7916EHR People Management Case Study

This case study focuses on the challenges faced by Build It Supplies, a construction supplies wholesaler, and its new Sales Manager, Dave. The case details issues with declining sales, poor team morale, and ineffective management practices. It highlights the importance of proper HRM practices, including recruitment, performance management, and leadership. The study also explores the consequences of inadequate HR support and the impact of poor management decisions on employee performance and organizational success. The case study includes compulsory questions that require students to identify relevant HRM concepts, suggest improvements to Dave's management approach, and propose a recruitment strategy for a new Sales Manager.

7916EHR People Management
Semester 2, 2016
Assessment Item 3: Timed Case Study
Problems at Build It Supplies
Three months ago, Dave joined NSW-based construction supplies wholesaler, Build It Supplies, as
the new Sales Manager for Queensland to replace the previous sales manager, a highly experienced
sales professional, who had left to join a larger firm. The company has a small HR department in
Sydney but its role has been traditionally confined to managing the payroll and administration of
personnel records. Recruitment and selection of key staff has largely been conducted by Build It
Supplies’ management through personal contacts. Dave had previously been working for one of Build
It Supplies’ competitors as a sales representative. Although he had no managerial experience, he
knew the market well so the Build It Supplies manager that selected him thought he seemed a good
choice for the job.
Build It Supplies has been in business for twenty years and sells construction products to large
construction companies through to individual residential builders. There are plans to grow the
Queensland market over the next five years and to establish several regional offices. Because of the
industry, most of the staff are men, although there are several women in administrative and customer
service functions. When Dave assumes his role as State Sales Manager he inherits a team of fifteen
male sales representatives who report directly to him. There are also three full-time female
administrative staff, and one female and two full-time male customer service officers, however they do
not report directly to Dave. Many of the sales reps have experience in the construction industry and at
least half have previously been a builder or some other trade, such as a plumber.
The sales reps have individual targets and remuneration for the sales reps is based on a combination
of a modest wage and attractive bonus. The sales reps are paid a bonus based on their individual
annual sales and each year at the Christmas lunch the bonuses are awarded and the individual
amount each sales rep receives is disclosed to everyone. The purpose of this has been to celebrate
achievement and encourage a high performance culture. The sales rep team members are all pretty
good performers, however since Dave joined the company, sales have gone down. Dave believes this
is due to a recent decline in construction in Brisbane, and thinks that in the New Year construction will
pick up and so will sales. Dave isn’t looking forward to the looks on his sales reps faces though when
they receive their annual bonus in a couple of weeks time, which for most of them will be the lowest in
six years.
Dave is really worried about a few of his sales reps who have had very low sales recently and thinks
it’s more than just the construction downturn. One sales rep, in particular, is Barry who was hired by
the previous manager and was a personal friend of the previous manager. Dave has been keeping an
eye on Barry since he got here. Barry does not always meet his sales targets, and is occasionally late
to work. After 2 months Dave is convinced that Barry doesn't really understand the job, even though
he is the oldest in age and one of the longest serving employees. His product knowledge is not
always current and he appears incompetent at using a computer and the company’s internal software
programs that all employees are expected to use. Although he has good relationships with his
established clients, he seems unable to build new client relationships. Dave wonders why Barry
cannot just get on with it, like the other sales representatives, and wonders if maybe he is too old for
the job. Dave has been reluctant to talk to Barry about this until recently but now has had enough. He
decides that Barry has to go! He tells Barry what he thinks of his performance in no uncertain terms
and threatens him with dismissal if he does not improve. Barry resigns and departs the same day.

