Riordan Manufacturing

Running head: PROBLEM SOLUTION: RIORDAN MANUFACTURING

Problem Solution: Riordan Manufacturing

ML

University of Phoenix

Problem Solution: Riordan Manufacturing

Riordan Manufacturing is a global plastics producer employing approximately 550 people. The company has divisions in Albany, Georgia, Pontiac, Michigan, San Jose, California and Hangzhou, China. Riordan has experienced some pitfalls over the last few months due to declining sales, uneven profits and an exodus of some of its key people. All of these factors have led to a significant morale issue with Riordan’s employees. Most of management is concerned that if something is not done to stem the current tide that Riordan will loose more key people. Company CEO, Michael Riordan has in the past been oblivious to these issues, but is finally seeing that he must do something. However, Riordan is unsure what course of action to take to stabilize the situation.

Situation Analysis

Issue and Opportunity Identification

Riordan Manufacturing Company is an industry leader in the field of plastic injection molding manufacturing various types of plastics for a number of uses. The products Riordan manufactures include plastic beverage containers, fans, heart valves, medical stents, and customer custom plastic parts. The company currently employs 550 employees and has four facilities in different demographic locations.

Internally, Riordan has many human resource (HR) issues that are creating productivity and morale issues. Many of Riordan’s HR systems and processes that are not supportive of the company’s strategic business goals and vision, and are in dire need of being redefined and adjusted to reflect the strategic business vision.

Riordan currently has no succession plan for employees allowing them to grow in their position and rise within the company. Riordan has sporadic training and development opportunities which are not conducive to developing and maintaining quality employees. The pay scale is below market in some cases, which contributes too much of the employee turnover. Riordan has great inconsistency and inequity in their system of rewards and bonuses. Incentives and bonuses are being distributed inequitably as they are being distributed on a seniority basis. This perceived inequity is creating low employee morale. Riordan is also doing most managerial hires from outside of the organization. All of these elements are contributing to the HR problems facing Riordan, and will continue to impact the employee morale, and productivity.

Stakeholder Perspectives/Ethical Dilemmas

Riordan must address its internal problems not only for the sake of the company itself, but also for the sake of its employees. Because of Riordan’s practice of hiring managers from outside the company its employees are dissatisfied and potentially preparing to seek employment outside the company. If Riordan wants to keep its key people, the employees must feel like they stand a chance of growth within the company itself.

According to the HR personnel, Exit interviews have indicated that pay and compensation issues are causing the additional frustration, which is causing the problem with attrition. In its handbook, Riordan is on the record as offering competitive salaries within the labor market. However, there have been some indications that Riordan is not offering compensation and pay that is competitive with its competition. Riordan’s employees feel they are not receiving pay that is equitable to similarly situated employees in other organizations within the area.

CEO Riordan has always thought he was offering competitive pay, however in the last few months, he has come to believe that may not be the case. Riordan’s pay scale is apparently below the comparable employer’s pay scale within the market area and industry (University of Phoenix, 2006). Riordan wants to remain competitive in the industry, but he is unsure of exactly how to address these problems.

Problem Statement

Riordan’s HR problems are starting to affect its bottom line. In order to stay competitive in a global marketplace, Riordan must find a way to stem attrition to keep its key people from taking their talent to its competitors. Riordan has many directions it can take to address these issues, and the process