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MGMT610 Assignment #4: Case Analysis (30 points) Tasty Pastry Bakery
Read the Tasty Pastry Bakery Case and answer the following five questions AS A TEAM of 4~5 team members. This is a comprehensive case and covers all relevant topics in class throughout this semester. Be sure to show any of your work and clearly mark the number of each question to correspond with your answer. Your write-‐up should be question-‐answer format. Be sure to provide support for your answers. You must give citations from reputable sources. Those sources can be your notes, book, reputable websites, library books, and any articles you find or have read. If you do not understand a question or require any clarification, contact your professor. I recommend you draw a partial organizational chart for some of the key positions in the organization when you are reading the following case. For presentation, create 1~2 slides for each question. Make sure you include the most important information on the slides.
Tasty Pastry Bakery
Patti Cakes is owner and President of Tasty Pastry, a producer of high quality baked goods with a specialty in Danish pastries, all types of pies (apple, pecan, peach, etc), and Neapolitans, a delectable chocolate-‐filled pastry dessert. When Patti opened her business, 20 years ago, she never dreamed that it would blossom into a successful, $50 million/year business. She now owns a large, 3-‐story factory in San Francisco, CA with a massive oven in each of the 4 huge kitchens that are equipped to the hilt. One half of the third floor of the building houses office space where Patti and her VPs are located. Part of the plant is dedicated to the automated packaging operations, part houses the four kitchens and part houses the distribution and delivery divisions. As of January, 2017, Patti employs about 200 people, who create, bake, package, and sell all her goodies across the United States and even some parts of Canada. Patti’s overall business strategy is to have a high concern for quality products and she is willing to invest in her product to ensure that quality. Her focus is long term and she hopes that her unique, superior recipes for her pastries will sustain her competitive advantage. It seems her strategy has paid off and her business is thriving. As for her HR strategy, jobs are relatively fixed and explicit. Patti provides training and promotional opportunities whenever she can. For example, there are four levels of food handlers, bakers, and chefs and her employees are encouraged to move up the ladder as positions become available. Moreover, Patti has always tried to involve her employees in any major decisions that come about. About five years ago, she had to make a decision about whether or not to invest in a fourth kitchen. The cost would put a strain on the company’s finances but without it, the company could not grow. Employees unanimously voted to make the capital investment and were even willing to take a pay cut if necessary. Today, five years later, the business is booming.
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This year just last month, Patti took her first vacation in almost 18 years: a skiing trip to Aspen, Colorado. Unfortunately, Patti had a nasty accident and broke both her legs, her left arm, and a couple of ribs and well…needless to say, she is out of commission for a bit. Although she monitors what’s happening with the business from home, she now has to depend, more than ever, on her VPs to handle all that arises. Of course, this accident couldn’t have occurred at a more inopportune time because, while Patti was away, her VP of Sales, Joe Talksalot, decided to quit and go to work for Flowers’ Bakery in San Jose. The VP of HR, Mia Valueue, figures that Joe quit because he didn’t want to deal with the problems he was having in his sales division. Two of his sales people, Moe Ron and Izzy Honest have been having a feud for quite some time now. Moe has been accusing Izzy of having an affair with the Sales division’s secretarial assistant, Unis R. Sultry. UR, as her friends call her, is a gorgeous, buxom, blond (dyed, of course!), 5 foot seven, about 110 pounds who wears some of the shortest skirts and tightest tops in the offices of Tasty Pastry. She’s the envy of all the women and lusted after by all the men. Of course no one usually says anything to her except Izzy, who constantly makes comments to her about her good looks. Just last week, one of Moe’s sales assistants, Kenny Makeasale, heard Izzy repeatedly asking UR when she could make it over to his house. Kenny reported back to Moe, saying that UR was a bit vague, but it sounded like she was going to visit Izzy some evening during the next week. Kenny also told Moe that Izzy was constantly showing UR his Playboy calendar, telling her how great she’d look in that pose. The problem is that despite UR’s good looks, her work performance is far from good. Usually she makes numerous mistakes on typed reports; she usually takes a two-‐hour lunch when company policy calls for a 45-‐minute lunch; she’s often seen filing her nails rather than filing customer reports, and her telephone skills leave a lot to be desired. Just last week, Kenny heard her answer the phone with a curt “hello,” not even identifying the company. Kenny told Moe that he