Engstrom Case Study

Robin Williams

Milestone One: Engstrom Case Study

Introduction:

Located in Richmond, Indiana lies the home of Engstrom Auto Mirror Plant currently operated by the manager Ron Bent and his assistant Joe Haley. The Engstrom Plant is a privately owned and operated facility, that fabricates mirrors not only for trucks but other automobiles as well. With just over 200 employees both Ron and Joe face tumultuous times.

Starting its operation back in 1948, Engstrom succeeded for many decades, in times where it seemed impossible. But in the 1990’s, that luck started to run out when the implementation of technology to the production line proved to be a larger hurdle than anticipated for the former plant manager. Eventually delays in production caused customers to become upset, and therefore caused these relationships to become estranged. With a plant manager who was unable to resolve production efficiency quickly, relationships on all sides became strained and it became self-evident that new guidance was needed. So, in 1998, the plant manager stepped down and current manager Rob Bent was hired.

Eager to implement new change to the Engstrom Plant, Bent spent countless months researching and formulating a specific plan of action that would succeed at Engstrom. After countless communications with employees, the Engstrom family, and outside organizations, a Scanlon Plan was formulated. Having worked at a camshaft plant before with a similar concept in place, Bent knew, “when things are working properly, teamwork and knowledge- sharing typically improve in Scanlon organizations” (Newstrom, 2015). With productivity and morale at an all-time high, problems seemed to be solved. Unfortunately, nearly a decade later Ron Bent was facing similar issues as he did in 1998, when “a downturn hit the industry”, forcing him to lay off nearly 20% of his employees (Newstrom, 2015). With no new plan in apparent sight, Mr. Bent appears to be following the footsteps of the former plant manager.

There are a multitude of organizational issues that are occurring within the walls of the Engstrom Auto Mirror Plant. As Newstrom states, “organizations are complex systems” and “human behavior in organizations is sometimes unpredictable” (Newstrom, 2015). The organizational issues that will be focused on in this analysis include: downward communication, the need for an open-door policy, as well as the need for a paradigm shift. These issues are some of the leading problems contributing to the downfall of the Engstrom Auto Mirror Plant.

When the Scanlon Plan was introduced in December of 1999, communication was at an all-time high at Engstrom. The efforts that Ron Bent took in order to inform his employees about the benefits of the Scanlon plan were above and beyond what the any former leaders ever demonstrated. Examples include Bent, “posting information about Scanlon on bulletin boards, and spending many hours jawboning workers whom he had heard were opinion leaders” (Collins & Beer, 2008). But as times got tough at Engstrom the communication amongst all levels of the team started to dissipate, therefore leading to a new need for downward communication.

While the Engstrom Plant has monthly meetings the need to have better communication could be achieved with an open-door policy. According to Newstrom, the goal of an open-door policy is to “remove the blocks to upward communication (Newstrom, 2015). As times got tough at the plant, the dynamics of the monthly