OL 500 Final Project Assignment

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Southern New Hampshire University *

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Jan 9, 2024

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1 Case Study Analysis: Case Study of Engstrom Auto Mirror Plant and [Workplace] Brent Williams Southern New Hampshire University OL 500: Human Behavior in Organizations Dr. Kathleen Cornett November 19, 2023

2 Introduction of Case Study Analysis: Organizational Issues Original Milestone One Analysis The Engstrom Auto Mirror Plant provided a good case study on some management issues that often take place within a company. One of the major issues is with a manager with positive experience in one system of management. This manager then believed it to possibly be the best way to help improve morale throughout the plant. The system worked under certain circumstances, but as those circumstances changed the system no longer provided the necessary incentive to maintain morale. As one manager pointed out, “they’ve had it with the Scanlon Plan…’ What’s the point of having a bonus plan if no bonus is paid for months?” (Newstrom, 2015, p.236) The employees held a lot of distrust with the management and felt that the incentive plan was not fairly distributed. The ratio for the incentive plan continued to change leading to more distrust with the plan and with management. “Some employees felt that supervisors should have received a reduced bonus because they were ‘not working as hard as we are’” (Newstrom, 2015, p.541). It did not matter how management explained the system, the employees felt, “The complex nature of the calculations itself, which some felt was ‘full of bean-counter jargon,’ also caused distrust” (Newstrom, 2015, p.540). As production and profitability decreased, management began discussing the need for layoffs. The discussion and eventual layoffs “shook the confidence of even the most fervent Scanlon proponents among the workforce” (Newstrom, 2015, p.541). There became an increase in worker disaffection, with management identifying suspected employee pilfering after a review of inventory reports (Newstrom, 2015, p.541). New Final Project Content The distrust experienced by the employees was a major contributor to the loss of morale and decline in productivity. As individuals lose motivation to perform, production will decline and a business will see profits decrease. When this occurs, a company must work to gain the trust of the employee and understand the root cause of the issue. Introduction of Case Study Analysis: Model Original Milestone One Analysis Bent used the Custodial Model of organizational behavior. This model consisted of management using economic resources as a motivator to increase production. The custodial model says “Employees working in a custodial environment become psychologically preoccupied with their economic rewards and benefits” (Newstrom, 2015, p.46). Employees became reliant on the rewards and bonuses. So when the bonuses began to decrease, worker production also decreases. After the bonuses stopped, employees responded with anger and distrust. Employees felt, “something that rightfully belonged to them had been taken away” (Newstrom, 2015, p.537).

3 New Final Project Content The custodial model used by the company was short lived, because of the loss of the economic motivator when profits decreased. Employees felt the bonuses were part of their regular salary and began to rely on them as income. As the bonuses decreased the lack of economic incentive reduced the motivation of the employees and the company began its decline in production. Introduction of Case Study Analysis: Human Behavior Theory Original Milestone One Analysis One of the issues with management’s technique was its reliance on extrinsic motivators. Management felt the best way to motivate the workforce was through tangible goods, such as bonuses. As these bonuses decreased the production decreased and became a downward cycle leading to layoffs (Newstrom, 2015). “The tendency of extrinsic motivation to interfere with intrinsic motivation is known as the over justification effect. This involves a decrease in intrinsically motivated behaviors after the behavior is extrinsically rewarded and the reinforcement is subsequently discontinued” (Cherry, 2022). Extrinsic motivation can be a powerful motivator, but does not work in every situation. The plant managers must find a balance between extrinsic and intrinsic motivation. As the plant managers begin to understand the workforce, they will understand how to increase the productivity of the plant. This can occur through open communication between management and the workforce. As managers began to show greater concern for the employees, the employees will become more willing to discuss plant issues. This could lead to more suggestions on improvement and a higher morale. “Without clear and consistent communication, employees lack direction, productivity suffers, employee engagement levels decrease, and conflict arises” (Miller, 2022). New Final Project Content Understanding the advantages of intrinsic and extrinsic motivations is an important part of management. The company must provide a better approach to gaining the confidence and trust of the employees. One way to accomplish this is by helping alleviate concerns of the employees and remove those contributors to the dissatisfaction they are experiencing. As Herzberg concludes once dissatisfaction overcomes satisfaction performance and quality is degraded (Nickerson, 2023). One way to increase job satisfaction is through recognition, and possibility for growth and development. This will help to satisfy some of the intrinsic factors that motivate employees. At that same time reducing the issues that create job dissatisfaction will contribute to a more productive workforce. This can be accomplished through the incentive program, if it is simple to understand and equitable in its distribution.

