CPS Project 2 Final (Formatted Draft 1)

RETAINING HIGH QUALITY EMPLOYEES THROUGH GAIN SHARING 1
INPUTS THAT DETERMINE OUTPUTS:
RETAINING HIGH QUALITY EMPLOYEES THROUGH GAIN SHARING
Group 3
Brandon Wilson
Kyle Weitzel
David J. Williams
Dr. Margaret Lucero
MGMT 4340
March 30, 2014

Introduction: Background
Getting optimal output from employees can be a formidable challenge. The opportunity
for employees to maximize their skills and abilities can often be an abstract, nebulous endeavor
that doesn't translate within a job description, leaving the employee to reduce their job to simply
being a function that meets their material needs. There are methods, however, that exist to bring
out the most in employees, giving them a sense of purpose greater than that of meeting their
immediate material needs.
Central to these methods is providing incentive - giving employees a reason - to reach
their full performance potential. Coffee Waves, a local coffee shop which sells high end coffee,
hand -made gelato, pastries and sandwiches, is one such company dealing with these issues.
Founded in 2008 with three locations in Corpus Christi and one in Port Aransas, the typical
employee is a student in their 20's who embodies the custom coffee boutique experience. As
such, David Bendett, the owner of Coffee Waves Port Aransas, has been able to capitalize upon
the local employment resources available to be functionally operational to serve his growing
clientele of locals, snowbirds (people from up north who winter in the area), as well as the
swelling tourist populace during peak season.
As we found recently during our interview of Bendett, his greatest problem was not
attracting employees who are able to develop the skills necessary to fulfill the mission of Coffee
Waves, but rather retaining those in whom he has invested and come to rely upon. Our research
involved numerous employee and management surveys, interviews with the owner and
managers, as well as articles to meet this challenge.

I. Integrative Model of Motivation Enhancement
1. Goals/Expectations
Table
Motivation Survey: Coffee Waves Employees
Source: Coffee Waves Staff – Location: Port Aransas
The above questions were asked to gauge how well the employees understood their
manager's expectations and the degree of fairness they viewed their duties to be. We asked these
questions to generate responses in order to gauge how well management is communicating goals
or task assignments. The mean of means of 4.29 out of 5 indicates that there is good
communication from management to employee about what is expected of them.
This is interesting because the employees do not have defined job descriptions, and
conducts themselves according to a list of shift duties that must be completed while on shift.
Lindsay, the manager, is the only person that has a clearly defined job description. Some curious
responses were generated on Survey 5 for questions 2 and 6. This employee is likely frustrated in
the lack of communication of job tasks and feels that some aspects of his shift duties are
unreasonable.
1 My supervisor and I agree on the quality of my performance. 4.57 5 4 4.57
2 I understand my boss's expectations and generally feel they are realistic. 4.43 5 3 4.43
3 I believe my boss's expectations are unclear and unrealistic. 1.71 2 1 R 4.29
4 I believe that feedback on my performance us usually fair. 4.29 5 3 4.29
5 My job is sometimes hard. 4.00 5 2 4.00
6 Some aspects of my job are unreasonable. 1.86 3 1 R 4.14
Goals/Expectations 4.29

2. Ability
Table
Path/Goal Theory is the importance of fitting the right job to the right person and
providing the necessary resources and training. These factors must be combined with effective
goal setting if increased effort is to result in increase performance. The role of the supervisor is
played in offering resources and training, while removing the obstacles of success. We authored
these questions to generate responses on how well the employees are prepared to complete their
task assignments.
Their apparent ability level is good, since this section reported a strong mean of 4.45 out
of 5. Because of this high score, it has led us to believe that since the shift duties is the basis of
the employee expectations, and since Bendett trains each employee personally to ensure quality
training as well as orientation, the employees feel prepared and able to meet the supervisor's
expectations of completing their shift duties.
The only outlier in this section was again on Survey 5. On Survey 5 Question 3, the
employee expressed a neutrality on the basis of having adequate resources to do his job well. If
1 I feel I have adequate training to performmy current job assignments. 4.71 5 4 4.71
2 I believe that my native skills and abilities are matched very well with my job responsibilities. 4.86 5 4 4.86
3 I believe that I have adequate resoures and supplies to do my job well. 4.00 5 3 4.00
4 I could do a much better job if I had more training. 1.86 3 1 R 4.14
5 I believe that my job is too difficult for my ability level. 1.14 2 1 R 4.86
6 I believe that my job performance is hindered by a lack of supplies, resources, or training. 1.86 3 1 R 4.14
4.45Ability

this is the case and he is neutral about being prepared to do his job, there could be a possible
barrier to this employee's success in achieving the goals and expectations set before them.
3. Reinforcement
Table
Behavior with positive consequences tends to be repeated, while behavior with negative
consequences tends not to be repeated. This section has a surprisingly low mean of 3.79 out of 5.
In this section, we asked questions to generate responses about how well good and bad
behavior/performance are addressed. In Question 1, Surveys 5, 6, and 7 responded negatively to
how reasonable the rewards are. This could be the basis of both reinforcement or salience.
Survey 5 generated a response that indicates that this employee feels the supervisor plays
favorites when doling out rewards. They also do not feel that the rewards are worth extra effort
and that corrections to their performance are not well communicated. Corrections on poor
performance and reprimands seem to not be well communicated, generating a mean score of 3.7.
This could possibly mean that either there is no poor performance (unlikely), or that management
is not very assertive when it comes to correction or reprimanding employees.
1 I believe that rewards (pay raises, affirmation, days off, prefered shifts) are reasonable. 3.29 4 2 3.29
2 My boss plays favorites when dealing out rewards. 2.00 5 1 R 4.00
3 The rewards to good performance are worth extra effort. 3.43 5 1 3.43
4 I amusually not corrected in a timely mannerif I amdoing something incorrectly. 2.14 4 1 R 3.86
5 I have good job security. 4.43 5 3 4.43
6 Corrections to my performance are well communicated. 3.71 5 2 3.71
3.79Reinforcement

