Why Sun Ray Failed To Shine
This essay recounts the concept of staff retention as an important aspect of management. The essay presents the background of the importance of staff retention and the key factors that are integral in achieving staff retention. The essay notes that transformation in the financial and accounting job market has led to more open vacancies than people are willing to fill. Organizations suffer losses when employees leave their jobs. Staff retention considers different measures taken so that an employee stays in an organization for as long as possible. Some strategies for staff retention include a reasonable and competitive salary; other remunerations are an obvious way to entice and retain skilled personnel. In addition, a positive and supportive environment and flexibility to balance work and other personal demands are also fundamental factors in staff retention.
This essay illustrates the concept using the case study of the failure of Sun Ray. Sun Ray failed because it made not as much sales as Sun Microsystems had projected during the first year of operations (100,000 pcs); it was projected to sell one million Sun Ray during the second year.. Such factors as the inappropriate merger between the JavaStation team and the Sun Ray team led to the failure of the product.
The essay uses the Australia and New Zealand Banking Group Limited (ANZ) as an example of best practices in staff retention. The bank has succeeded in the concept through enactment of its breakout concept that aimed at transforming corporate culture of the organization.
Table of Contents
Abstract/Executive Summary. 2
Part A: Expectancy Theory of Motivation. 5
Part B: Case Study: Why Sun Ray Failed to Shine. 6
Challenges of Sun Ray. 7
Part C: Employee Retention Strategies and Case Study of Successful Staff Retention (ANZ)9
Successful Company Case Study (ANZ)10
Employee retention is an urgent issue in management. The concept refers to the methods used by the management to ensure that workers remain in the firm for an optimum time. Staff retention strategies boost the morale of workers so that they remain with the organization for as long as possible while they contribute to the company`s success. Organizations must be determined to ensure progress and development of staff in their current jobs and for them to enjoy their tasks.
Staff retention has become a fundamental concern for organizations in the contemporary job market. Workers have a tendency of leaving their jobs after being provided with training to move to other organizations for advanced opportunities. Such prospects may include a competitive salary, flexible schedule, better work environment, and career development prospects (Nancy et al 1982).
Staff retention starts at the top of an organization`s management. Sourcing, hiring and retaining of personnel are the roles of the organization’s management board and executive team. Employment and retention of good employees demands attentive, formal and informal procedures and guidelines that make retention a leading organizational product. Administrators need to appreciate employees to keep them on board, reduce employee turnover and improve the productivity of the organization (Daniel 2010).
The case study of Sun Ray indicates the detrimental effects of failure in employee retention. An inappropriate merger of the JavaStation and Sun Ray teams led to the catastrophic failure of the Sun Ray product. The Australia and New Zealand Banking Group Limited (ANZ) is a good example of the best practices of staff retention. The banks have succeeded in the concept through enactment of their breakout concept that aimed at transforming corporate culture of the organization.
Part A Expectancy Theory of Motivation
The theory relating to staff retention management is the expectancy theory of motivation. Victor Vroom created the theory in 1964. The theory explains the behavioral process of why individuals choose one behavioral option over another and according to the theory a person will decide to act in a certain way because they are motivated due to what they expect the result of that selected behavior will be. The theory explains that employee’s inspiration is a result of how much an employee is motivated. It also depends on the evaluation of the probability that the employee’s effort will result to expected reward. The theory also illustrates issues of relationship between performance and effort, reward and performance and reward and personal goals. The theory is necessary for employee retention because it explains that employees must attain maximum satisfaction to decide to remain in an organization. It also emphasizes reward and benefits as a way of motivations and employee satisfaction. The theory implies that organizations should reward employees to improve their motivational levels. The limitation of the theory is that it seems to be unrealistic because only a few employees notice a strong relationship between performance and payments (MSG 2008).
Organizational or corporate culture is the values and peculiar principles that add value to the social and psychological setting of an organization. It is the way in which the organization conducts its business. It includes expectations, philosophy, and employees` conduct. Organizational culture is essential because it affects productivity and performance of the organization. It also provides guidelines of operation to employees, clients. It also affects the opinion of the society about the organization and hence its marketing practices and general success are dependent on corporate culture. Organizational culture can be shaped through streamlining the rules and regulations of the organization, setting values and philosophies, enacting quality and safety measures and managing the organization in accordance with the main objectives of the organization (Finger 2005).
