Acme Productions Human Dynamics Analysis

ACME PRODUCTIONS OVERVIEW
Acme Productions is one of the largest independent, full service television and video production companies in the country. Acme Productions was founded in 1981 and originally headquartered in Northern Virginia until 1991 when it expanded to a custom designed building for television production located in Washington D.C. With a full time professional staff of over 70 employees, Acme Productions has grown over 220% since the recruitment of a new President & COO in 1998, but in recent years their growth become unstable and profitability figures have started to decline (See Exhibit 1).

Acme Productions has been a pillar in the Washington DC production community for over 23 years, offering remote production, studio production, program playback services, production management, editing, graphics production and design, film-to-tape transfer and color correction, audio editing/mixing, original music, video duplication, distribution via satellite, fiber and the Internet. Over the years, the company has invested over 40 million dollars in state-of-the-art technology and facilities.
The companys client base is both vast and diverse, and Acme Productions is known for its creative talent as well as the state-of-the-art technological resources. Acme Productions currently produces several highly rated broadcast television series for several of the top cable networks such as HBO, Showtime, MTV, Comedy Central, The Discover Channel, Animal Planet and ESPN. The companys mission is to offer exceptional broadcast production management services, experienced technical staffing, creative production development and an unsurpassed broadcast production infrastructure. Their goal is to meet the needs of their clients and facilitate their vision from concept to completion. Their clients include major networks, government agencies, corporations, and independent producers. Acme Productions clients leverage their talent, experience, and infrastructure, to create full-scale live events, broadcast specials, and series. Today Acme Productions is known for its extreme flexibility, efficiency, high quality standards and customer service.

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IDENTIFYING THE ISSUE
Acme Production was a struggling company with low profitability and limited success up until 1998. That is the year that the Board of Directors decided it was time for a change and recruited a new President & COO, Mr. Bill Smith, to turn the company around and take the company to the next level. Mr. Smith quickly developed an aggressive 5-year business plan to turn the company around. This involved sweeping changes throughout the company to introduce and incorporate a new philosophy, technical infrastructure and managerial structure. Mr. Smith was seen as a visionary with a keen sight on the future and an aggressive pacesetting and coercive leadership style (Goleman). Initially there were sweeping changes, which created an old vs. new atmosphere among the employees.
The company only had around 45 employees and no Human Resources department. The Board of Directors and the new President felt the company was too small for a Human Resources department. Unfortunately, without consultation from a Human Resources point of view the implementation and transition to the new strategy and goals of the company from a human capital perspective was not effectively addressed. This oversight and aggressive timeline created a rift in the attitudes of the existing employees vs. the new employees and new management, which were being brought into the company.

Mr. Smiths vision and aggressive new strategy for the company enabled the company to rapidly grow over 220% in just over 5 years. However, in the wake of the financial success of the company, the morale and motivation of the employees seemed to have not been a focus of the growth and became more apparent as the financial success of the company reached a plateau.
Currently there are classic indicators of a morale and motivational issue among the employees at Acme Productions. There are several key indicators of morale and motivational issues in the company:
1.A High level of employee turn around in all departments of the company and at all levels including management. Out of the over 70 current employees, only 7 of them were employed with the company in 1998.

2.An open distrust of employees on management as well as underling distrust between the various levels of management combined with the perceived perception that management expects the employees to deliver on their promises to the company, but the company does not deliver or modifies perceived promises made to the employees.
3.The management staff has had little or no management training therefore simply reflect down the aggressive management and leadership style of the President without a complete and clear understanding of alignment with the companys strategic plan or goals. Also due to the leadership style of the President he is perceived as a micromanager from the management staff.

4.After experiencing a large financial growth since the change in leadership, the financial growth of the company has reached a plateau and actually started to struggle to maintain the growth despite being one of the most technologically unique and advanced television production facilities in the country.

As the companys staffing needs quickly expanded and the apparent company morale issues began to grow and become more apparent, the need for a Human Resources manager became evident to Mr. Smith and the Board of Directors. In late 2002 the company finally hired a full-time Human Resources manager. For the first time since the leadership change in 1998 some focus was given to improving the human dynamic part of the strategic growth plan. However this focus was not as aggressive and focused as the other goals of the growth plan which presented delays in approval and implementations of Human Resource strategies that were developed. Since a full time Human Resource manager position was created the following steps were taken to improve the human dynamics of the company:
1.Anonymous employee surveys to receive more detailed feedback and proved better assessments of the employees perceptions of their roles in the company and the companys role with them. However these surveys were not made a priority which resulted in them being conducted infrequently and little focus given to properly evaluating them.

