Meglith case study

Megalith, Inc. is a large company with a long and consistent history of growth and profitability. Their Finance Group has grown drastically in number of employees - almost doubling - and the manager, John C. Boyd, has made special efforts to recruit young, talented managers, and to pay them as well as possible. Despite receiving the highest compensation possible under company policy, two of Boyd's top four people have left recently for higher paying positions.

Boyd wants to raise pay for the two he still has to the point that they will not be open to outside head-hunters, and so that he will be able to attract quality recruits to fill the two positions he now has open. However, the head of Human Resources- Ed Rogers refuses to allow any exceptions to the company pay scale, and claims that he is already offering industry standard. Megalith has brought in an outside consulting firm, Personnel and Organizational Psychologists, Inc. , to conduct a climate survey. That firm administered Deci and Ryan's General Causality Orientations Scale (GCOS) to seventy Megalith managers.

The GCOS has scales measuring three causality-related personality constructs, related to Deci and Ryan's Self Determination Theory (SDT). The Autonomy scale is a measure of the individual's attraction to situations which foster intrinsic motivation, the Control scale measures the person's tendency to orient their behavior in terms of external factors, such as rewards, and the Impersonal scale measures the extent to which the person believes that they can control outcomes by their own actions, or whether "luck" or "fate" controls what happens in their lives. Results

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Megalith sample consist a total of 70 managers from different pay categories. These managers and were administered on GCOS scale measuring autonomy, control and impersonal. Table 1 demonstrates the frequencies based on pay categories that determine the number of managers in each pay category. Maximum numbers of managers (34%) belong to slab of $50-$70, with the least (19%) being in slab of $100-$150. Figure 1 displays a graphical presentation of the same. Table 2 shows the Descriptive statistics for 70 managers for GCOS and Pay Category stating the means and standard deviation. Read more about Tanglewood Case

Table 3 displays the comparison of national norms for private-sector managers to the results of the survey at Megalith. As can be seen, the mean values for Megalith is higher in scales of autonomy and impersonal except for control scale, which is much below the national norms. It shows that managers perceive being controlled in the organization. In a controlled environment, employees' exhibit behaviors in terms of external factors such as rewards, deadlines, structures, ego-involvements, and the directives of others.

Figure 2 shows the graphical presentation of the comparison between means of national norms and Megalith survey results. Correlations were run on the scales in Megalith sample to rule out any possibility of collinearity, and found no significant correlations, except for a strong negative correlation between impersonal and autonomy. The results also showed that there is a positive correlation between control and impersonal. (Table 4). Table 5 shows Analysis of Variances between GCOS scales. It shows that none of the scales are significant.

A multivariate Analysis of variance was conducted to test if the scores for GCOS differ by pay category. None of the scores displayed significance. (Table 6). Table 7 displays Test of Between-subject effects where Pay Category being the independent variable and GCOS scales the dependent variables. It again proves that none of the facets are significant.

Discussion Current Megalith managers do not differ much from the national norms except for the control scale which is much below the national norms.

Controlling events are those in which employees experience pressure to think, feel or behave in specified ways and thus facilitate external locus of control (rewards, avoiding criticism from the superior). And so, evaluation may be experienced as a pressure, and thus the controlling. According to Carlopio and Gardner (1995) employee perception of control and influence has a significant effect on job satisfaction and turnover intentions. Handy concluded, "Too much control is expensive, time-consuming, and self-defeating in motivational terms". Thus the "control" facet seems to be affecting motivation of employees.

Efforts to build relationships and to treat workers as equals will help motivate them. According to Tourish and Hargie that talks about effective leadership states that 'autonomy with need satisfaction are necessary for work motivation and positive attitude towards workplace'. Moreover, the interpretation of strong negative correlation between impersonal and autonomy can be that; though managers display initiation and interest in the work, they believe that the desired outcome is not in par to their expectation. This makes them anxious and perceives them to be ineffective.

This in-turn leads to amotivation, the root cause of which could be lack of transparency in communication. Additionally, controlling environment and authoritarian leadership will promote control, impersonal orientation and external motivation on one hand, while on the other hand; informational environment will promote autonomy orientation and intrinsic motivation. Relationship closeness via egalitarianism, communication of plans, and interaction will also have large positive effects on such aspects of morale as pride in work and organizational commitment, which, consecutively relates to employee loyalty.

