Engstorn Auto Mirror Plant Case

This case focuses on David Sokol, an executive who has made a “name” for himself in recent years within the energy industries. After becoming recognized as a successful “turnaround” agent for troubled companies, Sokol was hired in 1992 to serve as the chief operating officer of JWP, Inc., a large, New York-based conglomerate. At the time, JWP had an impressive history of sustained profits and revenue growth that was being threatened by the company’s far-flung operations and unwieldy organizational structure. Unknown to Sokol, JWP’s impressive operating results over the prior few years had been embellished by the company’s

Harvard Business Review case, The Nuclear Tube Assembly Room, is an excellent example of how managing and leading a team effectively can make a substantial difference in terms of results and goals achieved, all the while creating new ambitious expectations for workers. This particular case revolves around Ralph Langley, general foreman of the process department at American Radiotronics Corporation. Within the first 24 months of being promoted to general foreman, Langley has swiftly changed the mentality and efficiency of the workers in the nuclear tube assembly room. He has changed their terrible reputation into one of the most

In order to appropriately recommend an incentive plan, one must first identify the main issues with operation at Howe 2 ski. Howe 2 Ski has experience increased competition resulting in a decreased market share. Smaller market share increases the negative impact a lack of productivity and customer dissatisfaction has on Howe 2 Ski’s profits. The decreased production of both the molders and Sales-Persons result in increased inventory and higher cost of production. Furthermore, Howe has attempted to establish an incentive pay program that has served to be ineffective and has fostered low morale within the organization.

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.

Correct :The Scanlon, Rucker, and Improshare plans combine leadership, workforce education, and employee participation with a reward system linked to group or organization performance.

The use of the competing values framework was demonstrated through Ralph Langley’s management style. He leveraged the four distinct models collaboratively as he led the production staff of the nuclear assembly room. His management approach help lead to the following: an increase in profits for the tube manufacturing operations, team cohesiveness amongst the production staff, individual ownership and problem solving during the production process, staff pride in meeting production goals and deadlines, and respect as well as admiration for management in the assembly room. The current positive direction of the nuclear assembly room staff under Langley’s leadership was in contrast to the department two years prior to him assuming the role as general foreman. It can be concluded that Langley displayed mastery of the competing values framework within the scope of his role as general foreman for the assembly room at American Radiatronics. He was able to develop a word class staff that was able to work as a team to accomplish the goals of the production unit and the company.

The Engstrom Auto Mirror plant is located in Richmond, Indiana and employs around 200 or more people. The plant has been going through some changes over the last few years and has seen a decline in employee motivation. The focus today will be to determine some of the root causes of the problems facing the plant from an organizational view and a human behavior issue. The bottom line is determining how to solve the issues the company is facing and move forward. Some of the questions that will need to be answered is, “why is motivation at an all-time low, is the Scanlon plan benefiting everyone in the company and can the plan be revamped with

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

Joe Hinrichs, a recent Harvard Business school graduate, was hired in February 1996 to run the General Motors’s the Fredericksburg Torque Converter Clutch (TCC) manufacturing plant. At 29 years old, Hinrichs was GM’s youngest plant manager. Hinrichs was inheriting a poor performing plant that continually underachieved, losing money year after year. Improvements were desperately needed to increase the efficiency of the manufacturing process and reduce operating costs. GM had considered shutting down the plant; however, when a new bonding process, using carbon fiber, for the TCC was approved in 1995, GM instead invested thirty million dollars into the Fredericksburg plant to incorporate the new process.

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

Engstrom Auto Mirror Plant is facing an internal crisis which primarily is a motivational problem. Ron Bent, the manager, and Joe Haley the assistant has seen workplace culture and productivity decline over the years. Ron joined the company when it was going through a similar issue in the past. He came and implemented an employee incentive program which is general across the United States. The incentive program called Scanlon Plan was originally very effective in employee motivation and increasing productivity at Engstrom, but it is now failing.

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

The vision of Cooper Industries, as stated in the case, was to do an ‘outstanding job at the unglamorous part by making necessary products of exceptional quality.’ The goal was to operate in industries that had become somewhat of a necessity for consumers. Examples of such industries include: power transmission, hand tools, drilling and others. Cooper industries had started in 1833, as an iron foundry, and had existed most of its 150 years as a small sized maker of engines and compressors. However, all this changed in the 1960s, when the management decided to expand the company to lessen its dependence on the capital expenditures of the cyclical natural gas business.

We believe the new incentive system was needed and reasonable because the accounting-based incentive system, where EPS was a measure of performance, raised valid concerns. The first being an agency problem. This existed within the old system as manager’s interests were not aligned with those of stockholders. EPS had improved steadily at a rate of 9% annually; however, the share price had increased only slightly in comparison. Therefore, the company’s stockholders had hardly benefited. The second issue was the use of subjectivity in granting bonus awards. These awards were given out even when their entity had not performed well. Managers began “politicking”, meaning they would try and convince their evaluators they performed better than the results had shown.

In the end, however, Holland puts most of the blame for the industry’s decline on government policy. He targets tax laws and macroeconomic policies that encourage LBOs and speculation instead of productive investment. He also criticizes Pentagon procurement policies for favoring exotic, custom machines over standard, low-cost models. This adds up to an industrial policy, Holland writes—a bad one.