Please read the case below and answer the following questions. Be sure to clearly identify your answer to each question.

1) What is the OB problem in this case

2) What is (are) the cause(s) of the problem

3) Discuss the theory surrounding the cause(s)

4) Suggest practical, theory based interventions that may help solve the problem.

Bella's is a full service day spa and hair salon featuring a wide variety of spa treatments. Exclusive lines of hair and body products are also available. Bella's also features a retail department which specializes in unique custom jewelry.Bella's flagship store and headquarters are in a city with a population of approximately 250,000 people in the southern United States.It also has spas/salons in four other smaller cities (all with populations over 40,000) in the same state.Last year, Bella averaged approximately 25 employees per store; annual sales last year were approximately $3,000,000, a decrease of 12% from the previous year.The company lost money last year for the first time since its initial year of operation. The success and growth of Bella's has far exceeded all Illa Fitzgerald's (the founder and owner of the business) original expectations.

Kris Jenkins is the recently hired general manager of Bella's Incorporated, having taken over from the previous general manager, Lynne, when Lynne decided to return to school.Kris also serves as the store manager of its flagship location. Within her store, a Retail Manager and a Service Manger reports directly to Kris.Additionally, the Store Managers at each of the other four Bella locations report directly to Kris.

Within each store, individual store managers were the only employees serving in a supervisory position with each being responsible for all daily operational issues of his/her salon. All other responsibilities/decisions for individual locations are Kris's. This includes all purchasing, marketing, financial, and human resource decisions. Individual store managers did have the opportunity to offer informal input into hiring decisions for his/her store. Bella's offered a benefits package that was fairly standard for an organization of its size.

Kris Jenkins started her job as the new general manager of Bella's a month ago today. Her ultimate goal was to own her own salonbut she did not feel that she was yet prepared either financially or from an experience standpoint. Therefore she was hoping to make a career move that would enable her to have direct input regarding all top management decisions of a salon. Plus, her career goals were almost identical to those of Bella's owner 12 years ago.Illa had achieved exactly what Kris aspired to achieve.Kris had discovered a new role model. What could be better?The opportunity looked ideal.

As Kris sat at her desk this morning, things didn't appear nearly as ideal. She kept replaying three events in her mind:

1.After the offer but before accepting the position, Kris had spent a weekend with the previous general manager of ten years, Lynne Gibson (who now served as a consultant to the organization), discussing a wide array of topics regarding the company.Bella's numbers had deteriorated dramatically in the past year.Profits were down; absenteeismwas up; turnover, while not dramatic, was higher than it had been in the past five years. And while no formal performance appraisals had been done in the past year, Lynne provided her assessment of the performance of all Bella's key people. It was clear that Lynne felt each was performing significantly below their capabilities, significantly below previous levels of performance. Following these discussions, a number of things stood out to Kris. First of all, Lynne was very reluctant to criticize Bella's employees.But between promises of secrecy and reading between the lines, it became evident that Lynne had serious concerns - and it seemed to Kris that Lynne's biggest fear centered on Illa. As their discussions continued, it became quite clear that Lynne doubted Illa's ability to provide Kris the autonomy needed to effectively manage Bella's. This appeared to stem primarily from two things: 1. Illa's unexpected interference with only limited information about the issues or problems, and 2. Illa's tendency to regularly monopolize the manager's time on trivial or personal matters thus keeping the manager from focusing on the needs of the salon.

2.After the weekend with Lynnebut again before accepting the position--Kris spent three days at the Bella's.She had stayed at the spa from opening to closing to visit with all the employees. While the conversations had been pleasant, it seemed pretty apparent that many, if not all, seemed reluctant to be totally honest. Though none had directly denigrated the company or the owner, body language and incomplete or evasive answers had concerned Kris at the time. She couldn't help but worry that the majority of Bella's employees simply did not feel good about their jobs or the company.

3.Though she had spent a great deal of time with Illa, the afternoon that she formally accepted the job was critical in Kris's ultimate decision to accept the position. Due to numerous concerns that became evident while spending time with Lynne and the employees, Kris was leaning heavily toward declining the job offer.However, after respectfully discussing these concerns with Illa, Kris began to change her mind. Illa addressed each issue giving the impression that she recognized the problem and was willing do whatever it took to correct and improve both company and employee performanceincluding stepping away and giving Kris autonomy to make all operational decisions at Bella's.Illa was very persuasive, and Kris decided to reconsider her decision to decline the position. At the end of the day, she told Illa she would take the position. Kris was excitedshe knew this would be a wonderful career movebut also worried. Could she really turn Bella's around?And would she have the freedom to do so?

"Enough reflection," Kris said out loud. "It's time to get busy." She had in front of her the results of the employee survey she had conducted over the past two weeks (see the tables below). It was similar to the survey that had been used in her previous job. Kris had been involved in implementing changes at her previous salon based on results of these surveys changes that had been quite effective in terms of improving outcomes. She was optimistic that some insights in these two areas might lead to the same thing occurring at Bella's. On the promise of anonymity, no names were attached to any surveys; however, the aggregate outcomes, while there were some positives, were quite troubling.

Job Satisfaction (Strongly Disagree=1, Strongly Agree=7)	Salon Mangers Mean Score	Stylists Mean Score	Spa Service (Nail, etc.) Mean Score
I am very satisfied with the work I do.	5	6	5
I am very satisfied concerning promotional opportunities.	2	3	2
I am very satisfied with my relationship with my supervisor.	2	3	2
I am very satisfied with my relationship with my coworkers.	5	5	4
I am very satisfied with the owner.	1	1	2
Overall, I am very satisfied with my job.	3	3	2

Employee Engagement (Strongly Disagree=1, Strongly Agree=7)	Salon Mangers Mean Score	Stylists Mean Score	Spa Service (Nail, etc.) Mean Score
I know what is expected of me at work.	2	6	6
	4	6	5
At work, I have the opportunity every day to do what I do best.	4	6	5
I regularly receive recognition and praise for doing good work.	2	2	2
My supervisor cares about me as a person.	4	4	5
The owner cases about me as a person.	3	2	2
There is someone at work who encourages my development.	2	2	1
At work, my opinions seem to count.	2	1	1
The mission of the firm makes me feel my job is important.	4	4	5
My coworkers are doing quality work.	5	5	6
I have a best friend at work.	3	4	5
Someone at work regularly talks to me about my progress.	1	2	2
In the past year, I have had opportunities at work to learn and grow.	2	4	3