KWIK & KLEEN (KK) LAUNDRY COMPANY

(Source: Dessler & Tan, 2006)

Part 1. KKs Consulting Manager
Jen Ko graduated from City University in 2004. After considering several job offers, she
decided to do what she had really always planned to do go into business with her father
Jak Ko.
KKs founder Jak Ko opened his first laundry store in 1990 and had expanded the business to
six stores by 2004. The main business is dry-cleaning and pressing of clothes. Each store
had its own on-site manager and, on average, about seven employees and annual revenues
of about $500,000. It was this six-store chain of laundry stores that Jen joined upon
graduating from City University.
Jens understanding with her father was that as KKs Consulting Manager, she would serve
as a trouble-shooter or consultant with the aim of both learning the business and bringing to
it modern management concepts and techniques for solving the businesss problems and
facilitating its growth.
1. Make a list of five specific HR problems you think KK Laundry has to deal with
2. What would you do first if you were Jen Ko ?
Part 2. The High-Performance System
As a recent graduate and person who keeps up with the business press, KKs Consulting
Manager is familiar with the benefits of programs such as Total Quality Management and
High-Performance Work System.
Her father Jak Ko, the founder of KK Laundry, has actually installed a total quality program
and it has been in place for about five years. This program takes the form of employee
meetings. Jak holds employee meeting periodically, but particularly when there is a serious
problem in a store such as poor quality work or machine breakdown. When problem like
these arise, instead of trying to diagnose them himself or with Jen, he contacts all the
employees in that store and meets them as soon as the store closes. Hourly employees get
extra pay for these meetings. The meetings have been fairly useful in helping jak to identify
and solve problems. For example, in one store all the fine white blouses were coming out
looking dingy. It turned out that the cleaner-spotter had been ignoring the company rule that
required removing (by boiling down the special cleaning fluid before washing item like
these. As a result, these fine white blouses were being washed in cleaning fluid that had
residue fom other, earlier washes.
Jen now wonders whether these employee meetings should be expanded to give the
employees an even bigger role in managing the KK Laundrys quality. We cant be
everywhere watching everything all the time, she said to her father. Yes, but these people
only earn about $5 per hour. Will they really want to act like mini-managers? he replied.
1. Would you recommend that the company expand its quality program? If so,
specifically what form should it take?

2. Assume the company wants to introduce a high-performance work system as a test

program in one of the stores. Write a one-page outline summarizing what such a
program would consist of.

Part 3. The Job Description

Based on her review of the stores, KKs Consulting Manager Jen Ko concluded that one of the
first activities she had to do was to develop job descriptions for her store managers.
Jen realized that what she had learnt about job descriptions in the HR Management course
were too simple. The course did not explain the importance of job description in a real
business situation.
Many times during her first few weeks on the job, Jen found her-self asking one of her store
managers why he was violating company policy and procedures. Repeatedly, the answers
were either : Because I did not know that it was my job or Because I did not know that
was the way we were supposed to do it.
Jen knew that a job description, along with a set of standards and procedures that specified
what was to be done and how to do it, were necessary to solve the problem.
In general, the store manager is responsible for directing all store activities in such a way
that quality work is produced, customer relations and sales are maximized, and profitability
is maintained through effective control of labor, supply, and energy costs. In achieving that
aim, a specific store managers duties and responsibilities include quality control, store
appearance and cleanliness, customer relations, bookkeeping and cash management, cost
control and productivity, damage control, pricing, inventory control, spotting and cleaning,
machine maintenance, purchasing, employee safety, hazardous waste removal, human
resource administration, and pest control.
These were the questions that Jen had to deal with.
1. What should be the format and final form of the store managers job description?
2. Is it practical to specify standards and procedures in the job description, or should
these be kept separate?
3. How should she go about collecting the information required for the standards,
procedures and job descriptions?
4. What, in your opinion, should the store managers job description look like and
contain?
Part 4. Getting Better Applicants
If you ask KK Laundrys Consulting Manager Jen Ko and her father Jak Ko the founding
Manager that the main problem was in running their business, their answer would be quick
and short : hiring good people.
KK is a laundry group with six stores located at various residential areas. Each store has a
manager assisted by a team of cleaner-spotters and pressers. These employees generally
have no more than high school education (often less). However, in a tight market, demand

