By: Jason A. Clements, Joshua Christie, Jeffrey R. Maddox, Gerson E. Viera, and Brook G.

Wall

Table of Contents
Introduction ..................................................................................................................................... 2 Background ..................................................................................................................................... 2 Issues ............................................................................................................................................... 3 Leadership ................................................................................................................................... 3 Motivation ................................................................................................................................... 5 Trust, Justice, and Ethics ............................................................................................................ 6 Stress ........................................................................................................................................... 8 Organization Structure ................................................................................................................ 9 Recommendations ......................................................................................................................... 11 Motivational techniques ............................................................................................................ 11 Transformational Leadership .................................................................................................... 13 Process Improvement ................................................................................................................ 15 Conclusion .................................................................................................................................... 17 Works Cited .................................................................................................................................. 18

Introduction
Stanza Textbooks is a LLC privately owned by Anuj Sehgal. Anuj primarily focuses on online activity which constitutes 80% of the companys revenues. He has delegated all store supervision to the general manager Hoang Nguyen. Hoangs crucial role in the operations of the company makes him highly influential and very difficult to replace. Hoang focuses on creating a positive work environment to reduce the strain employees feel during peak times within a semester. Hoangs flexibility regarding employee needs sponsors trust within the organization. This trust can be highly motivating and beneficial to the productivity and commitment of employees. Within the past several years, Stanza restructured from a geographic to a functional

structure. As the company grows, further changes will need to take place to optimize efficiency considering the design of the organization. To prepare employees for any future restructuring, it would be very beneficial for Hoang to implement motivational leadership techniques, transformational leadership, and process improvement.

Background
Stanza Textbooks was opened in Richardson in 2006. Within a few years, Stanza expanded into Irving and Arlington to service Brookhaven Community College and UT Arlington students, respectively. The Irving location was closed within its first year due to low sales revenue and high labor costs. Shortly after this location closed, Anuj decided to centralize common functions of the company, such as shipping online orders and managing inventory. Each of these functions was moved to the Richardson location. After these functions were consolidated into the Richardson location, it soon became apparent that the store manager in Arlington was no longer needed. Since then, Hoang has been the general manager for the remaining two stores.

3 Although Stanza does not have a formal mission statement, a mission for the organization naturally developed. Stanza places high emphasis on fairness and flexibility for employees and customers. Due to significant cyclical fluctuations in workload needs at Stanza, employees have sporadic work schedules. Hoang hires temporary help for the peak seasons, but he also uses them as a means to accommodate employees scheduling requests. Hoang also believes that textbook prices should be limited to a fair amount of profit. Book prices are set individually based on cost and competitor comparisons. Stanza also price matches local competitors and competes with online retailers to ensure customers receive fair pricing on textbooks. Stanza Textbooks has a functional organizational structure. Employees are divided across functional areas such as shipping, accounting, and inventory records management. As the company grows, Hoang plans on hiring one IT employee and one employee to focus on large clients, such as Amazon and Chegg. Stanza currently maintains a permanent staff of 5-12 employees. Stanza is decentralized and lowly formalized. Anuj allows Hoang to make judgment calls for most decisions pertaining to the store. This allows Hoang to adapt to the various needs of individual employees and customers to make appropriate decisions. Hoang allows employees to make some decisions as well. Hoang is formally given a wide span of control which includes supervision of the Arlington location, but he focuses on the Richardson location. As Stanza expands, the plan is to hire and/or develop employees for the Richardson location who can excel within a flexible environment to maximize the growth and profitability of the company.

Issues
Leadership
Leader effectiveness is a critical component of Stanza Textbooks. Employees place high confidence in Hoangs decisions. Although employees are allowed to make some decisions on