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4 Case Study: Root Causes Original Milestone Two Analysis The Engstrom Auto Mirror Plant faces organizational issues from multiple root causes. One of the main roots of the organizational issue stems from management’s failure to understand the organizational culture of the auto plant. Without understanding the culture, management introduced a plan to incentivize the workforce. Management felt that through the monetary incentives it would increase productivity, employee morale, and improve quality (Newstrom, 2015). Management did not address the conditions of the workplace, or the reason for low employee morale. The lack of communication and engagement with the employees contributed to the future distrust of the plan. The plan worked well for only a short period of time. However, once the company saw the beginning of an economic downturn, it upended the ability to payout the monetary incentivizes and maintain the artificially inflated employee morale. The employees no longer received large bonuses and felt management was providing unfair calculations (Newstrom, 2015). Poor communication and lack of employee engagement were a contributing factor to a decrease in employee morale. The inability to understand the calculations used in the bonus, in a large part was due to the inability of management to communicate effectively. If management is not effectively communicating with the employees, employees will be less likely to engage with management. This was shown throughout the plant with employee behavior and providing less feedback to management and decrease in suggestions for innovative improvement (Newstrom, 2015). Poor communication was only realized after production, quality, and employee engagement declined. Employees want to understand what is happening in the workplace. This happens through honest and open communication and can alleviate misunderstanding and improve employee engagement. It helps the employee become more involved and needed, thus improving employees’ job satisfaction (Grossman, 2022). Another contributor to the low morale was the perception of unfair bonus calculations. The employees continued to complain about their unfair treatment. Employees felt they were producing more than the leadership and should receive a larger share of the bonus. To the employees, the contribution rate mattered and the bonus should be distributed accordingly (Newstrom, 2015). “Adams' Equity Theory acknowledges that subtle and variable factors affect an employee's perception of their relationship with their work and their employer” (Mind Tools Ltd, 2023). In Adams’ Equity Theory, the relationship between what an employee contributes and what the employee receives in return can help in job satisfaction. This is especially true if the employee feels that there is a balance between what they receive and how much they contribute. Dissatisfaction happens if the employee feels they contribute more than what they perceive is provided in return (Mind Tools Ltd, 2023).

5 This relationship between worker contribution and bonuses led to a greater dissatisfaction and a reduction in the productivity of the workforce. In addition, management began to suspect employees of pilfering equipment further eroding the relationship between management and the workforce (Newstrom, 2015). New Final Project Content Increasing employee engagement and providing more effective communication strategies is one of the first steps to regaining trust and loyalty with the workforce. This should be a short term and long term strategic response to overcoming motivational issues in the employees. The employees will become more involved in finding solutions to concerns and feel a greater responsibility to ensure the success of the company (Grossman, 2022). Case Study: Solutions Original Milestone Two Analysis In order to overcome the poor communication issues, management should increase engagement with the employees. Employees will become more engaged if they feel management sincerely cares for the employees’ welfare. This will also help increase trust between the employees and management. A trusting relationship is necessary for effective communication at all levels. This will help address part of the morale issue and increase employee satisfaction (Talmage-Rostron, 2023). In addition, the company should adjust the incentives based on employee contribution. This will address some of the issues regarding equal distribution of monetary incentives. Creating a production-based incentive, based on employee contributions, and addressed in language the employees can understand will help alleviate employee concerns with the monetary compensation plan. An appropriate incentive plan should work beyond the short-term benefits and ensure employees understand the long-term benefits to both the employee and company. The overall company strategy should also be communicated honestly and effectively through language the employee understands without confusing the employees with data and metrics (Indeed, 2023). New Final Project Content The company should engage the employees and provide open and honest communication. The continued lack of communication is a concern to the employees and contributes to the perception of unfair treatment. As an open and honest communication occurs, employees are more likely to develop a relationship of trust. This would provide a baseline to continue development of a more equitable incentive plan. Realigning the incentive based plan and providing a simpler and easy to understand formula, will help alleviate the concerns of the employees. A simple and easy to understand incentive plan alleviates the employee perception of ever-changing goals in the incentive plan. Communicating honestly the company’s strategic goals, while aligning the individual goals will help maintain the trust of the employees.

