Essay by hrbmiracleA-, May 2004

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Part 1CASE

V. L.

V.L. is a chain of men's retail clothing stores located throughout the province of Quebec, Canada. Two years ago, the company introduced new incentive system for both store managers and sales employees.


Reinforcement theory concentrates on the environment and its consequences on an individual instead of needs or why people make choices.(Harris, Chris, Kleiner, Brian H 1993)Reinforces include positive, negative, extinction or punishment.


Positive reinforcement involves providing a pleasant, rewarding consequence to encourage a desired behavior. Employees will find different rewards encouraging, so managers must monitor the effects of rewards.(Pamela Mathews,2004,P139) According to the case of V.L., Sales employees are paid a fixed salary plus a commission based on the percentage of sales credited to that employee over the pay period. The commission represents about 30 percent of a typical pay and is intended to encourage employees to actively serve customers and to increase sales volume.

Sales employees tended to stand near the store entrance waiting for customers and would occasionally argue over "ownership" of the customers. Managers were concerned that this aggressive behavior intimated some customers. It also tended to leave some parts of the store unattended by staff. Many managers were also concerned about inventory duties. Previously, sales staff would share responsibility for restocking inventory and completing re-order forms. Under the new compensation system, however, few employees were willing to do these essential tasks. On several occasions, stores experienced stock shortages because merchandise was not stocked or re-order forms were not completed in a timely manner. Potential sales suffered from empty shelves when plenty of merchandise was in the back storeroom or at the warehouse. The company's new automatic inventory system could reduce some of these problems, but employees must still stock shelves and assist in order aspects...