Engstrom Auto Mirror Plant Case Study

Engstrom Auto Mirror Plant: Motivating in Good Times and Bad

Quavian Belton

Southern New Hampshire University

Organizational Issues:

Between 2000 and 2005 several similar problems resurfaced which needed to be addressed soon. Bent was forced to lay off 46 of his 255 employees. For the rest of the employees that stayed, they noticed that they had not received their Scanlon bonus in some months on their paycheck. The higher-level authority and hardworking employees began to lose trust among each other and resent each other because of the unfairness of the bonus calculation. The balance between the employees and managers was misunderstood. The employees felt like the managers bonus for the managers shouldn’t be equal or more

to theirs if they weren’t working as hard as they were. Bent questioned: “Had this plan outlived its usefulness? Or was it a victim of its own success”?
Secondly, the plant/managers were lacking on motivating and rewarding their employee.

When the employees saw that the managers were receiving rewards and motivation for work they were lying about doing, the employees became upset. The employees complained about the unfairness that they were receiving. The employees began producing less work and less productivity. Rewarding and motivating their employees should have been one of their top priorities for the company.

In this paper, I will deliberate possibilities that Ron Bent could have used to loosen some of the problems that was occurring in his plant. First, revise the Scanlon Plan for the employees and management. Where the managers would be focusing more so on appreciation and recognition that the productivity of the employees. Then, change the Scanlon plan by introducing meetings were the ideas from the managers and workers can be concluded in a face to face manner. That would be for clarification of any suggestions and better understanding for some of the suggestions given as

well.

Root Cause Analysis:
Poor leadership/management roles.
“Emotionally intelligent leaders use their empathy, compassion, optimism, humor, integrity, caring, and persuasiveness to build relationships” (Newstrom, 2015, p.204). Bent lacked emotional intelligence for his business. He did not possess the traits for a beneficial business. These traits include being able to be responsible and accountable to approach and maintain valuable communication and knowledge to make decisions and resolve conflict in a timely and professional manner. Bent’s lack of emotional intelligence proves that he was well equipped for the position due to no education or training experience for the position as such. Although, Bent didn’t obtain the proper education Goleman (1998) believes that emotional intelligence continues to develop through life experiences.
Poor Communication of Scanlon Plan
The plan being used in the company was to be a form of motivation to get the workers production.

The Plan was initiated to reward individuals for working hard and increasing the company goals financially as well. The plan included higher level management receiving employee suggestions for improvement and monthly bonuses based of the productivity increase. The plan seemed well planned until they failed to mention the monthly bonuses calculations. The Plan was not well clarified of what percentage of the bonus that everyone receives and what was it based off. The misunderstanding led to accusations form the employees that there money was being played with. The company lacked a clear channel of communication between the employees who were actually doing the productivity and the management who were less active in the plant. When the company decided to introduce the Scanlon Plan to the employees they could have easily addressed all the issues prior too it getting out of

hand.
Dissatisfied Employees
Engstrom’s main goal was focused on the more production levels went up it resulted in the company financial status increasing. The bonus program worked as a shield of protection for low performers, so workers who were working hard start resenting this that everyone was receiving the same bonus despite working less or inefficiently(Lesieur,1958). The most important part was that workers began to take the bonus for granted and as part of the salary rather than a performance bonus. The workers became hostile towards working for the company. This reduced the motivation among the workers and reduces the plant’s performance. As the manager, Bent didn’t take the time to investigate the root cause of the entire production level to see what the employees really felt and understood about the job before bribing them with an incentive of a bonus to get the production levels up.

Resulting Impact
Resulting effect of poorly aligned and managed human behavior theories and concepts lead to the exact outcome Engstrom has encountered: employee complaints, financial issues, and company instability. The dissatisfaction of employees is the important to the productivity. It will continuously go down step by step. A company that possesses human behavior theories and concepts that are properly aligned in the workplace, establish a strong company foundation, management and employee system.

References
Goleman, D. (1998). Working with Emotional Intelligence. New York: Bantam Books
Newstrom, J.W. (2015). Organizational Behavior. (14th ed.). New York: McGraw-Hill Education.
Lesieur, F.G. (1958). The Scanlon Plan; A Frontier In Labor-Management Cooperation. Technology Press of Massachusetts Institute of Technology.