weston_major project paper

Running head: McGinn’s Sustainability in Action 1

McGinn’s Sustainability in Action Report

John Weston (0626526)

Leading Sustainable Organizations (MSMGT770FA13)

Dr. Lucy A. Arendt

12/20/13

Table of Contents

Executive Summary.........................................................................................................................1

Recommendations............................................................................................................................1

Sustainability Audit.........................................................................................................................2

Unit 1: Strategies for sustainable effectiveness...........................................................................2

Unit 2: Developing a strategy......................................................................................................4

Unit 3: Board Governance...........................................................................................................5

Unit 4: Structures for sustainable effectiveness...........................................................................6

Unit 5: Sustainable work systems................................................................................................7

Unit 6: Managing performance....................................................................................................8

Unit 7: Reward systems.............................................................................................................10

Unit 8: Managing talent.............................................................................................................13

Unit 9: Leading, managing, and following................................................................................16

Unit 10: Transforming to sustainable management...................................................................18

References......................................................................................................................................20

Appendices....................................................................................................................................23

General.......................................................................................................................................23

Unit 1.........................................................................................................................................24

Unit 2.........................................................................................................................................25

Unit 3.........................................................................................................................................26

Unit 4.........................................................................................................................................26

Unit 5.........................................................................................................................................28

Unit 6.........................................................................................................................................29

Unit 7 ........................................................................................................................................30

McGinn’s Sustainability in Action 1

Executive Summary

The question of sustainable management for organizations should not just apply towards

big business or corporations on the fast track for franchise. Instead, it should be an approach that

any organization can and should base their business strategy and principles upon. McGinn’s is a

sports bar and restaurant located in the Bluemound Heights District of Milwaukee. Since its

inception, the goal of the restaurant has been to provide good food and drinks at an affordable

cost in a fun and friendly atmosphere. While not necessary incorporating sustainable

management into its core philosophies, it embodies a number of sustainability principles

nonetheless. This sustainability audit reviewed McGinn’s business strategy and structure, as

well as, its particular approach towards management, work system, and rewards. The results of

the audit show what while some aspects of McGinn’s business model do indeed resemble that of

a sustainable management organization (SMO), there are other areas in which it could improve.

Recommendations

There are three key recommendations that McGinn’s can utilize to lay out a path toward

achieving sustainable effectiveness. These recommendations are:

(1) Develop organizational goals and behaviors aligned with the principles of

sustainability (i.e., people, planet, profit). Through management and organizational

leadership, work toward effectively articulating and describing how these new goals will

be achieved to the work force. This is imperative as it will set McGinn’s on a path

toward developing an identity that supports sustainable effectiveness. As such, this

approach towards innovation and sustainability would begin to rework the culture and

identity at McGinn’s. Often times, this is overlooked when trying to reinvigorate and

reinvent a company/organization, as conceded by Daniel Aronson the director of


Sustainability Deloitte Consulting (2013, p.1). More importantly, while the company

itself might not be thinking about sustainability, customers and their competitors might.

This will give provide McGinn’s with competitive edge and gain favor amongst its

multiple stakeholders.

(2) Develop, agree upon, and implement an official competitive business strategy in order

to guide an organizational goal-setting process on a path toward greater transparency,

agility, and achieving obtainable objectives. This will help begin to guide behaviors

necessary for sustainable effectiveness. As a small business centered on the food and

service industries, the role of sustainable development must be tailored toward its specific

organization size and type of business (IISD, 1992 p. 1). As such, McGinn’s unique role

places it in a position to adopt business strategies that can do its part in protecting the

world’s natural and human resources.

(3) Develop and begin implementing an approach to medium- and long-term futuring to

more effectively seize upon temporary competitive/momentary advantages. Presently,

McGinn’s engages in short- to medium-term futuring only. Short-term futuring allows

them to make minor changes in their strategic intent to reach their immediate and short

range goals. However, the implementation of medium- and long-term futuring helps

ensure the survival of the business and avoid unintentional blindness (i.e., the potential of

another economic downturn).

Sustainability Audit

Unit 1: Strategies for sustainable effectiveness

McGinn’s fairly strongly held identity is that employees consider it a “pleasant” and

“fun” place to work. In fact, it would seem these traits are central to McGinn’s identity as


something that has characterized the organization over time. These traits, however, are largely

indicative of a high involvement organization (HIO) where “effectiveness derives from the

productivity of engaged and committed people” (Lawler & Worley, 2011, p. 67). Indeed,

McGinn’s appears to be particularly effective at creating positive social value through its ability

to maintain a large customer base; commitment to community involvement and support efforts;

and by treating its workforce and customers as key stakeholders. Part of McGinn’s competitive

strategy also helps to ensure its survival in creating economic value by keeping costs low and

recognizing the importance of remaining profitable. McGinn’s approach to risk also appears to

be practical, cautious, and financially conservative. This helps to put McGinn’s on a path toward

sustainable effectiveness.

However, based on the responses given, McGinn’s identity and strategic intent do not

appear to fully embody Lawler and Worley’s description of a sustainable management

organization. “SMOs are long-term focused and pay attention to three areas: people, planet, and

profit – the triple bottom line” (Arendt, 2013). Currently, the organization’s competitive strategy

focuses on keeping costs low, experimenting with new promotions, and providing quality food in

an enjoyable work and dining environment. At this time, there is no indication McGinn’s is

incorporating environmental performance into its business strategy. When it comes to creating

value, McGinn’s would need to pay equal attention to creating both social as well as ecological

value. In fact, “creating ecological value suggests that business strategies built around the

productive use of natural resources can solve environmental problems at a profit” (Lawler &

Worley, 2011, p. 49). McGinn’s could learn from other small- to mid-sized restaurants as a

means of improving products and services, while also reinventing itself towards sustainability.