After reviewing Reinforcement Theory and how it applies to these employees, we feel
like there is an Outcomes Issue, based upon extrinsic and intrinsic elements. Extrinsic outcomes
are reinforcers like pay, promotions, or praise, given to an individual employee from either
management or coworkers, affirming the employee's efforts and performance. If an employee
gets a compliment on how well they made a drink or how well they cleaned the coffee shop
during or after their shift, this boosts the confidence of the employee and fosters a sense of self-
worth in their work.
This leads us to the intrinsic outcomes. Intrinsic outcomes are what the individual feels
about themselves as a direct result of how well they performed; the employee's feelings of
accomplishment, self-esteem, and the personal development they experience as a byproduct of
their good performance. Our surveys have identified a disconnect between the extrinsic and
intrinsic outcomes, suggesting that management is very good at verbal reinforcement while
rarely ever reprimanding the employees. This, coupled with the lack of significant reward or
advancement opportunity diminishes the value of the affirmation and praise the management
team gives the employees. As such, the lower-level employee positions are viewed as mundane,
monotonous, and unfulfilling.
These surveys show that the employees feel they have maximized their input, and as
such, the seeming reward is hardly worth the effort. The lack of tangible reward leads
employees to become complacent, which ultimately diminishes their overall performance.

4. Equity
Table
This section reported a mean 2.79 out of 5. This poor equity perception would appear to
stem from reinforcement issues between management and employees. For example, in Survey 5,
since they marked neutral and disagree on some questions from the Reinforcement section, it is
likely that they feel they are underappreciated in the business. The Survey 5 responses on
questions 2, 3, 4, and 5 lead us to believe that this employee is having an equity issue.
An interesting response came from Survey 5, 6, and 7 on question 5, stating they strongly
agree with the statement that they are worth more than what they are getting paid. These same
employees all strongly agreed that they work harder than some of their other coworkers. This is
telling since Survey 6 answered that they strongly agree that promotions and pay raises are fair.
This is likely one of the managers who feel they fairly earned their promotion or pay raise.
1 My supervisor indicates that I amnot performing as well as I should, but I disagree. 1.29 2 1 R 4.71
2 Rewards are distributed fairly, based on performance. 3.71 5 3 3.71
3 I feel I'mworth as much to the business as someone who out-performs me. 2.71 4 1 R 3.29
4 Are promotions and pay raises fair? 3.43 5 1 3.43
5 I believe I amworth more than what I amgetting paid for what my job is. 3.43 5 1 3.43
6 I work harder than some of my other coworkers. 4.14 5 3 4.14
3.79Equity

5. Salience
Table
To examine Salience, we built questions around whether or not rewards are meeting the
needs of the employee and would act as sufficient reinforcement. If the rewards are not appealing
to the employees, they are likely to reject or undervalue some reinforcement rewards, leaving
them under-motivated.
First, we examine Murray's Manifest Needs Model. In this, Murray proposes that
individuals can be classified according to the strengths of their various needs. Murray proposes
dozens of needs, but only three are relevant in the workplace, including the needs for
achievement, affiliation, and power. This section recorded a mean of a mere 3.48 out of 5. This
likely indicates that the reinforces are either not matching the equity needs of the employees or
are not matching what each individual's needs.
The need for achievement is defined as "behavior toward completion with a standard of
excellence…" Questions that relate to the need for achievement are questions 3 and 5. These
1 I do not find the rewards and opportunities available to high performers very appealing. 2.43 4 1 R 3.57
2 The rewards that are offered to me forhigh performance meet my needs. 3.00 4 2 3.00
3 The rewards that I receive make me want to work harder. 3.43 5 1 3.43
4 The rewards that are available to me are attractive to me personally. 3.43 5 2 3.43
5 All rewards are the same, no matterwhat the performance. 2.71 5 1 R 3.29
6 I experience personal growth working in my position. 4.14 5 3 4.14
3.48Salience

received moderate responses, likely because the achievement of the goals is simple, with all
employees being able to achieve them, thus rewarded the same.
Next, the need for affiliation involves "attractions to other individuals in order to feel
reassured and acceptable." The question related to this need is number 6, which generally
received a good response. Experiencing personal growth in their position makes the employees
reassured about their surroundings as well as makes them feel accepted when working partner
shifts.
The last need is the need for power. This need represents a desire to influence others and
be controlling. If a person's need for power is high, their need for rewards other than verbal is
likely higher. Since they desire power, they are likely to respond well to monetary rewards
instead of reassurance. In other words, money is power, and when they are being rewarded with
more power or money, they have a higher salience. Questions 1, 2, and 4 deal with the monetary
aspect of salience and how appealing those rewards are.
6. Timelines
Table
1 Feedback on how I am performing comes often. 3.71 5 2 3.71
2 I receive performance feedback that helps me do my job better. 4.43 5 4 4.43
3 Raises and other performance rewards don't come often enough. 2.29 3 2 R 3.71
4 My supervisor is easily accessable to talk about my performance. 4.14 5 3 4.14
5 Management is too busy to care about the employees. 1.29 2 1 R 4.71
6 Opportunity for advancement is available if I work hard enough. 3.71 5 2 3.71
4.07Timeliness