2.The introduction of company social gatherings, such as a yearly Holiday party in December and a company picnic in the summer.

3.The company has supported several employee run sporting programs, such as a company softball league, a company foosball tournament and a company fantasy football league.

4.A more comprehensive benefits package including a comprehensive medical plan, pre-tax metro-check deductions, employee recruitment referral bonus program, educational tuition reimbursement, and a matching 401K plan available to all employees.

Despite the steps the company has taken, the support and implementation of human dynamic efforts by management is perceived by the staff to be secondary in nature. As one employee stated, Sometimes I feel like the company sees Human Resources as an obligation instead of part of the road to a better company.
IDENTIFICATION & EVALUATION OF ALTERNATIVES FOR ADDRESSING EMPLOYEE MORALE
95 percent of business owners agree that employee morale is a key to business success (workopolis.com)
Low Morale low profits. High Morale high Profits. (sideroad.com)
Studies (sideroad.com) have strongly indicated that the morale of a companys workforce is directly linked to profitability. Acme Productions needs to understand that employee morale is pivotal in creating a unified and functional work environment. Morale influences the beliefs and actions of an individual or a group, as well as dictates the atmosphere of the environment, and therefore it become important for a prudent manager to have a clear understanding of what employee morale means.
Defining Morale
Morale is commonly defined as The state of the spirits of a person or group as exhibited by confidence, cheerfulness, discipline, and willingness to perform assigned tasks (dictionary.com). Morale also symbolizes a dedicated spirit, which unifies individuals toward a common goal (dictionary.com). In their article examining the importance of employee-management relationship closeness, McKnight, Ahmad, and Schroeder define morale (Riely), in the context of the workplace, as the degree to which an employee feels good about his or her work and work environment. The authors say morale serves as a broad term that encompasses smaller concepts including intrinsic motivation, job satisfaction, experienced work meaningfulness, organizational commitment, and pride in ones work.
Roger E. Herman (sba.gov) points to a Robert Half International survey that clearly demonstrates that “compensation is not the predominant reason why people leave their jobs for supposedly greener pastures.” Instead, asserts Herman, “People are hungry for opportunities to grow into their jobs. They crave advancement, both in position and stature, and in responsibility and opportunity.” Surveys performed by Gallup (sideroad.com) have shown that the old-fashioned methods of offering financial incentives, company cars, etc. do not produce long term benefits. Their research has found that as many as many as two-thirds to three-quarters of people employed in Sales, for example are performing at much lower standards, which has detrimental affect on the entire business. This research clearly indicates the need for intrinsic rewards (e.g. appreciation) over extrinsic rewards (e.g. a pay raise) to boost employee morale.

Once employee morale is clearly understood by the senior management, the next step is to find alternatives to boost employee morale. The recent initiatives at Acme Productions are helping in increasing employee morale, but definitely not to the extent that the company can see positive results in terms of increased productivity or employees going beyond their call of duty willingly. The following initiatives should lead to higher employee morale, thereby increasing the companys profitability.
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INITIATIVES FOR MR. BILL SMITH TO BOOST EMPLOYEE MORALE
“You can’t buy your employee’s enthusiasm, loyalty, hearts, minds, or souls. You must earn these.”(faculty.ncwc.edu)
Change in the management approach: Change needs to start with Mr. Smiths approach to daily management because he represents the organization to the public, he interacts with the highest number of people within and outside the organization, and he sets the tone for employee morale. Mr. Smith started with Acme Productions being a managerial leader (Rowe); one that influences only the actions and decisions of those with whom they work, which was appropriate at that time but now he needs to be more of a strategic leader; influencing employees to voluntarily make decisions that enhance the organization. Several changes in Mr. Smiths management style that will help Acme Productions improve employee morale include:
Leadership Style As the company’s revenue growth has become unstable, Mr. Smith has exceeding increased his pressure on the Director of Sales, Mark Jones, as well as the rest of the management team. As the President of the company, Mr. Smith generates a majority of the company’s sales and uses this fact as his way to negatively motivate Mr. Jones and the rest of the management team to generate more revenue. As Mr. Jones states, “Mr. Smith constantly reminds us he has the most sales for the company and he doesn’t understand why the sales department and the other managers can’t have more sales when he can generate so much without it being his primary focus and in addition his workload which is far greater than ours.” In the past when sales became slow, Mr. Smith would start attending and dominating the weekly sales staff meetings until Mr. Jones began expressing to him that he felt this was ineffective in producing more sales and Mr. Smith reluctantly stopped. This is a clear indication of Mr. Smiths coercive and especially pacesetting style of leadership.

