TASK 1

I.CURRENT MOTIVATIONAL STRATEGIES OF EASTERN MEDICAL EQUIPMENT

COMPANY:

1. Monetary reward

Pay plan

Commissions are paid based on results and/or the number of units completed, as opposed to
the amount of time spent on the project, and employees are paid on a piece rate (ILO |
International Labour Organization, 2015). This means that the employee's compensation will
vary according on the amount of labor accomplished. Eastern employs the 3P Pay system and
provides competitive compensation. wherein each individual's payment has the following three
components:
 Base salary is defined by the value of the role.
 Individual performance-based and unit-performance-related financial incentives.
 Person's competence: financial incentives based on the individual's level of skill.

Benefit

Eastern provides a competitive wage and benefits package. The flexible benefits scheme
permits employees to select the benefits that best meet their needs.

2. Non-monetary reward

The company provided its employees with career ladders and training and development
opportunities. This training and development pathway was designed utilizing data obtained by
managers who are able to identify the training needs of their employees and plan and oversee
their individual career development within the units.
The Eastern also provides a variety of training programs to aid its employees in obtaining a
deeper grasp of the product, enhancing their sales and other essential abilities, and promoting
the business culture. After a busy week, Eastern employees are only required to work six hours
on Fridays so they can have more free time. Each year, Eastern provides its employees with a
complimentary 5-star standard travel package, which includes a resort stay and team-building
activities to foster unity. In addition, Eastern offers a variety of club activities, such as
badminton, basketball, and table tennis, to improve the physical and mental health of its
employees.

II.STRENGTH AND WEAKNESS OF THE CURRENT MOTIVATIONAL STRATEGIES:

1. Applying Herzberg’s Two-Factor theory

Herzberg's theory says that corporate rules, supervision, the environment of the workplace, pay,
and job security are hygiene factors that make employees unhappy (University of Minnesota,
2017). Motivators, on the other hand, are things that really make people want to work harder,
like success, recognition, interesting work, more responsibility, and chances to grow (University
of Minnesota, 2017). In the next section, we'll look at how these parts fit into the business plan.

Hygiene factors

When establishing a motivational strategy, Eastern Medical Equipment pays special attention to
certain hygiene concerns. Focusing on competitive remuneration, the company, for instance,
adopts the 3P pay system, which based employee payment on position, performance, and
personal capability. This strategy ensures both internal and external fairness between
employees because it resolves questions regarding why compensation for positions and
employees must differ. Assist employees in comprehending the obstacles associated with
obtaining a high salary and income, so that they can compete and strive to be effective for
themselves and the organization. In addition, this pay structure encourages corporate
expansion. It encourages employees to concentrate more on performance outcomes and to
contribute more through the 3P's salary structure. It increases and improves employee job
productivity.
Additionally, Eastern pays close attention to the supervisory industry. The performance
management system is based on the implementation of the Management by Objectives
philosophy. Managers can set SMART goals at all levels, from the corporate to the
departmental to the individual, using the KPI-BSC performance management paradigm. At the
end of the year and every six months, the managers are able to oversee the achievement of
objectives at all organizational levels and assess the efficiency of workers and work groups.
Employees are provided with comprehensive feedback that enables them to comprehend their
present level of performance, hence fostering fairness.
Eastern's employee incentive programs include free meals, health insurance, a year of paid
vacation at a five-star hotel, and a Friday work reduction. Due to these laws, employees feel
more a part of the company, which may encourage them to work more and reduce their
likelihood of leaving. However, because these regulations were not included in the current
strategy, there is still a lack of flexibility and security for the employees.