Timeliness is all about providing expeditious rewards and accurate feedback. Until now,
we have examined that the goals and expectations must be clearly communicated: the employees
must have the ability/training/resources to complete those goals and expectations, while rewards
and corrections must be administered to reinforce the performance in completing the goals and
expectations. The rewards and corrections must then be justified and dealt on a fair basis, and
that the rewards and feedback must meet the personal needs of the employee.
Now, we examine how these elements must exist and be introduced on a timely basis in
order to ensure that the reinforcers are producing desirable behaviors. The importance of
timeliness becomes prevalent when dealing rewards. If the reinforcers are not dealt on a timely
basis, they could be taken for granted or be critically undervalued. Questions 1 and 3 deal with
how often feedback and rewards come. Both of these sections scored low. This could mean that
management does not provide enough feedback or incentive to better performance.
Question 2 blatantly asks if there is any exchange of information on how well the
employee is performing. And finally, Questions 4, and 5 deal with the accessibility of the
management. Accessibility could act as a facilitator of feedback. It seems as though feedback is
accessible.
Motivation Analysis Summary
According to this Motivation Analysis, Coffee Waves is doing well in their feedback, but
not so well with rewards.
 Since they do not have defined job descriptions, job positions tend to be seen by
employees as ambiguous.

 The employees conduct themselves according to their shift duties and are regularly
verbally affirmed for their performance.
 Solving disconnection between the Intrinsic and Extrinsic outcomes of their performance
is the main key to success.
 To solve the intrinsic outcomes, management must fabricate job descriptions and must
implement regular employee evaluations to reinforce these job descriptions.
 After employee evaluation, the employees must be given rewards for good performance
that are greater than mere affirmation and praise.
David Bendett is the kind of owner that will praise an employee at any given moment,
promising advancement and sometimes even monetary compensation, but has trouble following
through because of either a lack of opportunity, a lack of means, or a combination of both. This
is giving the employees a jaded perspective when accepting David’s praises.
In particular, one employee said in an interview, “Yeah, you tell me that I’m doing
awesome all the time, but you still pay me the same as when I started and wasn’t that awesome.”
This translates to low satisfaction among the employees who struggle with dealing with intrinsic
and extrinsic outcomes. This low satisfaction leads to low performance and complacency until
the employee, highly trained yet poorly motivated, finally starts looking for different or better
opportunities outside of Coffee Waves.
This seems to be where our problem lies. This model was very efficient in measuring the
different levels of motivation. Goals, ability, reinforcement, equity, salience, and timeliness play
enormous roles in employee job satisfaction. The measurement of each of these facets of
motivation proved very helpful in recognizing key management and ownership issues in the

business. With this information, we can move forward in addressing the Outcomes portion of this
model, where Coffee Waves is lacking
II. Apply CPS material to describe the work environment and the susceptibility to a
creative solution
Figure
The Four Elements of Appraising
Source: Creative Approaches to Problem Solving, 3rd Edition
The Work Environment.
People involved. Coffee Waves is a locally based boutique coffee shop catering to
students, and coffee gourmands offering high end coffee blends as well as handmade gelato,
pastries, and sandwiches. The brand is comprised of three stores in Corpus Christi and one in
Port Aransas. Coffee Waves is a partnership endeavor between three owners, one being David
Bendett, a local pastor who owns the Port Aransas store and is negotiation to purchase another
Corpus Christi location.
CONTENT
Understanding
the Desired
Results
CONTEXT
Understanding
the situation
METHOD
Understanding
the process
options
PEOPLE
Uniderstanding
the people
involved
The four elements of Appraising
Tasks

Coffee Waves relies upon a young, energetic base of employees who embody the coffee
shop culture; about 70% are college students and nearly all are in their 20's. The clientele is a
diverse mix consisting of those who appreciate high end coffee as well as the high end coffee
shop atmosphere.
Content. The business model of Coffee Waves takes direct aim at Starbucks and seeks to
replicate that success on the local level. As such, David Bendett relies upon his pool of
employees to personify this consistent, high level of service as well as production of Coffee
Waves products on a daily basis.
Context. Since its inception in 2008, Coffee Waves has seen consistent 20% growth.
Coffee Waves has done a very good job of finding and exploiting its niche; it is the only place in
the area where one can find handmade gelato. It has a steady and consistent following among its
client base and has done very well building upon the coffee house culture patrons seek; it's a
quirky-creative environment with a sense of familiarity that is inviting and welcoming. On one
level, Coffee Waves has done a good job of developing a culture among its employees, however
not to the level, on an operational side, that they can compete with a national franchise.
Method. We used Critical Problem Solving tools including interviews, and surveys,
while further evaluating our data to make determinations about the process.