This includes models such as Sweden’s Max Burgers and its use of locally sourced ingredients


and healthier menu options, even going as far as encouraging the consumption of less red meat

by offering vegetarian and white meat options (i.e., chicken, fish) (Blume, 2011). However, as

stated earlier, McGinn’s strives to keep costs low and the introduction of sustainable foods might

include the assumption that such foods would increase costs and reduce profit margins. Yet, as

posit by Himmelfarb (2012) it is often more cost effective to source local, sustainable, albeit

conventional food.

Unit 2: Developing a strategy

McGinn’s appears focused on executing a strategy within a time span of weeks and

months. As the responses indicated, a significant portion of McGinn’s business depends on

maintaining its link to various sports seasons. This includes the organization’s participation in

the Brewer’s games bus shuttle program as well as its community involvement and advertising

efforts in local high school athletic programs. Short-term futuring also relates to McGinn’s

particular strategic intent including its differentiation, aggressiveness, and breadth strategies.

McGinn’s has increased the degree to which it advertises and attempts to attract new customers

through social media (i.e., Facebook) and by remaining open and exploring additional ways to

advertise. It has also taken steps to introduce new daily specials, promotional items, social

events, and other new menu items. These efforts represent an important part of McGinn’s short-

and perhaps even medium-term futuring process. Short-term futuring in general is important to

an organization’s strategy as it involves “changing the dimensions of strategic intent to improve

current value” (Arendt, 2013).

An SMO, however, focuses on short-, medium-, and long-term futuring. Long-term

futuring enables an organization to consider possible future strategic intents and the operating

assumptions necessary to drive them (Lawler & Worley, 2011). While McGinn’s short-term


futuring helps to guide minor adjustments to its current strategic intent, looking farther ahead

better enables organizations to better seize temporary/momentary advantages when they come.

It also allows an organization to better foresee and prepare for any number of surprises that

might come along (e.g., economic downturn, upcoming business-related trends). As Lawler and

Worley explain, “The medium-term futuring process forecasts the economic, social, and

ecological contexts that are likely to dominate the next planning horizon” (p. 84).

Long-term futuring, on the other hand, is also important as it involves “playing with the

future, attempting to identify changing assumption, developing a cadre of options, and making

low-risk investments in future capabilities…” (p. 84). As with the SMO approach to value

creation, futuring processes should focus on financial performance, social value, and the natural

environment (p. 74). These ideals are important as, according to the Strategic Sustainability

Consulting (2012), “restaurants are positioned at the center of a network of producers and

consumers in such a way that affords them the opportunity to have beneficial social as well as

environmental impacts” (p. 3).

Unit 3: Board Governance

The role of the board in an SMO is essentially to serve as a representative of the

organization’s shareholders or owners. The board is also responsible for “establishing the

organization’s identity and approving strategic intents that are aligned with that identity” (Lawler

& Worley, 2011, p. 101). Although McGinn’s is a small business and does not have a board to

serve in this capacity, nevertheless, the interview response indicates that an advisory board of

some kind might be useful to the organization in this regard. As such, feedback from an

external advisory board may serve as a way to explore important long-term economic, social, and

environmental considerations and assumptions by way of a scenario-planning process (Lawler &


Worley, 2011). Essentially, a service like this may help McGinn’s owners in the futuring

process in order to plan ahead and prepare for unforeseen scenarios. Conversely, external

futuring services through management consulting firms can help organizations define and better

reach their goals. A simple search of the World Future Society (2013) details a list of possible

options that businesses can take advantage of in navigating the futuring process.

Unit 4: Structures for sustainable effectiveness

McGinn’s is essentially a traditional functional organization with both a centralized and

decentralized structure. This is because on the one hand it focuses attention and resources on

technical specialties such as cooking, waitressing, and bartending; on the other, organizational

decision-making takes place by both top-management and non-management employees. It is

also a nonstandardized, informal organization since it focuses more on mutual adjustment in

coordinating people and activities and has no official written standard operation procedures

(SOPs) or organizational rules. Listening to multiple stakeholders also appears to be an

important part of McGinn’s culture as it frequently interacts and coordinates (i.e., menu items)

with customers, neighboring businesses, employees, and to a certain extent, other stakeholders as

well. Indeed, McGinn’s culture and business style allows employees easy and valuable access to

customers especially. However, based on the information collected, it seems McGinn’s regular

customers have greater influence over organizational decisions than other types of stakeholders.

This may include new or unfamiliar customers and non-customers including members of the

community.

Moreover, there is no indication McGinn’s actively considers the natural environment,

ecosystems, etc as one of its many stakeholders. Comparatively, the large restaurant chain

Chipotle considers its ecological footprint as an extremely important part of the company’s


business strategy and image (Gibson, 2010). This image includes the company’s motto “food

with integrity” that reflects the company’s mission to provide naturally raised meats coupled

with minimal food packaging waste. With this in mind, further increasing McGinn’s surface

area would help to develop more sophisticated collaboration processes, increased flexibility, and

position the organization better in addressing social, ecological, and economic concerns (Lawler

& Worley, 2011).

Unit 5: Sustainable work systems

Work at McGinn’s is primarily designed around narrowly defined job titles and

descriptions in which cooks prepare food, waitresses take orders and serve food, and bartenders

serve drinks while keeping the bar area clean and stocked. As such, most daily work activities

performed individually as managerial tasks tend to allow employees some influence in

operational decisions. However, at the same time, work remains largely driven by shared

company goals of providing customers with an enjoyable bar/dining experience and having fun

while doing so. Therefore, although McGinn’s does use job titles and descriptions, shared goals

emphasize more than each particular set job function. Work at McGinn’s is more about

“dynamic work assignments and relationships…” (Lawler & Worley, 2011, p. 163). This

reduces the potential for conflicts or cross-purposed work and helps create a work environment

more likely to consider environmental issues (Lawler & Worley, 2011).

