Theories and Application in the Organization for ERG Theory

Question: Discuss about theTheories and Application in the Organization for ERG Theory. Answer: ERG theory is a psychological theory proposed by Claton Alderfer. It is based on the theory of hierarchy of needs by Maslow. This theory basically refers to the core requirements namely Existence,Relatedness and Growth among the employees of an organization. According to this theory, people develops any type of desire at any point of time which they require to satisfy (Lazaroiu, 2015). Existence relates to the basic needs of the human being that are food, shelter and clothing. Relatedness relates the interpersonal needs which the employees need within their personal and professional settings. Growth refers to the peoples requirements to self-actualization that helps in personal development. As this theory particularly focus on the motivation factor, it can be directly applied in the organizational development. The companies use this theory to motivate and inspire the employees, therefore an efficient manager understands the places occupied by each of the employees in the hierarchy then motivate them accordingly. In Fisher Paykel Healthcare is an organisation that designs, manufactures and markets the healthcare products around the globe (Fphcare.com, 2018). The organisation must provide all the basic necessities to their employees and enhance relatedness with their workers through increasing involvement with their personal lives. It can create scope for internal esteem as well as recognition so that their employees become more creative and productive. The organizational behaviour of the company is purely based on the concept of care. Therefore, the employees of this company enjoy a sense of compassion and bond with each other that has decreased the work place rivalry. This is how they can strengthen their specific objectives without any problem. Two factor theory is established by Herzberg. It is a dual factor theory that is also known as the motivation hygiene theory. Here the theorist refers to two types of factors of satisfaction and dissatisfaction. This theory largely demonstrates that there are some factors present in an organization that cause satisfaction of the workers and some factors that leave the employees dissatisfied with their job (Alshmemri, Shahwan-Akl Maude, 2017). This psychological theory talks about the external factors which estimate the employees to enhance relatedness with the organisations as well as serve better. This theory is applied in various international organisations. In this case the companies that use this theory to motivate their employees to enhance productivity identifies all the external factors. After which the employers then categorise them according to the preference of these factors among their employees. According to the theorist some factors whose presence satisfy the employees, may or may not dissatisfy employees when absent. There can be different factors to dissatisfy the workers. Fonterra is a company that has earned international reputation for its dairy products. The hygiene factors that can motivate the employees are its policy, supervision and administration. Through developing good interpersonal relations and rewards, the company can enhance its growth possibilities and level of responsibility of the employees. The companys organisational culture where the employees work under cross-cultural situation, may affect the concept of the theory. In 2011, Theo Spierings became the CEO and managing director of Fonterra. His leadership style can be described as democratic. In this theory, the leaders allow the employees for active participation in sharing their ideas and opinions in the organizational decisions (Renko et al., 2015). Despite this fact that the employees take part in the organizational operation, the leader always remains there to guide and arrange the free flow of ideas but he is never autocratic. These leaders tend to maintain a democratic ambience in the institution where each of the employees get equal opportunity to introduce their ideas but the leader himself always decides which group or individual will get opportunity to contribute to the organizational decisions (Antonakis Day, 2017). The current CEO of Fonterra, has proved himself to be a democratic leader who asks for active participation of the expert employees in organizational decision making process whether it be manufacturing as well as supply chain management. The company has more than 20,000 employees. These employees are hugely skilled and responsible in their tasks which has led the company to compete in the competitive global environment. Despite the financial crisis all over the world, the company has successfully able to maintain its workforce because they are kept motivated and feel relatedness with their manager. The vision of the leader of this particular company has created scope for successful diversification in the dairy market. Democratic style that the leader has used to govern the organization has proved to be effective for Fonterra. The leader of Fonterra, Theo Spierings is a charismatic leader because he tries to make the status quo better (Fonterra.com, 2018). He has an engaging personality, unwavering commitments to his employees for positive change in the organization. This type of leaders is humble yet confident in their decisions. They are excellent connectors that motivate the employees for positive change. For motivating the inferiors, they act compassionately with them. Charismatic leaders are often termed as transformational leaders as they share similar characteristics (Nguyen et al., 2017). The charismatic leaders have excellent eloquence which helps them to encourage theory employees to overcome the tough time and remain pacified till the things are good. This kind of leaders are comfortable in communicating with both the individuals as well as groups equality. As this kind of leaders are matured in their thoughts hence remain confident with their decisions and actions. They control the situation and remain controlled in recovery condition which overwhelm their employees. The charismatic leaders listen to their followers compassionately and value them. Their humility attracts the followers and inspire them greatly. The CEO of Fonterra Theo Spierings has 30 years of experience in global dairy industry hence he is confident in all his decisions. He is compassionate for the employees hence changed many policy of the company to make them beneficial for the employees. Theo is a great motivator and communicator who joined in 2011 yet has become successful to speed the companys penetration in Asia, Africa, Latin America, Europe and the Middle East. Delegation of the authority is an important process where the powers of the authority are shared and divided amongst the subordinates. Delegation