When culture is the key to success

Warren Buffett said, “It takes 20 years to build a reputation and five minutes to ruin it.” Having ethics in the organization and a strong culture that both costumers and employees believe in is the key to success. As Cinny Little mentions on her blog, “strong organizational culture is a powerful talent attractor.” When people believe in the culture of an organization, they want to become part of it and thus there is a huge pull of applicants for each job position. The company is then able to choose among the best employees in the workforce.

In organizations where there is customer service, such as airline companies or restaurants, the more the employee believes in the organizational culture, the more willing he is to help the costumer. Costumers gradually become loyal to the companies because they enjoy having good customer service and the organisation enjoys repeated sales. For example, as Ken Makovsky mentions in his blog, the success of Southwest Airlines mostly lies on its culture. As mentioned in the blog, Southwest inspires employees with the mission and the vision statement of the organization. Employees believe in what they do and that is reflected in their work, which in turn satisfies customers.

Ken Makovsky’s blog shows that Southwest Airlines values transparency among employees. This technique enables employees to feel included in the decision making process, which then makes them more willing to carry out the decisions made. The employees can follow the culture of the organization because they are selected mainly on the premise of whether they fit the culture or not. Sometimes it is better to select a “less skillful” employee that is perfectly in line with the organizational structure than one that is the “most competent” one. If the “most competent” one cannot eventually integrate himself into the organizational culture, chances are he will quit or not be motivated to work as efficiently, which is harmful for the organization.

The most important role of organizational culture is to make employees included. Simple things such as a company moto can significantly contribute to the employees’ sense of belonging to the organisation. Maslow’s hierarchy of needs highly emphasizes the importance of social needs in employee motivation and organizational structure highly contributes to that.

The Importance of Followers

Gordon Lam in his blog post raised a very interesting issue. The media, history and textbooks have long focused on the importance of leaders. However, there is no leader without followers and thus followers are equally important. Our professor showed us a video in class. The video portrayed people who were sitting on the grass in the middle of a sunny day when a person decided to start dancing. For some time, he was dancing on his own, so it seemed like he was embarrassing himself. This all changed when a few followers joined him. Then within a few minutes his dance became a massive event full of people who seemed to enjoy themselves. At that point the people outside the dance were outsiders. This outlines the importance of followers, because without them, there is no group.

Gordon Lam points out that although “everyone aspires to be a leader,” “there must be followers.” Followers can be leader themselves and may have followers of their own, which is often the case in organization. Followers can also depend on one another, which another form of power. Gordon explain that followers do not have to agree with everything the leaders say. In contrast, if they absolutely disagree with the leader’s decision, they can threaten the leader, if not the entire organization or government, by stop working. An example is Apple. Although Steve Jobs was the leader of the organisation, if it wasn’t for the engineers and the rest of the employees with the know-how and the expertise, the iPhone would have never been built. Thus the threat of employees going on strike, gives them a lot of power over the decision making process.

The leader’s job is to make the followers willing to follow him. Effective leaders enable their employees to feel useful, included and unique. As Harper Zhou mentions in her blog, in Eastern cultures such as China and India “leaders often maintain a supreme power over the decision-making power.” While in western cultures where “individualism” and individual traits are valued more, leaders tend to me more “democratic”. The leader’s behavior is important because it determines willing followers are to follow and thus how functionalthe firm is.

Teamwork and Employee Satisfaction

Gurleen Gill in her blogpost posed the question of whether “teamwork can be the solution to all problems.” I do not know if teamwork can effect “everything” but it can have a significant impact on employee intrinsic motivation. Humans are social species so interacting and working in a group sounds more promising than working alone. However, working in team can pose risks as a dysfunctional team can lead to more employee dissatisfaction than a job without human interaction ever would.

The most important aspect of working in a team is the relationships built between the team members. Effective teams have open communication, clear purpose, clear rules and work assignments and shared leadership. In such teams, each team member can express his idea, which is heard and valued. Employees build strong relationships with their team members and feel included and useful to both the organisation and the team.

