hispanic and Kurdish

communities. The nearest access to an educational facility is 50 miles, which consist of both a

technical school and community college. The local labor department is approximately 48

percent.

Industry Analysis

The motors and accessories industry for Motors and More is an expanding market and

demand is high (IBISWorld, 2013). The company has a strong market segment and solid

customer base. Because of the organizational setup, the company has been able to maintain gains

and adjust to rapid change in the expanding market.

Organizational Demographics Analysis

The company of 116 employees comprised of the following demographic breakdowns:


• 80% Caucasian.

• 10% Minority

1 Employee Female

• 115 Employees Male

• Highest Education Level: HS Diploma or GED

Internal Analysis Tools

To determine effectiveness, process output, and performance of the organization is the

use of a Goal Approach, which represents a Contingency Approach to Measuring Organizational

Effective. The use of the Goal Approach allows for identification of output goals and assigns

how well the organization has attained those goals (Daft, 2004). This method examines output,

profit and customer satisfaction through the organizational processes it takes to reach specified

parameters. Other tools to examine internal processes would be Six Sigma and Lean Principals

Methods. The use of Six Sigma would allow Motors and More Inc. to examine both internal and

external processes, cut redundancies, identify anomalies in the process, restructure and realign

the organization.

Industry Competition

In the small engine parts and accessories, market (Motor Vehicle Parts Manufacturing

Industry) the competitors for Motors and More are as follows:

Cumming INC.

Location: Columbus, IN

Employee Population: 46,000

Annual Revenue range: $13 Million to $18 Million

Gross Margin: 19% to 26%

Return on Assets: 23% to 27%


Description: They design, manufacture, distribute and service diesel and natural gas

engines’ electric power generation system; and engine-related component products. (Cummins

Inc, 2013).

• Strengths: This organization has a strong customer base, Wide range of products, and

good financial management structure.

• Weakness: No branding identity, they target a specific sector of small engine

manufacturing sector. Their main emphasis is on large diesel engines.

Delphi Corp

Location: Troy, MI

Employee Population: 146,000

Annual Revenue: $16 Million

Description: Supplier of vehicle electronics, transportation components, integrated

systems and other electronic technology (Delphi Corp, 2013).

• Strengths: Vibrant customer base and strong market sector. They have an established

niche in the areas of electronic manufacturing. Highly structured organization and

dedicated labor force.

• Weakness: Lack of variety in products. Weak financial structure (loss of equity) and a

rigid organizational structure.

Both competitors are in the Top 10 of the industry. However, because of the large size and

highly centralized organizational structures of these two firms, they are unable adjust to rapid

market changes thus, the reasoning for specialization in specific areas of small motors and

accessories (note: Delphi Corp’s concentration is in large engine designs). These organizations

will attempt to dominate Motors and More by staying within their niche, by reinforcing their

market concentrations in an effort to block entry into that market segment. Motors and More can


retaliate by infiltrating the market segments that these organizations have failed to solidify. By

capturing, the areas that their adversaries have overlooked will allow Motors and More to

establish more of its brand identity, increase its revenue, and seize more of the market.

Strengths, Weaknesses, Opportunities and Threats Analysis (SWOT)

Based on the Situational Analysis we conducted a SWOT Analysis on Motors and More

INC.

Strength:

• Motors and More have a strong customer base and market share.

• Establish strong branding niche of the organization in the market.

• Strong ties within the community.

• Its flat organization structure makes it more agile and responsive to shifting within the

market and changes to customer needs.

• Our products produced are durable, long lasting and made of top quality materials.

Weakness:

• No diversity in the organizational structure: A lack of diversity leads to the following

effects:

o Decreased Productivity

o High turnover rate

o Reduced morale

o Decreased client relations

o Decreased company morale

o Decreased creativity

• Low Labor Pool: High turnover rate has resulted in vacancies that the organization has

been unable to fill.


• Lack of training and education: Current employees lack essential training and education

to elevate the strategic objective.

• Insufficient product output: Due to low labor pool, the organization lacks the work force

to increase manufacturing and supply output to meet expanding demand.

Opportunities

• Obtain capital to expand the organization to a Matrix Structure

• Consult with Technical School and community college to establish training and

apprenticeship programs. Train existing workers and higher workers with more

education.

• Create recruiting program that will increase a more diversified workforce. Establish ties

with growing Hispanic and Kurdish communities.

• Improve existing environment for the work force.

Threats

• The local labor departments are starting unionization.

• Lack of education and organizational diversity can stall innovation, company growth

resulting in eventual existing from the market.

• Growing competition from overseas competitors (China and India) entering U.S. Market

capturing our market share

• Other existing U.S. competitors capturing our markets segments

Porters Five Forces Analysis (Motors and More)

To better analysis the business strategy and its relationship to other internal/external

forces, we utilized Porter’s Five Forces Analysis to determine our power structure and the power

structure of other forces in the different areas of our market sector (Daft, 2004). This tool will


provide assistance with understanding our current situation and the end state to which we want to

move. Thus, identify external forces that could be potential barriers to moving forward (Daft,

2004). The analysis is broken in five specific categories. The Five Force Model for Motors and

More is displayed in Table 1.1.

Threats of New Entry:

• Easy to enter market: The small motors and accessories is an expanding market. Thus, it

is easy to enter and corner a market segment.

• Labor force abundant: U. S unemployment rate is high in most states. It will be easy for

new competition to post for employment opportunities.

• Experience: Competition can find employees with experience to fill specific position

within the organization.

• Training available: The competition can develop training programs to fill manufacturing

positions.

• No barriers to entry: Because of the expanding market there are little to no barriers to

establish a market share.

• Expanding market: Growing demand in both U.S. and overseas markets for small motors

and accessories.

Supplier Power:

• Many Suppliers: Because of the expanding market, you have a robust of suppliers in the

market.

• Suppliers sizes vary: Depending on their market, most suppliers have established strong

branding and market segments.

• Similar products brands: Most suppliers will distribute similar products to compete with

other suppliers.


• Able to change: Supplies have the ability to adapt and change to market demand.

• Able to substitute: Suppliers have the ability to provide a substitute for their products.

Threat of Substitution:

• Many Substitutes: Growing market has created many product substitutions.

• Encroachment from Overseas suppliers: There is a growing market in China and India

for product similar to the products we produce.

• Many cross-substitutions: Expanding market has created cross variation or generic

brands of our products on the market.

Competitive Rivalry:

• Many Competitors: Our market has many competitors

• Strong market shares: The Top 10 in our market have large organizational structures and

good capture of their market segment.

• Strong Customer Base: The top competitors in our market have established their

branding to their customers over time to produce strong customer loyalty.

• Strong brand products: The competition has strong product brand that have met or

exceeded market standards.

• Highly Trained Workforce: The Top 10 competitors have assembled highly trained

personnel to project their organizational branding out to their respective market

segments.

Buyer Power:

• Many Customers: The current market has a cadre of customers in many areas. No one

segment is constricted or has a consolidated area.


• Maybe subsidiaries: There exists the possibility that some medium customers may be

subsidiaries of larger organizations.

• Maybe Small Business: There exists the possibility that some customer segments are

under ownership of small business.

• Purchase Large Orders: Customers have the purchasing ability to request and procure

large order request.

• Able to substitute: Because of the market size, customers have the ability to look for

substitutions from other suppliers.

• Medium/High purchasing Power: Customers have sufficient capital to purchase form

suppliers. This ability can also sway market prices.

Workforce Strategy

Human Resource Structure

Motors and More does not currently have an existing Human Resource department. Our

goal is to continue to apply attention on growth, innovation, and development of new products.

Our current management structure is a flat management system. Due to the non-existence of a

Human Resource department, several concerns have surfaced such as overlapping roles and

responsibilities, increasing complex work environment, unrealistic expectations of key

initiatives, and managing an accelerated work environment of environmental changes. The

purpose of this analysis is to address effective strategies to develop a Human Resource

department that can support our global expansion. It is important to Motors and More to

approach managing our employees by maximizing their motivation and contribute towards

meeting the organization objectives. The ultimate aim is to reach our mission and vision through

a design and implementation of a Human Resource department (Bartlett, 1990).


Motors and More’s vision is to be leaders and innovators in the global new market and products.

Therefore, we must establish functions and roles which effectively demonstrate and identify our

key objectives to successfully support this realignment:

Recruitment and Placement

• Hire top management talent that is committed to our organizations philosophy to meet

key success in achieving organization objectives

• Develop strategic linkage of our departments to align with our company mission, vision,

and objectives

• Apply attention to reconfigure our Human Resource department by applying strategy to

breakdown our roles, responsibilities, and function.

Organizational Roles and Responsibilities

Human Resource VP:

• Responsible to lead, direct, and manage our department with solid relationship skills to

grow our department to meet goals and strategies that fits the senior management

expectations

Human Resource Manager:

• Directs, coach, train, recognizes and manages performance. Key assets planning and

reviewing sessions to share results of initiatives.

HR Generalist (full-time/part-time):

• Responsible for conducting background checks, creating job descriptions, contract

development, manages onboarding/off boarding, supports employee relation such as:

ensure diversity, manage labor laws, develops employee policies and procedures, ensure

appropriate accommodation for disabled employees, develop a reward and recognition

system, etc.


Talent Managers:

• Responsible for screening candidates using software such as: assessments and

applications; present offers, hire temporary staffing, and advertise openings.

Benefits Specialist:

• Develop and negotiate contracts with medical, dental, and comprehensive benefit plans,

administer plans for health, dental, and 401 (k). Risk Management/Worker’s

Compensation, a full-time employee, conducts inspection to determine compliance with

OHSA, implement SOPs to ensure safe work environment, administer worker’s

compensation plans, and conduct frequent audits on claims processing for compensation.

Training and Development Manager:

• Direct, guide, lead, coach, facilitators by presenting information to elevate individual

development to develop future leaders, provide refresher training courses, address

performance and skill development. Conduct observations and feedback to facilitators on

effectiveness and implement new training ideas.

Training Facilitators:

• To lead, coach, develop, and train new and existing employees in various roles,

implement new training plans, present organizational instructional design training

components by preparing materials, visual aids, manuals, etc.

The visual breakdown of these newly formed positions within Motors and More’s HR

Department can be seen in Table 1.2. The applied attention on establishing different role

functions will support the growth plan and will play a significant role in the return-on-investment

of our employees in varied positions due to the development of a qualified and experienced

Human Resources Team. The long term effects of a Human Resource strategy is to develop a

talent pool of future leadership and identify talent that could be bench strength for other positions


due to a leadership development. Due to this organizational shift, it is important to develop

varied levels and differentiate “key jobs” into levels identified as A, B, and C (Change Minds,

2013).

Strategy for Performance Differentiation

Typically, employees who are identified as our “A” employees are top performers are

employees who always exceed and meet high achievement expectations. Normally, these

employees are eventually in our key positions of leadership or being developed for leadership as

a part of our solid talent pool. These employees are very knowledgeable and effective in their

role. Next, we have our “B” employees who are consistent in meeting fully effective results in

their role. This is where the bulk of the value is being spent with minimal supervision. These

employees don’t typically go above and beyond in their role (Change Minds, 2013). Supervision

is still required to provide additional coaching and feedback with the expectations to eventually

make an impact and elevate them to “A” players over time. The ROI is necessary to develop an

employee who could fill a future leadership opening with the right support and development.