Motivators

Eastern has provided its employees with a career ladder and training and development
opportunities. The Career Ladder establishes attainable goals for the organization's employees,
allowing them to select what sort of performance or training goals they must achieve to proceed
to the next level of promotion. In addition, it is a great way to motivate staff to work harder to
meet their performance goals, as they will be eligible for a promotion once they reach a certain
level. Using the Training and Development Pathway, employees can better comprehend how
their job ties to the organization's structure, mission, goals, and accomplishments. When
employees appreciate the significance of their work to the success of the firm, they become
more inspired and excited about their jobs.
Sport clubs and annual holidays enhance the work environment and corporate culture at
Eastern. In addition to their previous training, the CEO, Dr. Thanh, pushed employees to apply
their ideas and creativity to advance their own personal development. This not only makes the
workplace more engaging for the employees, but also enhances their long-term performance.
Employee recognition programs (awards, events, etc.) are one of the primary motivators for
employees since they enhance dedication and engagement, which decreases staff productivity
and efficiency. However, these programs are not addressed in the current plans. Recognition
programs promote a culture of healthy competition among employees and open channels of
communication between employees and bosses, which has an effect on the culture of the
workplace.
In addition, Mr. Thanh's laid-back management style allows managers to approach people
management anyway they deem fit. This results in dissension among managers, some of whom
may be incompatible with Eastern's core values, which may have negative effects on the
workforce. As stated in the last report regarding management in the Eastern company, Tran
Minh Quang, manager of the Eagle team in the Sales department, has a disciplined background
and regularly dictates and demands of his people rather than guiding them. The absence rate of
this team is the highest of any team, and Huong Mai's complaints about Mr. Quang's
management and desire to switch to a more relaxed team may contribute to workplace stress. 

As the graphic indicates, Eastern's technique could be described as "high hygiene and low
motivation." Although employees' basic needs are met and there are few, if any, complaints
about their pay or working conditions, their occupations may not be sufficiently stimulating for
them to perform to the best of their ability. In order to aid their subordinates in significantly
improving and achieving success, managers must supply applicable solutions for the
motivators. Simply focusing on hygiene issues is insufficient.

2. Expectancy theory

In 1964, Victor Vroom initially proposed the expectation theory. Several other scholars, notably
Porter and Lawler in 1968, updated and expanded it subsequently. Vroom lays greater
importance on outcomes than on needs. Vroom differentiates between effort (which arises from
motivation), action, and effectiveness. He argued that people's conduct and motivation to work
are more likely to be influenced by their beliefs of their future ambitions than by their actual
circumstances (Bayers, 2004). This hypothesis is supported by three essential concepts or
relationships:
 Expectation: the conviction that arduous effort will produce fruitful results. This concept
is influenced by factors such as the availability of suitable resources (time, personnel,
etc.), the help required, and the skills required to fulfill the objective ( information,
supervision, direction, etc.).

 Instrumentality entails the notion that successful outcomes will result in respectable
advantages. This concept is exemplified by the relationship between actions
(performance) and rewards, which is especially influenced by factors such as: Clarity in
the connection between work performance and employee awards. Receives labor, seeks
to promote work, cherishes justice, and feels empowered to determine rewards and
punishments.

 Valuation: Indicates the significance of the award to the employee. The relationship
between rewards and individual objectives exemplifies this concept. Valence is
influenced by a number of elements, including the individual's interest in the outcomes or
incentives they receive, their efforts to promote work, and their achievement of job
performance commensurate with the incentive received.

According to Vroom, employees are only motivated when they see all three concepts or
interactions positively. To put it another way, when people feel their efforts will generate better
outcomes, they believe the outcome will result in a rewarding reward that is both meaningful
and in keeping with their particular objectives.
Since the Expectation Theory is based on how employees see their job, it is conceivable that
individuals in the same company will occupy the same position but have different working
motivations as a consequence of their diverse interpretations of the above concepts.
For instance, if a worker aspires to advance at work, promotion is highly enticing to that
individual. An employee has high expectations if he or she feels that when they accomplish well,
they will be acknowledged. On the other side, if an employee does not feel that his effort would
be acknowledged by management, he will not establish high expectations for himself.
A promotion is immensely appealing to a worker who want to further their career. An employee
has high expectations if they believe that everyone would admire them for doing their task
quickly and accurately. However, the individual will have limited resources, and it will be difficult
to motivate this employee to perform a better job if they are aware that the firm would hire from
the outside to fill vacancies and managerial roles rather than promote from within. (Bayers,
2004)