Applying CPS to Work Environment
Table 6.1
Factors to Consider when Planning your Approach
Importance
Need of new innovative ways to retain high
quality employees
Kind and degree of ownership
The people of interest are the owner, upper
management, employees, customers, local
community.
Ambiguity
Unclear objectives for employees;
Management centralized with owner
Complexity
The task is made up of 2 to 3 components
based on projected desires. It is very
simple, but may require managerial change.
Novelty
The idea of running operations consistent
with other Coffee Waves to reduce costs;
The process would definitely cost the
company but we feel in the long run by
retaining management, this would reduce
costs
Timeline Can be implemented over a period of time.
History
We evaluated employees and managers of
Coffee Waves assessing their motivation,
ability, and salience. We minded key issues
and contrasts between management,
employees and the owner’s vision.
Through identifying these we discovered a
need for retention of quality employees,
postulated needs and expectations and are
currently focusing on implementation
Involvement of others
This is a decision to be solely implemented
by the owner.
Vision of desired future Management will most likely accept and
welcome the ideas. The issue really lies
with the owner and budgetary constraints.
The real question is does David have the
money and resources to take on such a
project. If so, how would he implement or
foresee such change and progress in his

company?
Source – Creative Approaches to Problem Solving , 3rd
Edition
It is important to view many different perspectives before gathering these factors, and to
be sure you are fully aware of the details of the four elements of appraising tasks to successfully
introduce these factors in your analysis. The group experienced that the factors are just an
introduction and the very beginning of appraising tasks. We had to really focus on comparing
and coordinating the factor and the four elements in order to successfully move on to the next
step.
By focusing on the factors, this helped the group become more flexible in our
conclusions and gave us the ability to adapt a susceptible environment as we move along through
stimulants and obstacles.
Table
Stimulants and Obstacles to a Creative Environment
Stimulants Obstacles
Restructure compensation package Budget limitations
Clearly defined job description Open style management
Nonmonetary compensation Owner willingness

Promotions Owner willingness/ narrow market for growth
Install a General Manager Contrasting views between staff
Employee input Change in processes and resources
Source – Creative Approaches to Problem Solving. 3rd
Addition
When exploring stimulants and obstacles we asked, “What is hindering a creative
employee environment at Coffee Waves?” From there, we focused on both extrinsic and
intrinsic elements. One stimulant would be restructuring the compensation package, however
budgetary limitations could be an obstacle. Another stimulant could be clearly defining the job
description of employees. An obstacle to this is that the set management style is highly informal
and may be difficult to change. A third stimulant would be to incorporate nonmonetary
compensation, but the obstacle would be willingness by the owner.
The opportunity for promotions into management could also serve as a stimulant,
however the willingness of the owner as well as the narrow market for growth could serve as an
obstacle. A fifth potential stimulant would be to install a General Manager, but an uneasy
reception by current managers and employees could be an obstacle. Last, if the employees were
allowed to offer input into the environment that may serve as a stimulant. However, an obstacle
to this could be the change in processes and resources.

Evolutionary
Change
Revolutionary
Change
Level of Change Required
Evolutionary vs. Revolutionary. During our research, what we found is that change at
Coffee Waves is evolutionary; very slow and methodical. This is evident with our interview of
the owner as well as interviews and surveys with management and employees. At this point,
from the ownership perspective, he's wanting steady, consistent growth in sales as well as overall
production and operations. However to achieve this, according to our study, there are
revolutionary changes he needs to incorporate to give employees the incentive to want to effect
his long-term goals.
Figure 9.2
A Spectrum of Change
Evolutionary Change Revolutionary Change
Detailed job descriptions Hire a General Manager
Expanding Coffee Waves brand Paid Vacation
New product offerings Matching 401k
Hiring p/t retirees Gain sharing
Source – Creative Approaches to problem solving, 3rd
Edition Pg. 202-203

During our research, what we found is that change at Coffee Waves is evolutionary; very
slow and methodical. This is evident with our interview of the owner as well as interviews and
surveys with management and employees. At this point, from the ownership perspective, he's
wanting steady, consistent growth in sales as well as overall production and operations. However
to achieve this, according to our study, there are revolutionary changes he needs to incorporate to
give employees the incentive to want to effect his long-term goals.
Figure 9.5
A Model to Help You Identify the Best Leverage Points
Edition Pg. 207
The Level of Capability Matrix is a tool that helps us realize where certain business
practices and ideas fall in reconciling activities in the ability to implement it and how important
Distractions
• Mobile Vending
Trailer
•Catering
Opportunities
•Create a General
Manager
Position
•Staff Meetings
Black Holes
•Expanding
productline
Challenges
•Mergingall 4
locations
•Cultural
Consistency
Hi
HiLo
Level of Importance
Level of Capability

it is.If a task is of low importance and the business is of high capability, it falls in the
'Distractions' category. Items in this category could distract management from more pressing
matters and can potentially be harmful to the business. Though the tasks we listed are viable
business ventures, we felt the focus must be on the physical coffee shop instead of outside
business ventures that could potentially divide staff and divert attention.
Coffee Waves only had one apparent item that falls under the 'Black Hole' category,
which is both of low importance and low capability, and that is expanding product lines. Coffee
Waves offers an enormous variety of products and the shop is literally running out of space to
store the ingredients and parts of these products. We felt that focusing on expanding product
lines even further would be of low importance because they offer so much already, and of low
capability due to spatial constraints.
Challenges presented very diverse answers, but the most prevalent were the merging of
all 4 local locations and keeping a consistent culture between the 4. Currently, the Port Aransas
store is removed from the three Corpus Christi locations, both staff and monetarily. Bendett is
the sole owner of the Port Aransas location and partial owner of the Corpus Christi locations. In
order to attain greater fluidity, the operational disconnect between these location must be
corrected.
'Opportunities' was a very easy section to write. Coffee Waves is highly capable of many
important things that would help them flourish. Of these, we felt that hiring a General Manager
and holding staff meetings would be the most beneficial if Bendett is wanting to foster a
consistent culture between his four coffee shops. This model proved to be very useful in
identifying the tasks and items that are prevalent and important for Coffee Waves to accomplish
or avoid or put off until a later time.

