Term Paper: Employees and Motivation

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Employee Motivation Study Proposal

Axis manufacturing is a 5000 employee facility that specializes in the manufacture of aircraft components for the U.S. military. Recently, orders have increased to the point where management is hard-pressed to meet production quotas. They must find a way to motivate employees to meet new production expectations. To compound problems, there has been a rash of low morale among line workers that has also affected the quality of parts produced. This proposal outlines research to determine which of three new proposed pay and incentive plans will boost morale and production so that the company can meet expectations.

Problem and Purpose of the Proposed Study

Axis Manufacturing is a 5000 employee sub-contractor that produces aircraft components for the U.S. Military. Recently, Axis supervisors have noticed a considerable drop in employee motivation among line staff. The factory is a 24 X 7 operation with three working shifts. The standard working day is 8 hours. Due to the War on Terrorism, production demands have increased and workers must meet much higher quotas then before the war began.

The 24 X 7 model works from a financial standpoint, as it reduces the need for overtime, but the workers must now move at a faster pace to produce more during their shift. This has been good in terms of revenue, but it has taken a toll on the employees. The mean age of the employees is 35 years. They have been with the company for 7 years. This translates into a group of workers that are experienced and efficient with their jobs.

However, the turnover rate has doubled in past six months. In experienced employees have been blamed for increases in rejected parts by QC. This has had the net effect of decreasing total production. If this scenario continues, it could place the government contract in jeopardy. If this happens, it could have devastating effects on the ability to continue operations. Human resources must work with management to find a way to motivate employees and reduce turnover rates.

This has failed to motivate employees to the higher production levels needed to fulfill the demands of the new contract. This study will explore three different pay scenarios to determine which would be the most effect in motivating employees to the needed production levels. The purpose of this study will be to determine which pay scenario should be implemented in order to achieve company goals.

Hypothesis and Research Questions

There are many sources of motivation for employees. Worker morale has a direct correlation with productivity and profitability (Cowling, Mitchell, & Watts, 2006). There are many factors that influence employee motivation, some of them are extrinsic to the work place, such as family problems. However, there are some that can be controlled such as pay scale, providing a pleasant work environment, and incentives (Neff, 2002). The hypothesis for this research project stems from the connection between pay, financial stability and reduced stress. Financial problems were found to be a contributing factor in family stress (Mckay, 2006). The rationale for this research is based on the concept that reducing financial hardships among workers will lead to less overall stress in their lives. This will in turn boost morale, leading to increased productivity.

The hypothesis for this study will explore the potential effectiveness of three proposed pay scenarios. The goal of this research is to determine which of these three scenarios will lead to the greatest increased employee morale, and consequently to higher production levels. Production levels cannot be measured at this time and will have to be assessed after the new pay plan is in place to determine if it had the desired effect. The three different pay scenarios are hourly, hourly wages plus incentive pay, and weekly salary.

The proposed research will explore the following hypotheses.

H1: Higher hourly wages will result in statistically significant higher employee morale.

H?1: Higher hourly wages will not result in statistically significant higher employee morale.

H2: Hourly wages combined with incentive pay will result in statistically significant higher employee morale.

H?2: Hourly wages combined with incentive pay will not result in statistically significant higher employee morale.

H3: A weekly salary will result in statistically significant higher employee morale.

H?3: A weekly salary will not result in statistically significant higher employee morale.

In addition to testing each of the above hypotheses and null hypotheses, the research will address the following research questions.

Which of the three proposed pay methods will result in the greatest increase in employee morale?

How much of a pay increase will be needed to achieve the desired increases in productivity?

How likely is implementation of the selected pay formats to result in the desired increase in production?

The goal of this research is to find solutions to an important managerial problem at the company. Finding the answers to these questions is imperative, if the company wishes to continue to provide excellent service to its number one customer. The results of this study will focus on providing answers to the questions that management has regarding the best method to increase employee morale, and thus, productivity.

Definition of Terms

The following terms will be important to understanding the scope and limitations of the proposed research study.

Hourly employees. This term refers to those employees that receive an hourly pay rate for the work performed. In the case of this firm, it refers to line workers and line supervisors.

Incentive pay. Pay in addition to an hourly work rate that is based on performance and production levels.

Morale. This term refers to a feeling of job satisfaction that inspires the employee to higher levels of production.

Production goals. The production goals of the company will be measured in terms of increases in the number of parts produced that pass QC inspection and are deemed ready for final shipment to the customer.

Salaried employees. Those employees that receive a salary, rather than an hourly pay rate for the work performed. All of these employees are off-line production technicians, and managers.

Methodology

Sampling Design

The company employs 5000 workers with an equal distribution of males and females. The average pay for hourly employees is $45,000 before tax. The average employee has been with the company for an average of 7 years. The purpose of this study is to examine the pay method that would be likely to produce an increase in productivity. There are certain categories that will be excluded from the study, as they do not represent hourly employees with the chance of increasing production. The study will exclude salaried employees, office, personnel, managers, and those that are not working directly on the lines to produce parts. This leaves a sample pool of 5000 employees.

The goal of the sampling technique is to maximize the precision per unit cost, while still representing a wide area of the sample population. This project will utilize simple random sampling protocol as the preferred method for this study. This method is easily achievable in this setting as there is a list of research candidates available through Human resources. Simple Random Sampling Method is the most accurate for statistical purposes. However, it has a key disadvantage in that the researcher cannot control for biases that may be present in the sample population. It will be much more difficult to detect skewness with this sampling technique. However, a sufficient sample size should eliminate these problems sufficiently.

It is the goal of the study to gain as accurate picture as possible of the opinions of the worker population. The sample population must be representative of the employee population of concern. Simple Random Sampling Method will be the best method for achieving a population that represents the sentiments of the entire hourly employee population. It is important to get enough information to represent the entire population, without adding undue additional expense to the project budget. The goal of the project will be to sample 20% of the hourly employee population. This would mean a sample population of 1000 employees. This is considered to be an adequate sample population, without causing undue expense.

Research Design

The sample population can be divided into males and females. There may be differences in opinion that are gender based that may effect the results of the study. A two-group posttest-only randomized experimental design will be used to measure the distributions of these two study groups. It will examine the statistical difference between the two groups in relation to the distribution of the entire sample population. This will help the research to distinguish differences between these two sub-groups in the sample population. One-way Analysis of Variance (ANOVA) will be used to examine the differences between the groups.

In this study, as survey will be administered to a select group of randomly selected hourly employees. In theory, the best design for this type of study would be to divide the group into three groups and then study their productivity. However, employee laws and Union labor laws will not permit the company to randomly differentiate… [END OF PREVIEW]

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