According to the 3P payment technique that Eastern Company is now employing, an

employee's salary is based on their position, performance, and skill. Without mentioning
position-based compensation, Eastern has effectively implemented one of the elements that
may inspire employees: convincing them that their effort and performance are being
acknowledged by management and that their salary would improve if they work more. This is in
addition to the remuneration depending on position.
Using the KPI-BSC model, which measures employee performance, managers may establish
SMART objectives for departments and individuals within it. Stretch goals, also known as
suitable objectives for employees, are formulated in this manner to assist individuals in reaching
their full potential while simultaneously providing monetary incentives using the previously
outlined 3P payment model.

However, it is evident from the Expectancy hypothesis that there are serious flaws with the
existing motivating techniques. The first is that some employees may feel that monetary
incentives are inadequate. Employees believe that individual acts can result in either intrinsic or
extrinsic outcomes. Extrinsic incentives are those selected by the company and management
for the employee and may include money, a status advancement, gifts, or recognition from other
employees. Although Eastern compensates its employees for their accomplishments, the
organization's incentive approaches do not include additional external advantages.
Financial incentives may not always be the most compelling incentives for some employees, as
different individuals are motivated in varied ways. To provide employees with a relaxing work
environment, Eastern has formed sports teams and holidays with team-building activities.
Intrinsic outcomes relate to the sense of success that employees have while completing their
assigned tasks. Additionally, Eastern emphasized the cultivation of ingenuity and uniqueness
when doing regular tasks. Due of the variance in management styles among the teams, as
stated previously, the CEO's backing may not be sufficient to generate drive. Only when
managers demonstrate true interest in each individual can intrinsic incentives exist, yet each
team in the business currently functions in a different environment owing to managerial disunity.
Consequently, only a tiny percentage of the company's employees feel a feeling of
accomplishment while performing their usual duties.

3. Summary

The present incentive program at Eastern has proven to be an excellent illustration of a merit-
based compensation system based on employment position, performance, and aptitude (3P).
Additionally, the company offers a variety of benefits, which is perfect for boosting employee
enthusiasm. The Training and Development program, which helps employees become more
motivated, is one of the benefits of Eastern's non-cash pay. This incentive scheme has issues in
further motivating the employee owing to its inherent polarity and lack of control over the
process of developing an ideal work environment for employees.

III.MOTIVATIONAL STRATEGY

1. Monetary reward

Gain sharing

The 3P payment model utilized by Eastern in its current payment plan has effectively motivated
each employee individually. Gain sharing is an incentive scheme that may give good motivation
for achieving the team's objectives; nevertheless, further motivation and improved teamwork are
required to further excite personnel. The typical Gainsharing corporation monitors employee
performance and distributes funds according to a predetermined formula.
Managers must get training to have a thorough understanding of the Gainsharing concept and
the effective management style. If a firm follows a strategy, it is important to assemble a team of
individuals to work on different areas of the project. The team develops the majority of the plan's
parameters, and top management gives final approval to the plan's specifics. The team is then
responsible for drafting and discussing the elements of the plan.
By promoting collaboration and praising the team's accomplishment, Eastern may strengthen
their working environment and generate deeper links between workers and employer, which will
foster a sense of belonging and motivate people to perform better. (Kruse et al., 2008)
 2. Non-monetary reward