6 Case Study: Strategic Actions Original Milestone Two Analysis Engstrom Auto Mirror Plant should produce an effective communication strategy that works to engage management with employees and increase job satisfaction. One way to increase employee satisfaction is by addressing three factors, equity, achievement, and camaraderie (Belyh, 2019). Providing honest and open communication on job performance, company values, and strategic objectives should be completed on a regular basis. This will provide opportunities to improve performance and reinforce the company’s mission and values. Addressing the incentive plan in a way that removes the confusion and provides a better understanding of the objective can help mitigate the distrust. This is another aspect of open and honest communication, but needs to be accomplished in a way that is a better fit with the employees understanding. It will also help build a better relationship of trust at all levels of the company. Understanding the strategic objectives of the company will also help the employees see how their contributions fit with those objectives. It will provide a greater sense of achievement and further increase job satisfaction (Belyh, 2019). In addition, the company should create a culture of camaraderie. “Camaraderie refers to a culture which provides trust, friendship, good communication, teamwork, effective leadership, and surely enthusiasm” (Belyh, 2019). Increasing social opportunities that help build camaraderie, may also improve job satisfaction and provide opportunities to develop trust. These events should take place both inside and outside of the workplace, and enjoyable to employees at all levels. New Final Project Content “is concerned with the growth and development of people toward higher levels of competency, creativity,

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7 and fulfillment” (Newstrom, 2015, p 21). “is concerned with the growth and development of people toward higher levels of competency, creativity, and fulfillment” (Newstrom, 2015, p 21). A human research approach, “concerned with the growth and development of people toward higher levels of competency, creativity, and fulfillment” (Newstrom, 2015, p 21), will help build the trusting relationship the company needs to further increase production. The supportive model, as well as open and effective communication will guide the company toward the strategic goals, production, and quality the company seeks. Case Study: Description, Understanding, Prediction, and Control Original Milestone Two Analysis Description applied to the organization demonstrates the information obtained through observing activities. The description must be defined in terms that are quantifiable with all known facts. Such as describing the incentive plan, company values, and strategic objectives in a way that provides a complete description without error. Understanding is important to the organization at all levels. If one party does not understand the company values, they may act on misconceptions and disrupt the productivity of the company. This can be seen with the employees understanding of the incentive plan and how it is

8 implemented. This misunderstanding degraded the morale of employees and led to decrease in production. Prediction provides an observation of activities and the outcome. The more an activity is observed with the same outcome, one can predict a future outcome from a specific event. This can be both a positive and negative influence on a company. If the outcome of an activity is perceived as fair and equitable, an employee will continue to perform. If the outcome is perceived as unfair, activity may decrease, as seen with the distribution of monetary compensation. Control is essential to an organization to guide the behaviors of the company to achieve the desired outcome. In order to control and guide the behavior, it is important to accurately define the issue and root cause of behaviors. This will help define what steps to take in order to control the final outcome or guide employees behavior to achieve the goal (Bouchrika, 2023). New Final Project Content Once the company defines the root cause of the issues, which seem to be lack of communication and loss of employee trust. The company must understand how these issues developed and then work to overcome them. The company must now communicate their strategy and goals honestly and effectively. This will help all employees understand the concerns of the company, while management gains a better understanding of the concerns of the employees. Helping the employees gain a better perception of the problem and a better understanding of the incentive plan, will help the employees accept the plan. The company must maintain the open and honest communication, in order to predict the strategic success of this plan. This will also help the company guide the behavior of the employees and control the outcome. Workplace: Organizational Issues Original Milestone Three Analysis This case study provided a better understanding of my current employer, a large corporation with several different locations throughout the United States, as well as internationally. This portion provides an analysis and solution for a small site in the western United States. Some of the issues involved with this site include high turnover, ineffective communication, and distrust in corporate management. The majority of the issues originate from corporate management outside of the local site. Our site is a smaller site separated from the corporate headquarters, which makes communication difficult and often impersonal. A majority of the communication is done digitally and often feels insincere. It often does provide enough detail or allow feedback or questions from employees to clarify the intent of the communication. This lack of effective communication can lead to further distrust in corporate management (Forbes, 2020).

