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Howe 2 Ski Resort Case Study

Shannon Clark 001149813 September 19, 2011 Mgt 2030 Section C Case Study One: Howe 2 Ski Stores 1. The main problems occurring in the Howe 2 Ski Stores were that ski orders were  delivered a couple days late, customers waited to receive help from the clerks because  they were engaged in conversations among themselves, employees complained how merit pay was only given to the moulders and as a result the other employees were not as  focused on customer service as expected. Another main problem of the work place was  how the employees did not charge all customers for the damaged equipment because of  how poorly maintained the records were.  The main problems are equal between the personality and characteristics of the work  environment. The employees slack off and do not help their customers to what is  expected, and are very talkative between each other. This may be because they do not  receive merit pay; therefore they do not work as hard as they should. That is a  characteristic of the workplace. Another characteristic is that the ski orders are often  delivered two days late due to the lack of communication between the employees and the  moulders.  The personality problem is equal to the characteristics of the work  environment because the employees have a poor watch for damaged ski equipment, and 

Howe 2 Ski Compensation/Merit Based Plan

Summer 2011 - Compensation Exercise

1. What was the problem with the merit-based pay plan that Howe 2 Ski Stores was
using?

2. What alternative compensation plan would you recommend (i.e., gainsharing, profit sharing, ownership, incentives, balanced scorecard, etc.) to help solve these issues? Please be specific about how this plan will be implemented.

3. What are the advantages of your new plan?

4. What disadvantages are there to your new plan?

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Solution Preview

Summer 2011 - Compensation Exercise

1. What was the problem with the merit-based pay plan that Howe 2 Ski Stores was
using?
The problem with the merit based pay plan was that it singled out a particular department (thus being unfair to rest of employees), was not closely monitored, caused discontent among all, and most importantly did not increase long term performance for the molders. In addition, it caused further unhappiness and service issues.

2. What alternative compensation plan would you recommend (i.e., gainsharing, profit sharing, ownership, incentives, balanced scorecard, etc.) to help solve these issues? Please be specific about how this plan will be implemented.

I would suggest a profit sharing plan in which five or ten percent of the individual store's profit is rebated back to all employees. ...

Solution Summary

This solution discusses a case study involving Howe 2 Ski Stores and their merit based pay plan. It suggests an alternative compensation plan, its' implementation, advantages and disadvantages. It includes examples.

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