Dave Roberts Is the Program Director at a Small,family-Owned Gym

question 65

Essay

Dave Roberts is the program director at a small,family-owned gym in an affluent neighborhood.He works closely with the owner,his wife,and one other manager managing the day-to-day operations of the gym.He has an MBA from a large Midwestern university.The program director's main job is to oversee the front staff of the gym,which ranges from five to seven people,all part-timers.Dave and the owner get along,but they have different views on performance management.
n an effort to increase revenue and motivate the part-time workers,the owner tends to propose monthly sales goals at random to the staff.There is no clear standard for setting these goals,which results in them sometimes being too low and other times impossible.He also sets the same goal for each employee regardless of their experience or tenure at the company.The owner also does not believe in giving employees a bonus beyond their regular pay.He thinks that the better than average salary coupled with free use of the gym is enough to generate employee engagement and motivation.The company has a hard time retaining staff.In fact,the gym had a 40 percent turnover this past year,which is why the owner hired Dave.
Dave thinks employees should have one set of goals that are established at the beginning of the year.Dave also does not like the ad-hoc approach toward giving performance feedback.If feedback was given at all on the progress made toward attaining the owner's goals,it was usually negative and seldom included solutions or suggestions for correcting the issues that were hindering the staff.The company has not provided any performance management training to managers or employees.In terms of recognition,the owner reacts harshly toward the managers and employees when his random goals are not being met.
Dave is wondering what he should do about the situation.Should he approach the owner and propose changes in performance management,or should he just make the changes himself?
Using the 3-Step Problem-Solving Approach and the Organizing Framework,identify the problem in this case and present a recommendation.

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Definitions:

Process Costing

Process costing is a method of costing used by companies that produce similar or homogenous products, where costs are accumulated over a period and then allocated to units of product.

Weighted-Average Method

An inventory costing method that assigns an average cost to each unit of inventory, calculated by dividing the total cost of goods available for sale by the total units available.

Conversion Cost

Sum of direct labor and manufacturing overhead costs, representing the costs necessary to convert raw materials into finished goods.

Process Costing

An accounting methodology used to assign costs to units of production in industries where the production process is continuous.