When examining Delphi’s organizational culture and structure, we identified two main areas of concern: a lack of individual employee motivation and a need for leadership improvements. Employee apathy has been caused by a lack of external motivators, the belief that rewards aren’t linked to performance and the perception of limited organizational support. Leadership issues stem from the leader-member relationships in the organization, which are not as positive as they could be due to decreased trust and limited communication. Additionally, Delphi suffers from employee perceptions of unethical leadership.
In order to deal with the issue of motivation, we recommend gainsharing, which increases cooperation, accounts for external influences and makes each employee feel that their individual contribution is valued. Another way to improve motivation is to link rewards to performance by explicitly communicating expectations and reward criteria to employees and creating numerical forms to increase performance review consistency. Lastly, addressing the discrepancies between employee pay cuts and executive bonuses will make employees feel more supported by Delphi, which will translate into increased motivation and performance. To improve Delphi’s leadership, two specific training programs must be created. The first should be aimed at teaching managers how to create trusting high-quality leader-member exchanges, so that employee in-group membership increases. In-group members experience higher job satisfaction and lower levels of felt inequity and will provide many positive organizational benefits. The second training program should be aimed at promoting ethical behaviours so that employees and managers are better equipped to deal with ethical dilemmas in the workplace. By implementing the above-mentioned changes, Delphi will create more efficient and productive employees. In turn, this increased efficiency and productivity will help to achieve Delphi’s ultimate goal of improved financial success. INTRODUCTION
Delphi Corporation has been struggling ever since it`s spin-off from General Motors in 1999, with recorded financial losses for eight of their nine years of autonomous operation. As consultants working to improve Delphi’s financial situation, our objective is clear: identify main areas of concern and use creativity and logic to create recommendations on how to deal with these issues. More specifically, we hope to provide Delphi with a comprehensive understanding of how their individual and group issues are stopping the company from moving forward as an organization. Additionally, this report will identify several changes that Delphi can implement in order to address the specific issues that we discovered, while also improving their overall effectiveness as a company. COMPANY OVERVIEW
Delphi Corporation is one of the largest automotive parts companies in the world. It became a fully independent company on May 28th 1999, under the name of Delphi Automotive Systems with headquarters in Troy, Michigan, USA. Although initially formed by General Motors as a separate business sector, its’ parent company decided that it was too expensive to create its own auto-parts and that it would be less costly to do what other companies had been doing for years: rely on worldwide, cheaper parts makers. J. Battenberg III, chairman, chief executive officer and president of Delphi at the time, said that “pension plans will be fully funded, and health-care and other benefits of Delphi’s current employees will be continued”. He also said that they would maintain high-level collaboration with the leadership of UAW (United Auto Workers) in order to preserve their good relationship and protect the interest of employees that were affected by the change.
In 2001, the company had a net loss of 370 million dollars and, as a result, Delphi announced a cut of 11,500 jobs, with 1,400 more jobs being cut in December of...