Summary: The dishonest behavior that the employees of the plating department are engaged in has no negative effects on the desired output of the department. As a result, the Slade management should not be consumed with addressing this issue and consider it a low priority. However, Ralph Porter must consider why employees are forced to fulfill their basic needs outside procedure and address the flaws of a department policy that rewards attendance and discourages productivity.
Sarto Group/Team Norms: Strong, because there is a clear benefit to group membership and individuals do not want to risk exclusion. Norms are explicit and derived by initial patterns.
*Tony Sarto: (effective leader) – superior technical skills
*Motivated: employees take pride in quality – hold themselves accountable
*Mentor system: family tradition – common working approach (free training)
*Tradeoff: (job flexibility for lower pay) – employees are satisfied with arrangement
*Expectations: all group members have an explicit understanding of what is expected of them, and what is intolerable – Herman personifies the anti-group.
Porter’s Five Options:
1.Congratulate Sarto: get pointers for looking at the “big picture”
2.Ignore the problem completely: (at least their not Union)
3.Institute new policies: change compensation arrangements, supervisors stay later
4.Discipline offenders: lowers morale – does not address cause of behavior
5.Make an example: sends the message that behavior will not be tolerated, employees second-guess job security. Tradeoff between lower pay and job security is less appealing.
*Unacceptable Cost of acquiring employees: (training, raise wages to be competitive?)
*Compensation arrangement is flawed: not consistent with company goals.
*Employee morale must remain high: Primary product objective is quality
*Results of behavior: no indication quality or productivity has been compromised
*What more does Porter want? He is being hypocritical in forming his expectations
Porter must consider the characteristics of the labor force available to the Plating Department and understand their motivations. Currently, Slade Co. is not in a position to aggressively attract new employees because of high training costs and uncompetitive wages, so Porter’s should proceed with caution. Volatile production schedules make it difficult to define a workday; employees need to maintain some consistency in compensation to plan for their personal savings and expenses. It is unreasonable to assume, that under the current policy, employees would not address this problem outside procedures because it obstructs their basic needs. The groups have circumvented the blockage to their basic needs in order to move onto more sophisticated needs and greater levels of productivity. Instead of perceiving the ticket punching routine as a negative, Porter should recognize the strong teamwork and problem solving skills required to implement such an organized group routine and nurture them.
Decision: The best course of action for Ralph Porter is to avoid any disruptions that could put company objectives at risk. In order to correct the inequities that exist in the Plating Department he must restructure the compensation arrangement. It could be useful to salary employees and place more emphasis on rewarding the output that the company desires. Incentive-based compensation (bonuses) could be applied to periods of higher output in the business cycle. Through bonuses the company has better control of rewarding behaviors that are most consistent with company goals. A change in the compensation arrangement would realign company, group and individual goals and reduce the need for groups and/or individuals to take a vigilante approach in realizing individual and/or company object.