for semi-skilled workers is very competitive. Over a typical weekend, dozens of helpwanted advertisements for these workers can be found in newspapers. All these people
usually paid about $5 per hour, and they change jobs frequently.
Jen Ko and her father are now faced with the continuing task of recruiting qualified workers
out of a pool of applicants whom they feel are always moving from job to job. Turnover in
their stores (as in the stores of many of their competitors) often approach 400%.
Dont talk to me about human resources planning and trend analysis, says Jen. Were
fighting an economic war and I am happy just to be able to find enough applicants to keep
the business going.
To deal with this problem, Jens father asked her to answer the following questions:
1. First, how would you recommend we go about reducing the turnover in our stores?
2. Provide a detailed list of recommendations concerning how we should go about
increasing our pool of acceptable job applicants so that we are no longer faced with
the need of hiring almost anyone who walks in the door. (your completely worded
online and hard-copy advertisements and recommendations regarding any other
recruiting strategies you would suggest we use).
Part 5. Testing at kwik & Kleen (KK) Laundry Company
Jen Ko, Consultant manager of KK Laundry, and her father Jak Ko, the founder manager,
have an easy yet difficult job when it comes to screening job applicants. It is easy because
for two important jobs the people who actually do the pressing and those who do the
cleaning spotting the applicants are easily screened with about 20 minutes of on-the-job
testing. As Jen puts it, applicants either know how to press clothes fast enough or how to
use cleaning chemicals and machines or they dont. We find out very quickly by just trying
them out on the job.
The more difficult problem is employee turnover. Jen and her father need to implement
practices that will reduce the rate of employee turnover. If there is a way to do this through
the use of employee testing and screening techniques, Jen would like to know about it. This
is because much of management time and money are now being wasted by the neverending need to recruit and hire new employees.
1. What screening techniques can the company use to screen out turnover-prone
applicants?
2. What kind of procedure should be set up to handle reference calls about employees
when they apply for jobs in the company ?
Part 6. Interviewing Candidates
Like all the other HR-related activities at KK Laundry, the company currently has no
organized approach to interviewing job candidates.
Store managers, who do most of the hiring, have a few of their own favorite questions that
they ask. But in the absence of any guidance from top management, they all admit that
their interview performance should be improved.

Similarly, Jak Ko the founder manager himself admitted that he was only comfortable
dealing with the nuts and bolts machinery aspect of his business and was not comfortable
with interviewing management or other job applicants.
Jen Ko, his daughter who is the consultant manager, is sure that this lack of formal
interviewing practices, procedures, and training has caused some of the employee turnover
and theft problems. Therefore she wants to do something to improve in this important area.
Here are her questions:
1. In general, what can Jen do to improve her interviewing practices? Should she
develop interview forms that list questions for management and non-management
jobs? And if so, what form should she introduce a computer-based interview
approach? And if so, what and how?
2. If she implements a training program for her managers, what should be the content of
such an interview training program/ In other words, if she decides to start training her
managers to be better interviewers, should she tell them and how should she tell it to
them?

