Crepin's Management of Norwest - Case Study Example

Topic: Case Study (Crepin Management of Norwest) CREPIN MANAGEMENT OF NORWEST Norwest Labs, founded by Jean Crepin is a company with a history that educates and inspires many other entrepreneurs. When he first came to Canada, he did not have much capital to start with. Crepin was hired by the University of Alberta to work as a technician in a soil and feed laboratory. While working here, his mentor who was a highly respected soil scientist inspired him to pursue a Bachelor of Science degree, which he did. He and several other fellow scientists from the University of Alberta established Norwest Soil Research Limited in 1975. It was meant to conduct soil reclamation work on a contract basis for Syncrude Canada Limited. Crepin and a friend then obtained bank loan to purchase the shares of the scientists. He became the president of the company, which continued operating under the name Norwest Labs. Having started out as a simple company, Crepin was in total control and gave directions on how the company runs. At the time, it was easy since the company did not have a complex administration. However, as time went by, he started having new ideas and wished to implement them with the hope of benefiting both the employees and the company. He set out to make some changes, which affected the company on various levels in terms of profits and losses and the relationship between the administration and the workers. 1. What are Crepin’s current concern and goals Crepin understands the value of growth and expansion to his company. He wants to make Norwest able to perform new research. He also wishes to adopt new testing applications so that his corporation can continue growing. In order to ensure a continued and substantial growth, Crepin also wants to change the mode of administration in his business. He had been the sole administrator whose ideas were the basis of how the organization performed. However, with the expansion vision, he understands that in case he is gone, it might be challenging for those left behind to continue running the corporation. He also sees that with expansion it will be difficult to run every aspect of the organization on his own. He therefore added another goal of changing the mode of leadership. He wants a company that has new philosophies that come from sharing of fresh ideas. With the competition in the market, Crepin does not want to be left behind. However, in order to achieve this, there are also the basics that he needs to accomplish. Hence, another one of his goals is to change the Employees attitudes towards the business (Kruse 2010). Crepin wants to ensure that there is operational harmony to increase efficiency of work done. 2. What has Crepin done so far towards his goal of transforming the organization The first step Crepin takes towards transforming his organization is applying for a government service program whose purpose is to assist companies in adjusting their workforce. This enables the companies meet future organizational needs the program provide funding and consulting services. He is accepted and the company engages a consulting firm to complete and operational management review. The review is meant to assess the needs of the workplace, which have risen because of changes from both within the organization and from the industry as well. The results of the consultant review shows that the greatest strength of Norwest is its employees’ commitment to the organization. However, this workforce had some concerns since they were not sure about the future direction of the company (Roslender 1992). There was also decline morale, the company run on a confused system of administration and among others, the employees did not have trust in the administration. As a result of these findings, the consultants offer Crepin recommendations that are aimed at solving these issues. He would first have to hand over his power and control to his employees, which is to delegate decision-making. He also has to come up with a new reporting structure that has centralized corporate services that need to be put in place. This is what guides him into taking his next step of setting up centralized corporate services. He started with the departments of accounting, marketing information system and quality assurance. He hires some managers for these departments from outside while others come are promoted from within the company to fill these positions (Hardaker 2005). These new corporate services report directly to Crepin. Unfortunately, the employees do not take these changes too well as they feel that their independence is being taken away. The third step is the company to gain sharing. Crepin finds the idea of sharing the success of the company appealing. Although he had dismissed it earlier on after being discouraged from it by more experienced CEOs, he now regarded it in a new light. After seeing, the effectiveness of gain sharing the behavior of employees become largely debated by management writers, he reconsiders implementing it in Norwest (Long 2010). Crepin learns that some of the positive effects of the gains sharing method include improved performance of employees, change in employees’ attitudes, better quality and improved productivity environment and better use of materials answer supplies. He realizes that the key element for a successful gain-sharing plan is the connection between the employees reward and company’s performance. After consulting with Jack Stack who had improved his company using the gain sharing method, Crepin decides to implement the gain sharing method (Levine 1990). Once more, the employees do not openly accept the idea of gain sharing instead of the bonuses the employees were used to. However, this is partly due to their lack of understanding of how it works. 