Engstrom Auto Mirror Case Study

The problems at Engstrom Auto Mirror have become highly detrimental to the performance of the organization and are threatening its viability. The employee performance issues can be attributed to a lack of motivation and a perceived lack of fairness that has caused distrust in management. Another reason for the decrease in the quality of employee production is the dissatisfaction with the Scanlon Plan that has outlived its usefulness and should be redesigned. The result of low productivity and poor quality of work has resulted in a plant that is mired by unprofitability and management has been unable to solve problems and increase the staff morale. Management should create and implement a solutions development plan that will improve organizational
This can be a tricky slope for employees because the perceived level of fairness can vary from employee to employee, however the Engstrom employees feel they are being unfairly treated and that management is manipulating the numbers used to calculate employee bonuses. Employee productivity and the quality of work as well as employee morale are plummeting due to the perceived inequities. Currently, Engstrom has eight committees composed of supervisors and employee representatives that read the employee suggestions and decide which ones to implement and which ones to pass. The number of committees should be combined or reduced altogether and suggestions should be passed based on costs to implement, level of return on investment and relevancy to organizational needs. This will reduce the number of suggestion going before the screening committee, streamlining the selection process. The Scanlon Plan relies on feedback and making the decision process more public and open to discussion may improve employee motivation as they would feel more invested in the organization and help bring the perceived inequities back into balance. The motivating potential of employees goes beyond monetary bonuses and relies on feedback more so than the employee’s variety of skills or significance of task identity (Bauer & Erdogan, 2013). However, the calculations used for the Scanlon Plan bonuses are confusing and will need to be recalculated in order to make the plan successful and to motivate the employees monetarily. The combination of monetary and behavioral motivation will inspire the employees at every intrinsic and extrinsic