9 The turnover ratio at our site is not as high as other locations, but is still an issue that needs to be addressed. Some employees work in our positions for a short period of time, usually a year or two and then move to a government position. This can create staffing issues, if other employees must work overtime to fill those shifts. It can also create a burnout and mental fatigue, if it continues for too long (Ro, 2021). New Final Project Content Engstrom Auto mirror plant has many of the challenges facing my employer. Many of these issues are derived from an ineffective communication strategy. As Engstrom’s overcomes the communication concerns and develops a more effective strategy, many of the plant’s concerns will be mitigated. Effective communication is a key to developing trust, loyalty, and better communication. “We need to listen with the intention of helping our colleagues feel heard, valued and understood. This will allow us to develop greater trust and communicate more effectively” (Forbes, 2020, par.14). Workplace: Root Causes Original Milestone Three Analysis The root cause of ineffective communication is most likely because of the distance from our site and the corporate management. The corporate management is located on the east coast, where our site is in the western portion of the United States. This makes it difficult for personal visits from corporate management. In addition, our site is a smaller location than most of the other managed sites in our division. Employees often feel this leads corporate management to overlook our site, while most of the attention is directed to the larger sites. Many of the messages that our site receives seem to be canned communication that is impersonal and insincere. This is one of the major reasons for distrust in the corporate management (Forbes, 2020). Another organizational issue is the high turnover. This high turnover leads to employees and supervisor to work extra hours to fill shifts due to lack of employees. It also requires more time to continuously train new employees that fill the empty positions. One reason for the high turnover is the lack of challenge to the positions. They are entry level positions that do not require experience, but they do require an extensive background check and government clearance. The hiring process takes approximately one year from the date of application until the government provides the eligibility letter for the employee. Since it is an entry level position the salary is low, but competitive to industry standards. After working for a year or two, many employees leave the company for a higher paying government position. So, our positions are often looked at as a stepping stone to government employment. Employees may not feel challenged in their position, as well as an inability to develop higher skills (Pomerantz, 2017).

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10 New Final Project Content In the Engstrom case study, a lack of communication and distrust arose from the complex incentive plan. It provided a perception of an unfair practice in the distribution of funds. The employees continued to perceive the plan was in constant change, and misunderstood the data that was provided. A simpler approach to the plan may mitigate this perception and rebuild trust in management. Providing a simple, honest, and straightforward approach will allow the employees an understanding of how the plan affects them, and what they can do to improve results. Unless the employees understand the incentives, and perceive the plan as attainable and equitable, they will not trust management to distribute the bonus appropriately. Workplace: Solutions Original Milestone Three Analysis The solution to the ineffective communication and lack of trust, is in providing more frequent communication with employees, and not just the site supervisors. The communication needs to be more transparent, sincere, and personal. It cannot be exclusively in the form of canned communication. Employees perceive this style of communication as a lack of care from management. More personable communication and more frequent visits to the site will help employees feel more involved with the company. They will also feel the company cares for their welfare. This will lead to a more trusting relationship at all levels of the company (Forbes, 2023). For the high turnover, a solution may involve increasing the compensation package. This could be a higher hourly wage as well as lower premiums in benefit packages. This could provide some initial assistance in employee satisfaction, but will also require more opportunities to develop higher skills with career growth (Herrity, 2023). New Final Project Content The biggest issue the company needs to address is an effective communication strategy. As discussed previously, many of the issues derived from ineffective communication. Employees did not feel management communicated appropriately, and therefore did not trust the incentive plan or the solutions to overcoming the downsizing and loss of employees. Creating an honest approach to communications can lead to a better relationship with the employees (Forbes, 2020). Workplace: Strategic Actions Original Milestone Three Analysis Strategic actions the company should take would include a comprehensive communication strategy and training for management. This could involve training courses on how to use technology for better formal and informal communications. Understanding that communication

11 needs to be transparent and designed with the audience in mind. This communication should also recognize employees, by name, for accomplishments and successes at each site (Forbes, 2023). In addition, the company must review industry standards for salary and benefits package on a routine basis. The company must look at compensation at each site differently based on the industry standards in the local area, as well as the cost of living for each area. This will allow the company to maintain competitiveness in the industry. It could help reduce the loss of employees to companies with higher wages. Also, the company should increase compensation packages for tuition assistance. This will help employees develop higher skills with a feeling of accomplishment. Developing employees and creating career opportunities is critical in retaining employees (Herrity, 2023). New Final Project Content Much like my current company, Engstrom failed its employees in communicating and managing the communication methods. The auto mirror plant should also provide a comprehensive communication plan that is ever evolving. In using technology effectively, the auto mirror plant can communicate through digital communication. The company should also conduct face to face communications that allow a more personable approach. Helping the employees feel involved in the company is important in communicating. It will help the employees take ownership in the success and failure of the company (Belyh, 2019). Workplace: Impact Original Milestone Three Analysis The turnover rate for the company is a critical issue that affects the health of the organization and the employees. Employees must work harder and longer to overcome the open shifts, which lead to employee burnout and fatigue. This creates health issues and job dissatisfaction. As Herzberg demonstrated in his two factor motivation-hygiene theory, when job dissatisfaction is greater than job satisfaction, employee morale decreases along with productivity (Nickerson, 2023). This is also true with lack of communication and distrust in management. A lack of interpersonal relationship between corporate management and employees at each site, creates a lack of trust. This also may lead to dissatisfaction at a lack of productivity. This is one of the hygiene factors in Herzberg’s theory (Nickerson, 2023). These two organizational issues left untreated will create an environment where the job dissatisfaction outweighs the satisfaction. Thus contributing to the turnover rate within the company. References

