Running head: PROBLEM SOLUTION: RIORDAN MANUFACTURING
CORPORATION
Problem Solution: Riordan Manufacturing Corporation
MBA/530- Human Capital Development
May 10, 2006
University of Phoenix
Problem Solution: Riordan Manufacturing
Employee motivation is an issue that does not discriminate. Organizations of all sixes
wrestle with it, and those who dont are at a disadvantage, faced with lower job satisfaction
and increased turnover (University of Phoenix, 2006). This is exactly the situation that
Riordan Manufacturing is facing. Michael Riordan, CEO, is aware that a drastic change is
needed, either to completely overhaul the reward system, use piecemeal solutions to
address the most critical issue, or find a new motivation strategy (University of Phoenix,
2006). Beginning, by paraphrasing the situation background, a description of key issues
and opportunities facing Riordan can be identified. The perspectives of stakeholder needs
as well as the values and rights that have lead to ethical dilemmas in the company will be
identified. Thus, a definition of the problem statement can be developed that allows for
multiple solutions, and future focused on meeting the end-state goals of Riordan. Let begin
by explaining the situation that is occurring with Riordan Manufacturing
Situation Background
Riordan Manufacturing is a global plastics producer that earns over 46 million annually
and employees over 500 people. A fortune 1000 enterprise, Riordan receives a reported 1
billion dollars in revenue. Due to declining sales and profits over the past two years, the
company has decided to implement several strategic changes in the way it markets and
manufactures and markets its products (University of Phoenix, 2006). Michael Riordan,
CEO of Riordan, has decided to start by revamping its sales process and adopting a
customer-relationship management system. The achievements of an organization are the
results of the combined effort of each individual (University of Phoenix, 2006). The CRM
would mean that focus teams, consisting of sales person, product engineer specialist, and
customer service representatives would service customer not single salespersons.
In the manufacturing department, Riordan implemented a Six Sigma quality approach
(University of Phoenix, 2006). This approach redirected work to other facilities as well as
restructured work teams. However, these new changes have caused a decline in employee
retention. According to Dreher and Dougherty, Individuals will be influenced by the task
demands and reward system from the organization and assigned job. Employee surveys
also revealed a decrease in job satisfaction, compensation, and benefits. The current
reward system is not solely based on performance, but recognizes cost-of-living increase,
seniority and position. Thus, prompting managers to request that a new rewards system be
