The Engstrom Auto Mirror Plant Case Summary

After reading the case study it seems that one problem between the hospitals and upper management seems to be lack of communication. It seems that Singh and Mrs. Manzoni have not affectively communicated to the hospital administrators what the goals of the company are and what is best for the company. I believe that Mrs. Singh and the hospital administrators value the importance of two different things. Mrs. Singh values the importance of correct data entry into the firm’s management information system. While, the hospital administrators seem to be placing more value on the importance of patient services. In addition, it seems Mrs. Singh does not know what

Companies can just settle for fewer profits by absorbing the increase cost of their current labor supply instead of dismissing workers. This is one method might be the least popular method and the least used by firms. Using this approach decreases the company’s net profit. This method should only be used by firms in a strong financial position and there is no other approach that can be used.

In May 2007, the Engstrom Auto Mirrors plant was facing the crisis. The business was doing badly and the sales had started to decline in 2005. Thus, there was a steep reduction in plant productivity and employee morale was all time low. The company used Scanlon Plan as an incentive for staff. The core element or foundation of the plan was concept of participative management, where management and staff together will decide the bonuses based on revenues for that year.

The Scanlon plan created problems within the company and questions had to be formulated and put into place to be addressed before any major decisions could be made. Although the Scanlon plan was a good plan, it was not a “one size” fits all plan. Changes needed to be made and what type of changes had to be addressed. Some of the other difficulties facing the company was, no

The Scanlon Plan can be used as a major catalyst to turnaround the plant by emphasizing more on productivity. The more they work the faster they roll towards their bonuses; this magical spell is a win-win situation for both the employees and the management. The management can cruise steadily over the wave of bonus motivated productivity and the employees can reap the benefits from the high production rate in terms of bonuses. The plan can be redrawn and a slight change can be made by making the entire plan revolve around the concept of productivity. When productivity assumes a prime position in the plan, employees will strive hard

Nash also failed to consider the additional loss of consumer confidence and capital if the sale went through and Fledgling sued DAC for fraudulent misstatement about the condition of the property. Nash also failed to consider his social responsibility to the rest of the environment by not addressing the issue as soon as it was brought to his attention. Similarly the CEO failed to consider his responsibilities to the passengers that were flying on planes that could have lost power due to the malfunctioning product. I would have included these issues in a cost benefit analysis which would support my decision to management.

* Employees might decrease rate of production as demand decreases to create an impression of need and to preserve jobs

In this portion of my case analysis, I will be showing ways for suggested solutions in order to help improve the situation at the Engstrom Auto Mirror Plant. I will be showing ways in which organizational improvement outcomes can directly help remedy some of the issues and recommend strategic actions that would lead the organization in a proactive production workforce. The recommendations are creating committees, rework how the Scanlon Plan bonus works, create or use their marketing and sales department to the full capacity, and to help empower the workforce work to achieve Corporate Social Responsibility. (CSR)

During May 2007, the Engstrom Auto Mirror Plant faces a low employee morale issue. The newly appointed manager, Ron Bent, sees a decline in work place productivity and culture throughout his recent years of working at the plant. When Bent joined the company, it was facing a similar issue of low morale. He then decided to introduce the Scalon Plan, an incentive program for the employees, to raise morale. The program was successful when it was first introduced but ran into problems time after. Bent was faced with many challenges with the Scalon Plan that caused him to ask many

One of the valued but demanding customer, who had considered Engstrom as a certified supplier, was requesting a large order but Engstrom was unable to deliver on time due to the low productivity problem. The plant manager along with his assistant were already dealing with the troubling numbers when this happened. While the task was a tough bone and not easy to tackle, and there were a lot of factors needed to be taken in to consideration. The leadership started to analyze and break down the main causations other than the overall economic trend that dragged the company into the turmoil, as it turned out, it was the low, frustrated employee morale and diminished work satisfaction.

To answer these questions, the recommendation is the Ron and management team work with employees to comprehend the underlying issues behind their dwindled productivity, identify likely solutions to the issues and make changes to the Scanlon Plan to enable the incentive plan effectively motivate the employees. It is important that employees are involved throughout the entire process and that any adjustments, no matter how small are presented honestly to the employees.

Engstrom Auto Mirror plant, as a privately owned business, it manufactured mirrors for trucks and automobiles. The managers aimed to increase productivity for sustainable development of the company. Back in 1998, to pursue highly productivity, the plant was redesigning its production lines to incorporate new technology, however, the transition was not smooth, some problems had emerged, such as the staffs' moral and efficiency declining and the internal contradictions being intensified between the managers and employees. As the result of it, the previous manger resigned in 1998. After that, the new manager, Ron Bent believed in the power of worker incentive programs and wanted to establish one at Engstrom. Eventually, the plant adopted the

They also didn’t appear to honor any form of schedule or business ethics because they were charging direct labor time to the project while working on other projects. Functional management appeared to lack leadership and direction across the whole unit.

Low morale among employees in any company eventually leads to decreased profits with other factors of the business decreasing along the way. “And US Airways employees, who have seen their pay cut by more than 20 percent and their health insurance and pension plans shrink, are certainly an unhappy lot” (Claudia H. Deutsch). In order to increase profits, the airline has decreased pay and took away some of the earned vacation. “Company executives say they are taking steps that will improve working conditions and profitability” (Claudia H. Deutsch). Many employees were calling in sick which the company believed would eventually lead to poor customer service.

Hinrich had no intention of laying workers off to meet bottom line numbers. Although this was partially driven by the difficulty in laying workers off imposed by the union, he also felt that it would cause a decrease in moral and even further hurt the plants productivity. Instead of utilizing denominator management Hinrich chose to use numerator management and meet budget goals by improving processes, decreasing production costs and improving efficiency. This is a much harder approach for managers to take when trying to increase revenues and meet budgetary goals, but it was what Hinrich felt needed to happen.