Environmental Summary
Plainly put, Coffee Waves is a unique venture where owner David Bendett seeks to invest
into his employees in order to establish grounds for culture expansion. His successes have been
consistent and bountiful. Coffee Waves is thriving because of the employees he develops.
David's ownership and management style is very vocal and full of praise and affirmation, but this
could lead to possible extrinsic and intrinsic outcomes.
To measure these, we explored various tools that measure stimulants and obstacles, and
we explored the data we collected. After this, we developed alternatives and solutions in order to
expand on the data. This environment was very open and conducive to the CPS process. Because
the ownership is so involved in the personal development of the employees, we feel that Bendett
would be very open to discuss the problem statements and solutions that we have developed in
this process.
III. Develop a Problem Statement using CPS techniques
Exploring Data.
Exploring data is a method of generating data by asking the 5 W’s. The group generated
this data by effectively coordinating these questions in interviews, Q And A’s, and employee
motivational evaluations. Through these methods we discovered that Coffee Waves is a
respected local business that values quality consistency and customer loyalty.
In the past Coffee waves has experienced customer tendencies towards expecting Coffee
Waves to be more like Starbucks. This is not the case, Coffee Waves values “quality over
quantity,” and this is instilled in their employees.

David is very vocal, which leads to discrepancies in how management view and
understand his vision. However, job descriptions are very ambiguous, which often lead to
confrontation and contrasting opinions between staff. Overall, employees are satisfied with the
quality of work, but expressed their desire for David to honor promise for raises and promotion.
Figure 3.10
Question for Exploring Data
Who? What? Where? When? Why? How?
Information David
Bendett
How to
retain high
quality
employees
Port
Aransas,
Corpus
Christi
Off season;
most
employees and
customers are
during peak
season
High turnover
and low
product
quality, out of
keeping with
company
goals
Interviews with
Owner and
managers,
evaluations and
survey of
employees
Impressions Prominent
local
company
with growth
potential
Common
problem -
high
turnover
Regional
problem
affecting
similar
companies
Year round;
peak as well as
off season
Typically, a
coffee shop
doesn't have
high career
potential
Observation,
survey,
interview, tacit
knowledge
Observations Owner,
Management,
employees,
customers
They need
to develop a
consistent
product
Coffee
Waves,
Port
Aransas
Anytime
they're open
Product
consistency
affects
customer
retention
Visit and
observe
Feelings Owner, loyal
customers
Frustrated Frontline
employees
and their
pay.
Ambiguous
employee job
description
Balancing
compensation
and sense of
worth
N/A
Questions David
Bendett
How to
reconcile
wages with
company
goals
Coffee
waves
Port
Arnasas
At any time. Obstacles to
the solution
How does CW
plan to
accomplish
long term
goals?
Edition Pg. 67

Opportunity Statement
a. Wouldn't it be nice if…
o Coffee Waves had an insurance plan?
o Coffee Waves could find more quality employees?
o Coffee Waves had a larger labor pool in Port Aransas?
o Coffee Waves had a General Manager?
o Coffee Waves could expand beyond coffee and gelato?
b. Wouldn't it be awful if…
o Coffee Waves never expanded beyond their current position?
o Coffee Waves didn't have enough employees?
o The espresso machine broke during peak season?
o Coffee Waves had to solely rely on high school students?
o The employees never earned beyond minimum wage?
The opportunity statement exercise was used to construct a decent start for a problem
statement. Based upon the knowledge obtained from the 5WH, we identified challenging issues,
or concerns within the organization and formulated statements with starters such as “wouldn’t it
be nice/ awful if…”
The exercise is considered a generating tool because we tried to come up with as many
possibilities, whether outrageous or foreseeable. Constructing opportunity statements helped lead
us to framing the problem in the Ladder of Abstraction, focusing and prioritizing, then making
comparisons through highlights in the effort to narrow down to a potential problem statement

Why? Why else?
H2make quality
and vision
consistent.
H2Stablize
workforce/lo
w turnover.
Why?
More consistance
in quality and
vision.
Initial Statement:
WIBNI Coffee Waves offered incentives to retain quality employees?
How?
Encourage
longevity in
managers &high
quality staff.
H2offercareer
oriented
incentives?
H2distribute
non-
monetary
benefits?
How? How else?
Ladderof Abstraction
Why else?
H2decrease
contrast between
owner's vision &
How else?
H2attract high
quality employees?
Figure 3.18
The Ladder of Abstraction
What the Ladder of Abstract did was allow us to focus our thinking by developing a
framework to view the issues facing Coffee Waves from a broader perspective. By constantly
asking the questions "How?" and "Why?," we were able to work from very broadly defined to
issues and produce more narrowly framed statements.