Job enrichment

It is crucial for Eastern to execute the job enrichment program since many employees think that
a stimulating job is an inherent motivator (technique recommended by Herzberg). The strategy
for enhancing a job comprises introducing new aspects such as autonomy, additional tasks or
skills, etc. Work enrichment aims to make a job more exciting, meaningful, challenging, and
accountable (Mac-Ozigbo & Daniel, 2020). By increasing employee responsibilities and
requiring a broader array of abilities, occupations are improved to engage employees.
Several company areas might gain from job enrichment. For example, one of Eastern's sales
managers, Mr. Nguyen Lam Hoan, should encourage cross-functional and interdisciplinary
collaboration. This would aid in the growth of new skills that may require formal schooling. The
training is beneficial since it is stimulating and diverse. The management should then diversify
the workforce by assigning them new jobs, forming teams for quality and other relevant
initiatives, and bringing them on exclusive customer visits, among other methods.
If the sales manager offers a single marketing employee the entire assignment, rather than
dividing it among many employees, this can increase the diversity and responsibility of that
individual's role. Effective for encouraging employee participation and engagement as well as
the acquisition of new skills.

Employee recognition program

By rewarding employees for their effort and dedication, employee incentive initiatives encourage
workers to perform successfully. They are meant to promote high standards of behaviour, offer
employees support and feedback, and publicly acknowledge important achievements. In
general, employee recognition is a means for a company to express gratitude for its employees'
achievements, efforts, and labor (Saunderson, 2016).
This strategy may motivate employees and promote an environment where achievement and
advancement are valued. You may greatly increase productivity and employee satisfaction by
investing time and resources to thanking employees and celebrating their business
achievements.
There are several ways to execute the program. However, there are two regularly employed
strategies that Eastern can profit from. One such honor is the customer service award, which
managers may use to acknowledge employees in customer service roles for achieving sales
goals, demonstrating leadership skills, receiving positive customer feedback, or providing
exceptional customer service. Employees in customer service may be motivated to work
diligently if they get praise, a reward, or a flexible schedule. Regular or annual employee
appreciation programs are a second way to demonstrate your appreciation for your team.
Receiving praise for their hard work in front of their peers may boost the self-esteem of
employees and make them feel valued, so boosting their motivation to succeed. When
coworkers are recognized, it may drive them to work more in order to obtain similar
appreciation.

TASK 2

I.CURRENT APPROACHES OF EASTERN FOR MANAGING PERFORMANCE AND

CONTINUOUS IMPROVEMENT

1. Management by Objectives philosophy (MBO)

Eastern management structures are based on the MBO concept. Management by objectives
(MBO) is a management principle, a technique for planning and managing, and a method of
employee participation. MBO as a management philosophy is predicated on the concept that
employees may self-regulate their behavior. Through the MBO process, managers and their
employees collaborate to establish the objectives, plans, and control mechanisms of a firm.
Using these indicators, they direct the work of their team and assess the contributions of each
member. This technique takes use of the experience of a number of organizational members
(Kyriakopoulos, 2012).

To monitor staff performance and production, Eastern Company established a management

system and capacity evaluation based on MBO. According to the company's corporate culture,
one of its primary goals is to become the nation's leading provider of high-quality medical
equipment in order to develop Vietnam's healthcare system as a whole. This purpose is
primarily provided by the business division of labor, as modest goals must comply to the
SMART principle and be applicable to all levels and positions. At the end of every six months or
year, the manager evaluates the output quality and productivity of people and teams based on
their compliance with goal-setting procedures.

2. Performance management approaches:

Performance measure

A KPI is a quantifiable measure of performance over time for a specific goal (Key Performance
Indicator). KPIs provide teams with objectives to strive towards, benchmarks to measure
progress, and business-wide insights that help individuals make better decisions. The strategic
growth of each department within a firm, from marketing and sales to finance and human
resources, is supported by key performance indicators.
Key performance indicators (KPIs) were implemented by Eastern in order to have the most
impact on their strategic business results. KPIs enable management in monitoring their plans
and assist team members in focusing on what is essential. 2019 (Hristov & Chirico, 2019)
Eastern Enterprise's exclusive KPIs recognition system divides the aim into three tiers:
business, department, and person, with corresponding reward indices of 20-45%, 4-75%, and 5-
10%, respectively. The system is also designed with two primary objectives in mind: increasing
employee engagement at work and contributing to the organization's intangible benefits by
assisting employees in increasing their personal income.

