To: CEO Gibson’s Furniture
CC: All Departmental Managers
From: Manufacturing Manager
Date: 16th June 2020.
Subject: ETHICAL CULTURE
Introduction
Ethics and organizational culture have a massive impact on business success. Business culture is generally described as corporate values that show commitment, compliance with the ruling of law and departmental rules, and integrity—business culture results in the formation of its ethics with time. In every business, cultural attitude, perspective, relationships, and past occurrences result in outstanding business ethics. Therefore if the stated factors are negative, they result in unethical standards in the business. On the other hand, if cultural factors are positive, the company will form a positive business culture.
Management-employee Issues
In Gibson’s Furniture Company, there have been complaints of management and employee relations. As a result, many employees have quit their jobs. I researched the issue and found out there have been complaining about several topics. Some of the matters highlighted include employee harassment, overworking, and late payment. In the past two months, the company has lost more than 20 employees in all departments. Also, the business is continuously advertising for work and training newly recruited employees and losing experienced ones. From the analysis conducted last month, the company spends a lot of its earned profit on employment and training.
A current analysis of business performance shows compared to our competitors shows the company is being left stagnating while the performance of others increases significantly. Compared to five years ago, other furniture manufacturing and selling businesses have overtaken Gibson’s Furniture Company and now seem to be doing better. Comparing them to Gibson’s, there is one clear thing, and our turnover ratio is very high. Having a new employee now and then means the company has to continually start from zero. As a result of losing experienced personnel, the company falls short of creativity and quality.
Solutions
I have several suggestions that would help improve our performance and lower the employee turnover ratio. According to the records, when the organization was still small five years ago, the turnover ratio was less than one percent per annum. The company fame rose due to the production of quality products which led to its growth. The company needs to return to that culture to ensure employees are taken care of to avoid a high turnover ratio. Some of the methods that could be applied are introducing an HR department, ensuring payments are made on time, and management relations with employees are improved.
Introducing a human resource department will ensure all concerns of the employees are addressed. Also, the department will help connect employees and management. An HR department is essential since it helps resolve any conflicts between the employers and junior employees. Research shows that satisfied employees are less likely to leave their current employers. Through this, the company can save all the money spent on training new employees and looking for new ones as a result of a high turnover ratio.
Another solution ensuring the payments are made on time depending on employee contracts. Ensuring employees receive fair wages and on-time will enhance better relations with management. Most of the employees expect their employers to deliver payments fairly and without any delay. In case of any delay, the employees should be informed on time and be given a reasonable explanation. This measure ensures the employees feel like a part of the organization since they are kept in the loop. An employee has a right to a fair and timely wage, as stated in the organization’s policy. Therefore, Gibson’s keeping their part of the deal will ensure that all employees are satisfied and focus on improving their quality.
The other measure is improving employee and management relations. Any organization with smooth relationships among all stakeholders ensures better performance and peaceful co-existence among everyone. Therefore, all departmental heads and organizational heads should ensure their employees feel free to express their views and concerns regarding any issue that the management should work on. This includes favoritism, exploitation, overworking employees, among others. Therefore a proper mode of extra shifts and payments should be organized in all departments. Better relations will help ensure there is a peaceful environment for work. Thus employees will be motivated to work at Gibson’s, and hence performance and quality will improve significantly.
Conclusion
Business culture and ethics are essential contributors when it comes to success. Therefore ensuring the business culture results in good work ethics in the business together with its stakeholders will improve business performance. For some time now, the issues affecting Gibson’s Company have resulted in a high employee turnover ratio, performance stagnation, and depletion in quality. Addressing these issues will help improve the organization and stay relevant despite the fierce competition. Some of the measures that can help improve the business include; introducing a human resource department, ensure employees get fair wages, and receive them on time, and there are better employee and management relations. These measures will ensure the set standards of the organization, and the rule of law is obeyed. Making sure the employees are in a comfortable working environment where their needs are taken care of will result in improved business performance and quality products.
References
Conrad, C. A. (2018). Tools of Ethics for Management. In Business Ethics-A Philosophical and Behavioral Approach (pp. 185-326). Springer, Cham.
https://link.springer.com/chapter/10.1007/978-3-319-91575-3_7
Alvesson, B., Alvesson, M., Bridgman, T., Willmott, H., Andersen, A. A., Andersen, M., & Walther, M. (2017). Abrahamson (1997) Abrahamson, E.(1997). The emergence and prevalence of employee management rhetorics: The effects of long waves, labor unions, and turnover, 1975 to 1992. Academy of Management Journal, 40, 491–533.
https://www.emerald.com/insight/content/doi/10.1108/S2059-65612017008/full/html