Business Studies
Scenario (fictional):
Artificial Intelligence Medical (i.e., AIM) Inc. is a very profitable new company. Although it has only been in business for 2 years, it has already doubled the size of its workforce and quadrupled its profits. The CEO/founder has stepped aside recently in favor of a new CEO in the wake of employees’ frustration and social media messages about the benefits inequity and lack of motivation for teams at the company. The new CEO wants to change the way executive salaries are determined and find ways to motivate the project teams. The project teams typically are assigned to an artificial intelligence product, such as a robot that performs routine surgeries or diagnostic software used by different medical units of a hospital for patient diagnosis.
The new CEO has tasked your team of employees with determining a general proposed solution to the inequity in pay at the company and to address the lack of motivation for the 125 technicians and medical staff that work in project teams of 25 employees each. Each technician or staff member receives a salary of $45,000 per year, while the CEO and vice presidents (VPs) receive $500,000 per year (the CEO also holds 10% of the company stock), and the managers receive $65,000 per year. There are: a CEO, 2 VPs (manufacturing and finance), a marketing manager, a sales/customer service manager, and a technical support manager.
This is a group project and the part I need to develop is the following:
-Describe the tasks necessary to realize a successful response to the new CEO, allocating tasks for each member.
Course Reference:
Robbins, S. P. & Judge, T. A. (2019). Organizational Behavior (18th ed.). New York NY: Pearson.
ANSWER
Pay Equity and Employee Motivation
The main problem at Artificial Intelligence Medical Inc is employee dissatisfaction regarding the inequity of pay which leads to a lack of motivation among employees. Therefore, the new CEO has a great task ahead to ensure that he puts in place measures that will enhance equity and motivate the workers. The upcoming CEO ought to employ a robust approach to measure each worker and team working on a specific task and the remuneration they deserve.
Human capital is the most critical asset in the modern technology and service industry. Compensation structures and performance incentives have a crucial role in hiring and retaining employees (Robbins & Judge, 2019). Employees need to be treated with equity and compensated equally once they perform the same tasks to be more productive (Inuwa & Idris, 2017). The new CEO should review how the company pays its employees since there is such a vast difference between the salaries of the top management and the rest of the workers leading to their dissatisfaction. The management makes policies and rules to be implemented by the junior employees; therefore, the juniors do most of the work to ensure the company’s success. While compensating, the CEO should also pay attention to factors such as experience level, job performance, and tenure with the company.
Paying employees equitably helps employers increase efficiency, creativity, productivity, and commitment to the organization while reducing turnover. The CEO can motivate productivity by conducting regular pay audits to provide information on pay disparities, why they exist, and whether legitimate, nondiscriminatory reasons can explain them. If the disparities lack a logical explanation, the CEO has a chance to correct that. In addition, the new CEO can introduce bonuses, equity grants, or non-pecuniary benefits further to motivate employees (Bao & Wu, 2017). Happy, satisfied employees become more productive, leading to a company’s success and competitiveness.
References
Bao, J., & Wu, A. (2017). Equality and equity in compensation. Harvard Business School working paper series.
https://dash.harvard.edu/handle/1/32624462
Inuwa, M., & Idris, Z. (2017). Role of Job Equity on Employee Performance. International Journal of Management Science Research, 3(1).
Robbins, S. P., & Judge, T. A. (2019). Organizational Behavior (18th ed.). New York, NY: Pearson.
https://b-ok.africa/ireader/11730257