Maslow’s hierarchy of needs explains that such interpersonal relationships and this sense of belonging satisfies people’s social needs and thus acts as an intrinsic motivator. As a result, employees that work in functional teams are more eager to go to work, more willing to stay for longer in the office and less willing to quit their job. This decreases the “labor turnover” and “absenteeism” as Gurleen also mentions.

However, a team can be dysfunctional or, to the extreme, team members can be abusive to each other. Ineffective teams might not share issues and concerns, or fail to carry out decisions. However, the most detrimental teams in employee motivation are those with hidden conflict and subgroups. In such dysfunctional teams, some members feel excluded and their opinions and ideas are not heard or are undermined.

Herzberg’s motivation theory explains that being undermined and not heard violate hygiene factors so employees are not only not motivated, but are totally dissatisfied with their work. Such employees might stay in the organisation only because of extrinsic factors, such as money. Employees who feel excluded from their teams are more willing to quit their job and are less eager to go to work in the morning or stay longer in the office. In this case, the employees are more miserable working in a team than they would be if they were working alone.

Zappo’s Human Resource Management

Zappos motivates its employees by following a hierarchy system called “Holocracy”, in which the differences between employees and managers are not easily distinguishable. The CEO, Tony Hsieh, asked the managers to distribute authority to their teams and get rid of their titles. The CEO himself has a salary of just $36000 and his desk is the same size and in the same room as everybody else’s. At the same time as asking managers to decentralize their work, Hsieh asked team members to take ownership of their own work. The results were amazing. By distributing authority and ownership over employee’s work, employees find the time and space to be creative and focus on long term projects that had in their to-do list for months.

The recruiting process at Zappo’s shoe company is an even more interesting case study. All employees have to pass through two interviews. The one assesses whether they are competent for the job and the second assesses whether they fit the environment and ethics of the company. In addition, each prospective Zappo’s employee, even a new CFO, has to go through a five week training process, which include a two week period of talking to costumers on the phone. Although this is a very expensive recruiting process, it pays back as the company makes sure that everyone working in it is not only competent is but also in line with the firm’s ethics, mission and vision.

After this 5 week training process the company offers the trainees 3000 dollars to leave the company. The ones who accept the offer would have not been passionate about their job in the first place and the ones that reject the offer enter the firm committed and loyal willing rejected the offer to work for the firm. By taking the risk and following such innovative and expensive human resources management, Zappo’s attracts the best employees, who it then trains and makes sure they give their 100%.

Ethics in Victoria’s Secret human resource management

Have you ever wondered why there is only one African American and no Asian angels in Victoria Secret? Is it because Caucasian girls are more competent for the job? Of course not! Victoria’s Secret has a very narrow definition of beauty, and has been accused several times for unethical behavior in recruiting their angels based on unrealistic and stereotypical beauty standards. Fashion lovers from all over the world watch the Victoria’s Secret Fashion Show each year. Girls and women relate to the angels as their role models. However, most get disappointed because of the unethical process that Victoria’s Secret follows at recruiting their models.

The models cannot be shorter than 5 foot 9 and their figure must be 34 by 24 by 34 inches and although it is not stated, Caucasian models have a higher chance to be selected. This unethical way of recruiting the models is just the start. Once they are selected, the models must exercise two times a day with personal trainers while they are told what and when they can eat and how many calories they can have per day. Everyday girls who look up to the models think less of themselves. However, this should not be the case because not everyone is able to afford personal trainers and personal dieticians and not all women are 34x24x34 or more than 5 feet 9, or Caucasian but all women are beautiful in their own unique way and should never look down on themselves.

A scandal showing the brand’s unethical behavior occurred just a few years ago. A Victoria’s Secret advertisement portrayed a model with a disproportionate amount of fat on her thighs because of a Photoshop mistake. This mistake made it obvious that the brand had been excessively using Photoshop to sell its products by promoting unrealistic body expectations. The brand was accused for unethical behavior even from some of the most loyal of its fans.

