Hausser Food Products Company Case Case Study

Problem Statement/Introduction of the Case Problem

Hausser Food Products (HFP), an infant food manufacturer, has seen a set of strategic leadership issues preventing organizational success. Decreases in sales growth and the underutilization of HFP’s physical assets, such as warehouses, are exacerbated by the sales team’s unenthusiastic approach to idea generation when it comes to the optimization of HFP’s selling strategies (Capon, 2012). HFP’s likely core issue refers to the innovation rewarding system’s inadequacy and the lack of consideration given to the rewarded idea’s profit-maximizing potential. The solution should involve new leadership competency development (active listening) and the instrumentalization of employee expectation knowledge as a leadership resource.

Analysis

The aforementioned issue’s first component pertains to the ineffective combination of the sales team’s focused work with the management’s inability to set rewards that would gain positive reception rather than causing a sense of injustice. On an annual basis, HFP engages in a four-stage sales plan formulation process, with clear sales targets available to the sales team and Florida sales professionals’ relatively high degrees of operational flexibility and freedom. Nevertheless, the company resorts to a combination of relatively low base salaries and more generous bonus payments distributed among team members in case of reaching the set objectives (Capon, 2012). Worse still, HFP’s suggestion-related plan sets $500 as the largest possible bonus per person for an innovative profit-generating idea, which has met hidden resistance from the Florida team. Particularly, A. Siegel voices concerns over the plan’s injustice since even the ideas capable of adding $200.000 to HFP’s annual profits would not bring their originators more than $500 (Capon, 2012). As these facts and reactions reveal, the employee-perceived inadequacy of HFP’s innovation motivation methods represents a pronounced problem.

The second component is the executive team’s lack of employee disposition/expectation knowledge to implement, stemming from the insufficient implementation of active listening and feedback processing leadership skills. Strategic leadership, being the accurate and timely implementation of various levers of influence to inspire stability-generating decisions at diverse hierarchical levels, promotes organizational success by ascertaining both financial health and orientation at long-term achievements (Gusmão et al., 2018). Human capital development permeates this leadership form, and HFP’s lack of appreciation for the sales team’s perceptions of just reward allocation undermines this aspect of leading strategically (Capon, 2012; Gusmão et al., 2018). The case text does not list any facts pointing to HFP’s attempts to collect and instrumentalize sales representatives’ feedback on the actual suggestion reward plan and reconsider the innovation reward size. As a result, not willing to share their profit-generating insights regarding senior citizens’ demand for HFP’s products, the Florida team has started generating profits from that without sharing the finding with the executive team (Capon, 2012). These tendencies can be demonstrative of the lack of trust between the hierarchical levels created by the management’s low effort in exploring sales representatives’ moods.

The trends explained above cause the mismatch between the size of financial rewards for innovative sales improvement ideas and these effort-intensive propositions’ actual capacity to generate revenues, thus creating the strategic management mistake to be resolved. In communication with the representative of the regional sales department, Mrs. Cooper, the Florida team has openly critiqued the disproportion of the idea’s effectiveness and the reward size (Capon, 2012). It implies the employees’ hope for the system’s greater flexibility in the future.

Solution

Firstly, Mrs. Cooper should resort to active listening skill development/implementation and employee feedback/knowledge generation as alternatives to the previously practiced directive leadership and planning. Along with the trait leadership approach, socialized power motivation facilitates successful leadership and employee satisfaction (Yukl et al., 2018). Since HFP’s managerial employees are excessively demanding when it comes to sales representatives, Mrs. Cooper should strike the right balance by practicing active listening or employee needs acknowledgment, which will promote sales rep satisfaction by enhancing the managerial team’s socialized power (Kuknor, 2019). Feedback processing is another leadership skill to create employee knowledge; conducting an anonymous survey of sales representatives prior to the salary review phase is a cost-effective knowledge generation strategy to pursue (Mittorp, 2022). Mrs. Cooper should implement a survey asking the sales team to quantify their satisfaction with base salaries and assess whether the sales plan is realistic. They should also evaluate the idea of making reward sizes for suggestions equal to a certain percentage of income that it generates rather than a sum not exceeding $500 and propose their desired percentage.