Now, our “C” employees are mainly individuals we are focusing our constant training and

development on to help improve their skills set. The risk is that these employees may either self-

Key Strategic HR Services

Several key initiatives that Motors and More, Inc. is seeking to apply focus on are the

growth and strategic development of its organization. HR practices are a vital part of the strategic

human resource management (SHRM) to ensure we are using reliable and creditable resources to

develop our plan. It is necessary to utilize SHRM as a resource to review what other

organizations or case studies conducted to support development of solid business strategies

(Azmi, 2011). The growth in employee skill set and experience is essential to the expansion of

the future global organization, and will help with such things as;


• Applied concentration on higher education with associate degrees or higher in our

leadership roles and partner with other colleges more than 50 mile radius Recruit

directly at the local community college for leadership positions with an interest of hiring

diverse employees such as: minorities, varied cultures, and supporting the community of

Hispanic and Kurdish descendent. Future expansion leadership being promoted from

within to lead in leadership roles in our expanded markets targeted abroad.

• Emerge as a solid competitor in the manufacturing industry through major focus on

human resource practice (Kim, 2012) and consistent market research. Provide a solid

talent acquisition strategy to grow the organization with employees that are the best fit

for our culture. Develop, implement, and institute a solid reward system to help promote

effective behavior to improve productivity

• Develop and train employees on the history of the organization and specific role

responsibilities with periodic refreshers to solidify training and development. Institute a

referral system that will help identify other employees who may be a suitable fit for the

position to help with the finding of qualified candidates (Kim, 2012).

• Incorporate a leadership program to help develop a pool of talent top echelon employees

who were referred to the program based upon annual appraisal and management

recommendation. Address and evaluate Labor Relations regulations and policies to

enforce with regular review of the process.

• Organize and effectively roll-out a solid recognition program with rewards for positive

employee behavior (Pathak, 2013).


Strategic Workforce Scorecard

A workforce scorecard (Table1.3) is essential to the overall success of the workforce

management to determine how to evaluate the ROI of our employee’s development plan.

Development of a scorecard and specific action areas that are tracked will support our alignment

to demonstrate measuring results (Axsium Group, 2013). It is critical that we take a holistic

evaluation of the scorecard to manage a well-rounded system to truly measurement our targets

and expectations to achieve success. Also, the scorecard can help determine if continuous

improvement is necessary for our employees to institute appropriate training and development

methods. The scorecard will assist with determining the value of employees in their work

performance over an 18 month period to help improve the productivity and revenue due to

evaluating our employee performance on a periodic basis (Becker, Beatty, & Huselid, 2005).

The key HR strategies aligning with the practices of the HR Services will be stepping

stones to the success of helping develop a solid culture fit to help develop our key differentiation

players. Based upon the success and execution of our strategies we will see an increase in skill

set and workforce competencies along with employee development to support the increase of

customer satisfaction, process effectiveness, and more importantly, increased revenue. These

areas will not be successful within the consistency and implementation of a HR strategy that has

“buy-in” from the leadership team and proper training on how to effectively communicate

employee’s growth plan to elevate their success level (Becker, Beatty, & Huselid, 2005). A

challenge that is faced is consistency with executing the workforce strategies. If the strategies are

not instituted effectively this could be a major threat to the success of the plan. Therefore, the

workforce strategy is the management and execution of the workforce strategies Motors and

More, Inc. needs to be successful in the role of their workforce management plan. The

measurement of success of a workforce management strategy is through specific metrics


identified to help measure the effectiveness and even identify limitations of the organizations

existing strategies.

Evaluate HR Metric Measurement

The scorecard (Table 1.3) helps determine limitations organizations may face with

financial identifiers associated with performance. The metric measurement aids in evaluating

specific areas to measure and determine success (Becker, Beatty, & Huselid, 2005). For example,

Motors and More, Inc. wants to ensure we are our performance is yielding results to improve

financial deliverables. By measuring performance of employees it allows Motors and More, Inc.

determines who are valued and contributors who need additional development (Stamps, 2000).

The following measurements are critical to the growth and development of workforce

management strategy:

• Cost per hire

• Revenue per employee

• Expense % per compensation

• Revenue % per compensation

• Compensation % per benefits cost

• Time to fill jobs

• Time to start jobs

• Ratio of Offers per acceptance

• Attrition

• Turnover rate

• Worker’s compensation cost per % expense

• Worker’s compensation cost per employee


• Worker’s compensation cost per claim

• HR Department Expense per employee

• HR Headcount Ratio

The development of a workforce system to improve high performance can be delivered

with HR Systems with significant differences in organizational effectiveness. The benchmarking

employee’s skills and behaviors will evaluate turnover and absenteeism development of

employee assistance and work-life balance programs to help enable employee success (Carlson,

2013). Nowadays, organizations invest in HR systems that will analyze and provide real-time

reports to managers to manage day-to-day efforts. The reports and metrics influence the

organization on making drastic changes or making necessary improvements strategically meet

organization strategies. Often times, adjustments must be made to determine if forecast will be

missed or if adjustments need to occur during the quarterly review with the Executive team to

realign the current plan (Carlson, 2013). Organizations have developed systems that are designed

to measure performance and found tweaks were necessary due to not seeing a strong connection

between the success and metrics. It was apparent that there was no strong clear and compelling

connection. Therefore, organizations will discontinue the process and regroup to strategize new

ways to measure success. Another critical area would be assessing how to motivate employees

and develop talent through creating value through a recognition system to help determine success

(Stamps, 2000).

Staffing Strategy

Motors and More have determined that they have a need to hire across the organization.

The company does not have an existing Human Resources department with the capability to

assist the organization with meeting is staffing requirements. To establish an functional HR

department(Table 1.2), Motors and More will be required to hire an HR Manager, at least one


full-time HR Generalist, a part-time HR Generalist, three (3) Talent Managers, one (1) Benefits

Specialist, one (1) Worker’s Compensation Specialist, one (1) Training Development Manager

and two (2) facilitators (see Figure 1). As the business expands and a necessity is found to hire

more employees, the department will be increased.

The remaining organization of Motors and More is looking to increase staffing within

eighteen (18) months with 225 to 300 new employees (Table 1.4). Over the next five years, the

goal is to have a total of 500 employees. Staffing this rapidly can be very costly, and there will

be a greater need to access more capital. To eliminate the upfront costs temporary agencies will

be employed to fill these positions.

Turnover is an issue that every organization has to deal with on a daily basis. When

employees leave, they are leaving for a variety of reasons and will generally not indicate the real

reason. Employees of Motors and More are leaving for the following reasons:

• Retirement

• Job dissatisfaction

• Robust Labor Market

• HR issues

• Personal or family reasons

• Relocating

• Values

• Lack of diversity

• Work environment

Managers believe that employees are leaving for financial reasons but this is not always

true (Branham, 2005). While 89% of employers believe that employees leave for financial

reasons, 12% of employees actually leave for that reason. Eleven percent of employers believe


that they leave for other reasons, 88% of employees leave for other reasons. Employees leave

for the reasons mentioned above. Motors and More need to understand these reasons and learn

how to turn the issues around (Branham, 2005).

Organizations do not realize how much it really costs to replace an employee. For

example, the company could lose $1,575,000 per year due to turnover costs if the average salary

of an employee is $35,000 and there is a rate of 15% for turnover. If the company is able to

determine the root cause of the turnover and fix it, they could save $1,102,500 per year

(Branham, 2005).

Recruiting

When a position has been identified as vacant, this is when the recruiting process will

begin. There are several reasons why a position becomes vacant. These include creating a new

position, termination of a position or an employee, and employee resignation (Hakala,

HRWorld). The HR Department would create the process that will analyze the necessity of the

position. This would include a staffing template that will help to determine the most qualified

candidate for the vacant position.

The first step that needs to be completed is a needs analysis. A needs analysis is a tool

that is used to determine exactly what they are looking for in an employee. This analysis will

help them to determine when and how to advertise and how the job will change over the next few

years. Below are questions that will need to be asked:

• What kind of person would complement the skills of the team already in place?

• Is there new technology infiltrating the industry or environment with which this

individual must be familiar?

• What type of personality is the supervisor of this position, and what style of management

does he/she use?


• How large, small, or closely knit is the current team?

• Is this a long-term, growth position or simply a contract position that will be around for

only a year or so?

• What kind of person will “fit” with the team in place and the mandate or long-term vision

of the company?

• Do your clients and customers have specific needs and demands that would be best

supplied by a certain type of individual?

• Will a degree be required? Bachelors’ or Masters’ degree

• How many years of supervisory experience will be required?

The HR Department will be responsible for the sourcing plan. There are ways to locate

candidates but it needs to be cost effective. The first thing Motor and Mores need to do is to

locate employees that would be interested in promotion. This causes the morale to increase

when internal employees are promoted.

The best method to recruit is through the development of an Employee Referral Program

(ERP). The use of a strategic ERP has produced double the returns than that of any standard

processes (Sullivan, 2011). Customers and suppliers could be approached and asked if they know

of anyone who would be interested in working for Motors and More (if they are local). To

encourage employees to refer their family and friends, the company would offer $250 as an

incentive provided the new employee passes the probation period. If the company decides to do

their own recruiting, how will this be done? Does the organization have a website? What are the

costs to advertise via local newspapers? Can jobs be posted at the local schools?

Using a temporary agency is going to be the least costly especially if the company does

not have a website to advertise on. The temporary agency is responsible for finding the qualified

candidates by screening them to include testing to make sure the candidate is qualified for the


position. The temporary agency also takes on the initial cost of drug screening and background

checks. The drug screening and background checks are costly start-up costs for Motor and More

but would allow the company to try the employees out and choose the ones that are the best

qualified after approximately 90 days. If the company has a website, a link to the temporary

agency(s) would be provided to assist anyone interested in working for Motors and More.

There are several areas of discrimination that Motors and More will need to be aware of

and to make sure they are following the Civil Rights Act of 1964, Title VII:

• Equal Pay – It is required by the Equal Pay Act that the company provide men and

women with equal pay for the same work. Although, it is the job content that will

determine if the job is equal but does not have to be identical. This law covers all aspects

of pay to include salary, overtime, bonuses, life insurance, vacation and holiday pay, and

all other forms of benefits. If there is difference in pay, the wages cannot be reduced but

increased so that the pay is equal (EEOC).

• Sex Discrimination – This type of discrimination is used when treating employees

differently because of their sex. It also pertains to treating employees differently when

they have a connection to an organization that has to do with people of a certain sex. It is

against the law to harass someone because of their sex which includes sexual advances,

sexual favor requests, and any other type of verbal or physical harassment to include

offensive remarks (EEOC).

• Racial/Ethical Discrimination – This is based on the employer using race against an

employee or candidate because of their background to include the color of their skin,

their hair, and other facial features (EEOC).


• Age Discrimination – It is against the law to discrimination against an employee or

candidate over the age of 40. This includes the hiring, firing, and/or reducing wages

(EEOC).

The HR Department will need to invest in an Applicant Tracking System. This system

would help with the recruiting, evaluating, and hiring the most qualified candidate. The first

thing that would need to be done is to write job descriptions to fit each position that they have.

The open requirements should be written to allow the best qualified candidate to be hired. The

requirement needs to be strong and cover all qualifications sought with in a candidate. By

looking for keywords within the on-line application, they will be able to determine the best

candidate. Once they have identified the best candidates, they would need to develop a way to

evaluate them. Depending on the position, will determine how this would be done.

Selection Method Evaluation of potential staff members would be for the professional staff. For the

manufacturing staff, the temporary agency would perform the testing. When Motors and More

hires a professional employee, they could evaluate them in different ways depending on the

position that they are hiring them for.

• Candidates will need to take a skills test on line. The skills test is an effective way to

narrow down the selection field. The test will be valid as it will test the skills and

knowledge of the candidate.

• Administer a PI test – Predictive index test to ensure that the employees are suited for the

company. The validity of this method tests the dominant psychological personality types

of an individual. The information can be used to evaluate the fit with the culture of the

organization and how well they will work with others- the test is predictive.