thinks UR is totally bored with her whole job and he’s never seen her take a single written note or message for anyone. Every Wednesday, a representative from Baked Goods Distributors (BGD) makes a visit to Tasty Pastry to arrange for the wholesale purchasing of numerous baked goodies that BGD will distribute to supermarkets, restaurants and specialty stores across the western region. For the last six months, that representative has been Mach O’Guy. Mach O’Guy is tall, dark, and handsome and it is clear that all the women think he’s cute. Every week, when he arrives, Mach O’Guy takes a few minutes to speak to each and every one of the women as he walks through the office and then he sits on the edge of UR Sultry’s desk, chatting away for about an hour before he knocks on Izzy’s door to work on that week’s sales arrangements. Kenny thinks all this chatting with women is a front and that O’Guy is actually gay. For the last month, Kenny, has been making little nasty comments to O’Guy, whenever he gets the chance. Three weeks ago, Kenny asked O’Guy if he was going to the gay bar that had just opened up in SF downtown area. Since that time, Kenny has escalated the level of his comments and they have gotten progressively worse. Just last Wednesday, he walked by O’Guy as he sat on UR’s desk and began
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calling him names like fag, gayboy, and queer, under his breathe. When O’Guy later met with Izzy, he told him about the incident with Kenny, but all Izzy told him to do was to “lighten up.” While all this is going on in the Sales division, the supervisor of Kitchen # 3, Bea A. Sheff, is concerned about her salary as well as the salaries for her staff. Bea was talking to her cousin, Cookie Sheff, who does the same type of job as Bea for a bakery in Washington. Cookie earns almost $10,000 more a year than Bea and many of her bakery staff earn more than Bea’s employees. Bea, who’s worked for Tasty Pastry now, for almost 10 years, is quite upset about this and it has begun to affect her performance. Usually, Bea’s shift begins at 5 AM, but lately she’s been coming in a bit later and, unlike before, she never works beyond her 1:30 PM departure. Meanwhile, Bill Meelater, another key salesman for the sales division is having problems with his newest hire, Dis Lexic. Dis, who started his job the day Patti left for Aspen, suffers from dyslexia, a condition where he mixes up the order of letters. This has never been a problem for him in any of his previous jobs. Before coming to Tasty Pastry, Dis worked for Little Debbie Snacks in Seattle, Washington, as a salesman and had received excellent performance reviews. He only left his job to return to San Francisco, because his Mom was really sick and needed regular care. He had heard great things about Tasty Pastry, but after a few weeks in his new job, Dis was concerned that his condition was going to be a problem. Bill Meelater had devised a complex system of keeping track of his clients where each client’s name was abbreviated by two letters. Thus, for example, Honey Bunn’s, a specialty store in San Jose was labeled HB and Barry’s Hots, a deli in Fremont, was labeled BH. Bill insisted that this labeling system be upheld. He argued it saved time and space in the files. But poor Dis keeps mixing up the clients. One day, he not only confused the order for BH with what was ordered from HB’s, but three other orders as well. The errors cost Tasty Pastry several thousand dollars. When Bill Meelater asked what the problem was, Dis explained. Dis suggested that they change the system. Bill had another idea. He fired Dis. One other major issue faced by the company relates to hiring. Nolan Problemo, or “No” as his coworkers affectionately refer to him, needs to hire an employee relations specialist (ERS). This person will be responsible for monitoring work place problems and conducting initial meetings with employees whenever they are considering the need for participating in the Employee Assistance Program (EAP). Tasty Pastry instituted an EAP about 4 years ago. They subcontract with several psychologists in the bay area and they also have two lawyers available who can provide legal counsel and advice to employees if needed. Tasty Pastry also subcontracts with a financial consultant in Palo Alto who provides budgeting and financial advice if this is the problem area for employees. So, the person that No Problemo hires must be able to screen employees to determine the issue at hand; provide good advice and referrals, and ensure confidentiality is maintained at all times. The ERS must also have at least a B.S. in psychology, 2-‐3 years prior counseling experience, excellent communication skills, be friendly, patient, and