Part 7. The New Training Program

At present, the KK Laundry has no formal orientation or training policies. Consultant
Manager Jen Ko believes that is one reason why standards are not followed. She would
prefer that certain practices and procedures be used in dealing with the customers at the
front counters. For example, all customers should be greeted with a big hello.
Garments that the customers drop off should be immediately inspected for any damage or
unusual stains so that these can be brought to the customers attention, less the customer
later returns to pick up the garment and erroneously blames the store.
The garments are then supposed to be immediately placed together in a nylon sack to
separate them from other customers garments. The ticket also has to be carefully written
up, with the customers name and telephone number and the date clearly noted on all
copies.
The counter person is also supposed to take the opportunity to try to sell the customer
additional services such as water-proofing, or simply notify the customer that Now that
people are doing their spring-cleaning, we are having a special offer on cheaper cleaning
this month.
Finally as the customer leaves, the counter person is supposed to make courteous comment
like Have a nice day. Each of other jobs pressing, cleaning and spotting, maintaining the
equipment, and so forth similarly contain certain procedures, and most important,
standards that the company would like to have.
Jen Ko feels that the company has other problems because of the lack of adequate
employee training and orientation. Other matters to cover during an orientation, says Jen,

include: company policy regarding lateness and absences; health and hospitalization
benefits (there are none, other than workers compensation); and matters like maintaining a
safe and healthy workplace, personal appearance and cleanliness, time sheets, personal
telephone calls and mail, and company policies on matters like eating or smoking on the job
(both forbidden).
Jen believes that training program will help to ensure that employees know how to do their
jobs right way. She believes that it is only when employees understand the right way to do
their jobs that there is some hope that those jobs will be carried out in the way the company
wants them to be done.
1. Specifically, what should the company include in its new employee orientation
program? How should this information be conveyed to the employees?
2. In the HR management course that Jen Ko took, the book suggested using a task
analysis record form to identify tasks performed by an employee. Should the
company use a form like this? If so, what should the completed form look like?
3. Which specific training should the company use to train the presser, cleaner-spotters,
managers, and counter people? Why?
Part 8. The Performance Appraisal
After spending several weeks on the job at KK Laundry, Jen Ko, the consultant manager was
surprised to discover that her father, Jak Ko, the founder manager, had not formally
evaluated any employees performance for all these years that he had owned the business.
Jaks position was that he had many other important things to do, such as increasing sales
and lowering costs. In any case, many employees did not stay long enough to be appraised.
Further more, Jak said that manual workers such as those doing the pressing and the
cleaning did periodically get positive feedback in terms of praise from him for a job well
done. He would criticize them if things di not look right when he walked through the store.
Similarly, Jak was never shy about telling his managers about store problems so that they,
too, got some feedback on their work.
This informal feedback nothwithstanding, Jen believe that a more formal appraisal approach
is required. She believes that there are criteria such as quality, quantity, attendance, and
punctuality that should be evaluated periodically even if a worker is paid on piece rate.
Furthermore, she feels quite strongly that the manager nedd to have a list of quality
standards for matters such as store cleanliness, efficiency, safety, and adherence to budget
on which they know they are to be formally evaluated.
1. Is Jen right about the need to evaluate the workers formally? The managers? Why or
why not?
2. Develop a performance appraisal method for the workers and managers in each
branch store.
Part 9. The Career Planning Program
Career planning has always been a low priority item for KK Laundry. This is because just
getting workers to come to work and then keeping them is already a big problem. Yet, KKs
Consultant Manager Jen Ko thought that it might be a good idea to start a career planning
program for the employees.

