Essays on Application of Equity Theory at Bain & Company Case Study

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The paper "Application of Equity Theory at Bain & Company" is an outstanding example of a management case study.   Equity theory is based on the principle of balance at the workplace. It’ s argued that an employee’ s motivation is directly correlated with his perceptions towards equity and justice as well as fairness as demonstrated by the organisation management. It is very important to argue that this theory can be applicable in many cases including the Bain and Company. As the recession continues to hit and affect many of the business organisations, equity theory can be applied at the workplace to change the perception the employees have towards the management and thereby engage positively on constructive issues of the business (Smith 2008, pp.

171). Bain and Company are considering various options under this era of recession where downsizing is one of them. In addition, change of reward criteria and payment of bonuses is being used to ensure that top employees are retained. Under the equity theory, it is assumed that employees are very cautious of what they get in an organisation in comparison to the peers in the same industry.

Bain and Co. are expected to review and determine the relative importance of the equity theory to its situation. According to Gill and Stone (2010, pp. 346), equity theory workplace is perceived by many employees a shepherd of the employee’ s rights. This is because it addresses the issues of justice, fairness and equity. With this regard, therefore, this theory can be applied to different perspectives. First, the company is lacking a good policy on how employees should be recruited. Equity theory demands that fairness be demonstrated to all potential employees of the company.

For instance, the company’ s move to go for financial consultants who previously have worked with the financial firms but all now stranded and the plan to go for MBA students, the company, is clearly demonstrating how equal opportunity is denied all potential employees. In addition, this theory presents the relative importance of taking certain moves which are aimed at reducing the number of employees working for the company amid hard economic times. Downsizing or employee cut-down on many occasions is seen as a strategy to help the company survive during poor economic performance.

As an option, this theory will inform the company on the need to work on policy that does not discriminate among individuals as some are likely to be sent home following the poor performance of the business. Further, employee wages, benefits and rewards, are considered some of the management issues that cause conflicts between the employees and their employers. This is because of the assumed imbalance that exists between different companies operating within the same industry according to Parrish (2008, pp.

10). The Bain and Co. can engage this theory to come up with a policy that seeks to address the rates of its employees with those of peers in other companies. For instance, while setting employee targets for bonuses, it’ s particularly important to set realistic targets which clearly compare with those of the other companies that operate in the same industry. This is will enable the company to assure the employees of their efforts by setting favourable work policy which is not isolation from the rest.

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