4 their own, it has become commonplace for the employees to go to Hoang for decision-making. Leadership effectiveness is characterized by three types of actions: decision-making styles, dayto-day behaviors, and transactional/transformational behaviors. The most common decision-making style used by Hoang is autocratic with the most significant decisions pertaining to the store made by Hoang. The autocratic style is often an appropriate method of decision making because of Hoangs expertise and the high level of trust the employees have in his decisions. Considering his expertise and the likelihood that employees will follow his decisions, the recommended decision-making style is autocratic. Hoangs level of involvement in his employees work varies throughout the semester. When new employees are hired and/or rehired, Hoang is very involved because this occurs during the busiest times for Stanza. Since Hoang is not the primary trainer for new employees, his involvement would primarily include classified as selling in the Life Cycle Theory of Leadership. During slow periods, staffing is reduced to the more experienced, permanent staff and the employees are able to operate more independently. During these times, Hoang still manages work tasks, but employees are less dependent on his instructions. Transactional leadership with contingent rewards is the primary leadership behavior utilized at Stanza. All employees are eligible for bonuses at the end of each semester. Hoang explains to each employee what they need to accomplish in order to receive the maximum possible bonus. Employees are informally updated concerning their performance to ensure that they understand exactly how they are doing. This method of leadership behavior is the most active and effective form of transactional leadership. Hoangs effectiveness as a leader has a positive correlation with organizational commitment. Permanent employees tend to stay for at least a couple of years and temporary

5 employees often get rehired for multiple semesters. This is likely due to his ability to use appropriate decision-making styles, gauge appropriate levels of his involvement, and actively lead employees.

Motivation
The employees of Stanzas Textbooks remain well motivated while under Hoangs supervision. This is partially attributable to the cash bonuses each semester in addition to paychecks and the challenging work environment. The dynamic and collaborative work environment which Stanza has created helps conscientious worker to have an especially positive work experience. Hoang became an effective supervisor by learning from jobs which had negative work conditions. These previous work experiences enabled him to gauge his subordinates stress, coordinate work tasks efficiently, and create a positive environment. This environment has naturally formed to allow employees to have high levels of expectancy and instrumentality. Hoang has his employees undergo a two-week training program each semester led by a highly experienced employee. By training and re-training employees each semester, employees are able to develop into more capable and autonomous employees. Hoang then motivates workers by offering cash bonuses. Hoang monitors his workers productivity and offers regular feedback to help employees reach company goals and obtain their bonus. Employees will only lose their bonuses if they have too many mistakes. Introducing this challenge stressor helps employees to prevent any monetary losses and motivate them to exercise caution. Employees were asked what causes them to work harder. Several of them responded saying that they work harder when there is a specific goal that they have to meet. They claimed that they would work their hardest whenever there is a shipment deadline for a large quantity of

6 books. One employee has been known to work over 80 hours per week. Although he is young, he is highly motivated because he is given the chance to face high work responsibilities and become competent in his tasks. Stanzas employees claim that they like to work there because of the extra money it provides for them while they progress academically. Once they become autonomous and develop their competence, their expectancy is satisfied while working at Stanzas. The bonuses they receive for performing well will then increase their instrumentality by providing a positive valence.

Trust, Justice, and Ethics

Creating trust is a very important process between the employer and employees. Stanza employees cognitively trust Hoang due to his benevolence and integrity. Some employees have needed to work for 20 plus hours on any given day. When this occurs, Hoang works the extra hours with the employees. Through this act, Hoang tries to help employees personally through the most stressful aspects of their jobs. This demonstrated benevolence for the well-being of the employee improves the levels of cognition-based trust which the employees will have for Hoang. Also, the employees specifically expressed that Hoang has high levels of integrity. One employee expressed that he trusts Hoang more than he trusts most people. This trust is reciprocated by Hoang toward his employees. He has allowed one shipping employee in particular to operate quite independently despite his young age. This trust has deepened over time due to very few unexplainable inventory discrepancies. The mutual trust which has developed will positively impact the job performance and organizational commitment of employees. Specifically, employees are more likely to engage in citizenship behavior such as

7 volunteering for assignments without being asked. They will also be less likely to conduct counterproductive behavior when they trust their authorities. Employees also need some sort of behavioral evidence to show that an authority can be trusted. Hoangs institution of performance-based bonuses is a demonstration of distributive justice. He tries to make it equitable by clearly communicating employee goals to minimize mistakes within their control. It is also important for employees to be able to voice their opinions and views. Hoang has had employees express concerns regarding the fairness of a given situation and it has led to corrective action. These demonstrations of distributive and procedural justice help increase the trust employees have which additionally contributes to improved organizational commitment and job performance. Purchasing books at the beginning of the year is extremely difficult and expensive; a recent report form USA Today stated that the average cost of textbooks for a year of college is $1,168 (Funt, 2012). Many student and lawmakers across the country have heavily debated the questionable morality of textbook pricing. Management at Stanza Textbooks clearly recognizes the high retail price of books and the ethical issues behind such high prices. Hoang stated in an interview that manually set pricing allows the best price to be given to students while still making a profit. He accomplishes this by comparing prices among competitors such as the oncampus book store, Off-Campus books, Amazon, and Chegg. Stanza demonstrates moral judgment by recognizing the ethical ramifications of textbook pricing. The tedious pricing process then demonstrates moral intent to practice honest and tolerable pricing. This is also an effective business model as it attracts returning customers which increases profits. The ethical behavior demonstrated by Stanzas leadership will sponsor citizenship behavior among employees and develop a positive company reputation.

