Business

Managemen
t Case Study
This report is an analysis of the management structure of ACME
Food Processing, any problems the business may have, and the
ACME Food
appropriate solutions to these managerial problems. Processing
INTRODUCTION
ACME Food Processing is a business located in an outer city suburb. For many years the business has
had high absenteeism, high turnover of staff and low productivity. It follows a classical-scientific
approach to management with autocratic leadership. This report will analyse the current
management structure and recommend changes to address these problems.

CURRENT BUSINESS ISSUES

ACME Food Processing is currently dealing with several employee-related issues, all of which can be

Chapter: Aspects of Change

attributed to the current management type – classical-scientific. These issues are:

 High employee absenteeism rates

 High turnover of staff
 Low productivity

The most likely reason for these problems is that the workers don’t feel appreciated. The autocratic
leadership style leaves no room for employee contribution to the running of the business, and they
are treated impersonally and quite often ignored when they suggest improvements for the business.
Since the classical-scientific method relies on each member doing their individual task to contribute
to the whole business, the high levels of absenteeism mean that work is not getting done; therefore
the productivity of the business will suffer.

Currently, because of the division of labour there is no communication between low-level employees
and management, so none of these issues are being addressed. The workers are not treated well,
and this leads to dissatisfaction and lack of job interest. The employees do not stay with the business
for a satisfactory amount of time, which can increase the cost of training new staff.

The classical-scientific method works well in workplace situations where speed and accuracy are
required: occupations such as the police force and military. Employees need to follow the autocratic
style and accept orders without question in order to be effective. This level of technicality is not
needed in this situation: the business would function much more effectively if the workers needs
were met.

These problems can be addressed by bringing in a new management style – Behavioural.

BEHAVIOURAL MANAGEMENT THEORY

Behavioural management theory focuses on the needs of the employees, both as individuals and
working in groups. The worker is viewed as a social man, whose behavior is affected by his/her social
context and by his/her interpersonal relationships.

The behavioural management theory works by:

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  Paying attention to workers’ needs to improve their satisfaction and morale. This in turn
leads to reduced absenteeism and improved productivity.
 Motivating workers by allowing them to form social bonds with their co-workers, which
helps to impart meaning to work that is otherwise dull and unfulfilling. Workers experience a
sense of belonging, loyalty and obligation to a work group.

STRENGTHS

The behavioural style employs a strong interpersonal approach to people management and a
flattened management structure, which allows all employees to communicate freely with their
managers. This creates stronger lines of communication within the business which flow both ways,
ensuring that workers remain happy and any problems are addressed.

A behavioural style of management is more effective in reducing staff turnover than classical-

Chapter: Aspects of Change

scientific as it makes the employees feel more at home & gives them a sense of belonging to their
workplace. Improved worker morale will reduce conflict between co-workers and decrease staff
absenteeism rates.

WEAKNESSES

While this style does improve worker morale, it can create conflict in some cases, if employees are
given too much power and have conflicting ideas about the future of the business. If the
management gets too lax and allows their staff to do as they please, the leadership style may be
described as lasseiz-faire. In this case, management needs to step in and remind the workers that
this is not a democracy, and that their ideas are simply suggestions and are not the definite plan for
the business. It is important for management to find the right balance in their leadership style, and
not fall too far towards autocratic or lasseiz-faire.

ACTIONS & STRATEGIES

The behavioural theorists emphasised the leading, motivating and communicating management
functions as the most important for improving worker productivity.

LEADERSHIP

Leadership is the ability to influence a group towards the achievement of goals. A manager must
direct people, motivate them, communicate with them and resolve conflicts. Many employees lack
self-motivation and require a leader to give them a push in the right direction.

One strategy that has proved to be effective is to place workers in teams which work together to
achieve a common goal. This improves their self-motivation and communication skills. To encourage
employees to feel pride in their team, let them adopt leadership roles amongst themselves. This will
also improve their motivation and leadership skills.

MOTIVATING

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Motivating employees to exert high levels of effort to achieve the business’s objectives is a difficult
but necessary task for any manager.

Some common methods used by management to motivate are:

 Matching people’s individual skills and personalities to suitable jobs.

 Setting employees specific goals and providing feedback on the achievement of these goals.
 Linking performance with rewards such as pay increases and promotion.
 Recognising achievement.
 Positive reinforcement – encourage success, do not just penalise failure.

COMMUNICATION

Communication is the exchange of information between people. It is essential for management to

Chapter: Aspects of Change

have adequate communication with all employees, sharing necessary information and imparting
vision. One strategy this company could adopt is to hold regular communication meetings to be
attended by all employees to ensure that they are aware of the objectives and plans of
management.

FLAT ORGANISATIONS STRUCTURE

By using flat organisational structures, workers do not need strict supervision or frequent
instructions, which is a characteristic of a hierarchical structure. This leaves management with more
spare time. With the lightening of manager’s workloads, the middle layers of management can be
removed, providing the business with more working staff, and giving managers a wider span of
control.

If the business uses multi-skilling rather than the classical-scientific method of division of labour, the
employees will be more flexible and be able to perform a wider variety of tasks. This will reduce
boredom at work and jobs will still get done when staff are absent.

ASPECTS OF CHANGE

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By bringing in a completely new management team, the business will need to ensure that change is
managed effectively. Failure to manage such a large change effectively could result in failure of the
business.

This change is known as an internal influence. The new management team will bring with it a new
business culture and possibly a new company vision. This culture may not be compatible with the
remaining employees, and there are several reasons why they may resist the change. Researchers
attribute this resistance to fear of the unknown, concern over personal loss, and the belief that
change is not in the best interest of the business.

Managers or owners may experience inertia – i.e, the lack of desire to change. This can cause the
business to miss out on lucrative opportunities which would otherwise propel it forward.

To manage change effectively, the business must first identify the need for change. This is the job of

Chapter: Aspects of Change

the managers of the business: they require anticipation, intuition, imagination and experience in
order to do this successfully. The business must then set realistic, achievable goals, preferably short-
term.

At this point, the business’s success or failure will depend on the culture of change of the business. If
the employees are open to it, and the managements aren’t dealing with inertia then the change will
go smoothly. However, if the staff is resisting the change, it will be necessary for the business to
bring in a change agent. A change agent is somebody within the workforce who can persuade the
rest of the staff that a change is in both their best interests, and the best interests of the
organisation.

CHANGE MODELS

Change models explain how change occurs in an organisation, and how it can be promoted. There
are two primary change models.

FORCE-FIELD ANALYSIS

This model analyses changes as a state of imbalance between driving forces and restraining forces.
To achieve change, the business must promote the driving forces and weaken the restraining forces.
If driving forces are greater than restraining forces the change will be allowed to take place.

DRIVING FORCES RESTRAINING FORCES

TODAY

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UNFREEZE / CHANGE / REFREEZE

1. Unfreezing – The first step is to persuade staff to be receptive to the possibility of change.
This must be done BEFORE the change is implemented.
2. Changing – While the employees and managers are convinced that change is required, then
a range of solutions must be put forward and acted upon, as soon as possible, before
resistance builds up again.
3. Refreezing – To ensure permanency, the change must be formalised in some way, so that all

Chapter: Aspects of Change

employees are familiar with it.

This method is effective at giving a structure for managers to follow when introducing change to a
business, but is no longer accepted as an appropriate model to describe the process of change in a
business. A business is fluid and dynamic, and rarely stays in a stable ‘frozen’ state. For this reason,
the Force-Field Analysis is a more appropriate model.

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