Human Resource Management.

MGT 351
FALL 2020
Case Analysis

Please clearly mention your name, ID and section details in the table provided below

Student Name ID
Ahnaf Munim 1911927630
Sadman Sakib Mahin 1922005030
Mehran Alam 1931338030

(READ CAREFULLY)
This assignment contains the following sections:
Case: The Proposed Merit Program: Should the Winner Take it All? 14 marks

Due 21 January, 2021 by 10.30 PM Points 14

Follow the instructions below and give your best for this assessment. Failure to comply will lead to loss
of marks.

Instructions (READ CAREFULLY)

● In order to attempt case studies successfully, you must address the case solution as per the following
format
✔ Background and Situation Analysis – Before answering the core case questions
✔ Problem Identification (if any)
✔ Solution/Answer/Recommendation with proper justification (whenever and wherever required)
● The answer cannot exceed the stipulated word limit for each question.
● Student name, ID, section MUST be clearly mentioned.
● Under no circumstances the assignment deadline will be extended and for every day of late submission,
30% will be deducted from the assigned marks. So, best utilize your time.
● All submissions will go through plagiarism check and the plagiarism limit is up to 10%.
● There will be no compromise with the quality and most importantly, integrity. Any plagiarism or
whatsoever beyond the stated limit in the assessment instructions will result in an F grade in this course.
● Format: Font type – Times New Roman/Calibri, Size – 12, Spacing 1, 1-inch margin on all sides. Grammar
and spell should be thoroughly checked.
● Any email asking questions that have been clarified here and asking for undue favors will be ignored.
● Remember, the deadline for submission is on 21 January, 2021 by 10.30 PM which will not be extended
under any circumstances!
 CASE - 14 MARKS
The Proposed Merit Program: Should the Winner Take it All?
● Remember, in order to attempt case studies successfully, you must address the case solution as per the
following format
✔ Background and Situation Analysis – Before answering the core case questions (CARRIES 2
MARKS)
✔ Problem Identification (if any)
✔ Solution/Answer/Recommendation with proper justification (whenever and wherever required)
● The answer cannot exceed the stipulated word limit for each question.

● The main case is 7 pages long followed by the required information in the appendix. To find out answers
to the questions, you have to go through ALL the information provided in the case.

Learning Objectives
The case was developed from field research and organizational documents. The case events are real, but proper
names of characters and organizations have been disguised. The general purpose of the case is to provide an
opportunity for students to gain experience in analysis of merit pay programs. The main objectives are:

● To improve understanding of the relationship between performance appraisal ratings and pay increase
programs
● To demonstrate the need for compatibility of performance appraisal ratings with pay increase programs
● To develop skills in the use of performance appraisal data to develop pay increase recommendation
● To illustrate the challenges and complexities of administering a merit-based pay increase program.

Questions: (12 marks + 2 marks for situation analysis and problem

identification)
IMP Note READ: Students are advised to analyze all the information presented in the case, use their judgement,
follow class discussions from the previous chapters especially - 
Chap 9: Performance Appraisal and Management
You can also draw inspirations from the concept of Organizational Justice part from Chap 14: Ethics, Justice, and
Fair Treatment at Work.

1. The College of Business used a three-year average of performance ratings as a basis for merit pay. Is this
appropriate for administering merit pay? Why or why not? (no more than 500 words) 2 marks

2. (a) How should Professor Foreman determine which Marketing Department faculty members are eligible for
the merit pay increase under the existing plan and proposed pay? Provide reasons for your answer (No more
than 500 words) 2 marks
(b) According to the existing guidelines for merit raises, which faculty members would be in top third, middle
third, and lowest third of the department? Provide reasons for your answer (no more than 800 words)
4 marks
(c) According to the proposed guidelines for merit raises (awarding merit pay to the top 20 to 25 percent),
which faculty would receive pay increase? Provide reasons for your answer (no more than 800 words)
4 marks
 You can start answering from the next page.

Background and situation analysis

Carroll State university is large school located in the Southeast. Recently the university was
struggling to increase salary of its faculty members due shortage of fund from the state and the
funds being allocated for other uses. Recently business student enrollment in Carroll State
university has also reduced by 10%. The salaries provided by the university were lower than the
market equilibrium and had not kept up with the increasing living cost. This has caused some top
performing faculties to leave the institution and seek employment elsewhere. As a result, the
university tried to retain the top performing faculties with salary increments while other faculties
felt demotivated as their salaries were not increased. Previously the university provided salary
increases for its faculties and staff based on ATB(across the board) where all faculties and staff
received a percentage increase in their salaries and merit pay where a faculty had to submit a
portfolio where the faculty had mention his or her degree of contribution in each of seven
categories set by their respective department. The department chair would then decide whether
the faculty deserves a salary increment by assessing the faculty’s contribution in each of the
seven categories. The dean Dr. Fred Simon held a meeting with department chairs to discuss a
new merit pay plan to assess a faculty’s performance which aims to reward and retain the most
talented and mobile Faculties. The new plan is like forced distribution method where the
supervisor will allocate a place for every faculties, the top 20% to 25% will be made up of top
performing faculties and the remaining percentage will be made up of average performing
faculties. After the proposal of the new merit pay plan, each department chairs expressed their
opinions on the feasibility of the new proposed plan. The dean concluded the meeting by asking
each chair to examine the proposed plan and to provide recommendation along with proper
justification about the new plan in next meeting.