8 The components of morality demonstrated by Stanza Textbooks help demonstrate to employees that the leaders are trustworthy. The ethical behaviors are also shown to employees through distributive and procedural justice. This contributes additionally to employees perception of leader trustworthiness. As employees develop higher levels of trust for their leaders, they will become more committed to the organization and exhibit higher levels of task performance.

Stress
Stress impacts the personal, professional, and even the physical well-being. The employees at Stanza face high levels of stress during busy seasons of a semester. Hoang tries to reduce strain by helping his employees engage in problem-focused coping strategies and social support. Hoang also allows employees to have a more laid-back work environment during slower periods within a semester. Work at Stanza can create high risk of role overload during the rushes of the semester. Employees may have difficulty completing all of their different tasks at the beginning and end of semesters when the workload increases up to 10 times. From the interviews conducted, the employees claimed that they persevered by using problem-focused coping methods to work harder and seek assistance from Hoang. A common theme among employees is to focus on getting adequate rest to compensate for the extra workload. Stanza employees also face non-work stressors which they need to cope with. Stress can negatively affect home lives as well as work performance. One employee expressed that the best way to keep problems from affecting his job performance was to use emotion-focused coping by ignoring non-work problems. Employees at Stanza seem to have a common source of stress from school and the financial uncertainty of varying work hours. Hoang addresses these

9 stressors by helping employees with scheduling to try to accommodate academic and financial needs. The purpose of their work is to make money and pay for college expenses, so Hoang understands the importance of addressing these needs. As the manager of this facility, Hoangs work responsibility is high. He understands that his employees look up to him for instrumental support if they begin to experience burnout. Generally, the shipping employee(s) faces the highest levels of stress. During busier seasons, shipments sometimes need to be made and recorded all throughout the night to meet deadlines. Hoang provides support by moving additional employees to help with shipping as well as personally staying overnight. Some of the workload magnitude is attributable to the inefficient computer system that Stanza uses to process shipments. Hoang is working on developing a more efficient shipping process to address this issue. Hoang is adamant about keeping his employees happy and trying to provide a strain free environment. He does this by helping employees engage in problem-focused coping strategies for their work and non-work problems and minimizing the hindrance stressors present at Stanza. Hoang audits employees stress to try to not overload them.

Organization Structure
Stanza has previously restructured from a geographic structure to a functional structure. This shift increased the amount of work specialization within Stanza which has improved the efficiency of the organization. This change in organizational design is ideal for Stanza because of its low cost company strategy and technological limitations. As Stanza plans for future expansion, additional changes will need to occur within the Richardson location to make it more organic.

10 Hoang was promoted to general manager of the Richardson and Arlington stores in order to minimize the cost of managing business operations. Stanza consolidated common functional areas such as bookkeeping, shipping, and inventory management under Hoangs supervision in Richardson. Most of the Richardson employees specialize in a functional area and the Arlington employees now only focus on customer service and stocking shelves. This consolidation eliminated the need to pay a second manager to run the Arlington location. This was also a needed shift due to technological limitations. Stanza does not have integrated computer systems between the two stores; therefore, it was very difficult to track the inventory purchases, sales, and online order fulfillments executed at both stores. Now that the common functions are being performed within one location, it is much more organized. Regarding future expansion, Stanza will likely open additional stores, some of which may be in a remote location. In this event, Anuj and Hoang plan to move Hoang and all of the centralized functions to the new and/or remote location. They plan on having Hoang manage the Richardson location remotely in the same way he manages Arlington. The Arlington location is run primarily by the two full-time employees that work there while Hoang supervises remotely. These employees have an expanded view of what their roles are and can make daily decisions independently when facing challenges. The low formalization and decentralization of decisionmaking at Stanza enables the Arlington employees to operate effectively while minimizing time required from Hoang. The restructuring that has occurred at Stanza has enabled the organization to operate much more efficiently. The functional structure coincides better with the design of the organization considering the companys low cost strategy and technological limitations. The shift changed the Arlington location to operate more organically and independently through

11 decentralization and low formalization. In the future Stanza plans to expand and restructure the Richardson location to operate more like the Arlington location.

