QUESTION ONE [30 MARKS]

The human resource manager of a trading company observes that the morale of employees in her company is low. She thinks that if their working conditions are improved, vacation benefits made attractive and the pay scales raised, the morale will be boosted. She doubts, however, if an increase in pay scales would raise the morale of all employees. Her conjecture is that those who have side incomes will just not be turned on by higher pay, and only those without side incomes will be happy with increased pay, with a resultant boost in morale.

Based on the scenario above:

(a) What is the broad problem area in this case?

(b) List and classify all the variables in situation.

(c) Draw a conceptual model.

(d) Develop five (5) hypotheses for this case