of authority occurs in a situation where the excess workload of the managers is divided between the employees. The manager is able to divide his work between the employees with the help of effective delegation process. The managers can then use their time in other critical issues of the organization as they have reduced workload. The relationship between the superiors and the subordinates have a major effect on the delegation of the authorities. The example of a situation where delegation can be applied when the demands of the customers are high and the managers need to give their attention on major issues like the change of policies in the company (Haselhuhn, Wong Ormiston, 2017). The change model has been developed by Kurt Lewin which mainly involves three steps, unfreezing, changing, refreezing. This process of change is related to the creation of perception that whether a change is needed in an organizational process. Unfreezing is related to the process of creating an awareness of the level of acceptability among the employees regarding the change. Changing is related to the implementation of the change process in the organization. Refreezing is related to the reinforcing of the change process and starting the new organizational process after the change. For example, in case of the purchase of new machines, first the employees need to be made aware of the benefits, then the machines are implemented in the production and then the machines are utilised by the employees (Cummings, Bridgman Brown, 2016). White water metaphor is related to changes in the organization that come in the form of occasional storms. According to calm waters rapids metaphor the change process can be seen as the disruption in the normal work flow in the organization. Fonterra has developed sustainable strategies so that they can create long-term values for the future generations of the country. The company has to face many challenges related to long-term production of food. The economic issues occurring in New Zealand had an adverse effect on the operations and profitability of Fonterra. The fall in the dairy prices had led to a huge loss for the company. The various changes in the technologies, people and the products have hugely affected the business of Fonterra (Jermier Forbes, 2016). The major external forces that can lead to changes in an organization are, Crisis When crisis situations related to various issues occur in an organization change becomes important. Pressure External pressures related to the demands of the customers can lead to change. New technologies in the business environment can lead to changes and innovation in the organization. The changes that have been brought by Jeff Bezos in the business of Amazon by making the theme of the company as an everything store has been profitable for its operations (Al-Haddad Kotnour, 2015). The first strategy that can be used by the change agent of Fisher Paykel is related to the use of emotions rather than the use of logic in the change process. The second strategy is related to the usage of informal communication process rather than the usage of formal communication to communicate the change related information (Coghlan, Rashford de Figueiredo, 2015). Planning process is very much important for the companies that decide to bring development in their business. All the corporate sectors need to plan to support their company strategies. There are six essential steps in planning process. First, the organisations select the employees and stakeholders to execute the plan and communicate their responsibilities. Secondly, understanding of the goals and relate them to the planning process is essential. Thirdly, identification of the areas where companies need to change policies and work of improvement. Fourthly, proper determination of the process to achieve the organizational objectives and develop projects Fifthly, proper communication of the plan to the stakeholders Finally monitoring the progress in time gap. The Simunovich Olive Estate, decided a strategic planning for their overall growth. It was a long term thinking. The company has proper mission, vision and values but its planning had no operational issue. Their plans are different and not record day to day running of operation (Bretones, Delgado Len, 2015). The Simunovich Olive Estate can use their SWOT analysis in creating a strong static planning to survive in the competition (Simuolive.co.nz, 2018). The brand has significant global presence which is resulted of their strategy to keep the price low and provide high quality. This industry has immense opportunity of market penetration because there has been an emerging market such as India and China where their products have been gaining popularity. The company can strategies to enhance the scope for innovation which will definitely help them to retain and grow their market presence. Despite the fact that there is volatile revenue in this sector, but through proper strategies, The Simunovich Olive Estate can successfully out perform their international competitors. Control cycle is necessary for The Simunovich Olive Estate. It involves application of professional application for the real world business problems. It needs to specify the problems, think out possible solutions and apply them. After which the company can monitor the process. Based on that consequences, the organization will be able to repeat the process. This processes are self-reinforcing system dynamic that the company can use for addressing business problems. concurrent control is a technique that the managers use to monitor the behaviours and processes of the organization. Thus they can ensure that the process conforms with the regulations along with standards. This monitoring procedures take place in real-time during the activity or process and makes adjustments for preventing errors. This type of control is a step to minimise the unnecessary wastes along with attendant cost. Feedforward control is also called preventive control where the mangers identify as well as prevent deviations in the standards before they take place. This focuses on the financial resources, human and material in the organization. This reflects in the selection and hiring process of the company. References: Al-Haddad, S., Kotnour, T. (2015). Integrating the organizational change literature: a model for successful change.Journal of Organizational Change Management,28(2), 234-262. Alshmemri, M., Shahwan-Akl, L., Maude, P. (2017). Herzbergs two-factor theory.Life Science Journal,14(5). Antonakis, J., Day, D. V. (Eds.). (2017).The nature of leadership. Sage publications. Bretones, G., Delgado, M. D., Len, J. (2015). Myc and cell cycle control.Biochimica et Biophysica Acta (BBA)-Gene Regulatory Mechanisms,1849(5), 506-516. Coghlan, D., Rashford, N. S., de Figueiredo, J. N. 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