Name: Nguyễn Ngọc Trà My

Student ID: S3938290

Class: BUSM4185B

Lecturer: Ngan TTT

Date: 15/4/2022

Word count: 1814 words

I. ISSUES
1. Poor Human Resource Management
One prominent issue that Coffee Family had is inadequate human resource
management. Ulrich and Brockbank (2008) indicate that human resource management
plays a crucial role in creating and maintaining an organization’s ability to bring value to
its customers, shareholders, and employees. Human Resource Management ensures
high-performance work practices, for instance, improving employees’ commitment, and
low rate of absenteeism, thus, enhancing productivity (Vang, 2012). In this particular
case, the issues arise mainly from internal factors.

Firstly, Coffee Family failed to empower its employees. According to Bianca Arendse
(2013), businesses need to maintain work motivation and satisfaction amongst
employees, which will make them more engaged with the firms. Evidence shows that the
more engaged the workforce is, the higher the organizational performance as a result
(Emma Bridger, 2018). The high level of job satisfaction influence positively the
turnover rate and the organization’s name (Paul E. Spector, 1997). However, the
company offered its employees compensation packages that is not beneficial enough:
no bonuses or rewards even when employees showed outstanding performance which
resulted in a high rate of turnover since the workers saw no vision of them getting a
promotion. Eventually, this would decrease productivity since there is no reason for
workers to do their best. Or in a worse scenario, the employees will quit and start to work
for the firm’s competitor as happened to Coffee Family.

Secondly, weak organizational culture is also a reason that led to the reduction of
employees’ motivation. Having strong bonding at work is directly linked to better
outcomes (Julianne Holt-Lunstad,2018). Communicating in the workplace environment
is crucial for effective collaboration and thus, leads to great outcomes (Margaret
Purcell, Roy McConkey, and Irene Morris 2000). But in this situation, the employee
claimed that she had no connections within the internal environment, which demotivates
the workers and leads to job dissatisfaction. According to the Hawthorne studies
conducted by Elton Mayo, attitudes towards people and group norms are associated
with productivity. The manager noticed that employees showed up late for work, the
extreme use of sick days, and express inappropriate attitudes.
2. Poor customer experience
Another substantial issue of Coffee Family is not being able to deliver good customer
service. This dissatisfaction arises mostly from bad-mannered employees, poor service
in general, employees not being responsive, or delayed service (Helms and Mayo
2008). When customers don’t get the experience they expected, they are inclined to
switch brands (Shep Hyken 2018). Eventually, it would harm the sales efforts and
affect the company’s profit (Howard Feiertag 1999). Displeased customers might simply
do nothing, or they can complain or stop using your service (Lovelock et al. (2001),
cited in Helms and Mayo 2008). Companies may also lose potential customers since
those dissatisfied customers tend to share their bad experiences with others (Helms
and Mayo 2008). There are two main grounds for this intricacy.

To begin with, insufficient training is one considerable problem. Employee training

enables employees to develop essential skills and knowledge, helping them to
“understand management initiatives” (Cunningham and Hyman, 1999; Pun et al.,
2001, cited in Kevin and Haiyin 2010). This process can have a huge direct impact on
an organization’s productivity (Karen, Eric, and Jeremy 2012). Coffee Family deficient
training is the main cause of decreased productivity, and weak connections between
employers and employees, which result in job dissatisfaction that leads to absenteeism,
and a high rate of turnover (Open Textbook 2016). All of these are of great harm to the
organization as the costs of recruiting and selection are not negligible (Open Textbook
2016). Specifically, Coffee Family’s workers are inexperienced, and not well-trained in
policies, and services which are directly linked to unpleasant interactions with
customers.

Besides, because Mr. Minh could not provide his employees with enough work skills,
they fear being accountable for what they do wrong. Lack of decision-making skills and
self-managed skills leads to the overburden of the manager and the procrastination in
solving the problems for customers as mentioned in the case study. The firm has not
been able to understand and make use of its workers effectively which is contradicted
Henri Fayol’s Administrative Theory (Daniel, Arthur, and John 2002). These are
caused by insufficient empowerment in the workplace. Empowerment is a
fundamental contributor to an organization’s innovativeness (Gomez and Rosen 2001)
and effectiveness (Conger and Kanungo, 1988; Chiles and Zorn, 1995; Koberg et al.,
 1999; Morrell and Wilkinson, 2002; Bartram and Casimir, 2007, cited in Kevin and
Haiyin 2010). Without empowerment, business management is likely to fail (Houtzagers
1999). Particularly, a customer of Coffee Family had to wait too long for her drink to be
corrected which made it a disappointing experience.