Organizational culture is measured through the Denison Organizational Culture Survey and the Denison Leadership Survey. These methods identify broad characteristics of organizational culture such as mission, involvement, adaptability, and consistency (Finger 2005).
Part B: Case Study: Why Sun Ray Failed to Shine
Sun Ray was a simple, cost-effective tool that did not need desktop administration. Sun Ray was based on a network, a display and keyboard, with processes running on a server in a different setting. The idea of Sun Ray desktop concept was critical in transformation to JavaStation, diskless Java-only desktops.
Sun Microsystems employed a team of 20 people to work with more than 200 people when designing Sun Ray. It was a risky venture putting into consideration a lot of employees who took part in the design of JavaStation that was not successful.
The device brought a new meaning of desktop computing. It cost less than half the cost of a regular personal computer and offered an alternate solution to the Microsoft dominant technology.
The target of Sun Ray was to reach out to small organizations in need of cheap, and efficient computing technology. Sun Ray network system provided a possibility for a user to go from one Sun Ray to another and continue their work without closing any programs. The Sun Ray technology led to automatic installation of new software updates. In case of a stolen Sun Ray, the thief would not be able to access the user`s data.
Va¨likangas and Moldenhauer-Salazar (2008) note that the Sun Rays project failed the company failed to sell 100,000 Sun Rays within the first year of operation as it had been projected by Sun Microsystems , and one million Sun Rays within the second year. (Va¨likangas et al 2009).
Sun Microsystems started to suspend employees on the eve of the emergence of dot-com technology in 2001. The company decreased the number of employees from 250 to 22. The Sun Ray product survived in the market only because Sun Microsystems` employees used it widely (Va¨likangas et al. 2009).
Challenges of Sun Ray
The challenges that led to the failure of Sun Ray can be traced to the glitches of its predecessor, the JavaStation. The failure of the JavaStation product was the main cause of the Sun Ray`s disaster. (Va¨likangas et al 2009).
The challenges of Sun Ray included inappropriate merger, employee suspension, cancellation of JavaStation a month before the launch of Sun Ray, poor employees` relations, and poor employee motivation. The organization’s use of 20 employees only who had been developing the JavaStation product was the main mistake of the organization. The organization integrated the JavaStation team with the Sun Ray team as a strategy of suspending the whole JavaStation team. This strategy did not work because Sun Ray abruptly received surplus employees and expertise. The organization noticed about the cancellation of the JavaStation a month before the launch of the Sun Ray product.
The fact that two teams were united decreased aspirations of the JavaStation team. This made the Sun Ray team unmotivated when designing the product. Two teams were united at an inappropriate time. It was a critical phase of the product design and the teams had been aggressive competitors before. In addition, Sun Ray had not yet recovered from the trauma of the failure of JavaStation.
The fact that the JavaStation and Sun Ray teams were united resulted in the Sun Ray team losing authority over the project at the eve of the product launch. Several executive officers led to the Sun Ray team’s sensation of not being in charge. According to Va¨likangas and Moldenhauer-Salazar (2009), Sun Ray team was still upset due to the failure of the JavaStation product.
Part C: Strategies for Staff Retention and Case Study of Successful Staff Retention (ANZ)
In 2006, Messmer noted that a reasonable and competitive salary and other remunerations are obvious ways to entice and retain top employees in a company. Remunerations of financial professionals are increasing gradually in response to demand (Messmer 2006).
Employees want to work in a positive and supportive environment. Most employees consider this feature an essential parameter when assessing corporations. All organizations should make employee feel appreciated and involved in the work process (Scott 2013).
Majority of workers are attracted to organizations where there is an opportunity for constant learning. Therefore, many organizations support career growth opportunities and increase the number of professional trainings (Rodnay 2010). Some organizations offer salary increments and bonuses when employees attain considerable results, such as conclusion of projects or receipt of a new accreditation (Ludwig 2013).
A flexible work schedule is also an influential factor in employee retention. Employees prefer a setting where they have a certain degree of control over when and where they work (Messmer 2006).