Figure 3.22
Highlighting
Highlighting
HITS
1. HM Coffee Waves instill vision in employees?
2. H2 establish long term employees?
3. IWWM Coffee Waves broaden their rewards for employees?
4. IWWM we change the culture at Coffee Waves?
5. H2 improve long term employee satisfaction?
6. H2 develop broader compensation package?
7. IWWM we identify career minded employees?
Relationship between Hits
CLUSTER 1
2. H2 establish long term employees?
5. H2 improve long term employee satisfaction?
7. IWWM we identify career minded employees?
CLUSTER 2
6. H2 develop a broader compensation package
3. IWWM Coffee Waves broaden their rewards for employees
HOT SPOTS
CLUSTER 1: Developing long term employees
CLUSTER 2: Adjusting compensation
Restatement ofHot Spots
Cluster 1: How can we retain long term employees?
Cluster 2: How can we provide career-like rewards?

The next tool we used was Highlights, which allowed us to categorize our options. As we
developed these categories, we began to see a common theme develop in within these categories
which led us to further group these themes into sub-categories. (Mind you - we had to work
through Highlighting several times before we finally arrived at a viable solution.) Once we
worked through our Highlights, this led us to our problem statement.
Problem Statement: What incentives can Coffee Waves offer to retain high quality employees?
IV. Apply CPS to generate alternatives
Brainwriting
Brainwriting Problem Statement: How can Coffee Waves retain high performing employees
by offering incentives?
After performing Highlighting and developing our Problem Statement, we were able to
use the Brainwriting tool to develop ideas for possible solutions. We started with three options
and developed them through four stages to see which option was the most viable. Our options of
gain sharing, commission based compensation, and conducting performance evaluations all
helped start the conversation of solving the Intrinsic and Extrinsic issues we were having in our
Motivational Model, where we developed our Problem Statement from.
Each solution was monetary-based, either in terms of raises or commission based upon
longevity or performance. In the end, we developed Option A in most detail. After
mathematically working out what a gain sharing plan would look like, we decided to continue to
further develop and expand our options. The Brainwriting model allowed us to share collective
ideas in a space that was beneficial to the problem solving process. From there, we were able to

develop alternatives and do an evaluation matrix on how well these options would work for a
solution.
Table
Brainwriting
ROW OPTION A OPTION B OPTION C
1
Gain
sharing
(starting at
7%)
Commission
based
compensation
Performance evaluations
2
Employees
at 6 months
- straight
bonus of
$200
Percentage of
shift volume
Focus on cultural climate
rather than compensation
3
Gain
sharing
every 6
months
long term
employees
and
managers
Quarterly
bonus on
revenues
based on
longevity.
(gain sharing)
Steady, seasonal pool of
potential employees
4 Increments of
0.05% of wages
gained in quarterly
bonus.
Pay higher hourly
wage
Gain sharing

SCAMPER
The next tool we incorporated was 'SCAMPER', which allowed us to organize six
concepts: Substitute, Combine, Adapt, Modify, Put to other uses, Eliminate, Rearrange, thus
stimulating more options. As a result, we developed the following:
Figure
SCAMPER
SCAMPER
Problem Statement: Howcan Coffee Waves retain high quality employees by offering incentives?
Substitute? How can Coffee Waves attract (instead of retain) high quality employees?
Combine? Retain the high quality employees, and have them train/mentor the moderate employees.
Adapt? Introduce performance evaluations to mete bonuses.
Magnify? The use of an incentives package.
Put others to use? Offer management internships to university students?
Eliminate? Perception of a "dead end" job.
Rearrange? The objectives of the organization to promote longevity.
This tool helped us not only generate more ideas, but also to search in new directions.
However, we needed to evaluate our ideas by using focusing tools. Focusing tools helped us
analyze and select those ideas that are more likely to be used as possible solutions to our problem

statement. The focusing tools we used were the Evaluation Matrix along with Advantages,
Limitations, Unique qualities, and Overcoming Limitations (ALUo).
The Evaluation Matrix helped us structure different approaches to evaluate options
against specific criteria. The options and criteria we selected for our Evaluation Matrix are
shown in the following table:
Table
Evaluation Matrix
Criteria
Options Viable Already doing
something
similar?
Cost effective? Easy to
implement?
Benefits
package
4 1 2 3
Commission
based
compensation
2 1 1 1
Gain-sharing 5 2 5 5
Foster a sense
of culture.
5 4 5 4
Clearly defined
job descriptions
5 2 5 5
Rating Scale: 5 - positive; 3 - Neutral; 1- Negative

