Engstrom Auto Mirror Plant: Motivating in Good Times and Bad

Case Study Analysis: Milestone One

Engstrom Auto Mirror Plant: Motivating in Good Times and Bad

Adryon M. Forbes

Southern New Hampshire University

Introduction

Engstrom Auto Mirror Plant is a privately-owned company that manufacturers mirrors for automobiles and trucks in Richmond, Indiana. The company is a rather small company with only about 209 employees. The company had major productivity issues from the beginning and quickly found a new bonus plan in attempt to increasing sales and getting their employees more motivated to sale and reach higher goals so they began to consider options to improve the company’s current issues. The managers Ron Bent and John Hayley came across an incentive called the “Scanlon Plan” which turned out to be very successful and had made a major turnaround for the company’s revenue sales and team overall, but unfortunately by 2005 the plant reached a major downfall in their revenue sales which, of course, caused layoffs of 46 out of 209 associates.  By 2007, the entire company was headed downwards which never looks good for the future of any company especially with its significant decrease in productivity, employee morale and revenue sales.

If Engstrom is considering to make a great turnaround for the company’s greater good, there are a few organizational issues that need to be addressed. The first would be revaluating the Scanlon Plan or either just getting rid of it and creating a new incentive plan because the current one is not as direct as it should be which causes a lot of distrust and uncertainty that I believe has led the employees to the point to where they are now becoming unmotivated. Another issue to address would be to create better communication between the employees and managers so that they are aware of everything going on with the company’s system upfront and also apply motivational seminars so that the employees begin to enjoy what they do again and increase sales. The managers may need to participate in a class that explains organization behavior and how the culture should be at the company. Organizational behavior is the systematic study and careful application of knowledge about how people act within organizations (Newstrom, 2015). Lastly, the rebuilding of trust between the managers and employees is very much necessary. It may not seem important but it actually causes more issues than it appears. If there is no trust amongst the workers and their higher ranked managers then that will lead to poor communication, lack of employee morale, lack of work and could unfortunately lead to the closing of the company altogether. How can a company function without any workers? It absolutely cannot. The trust is a major organizational issue at the Engstrom plant. The case study stated that some of the plant’s workers felt that it was unfair when some of the higher ranked managers continuously received their bonuses monthly and the lower lined workers either lost or began receiving lower amounts from their bonus. That alone drives employees away and causes them to have no inspiration for the job.