Organizational Behavior: A Case Study of Tony’s Place

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
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