The options were based on the best selection of the ideas we obtained from the generation
of ideas section. Based on the options, we came with the best criteria, so that our options would
be evaluated carefully.
For the criteria 'Viable,' the option 'Benefits Package' was rated a 4 because recent
legislation has nearly forced business owners to offer such benefits as healthcare. The option of
offering commission based compensation was rated a 2 because Coffee Waves sees a seasonal
fluctuation in clientele, which could greatly diminish the income of employees.
For the option of 'Gain sharing', we listed that as a 5 in viability because the notion of a
quarterly, biannual, or annual payout for solid performance would highly contribute as an
incentive for employees. The option 'Foster a sense of culture' was given a 5 for viability because
it's the most easy, non-monetary incentive to offer, while the option of 'Clearly defining job
descriptions' was also listed as a 5.
For the criteria 'Already Doing Something Similar,' the option 'Benefits Package' was
listed as a 1 because Coffee Waves has nothing like this currently in place, and from our
interview with the owner, this isn't even on the radar. For the option 'Commission based
compensation', we rated that a 1, because they are currently paying employees hourly.
We rated the option 'Gain sharing' a 2 because though there are bonuses based on
performance, it's not on this scale. For the option 'Foster a Sense of Culture, we rated that a 4
because Bendett has done a very good job of doing this, and further alterations with the culture
of Coffee Waves would be simple to introduce. 'Clearly Defined Job Descriptions' is a 2 as an
option because as a rule, Bendett has kept job descriptions vague on purpose.

For the criteria "Cost Effectiveness', the 'Benefits Package' option was rated a 2, as it will
be very costly out of pocket for the owner. The option of 'Commission Based Compensation',
was rated a 1 due to the seasonal nature of the business. 'Gain sharing' as an option is extremely
cost effective to implement and was rated a 5, as was the option of 'Fostering a Sense of Culture'
and 'Clearly Defining Job Descriptions.'
For the criteria "Easy to Implement', 'Benefits Package' was rated a 3, as it will soon not
be an option, 'Commission Based Compensation' was rated 1, and 'Gain sharing' was rated a 5
because there's no upfront cost associated with its implementation. 'Fostering a Sense of Culture'
was rated a 4 for ease of implementation, while 'Clearly Defining Job Descriptions' was rated a
5.
Based upon an analysis of each option given against each criteria, the options which
received the highest scores are 'Clearly Defining Job Descriptions', 'Fostering a Sense of
Culture', and 'Gain sharing'. Though having clearly defined job descriptions and fostering a
greater sense of culture within the company may lead to better performance, that's not say that
those will be incentives which motivate better performance. The only criteria we evaluated that
singularly meets that need is gain sharing.

V. Apply CPS to Focus toward a solution
Table
ALUo for the Gain sharing
Advantages 1) Meets Employee Needs
2) Promotes Longevity
3) Builds a sense of 'career' as opposed to a 'job'
Limitations 1) Budgetary constraints
2) Additional Administrative Duties
3) Equitable distribution
Unique Qualities Matches national brand competitor's offerings at a local level
Overcoming Limitations 1) Institute employee performance evaluations
2) Create a General Manager position
3)
This analysis measured the various Advantages, Limitations, Unique Qualities, and offers
options for Overcoming Limitations. We identified the 'Advantage' of gain sharing to meet
employee needs and promote longevity by offering more and more to the employee, the longer
they stayed. The longer they stay employed with Coffee Waves, the more often they work, and
their good performance translates directly to a monetary compensation. This fosters a sense of a
career as opposed to a job.
Essentially, the employee’s earnings are uncapped depending on how much effort they
put forth. There are limitations as budgetary constraints and additional need for administrative
duties, running the risk of the perception of inequitable distribution if an employee was denied
their quarterly percentage increase if the failed meet performance qualifications.
The 'Unique Qualities' that gain sharing offers is that it matches the offerings of the
national brand coffee shop chains at a local level. Offering a corporate compensation strategy in
a small local business is revolutionary. To overcome limitations and make this solution

successful, Coffee Waves must institute fair and balanced employee evaluations and must create
a General Manager position to provide the administrative support for this compensation strategy.
With the ALUo, we identified the key elements that would make this plan successful.
From here, we can do a Cost-Benefit Analysis to see if this plan is feasible to institute
within the current budgetary constraints.
Table
Cost/Benefit Analysis
Cost Benefit Analysis
Gain sharing (starting at 7%)
Employees at 6 months - straight bonus of $200
Gain sharing every 3 months long term
employees and managers.
Gain sharing of .5% on a quarterly basis.
We chose Gain sharing as an incentive because we needed to find an Extrinsic reward
that would promote both Salience and Equity. Gain sharing is essentially a bonus structure that
increases the bonus based on longevity and performance. The model we drew up starts the
employee at an hourly wage of $8.00, with bonus payout on a quarterly basis. After six months
of employment, the employee will have an employee evaluation, and based upon a good
performance review, the employee will receive a straight $200.00 bonus.
From six months forward, the employee will receive a bonus based upon wages, with the
initial bonus at seven percent of the employees’ wages for that quarter. For each good

performance evaluation, the employee will receive an increase of their bonus in 0.5%
increments. Essentially, each year, their bonus has the potential to increase 2% if they are
performing well.
Along with this increase, the owner has the discretion to raise the employee’s wage so
that the employee will have a higher hourly pay as well as a higher bonus. The bonus structure
will be capped at 15% of the employee’s salary, which will take at least 5 years for the employee
to accrue, depending upon how well the employee performs. This system would be a
revolutionary change that would contractually obligate the management and ownership to make
good on their promises of advancement and pay raises.
Direct Costs: We figure that the average employee works 32 hours per week. There are
13 weeks in each quarter, so each employee will work on average 375-425 hours per quarter. If
the employees earn $8 per hour, this extends out to an average of $3,000 to $3,400. The initial
bonus would be $200, which equates to a $0.50 raise on the 6 month mark. After that, the
employee will accrue an average of $0.45 hourly wage raise each quarter due to the bonus
structure.