• The phone interview would be the next step. The phone interview would cut down on the

number of applicants that are interviewed face-to-face.

• Candidates must pass a back ground check and be drug free.

• Candidates must meet the physical standards and be able to sit or stand for 8 hours. They

must be willing to work overtime when needed.

• Depending on the position, the company could prefer a Bachelor’s degree and/or related

experience. The level of experience would depend on the position being filled.

The temporary agency would evaluate potential hires for the manufacturing, operations,

customer service, maintenance and cleaning positions. The temporary agency would be

responsible for the initial cost and confirm the following:

• Candidates must pass a back ground check and be drug free, must meet the physical

standards – be able to sit or stand for 8 hours and must be able to lift 40lbs without help,

must be willing to work overtime when needed.

• Must have high school diploma or GED.

• Must be able to read and write English.

Types of Interviews

There are several types of interview styles that can be used to interview prospective

employees especially our professional ones. One type of interview style is the situational

interview. This type of interview will help Motors and More to identify the candidates who can

take a step back, consider what the alternatives are, and choose what the best course of action

will be. This is a great way to determine if the candidate cannot only do the work but is willing

to do the work which will make them an effective and motivated member of the team (Fry,

2010).


The behavioral interview is another type of interview style. Using this type of interview

will allow the company to have the candidate focus on their past experiences and questions can

be ask that are probing in order to get them talking. When asking these types of questions, they

would be looking for the candidate to identify the problem, what action was taken, and the result

that was achieved. The company wants to know how the candidate handled themselves in a

situation, what kind of on the job situations did they get through, did they do the right thing, and

what are the results of decisions that were made. Motors and More wants to be able to

understand what happened, why it happened, and what did they learn from the experience (Fry,

2010).

A third type of interview would be the structured. This is an assessment that is designed

to measure the competencies of the candidates that are job related by asking about their behavior

in previous experiences and how they would behave in other situations. This would allow all

candidates to have an equal opportunity to provide information and to be assessed by the

recruiting team accurately and consistently.

The effectiveness of our recruiting efforts can be assessed several ways. One way is by

calculating how much it cost per new hire. In order to determine this calculation, all of the

recruiting costs would be totaled up and divided by the number of new hires. Another way is to

determine the yield ratio. The relationship of applicants at one stage of the hiring process to

another stage at different decision points is known as the yield ratio (Heneman, P. 207). The

selection ratio is another way to assess the recruiting efforts. The lower the number, the

predictor will be more useful. If the selection ratio is low, then they are selecting successful

employees. To determine this ratio, they would divide the number of applicants hired by the

actual number of applicants (Heneman, 2009).


Organizations realize the benefits of retaining a current employee and they understand the

costly amount of turnover. Loss of company knowledge is a critical issue because when the

employee leaves, the knowledge leaves with them. Everything they know about the company,

customers, projects, and the history are lost. Time and money have been spent anticipating a

return on the employee and the investment is not realized once the employee leaves. So in this

case, a benefit to retention would be the knowledge that the employees brings to the

organization. Another benefit is that the employees are usually prepared for a new position and

they are ready to be promoted. By promoting internally, this would save time and money on

recruiting. When the organization is able to retain employees, it will develop a stronger and

more skilled work force. They are able to teach others and share the knowledge that they have.

Customer service is another important part of the organization and employee retention will have

a position affect. With turnover brings disruption which could cause a loss in business and

negatively. Retention is cheaper than recruitment, retention builds job stability and production

levels do not fluctuate because of lack of employee morale or staffing (Sunil Ramlall, 2004).

Total Rewards Strategy

An organization’s total rewards system is based on compensation and non-compensation

elements (Nelson, 2010). These elements may range from base pay, benefits for compensation

rewards, growth opportunities for non-compensation rewards and job satisfaction. The total

rewards system consists of any and everything employees may value and what an employer has

the ability to offer and will offer to potential and current employees (Nelson, 2010). If the total

rewards strategy is successful, the strategy will allow the company to grow and become

competitive in the market. One of the best practices of benefits in the workforce is to design a

rewards system that will influence human behavior in a positive way to accomplish the business

strategy of the organization (Nelson, 2010). Organizations must consider many elements in


designing a proper benefits rewards system. Organizations should identify and communicate to

potential and current employees’ benefits the organization has to offer as well as get an

understanding of what the employee value in terms of benefits and motivation. In order to be

competitive in the workforce, Motors and More will have to evaluate and determine what type of

total rewards the organization can offer, what rewards matters to recruiting new employees and

what rewards are needed to retain current employees. Designing and implementing the right

total rewards system that has a combination of both financial and non-financial rewards offered

to employees who can increase individual and organizational performance, employee loyalty and

workforce morale (Heneman, 2007).

The total rewards strategy of Motors and More must be a blend of financial and non-

financial rewards to create a balance of what current employees and potential employees may

seek from an employer. Motors and More must create a strategy that is unique for the

organization and in line with meeting the business strategic goals. Creating a blend of financial

rewards should include reduction of in employee turnovers, improving employee morale, support

employee growth development through promotions and training, implement diversity and job

satisfaction, which will increase job performance. Motors and More must learn to balance

between their needs and the needs of their employees in order to create a cohesive working

environment that will attract and retain employees in a competitive field. Offering a total

rewards strategy with benefits should be carefully communicated to employees and potential

employees, should reduce turnovers, should create a healthy working environment, increase

morale, provide work-life balance, encourage career development and employee growth and

create a sense that the employee wants to exceed in their job performance (Nelson, 2010).

Potential employees often make a decision to work for an organization depending on

what type of compensation and benefits an organization offers. Current employees often make


decisions to stay with an organization through motivation based on the type of compensation and

benefits package the organization offers. Motors and More will focus on compensation, benefits

and professional growth in attracting and retaining employees. The organization will reflect on

not only on compensation, but personal and professional growth opportunities and a motivating

work environment to include recognition and work/life balance (Heneman, 2007). Motors and

More must recognize the areas in which the organization is lacking and focus on correcting these

areas in order to be competitive in the market area. In order for Motors and More to implement a

total rewards strategy the organization must perform an assessment, develop a design, execute

the design and then evaluate the design to see if it is effective (Heneman, 2007). If the total

rewards package is in line with the business strategy and goals, the organization can accomplish

meeting their long-term and short-term goals. Motors and More will need to focus on attracting

potential employees, retaining the employees, rewarding employees performance through total

rewards strategy and to ensure the total rewards strategy is cost-effective and affordable for the

organization (Meglich, 2011).

Compensation

Compensation is how an employer pay employees for work performed. Compensation

can often be the determining factor of a potential employee accepting a job offer or a current

employee leaving the organization. Motors and More is an organization that operates on a

traditional compensation plan by compensating their employees through minimum wage and

statutory benefits. In Ohio, organizations may compensate their employees through minimum

wage in the amount of $7.85 (Commerce, 2012). Properly compensating employees for their

work performed by offering higher pay can reduce turnover, create job satisfaction and increase

motivation in the workforce. Compensation total rewards focuses on an employee’s motivation

and what motivates that employee to produce the desired performance for their employer


(Meglich, 2011). Human Resource Managers must practice, understand and determine what

motivates employees and how to best develop a program to meet the needs of the employees and

remain in line with the organization’s business strategy. The role of compensation is to provide

employees with monetary forms of payment in exchange for work performed. The monetary

payment can be based on compensating an employee through wages, salary, bonuses, shift

differentials and/or special skills and commission (Nelson, 2010). Wages is a monetary

compensation where the employee is paid on an hourly, weekly or monthly basis and is based on

the number of hours an employee work including overtime. Compensating employees based on

salary consist of paying individuals as exemption employees on a weekly, bi-weekly, monthly or

annual basis and not based on the numbers of hours worked and does not include overtime

(Nelson, 2010). Wages and salary pay is the most common form of compensation amongst

organizations and often times the most preferred by individuals and the best practice to offer

potential and current employees in exchange for their time to complete an assigned task.

Bonuses, shift differentials and commission are determined based on what type of compensation

rewards an employer decides is more effective for their company. Motors and More can

effectively pay each employee based on the level of experience, education and performance in

accomplishing the company’s goals. Offering a fair and competitive pay scale allows Motors

and More to attract, recruit and retain the best employees to further the organization’s short-term

and long-term goals.

The effects of compensation can result in employee attendance, employee motivation,

loyalty, tenure, job satisfaction, increased productivity and the need to go above and beyond to

meet the organization’s goals. Organizations must understand what motivates employees in

order to design an appropriate total rewards package to maximize employee contributions to the

organization (Meglich, 2011). Compensating employees fairly can be the determining factor of


which employee leaves the organization, which employee stays with the organization, how

motivated employees are to perform their task and how productive employees are at meeting the

organization’s strategic goals. According to Maslow’s hierarchy of needs, individuals are

motivated by the desire to satisfy their needs and how those needs can be accomplished as an

employee (Meglich, 2011). If the organization does not satisfy those basic needs, employees

may become disengaged, disgruntle, and lackluster in their work performance. Organizations

must focus on developing a total rewards package that is customized to meet employees’ needs,

but remains cohesive with the business strategy. Depending on the individual, compensation

may not be enough of a reward to motivate and increase performance to further the

organization’s goals. Organizations will have to get creative in developing their packages in

order to attract, recruit and retain qualified and talented employees to accomplish the

organization’s goals.

Benefits

The role of Benefits is to provide employees with additional compensation satisfactory to

their needs based on being a part of the organization and sometimes what type of position the

employee holds (Nelson, 2010). Benefits offered by an employer may determine whether a

potential employee accept or reject a job offer as individuals seek a package that is beneficial to

them and their family. Benefits can carry more weight than monetary compensation depending

on what motivates job seeker or employee. Human Resource Managers must understand that

individuals are motivated according to their situations, whether it is their age, gender, marital

status, if they have children and how long they have been with the organization (Nelson, 2010).

These are some of the practices Human Resource Managers must consider in attracting,

recruiting, and retaining employees as benefits offered could be the determining factor of a

candidate accepting the job offer or a current employee remaining with the organization.


Organizations must be competitive in what type of benefits to offer and what benefits are

attractive in the recruiting and retention processes. Benefits such as Social Security,

Unemployment Compensation, Workers’ Compensation and Family Medical Leave Act are

legally required benefits all organizations must provide to employees in addition to basic benefits

(Nelson, 2010). Other benefits such as healthcare, paid vacation and holidays, retirement

savings programs, sick leave and life insurance are some of the basic compensation elements

employers’ offer and potential and current employees seek from an employer (Nelson, 2010).

Motors and More currently offers the statutory, legally required benefits of Social

Security, Workers’ Compensation, Unemployment Compensation and Family Medical Leave

Act (FMLA) (McCain, 2007). Social Security benefits are benefits federally administered

insurance and retirement program funded equally by the employer and employee; Workers’

Compensation is a benefit that protects employees who may be experience a job related illness or

injury on the job; Unemployment Compensation is a benefit that provides income to employees

who may lose their job in order to provide a sense of stability until the individual finds another

job (Nelson, 2010).

FMLA is a federal mandated Act that entitles employees to have coverage if the

employees needs to take unpaid leave for family or medical reasons to care for themselves, an

eligible family member, the birth of a child, adoption and qualified circumstances to care for a

family member of active military duty (Wage and Hour Division (WHD): Family and Medical

Leave Act). FMLA allows for (12) twelve work weeks with in a (12) twelve month period and

allows for employees to return to their same position and if the same position is not available, a

position that has equal status and pay (Wage and Hour Division (WHD): Family and Medical

Leave Act). FMLA can provide added protection in the event an employee meets one of the

elements that will require absence from work. In addition to the legally required benefits,


Motors and More must offer additional benefits in order to be competitive in attracting,

recruiting and retaining employees. Motors and More can offer benefits such as paid holidays,

vacation and sick leave, healthcare benefits to include medical, dental, vision and discounted

prescriptions, vacation and holiday pay, short-term and long-term disability, flexible scheduling

and retirement packages. Offering these types of benefits can result in employee retention,

attracting qualified candidates, boost of performances in current employees and increase

employee morale.

