FOC101-Summer 2016 - ABC Computers Caselet Questions

  • 24 May 2016 09:55
    Message # 4035552
    Jun (Administrator)


    1. What happened at ABC Computers that led to such a disappointing turn of events (e.g., high employee turn over, disengaged employees, etc.)?
    2. What can you learn from this case study that you can apply to your own organization?
    3. If you are in Tanaka-san's shoes, what would you recommend to the management of ABC Computers?

     Note: Feel free to critique, comment, or ask questions on your classmates' answers.

     DUE DATE: 27 May 2016

  • 24 May 2016 15:24
    Reply # 4035948 on 4035552
    Deleted user


    1. Bad Communication, Slow in Response: The company's leadership (management) team should have responded to the ideas that Tanaka-san and his team brought up.  Even though the Company cannot make changes soon, at least, it was important to show that the company cares and appreciates the employees' feedback. Not communicating is the worst thing - employees think the leadership team is ignoring their feedback.  Bad communication and slow response were the issues happened at ABC Computers that led to this disappointing situation.  
    2. Quick Turnaround, Cordial Communication: It is critical for the company to show the attitudes that they value employees' voice in order to motivate people and retain good people.  Changes in system (in this caselet, salary structure) may not be realized in a week or two.  However, it costs nothing, in comparison with losing good employees later on, to respond to the employees that the leadership team lays values on their suggestions and is thinking about it.  It is possible for any leader to start communicating immediately, even if it is not possible to change it immediately.  Respond. Start communicating. Say something cordial.  
    3. Oh, I might quit if I was in his position - LOL no, just kidding.  Well, if I were in his shoes, firstly, I would recommend the Company to share information with me and some other key employees in this matter because I would like to know the entire company situations and reasons behind the leadership team's decision not to carry out the performance-based compensation system up until now.  There might be specific situations in the Western region. For example, their employees in the Western Division may also be capable but there might be some difficult situations despite their talent.  Or, that may actually be a management issue than a performance issue, in which case changing managers could improve the lower performance in the Western Division.  After figuring out the situations and background information, IF it is really a talent issue (meaning sales reps in the East are truly more capable, talented, and hard-working than those who are in the West), I would recommend the leadership team to consider introducing incentive payment which is similar to the Company's competitors, after conducting competitor analysis in compensation (incentive).  Of course, the same incentive system has to be introduced to all the sales offices, including the Eastern and Western Divisions appearing in this caselet.  
    Thank you for reading!  

  • 25 May 2016 15:37
    Reply # 4038247 on 4035552

    Hi everyone, here is mine.

    1. Losing trust and loyalty from employees: As Rie-san said, the management should have responded. No communication means they don't care about the issue and the effect on their people. When employees feel in that way, it is impossible to keep their loyalty to the company as well as trust in the management.

    2. Transparency of decision making process, sharing the whole situation of the company: I think the reason why they didn't respond to Tanaka-san and his team for a long time was that the management didn't prioritize the issue over other issues within the company. For the top management, HR management is just one of the way to realize the company's vision or business plan and usually they tend to focus more on thier financial targets or business strategies even HR management is closely connected to these. If the management showed the situation inside/outside of the company and shared what they are thinking or planning, the employee might understand or, if not, then they can start communicate to fill the gap.

    3. If I am in his shoes...well the biggest thing is that the management believed the standard pay system worked, so I would firstly ask them why they think so. If it is just they don't want to make the pay system complicated and is troublesome to change it, then I will try to convince them how critical the situation is and the system should be re-designed as soon as possible. Or, if there is a certain reason or background of keeping the current pay system, like Rie-san said there might be specific situation in Western region, they I would recommend to share with the employees to remove their feeling of unfairness.