Metrics

BSC (Balanced Scorecard) is a strategic management performance indicator used to monitor

and provide feedback to businesses by identifying and enhancing internal business activities
and the external outcomes that emerge from them. In order to deliver quantifiable outcomes, it
is necessary to gather and evaluate data, as managers and executives must do so. With this
knowledge, corporate workers may be able to make better decisions for the future of their
organizations. The balanced scorecard measures four critical company metrics: learning and
growth, business operations, clients, and money. (Kaplan & Norton, 2003)
Eastern evaluates its business in the following four categories:
 Core values: business ethic
 Professional competence: the individual’s ability and performance related to the work
  Soft skills: the ability to communicate with foregin language and other soft skills that
support the work
 Other skills: Employee’s potential and techniques that suitable for the work

Feedback

In Eastern, SMART feedback is used to create individual and departmental objectives. Without
SMART feedback, teams and individuals alike lack direction and motivation to succeed,
therefore Eastern employs it to boost productivity and performance. SMART is an acronym for
specified, measurable, achievable, realistic, and timely.

II. ADVANTAGES AND DISADVANTAGES OF THE CURRENT THE PERFORMANCE

MANAGEMENT:

MBO

This management strategy significantly motivates The Eastern Company's employees to adhere
to their regular tasks and achieve the company's common objectives. When employees are
aware that their obligations are designed to enhance the organization's goals, they will feel
more accountable and like a member of the team. Regular use of the assessment approach
improves communication between managers and their direct reports. This helps the firm
evaluate the efficiency of worker labor in connection to tasks or smaller goals, as well as
discover elements that impact the ratio of swiftly generated results to those required.
This management model is, nevertheless, subject to various limitations. The first disadvantage
is that the MBO process is costly and time-consuming. There is a substantial quantity of
paperwork. In addition, there are too many meetings and reports to write, which increases the
managers' burden and responsibilities. Some supervisors may oppose the idea because of the
increased paperwork. Second, employees may feel pressured to get along with management
when setting goals and objectives, and as a result, these goals may be set excessively high. As
a result, people may feel less driven and begin to question the MBO concept.

KPI
KPIs are acknowledged in the business world as a beneficial tool or scale that may provide
management in Eastern firms with a clear picture of an individual's or team's purpose or
operations via statistics. As a consequence, recognizing and rewarding employees is simplified
and expedited. In addition, this type of appreciation is employed as one of the SMART
components to aid all employees in establishing consensus on the target they should pursue
(Specific, Measurable, Achievable, Realistic, Timely).
A disadvantage of KPIs is that a company or department may meet its KPIs while falling short in
its client interactions. For instance, the Eagle team is structured to work and divide
responsibilities in accordance with the system's idiosyncrasies, resulting in extraordinary
commercial profit outcomes. The team's working atmosphere, however, garnered bad ratings
and appeared to demotivate personnel. The assessment process must be adaptive and grow in
accordance with the organization's goals. Therefore, until they are assigned specific
responsibilities, employees do not completely get the purpose and advantages of KPIs.
Consequently, the individual may lose motivation to finish duties, and their work process may
become confusing.

BSC

BSC helps businesses to aggregate facts and data into a single report rather than managing
many systems. Managers may undertake assessments to improve procedures and operations
while saving time, money, and resources. In addition to the company's historical financial
success, it provides management with crucial information on the service and quality supplied by
the business. By monitoring all of these variables, executives may instruct employees and other
stakeholders and provide aid and guidance. This helps them to communicate their priorities and
aspirations in order to reach their future objectives. In addition to BSC, Eastern evaluates
applicants based on their level of professional and soft skills as well as their potential for work
success. Combining these two evaluation methods results in an excellent strategy that takes
into consideration not only their successes, but also their performance level and potential. It
enhances the quality of feedback managers deliver to their employees and helps them continue
to develop.