The effect benefits can have on the workforce is based on what type of benefits the

organization offers. Benefits can be costly to employers as employers must ensure they are

receiving an acceptable return in the form of performance from the employee (Heneman, 2007).

The type of benefits an organization offers can be a deciding factor when potential employees

are seeking and considering employment as benefits is one of the reason employees decide to

seek employment with competitors or other organizations. An organization not offering

competitive benefits can experience high turnovers, low employee morale, low performance and

disgruntle employees. Organizations must know and understand what benefits motivates

individuals when selecting candidates for employment and in accommodating their current

employees. Benefits can sometimes outweigh monetary compensation as potential and current

employees may find it important to have medical, dental and vacation benefits in order to have

work-life balance versus high wages or salaries. Organizations who provide work-life balance is

offering employees a system that helps employees balance their work and personal lives. The

benefits of work-life balance can have a positive effect on employee attendance, employee

retention, attracting new employees, boosting morale and providing employees a sense of loyalty

(Maxwell, 2008). Work-life balances can be in the form of flexible scheduling or work from

home systems that can increase productivity and improve employee morale and attitudes. By


offering work-life balance and other benefits, Motors and More can begin rebuilding and

reshaping their organization to increase productivity, reduce turnover and create an environment

of high morale and high performances.

Non-Financial Rewards

The role of non-financial rewards is to reward and compensate employees through means

other than monetary compensation. Non-Financial rewards include career development, status,

the opportunity to work in an exciting and energizing work environment, the opportunity to do

meaningful and challenging work, benefits and non-financial rewards (Heneman, 2007). Other

non-financial rewards to consider are flexible schedules, job satisfaction, autonomy, growth

opportunity, adequate training and resources and recognition and awards (Nelson, 2010).

Employers have numerous non-financial rewards to choose from in order to design a strategy

that best fits their goals and meets the needs of potential and current employees. Determining

what type of non-financial rewards to offer within an organization can be difficult to implement

as human resource professionals must determine a cohesive system that will meet employees’

needs as well as employers’ needs.

Non-financial rewards can have a positive effect on the employees as well as the

organization. Non-financial rewards can be less costly than financial rewards as it does not have

to involve monetary payment. Building a rewards program based on non-financial rewards can

include recognition, career development and growth, job satisfaction, employee development and

training, and awards (Sammer, 2011). Organizations must understand that non-financial rewards

can create and provide an insight of fairness for employees, which will increase retention,

employee morale, job satisfaction and productivity (Sammer, 2011). Motors and More can

create a system consisting of non-financial rewards that can save the organization money, but

also build a working environment that focus not only on their customers, but also on their


employees. Motors and More must focus on career development, as it is one of the elements

needed to increase retention within an organization. Providing career development and

employee training can be a strategically competitive move as the more employees learn and build

on that learning, the more employees will remain with the organization and increase the

organization’s productivity and financial stability. However, employee turnover can be

associated with common reasons due to lack of career development opportunities, negative

working environment, lack of challenging work, not knowing the direction of the organization

and lack of recognition, which all is a facet of non-financial rewards (Sammer, 2011). Motors

and More must evaluate this area of concern, since the company is experiencing unusual high

employee turnovers. In order to reduce turnover and build employee morals, Motors and More

can customize a rewards systems that is a combination of both financial and non-financial

rewards. Creating a total rewards program consisting of both financial and non-financial rewards

would be advantageous to the company as it competes with other organizations in their market

area.

Strategic Mix

• Base wages should be considered when determining what kind of total rewards system

Motors and More would like to customize. Base wages should be determined based on

the job position, experience and difficulty of job duties. For instance, Motors and More

manufacturing employees will be compensated using wages, where employees are paid

on an hourly basis according to their schedule, using shift differential pay. Shift

differential pay is based on first, second and third shift, where second and third shift

employees receive a slightly higher pay than first shift employees. Motors and More will

use a Temporary Agency to recruit and employ additional manufacturer employees

within the organization. The organization will negotiate a contract both competitive and


aligned with the strategic goals and financial stability of the organization. Motors and

More will ensure the Temporary Agency is clear on the wages based on first, second and

third shift differentials. Motors and More will compensate its first shift temporary

employees at a rate of $12.00 per hour and $13.50 per hour for regular employees.

Manufacturers with experience will be paid based on their experience at a starting rate of

$15.00 per hour. Second shift employees should be compensated starting at a rate of

$13.50 for temporary employees and $16.50 for regular employees. Third shift

temporary employees should be compensated at a rate of $15.00 per hour and $18.50 for

regular employees. Non-manufacturer employees, such as staff will also receive wages

depending on their level of experience and education. Managers and Supervisors will be

compensated based on salary where employees are paid as exempt employees not based

on hours or overtime (Nelson, 2010). All employees will be compensated on a bi-weekly

basis and non-exempt employees will receive overtime if the employee goes over their

regularly scheduled 40 hours in a week. Employees who work in sales will be

compensated using a combination plan based on commission and a base salary. In order

to be competitive and attract employees, Motors and More will offer employees who

work in sales a combination plan based on wages and commission for achieving,

accomplishing and meeting the organization’s goals.

• Incentive – Incentives allow an organization to reward employee performances without

adding to their base salary (Nelson, 2010). Incentives can increase production within an

organization in order to meet the organization’s goals. Offering incentives can be useful

to increase productivity and enhance the team environment to get the job done. Motors

and More can offer incentives such as a free lunch for the group with the highest

productivity during that month. Every quarter Motors and More can award the team with


the least amount of accidents on the floor with small gifts or gift cards to show their

appreciation in maintaining a safe and healthy working environment. If more than one

team has the least amount of accidents on the floor, all teams receive a reward that can

range from a day off, company gifts or $25.00 gift cards. Manufacturer workers will

receive free uniforms, but will be responsible for keeping the uniforms clean and in order.

Non-manufacturer workers, incentives would include free jeans days every Friday and a

$25.00 gift card at the end of the year for being loyal and valuable employees. For all

employees Motors and More will provide breakfast every Friday that can range from

doughnuts and coffee to bagels and juice. In order to be in line with supporting a healthy

lifestyle, Motors and More would provide discounted gym memberships for employees

and their immediate family members. This will help create a healthy work environment

and encourage fitness and healthy living. As an incentive, Motors and More will offer

employees the option to purchase life insurance at a discounted rate afforded by the

organization. Merit increases will be awarded to each employee not heavily based on

their performance, but as a cost of living increase every year. This incentive will allow

employees to earn additional money, not tied to performance, making Motors and More

aggressive in their perks.

• Bonus – Offering bonuses to employees can create a motivated working environment as

employees with work to achieve the strategic goal of the organization. Employees are

driven to work harder and perform better if they know there is a cash payment after

accomplishing and meeting company-wide goals. Bonuses can also be an all-inclusive

paid vacation by the organization and not always consist of monetary payment (Nelson,

2010). By rewarding employees through high performing bonuses or other beneficial

perks, would allow a competitive advantage over other organizations as employees will


perform their best to achieve the end result. Motors and More will reward bonuses to

employees on an annually basis, which will be based on the employees’ performance and

how well they managed their time and productivity in achieving the goal of the company.

• Benefits – Benefits offered by employers is a strategy that can be used to attract and

retain employees. Employees rate benefits as a key factor in job satisfaction, employee

morale and retention (Meglich, 2011). Medical, dental and vision insurance is one of the

major benefits employees and potential employees seek after and look for an employer to

provide. Motors and More will offer basic health insurance in the organization will pay a

portion and the employee will be responsible for the remaining amount. Vacation and

sick pay will be offered to employees in a separate pool. Many organizations offer a

combination of vacation and sick pay in which many individuals resent because they do

not want to use their vacation time if they are sick. Motors and More will provide this

benefit separately, which can make Motors and More competitive when recruiting new

employees. In addition to (10) ten paid holidays, employees will receive (20) twenty

days of vacation pay and (5) five sick days. Manufacturer employees who are not

temporary employees will be offered (1) one week paid vacation in the summer and (1)

one week paid vacation in December which is included in their (20) twenty days as the

plant is closed during these times. Motors and More will offer employees a 401(k) plan

where the company will match 3% of what the employee contributes up to 10 (ten) year

and after 10 (ten) years, will match 5% of the employee’s contribution. This will ensure

longevity within the organization and help to reduce high turnovers. Short-Term

disability will be offered to all employees where employees will receive 50% of their pay

if they are employed with the company for less than 5 (five) years and 60% for

employees employed with the company for (5) five years or more. Offering these


attractive benefits, will hopefully allow Motors and More the competitive edge needed to

become first in the market area.

Other Rewards for strategic workforce alignment

Other rewards Motors and More can offer would include non-financial rewards that will

build job satisfaction, employee morale, create a diverse working environment, and career

growth and job advancement. These non-financial rewards could include awarding individuals

with working a half-day, raffling sporting/concert event tickets and dinner to area restaurants.

Work from home options will be available for non-manufacturer employees one day out of the

week to create work-life balance. Flexible scheduling offered to non-manufacture employees to

also support work-life balance as many individuals seek ways to balance their work-life and their

personal life. Flexible scheduling allows employees to balance their personal life with their

professional lives in order to care for themselves or their family (Nelson, 2010). All employees

will receive their birthday off to celebrate their day of life with family and friends along with

other creative perks to allow the company to stand out. These perks along with additional perks,

will put Motors and More in the forefront of attracting and retaining highly qualified and talented

employees.

Strategic Direction

Internal Equity

Internal Equity is based on employee job evaluation, where jobs are equal and equal

opportunity of individuals is applied between jobs (Meglich, 2011). Based on Adams Equity

Theory, internal equity focuses on how fairly employers are treating their employees and how

these employees perceive the treatment as employees compares their input (commitment, hard

worker, loyalty, trust in management etc.), and output (financial rewards, recognition,


advancement, job security etc.), with the input and output of others (Meglich, 2011). If

employees misinterpret the comparison of their job with that of their counterpart, internal equity

can be negatively affected. If employees perceive inequity they feel mistreated if they are not

fairly compensated, they are looked over for promotions or feel discriminated against. With

internal equity, employees can become unmotivated, resentful, disgruntle, dissatisfied, and

unhappy, which can all lead to high turnovers and reduce productivity. The best practice of

benefits is that Motors and More will need to focus on communicating each job description

through job evaluation to ensure there are no misunderstandings or perceptions based on an

employee’s compensation and treatment. Managers at Motors and More must be able to evaluate

jobs and explain the compensation in an effective manner. Communication is essential in any

organization as each job evaluations and job positions/descriptions should be transparent in order

to create a healthy work environment that involves fair compensation whether it is pay or

promotions. Motors and More poses a threat to their organizational growth as the company

currently have one woman who is a supervisor and no other minorities in high paying jobs. The

company will need to reevaluate its current structure and engage in building a team of all types

of individuals. This will allow Motors and More to become closer to their goal of becoming first

in their market. Without making these types of changes, Motors and More risk the inability to

grow, become profitable and left behind as their competitors advance in the market area.

Market Competitiveness

Motors and More will need to be competitive in order to increase their output by 96% and

to become first to market. In order to be competitive, Motors and More will need to increase

diversity by hiring more females in management and in all areas of the organization as well as

hire minorities. Hiring different groups of individuals allows the company to attract a wide

range of potential qualified and talented employees to move the company in the right direction.