Mr. Smiths initial leadership strategy did help the company reach strong growth historically; however, it seems that the company has come far from the earlier days of inefficiencies and chaos and therefore he needs to re-evaluate his leadership style. To be an affective leader who motivates his staff, Mr. Smith should practice a mix of leadership styles e.g. authoritative and affiliative (Goleman). Acme Productions, being the industry leader has attracted very efficient and productive staff, which is capable of deciding the means given the deadlines and final goals. This means that Mr. Smith should be able to practice the authoritative style of leadership (i.e. communicate the goals to his staff and let them select the means to achieve them). Authoritative leadership style would offer intrinsic rewards to his staff by making them feel that he believes in their competencies and that they do not need to be micro-managed. It gives a sense of self-pride and accomplishment while giving them the freedom to work.
Mr. Smith has true vision for the growth of Acme Productions, unfortunately his currently leadership style does not effectively open communication for feedback or input on that vision from the rest of management or the employees. If Mr. Smith was able to exercise more of an affiliative leadership style he may discover that his management and staff could provide him with valuable input for improved implantation and efficiency in obtaining his goal of growth. In the case of several staff members that are not performing up to their full potential because of personal reasons, as is the case with Stacy, Mr. Smith can improve their productivity by being an affiliative leader.
In the past 5 years with the company Stacy has exhibited above average performance but since she has been going through a divorce, her performance has declined significantly. Rather than yelling at her for the delay in submitting the report, Mr. Smith should try and find the reason why her performance has changed recently. Mr. Smith should not tell and sell by enforcing his idea, instead he could prepare possible solutions that can help Stacy get out of that mode and regain his confidence (e.g. suggest counseling). When Bob Jeffrey, President of J. Walter Thompson (careerjournal.com), an advertising agency, found that one employee was going through a divorce, he helped her out and said I decided wed do everything we could to give her some air cover for a while. He added that he motivates his staff by relying on simple, old-fashioned values, recognizing people and making sure they feel connected to the company. This will increase the motivation and result in higher productivity because the employee feels that the management does care for her and wants to help her (intrinsic reward). In addition, affiliative leadership has strengths of three emotional intelligence competencies: in empathy, in building relations, and in communication, all of which are important intrinsic rewards.


Emotional Intelligence – It takes more than traditional cognitive intelligence (apa.org) to be successful at work. It also takes ’emotional intelligence,’ the ability to restrain negative feelings such as anger and self-doubt, and instead focuses on positive ones, such as confidence and congeniality, claims an emerging school of behavioral thought. Leaders with empathy are able to understand their employees needs and provide them with constructive feedback. A growing body of research on human brain proves that, for better or worse, the leaders mood affects the emotions of the people around them (Boyatzis).

Mr. Smith’s leadership style seems to lack emotional intelligence as he is known for saying things in “the heat of the moment” especially when dealing with issues he perceives as negative. As one manager stated, “Sometimes is as if he takes some business issues so personal. Once while renegotiating some employee contracts he became very offended at some of the concerns the employees had about being treated fairly on a certain point. Mr. Smith openly became upset and began to belittle the employees for expressing what he felt was an absurd and ignorant concern.” This apparent weakness with self-evaluation as well as empathy resonates throughout the company and at times is mistakenly interpreted as part of the companys corporate culture.

Spherion, a staffing and consulting firm in Fort Lauderdale, Florida, and Lou Harris Associates, found that only 11 percent of the employees who rated their bosses as excellent said that they were likely to look for a different job in the next year. However, 40 percent of those who rated their bosses as poor said they were likely to leave. In other words, people with good bosses are four times less likely to leave than are those with poor bosses (Zipkin). This indicates the magnitude of direct impact that the senior management has on the staff. Mr. Smith should understand that the most effective bosses are those who have the ability to sense how their employees feel about their work situation and to intervene effectively when those employees begin to feel discouraged or dissatisfied. To be effective Mr. Smith should also be able to manage his own emotions, with the result that his employees trust him and feel good about working with him.