According to Deci and Ryan(2000), four factors that make event informative are: first, opportunity to make choices; which means absence of unnecessary control, second, availability of efficient relevant information concerning optimally challenging activities, third, conflicts with personal needs or feelings must be acknowledged and fourth, a sense of belonging or feeling of relatedness. To create an informational environment to contribute to employee satisfaction, the leadership ways of communication are essential in order to increase the intrinsic motivation and job satisfaction.

To add on, there is a relationship between employee perception of work climate and supervisors' managerial style (Cranmer, D. L). Also, subordinates' perception of support from the supervisor mediates positive relationships of the supervisors' POS (Perception of Organizational Support) with the subordinates' POS and performance. (Shanock & Eisenberger, 2006). The comparative national norm with Megalith norms displays dissatisfaction on control facet, that itself talks about the superior-subordinate relationship. Impersonal causality orientation predicts employee perception of work climate.

The quality of work environment, positive work culture, and employee motivation (e. g. , intrinsic and extrinsic motivation, passion, and flow) attaches perception of job satisfaction. There is an ambiguity in the leadership style that is adopted at Megalith. Leadership is defined as "a process that includes influencing the task objectives and strategies of an organization, influencing people in organization to implement the strategies and achieve objectives, influencing the group maintenance and identification, and influencing the culture of organization" (Jex, 2002).

There is a distinction between "management" and "leadership" and what is needed here is leader than a manager. A manager obtains compliance from subordinates and administers their duties. A leader, on the other hand, is a person who not only fulfills required administrative functions, but also inspires and motivates employees to strive for excellence, and thus improve the work culture. It seems John Boyd is more of a "manager" than a "leader" who stresses the importance in performance and results.

Employees like to work under those who are true leaders and not just be there to perform administrative duties (Jex, 2002). If Megalith has to survive and be successful, there has to be a presence of real leaders and not just managers. Adopting "Path-Goal Theory" of leadership style that blends leadership with employee motivation to achieve success can be functional in the current scenario at Megalith. According to this theory the leader should be able to adapt his or her leadership styles into

(1) directive leadership,

(2) Supportive leadership

(3) Achievement- oriented leadership and

(4) Participative leadership.

(1)Directive leadership focuses on clarification of task and roles, by meeting the employees regularly and chalking out responsibilities.

(2) Supportive leadership represents behaviors that are aimed to show concern and care for employees.

(3) Achievement-oriented leadership is aimed at helping employees to improve performance.

(4) Participative leadership involves getting inputs in work-related matters. Additionally, there is no information available about the two managers who have resigned, except for their statements that they were leaving for significantly better-paying positions.

They had been recruited in Megalith for the sole purpose that they were innovative and achievement oriented. It is quite possible that they have been attracted by substantial pay offer by competing organization. After all, it is the talent and abilities that are traded in the bazaar. According to Lee, Sheldon and Turban (2003) personality trait does influence performance and satisfaction. Likewise, dispositional attitudes such as PA (positive affect) and NA (negative affect) also relates to job satisfaction. (Anderson, Ones, Sinangil & Viswesvaran, 2002).

The personality traits and the dispositional attitude of managers who resigned are unknown. Conclusion The conversation between Ed Rogers and John Boyd indicates that the employees are paid handsomely but there seems to be a loop in the leadership style that is adopted. A dyadic leadership style is a strong predictor of turnover (Ferris, 1985). Three constructs that lead to effective leadership are:

1) share plans and strategies with employees,

2) interact with employees frequently in a face-to-face manner, and

3) remove the structural barriers that create social distance between management and workers.

Based on our results, these steps alone will have significant potential for improving morale and harmonious teamwork in the organization. It would be easier to recommend if an additional job-characteristics oriented measure, such as Job Descriptive Index would be applied to the same managers. It might also be helpful if the managers are individually interviewed and have a one-to-one discussion, for which, John Boyd feels who are crucial managers to the organization.

If there is widespread dissatisfaction with pay, Megalith might do well to revise its compensation policies, although the highest achieving managers seem to be oriented more towards Autonomy. The results of the JDI could be used to redesign the top management positions to provide more opportunities for high-Autonomy individuals to function in compatible ways. However, before taking any action it would be wise to get a more detailed picture of the situation.

It is also important to keep the less-than-stellar managers happy, since the success of the enterprise also depends on having second-tier people to carry out the vision of the leaders. Again, more flexibility might be called for towards the compensation policies. In any case, a large company must always strike a balance between the necessary bureaucratic stability and the flexibility needed to succeed in markets which are changing ever-faster. If Megalith wishes to continue its growth, it would do well to strike the balance a little more in favor of flexibility and implementing appropriate leadership style.

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