Case Study Analysis: Engstrom Auto Mirror Plant 1Case Study Analysis: Milestone 5Engstrom Auto Mirror Plant: Motivating in Good Times and Bad andPersonal Work Place ExperienceWilden AbreuSouthern New Hampshire University
Case Study Analysis: Engstrom Auto Mirror Plant 2Engstrom Auto Mirror plant, who struggled to stay afloat due to unmotivated employees, lack of productivity and increasing quality issues, was a privately owned business that specialized in manufacturing mirrors for automobiles and trucks. Located in Richmond, Indiana,Engstrom Auto Mirror Plant, suffered from several months of poor production. Ron Bent and his assistant Joe Hayley oversaw a staff of 209 employees and met every Friday to discuss the issuesthey had been experiencing; unfortunately for them, they sensed they had a crisis at hand. This wasn’t the first time Ron Bent had experienced a crisis at Engstrom Auto Mirror plant; he previously dealt with one in 1998 that was triggered by low employee morale. In order to solve the crisis and increase morale, Bent introduced a paid bonus program in order to stimulate increased productivity. This program is known as the “Scanlon Plan” and it helped Engstrom dig out of its first crisis (Beer & Collins, 2008).The Scanlon plan was originally developed by Joseph Scanlon in the 1930s and it’s still used as an incentive plan for organizations in the United States. The Scanlon Plan’s primary goal was to reinforce teamwork and cooperation amongst work groups while minimizing cost and allowing employees to work smarter and not harder (Beer & Collins, 2008). The Scanlon plan was introduced following a series of meetings with workers, visits to other companies that had anactive Scanlon plan, and input from management. Soon after Engstrom Auto Plant adopted this plan, sales quadrupled, staff received monetary bonuses and numerous suggestions and ideas to increase productivity, were accepted. The staff had a new found sense of empowerment and felt as though their suggestions and ideas were making a change thus increasing the overall morale ofthe company. Jim Lutz, a worker on one of the plants lines said: “It’s not just the money…I’m getting rewarded for thinking, not just for performing the same tasks every day. To me, that
Case Study Analysis: Engstrom Auto Mirror Plant 3means the plant values the knowledge I have about how my line runs (Beer & Collins, 2008).” Everything went well for a few years until another crisis came about. The issues started when employees began to distrust the company and the way they calculated bonuses. Engstrom had changed the rate at which bonus were distributed four times in a matter of five years and employees felt as though supervisors shouldn’t be getting the same rate as they were since they didn’t work as hard. When employees didn’t receive bonuses for a seven month span, morale andproductivity reached a new low.
You've reached the end of your free preview.
Want to read all 17 pages?
- Winter '14
- Management, Auto Mirror Plant