Although it is difficult to imagine daily work at McGinn’s conducted by multiple

stakeholder teams due to the nature of the business, there may be the potential for McGinn’s to

accumulate important feedback from multiple stakeholders when it comes to new menu items

and/or planning and running special events. It is important for SMOs to involve as many

stakeholders as possible, to remain agile, and to remember that any work system is and will need


to change when economic performance, positive social outcomes, and/or ecological health goals

are not being met (Lawler & Worley, 2011). At times, this might also involve “small and

frequent improvements in the product or service” as well (Lawler & Worley, 2011, p. 169). As

such, McGinn’s approach to work systems leans more towards a sustainable work system

(human resource regeneration and growth) vice intensive (the consumption of human resources)

due to the high level of interaction and dialogue (Docherty, et al, 2002).

Unit 6: Managing performance

Of the eight universal management principles, McGinn’s currently meets the criteria of

setting measurable goals (#3), rating outcomes and performance (#4), and using 360-degree

appraisals (#8). McGinn’s does this by focusing on the central goal of meeting or exceeding

customer expectations and assessing and rating employees on their ability to do so. Management

also uses input from peers and subordinates in order to evaluate employee performance and assist

in their development. However, McGinn’s might need to work on better articulating and

communicating its business strategy in a way that is both transparent and practical (e.g., business

slogan, through social media) (principle #1).

Next, although McGinn’s does not have a human resources department to involve, it

should be clear that the performance management system is the responsibility of McGinn’s

senior management. That is, it should be evident to all McGinn’s employees that managing

employee performance is primarily the responsibility of senior managers (principle #2).

Performance management also involves appraising how well each manager appraises

subordinates (#5). This is important because managers also need to be held accountable for how

well they are carrying out this important management function. In addition, it demonstrates that


management takes performance appraisals seriously. As such, managers would need to begin

appraising and perhaps rewarding each other on how well they are doing.

Further, “it is critical that organizations train everyone on how their performance

management system works” (Lawler & Worley, 2011, p. 190). McGinn’s performance

management system should be something that every employee understands and is capable of

doing themselves. Managers in particular should be capable of effectively executing a

performance management system. As such, McGinn’s managers might look at ways of

improving their ability to do so (principle #6) through the implementation of e-learning software,

which while cost effective, also enables the restaurant to better train/teach managers (Ferasat,

2009). Lastly, an effective performance management system should include a performance

review process that links performance to salary increase and/or promotions (principle #7). It is

important that employees understand the connection between performance and rewards.

McGinn’s should also work toward meeting the criteria of the six SMO performance

management principles in order to “produce a performance management system that supports

sustainable effectiveness” (Lawler & Worley, 2011, p. 193). First, establishing a scorecard that

balances social and environmental goals offers an organization a means to measure specific goals

relevant to an individual’s work area. This would include social, environmental, and employee

impact goals, as well as diversity goals (Lawler & Worley, 2011). Second, the performance

management process should include an assessment of the skills and competencies necessary for

individuals (as well as teams) to achieve their goals. Essentially, this means helping to ensure

that employees have the skills they need to achieve their performance goals (Lawler & Worley,

2011). Third, it is important to conduct performance appraisals regularly and frequently, as

deemed appropriate. This helps to guide behavior and motivate individuals as well as evaluate


how performances are measuring up in terms of meeting goals. Fourth, although an SMO’s

talent management system should look to utilizing web-enabled technology as a means of

managing talent, this may not be necessary for a small, local business like McGinn’s. As such, it

might be more practical for McGinn’s to use more traditional, non-web enabled technologies in

its performance management system. Fifth, although McGinn’s particular work system often

does not make work in teams/groups possible, in those instances when groups do carry out work

(i.e., events) there might be a process in place to appraise and reward effective performance.

Lastly, while SMOs should conduct review discussions online when possible, McGinn’s might at

least look to conduct face-to-face appraisals by first putting them on paper and allowing each

employee to read them over prior to the actual appraisal. This would give employees the

opportunity to correct any factual mistakes they find, prepare themselves, and provide them

appraisal data prior to the face-to-face appraisal. This would allow for more accurate appraisals

overall (Lawler & Worley, 2011).

In sum, although McGinn’s does meet the criteria for three of the eight universal

performance management principles by actively engaging in certain performance management

activities, it is imperative that the organization work on establishing and implementing an official

performance management system that embodies both universal and SMO principles of

performance management.

Unit 7: Reward systems

When it comes to McGinn’s reward system, it does appear to be doing a good job.

McGinn’s currently meets two out of the five universal reward principles (#1 – creates rewarding

work assignments; #2 – forget merit increases, give bonuses). McGinn’s reward system creates

rewarding work assignments by promoting the incorporation of feedback from customers and


other workers (principle #1). As Lawler & Worley (2011) explained, “When individuals use

skills they value, feel responsible for producing a whole or meaningful part of a product or

service, and receive performance feedback, their work is motivating because they reward

themselves for their good performance” (p. 207). McGinn’s also provides cash bonuses rather

than merit increases to reward performance. This in turn creates a win-win relationship between

the restaurant and the individual in which both share in the success. The rewards or variable pay

system is adaptable, focusing on key measures of success tailored towards individual goals

(Zingheim & Schuster, 2000).

