MFS system free essay sample

Basically, culture of MFS is focused on teamwork and community so that MFS manages their employees very fair and its compensation system also reflects this characteristic. For sustaining this team –based culture of MFS, which don’t prefer star(anti star culture), MFS assesses their employees to the ways that not only fund-performance(performance factor) but also contribution to the investment, and contribution to MFS overall(community factor). The portion of performance factor is 60% but community factors are 40%. It is not easy to ignore such a huge portion. In this system, as a result, it cannot be possible to make a good assessments and high rewords without the effort for increasing community factor. So employees have to consider both performance factor and community factors. They should interact with their coworkers frequently, share information they have, and participate in several groups enthusiastically. When MFS recruit new employees, it considers applicants’ feature related with community factors because they don’t want to lose its employee just â€Å"high pay level† of competitor companies offering to the employee. MFS want to leave its employee not for pay level but other things such as team work cultures, individual development circumstance in MFS, and fitness between firm’s value and its employees. They assume that the employee who want to get high pay level could have possibility to turnover MFS when other company offer high pay level compared with MFS. Considering this kind of system, factor that can motivate employees is behavior which can contribute to the community. As an example, organization citizen’s action is that kind of behavior. The action can improve coworkers’ efficiency and job atmosphere so it increase whole performance of organization indirectly. In addition, share their skills( ), related with organization citizen’s action but little bit different, are another way to contribute to company. It is more related with performance factor but in the process of sharing skills, employees took part in that process can communicate with each other and can make good relationship between skill giver and taker. 2. What are the potential problems and major challenges created by the MFS performance evaluation system? What are your suggestions for managing these problems and challenges? It is very nature that assessment system based on community factors is subjective. Subjective assessment is difficult to deal with ‘contribution to performance’ it is also problem when the situation of 360 diverse assessment because to get higher grade, employees too much focus on relationship factor so their efforts are diluted. Of course community factor is important but 40% of assessment portions are too much. In terms of employees’ point of view MFS assessment system can decrease motivation of performance factor. The evidence is there are no employees to do their work just 5 minutes after office time. That is because MFS don’t give extra payment to employees performance related effort so they don’t want to work hard enough to reach their maximum ability. In addition, low penalty of low performance is another problem MFS compensation system contained. Of course, in long term point of view and considering MFS culture, MFS want to find out low estimated stocks or asset to invest. In that point, short term performance is not that important but it could cause reducing ability because employees don’t afraid of being fired as reason of fool performance in the short term period. At last, basically all human want to receive appropriate reword when they achieve something valuable. But MFS don’t offer its employee even if the employees make remarkable performance so the employees are hard to have attachment to their work. In terms of supervisors’ point of view No objective indicates for assessment mean that supervisors consider more various possibilities when they assess their subordinate. And time and effort are also more required. As a result, supervisors are in trouble because of the reduced time for their own tasks so they couldn’t put their best efforts on the task. (Supervisors feel tired after assessment process) it is kind of waste to the MFS. Suggestion To exchange the balance of assessment system is one of the way to enhance efficiency of MFS. Setting the portion of performance factor 60% to 70% and reduce the portion of community factor 40% to 30%. 30% is not ignorable score to the employees so they would still do community friendly behavior for 30% but they more focus on performance factor to achieve high assessment score. In addition, they diversify their subjective assessment tool ‘Free-writing’ to ‘check-list ‘. When making check-list, we can extract some important and valuable issues on the previous Free-writings from their employees, then including the issues on the check-list. It can make supervisor less tired because supervisor don’t need to consider very specific information about employees. 3. Do you think that MFS will be successful in using their system for their hedge fund managers? If not, why not? If so, upon what will their success depend? The system based on performance is needed. High risk-high return is feature of hedge fund so MFS should control the risk. For that, loyalty of employee is most important factor and thy way to increase employee’s loyalty is giving them certain satisfactory compensation because if employee makes huge profit from their task but firm doesn’t give him compensation, that make employee miserable. As time goes by, the employee feels uncomfortable through the gap between their performance and compensation level. At this situation, the way for motivating employee should be exist. If not, MFS system accelerates turnover rate of hedge department employee. MFS just have team based culture. But it is not fit in the hedge fund business. So it must change their motivation tool for the new business. However, to give additional bonus is not allowed to its culture. Regarding it, I want to recommend â€Å"Hall of fame†( ) for their employees. When certain employee achieves remarkable performance in hedge fund, MFS register his name on the company bulletin board. That makes him proud himself. But the period of on the bulletin board should be short for the rest of other employees. The reason is that too long period of it makes other employees’ feeling inferior. The purpose is just not to make stars but to motivate someone who is very good. But this strategy is mainly focus on the person who has very strong need in the growth desire. (According to the theory of ERG) However, employees’ desire is belong to the existence desire, it is very hard to deal with the employees.