Instructions

You will use the Milestone Two Assignment Template for this assignment (attached). Milestone One is included in the text below (a word or PDF doc of this was unable to be uploaded), please reference Milestone One for this assignment.

Review the Engstrom case study (attached) looking specifically at organizational issues, and address the following:

II. Case Study: Root Cause Analysis & Solutions Development

a) Analyze root causes of known organizational issues from a human behavior perspective and validate your analysis with scholarly research evidence.b) Create solutions that are a direct remedy to the organizational issues by applying human behavior theories and concepts, and validate your recommendations with scholarly research evidence.c) Recommend strategic actions of sound change management practices that lead organizations in a proactive manner by applying human behavior theories and concepts.d) Explain the value and importance of description, understanding, prediction, and control as it applies to organizations as an open system.

Milestone One:

Introduction

          Engstrom Auto Mirror which was opened in the year 1948 and has been in existence for close to 60 years there has been a success which is as a result of increase in productivity plus higher profits as well as challenging times which is characterized by reduction in production, lower morale plus economic downturn. In 2007 Engstrom Auto mirror plant which is located in Richmond, Indiana, employed 209 individuals. Beer and Collins (2008) detail the experience of the plant manager Ron Bent as well as how the actions and ideas, mainly implementing the Scanlon Plan affect the operational success of the organization.

Introduction of Case Study Analysis: Organizational Issues Milestone One Analysis

There are organizational issues within Engstrom Auto mirror that can be identified from the case study. The issues with Engstrom involve the process of communication as well as including a decrease in upwards communication, semantic barrier, transparency plus the loss of four prerequisites for having effectiveness in downwards communication (Beer & Collins,2008).

            Upward communication is the flow of information from the employees to the management (Newstrom,2015). There was a decrease in the upward communication when Beer and Colling (2008) did describe the change in the employees’ suggestions which is from 305 proposals in the first year through the implementation of the Scanlon plan up to 50. This led to the reduction of upward communication which results in the managers lacking critical information which is required in coming up with informed decisions besides understanding employees’ needs (Newstrom,2015).

Semantic barriers in communication occur when recipients of the information could not understand the meaning of what has been written and said. These barriers are noted as employees did not understand the Scanlon bonus calculation as well as describing estimates being full of bean counter jargon (Beer & Collins,2008). Using specialized language in the calculation of bonuses created feelings of mistrust plus fairness in employees. Though the managers in the instance might feel they are transparent by sharing a detailed explanation of the bonus calculation transparency, honest plus timely sharing of the information between the individuals, is lost at the time when there is lack of clarity in the message (Newstrom,2015).

Moreover, the combination of absent positive attitudes from the management, management failing to get informed of employee’s needs, poor planning of communication as well as lack of trust between management and the staff (Newstrom,2015). As time continued progressing at Engstrom, the enthusiasm for Bent positive change dwindled when the downturn of the economy occurred. The conversation shifted from the discussion of positive happenings at Engstrom decreasing production plus layoff. Failure in being informed is evidenced at the start of the case study when Bent did fail in opening dialogue with employees concerning what should be changed to increase productivity.

Introduction of Case Study Analysis: Model Milestone One Analysis

The model for organizational behavior in this case is the custodial model. This model is usually based on the provision of economic security for the employees via wages plus other benefits which will lead to loyalty of the employees and their motivation. For the case of Engstrom Auto Mirror plant they were providing Scanlon plan bonus to motivate the employees. The problem arises when the company could not continue with the initial plan in place. The problem came up when they missed Scanlon plan bonuses which are a regular staple in the paycheck.

The personnel at the company could not be motivated in completing their daily tasks, there was lack of incentive to motivate the employees. This meant that the custodial model for employees had failed. In turn plant production was compromised. Scanlon bonus plan was created as the incentive for the employees exceeding workplace, this was made for rewards system for extra job. Unluckily, in due time, the employees were expecting to be rewarded for the meeting just the minimum work, reward system became the norm at the place of work and was being expected in everybody’s paycheck. If the employees had been rewarded for efforts, expected levels of performances will be high than normal; there was no reward given hence the behavior of employees could not change. Taking away the reward such as the percentage of individual paycheck, then the employee expected performance level will be low and undesirable.

In conclusion, why are plant employees’ high order needs not met, this is as a result of economic downturn, poor communication with the Bent plant manager, and ultimately as a result of Scanlon’s plan assuming employees will only require motivation through financial incentives.

Introduction of Case Study Analysis: Human Behavior Theory Milestone One Analysis

Though the economic downturn acts as the catalyst for the worsening numbers of production over some time motivation level at Engstrom steadily declining plus the engagement of the employees is lessened as indicated by the little upwards communication. By understanding Maslow’s hierarchy of needs, the organization could realize that giving more of the same rewards might have diminishing impacts on motivation (Newstrom,2015). Scanlon’s plan follows economic agency theory which indicates that when the organization utilizes compensation as the main factor for motivation, employees demonstrate behavior that meets the goals of an organization. Research by Olafsen et al., (2015) suggests that motivation of the employees is strong when the organization comes up with a stable interpersonal working environment through the provision of constructive performance feedback, recognition of talents plus the ability of the individual, asking of open questions besides offering opportunity for the employees for learning new skills. Scanlon Plan overdependence on the external incentive is cemented as the root cause for organizational issues facing Engstrom where if external motivation factors including bonuses provided by Scanlon plan are absent, employees could be motivated to perform well by the company providing non-monetary incentives.

The Scanlon plan over-dependence on the maintenance factors as the means for motivation, Scanlon plan is designed besides being implemented in the way that calculating the bonus is not explained clearly. Lacking understanding from the staff has led to feelings of unfairness. Bartol, Durham, and Poon (2001) argue that when individuals receive less recognition for work plus little rewards then they will end up feeling a sense of unfairness plus the perception of unfairness could be detrimental effect on motivation. 

References

Bartol, K. M., Durham, C. C., & Poon, J. M. (2001). Influence of performance evaluation rating segmentation on motivation and fairness perceptions. Journal of Applied Psychology, 86(6), 1106-1119. doi:10.1037//0021-9010.86.6.1106Beer, M., & Collins, E. L. (2008). Engstrom Auto Mirror Plant: Motivating in Good Times and Bad. Boston, MA: Harvard Business School.

Newstrom, J. W. (2015). Organizational behavior: human behavior at work (14th ed.). New York, NY: McGraw-Hill.

Olafsen, A. H., Halvari, H., Forest, J., & Deci, E. L. (2015). Show them the money? The role of pay, managerial need support, and justice in a self-determination theory model of intrinsic work motivation. Scandinavian Journal of Psychology, 56(4), 447-457. doi:10.1111/sjop.12211