Recommendations
Stanza Textbooks is planning on future expansion to more locations. To prepare for the future changes, Stanza will need employees within the Richardson location to be available to operate with only remote supervision. It would be preferable to develop the current employees for the restructuring rather than hiring new, more experienced employees. This will minimize the negative impacts of restructuring such as reduced organizational commitment and job performance among the survivors. This will also reduce the cost of labor because previously trained labor requires higher wage rates. Stanza can effectively prepare employees for the future restructuring through motivational techniques, transformational leadership, and process improvement.

Motivational techniques
Stanza could improve their work team performance by providing innovative motivational leadership techniques. Hoang could incorporate psychological empowerment and apply pathgoal leadership behaviors in order to motivate his employees. This will result in maximum performance during their job. Implementing these motivational techniques will enable both the employees and the organization as a whole to surpass their current profit margins and overcome any negative situational factors that disrupt task performances. Path-goal theory adopts the perspective of a leader. It is designed to present the leader with a set of motivational techniques that will invigorate employees to achieve more with fewer difficulties. Leadership also motivates when it makes the path to the goal clear and easy to

12 travel through coaching and direction, removing obstacles and roadblocks to attaining the goal, and making the work itself more personally satisfying (Northouse, 2013, p.138). Hoang could efficiently minimize employees role confusion and maximize motivation by implementing directive leadership techniques for the duration of the restructuring and expansions. These leadership techniques emphasize clarifying tasks while they develop new employee roles, address needs among the unique college communities, or hire trainees. After this forming stage is over, Stanzas management could then apply achievement-oriented leadership behaviors by presenting employees with goal attainment opportunities that bolster their work engagement. Goals that would be appropriately challenging for experienced workers would be to present strict deadlines for shipments, teach new employees, or reward extra-mile behaviors. These behaviors will form skilled employees and can generate higher amounts of revenue through efficient labor. This leadership method is meant to establish heightened work standards for everyone involved through continuous improvement. Hoang could apply psychological empowerment with his employees to build employees self-confidence and enable them to operate independently. This would prepare the employees for the restructuring when Hoang will need to supervise remotely. Each employee remaining in the Richardson location would need to independently perform all routine tasks such as providing customer service, stocking inventory, and resolving any hassles that the bookstore may encounter. Giving Hoang this managerial assistance would free his time from daily tasks. Hoang would then be able to efficiently manage multiple locations as Stanza expands in the future. Stanzas leadership could motivate employees by implementing techniques that will develop their internal locus of control. Hoang could demonstrate a participative leadership style

13 when his employees have an unsatisfied desire for control. Stanzas employees are more likely to feel a desire for control when they are faced with unstructured and ambiguous roles. Allowing employees to have a modifiable work environment is a simple way to instill a sense of autonomy within an organization. For example, workers in the shipping department could help research strategies to improve shipping processes. Employees could also gain self-determination by being involved in reorganizing an office layout. Employees with internal points of control will become more motivated in their work tasks and maintain higher levels of job performance. After the experienced employees internal loci of control become well-developed, Hoang should implement achievement-oriented leadership behaviors which will maximize profitable job performances. The preceding leadership techniques will allow Hoang to maximize the profitability of his employees labor, while simultaneously minimizing any strains that would hinder task performance. These techniques identify the characteristics of employees and tasks in order to apply the most efficient response for a variety of workplace situations. Stanzas leaders will effectively motivate employees when they establish outcomes with positive valance and eliminate any obstacle that obstructs goal attainment.

Transformational Leadership
Hoangs leadership could be more effective if he demonstrated transformational leadership behavior. His current leadership style results in employee compliance which does not alter the attitude of the employee. If Hoang demonstrates transformational leadership successfully, employees will be more likely to internalize modeled attitudes and participate more enthusiastically in the companys growth. Hoang should focus on developing inspirational motivation and intellectual stimulation. These transformational leadership techniques will