12 Belyh, A. (2019, September 25). Sirota’s Three-Factor Theory: Keeping Employees Enthusiastic . Cleverism. Retrieved October 22, 2023, from https://www.cleverism.com/sirotas-three-factor-theory-keeping-employees-enthusiastic/ Bouchrika, I., Phd (2023, November 14). The Four Goals of Psychology . Research.com. Retrieved November 19, 2023, from https://research.com/education/goals-of-psychology Cherry, K. (2022, October 22). What Is Extrinsic Motivation? VeryWell Mind. Retrieved October 2, 2023, from https://www.verywellmind.com/what-is-extrinsic-motivation-2795164 Forbes (2023, October 26). 20 Overlooked Keys to Sustaining Employee Morale. Retrieved November 5, 2023, from https://www.forbes.com/sites/forbesbusinesscouncil/2023/10/26/20- overlooked-keys-to-sustaining-employee-morale/?sh=55e20c2a5d3c Forbes (2020, October 5). 14 Bad Communication Habits and How Professionals Can Break Them. Retrieved November 5, 2023, from https://www.forbes.com/sites/forbescoachescouncil/2020/10/05/14-bad-communication-habits- and-how-professionals-can-break-them/?sh=36826447494e Grossman, D. (2022, August 29). Effects of Poor Communication in the Workplace (with Solutions) . Retrieved October 22, 2023, from https://www.yourthoughtpartner.com/blog/poor- communication-in-the-workplace Helmenstine, A. M., Ph.D. (2020, January 29). What Is a Control Group? ThoughtCo. Retrieved October 22, 2023, from https://www.thoughtco.com/what-is-a-control-group- 606107 Herrity, J. (2023, June 30). 9 Causes of High Employee Turnover and How to Prevent it. Indeed. Retrieved November 5, 2023, from https://www.indeed.com/career-advice/career-development/high-employee-turnover Indeed (2023). 7 Types of Incentive Pay (With Pros and Cons) . Indeed for Employers. Retrieved October 22, 2023, from https://www.indeed.com/hire/c/info/types-of-incentive-pay Miller, H. L. (2022, August 31). The Value of Open Communication in the Workplace . Leaders. Retrieved October 2, 2023, from https://leaders.com/articles/company-culture/open- communication/ Mind Tools Ltd. (2023). Adams’ Equity Theory . Mind Tools. Retrieved October 22, 2023, from https://www.mindtools.com/azv3n0k/adams-equity-theory Newstrom, J. W. (2015). Organizational behavior; human behavior at work (14th edition). Mcgraw-Hill

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13 Nickerson, C. (2023, September 28). Herzberg’s Two-Factor Theory Of Motivation-Hygiene. Simply Psychology. Retrieved November 5, 2023, from https://www.simplypsychology.org/herzbergs-two-factor-theory.html Pomerantz, S. (2017, February 24). How Many of the Top 10 Most Common Organizational Challenges Plague Your Company. https://www.forbes.com/sites/forbescoachescouncil/2017/02/24/how-many-of-the-top-10-most- common-organizational-challenges-plague-your-company/?sh=649c6491e795 Ro, C. (2021, May 19). How Overwork is Literally Killing Us. Worklife. Retrieved November 5, 2023, from https://www.bbc.com/worklife/article/20210518-how-overwork-is-literally-killing-us Talmage-Rostron, M. (2023, September 24). Importance Of Effective Communication In An Organization 2023 . Retrieved October 22, 2023, from https://www.nexford.edu/insights/importance-of-communication-in-an-organization

OL 500 Final Project Assignment

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