As is the case with McGinn’s work system, its ability to base pay on team performance is

limited to those few activities that make group/team assignments possible (i.e., special events)

(principle #3). As a non-publicly traded company, it would also not be possible for McGinn’s to

provide employees with stock options or stock-grant opportunities. A profit-sharing plan,

however, might be possible and would serve as a means to further reward individuals according

to the company’s level of performance (principle # 4) (Lawler & Worley, 2011). Finally,

McGinn’s does not currently use a reward system based on any sort of set time cycle. The

benefit in doing so, however, is when changes in company tactics or strategy require new skill

sets, performance goals, as well as rewards to support them (Lawler, & Worley, 2011). For

instance, if McGinn’s were to add a new type of cuisine to its menu that required cooks to

receive additional, specialized training, McGinn’s might look to implementing a quarterly or

semiannual performance reward cycle to evaluate and reward cooks on progress made.

When looking at the seven SMO reward principles, McGinn’s fairs very well in this

regard by meeting the criteria for all but the last principle of using identity and purpose as

rewards (#7). First, although each individual hired by McGinn’s starts off at a comparable


market pay rate for the position in which they are hired, employee pay at McGinn’s is primarily

based on their skills, competencies, and ability to perform, rather than on their particular position

(principle #1). As the interview response indicates, employee raises are fairly uncommon at

McGinn’s. As such, an employee has to “prove their worth” and show that they “deserve to be

paid more.” As a clear example of this, the interviewee explained that one new cook hired at

McGinn’s recently received “two small raises before he even got his first paycheck.” This is a

good way to attract and retain the “right” individuals to the company.

McGinn’s also pays individuals who hold critical positions and possess critical skills (i.e.,

cooks) slightly above the average market rate (principle #2) (national average =$11.62 per hr;

McGinn’s=$12.00) (Kenexa, 2013). The benefit in doing so is in helping to retain individuals in

positions that are costly to replace and/or are a disruption to the company (Lawler & Worley,

2011). If McGinn’s were to lose a valuable member of its kitchen team for instance, this would

clearly cause a major disruption to the business, since it would likely be more difficult to find a

replacement cook than it would be to find a new bartender or waitress – or perhaps to move a

member of management into the kitchen to assist in this capacity.

Rewards at McGinn’s tend to be individualized according to an employee’s personal

preference (principle #3). For example, rather than receiving a cash bonus for a job well done,

an employee can instead opt to come into work an hour or two later than scheduled.

Individualizing rewards is important for an SMO as it recognizes the differences in what types of

rewards employees’ value (Lawler & Worley, 2011). Rewards also do not appear based on any

type of hierarchical structure that exists within the company (principle #4). In fact, aside from

the authority held by top management, no meaningful hierarchical structure exists at McGinn’s,

according to the employee interviewed. Further, since McGinn’s rarely offers employees pay


raises based on time with the company, it also stands to reason that seniority does not factor into

McGinn’s particular reward system (principle #5).

Pay transparency is also important to SMOs as it translates into greater accountability,

more “informed judgments on the part of individuals and what makes for effective pay for

performance systems” (Lawler & Worley, 2011). McGinn’s does not have any policy in place

forbidding employees in discussing how much money they make (principle #6). At the same

time, it is not necessarily common-knowledge that is often shard within or outside of the

company either. Lastly, McGinn’s would not appear to meet the criteria of an organization that

uses its identity and purpose as a source of rewards (principle #7). This is because McGinn’s

does not currently appear committed to establishing an “employer brand as a sustainable

management organization” (Lawler & Worley, 2011, p. 223).

Unit 8: Managing talent

McGinn’s approach to talent management focuses mostly on long-term development,

individual career management, and while it does provide a certain amount of career diversity,

primarily does not adopt the “travel-light” approach. Of the nine SMO talent management

principles, McGinn’s currently meets the criteria of using a targeted talent management (#2);

create career diversity (#5); build a sustainable management brand (#6); and make career

management the individual’s responsibility.

As Lawler and Worley (2011) explained, “Developing the right organization profile of

skills and competencies is the foundation upon which the system needs to rest, because it

provides the guidelines for staffing, recruiting, development, and rewards, and should be an

important input to the strategizing activities of the organization” (pp. 234-235) (principle #1). In

this regard, McGinn’s would not appear to meet this criterion since it looks for and relies more


on job descriptions as a means of deciding the kind of talent it needs to look for. For instance, if

McGinn’s needed a new line cook to fill a vacant position, it would rely more on this job

description as a means to drive its talent management instead of coupling it with assessments to

link a potential hire to the company’s environment and atmosphere (Pulakos, 2013). These

objective hiring assessments attempt to match the person to the organization as a means of

matching culture, norms, or values to increase the likelihood of someone being a good fit for the

team. In the case of McGinn’s, it seems as if it hires new employees based on a gut check that

they are the right person for the job (“otherwise we would not hire them in the first place”).

Nicole expressed it best, “We are like a family. We work together and play together.”

Next, McGinn’s uses targeted talent management (principle #2) in the sense that it takes

into account the importance of the work that cooks, especially, bring to the organization. For

instance, as a restaurant primarily, McGinn’s relies more on the cook’s ability to deliver quality

food in a relatively short time. If for arguments sake, the food served to customers was

consistently poorly prepared and handled, McGinn’s would not manage to stay in business very

long. As such, cooks tend to be paid more than waitresses and bartenders.

McGinn’s does not use contract or outsourced labor in any part of its full, part-time or

temporary staff (principles #3 & 4). However, when it comes to machine or equipment (e.g.

grills, ovens, deep fryers) maintenance for instance, it does make use of the specialized

knowledge possessed by skilled tradesmen (e.g., plumbers, electricians) as necessary. Contract

labor in general does not work well in most of McGinn’s daily operations since it relies a great

deal on the core competencies of its general staff.