Many employees have been with the company for years in dead-end jobs, and she frankly
felt bad for them. Perhaps we can help them to have a better perspective on what they want
to do, she said to herself. And she believed that the store management group needed
better career direction if the company wanted to develop and grow.
1. What will be the advantages to the company if it sets up a career-planning program?
2. Who should participate in the program? All employees? Selected employees?
3. Outline and describe the career development program you would propose for the
cleaners, pressers, counter staff, and the managers.
Part 10. The New Pay Plan
KK Laundry does not have a formal wage structure. Wage rates are based mostly on what
other employers are paying in the market. They are then modified to maintain some
element of equity between what workers with different responsibilities are paid.
Needless to say, KK Laundry does not make any formal surveys when determining what the
company should pay. Jak Ko, the Founder Manager, reads the want ads almost every day
and conducts informal survey among his friends in the local chapter of the laundry trade
association. While Jak has taken a seat-of-the-pants approach to paying employees, his
salary schedule has been guided by several basic pay policies. While many of his
colleagues adhere to policy paying absolutely minimum rates, Jak has always followed a
policy of paying his employees about 10% above what he feels are the prevailing rates, a
policy that he believes reduces turnover while fostering employee loyalty. Of somewhat
more concern to Jen Ko the Consultant Manager is her fathers informal policy of paying men
about 20% more than women for the same job. Her fathers explanation is,They are
stronger and can work harder for longer hours, and besides they all have families to
support.
1. Is the company at the point where it should be setting up a formal salary structure
based on a complete job evaluation? Why?
2. Is the companys policy of paying 10% more than the prevailing rates a sound one,
and how could that be determined?
3. Similarly, is the companys male-female diferential wise and if not, why not?
4. Specifically, what would you suggest the company do now with respect to its pay
plan?
Part 11. The Incentive Plan
Jak Ko, the Founder Manager of KK Laundry has been thinking whether it is better to pay his
employees an hourly wage or on incentive pay of some kind.
His basic policy has been to pay employees an hourly wage, except that his managers do
receive a year-end bonus depending on whether their branch stores do well or not that year.
He has, however, experimented in one store with incentive plans with mixed results. Jak
knows that a presser should press about 25 tops (jackets, dresses, blouses) an hour. Most
of his pressers do not attain this ideal standard, though. In one instance, a presser named
Wan was paid $8 an hour, and Jak noticed that regardless of the amount of work he had to
do, Wan always ended up going home at about 3.00 pm., so he earned about $270 at the
end f the week. If it was a busy week, for instance, and there a lot of clothes to press, he
may average 22 to 23 tops an hour (someone else did pants) and so he would earn perhaps

$270 and still finish up each day in time to leave by 3.00 pm. So he could pick up his
children at school. But when things were very slow in the store, his productivity would drop
to perhaps 12 to 15 pieces an hour, so that at the end of the week he would still end up
earning perhaps $250 to $260, and in fact not go home earlier than he did when it was busy.
Jak spoke with Wan several times, and while Wan always promised to try to do better, it
gradually became apparent to Jak that Wan was simply going to earn his $270 per wek no
matter what. While Wan never told him so directly, Jak knew that Wan had a family to
support and had to earn about $259 a week regardless of how busy or slow the business
was.
The problem was that the longer Wan kept pressing each day, the longer the steam boilers
and compressors had to be kept on to power his machines, and the fuel charges alone ran
close to $6 an hour. Jak had to solve the problem since the fuel bills were eating up his
profits.
His solution was to tell Wan that instead of an hourly $8 wage he would hencefourth pay
him $0.35 per item pressed. That way, Jak said to himself,If Wan presses 25 items per hour
at $0.35, he will in effect get a small raise. He will get more items pressed per hour and will
therefore be able to shut machines down earlier.
On the whole, the experiment has worked well. Wan generally presses 25 to 35 pieces per
hour now. He gets to leave earlier, and with the small increase in pay, he generally earns his
target wage. Two problems have arisen, though. The quality of Wans work has dipped a bit,
and his manager has to spend a minute or two each hour counting the number of pieces
Wan presses that hour. Otherwise, Jak is fairly pleased with the results of his incentive plans
and he is wondering whether to extend it to other employees and other stores.
1. Should the plan in its present form be extended to presents in the other stores?
2. Should other employees (cleaner-spotter and counter people) be put on a similar
plan? Why? Why not? If so, how, exactly?
3. Is there another incentive plan you think may work better for the presser?
4. A store managers job is to keep total wages to no more than 30% of sales and to
maintain the fuel bill and the supply bill at about 9% of sales each. Manager can also
directly affect sales by ensuring courteous customer service and by ensuring that the
work is done properly. What suggestions will you make to the company for an
incentive plan for store managers?