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congenial and willing to work under time constraints and sometimes high pressure situations. Typically, to hire an individual at this level, I.B. Picky, the VP for recruitment and selection, places advertisements in the Indeed.com, Mercury News, local NPR radios, and sends letters to several of the colleges and universities in the area. Resumes and letters are screened by IB’s office to ensure everyone meets the minimum requirements. Those applications that meet the requirements are sent to the head of the hiring department who determines how many candidates he/she wants to bring in for a site visit, which usually lasts a full day. Selected candidates first are met by the head of the hiring department (in this case Nolan Problemo), given a complete job description, and a semi-‐structured interview is conducted. Questions for the interview are usually jointly developed between the HR department and whomever is doing the interviewing. The candidates then meet with at least three other individuals with whom they will have contact on a regular basis, if hired. These individuals may be employees the candidate might supervise, colleagues at an equal level, or other VPs within the division to which they are applying. On some occasions, if she has time, Patti likes to interview candidates just because she likes to meet potential employees whenever she can. After lunch, candidates are given a tour of the facility and then shown a film about the company. They are also given material about the mission and goals of Tasty Pastry, and a member of IB’s recruitment staff (or in some cases IB himself) provides the candidate with a realistic job preview that has been prepared jointly with the HR department and the head of the division in which the candidate will work. After all this, applicants are given a personality test, and a work sample test. They are then returned to the head of the hiring department for any final interview questions and are given an opportunity to ask any questions they might have about working at Tasty Pastry and in particular, about the division and job for which they applied. Both the personality test and work sample are graded by recruitment staff members who have been specifically trained to evaluate these tests. A candidate must receive at least a 5.7 on a scale of 1 to 7, on the personality test and the cut-‐off score for the work sample is 93% (translated to a 9.3). All Tasty Pastry employees who interview a candidate must provide a written analysis of the candidate and complete a ratings sheet. All ratings are averaged and an employee must get a 90% (translated to “9.0”) or better to be considered for a position with the bakery. HR also takes into account a candidate’s resume information, cover letter, letters of recommendation, and references from prior jobs, and those must receive a rating of 80% (translated into an “8” for scoring), or better. Thus, candidates are given a composite score and must meet a minimum cut-‐off score of 32, to be offered a position at Tasty Pastry. Typically, when assessing work performance, scores receiving a 4.8 or higher, on a 1-‐7 scale, are considered acceptable.
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Questions: 1. Patti’s administrative manager, Ima Secretary, gave her notice last week. Izzy Honest makes a request for a promotion for UR Sultry, to fill this position. Izzy provides Mia Valueue with an excellent letter of recommendation for UR and reminds Mia of Patti’s policy of promotion from within. Mia talks with Patti since Ima’s replacement would report directly to Patti and both agree that UR does not have the performance record or qualifications to warrant a promotion. UR’s personnel file has numerous complaints from dissatisfied clients and even though Izzy has given UR average performance ratings over the last couple of years, Patti and the other sales managers have not been so favorable in their evaluations of UR’s performance. UR is furious that she is denied the position and she quits. One week later, Mia receives a notice from the EEOC that UR has filed a formal complaint of quid pro quo sexual harassment against Izzy Honest. Her case states that Izzy told her that she must go to bed with him if she wanted the promotion to Ima’s position. Izzy, of course, denies these allegations. 1a. If you were Mia Valueue, how would you handle this situation? What steps would you take and how would you respond to the EEOC? 1b. How would you go about determining if Izzy is guilty? 1c. What does UR Sultry have to do to make her case? 2 Patti received a call at home from the owner of BGD, Sugar Rayner Pye. “Sugar Ray” indicated that BGD would no longer distribute Tasty Pastry products and that BGD, and in particular her employee Mach O’Guy, were even considering a lawsuit against Tasty Pastry for defamation of character. Evidently, when Mach met with his other clients last week, his contacts kept asking him who his new lover was and had they been to the new gay bar in San Francisco yet? Mach believes that Kenny Makeasale contacted these companies and began spreading rumors about him. Patti is horrified and calls Kenny’s supervisor, Moe Ron who assures Patti that he knows nothing about these accusations against Kenny of name calling and rumors regarding Mach O’Guy. Moe tells Patti that all he knows about is Kenny’s observations of the interactions between Izzy Honest and UR Sultry. Of course this information greatly troubles Patti because it suggests that the incident between Izzy and UR is not confidential or at least there are others in the company who know something about the situation. Patti then contacts Mia, asking her to investigate the situation. 2a. If you were Mia, how would you handle this situation? What would you do and what would you report back to Patti. What would be your recommendations? Be sure to explain and support your answers.