III. SOLUTIONS
 1. Improving the effectiveness of MBO

In view of the aforementioned potential difficulties, several strategies might be implemented in

Eastern to enhance MBO's efficacy.
First and foremost, it is essential to have the support and dedication of top management.
Without this commitment, MBO will never achieve true success. Both senior managers and their
direct reports should perceive themselves as team members. This indicates that bosses must
be willing to share control with their subordinates. Second, all personnel should get formal
training on both the program's principles and its content. This teaching should address how to
develop objectives, how to achieve them, how to measure and evaluate performance, and how
to implement any feedback supplied.

2. Use 360 - degree performance appraisal with KPIs

The disadvantage of KPIs is that managers may be effective in attaining employee KPIs but fall
short in interpersonal relationships. The Eastern performance management strategy may
employ the 360-degree performance approach to handle this issue, with a ratio of 70% based
on KPIs and 30% based on competencies, talents, and behavior.

The application of 360-degree performance evaluation to evaluate other employee attributes,

such as competencies or work habits, will be beneficial. "360-degree feedback" is a
performance evaluation method that incorporates input from the employee's supervisors, peers,
subordinates, and other stakeholders. This strategy is recommended because it enhances the
possibility that employees will have a better grasp of their habits and skills. As a result,
individuals may be more self-aware and cognizant of their strengths and opportunities for
development in relation to crucial organizational objectives. With this strategy, they will find it
easy to implement.
Eastern may build cross-training programs that will allow for more efficient business
management while also fostering workplace evolution. If the organization is able to utilize the
data to educate a member of the marketing team new sales skills, that individual will be able to
cover for a sales team member who must take a leave of absence, so preventing a process
delay. (Tan, 2013)
3. Evaluate and Feedback
Due to the fact that the current management performance assessment and feedback at Eastern
exhibited both quantitative and qualitative data, it was a well-rounded instrument for evaluating
individuals. In addition, this 360-degree feedback + KPI performance management framework
combines quantitative and qualitative assessments, allowing the company to explore several
critical areas of employee performance in a comprehensive and diversified manner.
REFERENCES

ILO | International Labour Organization, 2015. www.ilo.org. [Online] Available at:

https://www.fairwork.gov.au/pay-and-wages/minimum-wages/piece- rates-and-commission-
payments
[Accessed 13 May 2022].

University of Minnesota, 2017. Chapter 5: Theories of Motivation. In: Organizational Behavior.

Minneapolis: University of Minnesota Libraries PublishingUniversity of Minnesota (2017).
Organizational Behavior. Available at: http://open.lib.umn.edu/organizationalbehavior/..

Mac-Ozigbo, A. & Daniel, C. O., 2020. The Effects of Job Enrichment on Employee
Performance. International Journal of Research Science & Management, 7(5), pp. 34-40.

Tan, W., 2013. The Application of 360°+KPI Performance Evaluation Model in Chinese and
Western Culture Background. Communications in Information Science and Management
Engineering , 3(5), pp. 233-237.

Kyriakopoulos, G. (2012). Half a century of management by objectives (MBO): A review. African

Journal of Business Management, 5(6), 1772-1786.

Hristov, I., & Chirico, A. (2019). The role of sustainability key performance indicators (KPIs) in
implementing sustainable strategies. Sustainability, 11(20), 5742.

Kaplan, R., & Norton, D. P. (2003). Balanced ScoreCard–BSC. São Paulo: Atlas.

Bayers, J.J. (2004) Expectancy theory: A universal approach. 

Kruse, D., Freeman, R. and Blasi, J. (2008) “DO workers gain by sharing?  employee outcomes
under employee ownership, Profit Sharing, and broad-based stock options.” Available at:
https://doi.org/10.3386/w14233. 
Saunderson, R. (2016) “Employee recognition: Perspectives from the field.,” The
psychologically healthy workplace: Building a win-win environment for organizations and
employees., pp. 181–198. Available at: https://doi.org/10.1037/14731-009.