FIN 422 Week 4 Textbook Problems

Week 4 Textbook Problems

FIN/422

Week 4 Textbook Problems

#1 a-f

#2 a-f

1. From a labor economics standpoint, are older workers more expensive? What factors would you use to assess this issue?
   • Older workers are in fact more expensive as they are there for a long time. I would evaluate the production rate of these employees because their production could be slower, thus costing money as well to the company.
   • There may initially be a reduction in productivity, as there would be a learning curve for the new employees. As mentioned previously, having employees that are older and have been with the company for a long time are likely to fully understand the procedures, but are likely to be slower with production. Younger employees, on the other hand, can become well trained, thus making them more productive.
   • It is possible that the company would need to freeze additional hiring’s, cut bonuses and raises, and overtime if the company is having a hard time with trying to make cuts. Another alternative could be to reduce wages and certain benefits. On the other hand, this could lead to employees voluntarily resigning, possibly even without notice, which would drastically impact production.
   • To help encourage voluntary separation of senior employees, it is beneficial to have a voluntary buyout that could be explained to these employees as a good option to guarantee retirement. Having a financial incentive would be a good perk as this could help with their expenses until their pension takes effect and are close to their desired retirement age.
   • If senior employees understand the benefits of taking the early retirement package, then they are very likely to take it. There is also a chance, though, that would want to wait for the company to downsize and retire in a few years. I would say that if a large number of senior employees take the retirement package, then it would be considered a success.
   • It would be important for the method to first be implemented by HR, as this would be the best way to understand the areas of need and opportunities for the company. It is beneficial that this is followed when it comes to hiring and training first and foremost for the departments that have been seen as having the biggest need.

   Describe a range of possible solutions that does not necessarily involve reducing the level of benefits and wages, but might serve to reduce the ratio of labor costs to sales and would be consistent with the overall business strategy of building sales and profits through top service, competitive prices, and great product variety.

   What analytical steps, metrics, and assessments would you apply to each?

   Are there possible total reward solutions that might help to attain your objective? Briefly identify them and explain.

   How would you measure and evaluate each?

   #3 a-d

   1. One possible solution would be to reduce turnover by properly training employees from the time they start working for the company. Another solution could be to cross train employees so they are not limited to just one area of work, so if needed, they can help out in other areas.
      • After the issues have been identified, the long term solutions then can be measured equally. It is important that the company evaluates the different options and monitors the progress. This can be done by monitoring the team and then evaluating the results.
      • I find that having a staff that is very well trained is very likely to increase productivity of employees. Having turnover reduced, also provides confidence to the employees to let them know that they are doing a good job and are meeting or exceeding the goals that are in place.
      • Once the plan is in place, it would be best to evaluate the sales and turnover statistics. The costs will likely be reduced if there are several employees that are able to work in a number of different areas, thus making it so that the number of employees on shift are reduced.
      • Select a comprehensive plan that you believe will enable your company to be price competitive without changing the level of benefits and wages.
      • To implement a comprehensive plan, there needs to be a clear strategy or method. Using the steps of lean six sigma can help make less stressful and simplify the process of creating a plan. This strategy is as follows: define the problem, measure the problem by collecting information, analyze the information and look for the cause of the problem, improve the overall performance of operations by creating maintainable solutions, and control the improvements and document the results.
      • Describe how you would measure and evaluate your plan.
      • Once the problem has been identified and possible solutions are discussed, it is really just a matter of keeping records while tracking improvements. Every employee is different, so the goal of the plan needs to be to improve the productivity for each worker by training them in their best areas to where they become an asset the company.

   What analytical, research, data collection, and assessment steps would you undertake to fulfill this assignment? Explain in detail.

   Can you link your health care plan to a potential increase in productivity? How? How would you measure?

   With respect to quality, how would you make sure this element remains an integral part of your plan? How would you measure it?

   Identify an optimal plan design, including all of its major design features, that you would recommend to the CEO. What factors would you use in measuring its value to the company?

   Include a paragraph explaining how you can apply what you’ve learned in this chapter to your job.

   1. The steps that are important when looking to achieve the desired conclusions are as follows: have a clear purpose, define the scope of the assessment, develop key questions, and develop a list of objectives. It would be best to use a quantitative method to develop clear solutions, once these steps have been outlined.
      • When employees are healthier and more active, they are likely to not miss as much work, thus resulting in higher productivity. To measure this, the company would want to look at information related to absenteeism and claims from workers. If these numbers are very high, that could be a sign to the employer that the workforce is not performing to the best of their ability.
      • Employees that have good morals are happier employees. Employees that are happy tend to be more productive and efficient when it comes to the workplace.
      • An optimal design plan should include: family or individual plans, cover all major illnesses, ensure yearly checkups are covered, cover emergency services, have it be hassle free while having premiums that are maintainable.

   What I have learned in this chapter will help me at my job when it comes to assessing situations, coming up with a plan, and implementing the plan for success. I have also learned so much more about how to access employees benefits and what could be desirable to be successful employees by improving the overall production and loyalty of employees. This chapter really explained the many different perspectives when it comes to making decisions that may impact the benefits package offered to employees, along with the types of decisions and different considerations that should be included when making these decisions.