The Case Story Synopsis
Organization Overview
The organization, called Scorecard, Inc., is a privately owned company that manufactures and sells a range of sporting goods for games and practice, including products for such sports as football, soccer, baseball, basketball, tennis, and hockey. Furthermore, Scorecard, Inc. is a mid-sized organization. The mission of the company is directed towards providing customers with high-quality, made-to-order equipment for various leagues, including professional, collegiate, high school, junior, municipal, and pee wee.
The company’s owners value the quality of the products and steady financial growth. Moreover, both customer relations and employee job satisfaction are considered to be highly significant to the company’s structure. The culture of the company is largely centered on appealing to returning customers and supporting advanced human resources management. The CEO has a vision of maintaining a “family” culture among the employees. The business’s executive team is very hands-on with the manufacturing process.
Key Imperatives and Structure
The strategy of the company is directed towards slow and steady progress, which the CEO, Peter Wolfe, has been maintaining for the last thirty-five years. Scorecard, Inc. finds that stable yearly growth is what kept the company on the market for those years. The company rejects any propositions to be absorbed into larger businesses and remains privately owned. The main competitors on the market of sporting goods are represented by two prominent organizations, Ruth Industries, and Playoffs International.
Together, these two companies share around seventy-five percent of the total market. However, Scorecard, Inc. has a solid place in the market as well because of its steady course and a significant number of returning customers. The company’s key stakeholders include the CEO of the company, the Board of Directors, the executive management team, and the clients of Scorecard, Inc. This business is privately owned. Thus, the CEO has the right to make decisions without consulting other members of the executive team. However, the Board of Directors has some influence on choices made by the company. The executive team participates in most operations of the business, and most members have close relationships with each other.
Customers
Scorecard, Inc. prides itself on creating a network of clients that purchase their products regularly. The company’s equipment is geared towards professional and amateur players, including goods for children and adults of different categories. The presence of various levels of equipment along with the constant change of the market put the company in a strained position. However, the company’s goal to satisfy every customer with high-quality goods helps the business to have a consistent flow of clients.
Moreover, the company mostly produces goods for whole teams of players, making each collection unique. Thus, most of the sales are made-to-order, which feature products that often adhere to various specifications. Scorecard, Inc. has an approach to customers that is built on trusting relationships and high retention rates.
Human Resources Practices
Scorecard, Inc. is famous for its human resources strategy. In fact, the programs implemented at this company continuously win various rewards. The company employs approximately five hundred hourly workers and one hundred and fifty professional employees. Moreover, during the high season, the organization hires additional temporary staff. It is possible that Scorecard, Inc. has a good program of internal referral benefits as the company often has members of the same family on the payroll.
The Analysis
Currently, Scorecard, Inc. faces a problem of dealing with the fallout of an unsuccessful acquisition of the company, called Partners Marketing. The executive management team advised the CEO to consider purchasing a smaller company to broaden the assortment and gain more control over the market. All members of the team proposed their ideas and ensured the company’s owner that the benefits of the purchase would greatly affect the business’ profit. However, during the process of acquisition, the CEO and the team of appointed advisors made several crucial mistakes that resulted in them selling the new company and losing a substantial amount of money and workers. Moreover, the stability of the Scorecard, Inc. as well as internal corporate relationships were compromised.
The HRM practices of Scorecard, Inc. before the acquisition strongly adhered to the vision of the company. Wolfe, the CEO of the organization, and Flynn, the vice president of HR, discussed various approaches to advancing the human recourses management. Flynn designed a solid structure that included regular performance evaluations and supported worker’s developments. Such programs as employee education and training, economic development, health care programs, family-friendly benefits, continuous improvement were implemented at Scorecard, Inc. The company took pride in their attention to employees’ satisfaction and growth.
However, in the process of acquisition, Wolfe hired a new specialist, Dave Willow, to deal with the human resources management of Partners Marketing. Willow did not have much experience in the sphere of human resources management. Thus, he failed to implement the system that was advised to him by Flynn. The first problem that the company’s workers encountered was the lack of communication between the members of the executive board and the newly appointed acquisition team.
The CEO of the company ignored every comment from the board and decided not to disclose the information about the purchase to workers. Most members of the managing team lost their ability to influence the decisions of the company. The programs that Flynn devised and implemented in Scorecard, Inc. were not taken into account as well. This level of secrecy led to the purchase of the new company to go without any quality or performance evaluations. The focus of the Scorecard, Inc., and Partners Marketing shifted from employees to profit. Thus, Willow made changes that did not align with the company’s original vision. The leadership of Scorecard, Inc. became highly ineffective.
