Fundamental issues
Introduction
This case highlights upon various issues that Tony’s restaurant is battling with. The restaurant initially belonged to Jack Smith who later sold it off to Tony. However, since that day onwards, there are various problems being faced by restaurant customers as well as staff. This report throws light on fundamental issues faced by the firm and certain theories that can be applied to the ongoing situation at the restaurant. Along with that, a few recommendations have been made to resolve respective issues faced.
Fundamental issues
It is clear from the case study that there are various fundamental problems faced by the restaurant. These issues include:
Increased staff turnover: Employee retention is extremely important for the success of any business (Das & Baruah, 2013). Tony’s restaurant is currently battling with high turnover among staff. When staff turnover is high then employers’ cost of recruitment and training increases and the organization’s overall culture gets disrupted. This may even lead to a negative working environment.
Ineffective communication: It has been noticed that the communication process at Tony’s restaurant is highly ineffective. For organizational growth, leaders must open doors to transparent communication within the organization. In this case, Tony is often unavailable and is completely ignorant to the plight of his staff members. Tony gave verbal warnings to his employees and felt disconnected with his employees. Communication forms the backbone of a business. It is important that organizational employees communicate effectively with each other and create a positive working environment for everyone.
Centralized decision making: Another major issue faced by the restaurant is centralized decision making. This signifies that a single person is responsible for making all the decisions (Pettigrew, 2014). In this case, that person is Tony. Tony has been known to make organizational decisions and manage employees. This form of decision making can make employees feel demotivated and disrespected. On the other hand, including employees in the decision making process enhances a sense of ownership. This not only motivates employees but also assists the firm in retaining them.
Demotivated employees: The last issue faced by the restaurant is that the employees are extremely demotivated. Demotivated employees cannot perform to the best of their abilities. Tony’s employees reach to work late or do not show up at all. Their goals are often unrealistic and there is an excessive pressure in them to perform extra work. All this leads to employee demotivation. Employee motivation assists businesses in retaining employees, enhancing performance and creating a positive work place environment.
Theories
Theories
Maslow’s hierarchy of needs theory suggests that an individual has five levels of needs in order to stay motivated (Block, 2011). In the case of Tony’s restaurant, employees were getting their basic salary which may satisfy their physiological and safety needs but the restaurant was completely unable to fulfill any other needs beyond that.
Similarly, Herzberg’s two factor theory of motivation suggests that there are various factors whose presence can motivate employees and there are some factors whose presence may not motivate employees but their absence can surely demotivate employees (Alshmemri et. al., 2017). In this case, employees were getting their basic salaries and job security. But not getting status and proper working conditions is a major demotivation for employees at Tony’s place.
Communication issues
There are various communication issues that are faced by employees at Tony’s place. The channels of communication are highly unclear. Tony does not communicate well with any of his employees. Moreover, there is no way for employees to reach out to Tony or provide any kind of feedback. Employees have no outlet to address any grievances that they might be facing. Moreover, since there is no clear line of communication, everyone behaves independently.
The case also mentioned that Tony did not think it was necessary to listen to his staff. Because the communication between the employee and the employer was highly ineffective, clear goals were not established for the organization. This lack of communication also reduced employee creativity. Tony also communicated verbally and hence if he had to give someone a warning, there was no documentation of the same. Employees felt that he was moody and often either overreacted to problems or he responded ineffectively.
These communication issues were creating a dull working environment at the restaurant and were adversely impacting overall performance of the restaurant. Lack of communication in any organization leads to a negative working environment and often causes conflicts. Therefore it is important that clear lines of communication are established in every business to ensure that employees as well as employers are able to create and maintain transparency in their relationship.
Recommendations
Since the restaurant was a major hit under the leadership of Jack Smith, it is clear that the restaurant has a good ambience and a strong brand value. Before the poor service quality and staff issues at the restaurant take a toll on restaurant’s public image and customer positioning, it is wiser to take some strong steps in the direction of improvement. The following recommendations have been made to assist the restaurant to improve its service:
Communication issues
Improved communication: The foremost problem faced by the restaurant is that of ineffective communication. Therefore the first strategy recommended to the restaurant is to create an atmosphere of open communication. Tony must improve his communication with his employees. It is important that employees feel they are trusted in the business. Employee feedback is also essential for the growth of the firm and that is possible with the help of open communication.
Improved communication will also help the restaurant in increasing collaboration and coordination among employees. When employees work in collaboration like a team, their overall performance would improve. This would further lead to an increasing number of satisfied customers. Communication forms the backbone of every organization and it is imperative that employees are able to conduct transparent and honest communication with one another (Cooren et. al., 2011).
Clear goal setting: At present, employees are forced to do tasks that Tony asks them to do. However, employees are not comfortable with it. For improved employee performances, it is important the clear goals are set for employees (Pinard, 2014). These goals must be decided strategically after discussing the same with the employees. This is important as effective goals can lead to improved employee performance while ineffective goals can cause employee demotivation.
Tony must conduct weekly or monthly meetings with each employee and together they must set goals and targets for the upcoming week/month.
Change in leadership style: Tony’s leadership style is highly authoritative. In this leadership style, the leader tends to make all the decisions and expects everyone to follow (Voon et. al., 2011). This leaves little or no power with the employees. This can be a major source of demotivation among employees. In order to effectively run a restaurant, Tony must adopt a democratic leadership style wherein leader involves followers in the decision making process. This leads to employee motivation and an increased sense of ownership.
Employee retention: Employee retention is highly important especially in the service industry. The restaurant might have various regular customers and these customers would have built a connection with the restaurant staff. Therefore it is highly important the Tony puts efforts in retaining its staff members. This would save cost of training and recruiting new employees (Sandhya & Kumar, 2011). In order to retain employees, the work culture and environment of the restaurant must be improved and employee issues must be addressed in an effective manner.
Employee motivation: Lastly, ensuring employee motivation is highly essential for the success of the organization (Laddha et. al., 2012). The case states that employees reach to work late and often do not show up. This is a clear sign of employee demotivation. Tony must create an environment at work which is collaborative, empowering and performing. Employees must also be given incentives and bonuses for improved performance. This will motivate them to work hard and ensure their longevity with the restaurant.
Conclusion
This case highlights various organizational and communication issues faced by Tony’s restaurant. The employees in the restaurant are highly frustrated under Tony’s leadership. The communication between employees and employers is highly ineffective. Clear goal setting theories have not been adopted yet. This is leading to ineffective service and reduced coordination among employees.
In order to address the same, it has been recommended that Tony changes his leadership style from autocratic to democratic and works towards retaining and motivating employees. The overall communication within the organization must also be improved. This is important to create transparency and improve coordination among employees.
The restaurant’s communication and leadership issues are severe and it is important that they are addressed immediately. The restaurant held a great brand positioning and if efforts are put in the right direction and at the right time, the same can be achieved again.
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