Based on the 2007 unproductivity and low-profit issues that faced the Engstrom Auto Mirror Plant, the plant manager Ron Bent had to lay off a significant number of employees owing to the fact that a majority of employees had become dissatisfied with the newly invented Scanlon Plan. Usually, a low morality of workers causes low productivity which in turn, brings about many consequences on the business such as an increase in the product cost as well as the decrease in product quality which leads to customer dissatisfaction and an overall reduction in the overall companys profits. This being said, the core intent of this paper is to employ different human behavior theories to create solutions that will improve the situation and help solve the issues that are faced by the Engstrom Auto Mirror Plant.
Firstly, concerning the organizational improvement outcomes, it is necessary for the Engstrom Auto Mirror organization to rebuild their employee trust once again, for them to succeed in any motivational program. In my opinion, for Engstrom to achieve their desired organizational outcomes, revising the Scanlon Plan with the support of both the managers and the employees will be the best solution available. Basically, the process of reviewing the Scanlon Plan will involve weakening all the aspects that initially led to the failure of the plan such as the complications of the plan which according to the employees, resulted in a lot of distrust and dishonesty relating to their bonus amounts. Thus, based on the Path Goal Theory, it is the obligation of the leaders to come up with the measures necessary to motivate their subordinates for them to accomplish the desired goals and outcomes (Newstrom, 2015). This being the case, both the managers, Ron and Joe have a primary role to play concerning the transparency of the Scanlon Plan so as eventually earn back their employees trust.
Besides, according to my analysis, the core problems that fundamentally underpin Engstrom Auto Mirror Plants potential are unfairness of rewards between their employees and supervisors and also distrust between the organizations managers and the employees. Thus, for the company to maintain both their profitability and productivity, these issues should be resolved so as ensure that the employees input the best in the organization. With reference to the expectancy theory, any given organization must be in a position to meet three specific elements for it to obtain extra task efforts from their employees (Wigfield, 1994). Firstly, as in the case of Engstrom Auto Mirror Plant, the organization must meet valence which is a reflection of how much an employee truly needs the reward, usually in terms of bonuses, that is at stake. The second element is expectancy, which is usually the employees self-estimate of their probability of obtaining the reward. Finally, instrumentality, which is the estimation that an individuals actions will actually result in the reward is the final element that the plant must meet. Thus, in regards to Engstrom, if the three aspects of the expectancy theory meet a positive result, then its employees will be in a position to exert extra efforts in their daily inputs and this, in turn, will lead to outcome improvement for the plant.
Additionally, as part of their strategic actions, I recommend that Engstrom adopts any new machinery or technology to remedy the current ravage on their profits. However, right before the adoption of new technology, the employees should be well aware that their benefits and bonus increases are solely dependent on how fast they adopt the new technology. This, in essence, boils down to equity theory of motivation in which case, the employees were initially over rewarded in the initial days of the implementation of the Scanlon Bonus Plan. However, given time, the employees gradually lost their motivation when they started feeling like whatever they received in the form of bonuses was their entitled salary and as a result, the motivational force that was initially incorporated in the Scanlon Plan became non-functional. As the theory states, individuals, such as the Engstrom employees, are primarily motivated by fairness (Miner, 2007). Therefore, in the cases where the people identify signs of inequities in either the input or output ratios among themselves, then they are bound to adjust their input to attain their perceived equity. Therefore, if Engstrom would adopt new technology or a new marketing strategy, all with their employees consent, then they will achieve both their productivity and profitability.
In a nutshell, based on the fact that the Engstrom Auto Mirror Plant has been in business for quite a long time, I believe that it is, unlike many companies out there, an established company. This being the case, I believe that the productivity and fairness issues together with the plants reputation should be enough reason why the plant should get a proper solution through their implemented Scanlon plan or even get to remedy the already damaged one. Engstrong, therefore, needs to create, or rather modify an incentive plan that recognizes the employees job performance and also offer financial rewards to its employees, based on individual performance. In my opinion, I feel that both the Plant Manager, Ron Bent and Joe Haley, his assistant should draft a well modified and updated Scanlon plan for the sake of saving their company. Besides, the two should make use of my suggested equity, expectancy and path goal theories of motivation and also remember that it is only through productive employees, that their business will thrive.
Miner, J. B. (2007). Organizational behavior 1: Essential theories of motivation and leadership. New Delhi: Prentice-Hall of India Private.
Newstrom, J. (2015). Organizational behavior: Human behavior at work (14th ed.). New York, NY: McGraw-Hill Education.
Wigfield, A. (1994). Expectancy-value theory of achievement motivation: A developmental perspective. Educational Psychology Review, 6(1), 49-78. doi:10.1007/bf02209024
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