The following graphic explains the structure of the proposed Gain sharing:
Hourly Wage $8.00
Average Hours 400
Hypothetical
Average
Quarterly
Earnings
3,200.00$
Quarter Bonus Amount
Gainsharing
Percentage
Years
Employed
Annual
Bonus
Amount
6 month mark 200.00$
Q3 224.00$ 7.0%
Q4 240.00$ 7.5%
Q1 256.00$ 8.0%
Q2 272.00$ 8.5%
Q3 288.00$ 9.0%
Q4 304.00$ 9.5%
Q1 320.00$ 10.0%
Q2 336.00$ 10.5%
Q3 352.00$ 11.0%
Q4 368.00$ 11.5%
Q1 384.00$ 12.0%
Q2 400.00$ 12.5%
Q3 416.00$ 13.0%
Q4 432.00$ 13.5%
Q1 448.00$ 14.0%
Q2 464.00$ 14.5%
Q3 480.00$ 15.0%
Q4 480.00$ 15.0%
Q1 480.00$ 15.0%
Q2 480.00$ 15.0%
Q3 480.00$ 15.0%
Q4 480.00$ 15.0%
Q1 480.00$ 15.0%
Q2 480.00$ 15.0%
Q3 480.00$ 15.0%
Q4 480.00$ 15.0%
Year 4
Year 5
Year 6
Year 7
664.00$
1,120.00$
1,376.00$
1,632.00$
1,872.00$
1,920.00$
1,920.00$
Year 1
Year 2
Year 3

Longevity and good performance is strongly encouraged by this plan. The above graphic
relates the gain sharing earned if the employee had consistent good performance evaluations and
the employee did not receive a wage increase. The annual cost for the average employee earning
an hourly wage of $8.00 essentially amounts to paying them an extra paycheck every quarter.
The consistency of this plan is more preferable to employees because they receive
documented and professional performance evaluations. When they receive direct monetary
extrinsic rewards based upon their employee performance evaluations, they are likely to perform
better and have more equity in the business. If management deems it necessary, they can increase
wages as they see fit. Each raise of $1 equates to a 5.6% increase of the amount of the
employee’s bonus structure. If Coffee Waves employs on average of 10 employees per quarter,
the annual costs would extend out to roughly $10,000 to $15,000.
This plan would be good to implement in the Fourth Quarter of a fiscal year when
business is slow in Port Aransas and working hours are cut. Employees earn their bonuses based
upon how many hours they work and how good their performance is.

Conclusion
By utilizing the theories of motivation as well as Creative Problem Solving techniques,
we were able to examine the outputs of the employees of Coffee Waves Port Aransas and then
make assessments as how to alter these outputs by adjusting the inputs. This included surveys,
interviews, and observations of the owner, management, and employees.
Further, we created a problem statement, generated alternatives by the use of focusing
tools to analyze the most feasible solution to address Coffee Waves' needs. After doing a
cost/benefit analysis of our solution, we concluded that offering periodic gain sharing would be
the best solution for our problem statement "What incentives can Coffee Waves offer to retain
high quality employees?"
Gain sharing would catapult Coffee Waves from being perceived as a job and more as a
career, and would provide performance based incentives to top employees. This would be easy to
implement because by making simple changes in pay structure, it would give stable employees a
sense of stability which would facilitate retention.

References
Cameron, K. S., & Whetten, D. A. (2013). Motivating Others. In S. R. Kursh, T. K. Lant, K. D.
Majeske, J. M. Olver, & R. Plant (Ed.), Business Resources (pp. 1-25). Boston, MA:
Pearson Learning Solutions.
(Cameron, 2013, p. xx-xx)
Isaksen, S. G., Stead-Dorval, K. B., & Treffinger, D. J. (2011). Creative approaches to problem
solving: A framework for innovation and change(3rd ed.). Los Angeles: SAGE.
(Isaksen, Stead-Dorval, & Treffinger, 2011, p.xx-xx)
Lazerow, R. (2012, May 17). The Advisory Board Company - Designing effective gainsharing
models. Retrieved 31, 2014, from http://www.advisory.com/Research/Health-Care-
Advisory-Board/Blogs/Toward-Accountable-Payment/2012/05/Designing-Effective-
Gainsharing-Models
(Lazerow, 2012, p. xx-xx)
Masternak & Associates (n.d.). Gainsharing Consulting: Gainsharing Versus Profit Sharing -
Masternak & Associates. Retrieved March 31, 2014, from
http://www.masternak.com/gainsharing-versus-profitsharing.asp
Root III, G. N., & Demand Media (2014). Incentive Pay for Job Performance | Chron.com.
Retrieved March 31, 2014, from http://smallbusiness.chron.com/incentive-pay-job-
performance-10859.html
In Text - (Root III & Demand Media, 2014, p. xx-xx)

Veronica, & LinkedIn Corporation © 2014RSS Feed (n.d.). Tips on how to handle resistance to
change in small businesses -part 1. Retrieved March 31, 2014, from
http://www.slideshare.net/VBroomes/managing-resistance-to-change-for-business-
success-15-tips-part-1
(Veronica & LinkedIn Corporation © 2014RSS Feed, n.d., p. xx-xx)

CPS Project 2 Final (Formatted Draft 1)

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