Application of motivation concepts in a modern organization

Motivation importance is another approach for modern organization that can provide following benefits. First of them is ability to put human resources into action. Every concern requires physical, financial and human resources to accomplish the goals. It is through motivation that the human resources can be utilized by making full use of it. This can be done by building willingness in employees to work. This will help the enterprise in securing best possible utilization of resources.

The second is represented by employees’ efficiency level improvement. The level of a subordinate or a employee does not only depend upon his qualifications and abilities. For getting best of his work performance, the gap between ability and willingness has to be filled which helps in improving the level of performance of subordinates. This will result into increase in productivity, reducing cost of operations, and improving overall efficiency.

Next is the fact that motivation leads to achievement of organizational goals.

The goals of an enterprise can be achieved only when the following factors take place : presence of best possible utilization of resources, co-operative work environment, employees are goal-directed and they act in a purposive manner, and goals can be achieved if co-ordination and co-operation takes place simultaneously which can be effectively done through motivation.

Another fact is that motivation leads to stability of work force. Stability of workforce is very important from the point of view of reputation and goodwill of a concern. The employees can remain loyal to the enterprise only when they have a feeling of participation in the management. The skills and efficiency of employees will always be of advantage to employees as well as employees. This will lead to a good public image in the market which will attract competent and qualified people into a concern. As it is said, “Old is gold” which suffices with the role of motivation here, the older the people, more the experience and their adjustment into a concern which can be of benefit to the enterprise.

From the above considered, it can be concluded that motivation is an internal feeling which can be understood only by a manager since, he is in close contact with the employees. Needs, wants, and desires are inter-related, and they are the driving force to act. These needs can be understood by the manager, and he can frame motivation plans accordingly. Motivation, therefore, is a continuous process, since motivation process is based on needs which are unlimited. The process has to be continued throughout.

It can be summarized by saying that motivation is important both to an individual and a business. Motivation is important to an individual as:

• Motivation will help him achieve his personal goals.
• If an individual is motivated, he will have job satisfaction.
• Motivation will help in self-development of individual.
• An individual would always gain by working with a dynamic team.

Similarly, motivation is important to a business as:

• The more motivated the employees are, the more empowered the team is.
• The more is the team work and individual employee contribution, more profitable and successful is the business.
• During period of amendments, there will be more adaptability and creativity.
• Motivation will lead to an optimistic and challenging attitude at work place.

It could be concluded that motivation in a today organization cannot be overemphasized. Motivation now serves as a vital tool to get the aims, goals and objectives of an organization achieved. In different modern organizations this motivational tools are used not the same way. In order to be successful, organizations choose the best one and apply it with consideration of its employees’ features. Despite everything, the main essence of motivating tools remains the same and bases on content, process and modern theories of motivation. Analogy of theories of motivation and its practical use in a modern organization is considered in Chapter 2 by the example of “adidas Group” Ltd Company.

 

 

 

 

CHAPTER 2. ANALYSIS OF MOTIVATION CONCEPTS APPLICATION IN “ADIDAS GROUP” LTD

 

2.1 Analysis of business activities in “adidas Group”

 

Adidas AG is a German multinational corporation that designs and manufacturers sports clothing and accessories based in Herzogenaurach, Germany. It is the holding company for the adidas Group, which consists of the Reebok sportswear company, TaylorMade-Adidas golf company (including Ashworth), and Rockport. Besides sports footwear, Adidas also produces other products such as bags, shirts, watches, eyewear, and other sports- and clothing-related goods. Adidas is the largest sportswear manufacturer in Europe and the second biggest sportswear manufacturer in the world.

Adidas was founded in 1948 by Adolf Dassler, following the split of Gebrüder Dassler Schuhfabrik between him and his older brother Rudolf. Rudolf later established Puma, which was the early rival of adidas. Registered in 1949, Adidas is currently based in Herzogenaurach, Germany, along with Puma.

Newsday’s “adidas Group” company goal as a Group is to lead the sporting goods industry with brands built upon a passion for sports and a sporting lifestyle. Inspired by their heritage, they know that a profound understanding of the consumer and customer is essential to achieving this goal. To anticipate and respond to their needs, adidas all over the world continuously strive to create a culture of innovation, challenging their selves to break with convention and embrace change. By harnessing this culture, they push the boundaries of products, services and processes to strengthen company’s competitiveness and maximize the Group’s operational and financial performance. This, in turn, will drive long-term value creation for organization shareholders.

Company’s culture is continuously shaped by influences from the past and the present as well as their future aspirations. The whole corporation wins as a team through open communication, collaboration and shared values found in sport /11, p.60/. Therefore, a corporate culture of performance, passion, integrity and diversity by creating a work environment that stimulates innovation, team spirit, and achievement based on strong leadership and employee engagement are strongly promoted in company.