INITIATIVES FOR MANAGEMENT TO BOOST EMPLOYEE MORAL
Staples Editor, Maura Ardis, (staples.com) believes that employee morale can be increased by numerous initiatives including getting employees involved, being honest, laughing a little, accentuating the positive, celebrating success, thanking all employees, lending a helping hand, encouraging daily walks, and having answers and aid all in one place. Acme Productions currently lacks several of these important initiatives. In order for senior management and Mr. Smith to be able to better focus and understand this issues and their impact the following initiatives should be addressed through professional management training and leadership coaching:
Appreciation: In the past year the HR manager has instituted exit-interviews for employees who have left the company for any reason. In these exit-interviews one comment that has come up repeatedly as something they liked least about working at Acme Productions was that they felt they didn’t receive adequate credit or recognition for work they had done or worse they felt that other people regularly took credit for their work. Senior management needs to convey optimism and send that down the line, with a message that conveys strength and security. Research shows (sba.gov) that people often leave an employer because they havent received the recognition they want, or feedback on how they are doing. The management at Acme Productions needs to encourage and show frequent appreciation of every employee’s efforts, and find ways of helping employees work in jobs that utilize natural talents. Both employees and management need to know that what they are doing is highly appreciated, that opportunities for advancement and self-growth are available within and by the company, and they need to come to work in a happy and positive environment.
Listening: In the past year the new HR manager has developed and proposed several plans on how to motivate the employees and increase morale since management has recognized that this is a concern that deserves attention. However, these proposals are the first to be put low in the priority list of evaluation and implementation in favor of sales,
marketing or cost saving or profit increasing initiatives. As one manager states, “I’m all for improving the morale and motivation of our employees and definitely feel it should be a priority, but Mr. Smith and the board are ‘bottom line’ kind of people and want concrete numbers from us on how we have improved the bottom line. At the end of the day I would get more recognition from saving or making the company a dollar than trying to make the case that it’s more important to focus on a new HR initiative that ‘could’ make the employees happier. Sometimes we are in a position where if we don’t find a way to improve our bottom line we may be forced to reduce some of our staff and I would rather try to save a job than lose a happy employee”.
David Lee (employmenttimesonline.com) explains that dont just talk at employees; listen to them; listen to their ideas about process improvements; listen to their concerns; listen to their opinions. This doe not mean that you agree, nor does it mean that you have to act on every recommendation you hear. It does mean that you respect them as intelligent adults. Few things damage morale and an employees respect for management more effectively than a know-it-all boss who doesnt value the ideas of the people in the trenches. Not listening to concerns also creates a Why should I care about you, if you dont care about me? attitude in employees. Conversely, managers who listen cause engagement and loyalty.


Communication: Many issues or problems occurring at Acme Productions can be resolved through better communications. In employee attitude surveys (Hubbartt), communication from management is almost always ranked low by employees and Acme Production is no exception. Weekly meetings, open door policies and regular visits with employees will help Acme Productions control the rumors that are often damaging to staff morale. One of the strengths at Acme Production is its on-going training programs and the training program realistically should lead to increased employee morale; however, the company does not receive a favorable response from its staff for the following reasons:
1.As some employees learn a new skill or job they feel they are entitled to a pay raise. These employees fail to understand and management fails to effectively communicate that the company has invested in that employee through training and the company must first receive a return on that investment before the employee can receive a raise. These employees are not recognizing the value of the training itself.

2.Some employees fear that if they are more cross trained and able to do more they may put some of their fellow co-workers who are not as cross trained out of a job. These employees are failing to realize that it’s the employees who are not taking advantage of cross training opportunities that are putting themselves out of the job and becoming less valuable to the company not the other way around.
Compensation Disparity: As indicated earlier, compensation itself is not have a major impact on employee morale, but a disparity in compensation does have a negative impact on employee morale. The compensation structure at Acme Production is one, which is based more on supply and demand than with no real formal scale for each position. Salaries vary greatly among department as well as managers. In some departments there are even subordinates who are paid more than their supervisors. Recently an employee accidentally discovered a company fiscal budget, which included the salaries for the entire company. This employee shared the information with several staff members before he was found by management to be spreading this confidential information and was reprimanded. However, the damage was done and word quickly spread about the wide variance in salaries throughout the company. Instead of addressing the issue management chose to ignore it and assume that employees should understand that compensation is based on many factors even though they had no defined criteria.
Salary equity among (uscfhr.edu) internal employees is an important consideration when setting starting salaries. Perceived inequity not only impacts employee morale and motivation but also may trigger contentions of discrimination or grievances. When setting starting salaries, the skills and background of external candidates should be compared to those of internal employees performing similar work, and this comparison should factor into the salary decision. Salary equity does not imply that all employees within a classification who have similar years of experience and education should be paid the same salary. It is assumed that recognition of varying levels of skills and performance, for example, will result in differences in salary among employees.

Herman (sba.gov) warns that despite the best of intentions in creating an optimal working environment, not every employee will respond the same way to everything you do. “A good leader should focus on treating each employee not equally, but fairly. More than ever before, we are leading a workforce of individuals. It is essential we recognize and appreciate their differences.” People are hungry for opportunities to grow into their jobs. They crave advancement, both in position and stature, and in responsibility and opportunity.


EXHIBIT 1
Acme Productions Yearly Revenue 2000 – 2005

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