Question

Exercise 17.1: Organization Development at J. P. Hunt

Read the following:

J. P. Hunt department stores is a large retail merchandising outlet located in Boston. The company sells an entire range of retail goods (e.g., appliances, fashions, furniture, and so on) and has a large downtown store plus six branch stores in various suburban areas.

Similar to most retail stores in the area, employee turnover is high (i.e., 40 to 45 percent annually). In the credit and accounts receivable department, located in the downtown store, turnover is particularly high at both the supervisor and subordinate levels, approaching 75 percent annually. The department employs approximately 150 people, 70 percent of whom are female.

Due to rising hiring and training costs brought on by the high turnover, top department management began a turnover analysis and reduction program. As a first step, a local management consulting firm was contracted to conduct a survey of department employees. Using primarily questionnaires, the consulting firm collected survey data from over 95 percent of the department’s employees. The results are shown in Exhibit 17.5, by organizational level, along with industry norms developed by the consulting firm in comparative retail organizations.

EXHIBIT 17.5 Survey Results for J. P. Hunt Department Store: Credit and Accounts Receivable Department

	Survey Results*			Industry Norms*
Variable	Managers	Supervisors	Nonsupervisors	Managers	Supervisors	Nonsupervisors
Satisfaction and rewards
Pay	3.30	1.73	2.48	3.31	2.97	2.89
Supervision	3.70	2.42	3.05	3.64	3.58	3.21
Promotion	3.40	2.28	2.76	3.38	3.25	3.23
Co-workers	3.92	3.90	3.72	3.95	3.76	3.43
Work	3.98	2.81	3.15	3.93	3.68	3.52
Performance–to–intrinsic rewards	4.07	3.15	3.20	4.15	3.85	3.81
Performance–to–extrinsic rewards	3.67	2.71	2.70	3.87	3.81	3.76
Supervisory behavior
Initiating structure	3.42	3.97	3.90	3.40	3.51	3.48
Consideration	3.63	3.09	3.18	3.77	3.72	3.68
Positive rewards	3.99	2.93	3.02	4.24	3.95	3.91
Punitive rewards	3.01	3.61	3.50	2.81	2.91	3.08
Job characteristics
Autonomy	4.13	4.22	3.80	4.20	4.00	3.87
Feedback	3.88	3.81	3.68	3.87	3.70	3.70
Variety	3.67	3.35	3.22	3.62	3.21	2.62
Challenge	4.13	4.03	3.03	4.10	3.64	3.58
Organizational practices
Role ambiguity	2.70	2.91	3.34	2.60	2.40	2.20
Role conflict	2.87	3.69	2.94	2.83	3.12	3.02
Job pressure	3.14	4.04	3.23	2.66	2.68	2.72
Performance evaluation process	3.77	3.35	3.19	3.92	3.70	3.62
Worker cooperation	3.67	3.94	3.87	3.65	3.62	3.35
Work flow planning	3.88	2.62	2.95	4.20	3.80	3.76

Answer the following questions:

Based on the data in Exhibit 17.5, discuss the strengths and problems at J.P. Hunt.

What suggestions would you make for resolving the key problems you identified?

Answer 1

Analysis of the survey results provided above are-

Satisfaction and rewards

Pay: Supervisors and non-supervisors salaries are less than industry standards

Supervision:  Supervisors and non-supervisors have lesser authorities than the industry standards.

Promotion: Supervisors and non-supervisors are promoted lesser than industry standards

Co-worker : levels are fine for all

Work-satisfaction levels; Supervisors and non-supervisors salaries have lower work satisfaction than industry levels

Performance to intrinsic and extrinsic rewards are lesser than industry standards for all three categories

Supervisory Behavior

Initiation : All three category people have to be more initiating than the industry standards

Consideration : Considerate levels allowed for all three category people is lower than the industry standards.

Positive rewarding is lesser than industry standards for all three while punitive rewarding is on the higher side

Job Characteristics:

Autonomy levels of job can be said to at par with the industry with no high variance

Variety in job is higher than the industry levels, which is good

Challenges in job are more for managers, and supervisors than the industry levels, but lesser for non-supervisors. Considering that challenging jobs are more preferred by workers in-place of routine work, this is a good thing to have.

Organizational Practices

Ambiguity: Role ambiguity levels are so high than industry standards for all three category people. A very bad thing to have

Role confilcting levels can be said to be at par with industry, with slightly high levels for supervisors. A concern, but not a very major one

Job pressure levels are very very high

Performance evaluation process is lower than industry standards. Again a poor thing to have

Work-cooperation levels are high which is good.

Work -flow planning levels are low again. This is again a bad thing to have

Suggestions on improvements

1. In satisfaction and rewards survey, super-visors and non-supervisors are being given far less than industry standards. Hence, increase their pay, work structure, promotion criterias, rewards structure and work quality

2. Even though the pay is lesser than industry levels, workers have to be more initiating, have to be less considerate of others, and have more punitive rewards than others. Either change this structure, and bring these levels to industry standards, or pay your employees higher than industry levels, which-ever looks better according to comapny financials

3. Job characteristics are mostly fine. Variety in job is slightly lesser than the industry standards, so maybe variety in job can be brought. So for that, look for new projects, or shift people inter-departmental, if possible, for your employees to experiene a bit of fresh air and feel less boring about their job.

4. Role ambiguity levels are high, specially way to high for non-supervisors. So, clearly define the job description for specially non-supervisors as an urgent task, and define theri roles and responsibilities.

5. Role conflict levels are at par, but for supervisors. Examine the roles of supervisors, see with which department or with whom their roles are conflicting, and redefine the roles and responsibilities accordingly.

6. Performance evaluation is low standard, develop an efficient evaluation process, ask the HR team to work on this process, and maybe also develop a good appraisal program for the organization

7. Work-flow planning levels are lower than the industry standards. Maybe organize workshops or trainings for your employees to help them desing a proper work-flow, and train them on how to develop an efficient and proper workflow for all types of tasks.

Thanks, feel free to ask if any query is left unsolved or is unclear