The McGregor Ltd. Department Store as founded in 1871 and since then it has acquired the image of being old fashioned and traditional. The President of the Store wants to change the image of the Store and to achieve higher efficiency and profitability by creating more business sense in the policies of the Store. Mr. McGregor has devised a new discount scheme for employees confirming with the current practices in other stores. Mr. President wants to communicate the new scheme without creating any resentment in the senior staff and to simultaneously implement the same without delay. The options available to Mr. President are either to call for the meeting of the executives or to write a memo to them detailing the new scheme. Further he has to decide either to continue with the existing scheme or to implement the new discount scheme. Each option has been evaluated in terms of profitability and effect on employees’ morale. On the basis of this evaluation, it is recommended that the President calls for the meeting of the executives and implement the new scheme.
Situation Analysis The McGregor is a retail store in downtown Boston. The President of the store is of the opinion that the store is not able to achieve high profitability and rapid turnover. The Store is also not yet ready to keep pace with emerging forms of retailing. However, he is of the firm belief that large discounts to senior grade staff, is the main cause for store’s lower profitability and discontentment among the lower staff; and, it has further led the customers and the other members of the staff to believe that the store is old and a traditional one, and is meant for old clients only. In order to attract new customers, to change the image, and increase the profitability of the store, the President wants to propose a new scheme of employees’ discount (as shown in Exhibit 1). Objectives proposed to be achieved: • • • • • Greater...