Motors and More will provide training on updated technology, equipment and services to stay in

the mix of operating with the best and most efficient equipment and procedures to produce a

team of talented and qualified workers. Motors and More will compensate employees

competitively by offering slightly more wages than their competitors Cumming, Inc. and Delphi

Corp (Meglich, 2011). By offering more for compensation, Motors and More will have the

opportunity to attract highly qualified and talented employees in their selection process and

retain currently skilled employees. Recruiters will build face-to-face relationships in attracting

candidates and communicating the benefits of working at Motors and More. Face-to-face

relationships will allow recruiters to have one-on-one interaction with potential candidates

during the preliminary screenings before the recruiting process begins. Job vacancies should be

posted internally to all current employees for an opportunity to grow and advance within the

company. By offering this measure, Motors and More create loyalty, commitment and a team

who will go above and beyond to ensure the strategic and organizational goals are met. Motors

and More will also hire temporary employees in its manufacturing department to increase

production and meet product demand. If the temporary employee can handle meeting the

expectation of the job demands, the temporary employee will become a full-time employee

within (3) three months of their temporary assignment and have access to all benefits Motors and

More employees enjoys. This will allow temporary workers who have learned and mastered the

job an opportunity to join the growing company.

Individual Rewards’ Distribution and their alignment to Performance Management

Individual performance should be linked with organizational goals to determine the

employee’s contributions and success in their position (McPhie, 2006). Individual rewards can

have a great impact on employees. These types of rewards such as employee recognition,

employee rewards, and employee praise all provide a sense of accomplishment, acceptance and


security to employees. Motors and More can establish a newsletter where employees are

individually recognized for their accomplishments. These newsletters would be available not

only internally, but externally as well to show we are proud of our employees and value their

loyalty and commitment to the company. Employees of the month can also be individually

recognized by rewarding these employees upfront parking with a sign to read “Employee of the

Month.” The employee of the month for manufacturers will be based on their productivity and

for non-manufacturer works will be based on their level of going above and beyond to ensure the

company is meeting its goals and customers are satisfied. Another way to recognize exceptional

employees is to allow those employees work on special projects creating a sense of importance

and value to the employee. Employees feel valued as it creates job satisfaction, motivation and a

positive working environment (Meglich, 2011). Allowing employees to work on special projects

also creates the opportunity for the employee to learn other tasks and can possibly lead to

internal promotions. At the end of the year, Motors and More will acknowledge employees of

the year by having a luncheon and small gifts to show the company’s appreciation to those

individuals. Individual rewarding and recognition builds confidence in individuals and causes

the employee to work harder and strive for success in meeting their goal as well as the

organization’s goals.

Compensation Strategies that may enhance the Total Reward Strategy

Pay for Performance

When implementing the pay-for-performance program, the organization must clearly

communicate and explain the expectations, how to accomplish the expectations successfully, and

what is involved in the pay-for-performance appraisal system (Heneman, 2007). Managers will

successfully be trained on how to properly administer the pay-for-performance benefit as well as

train, lead and coach employees on how appraisal system works and how to achieve a successful


appraisal (Heneman, 2007). It is important that employees be able to trust their managers and/or

supervisors in order to have a successful pay-for-performance program (Sammer, 2011). Motors

and More Inc. will use a Merit Grid (table 1.5) that is cost effective and has range control. The

Merit Grid will be based on Performance Ratings to include exceptional, above average, meet

standards, needs improvement and not meeting standards. Motors and More will ensure the

company is practicing fairness based on employees meeting the organizational goals.

Manufacturer and Sales employees will receive pay for their performance as their performance

generally effects the financial and productive growth of the company. Sales employees will

receive a commission on top of their base salary for every sale the employee closes. The

commission will be a percentage of the sale, depending on the sale of the item. Manufacturers

pay-for-performance will be based on the how effective and efficient they operate while on the

floor. The performance program will be based on the number of output production the

manufacturer produces and how the manufacturer accomplished that output without incident.

Non-sales employees will receive a pay-for-performance increase according to an appraisal

system. The appraisal system will evaluate employee’s performances, how they accomplished

each goal and any improvements if necessary. By adhering to all rules and following all

procedural elements, pay-for-performance can be successful and widely accepted within an

organization.

Broadbanding

Broadbanding is based on large pay ranges and has a maximum approximately 40%

above the minimum (Heneman, 2007). When organizations decide to implement broadbanding,

the organization may want to support a new culture. Motors and More may want to consider this

approach as the company will add minorities and various ethnicities to the organization. In order

for Motors and More to grow, broadbanding will allow the organization to be flexible and push


toward supporting career development for all types of employees. Broadbanding also allows an

organization to have flexibility in assigning compensation pay to job positions based on

performance management. Broadbanding can be successful by reducing turnover and increase

productivity if implemented correctly. Managers will have to develop a strategic plan in

determining how to successfully support a growing organization.

Group Incentives

In group incentives setting organizations pay cash or issue stocks for performance by

measuring the employees who work as a team in a team environment (Heneman, 2007). Group

incentives encourage team work and provide employees the opportunity to work collaboratively

to accomplish the end result. Group Incentives will be awarded for the entire workforce if the

organization meets its organizational and strategic goals. Each employee will be rewarded for

meeting and accomplishing the organization’s business goals. Gainsharing is part of group

incentives and is rewarded through compensation. Gainsharing allows organizations to reward

employees for cost reduction and improving productivity to help employees understand what is

important to the organization by working together to obtain the common goal equally (McCain,

2007). By rewarding each employee, it creates a work environment that has high morale,

increased job satisfaction, low turnover, and high productivity.

Training and Learning Strategy

Training is important for an organization as it allows their employees to be versatile and

perform competitively with other organizations in the market (Garvan et al, 2006). Training is

another way of investing in the talent an organization has. Training can show employees that

they are valued and that the company is invested in helping with career and developmental

growth. Investing in Motors and More employees should be visible in employee’s productivity


and attitude towards their duties which in turn will lower the turnover rate and increase employee

morale (Chiang et al; 2005).

Training Needs Assessment

Shepherding a training needs assessment will provide an organization with a tailored

assessment of what the organization is lacking and how to best correct those areas. The

assessment should be conducted so the organization can obtain the right tools and training

methods to ensue training is effective, efficient and corrects any issues the organization may be

experiencing (McArdle, 1998). A need assessment is far reaching in the information that it is

able to produce for HR to implement the correct training. If done correctly it is very effective as

the assessment will show deficiencies in performance, employee’s competency levels, identify

the causes of particular problems and make identifying the solution less tedious (Rossett, 1987).

Needs Assessment

A needs assessment will be conducted to assess the need for training at Motors and More

Inc. The needs assessment in its entirety will employ both questionnaires and interviews to fully

understand the training needs of Motors and More employees. This understanding will allow

Motors and More to better serve its customers as well as the organization as a whole.

Questionnaires will be used to identify the tasks, skills and behaviors that employees will need in

order to be successful. According to Noe, (2010), a questionnaire is a research tool that is used to

garner information. This research tool is low cost and is able to provide information from a large

number of individuals’ simultaneously. An interview is a more hands on tool that is used in

extracting information and details about training needs as well as causes and solutions to


problems. Using both methods can allow Motors and More to obtain a more accurate assessment

of its training needs and lack thereof.

Motors and More Inc. is a thriving business-to-business company that specializes in

manufacturing small motors and accessories for industrial and home products (Don McCain,

Ed.D. Motors and More Inc. - A Progressive HR Case Study, 2007). Motors and More training

needs will be specific and should be evaluated and updated as often as possible. The training

strategy Motors and More will implement is crucial in order for the company to grow at the rate

that management is projecting. The strategy will need to remain current so that Motors and More

can compete against industry competitors regarding the latest technology techniques and

methodologies used.

The needs assessment focuses on three different areas to determine what training

necessities exist and who needs to be trained; the three different areas in the needs assessment

are Organization Analysis, Task Analysis, and Person Analysis.

The Organizational Analysis examines the environment, strategies, and resources Motors

and More Inc. possesses, assisting in the determination of what training should emphasize.

Organizational analysis sifts through the organization compiling information on what areas in the

organization training is needed, the skills and knowledge employees have to possess in order for

training to be effective and also looking into the environment that training will be

conducted(Brown, 2002, p. 572). When examining Motors and More there are two key factors

that need to be assessed to help determine where training emphasis needs to be placed. The two

key factors are; the size of the department(s) and how busy the departments remain. These are

crucial environmental factors that will greatly impact the training needs of the organization.

Department size and how busy a department is, will determine the amount of employees and

define operational key factors such as design and resources.


The Task Analysis is HR looking at job descriptions to see the specific skills, knowledge

and abilities that are needs to perform the different jobs within the organization (Miller &

Osinski, 1996). After the task analysis has been conducted what will be an indication for the

need for training are the gaps and unanswered questions that the analysis produces. Motors and

More will use a variation of tools to collect the task analysis data such as; job descriptions, on-

site observation and questioning, job safety analyses, analyses on the hazardous level of the job,

performance standards, and review of best practices based on the competitors in the industry

(Miller & Osinski, 1996).

The person analysis is the determination of the specific individuals who are in need of

training. It identifies if an employee has the necessary individual to absorb the training material

that will be presented in training and the ability to apply what was learned in their everyday work

duties (Noe, 2010). Identifying issues in an employee’s performance comes out of looking into

the employees work environment and work history which will include looking at productivity,

and the equipment they work with daily (Miller & Osinski, 1996). By evaluating these areas,

Motors and More can actively begin making changes to ensure employees have what they need

to perform the job duties correctly.

Need Assessment Methods

Motors and More will employ the following methods to assess the need for training:

• Compare the practices of the organization to that of the industry.

• By submitting a questionnaire to all employees, managers and supervisory staff.

The questionnaire essentially is going to help us gather the necessary information to plan and

implement customized training derived from information assessing from employees current

knowledge and skill sets. The data collected will identify the areas that need improvement, and

allow training personnel to develop training content and provide direction the training needs to


take. The Training Development Manager and Training Facilitators of Motors and More we will

be able use the assessment information gathered to assess the brand expectations, desire

outcome, and available resources for training.

To understand the effectiveness of the training program that has been implemented there

has to be an evaluation of the training quality, course design and learning experience (Tansky

and Cohen, 2001). These methods of assessment will allow us to address training for new and

current managers as well as supervisors at Motors and More. It will help the human resources

department decide how to approach orientation programs for new employees, the refresher

course training for current employees, and management skills training for managers and

supervisory positions.

The organization will need to have an orientation program for incoming employees. This

orientation indoctrination process will give employees information about the industry,

organization, job or position. The orientation process helps to retain employees and gives them a

chance to become integrated into the company before they take their actual position in the

company. The orientation also gives HR a chance to ensure they understand the organization, the

procedures and expectations before they start their required job tasks. Current employees will

also need refresher courses in skills and diversity training to keep them current. The organization

and human resources managers will need to evaluate whether bilingual training would support

the workforce (Don McCain, Ed.D. Motors and More Inc. - A Progressive HR Case Study, 2007)

With Motors and More growing, the organization will constantly be adding team leaders;

hence recurring leadership training will be necessary. Motors and More had a system in place

where management personnel were promoted on the basis of seniority, with this kind of system it

means that there is no guarantee that Motors and More senior management possess any

management level training. This could pose a problem for Motors and More, as employees may


recognize the lack of skills and training in managers and may begin to resent them, their job or

both, causing an increase in turnovers. Basic leadership training in areas of budgeting,

forecasting, employment laws, performance evaluation, goal setting and 360 feedback would

improve the employee’s capabilities, job satisfaction, and morale, thus reducing turnover rates.

