Engstrom Auto Mirror Plant.

Introduction:

Engstrom Auto Mirror Plant, located in Richmond, Indiana (Beer & Collins, 2008) is a private manufacturing company of mirrors for automobiles since its establishment in 1948. A relatively small production and distribution company which saw many great years had started to see a decline as it reached a new millennium. Due to a lack of production, lack of technological knowledge and consistent drop of morale amongst the workers, the previous plant manager resigned, and the company hired a more tech savvy and pro-incentive thinking Ron Bent. This newly hired plant manager and his assistant Joe Haley quickly noticed this production crisis right away as important customer orders were well behind schedule and in grave danger of supplying defective mirrors that had not been quality inspected. The decline in morale amongst the workers in the plant often led to hostile conversations as well. In an attempt to change the culture, atmosphere and overall productivity in the plant, Bent introduced the Scanlon Plan, which is a bonus incentive program that “reinforced teamwork and cooperation across work groups while they focus attention on cost savings and motivating employees to work smarter not harder” (Beer & Collins, p. 537) to lead the Engstrom Company’s initial turnaround.

However, by 2006, an industry downturn forced the company to lay off 50 employees and the quality of work was seriously endangering customer relations. The company wide incentive “Scanlon Plan” was no longer working. Bonuses were stopped and Bent was forced to reevaluate the plan in order to keep the workers motivated and Engstrom open for the foreseeable future.

Organizational Issues:

Increased production time, lack of new technology, frustrated customers, low morale amongst the workers in the plant all led to a new change in leadership. Ron Bent, a younger, eager and more willing to adapt to the changing times was brought in