3. Has Crepin been successful so far Unfortunately, Crepin was not successful at fully implementing his ideas since the employees were not business oriented. They objected to most of the new ideas and were more focused on how much they would make from a proposal like the gain sharing instead of trying to understand the benefits it would bring to the corporation as a whole. The employees did not want their culture to be altered and were in conflict with the new management (Kruse 2010). The timing was also on the downside due to the impending deregulation and the huge amount of loss experienced in 1993/1994. The management was not in harmony with the employees. On the other hand, the employees were still not independent minded and still came to him for instructions. The turmoil he encountered made it difficult to implement all his plans at the time. Despite the numerous challenges that Crepin faced when he first started implementing changes in the administration of the company, he end up achieving making Norwest a success. He learned from the mistakes he had made while trying to bring changes and understood different methods of running his company. He is currently a well-respected agrologist and successful entrepreneur and recognized as the founder, president and CEO of Norwest Labs (Tyler 2005). This is Western Canada’s largest agricultural and environmental laboratory, a success so far worth acknowledging. 4. What are your thoughts about the gain sharing proposal at the time The idea of gaining sharing of the successes of the Norwest, which was a growing business, was a wise proposal. This type of incentive pay linked directly to the important measures that determine performance was a good idea because it also motivates a company to improve on its performance. For more people to accept the products and services of Norwest, they would have had to have developed faith in the company. This would be examined through analysis of their performance. The workers will also be motivated to work harder for the success of the company so that at the end of the day they can reap a higher bonus. It also promotes team work among the employees so that they can increase the productivity of the firm and earn more. In the process, the owner of the business benefits greatly since as the workers put more effort for quality performance and higher output, the business continues to grow as a whole. It was an idea aimed at the development of the business and increase in its output Hardaker (2005). The proposal would also bring about coordination between the different departments within the organization and the hostility would end. 5. What could Crepin have done differently to achieve his goal Perhaps it is wiser to inform the new hires about the culture of the business and train them on the internal rules and policies. This can aid them in avoiding conflict the new employees as they try to revolutionize a company. However, it would have been better for the corporation if Crepin had relied on internal hiring. This would have ensured that Norwest retained most of it top performers and given them more chances for promotions. It would also have reduced the hostility felt by the employees towards new governance which they felt was depriving them of their freedom. He should also have issued clear goals and objectives to the new corporate services and managers. These goals would be set slightly above the achievable level and bonuses would be proportioned to one’s effort. Each individual should then be educated on the process of how the bonuses set would be issued and after how long. They should also get to know the advantages of each implementation (Levine 1990). This means that a coaching and evaluation process so as to emphasize on pleasing behavior among the workforce. Seeing as the failure was as a result of the employees’ ignorance on the process of gain sharing and a new type of evaluation. Perhaps if they had been educated about how this process worked and how it benefited both the employees and the business they would have been more receptive to Crepin’s ideas. He should have first addressed the issue of the old bonus plan and acknowledged its major flows before implementing a new one. Since it is wise for the choice of reward system to involve the employees, Crepin should have gain sharing an option to them. For instance, the bonus plan could have been set in a cafeteria-style benefit plan. This would enable them choose if they preferred to join it or pass in exchange for higher salaries (Kruse 2010). These few things would have made the employees open to new ideas of how the business was operated and made them feel that they were contributing to the rapid changes taking place around them. In conclusion, every business idea has different impacts on a business. Without change, a business cannot progress since it is not keeping up with the competition. Crepin was trying to come up with a plan that would ensure the Norwest Company would not be left behind as the competition grew stronger. He wanted to expand the business and improve the employees’ attitudes towards the administration. The only problem was his approach to the matter. He was too focused on implementing his new ideas that he did not pay much attention to the process required to implement them effectively. Crepin’s ideas were with the best of intentions. However, the business still emerged s a success as along the way he learned what entailed of proper management. It is important to note that each business encounters its own challenges. This should enable the administrators figure out a reliable method of fixing the problems. They should not be rush in implementing their ideas but should take time to perform a research and find out how best to incorporate the changes without alienating the workers. A business is a risk and it takes other risks to keep it successful. Crepin did not give up on Norwest Labs, which shows that it is possible to overcome the challenges that come with change. References Kruse, D. L., Freeman, R. B., & Blasi, J. R. (Eds.). (2010). Shared capitalism at work: Employee ownership, profit and gain sharing, and broad-based stock options. University of Chicago Press. Levine, D. I. (1990). Participation, productivity, and the firms environment. California Management Review, 32(4). Hardaker, S., & Fill, C. (2005). Corporate services brands: The intellectual and emotional engagement of employees. Corporate Reputation Review, 7(4), 365-376. Tyler, T. R., & Blader, S. L. (2005). Can businesses effectively regulate employee conduct? The antecedents of rule following in work settings. Academy of Management Journal, 48(6), 1143-1158. Roslender, R., & Dyson, J. R. (1992). Accounting for the worth of employees: a new look at an old problem. The British Accounting Review, 24(4), 311-329. Long R. J (2010). Strategic Compensation in Canada (4th Ed). Toronto: Thomson-Nelson. Read More