When it comes to career diversity, however, McGinn’s does offer a variety of career

paths including temporary, part-time, and full-time positions (principle #5). This appears to be a


fairly important aspect of McGinn’s particular approach to talent management since it shows

respect for differences in “career objectives, work-life balance preferences, and career state”

(Lawler & Worley, 2011, p. 238). As an example, some employees work at McGinn’s only

during some of its most busy and profitable events (e.g., Bluemound Road St. Patrick’s Day

Parade).

Based on the interview responses, McGinn’s unique employer brand does appear to fit

the organization’s purpose, identity, and strategic intent (principle #6). As such, many of

McGinn’s current employees would seem to be attracted to its values, informal structure, and

purpose. Indeed, one interviewee noted that she started working for McGinn’s a few months ago

although initially she had not even considered applying. Prior to being hired, she explained how

she was a frequent customer and thought McGinn’s would be a “fun place to work.”

McGinn’s also adopts an approach to career management aligned with that of an SMO.

That is, career management is primarily the responsibility of the employee (principle #7). While

HIOs and CCOs tend to assume a considerable role in the careers of their employees, SMOs

focus more on providing a level of business transparency and job information necessary for

employees to make informed career decisions (Lawler & Worley, 2011). While one of the main

reasons SMOs should avoid managing the careers of their employees is because rapid

technological and environmental change may render any advice the organization gives obsolete

in a relatively short amount of time, McGinn’s tends to take a more hands-off approach due to

the fast pace of the business. In short, there is little time to train or even manage employees

much beyond a certain, reasonable extent.

Talent management at McGinn’s is primarily the responsibility of top management since

it has no human resources department or top executive positions. However, the degree to which


top management considers talent management a high priority or has prior training and expertise

in areas of talent management and sustainable effectiveness appears minimal (principle #8).

Nevertheless, since McGinn’s top managers work shoulder-to-shoulder with subordinates, they

may possess a considerable amount of knowledge regarding how to develop individual

employees effectively as well as the value of human capital.

Lastly, the talent management principle of the human resources function (principle #9)

does not apply in this case. Regarding McGinn’s approach to “travel-light” talent management,

it does not appear as though McGinn’s is entirely receptive of an SMO employment contract or

deal that does not offer at least some degree of “job security” or a “career employment

relationship” to its employees (Lawler & Worley, 2011, p. 241).

Unit 9: Leading, managing, and following

McGinn’s culture is one largely characterized by cooperation and shared leadership

where there is the potential for anyone to lead. As pointed out by Bansal and Roth (2000),

“firms motivated by ecological responsibility often pointed to a single individual who had

championed their ecological responses” (p. 728). In the case of McGinn’s, with its culture

characterized by cooperation and ‘anyone can lead’ mentality, this poses a new avenue of

approaching sustainability and factoring in ecological concerns. Since leadership seeks to

inspire others while working side-by-side with employees there is the potential for aspiring

widespread acceptance of ecological responsibility. When looking to the four SMO leadership

principles, McGinn’s does an excellent job by meeting all four. These are: establishing a

sustainable leadership brand (#1); senior management must support building the leadership

capability (#2); develop managerial and leadership skills (#3); and commit to transparency (#4).


McGinn’s approach to leading, managing, and following begins by its development of a

leadership brand marked by respect for the company’s employees. As mentioned earlier, when

senior management is absent it is up to entrusted employees to make certain decisions. In

addition, McGinn’s managers generally tend to take a “hands-off” approach when it comes to

decisions that they feel do not require immediate or greater attention. In short, “Show me that

you can handle it.” As such, management seems to be as open and honest as it can be while

attempting to foster a culture of shared leadership and responsibility. This is important as it

embodies the idea that “a brand is a promise, and in an SMO the leadership brand should contain

promises about sustainable effectiveness, about truthfulness, and about transparency” (Lawler &

Worley, 2011, p. 269) (principle #1).

Similarly, managers take steps to build and support leadership capability by serving as

role models and advocates of shared leadership (principle #2). Moreover, McGinn’s stresses that

there will come times when employees will be “forced to make decisions on their own.” This

might include something as small as offering a customer a free menu item if there was a problem

with their order or they were not satisfied with some other aspect of their dining experience;

however, there may also come a time that something much more serious happens (e.g., customer

choking, robbery).

Next, Lawler and Worley (2011) argued that “organizations need a clear, well-developed

set of leadership competencies that managers must master (as cited in Arendt, 2013) (principle

#3). In McGinn’s case, this very much appears to be the case as both current managers started

out and have developed along with the business to where it is today. While a 360-degree

approach to collecting feedback from multiple stakeholders is lacking, McGinn’s currently does

incorporate input from a wide range of stakeholders. This input could springboard a 360-degree


program, and when done well, allows all team members to improve weaknesses, involves key

leaders, and highlights an individual’s strengths that add value to the team effort (Jackson, 2012).

Thus, while the company is doing fairly well in this regard there is certainly room for

improvement.

A commitment to transparency (principle #4) also seems to characterize McGinn’s

approach to leadership and managing: when it comes to how well the business is doing

financially, any issues that might be ahead (e.g., not able to hire as many temps for an upcoming

sports/events season, potential layoffs), or if any new/additional shifts are available. One benefit

for McGinn’s in this regard is that remaining committed to transparency will assist employees in

managing their careers by knowing what opportunities exist within the company and how they

might be able to take advantage of those opportunities (Lawler & Worley, 2011).

