Improving Productivity Coastal Bank is a large bank in a southeastern city. As a part of a comprehensive internal management study, Harris Meade, the data processing vice president, examined the turnover, absenteeism, and productivity figures of all work groups in the organization. The results Meade obtained contained no real surprises except in the case of the check-sorting and data-processing departments. The Research The inquiry revealed that in general the departments displaying high turnover and absenteeism rates had low production figures, and those with low turnover and absenteeism were highly productive.
No surprise there. When analysis began on the check-sorting and data-processing figures, however, Meade discovered that both departments were tied for the lead for the lowest turnover and absenteeism figures. What was surprising was that the check-sorting department ranked first as the most productive unit, whereas the electronic data-processing department ranked last. That inconsistency was further complicated by the fact that the working conditions for check-sorting employees are extremely undesirable.
They work in a large open room that is hot in the summer and cold in the winter. They work alone and operate high-speed check-sorting machines requiring a high degree of accuracy and concentration. There is little chance for interaction because they all take rotating coffee breaks. The computer room is air-conditioned, with a stable temperature year round; it has perfect lighting and is extremely quiet and comfortable. It was known that both groups are highly cohesive and that the workers generally function well with others in their department.
This observation was reinforced by the study’s finding of the low levels of turnover and absenteeism in both departments. The Interview Data In an effort to understand this phenomenon (similar productivity despite vastly different conditions), Meade decided to interview the members of both departments. Meade hoped to gain some insight into the dynamics of each group’s behavior. It was discovered that the check-sorting department displayed a great deal of loyalty to the company.
Most of the group was unskilled or semiskilled workers; although they have no organized union, each person felt that the company had made special efforts to keep their wages and benefits in line with unionized operations. They knew that their work required team effort and were committed to high performance. A quite different situation existed in the data-processing department. Although the workers liked their fellow employees, there was a uniform feeling among this highly skilled group that management placed more emphasis on production than on staff units.
It was their contention that pay increases had been better for operating departments and that the gap between the wage earners and salaried employees did not reflect the skill differences. Because of that, a large percentage of the group displayed little loyalty toward the company, even though they were very close among themselves. The Challenge There is some degree of urgency to improve productivity in this situation. A major competitor in the region is increasing its market share, while Coastal Bank’s market share is trending downward in the last two quarters.
One challenge the bank faces is how to make the data-processing unit more productive. Other low-performing departments may need focus as well, particularly in the areas of absenteeism and turnover. It is possible that system-wide change may be needed. You are Harris Meade and you are tasked with improving productivity throughout the bank: HOW do you decide on the best course of action? What is the best method to make the decision? HOW do you implement any change that may be needed? Suggestion for use: have learners answer the case study individually.
Then break them into small groups to discuss and come to some consensus. There is no “right” or “wrong” answer in this case study, as is true of many leadership decisions. The best a leader can do is to align with organizational priorities, seek the input of others, develop reasonable plans, and try to make a thoughtful decision. It is probably a good idea, in this case, to appoint a cross-functional team composed of workers from each department and other bank departments, too, to make recommendations to management.