Creating long-term value for adidas Group shareholders through significant operating cash flow generation drives overall decision-making process. Therefore, company is focused on rigorously managing those factors under control, making strategic choices that will drive sustainable revenue and earnings growth, and ultimately operating cash flow. Across its operations, managers pursue the avenues for growth which expect to be most value-enhancing, with particular emphasis on improving group profitability. In addition, rigorously managing working capital and optimizing capital structure remain key priorities for organization. Furthermore, it is committed to increasing returns to shareholders with above-industry-average share price performance and dividends.

As a Group, adidas targets leading market positions in all markets where it competes. However, it has been prioritized to invest based on those markets which offer the best medium- to long-term growth and profitability opportunities. In this respect, it is placed a considerable emphasis on expanding activities in the emerging markets, particularly China, Russia and Kazakhstan, as well as building market share in underpenetrated markets for the Group such as the United States No matter in which market company operates, it recognizes that consumer buying behavior and the retail landscape are unique. Therefore, to fully exploit market opportunities, it tailors distribution strategy to present brands to the consumer in the most impactful way. This is achieved by following a distinctive but coordinated channel approach. To this end, Group strives to provide customers with superior service to secure prime shelf space for brands, while continuing commitment to building a strategic competency in retail and e-commerce.

Every “adidas Group” Ltd. employee is responsible for driving innovation. Therefore, it fosters a culture of challenging convention and embracing change, and requires all areas of the Group to generate at least one new innovation or meaningful improvement per year. In particular, leaders believe that technological evolution and cutting-edge design in products are essential to achieving sustainable leadership in the industry. Beyond this, enhancing services for customers and implementing more efficient and effective internal processes are other areas where organization strives to innovate /11, p.71/.

In Russia, Ukraine and Kazakhstan (CIS region), “adidas Group” Ltd is responsible for the marketing and distribution of adidas, Reebok, Rockport, Reebok-CCM Hockey as well as TaylorMade-adidas Golf. In Kazakhstan and CIS, the company is considered to be number one in the sports goods market and one of the leading retail companies with a chain of more than 700 corporately owned stores. In Kazakhstan headquarters are based in Almaty. The Company currently have 10,000 employees in CIS; the vast majority of them working in own stores. Adidas brand stores are located in 16 cities of Kazakhstan, and their total number was 53 in 2011.  More than 700 employees are working for the company.

HR Department of organization is very important. In “adidas Group” Kazakhstan Human Resources Department covers following key roles:

• Executive role – in this role the HR department are viewed as the specialists in the areas that encompass Human Resources or people management.
• Audit role – in this capacity the HR department checks other departments and the organization as a whole to ensure all HR policies such as Health & Safety, Training, Staff Appraisal etc are being carried out in accordance with the company’s HR policy.
• Facilitator role – in this role, the HR department helps or facilitates other departments to achieve the goals or standards as laid out in the HR policies of the organization. This involves training being delivered for issues that arise in the areas relating to people management.
• Consultancy role – the HR department advises managers on how to tackle specific managing people issues professionally.
• Service role – in this capacity the HR department is an information provider to raise awareness and inform departments and functional areas on changes in policy.

Organizational Chart of HR Department of “adidas Group” Kazakhstan is

represented below.

 

 

 

 

 

 

Figure 4. Organizational Chart of HR Department

 

The employees in the organization are referred to the one of the most important component for the implementation of becoming the global leader in the sporting goods industry strategy.

The main idea in the company that employee satisfaction drives commitment, commitment drives engagement, and engagement drives business performance. Consequently, engagement defined as one of the Group’s key performance indicators for measuring efforts to sustain a “performance culture”.

In 2010 according to the first Group-wide employee engagement survey outstanding participation rate was 90% and an engagement score which places company close to the top-performing organizations within the consumer goods industry. This score was underpinned by employees’ high level of confidence in senior leaders, their perception of clarity concerning the Group’s strategic direction, as well as an open and constructive work climate.

In fight to have the right team in place by focusing activities on the implementation and execution of Group’s Human Resources strategy, “adidas Group” all over the world proposed Three-pillar Human Resources strategy, that include following:

• Creating a working environment that stimulates team spirit, passion, engagement and achievement;
• Expanding performance culture based upon strong leadership;
• Being an “employer of choice” /11, p. 102/.

To reach their personal best, “adidas Group” employees are offered a wide variety of training and development opportunities, building on their strengths, improving their skills and overcoming their own challenges. The highest priority is to match individual employee aspirations with organizational needs. The framework for all development activities is set by the adidas Group Competency Model. Detailed out for all hierarchy levels, it ensures consistent and transparent performance, talent and career/succession management.

Company’s global Performance Evaluation and Planning tool (PEP) is the cornerstone of performance management at the Adidas Group. Based on business targets as well as job tasks and competencies, each employee is evaluated and receives feedback at least once a year. Building on defined development goals, employees are offered and supported with targeted development activities both on- and off-the-job. In 2011, PEP is consistently used in all business units of the Adidas Group. The online version has coverage of 76% Group-wide. The target for the end of 2012 is to reach an online coverage of 96% /11, p.109/.