Promotion by seniority also resulted in a lack of women and minorities in top-level positions,

indicating the need for diversity training. Diversity training is also recommended for all groups

(Don McCain, Ed.D. Motors and More Inc. - A Progressive HR Case Study, 2007). Employers

must place importance on these factors in order to make their employees satisfied and retain

qualified and skilled employees. Providing proper orientation prior to the employees becoming a

part of the company, the community and partaking in adding to the value and understanding the

nature of the organization's products and services provided to the target community defiantly will

lead to better employees commitment to the job; hence contribute to the organization

productivity (Ahmad, 2012).

Training Content Development

HR will have two choices of how to obtain their training content. They can either develop

the training content or purchase it. In developing content internally we will accomplish this by

using SME’s (subject matter experts). Purchasing training programs that have already been

developed rather than having one customized is an option. Conversely, such standardized off-

the-shelf training programs are not customized by vendors for individual organizations and

therefore the cost of customization must be considered. In addition, organizations will have to

account for the cost, time to delivery and size of workforce to target are also factors to consider

when determining the training content and how it will be developed or obtained.

Evaluation Tools to Measure Training Success


The best-known and most widely-used model for the evaluation of the effectiveness of

training programs is the model of four levels of Kirkpatrick. According to Kirkpatrick, the

evaluation of training programs should be made attending to the following four questions:

(1) What is the reaction of participants? Do they appraise training? (2) What is learnt? Do

participants improve competencies (skills and knowledge) with the training program? (3) What

are the effects on performance? Do participants change (improve) their behaviors and job

performance? (4) What are the effects on productivity? Do changes of behavior and performance

produce economic returns? (Iglesias and Salgado, 2012)

Kirkpatrick’s four levels of evaluation model:

Level 1: Reaction

Reaction has to do with acquiring information from the employee’s about what their

thought of the training they received. Therefore we want to get information such as what they

thought of the program , what they thought about environment the trainer was held in, trainer’s

and the information. This particular information will be assessed through questionnaires which

the employees will answer. The questionnaire will specifically asked questions focused on how

satisfied the trainee was with the training. Measuring the trainees reaction to the training is

important because it will help bring a comprehensive understanding of the areas that were missed

and those that need to be implemented to satisfy the trainees needs and satisfaction. (Kirkpatrick,

1994)

Level 2: Measure learning

The measuring of the learning stage is accessing trainees familiarity of the elements

(principles, techniques, procedures) present in the training program. This information is gained

through tests (pre and post) and assessments. This information as to what the learning occurred


from the training is important to HR as it will assist in planning future training (Kirkpatrick,

1994).

Level 3: Assess behavior change on the job

This is where you assess the change in skills and performance of the job after training has

been done to attain how effective the program was. Assessing information such as whether or not

employees have been using the newly learnt skills on the job and how much of the new skills

have they applied to their daily routine on the job. This assessment will shed light on many

issues for HR such as if the work environment is conducive to learning and the transfer of that

learning on to the job site (Kirkpatrick, 1994).

Level 4: Measure results

The last level of this evaluation is how assessing how a training program has affected the

company, how has the company benefitted from the implementation of this training program.

This is where you look at the elements that may have been directly related to the kind of training

that trainees underwent. Therefore we may look at productivity level, product quality, employee

turnover, and accidents after training has been performed. Assessing to what extent these

elements have changed and how much, looking at the numbers and percentages involved

(Kirkpatrick, 1994).

Training Modalities

To successfully complete training activities an individual will require a broad range of

skills, knowledge and abilities. For example, Nair, Czaja, and Sharit (2007) examined the

differences between individuals who had performed a computer based task where the results

showed that age and intelligence impacted their level of performance and how their performance

changed after training experience and practice. Everyone in the company will be a part of the

training process to ensure all individuals understand the strategic and organizational goals of the


organization. Their needs will be different and will have to be approached with those differences

in mind. Therefore when constructing training we have to remember that the ages and levels of

competency among them will be different and will need to be addressed with that frame of mind.

Therefore careful consideration will have to be taken in the approach to training our older

workers.

This consideration of our older staff is not by any means a separation between young and

old. All employees will have access to the same skill training as we need them all to be on the

same level, but we must ensure we carefully look into how best to make instill the transferring of

information. Many cognitive abilities decline with age. These important learning abilities show a

decline with age in relation to conditions under which tasks are performed and a task is fairly

new to the individual (Park, Lautenschlager, Hedden, Davidson, & Smith, 2002). However the

research does show that even though age affects the ability of our aged staff they still possess the

ability and motivation to learn and acquire new skills (Charness & Czaja, 2005).

Many research studies have been conducted on what effect the organizational factors can

have on training transfer but only a few have taken into consideration the effect that the different

training delivery methods can have on training transfer (Journal of Technology Studies.

Winter2007, Vol. 33 Issue 1, p48-56. 9p). When designing the training program we must

consider the appropriate training setting or environment. Training settings include:

• simulator;

• on-the-job training;

• classroom;

Simulations

The use of simulation to train individuals has become prominent in the business world. In

its inception it was more popularly linked to the training of aviation personnel, but over the years


has become so popular that this method f training has become open to more industries

(Perfusion. Jan2010, Vol. 25 Issue 1, p17-20. 4p).The training program for the Motors and More

Inc. employees will be done in the form of simulations. Simulations represent real life situations

where the decisions made by the trainees will mirror the ones they will make on the job.

Simulations will be a good way to present the training as it almost give the employees a kind of

hands on approach and they will enjoy it since it is related to a video game and most of the

employees are of a young age. The simulation will be available to the employees to take on

designated times just to ensure that they all do the training in a certain time slot. Even though the

time is designated it will not be rigid so as to take away from their time at work or otherwise.

The simulation will be both technical and based on theory so we can cover all levels of

information being given to them.

OJT (On-the-Job Training)

On-the-Job training (OJT) is a process in which new or inexperienced employees receive

training under instruction by qualified employees performing the same job. OJT is an affective

training tool that allows for experienced employees to develop leadership and training skills

while at the same time inexperienced employees receive new skill sets on processes and

technology that are introduced into the company. OJT provides the widest dissemination for

across training of employees across units and departments. The following are applications of

OJT;

• apprenticeship training

• self-directed training programs

• peer-to-peer training modules


OJT has the best attractiveness for organizations because of its low cost, low turnover rate and

increased job satisfaction. Unstructured OJT can have disadvantages but structured OJT will

have positive impact as long as it is not too informal (Noe, 2010).

Classroom

Classroom training is the most traditional form of instruction training there is. This

setting allows trainees to grasp the theoretical aspect of their job in a setting that provides them

room to ask questions and receive the proper answers from their instructors based on experience.

There are no meaningful learning differences between online training and that of the classroom.

However, the classroom does have the capacity of higher motivation and positive feelings

concerning their instruction than online training. Of the main methods for delivering instruction

and training, classroom instruction (i.e., instructor led), is still the most common (Salomon Smith

Barney, 1997).

Costs of the Modalities

Cost benefit analysis is used to determine how economically beneficial a training

program will be to an organization by determining the training cost and benefits. Training cost

information is important for several reasons;

1. it assesses direct and indirect cost needed for training

2. compares different programs to find the most economical one

3. to evaluate the training budget, making sure money is being spent on the right thing

4. to control the budget (Noe, Hollenbeck, Gerhart, Wright, 2010).

The cost of modalities will determine whether it is economically wise to choose a certain kind of

training method if the cost does not measure up to the return on investment. Some elements to

look at when assessing the training cost of a method are;

• Cost of Trainer


• Cost of Training Material

• Cost of wages paid during training

• Cost of lost opportunities

• Total cost

• Return of Investment (ROI)

Motors and More will be looking into using simulations, OJT and classroom as their methods of

training. In terms of cost the use of simulation has been limited by it development costs. The

development costs of simulations are expected to decrease which will make it a more popular

training method. The costs of simulation varies; a customized simulation can cost between

$200,000 and $300,000 while a simulation purchased from a supplier without any customization

costs $100 to $200 per trainee. (Noe, Hollenbeck, Gerhart, Wright, 2010).

The Cost for OJT

In order to estimate on-the-job training costs it was determined that the following four

basic questions needed to be answered: (1) what is the Journeyman level; (2) what is the rate of

learning; (3) how much time is spent by the supervisor; and (4) what are the cost elements

involved? On-the-job training can be considered an "investment" in that there is a cost involved

in this type of training, just as there is in school training. The Training Devices Center study goes

on to say: "A number of attempts to derive a rational comparative cost for shipboard OJT were

unsuccessful. The essential problem lies in the fact that the ship, while training, is also a member

of the operating forces and its time at sea cannot be attributed to training alone. A satisfactory

means of pro-rating ship operating costs among operators, or periods of time, or nature of

activity, could not be found". OJT varies from task to task in the amount of time required for

such training. Therefore, in lieu of dollar cost information, tasks were compared on the basis of

time required to achieve a given level of performance via OJT (Jacob Mincer, 1962 pp. 50-79).


Cost Elements

The cost elements to be considered for costing on-the-job training can be varied and large

in number. However, with the inclusion of each cost element the problem of costing becomes

more complex because of the concurrent increase in the number of input sources, mathematical

computations, etc. The cost elements which appear to have the greatest bearing on the cost of

OJT are;

a. Trainee's pay and allowances

b. Supervisor's pay and allowances

c. Spare parts wastage (Jacob Mincer, 1962 pp. 50-79).

The cost for classroom training

The cost of a technology-based training program seems higher when it is being compared

side-by-side with the cost of the traditional classroom style of training, but the significance

savings in the delivery of training offset the high cost of design and development. The Learning

Technologies produced by the American Society for Training and Development offer some rules

to use in evaluating the costs of traditional classroom training;

• Traditional Classroom Training - Assume 40 hours of development time for one hour

of instruction. Using $50/hour to capture the hourly costs (salary & travel), a typical 36-

hour training event in NRCS would costs $72,000 to develop (Training Costs, June 8,

2013).

Succession Planning

An effective succession plan will guide Motors and More Inc. in creating a roadmap for

success. It also has the ability to attract and motivate successful employees. HR will make a

commitment to creating and implementing effective succession plans that will embrace a

comprehensive program for the transfer of management responsibility and other lower level


positions, so Motors and More can experience the rewards of lasting legacies and growth for the

business. An effective succession plan is like an emergency plan it will literally save the

organization’s life.

The most important thing that a leader can do is to make sure that they have plans in

place for their own succession. For the organization and the employee succession planning is

one of the most important business decisions made as it prepares them both for what they have to

look forward to and gives them an eye into the future which in business is always a plus.

Distinguished economist Clifton R. Wharton Jr. noted that a leader greatest failure is failing to

prepare or mentor their successors (Jim Henderson, 2007). The concept of succession planning is

the organizations systematic effort to ensure that key positions within the organization are

continued. Motors and More would need to invest in a succession planning program because it

will help the company grow and develop at the rate they are projecting. Succession Planning at

Motors and More Inc. will provide opportunities for workers with increased potential allow them

easy access to replacements and will keep their turnover rate at a minimum.

