Reference no: EM132833799

Read the scenario stated below and answer the following questions in detail:

What should Griff do? What is your suggestion? Also, remember the three criteria for good measurement are a) Reliability b) Validity, and c) Sensitivity.

Money Matters?

Griff Mitchell is the vice president of customer relationship management (CRM) for one of the world's largest suppliers of industrial heavy equipment. In this role, he oversees all sales and service operations. This year, for the first time, the company has decided to perform a CRM employee evaluation process that will allow an overall ranking of all CRM employees. Griff knows this will be a difficult task for many reasons, not the least of which is that he oversees over a thousand employees worldwide.

The ranking will be used to single out the best performers. These employees will be recognized at the company's annual CRM conference. The rankings will also be used to identify the lowest 20 percent of performers. These employees will be put on a  robationary list with specific targeted improvement goals that will have to be met within 12 months or they will be fired. Griff is becoming really stressed out trying to define the performance ranking process.

Griff's key question is, "What is performance?" Although these employees are now often referred to as CRM employees, they have traditionally performed the sales function. Griff calls a meeting of senior CRM managers to discuss how ranking decisions should be made.

One manager simply argues that sales volume should be the sole criteria. She believes that "sales figures provide an objective performance measure that will make the task easy and difficult to refute." Another counters that for the past 22 years, he has simply used his opinion of each employee's performance to place each of them into one of three groups: top performers, good performers, and underperformers. "I think about who is easy to work with and doesn't cause much trouble. It has worked for 22 years, why won't it work now?" Another responds curtly, "It's margin! It's margin! I don't care about sales volume; I want my guys selling things that improve my division's profit!" One of the newer managers sits silently through most of the meeting and finally summons up the courage to speak. "Aren't we CRM? That means performance should not be tied to sales, profits, or convenience, it should be based on how well a salesperson builds and maintains relationships with customers.

So, we should see how satisfied the customers assigned to the employee are and use this in the evaluation process!" After this, the meeting disintegrates into a shouting match with each manager believing the others' ideas are flawed. Griff feels like he is back to square one.

"How do I make sure I have a valid performance measure so that all of our people are treated fairly?" He decides to seek out an opinion from a long-time friend in the research business, Robin Donald. Robin suggests that a research project may be needed to define a reliable and valid measure. She also brings up the fact that because employees from all over the world will be considered, the measure will have to maintain its reliability and validity anywhere it is used! Griff agrees to the project. He also feels good about letting someone outside the company develop the measure because he certainly realizes the tremendous challenges that are present. Griff's situation in this vignette illustrates how difficult it can be to define, let alone measure, important business phenomena. While some items can be measured quite easily, others present tremendous challenges to the business researcher. This is the first of two chapters that deal with measurement in business research.