Another incident occurred in 2014, when Victoria’s Secret launched a campaign with the slogan: “the perfect body.” This advertisement was featuring 10 models wearing nothing but lingerie. The brand received great criticism and was accused of body shaming and placing unrealistic standards because not every woman has the body of a supermodel. A petition against the advertisement received over 27,000 signatures and the brand had to change the slogan to “A body for every body.” However, the fashion industry overall is even more unethical as Victoria’s Secret models must at least gym and appear healthy instead of anorexic.

In class exercise

My worst job was two years ago when I worked at a bookstore at the cashier. Firstly, this was the worst job because the company had hired way too many employees for a small workload so I felt redundant. The second reason was that the employers had not given a specific description of the job position so I did not really know what to do and what they needed me for. Finally, there was no feedback or communication with the employers so even when I did find something to be useful at, nobody recognised my effort. Overall this was the worst job because it was dull, and I felt useless.

Motivation at Starbucks

In one of my classes in the first year of university we talked a bit about the importance of motivation in the workforce not only in terms of lowering the labor turnover but also in terms of satisfying the costumers and making them loyal to the firm. However, I had never experienced the importance of employee motivation in real life myself until this winter break.

It was the third of January in Greece and I had just met my friend Lisa who I had not seen for a long time. As we were walking outside a Starbucks store she said “Let’s get in to say hi to Sara.” Sara was the Starbucks barista. Not being a great fun of coffee myself it was the first time I entered a Starbucks store after three months and I looked at the barista’s behaviour from a different perspective. She was friendly, welcome and seemed to really know Lisa, who she of course called by her first name. Before learning about motivation factors I thought that Sara’s behaviour was her personal character, but I then understood it was all about Starbucks motivating her to behave in such a manner.

I then made a research and found out that Starbucks does, indeed, give great emphasis on the quality of services and the motivation of employees. The idea is that people need to be highly valued, trained, motivated and financially rewarded in order to perform in a way that would satisfy the costumers and make them loyal to the firm.

Based on the equity theory employees in the workforce should feel that they are working in a friendly, lively and enthusiastic environment, without a sense of status within the organisation. Starbucks tries to achieve that by calling their employees “partners” and by making the distinction between the managers and the employees as small as possible. As I later found out Sara was the manager of this particular store but she was wearing the same cloths and worked in the same fashion as the rest of the employees so costumers could not make a distinction.

Starbucks tries to motivate employees both intrinsingly and extrensingly. Employees get trained not only in how to make coffee but also in how to treat and deal with costumers. Gaining knowledge and being able to perform their job well is a basic intrinsic motivation. In addition, Starbucks provides performance-related payment so the more employees contribute to the business, the more they get paid, which motivates employees to work more to gain more money.

Lisa goes to this Starbucks store at least three times a week to say hi to Lisa and Starbucks gains money because of that. Lisa would then tell her friends, including myself, that Starbucks is a good place to get their coffee from, and Starbucks will gain more money because of that. So through this event I realised through a real life example that motivating employees creates loyal, satisfied costumers who then bring more costumers through word of mouth.

Toblerone is one of the most known Swiss chocolate brands. Its point of distinction that has differentiated from its competitors and has created consumer loyalty has long been the triangular shape of the Toblerone chocolate bars. The whole bar is in the shape of a triangle and is divided into small triangles packed close to each other. Recently, Toblerone changed two of its bars, the one weighing 400g and the one weighing 170g by widening the gaps between the triangles and thus reducing the weight by bar to 360 and 150 grams respectively, but without changing their prices.

Toblerone argued that this decision has long been planned because the price of cocoa has been increasing while the value of the Euro has been decreasing compared to the Swiss frank and thus a reduction of costs was necessary. However, many consumers, including the most loyal ones, have been dissatisfied with this decision.

In my opinion this decision has some positive and negative aspects.

On the one hand, the reduction of chocolate per bar could be used as a technique to promote Toblerone’s care about the wellness of its consumers. By reducing the amount of chocolate per bar for the same price, people might be motivated to consume less chocolate per day thus improving their health.

In addition, the reduction of weight per bar with the same price, increases the revenues and profits of the firm, thus increasing the profits of the firm.

