MBA Case Study

CASE STUDY
ESSAY

This Case Study is part of the application process for the 2022 full-/part-time MBA programme at Frankfurt School of Finance & Management. Please carefully read the
article from Financial Times on the following pages and answer the question below in the field provided. Please write no more than one page (500 words).

Applicant Name ...............................................................................................................

Date ..............................................

Please read the attached article by Pitta Clar from the Financial Times.
What are the main take-aways?
Do the arguments listed in the article match your own opinion and/or experience ?
Do you think the problem of “staff shortages” is a temporary, post-Covid phenomenon, or here to stay ?

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Bachelor-Programme
MONEY ISN’T EVERYTHING IN
THE GREAT RE-EVALUATION
Financial Times
3 October 2021
A meeting with a group of manufacturing company executives cannot be
guaranteed to surprise, but I recently found myself in a gathering that did exactly
that.
The managers came from a mix of businesses. Some made cars, one made
fertiliser, others produced steel or glass or perfume.
All present were troubled by the Covid-related shortages that have struck supplies
of everything from computer chips to Ikea mattresses. The lack of workers in what
has been called the Great Resignation was also vexing.
More striking though, was what was said about the prospective shortage of
employees, especially younger ones, once the pandemic ends.
“We need to revolutionise the way we make roles in manufacturing appeal to
younger generations,” said one executive from a global company with thousands
of employees. “If we don’t, we’re not going to have a workforce to make our
products.”
Most staff at this company did not have the luxury of worrying about whether
they could work from home or not. They did shift work on a production line in a
hot factory. Isolation was common, so was staff turnover at a time when, as the
executive said, “there are so many other options out there”.
Factory owners faced a staff crunch well before Covid struck. Studies as far back
as 2018 predicted US manufacturers risked a shortage of 2.4m workers before
2030, largely because of the industry’s “negative perception” problem.
But sitting in that meeting, I was reminded of the advice Joe Biden offered
recently when he was asked about labour shortages that have left US businesses
struggling to find workers: “Pay them more.”
Would it help, I asked the manufacturing executives, if they simply paid young
people more? Not as much as you might think, I was told.
As one person put it, pay is obviously relevant but it is “absolutely not the kind of
incentive that it’s been for older generations for many decades and we can’t rely
on it”.
The manager said this was already the case for millennial workers, the oldest
of whom turn 40 this year, but was even more apparent among the so-called
Generation Z employees born since 1997.
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The idea that pay is not everything is not new. The influential American
psychologist, Frederick Herzberg, showed in the 1960s that pay rates are a
“hygiene factor” that do not foster job satisfaction by themselves, but prevent
dissatisfaction — just as good hygiene does not cause good health, but will cause
disease if lacking.
Still, if attitudes to pay are shifting, it has profound implications for employers, and
not just factory owners.
It would also chime with what might be called the Great Re-evaluation of working
life that the pandemic seems to have spurred for some employees.
A striking 15m-plus Americans have quit their jobs since April, and 40 per cent
of employees in the US, Australia, the UK, Canada and Singapore say they are
at least “somewhat likely” to quit within the next six months, a McKinsey report
showed last month.
Worryingly for employers, nearly two-thirds of those thinking of leaving say they
are ready to go with no new job in hand.
Tellingly, pay was not the main reason cited for jumping ship. Rather, the top three
factors people mentioned were feeling undervalued by their organisations, or by
managers, or not feeling as if they belonged.
So what is the answer? Several executives cited more autonomy, more
recognition, more flexible hours, better holidays and anything that generally made
working life more enjoyable.
I suspect they are correct, especially after speaking last week to Sophie Munn, a
34-year-old digital marketer at consumer goods group Unilever.
Four years ago, she was on the verge of marrying a school teacher who had two
months off in summer, when she decided to take advantage of Unilever’s unpaid
leave scheme.
It allows UK staff to take up to six months and return to either their old job or an
equivalent role, without leaving their pension plan or losing other benefits.
As a result, Munn’s planned three-week honeymoon turned into two months of
travel, from Bali to Borneo and California, that left her feeling grateful and with
firm views on the significance of pay. “Salary is important,” she said. “But I want
to live my life. ”
Pilita Clark
Source: © 2021 The Financial Times Limited All rights reserved. 2021