How did this happen? This is how:<br />Inappropriate mortgages sold by mortgage lenders<br />Laxity in control measures over the sale of mortgages<br />Increased default caused and brought house prices crashing and the housing boom came to an end<br />Group Name<br />
Suzanne Malcolm- Case Study of how People Management is affected by the Credit Crunch <br />This case study will look into two important concepts related to people <br />management which are:<br />Argyris’s Psychological Contract – Term first coined by Argyris (1960) to refer to employer and employee expectations of the employment relationship, i.e. mutual obligations, values, expectations and aspirations that operate over and above the formal contract of employment<br />Frederick Herzberg’s motivational theory – Herzberg was a clinical psychologist and is regarded as one of the great original thinkers in management and motivational theory.<br />
Suzanne Malcolm- Case Study of how People Management is affected by the Credit Crunch <br />Suzanne Malcolm- Sr. Recruitment Consultant since last 10yrs at ABC Ltd. specialising in Retail Recruitment<br />Reporting to Director – Mr. David Jones and was happy and satisfied with her job . Had developed good interpersonal relationships and shared a positive psychological contract with the Company.<br />Herzberg’s Motivators<br />Organisational Commitment<br />Suzanne<br />David Jones(ABC LTD)<br />Psychological Contract<br />
Suzanne Malcolm- Case Study of how People Management is affected by the Credit Crunch <br />Effects of change on Suzanne:<br /><ul><li>Business targets go up by 25%
Employment terms changed to Contractual Employee from permanent Employee
Suzanne was unhappy and the only explanation she got from her boss was that it was all due to the recession and tight financial conditions of the company</li></ul>CREDIT CRUNCH<br />
Suzanne Malcolm- Case Study of how People Management is affected by the Credit Crunch <br />Herzberg’s Motivators<br />Psychological<br />Contract<br />
Frederick Taylor : Theory of Motivation<br />Mr. Ryan Taylor, a senior investment banker working for ABM Bank Plc. UK, since last 15 years. Perceptibly earning good amount of salary. <br />Eventually due to credit crunch and government impositions, his bonus was reduced by 60%. <br />This uninspired and de-motivated Mr. Taylor, though 40,000 p.a. is still a big sum of money to be received as bonus.<br />
Elton Mayo : Theory of Motivation<br /><ul><li>Jason Knoll, MD of Shell earning £1.5 million bonus p.a.
Recently made a statement in the financial times that rise or decline in the bonus will not affect his performances, as bonus is not an inspirational factor for him.
Hence, due to credit crunch the organisations must now switch to non financial methods of motivations and incentives.</li></li></ul><li>Non-monetary methods of motivation during recession.<br />
SOCIAL ISSUES<br />- Who is Affected & How?<br />Job Losses, Health<br />Lifestyles; spending,<br />Borrowing & Eating <br />Habits.<br />Pension schemes, Investments, crime<br />Group Name<br />
CASE STUDY<br />37-year old Phil a worker in the construction industry<br />Secure employment. <br />Good qualifications & experience<br />A lovely house & girlfriend<br />Redundancy<br />No job, lost home, girlfriend left, lifestyle change<br />World crumpling down<br />
The Role of AnimalSpirits<br /><ul><li>Never understand important economic & financial event.
Confront the fact, causes largely mental in nature.
What had people been thinking? Why no notice till real events upon us?
The simple answer. Re –assurance by an economic theory, safe ok
Conclusion<br />I brought chaos and destruction to New York's financial district...<br />I hear you get a bonus for that...<br />Depending on our pleasant and unpleasant experiences, we can keep on speculating about the whole crunch. In short, we Pinnacle conclude that people issues caused this crisis and that we all need to be ever more responsible towards our actions in the economy that we are a part of, otherwise this monster of capitalism which was overfed by the financial terrorists will give constant blows of cyclical ups and downs to all of us... <br />When the next one happens,<br />Wait and Watch…!!!<br />Thank you all for listening <br />