However,  this decision can destroy the relationship with some of the most loyal consumers as the shape of the bar has long been its point of distinction. Since Toblerone wanted to increase the difference between the cost and the revenue to gain more profits, it might have been better to increase the price per bar than to reduce the amount of chocolate per bar. Loyal consumers would be willing to pay more for the bar they so love, but they might not be willing to consume less of it. I think that a slight increase in price would have been less visible than the actual shape of it. 

 

WestJet’s implementation of Baggage Fees

As Austin Cho pointed out “WestJet is facing a lawsuit for its recent baggage fee implementation.” With this as a starting point, he argued that that this decision is “merely a cash grab” as people who want to have a baggage will now have to pay more to do so and thus WestJet could increase its profits from the people who are willing to pay the fee.

I totally oppose that view, and I will explain why.

WestJet has targeted a niche market of consumers who would not travel first class but would rather travel in a baggage to reach a destination quickly but with minimum costs. It is thus rational for WestJet to assume that its consumers would be happy to pay a cheaper ticket by reducing their packing.

This assumption means that the number of WestJet consumers that will pay the fee will not be large and thus the collection of the fees will not be enough to increase WestJet’s profits but  would merely cover the costs of transporting the baggages. Consumers are currently forced to pay tickets that  include the option to have a baggage. By introducing a baggage fee people’s option gains a financial repercussion to it. WestJet would thus give people the option of carrying a baggage without charging then ahead of time. 

Globalisation increases the demand for transportation by airplanes as an increasing amount of people either have to or want to oftenly travel for work,  entertainment or education.  Traveling by plane is the fastest but most expensive means of transportation and thus people are increasingly searching for cheaper alternatives. WestJet has tried to tackle this exact demand and thus provides cheaper airplane tickets to consumers by minimising its costs without affecting the safety of the passengers on board

WestJet is able to achieve this by for example providing less or no on-board complements for its consumers or by not landing to the largest airport of each city to reduce parking costs. In my opinion, implementing a baggage fee is another example of trying to reduce the cost of the tickets as it reduces WestJet’s cost of packing and unpacking the baggages.

All in all, WestJet’s ultimate goal is to reduce the cost of the tickets as much as possible while still making profits. Implementing a baggage fee reduces the cost of the tickets for the people who are willing to travel without a baggage while covering the costs of transporting baggages by collecting the fee. The goal is met, the consumers are happy and as a result the implementation of the fee is a smart decision.

 

 

The first male CoverGirl as the best promotion for “So Lushy” mascara

James Charles, a seventeen year old boy became the first male CoverGirl last week. Janine in his beautygeek blog argued that the reaction to that event is mostly positive. “So Lushy” mascara is the brand behind the cover and has thus been associated with the idea that men should not be stigmatised for wearing makeup. The make up he wears in the cover is heavy but natural and accentuates his facial features – the main purpose of make up.

Women do not wear make up just to look good for others. Most of them enjoy the whole process of improving their appearance and playing with colours and looks. They wear make up to feel more confident about themselves, and their appearance and it is a way to boost their self esteem. So women often wear makeup for themselves and society allows them and encourages them to do so.

There are men on the other hand who would like to wear make up but society tends to stigmatise them when doing so. I think that one of the most influential means to change society’s perception is advertisement as not much more than a century ago advertisement persuaded a proportion of the entire world to brush its teeth first thing in the morning.

Thinking from a rational objective business perspective I think that the marketing strategy of “So Lushy” mascara is very smart. Both men and women have eye lashes and both men and women want to look good when interacting with other people or when looking themselves in the mirror. However, mascara brands have been only targeting the female population for so long ignoring such a large proportion of the population.

Reconsidering and expanding the target audience of a firm is called market development and is a very common technique firms use to extend the life span of a saturated product. “So Lushy brings that technique that to a totally different level as it opens a whole market to a huge market segment. I honestly believe that men’s makeup will become almost as common as women’s makeup in less than a century away and that can generate huge amounts of profits for all mascara and makeup brands. However, if “So Lushy” grabs the opportunity smartly enough, it could gain loyalty from all the men who admire James Charles’s, as seen by Janine’s blog,  and it could gain women’s loyalty who feel that makeup should have been for everyone since ever anyway as is also illustrated by Janin’s blog.