Engstrom Case Study

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Case Study Memo #1 From: Discussion: Re: Case Memo #1 Motivation: Engstrom Auto Mirror Plant The main problem is a lack of employee motivation. Key issues include a sluggish pace of productivity, poor product quality, employee distrust, questions of fairness, and potential pilfering. Expectancy Theory, Equity Theory, Maslow’s Need Hierarchy, McClelland’s Need Theory, and Herzberg’s Two-Factor Theory help explain how incorrect motivators and organization factors have led to a lack of employee motivation. Expectancy Theory focuses on links between effort, performance and reward. Before the downturn, strong effort leading to greater performance and higher profits and consistent quality was rewarded with good financial outcomes. After the downturn, the same strong effort was met with poor financial rewards. A disconnect between effort and reward decreases motivation as the valence no longer reflects the current effort and subsequent performance. Inequity occurs when the poor financial rewards of workers are benchmarked relative to greater supervisor bonuses. As a consequence, the workers no longer believe the input/outcome ratio is comparable and lose motivation. The company has been incorrectly focusing on Maslow’s physiological needs such as salary and bonuses. Employees are more driven by esteem needs and being rewarded for knowledge, not just productivity. McClelland’s Need Theory addresses the need for affiliation by expressing emotions and developing warm, close, intimate relationships. Although the company attempted to increase affiliation through suggestions and community meetings, following the downturn, issues of distrust and potential pilfering squandered these relationships and subsequent motivation. Lastly, Herzberg’s Two-Factor Theory shows how hygiene factors, if increased, do not lead to exponential increase of motivation. Rather,

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