II. SOLUTIONS
1. Adjusting the employee training program
Training is a significant contributor to the success of a company. According to Walters &
Griffin (2013), training programs are a smart investment for organizations since they
allow individuals to grow better skills. Inadequate training leads to deducted productivity,
and lost customers (Open Textbook 2016) specifically in the Coffee Family case, it
affects the performance of employees and results in losing customers. This can be
solved by appropriate training which was stated in the Taylorism theory that it is the
company manager’s responsibility to find out the most sufficient approach for employees
to complete their tasks, provide them with the necessary skills and knowledge, and
encourage high-performance work practices (Littler 1978). To improve the training
program, the manager can establish an employee orientation that supports employees’
understanding of policies and their specific jobs.
2. Enhance employee empowerment
Employee empowerment is another solution that can be added. They should apply
Taylorism principles, for instance, as mentioned in the first principle, tasks should be
divided based on their skills, and the distinction between managers and workmen tasks
(Turan 2015). To be clear, the top executives are in charge to instruct middle managers
to train the employees to make job decisions independently when necessary. The
greater involvement and responsibilities the employees have in the accomplishment of
the company, the better the outcomes are for both the company and the employees
(Open Textbook 2016). According to the Hawthorne studies, employees’ performance
improved when they feel valued (Open Textbook 2016).

3. Increase the compensation package

A good compensation package attracts the most suitable people for a job, maintains
employee retention, and overall brings positive outcomes (Open Textbook 2016).
Recruiting and training new people is an excessive time-consuming and costly process,
 therefore, retention of current workers is essential (Open Textbook 2016). To prevent
job dissatisfaction and high turnover rates, the top executives can consider raising the
base wage or giving bonuses to high-performance workers. These new compensation
policies should be good enough to attract qualified employees but also harmonize with
the company’s revenues. Furthermore, by using these financial rewards on the
performance of employees, the managers obtain Reward Power which can greatly
influence the employees (Riasi & Asadzadeh 2015).

III. RECOMMENDED STRATEGIES

1. Restructuring training methods
The answer to the insufficient training issue is that the manager needs to schedule
training sessions, especially at the beginning. Specifically, Mr. Minh should have a
training session after recruiting the workers, which includes orientation, the learning of
the company’s policies and a have an idea of how their job influences the big picture on
their first day of work. It is recommended that the employees should be assigned a
mentor which can be an experienced colleague to guide them through their job step by
step (Open Textbook 2016). By observing and learning directly from a skilled senior,
the newbie can quickly become qualified and give good performance. Thus, they will
have communication skills, good manners, fulfill customers, and contribute to the
company’s success. Mr. Minh himself could participate in external training courses to
enhance his leadership skills. This will reduce greatly the number of inexperienced
employees and create an optimistic relationship between the senior employees and the
beginners through the act of informal training.

2. Giving employees the authority

After ensuring that the staffs have enough skill and experience through proper training,
the manager should have an assessment to decide on the staff is qualified enough to
give authority. To do this, top executives of Coffee Family are recommended to talk
about the philosophy of empowerment thoroughly to each branch’s managers. This step
is required because this approach refutes Max Weber’s Theories of Modern
Bureaucracy as he believed bureaucracy “is the most efficient, the most calculable, and
thus 'formally' the most rational means of exercising authority in every form of
organization" (Ringer 2004, cited in Sager & Rosser 2009). Then, the managers will
 have to grant employees the level of authority under specific limitations to their job roles
(Patterson et al, 1996; Graham & Titus, 1979, cited in Fadal 2004).
3. Giving rewards based on performance
As the ex-employee mentioned, the staff were demotivated because they weren’t offered
any incentives. It is recommended that the company give rewards or bonuses to high-
performance and productive individuals regarding efficiency, attitude, absenteeism, and
punctuality. To clarify, Mr. Minh can create a daily assessment record with the elements
mentioned above and supervise the staff thoroughly to come up with appropriate
incentives to improve employees’ satisfaction, and thus, better retention. Moreover,
considering getting customers’ feedback to evaluate staff’s performance could be a
reasonable approach. According to The Reinforcement Theory, positive performance is
likely to happen again when rewarded (Open Textbook 2016). With a reasonable pay
system, employees are happier which directly leads to better customer service (Open
Textbook 2016).

The top executives and branch managers of Coffee Family should also provide
employees with indirect monetary benefits such as insurance, paid absence, and
vacation along with direct payment: wages, incentives, commissions, bonuses (Dessler
2006, cited in Sudiardhita, Mukhtar, Hartono, Herlitah, Sariwulan, & Nikensari
2018). By doing this, the company can raise workers’ motivation considerably. Giving
bonuses to “Employee of the Month” from each branch is another approach. The title
would give the employee the feeling of being recognized by a superior and a sense of
achievement which are the two motivation factors according to Herzberg Two-Factor
Theory (Herzberg, et. al., 1993, cited in Open Textbook 2016) that encourage them to
advance further.
4. Establish activities to enhance connections
Creating a friendly working environment is another potential component in the long run.
To do this, Mr. Minh could arrange some group activities occasionally, for instance,
outdoor parties, and sports days. As mentioned above, travel for staff is another element
to connect employees other than motivating them. Alton (2016) stated that a trip
relieves stress and is a great chance to bond with everyone within the company, which
would increase the esteem and productivity of the organization. Besides, compliments
are also great means to encourage productive workers and at the same time allow the
manager to appear more approachable. In other words, this effort would minimize the
distance between the employer and employees.

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