Unit 10: Transforming to sustainable management

In contrast to the fast pace of McGinn’s business, it is primarily cautious and slow when it

comes to embracing and implementing change. Nevertheless, McGinn’s adopts an approach to

performance management and possesses an organizational structure that allows for and

encourages change and responsible behavior. This includes rating outcomes and setting

measurable goals while also seeking to maximize its surface area. Indeed, McGinn’s already has

been able to develop excellent collaboration capabilities within and outside of the company in

the form of customers, colleagues, neighbors, and community. McGinn’s has also demonstrated

its ability to embrace change, in part by looking to social media and seeking to improve

transparency – when it perceives change as something positive and beneficial to the business. A

management approach that could prove beneficial for the change adverse McGinn’s is the

ADKAR Model. This model incorporates awareness, desire, knowledge, ability, and


reinforcement as a means to understand the need for change, implementation, and sustainment of

change (NYU, 2013). As expressed by Worley and Vick (2005), organizations need to manage

strategy and change “in the face of demographic trends, technological innovations, and

globalization.”

While McGinn’s still has a considerable amount of work to do in becoming a full-fledged

SMO, there are some simple ways in which it can start to make its transformation. For instance,

the 2008 International Chefs Congress provided as many as 30 steps towards a more sustainable

restaurant that McGinn’s can pursue (StarChefs, 2013). These suggestions include everything

from sourcing local food to replacing Styrofoam take-out containers with ones made from

recycled materials.


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http://www.paypeopleright.com/reward_principles.htm


Appendices

General

1. What is the name of your organization? Give a short history of the organization. Describe how it has grown and developed. Be sure to identify when your organization was founded, and who founded it.

McGinn’s Sports Bar https://www.facebook.com/pages/McGinns-Sports-Bar/163911966161

1998 – McGinn’s opened by Slim McGinn in Milwaukee, Wisconsin. Current co-owners (Marty & Jeff) have worked at McGinn’s since it opened, managing

the kitchen and bar respectively. 2001 – Marty and Jeff purchased McGinn’s from Slim McGinn. McGinn’s received steady business from 1998 – 2008. McGinn’s was hard hit by the 2008 economic recession, but has since slowly been

gaining back more business. Nicole Wey (assistant kitchen manger & daughter of Marty) attributes some gain in

business to McGinn’s participating in a free “bus shuttle” program to Brewers games “a couple of years ago.”

Prior to participating in the bus shuttle program, Jeff “would take customers down to the games in his car.”

2. What does the organization do? What goods and services does it produce/provide? What kind of value does it create? What is the organization's mission?

Purpose/Identity: (Nikki) it is a “sports bar with more focus on the restaurant aspect.” (Marty) “We are an old school tavern (bar/restaurant)”

Goods/Services: Irish/American style food; alcohol Value Creation: large regular customer base; supports/sponsors sports/arts/scholarships at

several local high schools; works with & donates to various clubs/shriners; part of the Bluemound Business Association; Bluemound Road Parade committee; remains open to (Nikki) “other good causes that come along.”

Mission: (Marty) “make money”

3. Describe the organization's inputs, processes, and outputs.

Input: Raw foods/products (e.g. meat, dairy, alcohol), staff/management (e.g. cooks, waitresses), machines/equipment (e.g. grills, ovens, deep fryers), money (i.e. via customers)

Processes: food production (i.e., raw food materials to final products), customer service (e.g., bartending, food orders), monetary transactions (e.g., supplies purchasing, sales)

Output: profit, waste (e.g. food, paper, plastic), wages, expenses, satisfied customers, committed employees

https://www.facebook.com/pages/McGinns-Sports-Bar/163911966161


4. Read the organization's Annual Report (10-k) or other documentation and determine which kinds of goals, standards, or targets the organization is using to evaluate its organizational performance. Valuable website: http://www.sec.gov/edgar.shtml; (Look especially at the most recent 10-k.) What goals do you use to track your performance? In other words, how do you know if you’re doing well? What data do you look at to help determine this?

Not applicable. (I could not find McGinn’s listed on this website) (Nicole): “In the kitchen we keep track of how many plates we serve for the day shift and

evening shift. We write these numbers down on a calendar, and we keep it for a year to compare the next year’s numbers. I believe they also keep the daily reports that they print off the register to compare numbers.”

5. Identify the organization's major stakeholder groups. How much influence over organizational decision making does each stakeholder group have?

Customers: considerable influence (i.e. they often provide input/feedback) Employees: considerable influence (i.e. McGinn’s has an open door policy) Management: greatest level of influence Members of the Community: (Nicole): “The most influence customers/regulars have is

suggestion for food and drink specials. We also used regulars suggestions for things to do for special events, i.e. Bring your daughter to the bar day, and Island Getaway party.”

6. Draw a picture of the organization's hierarchy of authority. How many people does your organization employ?

(Owners/Managers) 2 – Marty & Jeff (Assistant Kitchen Manager) 1 – Nicole (Cooks) 2 – names unknown (Bartenders/Waitresses) 14 – names unknown

Unit 1 – Chapter 3: Strategies for Sustainable Effectiveness See pp. 68-69 for more

information on how to think about and address these questions.

7. How would people in the organization respond to the following question, "Even in turbulent times, what won't change about the company?" What does the response imply about the organization's identity? Is it strongly held, i.e., is there a consensus as to what the organization's identity is? Is it clear? Is it well understood?

Response: (Nicole) “We haven’t changed our hours, and haven’t raised our prices in about 7 years (although prices are about to change). We continue to add new products, especially new beers and liquors. We always know how to have fun.” (Marty) “Fun times and a pleasant work environment.”

Indicates: identity is fairly strong (i.e. fun place to work; one response matches, while another indicates a consistent, stable work environment)

http://www.sec.gov/edgar.shtml


8. What do senior leaders talk about with respect to competitive strategy? In other words, do senior leaders spend time considering how they might be able to get more customers and/or make more money?

Response: (Nikki) “I don’t think we have one.” (Marty) “N/A” (Nicole): “Of course we think about it (get more customers & make more money). The

only advertising we do is through ads in high school athletic programs, and the free use of Facebook.”