  • 28 May 2016 23:12
    Reply # 4044945 on 4035552
    1. No response and late in action: To acknowledge and reward performance and effort has a big role in motivating and retaining employees. However, the Management did not recognize its importance until they saw the increasing turnover rate and poor performance. The Management should have listened to Tanaka-san more to learn what problem the team had and what would happen if the situation did not change. At least the Management should have responded to the employee’s feedback on the current pay systems in some way as Rie-san and Misuzu-san said above. If the team finds that their feedback is not appreciated or even ignored, they feel the company does not care about employees, and ultimately it leads to the disappointing situation.

    2. Reliable HR and manager, and quick response: First, HR should be reliable and open for employees including managers to discuss these matters Tanaka-san was aware of. One of our HR missions is to create a workplace that keeps employee engaged, so HR should increase the knowledge and be a go-to place to talk what kind of problem the team/division has.
     Also, manager should be more reliable. Tanaka-san could have expected what would happen if nothing would change. However, he could not convince the Management because at first he thought it was an “organizational issue”, but he should have related this issue to himself as a manager.  At least, he should have got the answer from the Management why they did not want to change the pay system for his team, but he did not.
     Also, any feedback to improve workplace should be appreciated for not only HR but also the Management, and it is necessary to give response to those feedback. No response to the employee’s voice is the worst thing employees experience.

    3. If I were in his shoes, after telling the Management what would happen in sales division if nothing would change, I would recommend the Management to investigate if other divisions have any problems or concerns on the current pay system. If there are some other problems in the company, the performance-based compensation system Tanaka-san presented might not be enough to solve other divisions’ problems and new pay systems need to be established. 

     Also, as Rie-san mentioned, I would recommend the Management to analyze the competitors’ pay system. This will help the Management understand what kind of approach other companies are taking to retain good people.


  • 29 May 2016 19:26
    Reply # 4045679 on 4035552

    My apologies for delay in submitting my replies and joining everyone in this discussion.  I wasn't very well the last few days.  I will do my best to keep the future due dates!

    1. Employees' lost loyalty to and trust in the company.  As Misuzu-san mentioned, I think the management team should have responded earlier to the Eastern Division's issue about the compensation structure, even if they couldn't change the scheme right away, or they needed more time to look into this matter.  The employees of Eastern Division had hope at first after their initial discussion with Tanaka-san, and must have felt that they were being ignored by the company, and that their concern was not taken seriously.  Therefore, they got dis-engaged, and lost loyalty to the company.

    2. It is important for the management to show that the company cares about its employees, and I think HR (who didn't appear in this caselet) could have taken a role to support Tanaka-san's voice to make it heard more, or to convince the management to prioritize this matter over other issues by stressing the critical situation. As Rie-san mentioned, the company will have to look into the matter holistically.  The current pay structure may not be the only issue, but the management team should at least show an attitude that they heard the employees' voices and are examining the matter, and perhaps set a time frame for their reply or show a transparent decision making process, if possible.

    3.  If I was in Tanaka-san's shoes, as a first step, I would closely work with HR to collect feedback from the other divisions regarding the company's pay scheme and, if possible, also about the competitors' comp scheme information.  If the competitors are also keen to adopt, or are adopting, a merit-based pay scheme, I would suggest the company seriously considers a merit-based pay scheme, to retain good talent and keep competitive in the market.  It may depend on the organization, but I think employees are more or less interested in being recognized for their effort in the way of a monetary reward, especially the sales rep groups.  Of course, the management should look at the company's financial aspect and impact of any change when making a final decision, but they should also strive to understand what motivates their employees and to find out how the company can retain passionate and loyal employees.

  • 30 May 2016 13:09
    Reply # 4046160 on 4044945
    Aki Yamamoto wrote:2. Reliable HR and manager, and quick response: First, HR should be reliable and open for employees including managers to discuss these matters Tanaka-san was aware of. One of our HR missions is to create a workplace that keeps employee engaged, so HR should increase the knowledge and be a go-to place to talk what kind of problem the team/division has.

    I totally agree to this HR mission and wonder how closely they are working together on these HR matters when there is a situation. Like in my company I often see business divison managers visits our boss and have quick meetings. Is this the same in your companies or do you have any other oppotunities like official meetings/committees to discuss about HR matters together?

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