Engstrom Auto Mirror Case Study

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Recommended: Relationships between incentives and employee performance

There are several organizational issues within the Engstrom Auto Mirror Plant that needs to be addressed. The top three organizational issues that would need to be addressed are the following: employee suggestions needs to be taken in account seriously, ensuring that the employees are valued and equality is maintained within the company, and revising the Scanlon Bonus Plan. Therefore, the root causes of these organizations issues when it comes to employee suggestions needing to taken in account seriously. The Engstrom Auto Mirror Plant employee suggestion rate dropped drastically from hundreds to just fifty a year (Beer & Collins, 2008, p.5). The significance of this number dropping so low portrays that the employees of the company possibly …show more content…

“Equity considerations play a major role not only in the evolution of distributive systems but all in the emergence of supporting ideologies and the processes through which distributive systems are challenged and replaced” (Cook,K.S., & Parcel, T.L. 1997, p.2). Therefore, when the employees are rewarded for their work they will most likely work harder to restore the balance of equity. Whereas if an employee is under rewarded the employee will most likely do the opposite and not work as hard. The ongoing issue at Engstrom Auto Mirror Plant was that the employees were being under- rewarded and not appreciated by upper management, which lead to low productivity that severely impacted the companies …show more content…

The plan paid out bonuses regularly along with paying a percentage of the labor savings each month. Which motivated all of the employees to increase their morale and increase their productivity. However, the only misleading part about the Scanlon plan was that the employees began to believe that the bonus was part of their regular paycheck, instead of relating the bonus with their own improved efforts they put into the company. Therefore, expectancy theory has been a dominant model in explaining how people make decisions regarding effort expenditure at a workplace; the conventional approach while applying the theory involved in multiplying the outcomes such as pay raise or promotion by expectancy of an outcome that will occur if a person works hard. (Biberman, G., Baril, G. L., & Kopelman, R. E., 1986, p.2). Furthermore, the results in the expectancy theory would be obtained by a motivational force score that would possibly predict work effort and job performance across the employees. So, it is ideal that the employees would respond in a positive manner to the following three essentials for them to employ extra effort and performance on a specific job. The three essentials are the following: expectancy, instrumentality and valence are linked to motivation. If an employee feels valued and rewarded for the efforts they’ve

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