Indicates: there is no (identifiable) competitive strategy; org may assume and/or depend on a stable world (i.e. people have to eat) However, answer to #9 indicates a competitive strategy based on keeping costs low, trying new promotions (i.e., new dishes), and by providing quality food as well as an enjoyable atmosphere/eating experience.

9. How does the organization think about growth?

Response: (Nicole) “We continue to offer new products. We have been relying on Facebook for sharing our daily specials and events. We are looking into adding outdoor seating and Marty is always looking to improve the dining rooms/building.” (Marty) “Watch costs, try new promotions, provide quality food.”

Indicates: Org adopts an open, yet conscious (cautious) approach to growth

Unit 2 – Chapter 4: Developing a Strategy See pp. 94-95 for more information on how to think

about and address these questions.

10. How does the organization approach long-term, medium- and short-term futuring? Provide example. (Interviewees instructed to select one and elaborate if possible).

Answer Choices: A. Our managers are reasonably well-informed and we do have strategic planning meetings, but looking out beyond 12 months is not an important part of our approach to management. B. We do have a futuring process in which we do things like scenario planning, but I’m not sure how the information is used. C. We are very future-oriented and have the culture and the processes that support futuring.

Responses: (Nicole selected A) “In this business it is a day to day operation. Most of our business revolves around different sports seasons.” (Marty selected A) “Mostly weeks and months as our business is tied to sports seasons.”

Indicates: org focuses on short-term futuring only; may indicate org is unable to seize on temporary competitive/momentary advantages

11. Who is involved in the organization's strategic thinking and planning? Do they actively solicit ideas from employees, or wait for employees to offer ideas?


Responses: (Nicole) “Mostly Mary and Jeff; anyone who wants to help;” (Marty) “Any employee who wishes.” (Nicole): “Both. We have a very comfortable and laid back work environment where employees are comfortable with expressing opinions.”

12. To what extent does the organization embrace inputs from outside the organization vs. maintaining a "behind closed doors" mind-set? To what extent does the organization collaborate with stakeholders to maximize its perspective?

Responses: (Nicole) “We will listen to anyone’s input. We are always open to new ideas that might bring more customers in.” (Marty) “We often ‘take requests’ from customers for specials, soups, and/or events.”

Indicates: an active and advantageous strategy of openness and collaboration from a wide range of stakeholders

Unit 3 – Chapter 5: Board Governance See pp. 125-126 for more information on how to think


13. Would having an advisory board of some kind be perceived as helpful to McGinn’s? For example, a business advisory board of some sort.

(Nicole): “Perhaps. Management was going to have a monthly meeting to discuss business, but it only lasted one month.”

14. How diverse is the know-how and perspective of the board? Which stakeholder groups does the board represent? How are board members selected?

N/A

15. What committees does the organization have? What is their purpose?

N/A

Unit 4 – Chapter 6: Structures for Sustainable Effectiveness See pp. 153-154 for more


16. Describe the organization's surface area. To what extent are internal and external customers valued? How are their concerns addressed? (Interviewees instructed to select one and elaborate if possible)

A. Most managers spend their days talking only to other internal managers; talking to customers or external stakeholders is rare except for a few roles. B. There’s a strong customer focus here – we listen to both internal and external customers. C. We naturally have a strongly external focus due to our structure (for example, small business units), processes, or culture


Responses: (Nicole selected C) “We listen to our customers input, and we also support our neighboring businesses, and respect our residential neighbors. We have good relationships with those that are closest to us.” (Marty selected option C)

Indicates: both managers and employees are close to their customers, competitors, and perhaps, other stakeholders as well (i.e. those who have a closer, more direct stake in the org).

17. Describe the organization's structure. Is it centralized or decentralized? In other words, at what level of the organization are different kinds of decisions made? Provide examples.

Responses: (Nicole) “Most of the decisions are made by the owners, but most of the employees can be trusted to make good decisions on their own when the owners aren’t around.” (Marty) “Most decisions made at the top but many employees are able to make good decisions when owners are not present.”

18. Is behavior in the organization very standardized, or does mutual adjustment play an important role in coordinating people and activities? In other words, to what extent is employee behavior driven by rules and standard operating procedures vs. situation-specific responses? Provide examples

Responses: (Nicole) “For the most part everyone just works together to get things done. That includes day to day prep work, cleaning, and customer service.” (Marty) “In this business every day is as different as it is the same.”

Indicates: more focused on mutual adjustment in coordinating people and activities; Nicole indicates in the next question that McGinn’s has no clear rules or SOP.

19. How formalized is the organization? In other words, to what extent are the organization's rules and SOPs written down? Provide examples.

Responses: (Nicole) “It is VERY informal. There are no rules or SOPs written down.” (Marty) “We use ‘the code’ – do unto others as they would do unto you.”

20. To what extent is the structure more traditional, i.e. functional vs. less traditional and more geared to innovation, i.e., matrix or network-oriented?

Indicates: org appears to fit the description of a nonstandardized, functional structured organization (i.e. specialties such as cooking, waitressing, bartending)


Unit 5 – Chapter 7: Sustainable Work Systems See pp. 173-174 for more information on how

to think about and address these questions.

21. To what extent is work designed around activities vs. jobs? Provide examples. (Interviewees instructed to select one and elaborate). Also, briefly explain each position’s job duties (waitress, cook, bartender).

A. To a large extent we already do so; it’s about time we stop pretending we had job titles, since that concept has been largely obsolete for years. B. There are a few places where this could work, but not in most of the organization. C. Well-defined jobs are so much a part of how we do things that suggesting an alternative isn’t worth doing.