The new company’s policies and benefits were not up to corporate standards. There was no consistency in benefits and vacation times. Willow did not have a structured system of compensation. Furthermore, Willow failed to perform performance evaluations, which showed the level of employees’ qualifications. As a result, Partners Marketing was faced with high levels of employee turnover, which Willow did not expect.
He concentrated on hiring lower-skilled workers and providing new hires with disproportionate benefits. This situation showed a clear problem with the new company’s recruitment practices. Secondly, new employees failed to deliver the products of the quality that was expected of Scorecard, Inc. because they were not trained enough. Thus, the equipment failed on the field and clients started to demand refunds. Both Wolfe and Willow overlooked these problems and did not change their policies to adjust the hiring process and employee training. They did not create a strategic plan for absorbing the company which resulted in them pouring a substantial amount of money into the new business.
Currently, the company is dealing with the consequences of the CEO’s actions. The original executive team of managers is asked to help Wolfe with the existing problems. They salvaged the rest of Partners Marketing’s resources and sold the company.
Recommendations
Changes in the HRM Strategy
First and foremost, the company must return to its original values. Scorecard, Inc. had an excellent HRM strategy with a plethora of programs and initiatives. These programs should be implemented again and reevaluated for better performance. The company lost a significant amount of money because of the acquisition, which complicates the ability of human resources management to utilize the same strategies that were used before.
Thus, Flynn and his department should consider assessing the expenses connected to necessary programs and make cuts where they are required. For example, such programs as employee education and training are essential to the company’s effectiveness. Thus, these initiatives should be reinstated without a substantial decrease in funding. During the acquisition, Willow disregarded the importance of training, which resulted in manufactured equipment failing on the field. This mistake should not be repeated as it leads to customers not returning to purchase other products.
It is possible that the employees that worked at Partners Manufacturing would not go back to Scorecard, Inc. and would not recommend this company to other potential employees. Thus, the HRM team should devise a strategy to attract new workers and keep the retention rates high. However, they should remember to choose methods that do not require much funding. Alternatively, they can opt for non-financial advantages or benefits that do not ask for payment right away.
For example, Flynn can focus his team’s efforts on rebuilding the corporate culture and engage with the current employees to find out, which benefits would the workers prefer. The spirit of employees will become stronger if they start feeling appreciated again. The process of choosing and hiring new workers should be changed as well. The professional and personal qualifications of individuals should come first. Thus, human resources managers should create assessments that will allow them to pick the best candidates for vacant positions. The company can have a better staff that has fewer employees than before as people’s qualifications are more important than their quantity.
The programs that offer health care and family benefits should be revised to determine the best employee satisfaction to the cost ratio. Furthermore, it is possible that the company should concentrate on awarding performance rather than the time of service. These types of awards will build higher retention of hires and result in new employees performing well. Moreover, the company can save money using this method because the quality of the products is likely to go up, which will result in more clients and fewer demands for refunding.
Future Considerations and Outcomes
Some future considerations should include new purchases. While the CEO of Scorecard, Inc. seems reluctant about the idea of possible expansion, he should be reminded that it is impossible for his company to advance in the market that is dominated by two big enterprises. Thus, Wolfe should think about purchasing a small and stable business. However, the new purchase should be handled differently.
First of all, the executive board should participate in every discussion and process connected to the acquisition. The secrecy that surrounded the previous merger should be avoided. Doug Franks, the vice president of operations should gain access to the new company’s structure and manufacturing process. Joe Heyer, the chief financial officer, should look into the financial activities of the new business and assess the possibility of financial growth. Flynn and Wolfe should continue to work together to implement the HRM strategy of Scorecard, Inc. to the new company to transition new workers to the new system. All aspects are to be discussed with every member of the team to reach the best decisions.
To help an acquired business have a smooth transition, some workers that are currently performing well can be offered higher positions at the new company if they agree to mentor other employees and bring their performance to the corporate standards. Thus, the transfer of working forces between two companies should elevate the performance levels and offer some employees more opportunities for career advancement. Moreover, such integration can help with building team spirit and advancing worker’s knowledge without spending money on training courses. Career progression is important for many people. Thus, this opportunity may attract more workers to the business.
The company’s CEO should change his vision on the topic of expanding the business. Although his focus on stability gives the company an opportunity to grow slowly, the market of sporting goods requires businesses to be more flexible and responsive to the customer’s evolving needs. Moreover, the need for open discussion should also be seen as essential. The company’s executives should create a plan that will continue to promote high-quality services as well as employee satisfaction.
The growth of the business should be seen as an opportunity for Wolfe and Flynn to bring their award-winning human resources strategies to other companies. In the end, the company should not only surpass its previous goals of stable existence but also expand its practices to more locations.