Introduction to Business

Business Case: ‘A Zero Wage Increase Again’

Student Name: Shubham Kaushik

Case Study Aid – Problem Diagnosis

Part 1: Problem Diagnosis

• What does the main character need to do?

• What is the major uncertainty of the case?

The main character needs to find a solution to the pivotal problem as to whether he should consider a pay raise for his employees or not.

The major uncertainty of the case is that whether the main character should consider giving raise to everyone, no one or the hard-working
minority who are worthy recipients of the raise owing to the dedication they portray towards their job responsibilities.

Questions for finding the causes of the problem.

1 What is the case about

2 What can be factors for demotivation
3 What can be employee’s mindset
4 What can be the root cause of the problem

Potential concepts and frameworks to help identify causes. Example: The Leadership Styles Theories can help determine whether leadership is a
contributor to the problem.

Intrinsic & Extrinsic motivation

Equity theory of motivation
SWOT Analysis
PESTEL Analysis
Introduction to Business
Business Case: ‘A Zero Wage Increase Again’
Student Name: Shubham Kaushik

Possible Cause #1: No wage increase in last 2 years.

Facts/Evidence How Cause Connects to Problem Short Term Steps Long Term Steps
Dilemma in wage review process. Demotivates the employees. Identifying the reward worthy Rewarding the employees with
employees. wage increase.

Possible Cause # 2: No motivation to report the job on time.

Facts/Evidence
Dougie taking regular leaves on
Monday’s giving medical reasons.
How Cause Connects to Problem
Shows the minimalistic
seriousness of employees
towards their job.
Short Term Steps
Connecting with Dougie/similar
employees and explaining them
the consequences of their
actions.
Long Term Steps
Identifying laid back attitude
employees & issuing warnings.
Terminating them in extreme
cases.

Possible Cause #3: Lack of dedication towards job.

Facts/Evidence How Cause Connects to Problem Short Term Steps Long Term Steps
Marie & Anne refraining from Lack of dedication is a by-product Weekly/ bi-weekly review Penalizing employees with too
helping a customer of demotivation in employees meetings. many instances of not adhering
job responsibilities.

Possible Cause #4: Some employees performing better than others lacking recognition.

Facts/Evidence
Aaron and Wesley showing
utmost seriousness towards their
job.
How Cause Connects to Problem
Some employees are motivated
internally to conduct their duties
seriously even when no one is
noticing while others just do for
the sole purpose of completion.
Short Term Steps Long Term Steps
Recognising hard working Rewarding hard working worthy
employees in review meetings employees.
and appreciating their efforts.
Introduction to Business
Business Case: ‘A Zero Wage Increase Again’
Student Name: Shubham Kaushik

Possible Cause #4: Some employees performing better than others lacking recognition.

Facts/Evidence
Kyle working hard to prove his
dedication compared to some
tenured employees not caring
enough about their
responsibilities.
How Cause Connects to Problem
Kyle despite being a new
employee is working hard to
prove his dedication and should
be recognised and rewarded.
Short Term Steps Long Term Steps
Appreciating Kyle and similar Rewarding with incentives or/and
employees in review meetings. upgrading the designation

What is the problem?

The company is dealing with a recessionary phase that is creating a dilemma as to whether it should give a pay raise to its employees this year
as there has been no wage raise since last 2 consecutive years. The owner is finding it hard to decide as to whether he should cut his
operational/other costs to give a pay raise or not. If yes then to either a minority of hard working employees or everyone.

What are the major causes?

1) There has been no wage increase in last 2 years.

2) There is lack of communication between the stakeholders and employees.
3) There is lack of internal and external motivation to the employees.
4) Some section of employees is working very hard to sustain dignity of the company while others are inflicting a laid back attitude.
Introduction to Business
Business Case: ‘A Zero Wage Increase Again’
Student Name: Shubham Kaushik

Part 2: Writing a Problem Diagnosis Essay

Definition of Problem There has been no wage raise in the company since last 2 years due to recessionary phase which has
developed a feeling of demotivation within the employees.

Summary of Major Causes Lack of communication, recognition and rewards has rendered a major part of employees to become
demotivated and not perform their duties with utter seriousness.

Evidence Proving Diagnosis

Criterion 1
a. Dilemma in wage review process.
b. Dougie taking regular leaves on Monday’s citing medical reasons.

Criterion 2
a. Marie & Anne refraining from helping a customer

Criterion 3
a. Aaron and Wesley showing utmost seriousness towards their job.
b. Kyle working hard to prove his dedication
Introduction to Business
Business Case: ‘A Zero Wage Increase Again’
Student Name: Shubham Kaushik

According to me Mark should develop a detailed plan to increase wage of only promising employees and communicate with others discussing
the factors that contributed to a no increase in pay of other ones.

State your action plan goals.

• Making detailed plan about SWOT analysis of the company.

• Effective communication with employees via regular meetings.
• Recognising and appreciating the hard-working employees.
• Rewarding the performance oriented and dedicated employees to instill a sense of trust and loyalty towards their job.

Short Term

▪ Regularly working on SWOT analysis of the company.

▪ Communicating with employees via weekly/bi-weekly meetings.
▪ Recognising and appreciating the hard-working employees.

Long Term

➢ Rewarding the performance oriented and dedicated employees with wage increase to instill a sense of trust and loyalty towards their
job.
Introduction to Business
Business Case: ‘A Zero Wage Increase Again’
Student Name: Shubham Kaushik

Major Risks

o Some employees might not take rewarding only minority employees in a good sportsmanship and might leave the job.
o Some employees might argue about the frozen wages as their reason of their sluggish attitude towards their duties.

Mitigation of Risks

Employees who lack sense of internal motivation and seriousness towards their duties usually argue about them not being rewarded
and might also leave the job. In this case effective communication and counselling can help a lot to motivate them. At times
appreciation can also work wonders. In the worst case even if we loose them, we will be better off in retaining employees committing
greatest effort towards their job.