Q1. I think that the 3-year average of performance rating as basis for merit pay is a good way to
administer merit pay. It is a suitable way since employer measures the performance of the
employees based on his or her level of contribution in each of 7 categories which are used as
performance standards to measure an employee’s performance over a time period of 3 years.
After assessing and analyzing an employee’s performance over a time period of 3 years, the
employer is required to consult with the employees about their performance over that period.
The advantages of the three-year average performance rating are
1. Employee retention : Using the three-year average performance rating, the institution
can easily differentiate between good performing and bad performing faculties. The
 institution can find out top performing faculties and reward them accordingly in order to
retain the top performing faculties so that they don’t leave the organization.
2. Acts as motivation : The performance rating will act as motivation for the employees to
work hard as their salary increments depend on how well they perform over the 3-year
time period as a result, the employees will try to give their best performance in order to
achieve salary increment.
3. Helps to identify employee weakness : The faculties can use the feedback from the
performance rating to see where their deficiencies are and improve upon them the next
time.

However, there are some disadvantages

1. Difficult to measure : As mentioned in the case, an employee’s performance is measured
by his or her degree of contribution in each of 7 categories. However, from all of the 7
categories, it is difficult and challenging to measure an employee’s contribution in some
categories such as university service which is intangible in nature and this will make it
difficult to reward employees accordingly which may lead to dissatisfaction in some
employees.

As the advantages outweigh the disadvantages of using three-year performance rating as

basis for merit pay, I think that the 3-year average of performance rating as basis for merit
pay is a good way to administer merit pay.

Q2a. This year the board has fixated on the decision to increase the salaries of only a handful
of faculty members due to significant decrease in funding. Hence Professor Foreman
has to carry out the tough and tedious procedure of evaluating and selecting the faculty
members that will be eligible for salary increase. Do this, professor foreman has to come
up with an evaluation program that is not only fair but also is able to carry out effective
evaluation of individual faculty members according to their area of expertise. Choosing
the tool for evaluation can be a very difficult task the duties and responsibilities of faculty
members very immensely. Hence professor foreman has to initially categorize the job of
faculties into distinct groups with similarity. The category has to be fair so that it can
properly evaluate each member. The tool to be used would be the graphic rating
method. in this method performance is evaluated on a basis from unsatisfactory to
satisfactory along with from good to excellent. The criteria for evaluation should include
teaching credentials of the teachers, ratings given by their respective students, number
of thesis papers they have submitted, how much advising of doctorate students they did,
etc. Now professor form in has to observe each employee in depth and has to mark up
the faculty members with their respective scores and find out which employee was the
most outstanding in his field of work and is to be nominated for pay increase.

2c. The proposed guidelines for merit raise works like forced distribution method of performance
appraisal where the employer allocates a space for every employee. The 20% to 25% will be
occupied by top performers and the rest will occupied average and poor performing employees.
Under this guideline, only the best performing employees who occupy the top spot of 20% to
25% will be rewarded. The new guidelines were proposed as result of decrease in funding from
the state. The institution was struggling to retain its most talented faculties as they getting better
job opportunities with higher salaries from the competitors. In order to retain the talented
employees, the institution proposed the new guideline for merit raise. Under the new guideline
professor Foreman will have to choose faculties who have scored the highest in all three
evaluation and then reward them accordingly. According to professor Foreman’s worksheet,
there are 13 faculties in the department of marketing. So, under the new the guideline Prof.
Foreman has to choose only those faculties who have scored highest in all three evaluation. The
faculties who should receive the salary increase are
1. Radhika Bose
2. John Young
3. John Randell

The 3 faculties mentioned above should get the salary increment as these three are only ones to
receive 2 “excellents” and 1 “very good” in their evaluations and these three faculties should be
placed in the top 20% of faculty in marketing department for their outstanding performance. No
other faculty has received such performance in all of the three evaluations done on them so as a
result those other faculties will not be designated in the top 20% according to new guidelines and
will not get salary increment.