Management 201

.. ole exceeds the projected goal. When this happens, 5% of the excess is divided amongst the employees and added to their salary as a bonus. This obviously motivates them to make as many sales as possible individually as well as a group. The objective of these programs is to give a sort of pat on the back that says good job people! As one could imagine these are the most popular programs in the company. Perks, which make up another large part of the reward program, come in a close second in the popularity contest. AAA offers a variety of perks that would certainly motivate employees to want to stay with the company.

First, all employees receive a free AAA plus membership for themselves as well as one additional adult residing at the same address after the completion of six consecutive months with the company. This membership can add up to thousands of dollars per year when used for discounts at a multitude of hotels, resorts, restaurants, as well as many other establishments. Second, employees may elect to enroll in the AAA savings plan. This plan deducts a certain percentage of their basic earnings from each pay that is then matched by the company and put into savings for the future. This plan has proven to be a successful program for both the company as well as the employees. It motivates the employee to give long term service to gain a substantial savings, which generally benefits the company as well.

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A third perk that employees may enjoy is the insurance coverage offered by the company. AAA offers a variety of coverage including medical, dental assistance, life and long-term disability, and travel accident coverage. For several of the employees in this office, the insurance benefits initially attracted them to the company and are what motivate them to keep their employment with AAA. The fourth type of perk enjoyed by many AAA employees including Ms. Pacior is the educational assistance plan.

Under this program, an employee is entitled to reimbursement for tuition and educational material costs up to a maximum of $2,000 per calendar year. Classes which deal with subjects that are related to an employees current position or to work performed at AAA, are eligible for reimbursement. The courses, however, must be taken through an accredited university, college, business, or technical school. Also, they must have a letter grade of C or better or Pass if the course is pass/fail. To receive the reimbursement, employees must submit a written grade report and receipt for tuition paid and materials expenses. Ms.

Pacior is currently working towards her bachelors degree in business and hopes to finish next semester. This will strengthen her chances for advancement in the company. The final perk I found that the company offers (which was also mentioned as being part of morale motivation) is the vacation time program. Employees are entitled to a specified number of vacation days depending on how long they have been with the company. The chart below outlines the qualifications necessary to earn vacation time.

Employment Service Full Time Part-Time 1st year, hired before June 1 1 day per month employed between January 1 and May 31 Average hours worked daily times the number of months employed between January 1 and May 31 1st year, hired after June 1 0 0 2nd year 5th year 2 weeks Double weekly hours worked 6th year 14th year 3 weeks Triple weekly hours worked 15th year 24th year 4 weeks 4 times weekly hours worked 25th year + 5 weeks 5 times weekly hours worked As mentioned before, in addition to the time off of work employees are paid their full wage as if they were there in the office working. This program had no opposition from those agents who have taken advantage of it and it is not difficult to see why. The objective of this program is not so much to motivate as it is to encumber job burnout. Unfortunately employees may become overwhelmed with some of the monotonous tasks of everyday work and need time to relax and unwind so as not to become unmotivated. Vacation time has proven to be an effective antidote for this problem. The third and final type of reward that AAA utilizes is recognition.

The only formal program dedicated to giving employees recognition in their employment is the service recognition award banquet. This banquet is held to honor employees for a variety of reasons including those who achieved five-year milestones, top sales for the year, friendliest employee (as voted by patrons of the company) and also those employees who have exhibited vast improvement from the previous year. These awards, especially those which are accompanied by a cash bonus, clearly motivate and encourage employees to strive to perform to their potential. The employees of AAA clearly value these awards by displaying them on and around their offices for all to see and admire. It is difficult to recommend changes to these AAAs motivational programs mostly because of the fact that they have been in existence for decades.

They have refined them time after time in an effort to reach optimal motivation among the employees. Besides some small cosmetic changes, there was one program in particular that I would suggest to AAA that I believe would assist management in achieving this goal. I have noticed that there is what I believe to be an oversight in the way the individual bonuses are distributed. AAA sets a goal and expects all agents to achieve that goal. The problem with this program is that some areas such as large cities provide travel agents with much more business from which to earn commissions than that of offices the size of the Reno office.

These large offices may have more than ten times the clientele than that of the smaller. The result is that the smaller offices rarely have a chance to make any significant bonuses while the large city offices are making arguably too high of a bonus. This has been devastating to the motivation of the smaller offices. Why should we try so hard when we know we won’t make the goal, says Ms. Pacior. She makes a good point.

Perhaps the corporate office could make goals based on individual offices or at the very least districts so agents perceive themselves as having the distinct opportunity to earn bonuses at the end of each year. This would undoubtedly produce motivation and consequently earn more income for AAA. As I stated this is one problem I found during my analysis of AAA, yet I do not hold that it is the sole problem the company faces. A broader study of the company may reveal deeper problems that my informational sources have allowed. Collectively, AAA does an outstanding job of motivating their employees, a task that many companies that are larger and older have not yet mastered.

The Frederick Taylor method has proven, at least in this situation, to be an effective manner in which to retain high morale, satisfy, and reward the employees of the American Automobile Association. Business Reports.