The Company’s goal is to harmonies the commercial interests of the “adidas Group” with the private and family needs of employees. The Work-Life Integration Programme includes family-oriented services, flexible work time and place, people development and leadership competence related to work-life integration.

As a global company, “adidas Group” attract people with different ideas, strengths, interests and cultural backgrounds to ensure achievement of goals. A high degree of diversity is already represented within the workforce. At our Group’s global headquarters, for example, employees from more than 60 nations work. The Policy structured to assure an environment that embraces diversity through various initiatives, such as networking events, intercultural training and the activities of work-life integration department.

The “adidas Group” has set specific goals which are in line with orporate culture as well as employee structure. It is planned to increase the proportion of women in management to between 32% and 35% by 2015 (currently: 27% worldwide)   that is shown in Table 1. To reach this goal, company is increasing the proportion of women in leadership development programmes to 35% in order to support female employees to take leadership positions in all areas of the company.

At the beginning of the year, the Supervisory Board of adidas AG already committed to increase the degree of female representation to at least three female members at the next election in 2014, with at least one to be on the shareholders’ side.

 

Table 1 - Proportion of male and female workers in the “adidas Group” Ltd.  for 2011

Total number of employees	46,824
Male	50%
Female	50%
Management positions proportion (in %):
Male	73%
Female	27%
Average age of employees (in years)	30
Average length of service (in years)	3.5
Average annual training hours every employee (in hours)	17.0

In addition, the adidas Group is focusing on programmes which give employees with children the option to combine their careers with family life, regardless of gender. For example, since 2002, more than 70 children have been able to attend a child-care facility at company premises in Canton, USA, and a day-care centre for 100 children is scheduled to open in 2013 at the Group’s global headquarters in Herzogenaurach, Germany.

Aspects and practices considered above are relevant and actual for Adidas Group CIS.

 

2.2 Assessment of motivational concepts application in “adidas Group” Ltd. Kazakhstan

 

Motivation is important in keeping employees and getting them to perform above average. Motivating employees can be done in a lot of ways, some more expensive than others but all quite effective. Incentives are motivational tool that is very popular in “adidas Group” Kazakhstan. Incentive is an act or promise for greater action. It is also called as a stimulus to greater action. Incentives are something that is given in addition to wagers. It means additional remuneration or benefit to an employee in recognition of achievement or better work. Incentives provide a spur or zeal in the employees for better performance.

First of all it should be mentioned that Adidas incentives system differentiates with accordance to the category which employee belongs to. These categories are represented by managerial staff and non-managerial staff. Managerial staff incentives in its turn divide to the Grade. The grade is a level that provides a person with a particular package of incentives. The grade usually depends on the position that a person occupies in the company. An example of Grade system subdivision is represented in the Table 2.

For nonmanagerial staff incentives are represented by monetary incentives that include bonuses and monitory rewards that are spread on the competition basis. 

The motivation strategy in “adidas Group” Kazakhstan is constantly developing, and now it has already had special tools and techniques. The reward and incentives system of the company can be considered with accordance to Maslow’s hierarchy of needs.

Based on Maslow's theory Adidas Company has to provide their employees with lower level needs. In order to support first level of hierarchy of needs that includes physiological needs, company should set compatible salary, provide with food during working hours and give good shift to let them live their own life so they can have a rest as well.

The series of incentives that will satisfy need are presented by high rate of the salary, annual bonuses at the end of financial year that vary according to grade employee belong to, 50% reimbursement of dinners, a paid leaf or paid vacation for the managerial staff of the “adidas Group” Ltd. Company. Nonmanagerial staff of the company supported by relatively high level of salary, with comparison to other retail companies, bonuses that are differentiates from month to month, once on half a year or annually. Another way to motivate with bonuses’ system considered to be competition among stores in particular local region, country-wide or even in the CIS scale.

 

Table 2 - Grade system of staff in “adidas Group” Ltd. Kazakhstan.

Positions		Compensations and perks
Grade	Post level	Corporate mobile phone	Corporate car	Medical insurance				Discount cards Limit	Fitness
				Travel abroad		VMI	Accident insurance
Management
M1 - S2	Upper management and  General director	+	+	+	TOP		+	50,000 $	+
M2	Middle management (Divisional management)	+	+	+	Standard		+	25,000 $	+
M3	Middle management (Sub divisional management)	Depends on the character of work	If necessary	+	Standard		+	25,000 $	+
M4	Middle management (Team leaders, project managers)	Depends on the character of work	If necessary	+	Standard		Depends on the character of work	10,000 $	+
SPECIALIST
P1	Senior specialist	Depends on the character of work	-	+	Basic		Depends on the character of work	10,000 $	+
P2	Specialist	Depends on the character of work	-	+	Basic		Depends on the character of work	10,000 $	+
P3	Junior specialist	Depends on the character of work	-	+	Basic		Depends on the character of work	5,000 $	+
P4	Junior specialist	Depends on the character of work	-	+	Basic		Depends on the character of work	5,000 $	+