A year later things have not improved. Dave has personally head hunted a replacement for Barry and
fired and replaced another member of the original sales team but the latest recruits are not performing
any better than their predecessors and the team’s morale is sinking – along with their sales results!
The all-Caucasian male sales reps are very competitive with each other, often “stealing” other sales
reps’ customers. Over the past year Dave has been reprimanded several times for bullying and firing
staff without good reason or sufficient evidence, landing the organisation in one case in expensive
legal proceedings. The administrative and customer service officers have also been dissatisfied and
don’t like the way Dave speaks to them. The female customer service officer, who had been studying
marketing at TAFE part time, left after not being considered by Dave for an internal promotion to fill
the sales rep position.
Dave’s boss finally calls him in and warns him that if he does not rebuild relationships with his team
and improve their performance within the next two months he will have to leave. Frustrated and
unable to see how he can improve the team’s performance, Dave decides to leave the organisation
the same day, saying in his brief exit interview that he cannot cope with the stress and pressure.
Since Dave’s departure, Build It Supplies has found it difficult to fill the role of Sales Manager
Queensland and a member of the sales team has to manage the role on a temporary basis. The
organisation has decided it needs to find a permanent replacement for Dave and that it probably
should try more orthodox recruitment and selection methods than it has in the past. The new Sales
Manager will need to have the capacity to build a high performance culture and improve the morale of
the team. Hoping to get it right this time, the HR department has put together the following
information:
Main responsibilities
Manages sales of the company’s products and services within a defined geographic area. Ensures
consistent, profitable growth in sales revenues through positive planning, deployment and
management of sales personnel. Identifies objectives, strategies and action plans to improve short-
and long-term sales and earnings.
Key Accountabilities / Duties
1. Collaborates with senior management and others in establishing and recommending the most
realistic sales goals for the company.
2. Manages an assigned geographic sales area to maximize sales revenues and meet corporate
objectives.
3. Performs sales activities on major accounts and negotiates sales price and discounts.
4. Establishes and manages effective programs to hire, compensate, coach, appraise and train
sales personnel and sales support staff.
5. Accurately forecasts annual, quarterly and monthly revenue streams.
Selection Criteria
1. 10 years' relevant experience in sales and/or management.
2. Experience in preparing sales budgets and targets, analysing sales patterns and providing
advice and feedback on effective sales strategies
3. Capacity to provide timely, accurate and insightful sales reports to senior management.
4. Demonstrated ability to provide leadership in a sales team and well-developed interpersonal
skills.
5. Ability to handle stressful working conditions, short timeframes and demanding customers.
Compulsory Questions:

1. Identify and briefly explain the HRM concepts and practices that you consider would be
relevant to the case above. Explain their relevance and how they can be applied to this case.
(Hint: when answering this question do not limit your answer to just one or two key areas -
draw on the knowledge you have obtained across the course ) 20 marks
2. If you were Dave, what should you have done over the period of time you were manager to
help improve Barry’s performance and the performance of the team? (Hint: Your answer
should demonstrate your breadth of understanding about HRM and the integration of its
activities.) 15 marks
3. Assuming that the description of the job (above) is accurate, explain how you would go about
recruiting for the Sales Manager job. Discuss the selection technique/s you would recommend
be used to choose the best applicant for this job and provide details (in terms of specific
selection/assessment techniques) of how you would measure each applicant’s ability to meet
each selection criterion. 15 marks

KEY POINTS –
The company has a small HR department in Sydney but its role has been traditionally confined to
managing the payroll and administration of personnel records.
Recruitment and selection of key staff has largely been conducted by Build It Supplies’ management
through personal contacts.
Dave had previously been working for one of Build It Supplies’ competitors as a sales representative.
Although he had no managerial experience, he knew the market well so the Build It Supplies manager
that selected him thought he seemed a good choice for the job.
Because of the industry, most of the staff are men, although there are several women in
administrative and customer service functions.
The sales reps are paid a bonus based on their individual annual sales and each year at the
Christmas lunch the bonuses are awarded and the individual amount each sales rep receives is
disclosed to everyone. The purpose of this has been to celebrate achievement and encourage a high
performance culture. The sales rep team members are all pretty good performers, however since
Dave joined the company, sales have gone down. Dave believes this is due to a recent decline in
construction in Brisbane, and thinks that in the New Year construction will pick up and so will sales.
Dave isn’t looking forward to the looks on his sales reps faces though when they receive their annual
bonus in a couple of weeks time, which for most of them will be the lowest in six years.
Employees' improved performance is evidenced strongest when demonstrated by strong leadership
and effective human resource management strategies which target employee motivation, inspiration
and positive attitude to work. These strategies are enabled through a performance management
framework which includes goal setting, rewards, promotional opportunities and staff appreciation.
Using these human resource management levers provides opportunities for employee development
and innovation at work.
The traditional PA HRM technique to assess and improve performance is not particularly effective and
in some cases may negatively impact on employee performance. Whilst, the BSC and multisource
feedback each have some positive impacts on performance, they are not as effective as FFI at
improving employee performance. By focusing on positive employee experiences and success
stories, the FFI is able to get greater improvement in performance over the traditional PA. The FFI
also requires very little training of managers, making it easy for organisations to adopt. The FFI would
prove as a useful HRM technique for organisations to adopt to assess and improve the performance
of employees.

Importantce
HRP has been described as getting the right
people in the right place at the right time to
meet present and future organizational
needs. In rapidly changing markets how can
organizations ensure that
• they predict their future people needs as
accurately as possible ?
• the people they recruit have the right KSAs
to match their current and predicted needs?