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2b. What must BGD/Mach O’Guy do to support a case against Tasty Pastry? 3. Bea A. Sheff has approached Mia Valueue and asked her to investigate all the salaries for her division. There are four levels: Cook I (which is a entry level position requiring minimal work and similar to a cook for fast foods SOC # 35-‐2011), Cook II (which is more of a food prep type position, where the workers prepare the ingredients for each recipe -‐ SOC # 35-‐2021), Cook III (which is a supervisory position -‐ SOC # 35-‐1012) and Chef (Bea’s job -‐ which is the head person who oversees the entire baking operation -‐ SOC # 35-‐1011). Two years ago, the compensation division of HR conducted job evaluations to reassess all Tasty Pastry’s jobs. When completed, the job evaluation points for a Cook 1 were 100 points, a Cook II was 300 points, a Cook III was 700 points, and a Chef was evaluated at 1500 points. Mia asks her supervisor of compensation, Maura Lespay, to investigate the issue. Maura does a salary survey using mean annual salary data from the Bureau of Labor Statistics website: http://www.bls.gov. She decides to look up salaries for the four SOC numbers listed above, in eight different states comprising the Western area. The 8 states she’s chosen are Washington, Oregon, Idaho, Nevada, Arizona, Hawaii, Alaska and of course, California. Using regression, Maura calculates the following pay policy line: Ŷ = 10.10 X + 22,858 (note. Insert job evaluation points in X when you calculate annual salary). 3a. Provide all the central tendency and variation information on your data from the survey. What is the range of salaries for this survey data? Be sure to show your work. 3b. Based on the information you have, what should the market pay rates be for each of the four positions listed above? 3c. If Bea is earning $36,900 a year, is her salary high, low, or where it should be? Explain your answer. 3d. Bea just hired three individuals at the Cook I level. She offered them a salary of $25,000. How does this compare to your information and is this a high, low, or where it should be salary? Explain your answer. 3e. Bea needs to hire a supervising cook (Cook III). Based on your survey analysis, what would you recommend as the salary range for this position? Explain your answer. 3f. If you were Maura, after completing this survey and analyzing the market salaries compared to Bea’s salary and those of her employees,
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a. Does Bea have cause for concern? Explain your answer. b. What course of action, if any, would you recommend to Mia? Be sure to explain your answer. 4. Dis Lexic filed a complaint with the EEOC, claiming he was terminated from Tasty Pastry based on discrimination of his disability, which he says is covered under the ADA. 4a. In order to establish a prima facie ADA violation, Dis must establish that he is disabled and is qualified to perform the job. Is he disabled? Be sure to explain. 4b. How should you go about determining if it is reasonable to accommodate Dis? 4c. Based on your answer to 4b, would you recommend that Tasty Pastry accommodate Dis? If yes, what accommodations would you recommend and why? If not, why not? 4d. What other recommendations besides accommodating or not accommodating Dis, would you recommend to Mia? In other words, how would you recommend she handle this whole situation? 5 Patti knows that No Problemo will be hiring an ERS and she contacts Mia and asks her what information she has regarding Tasty Pastry’s selection processes for this type of position. Although she wasn’t here at the time, Mia knows that the bakery conducted a predictive study several years ago when the EAP program was instituted. Based on that study, the base rate for Tasty Pastry’s ER specialists was 47%. This greatly concerns Patti; she was hoping for a much higher rate. In contrast, Mia points out that their selection ratio was about 67%. In fact, she notices a note on the study materials that they had hoped to increase that number. The validity coefficients of the selection tools being used for an ERS are as follows: .92 for the work sample test; .79 for the personality test, and .72 for the semi-‐structured interview. Even though the interview has a lower validity than the work sample, Mia believes that work sample is a better selection tool anyway and besides, she has lots of evidence to demonstrate that Tasty Pastry’s selection tools are as valid as other similar selection tools. The predictive study that was conducted several years ago showed that Tasty Pastry hired 20 out of 30 applicants. Thirteen of those applicants were true positives, while 9 of those candidates were true negatives. 5a. Is the information that Mia has on the base rate and the selection ratio correct? Show your work and support your answers.
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5b. Should Patti be concerned about the base rate? Why or why not? 5c. In general, what must a firm do to increase the selection ratio? Is this something Tasty Pastry should do? Why or why not? 5d. You learned about four different types of validity (e.g., construct, content, predictive, and criterion). Discuss those in terms of the personality test that Tasty Pastry uses in it selection process. 5e. What changes would you recommend to Mia for handling Tasty Pastry’s selection process and why? If you would not make any changes, you must explain why.