Responses: (Nicole) “Definitely A. We are like a family. We work together and play together. It’s about getting the job done as a whole, yet just doing our particular jobs.” (Marty) “Not so much ‘stop pretending’ as what can I do to help. It’s about getting the job done.” (Nicole): “Waitress: customer service (greeting customers, taking order, serving food), clean tables when customers leave, dishes, roll silverware, keep waitress stations stocked, keep table items clean and stocked, (salt & pepper, ketchups, mustards, menus). Bartender: customer service (greeting customers, taking orders, serving food & drinks), dishes, keeping bar area stocked and clean. Cook: serving up quality food quickly and efficiently, keeping kitchen clean and stocked, prepping food items, keeping basement clean and organized, ordering and putting away food stock, dishes, basic building maintenance, shoveling.

Indicates: work is guided by shared goals (i.e. getting the job done) but work is still based on job duties (e.g., cooking, waitressing, bartending) more than activities (i.e. each employee does his or her assigned job)

22. How specialized (narrowly defined) are jobs within the organization? Provide examples.

Responses: (Nicole) “We have two different job areas, front of the house (bartenders and waitresses) and back of the house (kitchen). Each area has its own things it needs to do, but we still work together on a lot of things.” (Marty) “N/A”

Indicates: jobs are relatively narrowly defined according to job titles and assumed duties

23. To what extent is work guided by shared goals vs. functions (e.g., production, sales, accounting)? Provide examples.

Responses: (Nicole) “Our shared goal would be to get the work done, while having a good time, and making sure the customers have a good experience.” (Marty) “Everyone’s goal is to provide a good/fun bar/dining experience from when they enter to when they exit.”

Indicates: goals are shared perhaps more than functions


24. To what extent is work performed by teams, including multiple stakeholder teams, vs. individuals? Provide examples.

Responses: (Nicole) “Menu specials and event planning tends to be more or less done by ‘teams.’ Employee/customer input is taken into consideration. Mary does most of the planning and work for events by himself. We try to work together to complete everyday tasks.” (Marty) “N/A”

Indicates: every day activities (e.g. cooking, waitressing) are completed individually while “special events” incorporate more stakeholders (i.e. management, employees)

25. To what extent do managers see their job as "thinking about creating processes in which the right people are involved and the right sequence of tasks is carried out" (p. 173) vs. in terms of the four traditional functions of management: planning, controlling, organizing, and leading? Provide examples.

Responses: (Nikki) “We just work together to get everything done.” (Marty) “This process is the basic ‘order of the day’ in this business.”

Indicates: org carries out the traditional management function of planning, leading, organizing, and controlling in a manner similar to that of an HIO (i.e., entrusting employees with some level of power, supporting their development and skills, and by letting them influence operational decisions).

Unit 6 – Chapter 8: Managing Performance See pp. 198-199 for more information on how to

think about and address these questions.

26. Review the eight (8) Universal Performance Management Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles? Total # & type of principles met: (3) #3 – Set measurable goals; #4 – rate outcomes, rate

performance, but don’t rank people; #8 – use 360-degree appraisals but not for rewards Principles not met & obstacles to achieving them: #1 – identifying and communicating its

business strategy; #2 – establishing a performance management system tied to strong senior management leadership; #5 – requires a system in place to appraise & reward managers and employees; #6 – establishing, performing, & communicating a performance management system; #7 – establishing a performance management system in which rewards are linked to performance.

27. Review the six (6) SMO Performance Management Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles?

Total & type of principles met: 0


Obstacles to achieving these principles: requires that a performance management system be put into place

28. What does top management see as the purpose of performance management? To what extent is performance management a means for deciding merit raises and bonuses vs. a core HR process for talent management vs. a business process for managing sustainably effective performance? Provide examples.

Not applicable. (Performance management system not in place at McGinn’s).

Unit 7 – Chapter 9: Reward Systems See pp. 224-225 for more information on how to think


29. Review the five (5) Universal Reward Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles?

Total & Type of Principles met: (2) #1 – creates rewarding work assignments (e.g. performance feedback from customers and other workers); #2 – forget merit increases, give bonuses (e.g. cash bonuses based on good performance)

Principles not met & obstacles to achieving: #3 – establishing a system of rewarding team work/projects (org would first need to make opportunities available to work in teams or on projects); #4 – establishing a system of rewarding organizational performance; #5 – establishing a quarterly or semi-annual reward cycle

30. Review the seven (7) SMO Reward Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles?

31. How open is your organization to innovative approaches to reward? For example, paying employees based on their performance rather than hierarchy in the company, ability to work in a group, ownership stake in the business, etc.

(Nicole): “Pretty much employees are paid based on performance. We don’t give raises often, and when we do, it is because an employee has proven their worth and shown that they deserve to be paid more. We had a cook recently that received 2 (small) raises before he even got his first pay check. We take care of our employees that work hard. Cash bonuses are a way we like to show that.”

32. How would your organization react to transparent pay? In other words, can employees find out how much other employees make?

(Nicole): “Only if they ask someone what they make.”


Unit 8 – Chapter 10: Managing Talent See pp. 249-250 for more information on how to think


1. Review the nine (9) SMO Talent Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles?

2. How does top management approach talent management?3. How close is your organization to a "travel light" approach?

Unit 9 – Chapter 11: Leading, Managing, and Following See pp. 276-277 for more


1. Review the four (4) SMO Leadership Principles. How many does your organization currently meet? Which ones? Provide examples. If there are principles not met by your organization, what are some obstacles preventing your organization from adopting these principles?

2. What is your organization's leadership brand?3. How does your organization react to shared leadership?

Unit 10 – Chapter 12: Transforming to Sustainable Management

1. Describe how your organization manages change (see pp. 293-303). What is your overall evaluation of your organization's change management approach?

2. Overall, considering everything, where is your organization in its journey to become an SMO? Not even considering such a transformation? Just starting out? Making good progress, but some ways away from the desired goal? Almost there? Definitely there?