Succession planning is an effective systematic effort, deliberately planned and driven by

an organization business strategy (Rothwell, 2001, p. 23). The basic elements of a succession

planning process are that it:

• Communicates employees career paths

• Establishes the organizations development and training plans

• Communicates upward and lateral movements in organization

• Creates a more comprehensive human resources planning system (Rothwell, 2001, p. 9)

Motors and More Inc. will use software or Web based solution to ensure the success of

the succession planning systems. This system will be purchased by the company instead of

having one customized. Motors and More is looking at a staff of 500 hundred therefore we will


need a system that will effectively allow HR to evaluate and sift through those who are eligible

for positions that need a successor at any one time. The software or web based system will allow

Motors and More to manage the large amount of data regarding positions requirements and the

potential of the employees for succession. This software will also allow the employees of Motors

and More to get involved with their succession planning by them having the responsibility of

updating their educational and experience information. With software like this HR will be able to

quickly go through and view the information on performance, accomplishments, career goals,

whether or not there is a successor for a position and develop succession plans for individual

employees.

Performance Management

Performance Management is an essential process for any organization and Motors and

More is no different. Performance management is the process by which employees, mangers and

Motors and More as a company is evaluated. It involves continuous data collection to ascertain

whether or not the desired outcomes are being achieved (US department of Health and Human

Services, 2013). The purpose of this evaluation is to determine if the company’s goals are being

met, how each employee is actually performing against their peers and their overall output. It

serves as a link that measures the company’s success in relation to the company’s strategic

vision. Performance management also serves as a tool used to identify the strengths and

weaknesses of employees and managers as well as the short comings of the company as a whole.

A successful performance management evaluation helps to motivate employees and gives

feedback. Feedback is important because it gives an employee an idea of where they stand with

in their organization and how their overall performance is assessed. High employee evaluation

scores are connected to employee promotion, department transfers, pay increases, and other non-

monetary rewards. Low evaluation scores are linked to employee counseling, training and or


termination. The performance management process needs to be accurate and respected and the

criteria to be measured needs to be clear and explained to every employee. Full disclosure of

what will be evaluated will allow the employee to work diligently in these areas to achieve the

best evaluation possible (Schermerhorn, 2011).

Criteria for Measurement

Motors and More’s strategic goal is to become a major player in the small motors and

accessories business to business sales. Their goal is to raise production output levels by 96% and

the criteria used to evaluate employees will surround the efforts per employee to help Motors and

More achieve this goal. Criteria used as performance measures are an integral part of the

performance management system and allow for important strategic decisions to be made based

on the results. Employees will be evaluated individually as well as in terms of how well they

work with in a team. Criteria for employee performance, for example, will be weighted on

meeting and exceeding their daily quota, the time it takes an employee per shift to complete their

quota, the quality of their output and how many defects per shift per output. Output measures are

necessary in determining an employee’s speed and efficiency. Speed and efficiency, within a

manufacturing industry is a vital component for success and will hold 50% of an employee’s

score. Other criteria to be measured are aligned with Motors and More’s vision of being more

diverse and increasing employee retention. A positive work environment is a key element in

employee retention. As such, other criteria for measurement will score an employee’s

willingness to be a team player. Activity measures are important as they help measure an

employee’s work effort. These will include, an employee’s attendance record, how many times

an employee has been late or called out without enough advance notice, their attitude towards

their team members and their willingness to go beyond their job description. These measures will

be used to calculate 50% of the employee’s score. When combined with the individual


component of evaluation the maximum score to be earned by an employee will be 100%. An

employee needs to hold a combined score of: 75% - 85% to meet the company’s expectation and

85% and above to exceed expectations. Scores between 50% -75% categorizes an employee as

marginal and scores below 50% positions an employee in the does not meet category.

Appraisal Methods

To evaluate these measures Motors and More will employ a combination of methods to

produce the most valid and reliable evaluation of their employees. To measure the employee as

an individual, Motors and More will use appraisals by job results for the temporary

manufacturing employees and the Management by objectives for the permanent manufacturing

employees and other regular staff members. For the team based criteria, Motors and More will

utilize the Graphic rating scale. Employee appraisal systems need to be objective. Appraisals

should not be based on the feelings of the manager or supervisor. It must be based on job specific

objectives that can be judged and quantified. Measures must be easily explained leading to

results that can be defendable. Evaluations need to include feedback that can be used to motivate

employees, with both rewards for high scores and penalties for poor scores (English, 1991).

The results approach used when evaluating employees is relatively simple. For the

temporary staff, we will only use the results appraisal methodology, and they will be judged on

their ability to meet and exceed, to meet or to don’t meet their work objectives. Quantifiable data

will be collected and used to evaluate the employee based on their specific job requirements

(www.exploringhr.com, 2013). All employees were given a job description and objectives at the

time of hire, which they are required to meet to successfully complete the job. If the temporary

staff meet or exceed these objectives then their contract with the staffing agency will be renewed.

Temporary staff members that do not meet or exceed their given objectives will be replaced by

more qualified workers. Permanent employees and managerial staff are assessed for the


individual section of the appraisal process by using the Management by Objectives method

(MBO). This method surrounds the meeting of specified objectives as does the results method,

however, it takes the process one step further. The MBO method identifies the criteria or

objectives used to measure performance, allowing the measures to be set by the employee and

their supervisor. The supervisor and the employee explore the employee’s career goals or work

goals for the year and identify these objectives as things needed for the employee to achieve their

goal successfully. This type of appraisal method fosters communication between the employee

and their manager, it increases feedback and it reduces conflicts that may ensue because of poor

performance scores. This method strives to motivate the employee to succeed at the goals that

they want to achieve, a stepping stone to promotion or more efficiency in their job (Sims, 2002).

Evaluation of all employees based on their team work will be appraised using a member

of the Absolute Approach. Using the Graphic rating scale is simple and very cost effective. It is

used to evaluate behavioral attributes deemed important to an organization. The appraisal

method seeks to place a value or a rank to specific behaviors identified and displayed by an

employee and ranks them based on a 5 point scale. These values are then calculated by averaging

an employee’s score. This method is very general and easy to use, very easy to revise and not

very time consuming, which will work well for a manufacturing plant such as Motors and More.

All employees, even the temporary employees can be ranked using this method (Table 1.6).

Other methods of appraisal, such as, Critical Incident diaries, Behaviorally Anchored

Rating scales, Ranking based on Forced distribution are either too intensive, impractical for a

manufacturing plant such as Motor’s and More or they are to basic. For a company that strives to

have between 200-300 employees ranking employees by comparing them to one another or from

the best to the worse can be very time consuming and highly subjective and unreliable.

Feedback


Performance appraisals can either be formal or informal and are usually conducted by

someone who has a thorough understanding of the job and its objectives, either a manager or an

immediate supervisor. Motors and More will conduct one formal employee performance

evaluation per year and 1 informal performance communication meeting for all permanent

employees. Motors and More’s year will be divided into a six month period, with the informal

communication completed once every 6 months and the final evaluation at the end of the year.

This will allow an employee to implement all feedback received to ensure that they achieve a

meets or exceeds company expectation. Temporary employees will be evaluated 75 days post-

employment to determine if they are suited for Motors and More as a permanent employee. In

addition to the informal and formal meetings managers will be asked to print out employee

performance sheets based on their performance within a 3 month period to be distributed to their

team. These statistics are informative only and can be discussed per employee request.

Feedback is a necessary process of any performance evaluation system and it is a main

component in performance management. Without feedback it is impossible for an employee to

improve and work in alignment with the strategic goals of the organization. One can say

feedback is a ‘necessary evil’ as giving feedback can be somewhat uncomfortable for both

managers and employees. Having someone judge and evaluate another’s performance can be

difficult, especially if the feedback is not all positive. All employees have different strengths and

weaknesses but not everyone is aware of what they are. To alleviate this problem, feedback

should ideally be given continuously. However, when managing a large manufacturing plant, this

may not be practical. Therefore Motors and More have broken down the evaluation process as

discussed above. The purpose of giving feedback at specific intervals throughout the year is to

ensure that the employee is not surprised by the evaluation process and how they are scored

(Noe, 2008).


During the informal performance communication meeting, the employee will be asked to

discuss the areas in which they believe they are exceeding in and areas where they need training.

Their performance per results and objectives will be discussed and a dialogue will be

encouraged. These informal meetings will be used primarily to let the employee know what is

being observed as well as to develop a plan to either continue meeting the expected goals or how

to get on the right path. Everything discussed will be documented and the employee will be

given their scorecard.

When giving feedback the evaluator should choose a location that is of neutral ground to

reduce the employee’s level of anxiety and the role of an employee’s coach should be adopted.

Appraisal meetings need must be problem solving in nature and less telling and selling or telling

and listening. Problem solving appraisal meetings encourage the employee to be involved in their

evaluation. The employee becomes more vested in their own development and it serves as a

motivational factor and fosters increased behavioral changes. Problem solving appraisals also

help the manager giving remain in the coach role and to be the employee’s biggest advocate.

To ensure that Motors and More delivers feedback in the most motivational way, an

appraisal strategy has been developed. All employees must complete a self-assessment prior to

any formal performance evaluations. This encourages the employee to evaluate their own

performance and it will increase awareness and dialogue about an employee’s performance. The

employee is asked to think of any areas that they believe they need more training and

development in. This encourages an employee to own their problem. Conflicts may be reduced

as the employee is the one pointing out their developmental area. Both the manager and the

employee must work together to develop a strategy to aid in the developmental areas. Specific

goals need to be set and specific dates need to be scheduled to evaluate the employee’s success

or need for more training in these areas. Managers need to keep the appraisal positive and the


employee should be praised for their achievements. Criticism should be kept at a minimum. In

addition, managers need to focus their evaluations on the results and not the person. Managers

should never attack an employee’s worth as a person. All employees must to be given an avenue

to discuss any issues that occur because of an appraisal. In particular if an employee believes that

they have been judged inaccurately, unfairly or believe that they have been disrespected.

Employees need to be educated about Motors and More’s employee website and given the link

needed to send in a formal complaint about their performance appraisal and finally, all employee

rewards based on their performance evaluation should be discussed and offered (Kulik, 2004).

Rewards

Employees will be rewarded for their efforts and their scored results based on their

performance evaluations. Employee’s must score within the Meets and/ or Meets and exceeds

categories in order to benefit from Motors and More’s reward programs. Motors and More

reward program consist of merit pay or bonuses, a day off with pay and employee recognition.

All Employees that meet and exceed the expectations through their evaluations will be publicly

recognized in Motors and More’s Newsletter. Employees will be honored both internally and

externally as the Newsletter will be available for viewing on the employee and company’s

website. This reward is a non-financial reward but can bring great pride to an employee as he can

show his friends and family his accomplishments. Employee praise motivates employees to

continuously improve performance (Miller, 2012). All other rewards will be broken down per

performance category. As stated above, for an employee to categorized as a meets employee they

must score a combined percentage between 75% -85%. These employees will be rewarded using

the pay per performance system or as some may call it merit pay. Merit pay can be defined as the

system a company uses to increase an employee’s salary based on their individual performance

(US Department of Labor, 2013). This reward will consist of raising the employee’s base pay by


3%. This benefit will be realized per pay period as the increase is distributed evenly throughout

the year. Employees who meet the expected objectives will also be entitled to an additional four

hours of personal time to be used at the employee’s discretion. Sales and other non-

manufacturing employees who work on commission will receive a $250.00 bonus at the end of

the year.

Employees that Meet and exceed the expectation, they will be rewarded with a 5%

increase in their base salary as Merit pay and they will receive a full day off with pay. Sales and

other non-manufacturing employees who work on commission, a will be given $500.00 bonus at

the end of the year. Employees who need further development such as those who scored 74%

and lower will be enrolled in Motors and Mores developmental program. There are many

different reasons that may affect an employee’s performance and it is the duty of the manager to

analyze these reasons and collaborate with the employee to create an improvement plan. The

goal is to motivate the employee with additional training and adequate resources to ensure that

the employee has all the necessary tools and for success.