14 positive impact the companys success and reduce the irreplaceability risk caused by Hoangs crucial role in the organization structure. Based on Hoangs position in the organization structure and transactional leadership style no one could replace him without a difficult transition period. Currently, Stanzas Richardson location hires young, inexperienced employees primarily for the sake of minimizing payroll. This is acceptable since Hoang is present and able to supervise them directly. Once Hoang moves to a new location, he will need employees at the Richardson location to work well with little supervision. Hoang should mentor his employees by creating enthusiasm concerning the future growth and future of Stanza. Hoang began as a cashier at Stanza as a young college student. One of the current employees may be able to become an important factor in the companys future. Mentoring employees and providing opportunities for them to contribute to the companys future would provide inspirational motivation to some employees. This would help emotionally prepare employees for the restructuring and make the transitions a more positive experience. Hoang has demonstrated a high level of personal expertise in his industry. As Hoang trains his employees for future responsibilities, he is quite capable of teaching needed skill sets and problem-solving approaches. This intellectual stimulation is only effective in the context of an intentional mentorship. Employees respond to the expectations placed upon them. Employees at the Richardson location are not expected to operate independently so they do not attempt to do so. By mentoring and developing employees personally, the intellectual stimulation he provides will equip them to become capable of handling more work situations on their own. This could also lead to employees being prepared to step into Hoangs position. If

15 something were to ever happen to Hoang, a mentee would help make the transition much smoother than a brand new employee. The employees response and involvement in Stanzas expansion will significantly impact the success of the company. Employees will develop a personal connection to the shared vision of Stanza through inspirational motivation. Employees will also be more capable of handling various work situations through intellectual stimulation from Hoang. Instituting transformational leadership behavior will positively affect job performance and organizational commitment. It will also improve the long-term stability of Stanza by training employees to be more committed and capable of handling greater responsibility. This creates a buffer to any risk of Hoang leaving the organization.

Process Improvement
Perhaps the most crucial change Stanza can make would be to streamline some of their more tedious processes. It would be helpful to analyze some of the most routine tasks to explore possible time-saving alternatives. Two of the specific processes which would benefit from improved efficiency are shipping and book pricing, but similar strategies should be implemented throughout the company. The benefits of process improvements would include decreased cost of labor, higher levels of accuracy, and lowered stress levels. In the shipping department, employees currently check and track orders across multiple systems as they are processed in order to maintain high standards of accuracy. While computer system integration would be the ideal solution for this process it is often an expensive and unrealizable goal for small businesses. A more pragmatic solution is to simply reduce conversion time between systems. One substitute to system integration is an export-import process. For example, a data export from the websites sales orders to Microsoft Excel could be

16 modified to match the import format required for the outbound-shipping system. This would allow employees to process books in bulk rather than individually. This is one of many affordable options which would result in substantial time savings for the company. Based on discussions with Hoang, the book-pricing process can be quite time-consuming. One of the tedious aspects is comparing prices at multiple competitors. This step is important to Stanzas goal of maintaining fair, competitive prices. This goal can still be achieved with significantly more automation. Many other textbook retailers have software that price books based off of the cost. A similar approach could be implemented at Stanza. Then, Hoang could perform competitor comparisons and only take action when he disagrees with the automatically generated price. The largest financial benefit to process improvements would be reducing the cost of labor, but it would also have indirect benefits. By reducing some of the time-consuming hindrances to successful job performance, employees would be less stressed and perform their jobs better. Employees would be able to spend more time performing quality control and have greater success in their work. Process improvement is important for any company and has many benefits. Some of the primary benefits would be reduced labor costs, higher quality control, and lowered stress levels. Since Stanza relies so heavily on online sales, it would be very beneficial to maximize the efficiency and accuracy of the shipping function.

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Conclusion
Stanza has created a positive environment which suits the needs of the organization and promotes organizational commitment and job performance. This environment is heavily influenced by Hoang due to his position in the company and leadership styles. Specific elements of the constructive atmosphere at Stanza include trust, support, and motivational and techniques. The organization structure of the company has also played a key role in its success. As the company expands and faces further restructuring, it will be beneficial to prepare employees. In pursuit of current and long-term profitability, Stanza should implement motivational techniques, transformational leadership, and process improvement. These approaches will also improve organizational commitment and job performance of employees which will directly increase the companys success.

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Works Cited
Funt, P. (2012) Column: How to break the college textbook racket. USA Today. Retrieved from http://usatoday30.usatoday.com/news/opinion/forum/story/2012-02-07/college-textbookprices-tuition/53001302/1 Northouse, P. G. (2012). Leadership: Theory and Practice. Thousand Oaks, CA: Sage Publication, Inc.