Building a setting of trust with employees, clients, shareholders and the community and having a culture of open communication where employees feel comfortable to raise their concerns to the management are also important strategies to retain employee (Caracoglia 2013).
Cook (2008) notes that measurement of employee retention can be done through the use of employee turnover. It is an expression of the number of employees leaving the organization over the total number of employees in the organization. Multiplication of a value received by one hundred provides the percentage of the organization`s employee turnover (Cook 2008)
Successful Company Case Study (ANZ)
One company that has successfully dealt with the issue of employee retention is the Australia and New Zealand Banking Group Limited (ANZ). It is the third largest bank by market capitalization in Australia. Australian activities compromise most of the transactions of ANZ’s business. The dominant transactions relate to commercial and retail banking (McHale 2000).
Their methodology included the use of a “breakout” program. This program advocates for a change of ANZâ€©‘from insideâ€©out’. The emphasisâ€©ofâ€©the ‘Breakout’â€©initiative wasâ€©toâ€©investâ€©in organization`s employee and empower them to becomeâ€©moreâ€©awareâ€©ofâ€©themselvesâ€©and theirâ€©impactâ€©onâ€©others. It also sought to giveâ€©themâ€©toolsâ€©toâ€©enhanceâ€©theirâ€©interactionsâ€©andâ€©relationships. ANZ transformation was through collective personal changesâ€©ofâ€©theâ€©individualsâ€©withinâ€©theâ€©organization and a positive shift inâ€©theirâ€©mindsetsâ€©andâ€©actions.
The Breakout workshops are based on fundamental principles such as development of self-awareness and development of management skills. The ANZ implemented non-dictatorial trainings around the organization. Inâ€©aâ€©periodâ€©of overâ€©6â€©years, 26,000â€©employees of ANZ of different positions took partâ€©inâ€©theâ€©training program atâ€©aâ€©totalâ€©costâ€©ofâ€©$18m (McHale 2000).
There are flexibleâ€©workingâ€©provisions for employees; for example, ANZ doubled parental leave to 12 weeks of pay, with no minimum serviceâ€©period to qualify, the company`s policy offers 76 hours leave to provide care to family members. Other options include: â€©lifestyleâ€©leave providing upâ€©toâ€©4â€©weeks of unpaid leave, job sharing, employment benefits and flexible long service leave provision. ANZ also offers salary packaging choices, share allocation, and 1 day of paid volunteer per year (McHale 2000).
The metrics they use to evaluate their success include statistics of profit margins made before and after the breakout program. Before the breakout program in 1999, ANZ recorded a profitâ€©ofâ€©$1.5â€©M after taxation. However, following the breakout program, the organization recorded an after-tax profit of $4.5â€©billion in 2010. This was an influential indicator of success of the program (McHale, 2000). In addition to profit measures, ANZ uses statistics indicators of share price, cost to income ratio, and employee satisfaction ratio as metrics of assessing the success of the initiative (McHale 2000).
In conclusion, employee retention is an urgent issue in management. The evolving dynamics in the financial and accounting job market have increased the need to retain employees. There is a surplus in the provision of financial professional jobs. This creates an utmost priority for organizations to retain their accounting and financial management employees. Retention of employees in an organization has become a difficult task. From the case study review of the failure of Sun Rays, it is evident that the importance of employee retention cannot be underrated. The organization’s use of 20 employees who had been developing unsuccessful JavaStation product was a significant gamble for the organization. The organization integrated the JavaStation team with the Sun Ray team as a strategy of suspending the whole JavaStation team. This strategy did not work because Sun Ray abruptly received a surplus of employees and expertise. This transformation underlines the eventual failure of Sun Ray. The case studies reviewed reveal different strategies of ensuring employee retention. The following strategies can be used: employee rewarding, improvement of communication channels, employee training, and appraisal. These strategies encourage the morale of the employees, as a result productivity of the organization will be improved and employees will remain in the organization. The study has reviewed ANZ as one of successful examples of implementation of employee retention strategies. ANZ uses strategies such as flexible working hours, appreciation of employee welfare, holiday and allowance offers and improvement of communication between employees, management and clients. ANZ transformed employee retention strategy through the breakout initiative. It uses profits, price shares and employee turnover as measures of indicating the success of the initiative. In a nutshell, these case studies reveal the importance of employee retention in an organization.
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