The employee will be placed on a probation period of three months in which the areas

that need addressing should be approved. Employees who need additional training will be

enrolled in training programs and will be assigned a mentor. The mentor will be available to help

the employee as needed and per request. Mentors can be an employee’s peer who scored in the

Meets and exceeds category or an immediate supervisor. Employees enrolled in these programs

will be given the utmost discretion. The details of their personalized development plan will only

be shared to mentors and direct supervisors. The purpose of the developmental program is to

improve and develop employees and not to embarrass or create a hostile work environment.

Upon successful completion of the probation period the employee will be in a position to score in

the meets and or the meets and exceeds categories. This program is designed to transition an


employee from being a does not meet and marginal to meets and or exceeds employee.

Employees whose performance does not improve with in this probation period will be

terminated.

Strategic Alignment

Performance management evaluation for Motors and More is vital for their success in

achieving their strategic mission and plan. For Motors and More to become a leader in the

industry, focus needs to be placed on their competitive advantage. Motors and More’s main

competitive advantage and strategic plan lies in the quality of their employees. Motors and More

strives to diversify their work force and hire the best staff possible from nearby colleges and

other well qualified manufacture workers. The strategic rewards program developed by Motors

and More will motivate their employees, which is one of the most effective ways of producing

optimum results from employees. Rewarding employees for their hard work shows the employee

they are appreciated but mostly what is in it for them, which in turn boast productivity. Motors

and More will be better equipped to make employee financial and compensation and accurate

promotion and employee transfer decisions. (Lefton, 1978).

In short conducting performance management evaluation is a main component in the

strategic plan of Motors and Mores, to ensure that they are propelled to the next level and

become one of the leaders in the small motors and accessories business to business sales.

Human Resources Information System

In order for Motors and More to align and integrate a Human Resources Department that

provides capability, accountability, and flexibility to meet the demands of the business strategy.

The organization will require a sophisticated data collection system that is accessible to all


employees, compatible with existing systems, flexible and expandable to the organizations

changing environment. Thus, it is paramount that the organization establishes an effective

Human Resources Information System (HRIS) that meets these requirements.

The role of an HRIS is to allow for HR to implement its strategy (in relation to the

business strategy of the organization) by utilizing information systems for strategic decision

making along, with the use of a wide range of application available and ease-of-use capabilities

for both line managers and senior leadership to have direct access to personnel information

required for management (Armstrong, 2006). The use of an HRIS will give benefits to an

organization by:

• Increased accessibility to Human Resources Information.

• Create standardization and streamline process across organizations.

• Maintain current and historical data.

• A higher internal profile for Human Resources (Armstrong, 2006).

The primary purpose for this type of Information System (IS) is to provide strategic

decision making by compiling and analyzing data on personnel from the organization’s (both

macro/micro) perspective to make informed decisions on the utilization of human resources,

employee development and organizational health (Armstrong, 2006). For Motors and More to

implement its strategic plan, the implementation of a HRIS will be necessary to:

Maintain employee history (training, education, and performance), Tracking daily

transactions (time & attendance, leave, sick time). Meet local and federal government regulatory

requirements (Wages, Salaries and other compensatory benefits) and conduct workforce

analytics to review internal heath and organizational performance workforce diversity, and

organizational mix) (Bhavsar, 2011).


As stated earlier in the Section of Workforce Strategy, Motors and More with no existing

HR department needed to address key issues in relation to roles and responsibilities, external

environmental pressures, and unrealistic goal setting. Thus, it is vital that specific key areas to

develop a successful and sustainable HR department that will meet the needs of the

organization’s global expansion. It is of great importance that Motors and More create a

department to meet these objectives (Barlett & Ghoshal, 1990). It is also needed to apply the

same thought process to implementing a HRIS that incorporates the same strategic steps that will

insure that Motors and More can maximize its resources to the fullest. As more organizations

begin to address reducing administrative overhead cost, HR’s movement to technology will

assist organizations in understanding its need to reduce cost, increase output and maximize

resources to achieve its business strategy ("SHRM," 2013). This action will also show leaders

that HR plays an important key role in generating profit and meeting business needs. Another

goal of HR’s will be to justify the cost of providing its services against the organizations bottom-

line impact ("SHRM," 2013).

Measurement of the HRIS Strategy

Human Resources like any other department will have a vital importance to Motors and

More. HR along with its HRIS can be utilized as an added value operation. By providing its

internal customers with quantitative and qualitative metrics, managers and employees can

improve quality, productivity and service throughout the organization. Without the type of key

information HR would be functioning with only a fraction of its full capability (Fitz-enz, 1995).

Make or Buy Analysis

With any organization, two choices will arise with the implementation of a new IT

system:

1. Will I buy the system from a vendor?


2. Will I create the system from scratch?

These questions are not exclusive; other questions such as “Do I buy a single system from one

vender or multiple systems from others vendors” can arise. These are areas that would have to be

address by both HR and organizational leadership to determine the most advantageous course of

action. The “Make or Buy” concept surrounds itself on whether to create the product internally

using existing resources, or should the product be outsourced to a competent party that can

construct a product to specifications (Helms, 2013) . Before either decision can take place, a

company must gather sufficient information in both areas to make a proper response.

Make It:

Do we have the internal resources available to develop and design the product?

Do we have the funding available to purchase the components to assemble the product?

How will we train the employees to use the new system? How long will it take? What is

the timeline to implementation? What is our total cost (Helms, 2013)?

Organizations that have sufficient resources at their disposal can take this course of action. The

“Make it” method allows for firms to strengthen its core competencies and push its business

strategy forward. This avenue even allows the company to increase its competitive edge in that

market. Organizations that dove in areas of technology gain great advantages when designing

and developing an internal IT system that can later be sold on the market to other organizations

(Helms, 2013).

Buy It:

What products are available? Who are the vendors for these products? What is their

reputation? What is there level to access to resources? Can they create a product to meet

our organizational requirements? What is our total cost (Helms, 2013)?


With the “Buy it” method, the action of the firm is to submit a Request for Proposal

(RFP). The use of an RFP is a formal invitation that an organization submits to potential vendors

or suppliers to acquire information on capabilities to work on a specific task (Garrett, 2010).

RFP’s must contain the Scope of Work describing methodology and compensation for the

completion of the assigned project. Theses contents are required to form the basis of a contract

between the buyer and seller of the product (Garrett, 2010). This method offered is use when

organizations lack sufficient resources to create specific products or if the creation of that

product is extremely costly (in both time and personnel).

Finally, from these two areas, one thing is clear, “Cost”. How much will it cost the

organization to develop an HRIS using either of these methods? Like any company, Motors and

More must take great consideration as to either create an internal HRIS or solicit vendors to

obtain the system? Either way, there will be cost incurrence from this action. A strict cost

benefit analysis should be weighed on either aspect to make a determination as to which decision

to take (Fitz-enz, 1995). In addition, the organization should also account for both the short-term

and long-term uses of the system to meet its business strategy (Helms, 2013).

HRIS Access Protocols

Access to any system must have specific parameters and protocols that allow a user

specific access to their area of importance to make modifications, deletion and additions to the

system. This method put in place the needed quality controls for administrators to Q&A data

inputs to ensure accuracy of information contained is relevant (Armstrong, 2006). Each group

will require specific access to information to do what is need for their assigned task. Examples:

Employee (end-user):

Add or modify personal contact information. Request training or review competed

training, add or modify completion of education. Submit Time and Attendance. Submit and


liquidate travel request. Submit performance appraisal requirements. Submit request for new job

positions.

Line Manager (end-user):

Validate electronic employee information. Review completed training requirements.

Review employee completed education requirements. Review and validate Time and Attendance

Review, modify and submit performance appraisal. Review pending new hires and vacancies for

position availability within their department and access to all files and information pertaining to

their area of responsibility. In the two categories above, these entities would have specific and

limited access to designated areas within the system to conduct routine task essential to the

performance of their job assignments (Bal, Bozkurt, & Ertemsir, 2012).

Unlike the end users with restricted access, IT and HR professionals would have

Administrative Access/Rights (admin user). This level access would give the individual

unrestricted access throughout the system, or a specific section of that system ("SHRM," 2013).

Unrestricted access allows the admin user to perform several functions:

HR Admin Users:

1. Access to all employee personnel information to include career history, training,

attendance, pay grade, salaries, benefits, employee compensation, health records and

employment assignments (Armstrong, 2006).

2. Ability to add/change or delete administrative data, create position description and job

billet assignments. Compile organizational demographics for executive review and

determination of workforce diversity (Armstrong, 2006). Conduct quarterly, semi-annual

or annually review of data to ensure relevant and accurate information is recorded and

stored.


3. Have ability to compile, analyze and conduct, qualitative and quantitative research and

analysis of human resources planning, rewards management and Workforce Analytics

(Armstrong, 2006).

IT Admin Users:

1. Track and monitor all employee system transaction, monitor and maintain system

integrity, and security against unauthorized accesses, removal of data. Ensure system

complies with federal/local government regulations (HIPA, Privacy Act, etc).

2. Be responsible for system updates, system integrity, information security, patches and

system access (Brotby, 2009).

Users that receive this level of access should receive detailed training (initial and annual) as to

proper methods and protocols on the handling, storing and safeguarding of sensitive information.

IT Admin can also as the “watchdogs” of the HRIS system, recording and monitoring the IT

infrastructure ensuring that unauthorized access are detected and thwarted. Motors and More will

have to set in place the required safety and security requirements that meet federal/local

guideline for storing and protecting personal information (Brotby, 2009). It is important for

Motors and More execute governance on protecting information. The benefits for implementing

information security standards will improve awareness at all level of the organizations, thus

producing a culture of information security awareness (Brotby, 2009).

Conclusion

What we have outlined here is only the tip of the iceberg. Motors and More, like its

competitive rivals can be a force to be reckoned with in the small motors and accessories market.

What they required is a plan of action. What we have provided in this transformation plan are

viable avenues that can be develop planned and implemented to bring Motors and More’s


business strategy to fruition. A successful business with a strong and sustainable HR department

that will assist, amplify and expand the business strategy of Motors and More INC


Appendices Table


Table 1.1


Table 1.2


Table 1.3


Table 1.4: Staffing Plan

Position Title #Full-Time # Part-Time Total

President 1 0 1

Administrative Assistant 4 0 4

Finance and Accounting Manager 1 0 1

Account Clerk 3 1 4

Accountant 3 0 3

Accountant Senior 1 0 1

HR Vice President 1 0 1

HR Manager 1 0 1

HR Generalist 2 1 3

Talent Manager 3 0 3

Benefits Specialist 3 1 3

Workers Compensation Analyst 2 0 2

Training Development Manager 1 0 1

Training Facilitators 2 0 2

Manufacturing Manager 2 0 2

Manufacturing Supervisors 5 0 5

Manufacturing Employees 150 0 150

Quality Control Manager 1 0 1

Quality Control Supervisors 5 0 5

Quality Control Employees 15 0 15

Operations Manager 1 0 1

Operations Supervisors 5 0 5

Operations Employees 15 0 15

Maintenance and Cleaning Supervisor 2 0 2

Maintenance Employees 6 0 6

Cleaning Employees 6 0 6

Customer Service Supervisor 2 0 2

Customer Service Employees 10 0 10

Marketing and Sales Manager 2 0 2 Salespersons 15 0 15

Total 272


Table 1.5 Merit Grid

Performance Rating Below Midpoint Above Midpoint Exceptional 5.0 4.5 Above Average 3.5 3.0 Meets Standards 2 2.5 Needs Improvement 1 1.5 Not Meeting Standards 0 0

("Merit Grid," 2011)

Table 1.6 Employee Rating Scale

This Employee is Helpful:

1 2 3 4 5

Unsatisfactory Below Average Average Above Average Outstanding

(Patricia Buhler, 2002)


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