Secondly, implementing the sales representative attitude and expectation data generated in the previous step, Mrs. Cooper should advocate for changes to the reward system, including base salary raises or implementation of a progressive reward size calculation system for innovative suggestions. Following these steps might require the expression of intellectance, which is a Big Five trait correlated with the leader’s open-mindedness and being oriented toward learning (Yukl et al., 2018). Generally, around 56% of employees consider their salary levels to be suboptimal, implying that Mrs. Cooper’s advocacy efforts will be met with support and appreciation from the team (Mittorp, 2022). Comparing the desired suggestion reward size against HFP’s financial situation will be required to come up with a realistic reward size calculation formula.

Justification

Reliance on employee research in sales representatives and reward system optimization efforts:

• HFP sales professionals lack interest in proposing novel selling approaches (Capon, 2012).
• Financial barriers to employee motivation at HFP: the fear of being “used” and receiving overly moderate rewards for meaningful contributions to HFP’s financial success.
• Lack of trust between the sales team and the management (the elderly market secret): the need for open communication and socialized power enhancement.
• Employee survey research and in-person communication for data collection: the demonstration of the management’s readiness for open communication.
• Employee satisfaction with creativity reward patterns creates a climate for innovation (Ali et al., 2021).
• Managerial active listening influences employee loyalty and motivation by reducing subjective job insecurity (Kriz et al., 2021).
• Reward satisfaction increases intrinsic motivation to engage in effort-intensive activities, which could apply to innovation (Thibault Landry & Whillans, 2018).

Mrs. Cooper as the appropriate advocate for change:

• She serves as a link between sales practitioners (district managers, representatives) and the board of directors (Capon, 2012).
• Optimal hierarchical position to conduct employee disposition research and present the reward size problem with evidence to the director of sales for further dissemination/discussion.

Summary

Sales representatives’ dissatisfaction with the reward system, especially suggestion rewards, limits the team’s creative potential in optimizing selling methods, calling for changes to HFP’s strategic leading and leadership skills. The solution involves exploring the sales team’s needs through listening skills and initiating knowledge generation via survey research. Another viable method is integrating employee-proposed reward size calculation practices with HFP’s factual compensation capacity to propose a progressive innovation reward determination process that would be realistic and feasible. The methods are anticipated to boost the sales team’s motivation by removing financial and psychological barriers to sharing promising sales ideas with the management.

References

Ali, A., Wang, H., & Boekhorst, J. A. (2021). A moderated mediation examination of shared leadership and team creativity: A social information processing perspective. Asia Pacific Journal of Management, 1-33. Web.

Capon, N. (2012). Hausser Food Products company. Columbia Business School.

Gusmão, F. D., Christiananta, B., & Ellitan, L. (2018). The influence of strategic leadership and organizational learning on organizational performance with organizational citizenship behavior as an intervening variable. International Journal of Scientific Research and Management, 6(4), 124-131. Web.

Kriz, T. D., Jolly, P. M., & Shoss, M. K. (2021). Coping with organizational layoffs: Managers’ increased active listening reduces job insecurity via perceived situational control. Journal of Occupational Health Psychology, 1-11. Web.

Kuknor, S. (2019). A study on effectiveness of communication in employee motivation. SAMVAD: Sibn Pune Research Journal, 18, 47-53. Web.

Mittorp, K. D. (2022). How to make sense of employee survey results: A practical guide for managers and HR professionals. Burghley Books.

Thibault Landry, A., & Whillans, A. (2018). The power of workplace rewards: Using self-determination theory to understand why reward satisfaction matters for workers around the world. Compensation & Benefits Review, 50(3), 123-148. Web.

Yukl, G. A., Gardner III, W. L., & Uppal, N. (2018). Leadership in organizations (9^th ed.). Pearson.