HOLY ANGEL UNIVERSITY

School of Business and Accountancy

Case Study Chapter 10

To Reward or To Punish? … That Is the Question
Members:

Bantigue, Rainier

Bumenlag, Mika

Peñaranda, Gabriel Dave

Quero, Shakira

Urquiola, Steven

Submitted to:
Ms. Alma Yutuc

Date:
October 04, 2021
 Introduction

Motivation is focused with how an organization can inspire people to give their best
performance. Employees that are motivated care more about the company's success
and perform better. Increased production due to increased worker effort, enhanced
quality because employees are prouder of their job, and higher staff retention are all
results of a motivated workforce. Managers, according to Heathfield (2021), have a
direct impact on how employees are motivated. The most essential aspect under
control is the manager's relationship with each employee. This is the most significant
aspect that managers can influence. The second most significant aspect is a work
environment and corporate culture that promotes employee motivation and
engagement. These are characteristics that help to create a work environment where
individuals choose to be motivated in order to satisfy the demands of their
employment.

Statement of the Problem

The general manager of the supermarket did a department by department year-end

review of their manager’s performance. As he finished evaluating them, he found out
that all departments - meats, dairy, seafood, deli, bakery, and so forth have performed
well and exceeded the expectations. Everyone did well except for the produce manager
who is assumed to be responsible for the 12 percent short of the expected produce.
The general manager decided to reward all the managers with bonuses except to the
produce manager since he planned to punish him to motivate him to do better. The
general manager thought that giving them rewards would help them to do their job
consistently great and giving punishment (not giving rewards) to the one who failed to
meet the expectations would make him improve more. According to Daniel Kahneman,
the general manager’s decision is not fair and not logical because there are some
factors that must be taken into consideration. Kahneman believes that the second time
would not be as good as the first time that is why the problem is the wrong decision of
the general manager. His decision of punishing the produce manager would have
nothing to do with the next year's results since there are a lot of factors that greatly
affect the outcome. Giving rewards in the form of bonuses would not be an assurance
to make them perform well constantly and punishment would not also be a driving
force to certainly make them perform better than before. In addition, it is not the job
performance of the manager that primarily makes the department’s performance poor,
it also involves a lot of random factors that vary from one performance to the next.
Areas of consideration/SWOT Analysis

STRENGTHS
Supermarkets have a variety of advantages, such as fixed prices because they are
retailers of things, therefore there is no room for bargaining. Availability of
commodities and standard items are also important considerations. Supermarkets offer
consumers practically all of their daily and regular needs in one location. Also, if the
supermarket sells more of its product, they will make more money. There is no chance
of bad debts because Supermarket sells solely for cash. Supermarkets only sell
common items. Mostly customers feel they are paying the correct price for the correct
quantity of goods.

WEAKNESSES
One of the weaknesses is that supermarkets require a large profit to begin operations.
Also, the competitors might also be found in unexpected places. Furthermore, the
pricing freedom is limited, and the product's transportation can be costly which can be
a weakness. It is not practical for supermarkets to provide after-sale services. As a
supermarket, it deals in perishable items such as vegetables, fruits, dairy products, and
so on which may consume the capital. Customers must select things without
assistance, and no additional facility is supplied to them in these markets, thus they are
dissatisfied.

OPPORTUNITIES
Supermarkets can cater to a wider range of tastes, including flat business, and there
are countless lovers of these types of items which can be their opportunity. It will also
benefit Supermarket to offer products that are similar to those found in other
supermarkets, as its competitors do. The beautiful thing about Supermarket is that it is
unaffected by customer purchasing power. If the federal government implements
taxes, the cost of living will rise. Supermarket prices have remained stable in recent
years as a result of many countries' economic strategies.

THREATS
The modern operations and products of supermarkets comprise numerous activities
that are pricey it can be a threat for the future customer. They don't have any cost-
controlling evaluations or procedures which is very alarming for the standard of the
consumers. The cost of labor and basic materials is steadily rising. To mitigate this
hazard, they can engage on cost-cutting methods. Alternative products or services can
pose a danger to a company's success. If a brand-new entrant in the market produces
dairy-free products, the customer will choose that brand. Moreover, supermarkets
consider that the cost that occurs is significant, and the earnings generated are low in
comparison to their financial commitment. As a result, the company must develop
long-term strategic goals to reduce its raw material use.
Solutions to the problem

Alternative Course of Action 1

Take steps toward improving morale. When employees are happy with their jobs, they
perform better. Examine factors such as the work atmosphere, benefits, salary level,
and employee comprehension of the mission and vision. Employees better understand
how their work contributes to the company's success are more likely to give it their all.
Advantages
a. Cohesion and collaboration are enhanced when employees have a good
attitude.
b. Employees with better morale are more inclined to assist one another in
initiatives and collaborate toward common goals.
Disadvantages
a. Managers will have to work extra hard because they will have to interact
with, understand, and supervise their staff.
b. It will take time to assess whether the employee's performance in the
department will improve or remain the same.

Alternative Course of Action 2

Reward management is the implementation of strategies or policies to help reward
everyone in the company, in a fair and consistent way. When you reward your
employees for good work, they feel valued and more motivated.

Advantages
a. Rewards provide an opportunity to not only promote productivity but do so in a
way that aligns with your company values.
b. If the company wants to build a stronger, more positive company culture,
reward management should be implemented.

Disadvantages
a. If the gifts a company gives are performance-based, employees who did not
receive a gift may feel less motivated to work.
b. Giving gifts to employees may lead them to expect similar gifts in the future,
especially if the gifts are given at specific time.
Recommendation

PLAN OF ACTION

RESPONSIBLE SOURCES OF POTENTIAL

SOLUTIONS DEPARTMENT AGREEMENT BARRIERS/ CHANGES/RESULT
CHALLENGES

Improve CEO
Morale Extra work for Better
Supervisors All levels of the managers collaboration
the
Managers management Time Workforce will be
consuming enhanced

CEO Promotes
Reward All levels of It can affect to productivity
management Supervisors the employee’s
management motivation Provides stronger,
Managers more positive
It can give company culture
false hope to
employees