Slade Company is a small but prosperous manufacturer of metal products located in central Michigan. It employs 500 workers who are engaged in producing a large variety of clamps, inserts, knobs and similar items. Despite the success of Slade Company, the manufacturer faces problems in the plating department. The production manager, Ralph Porter, is concerned about dishonesty among employees, abusing the clocking system for logging in the work hours. The typical workweek in the department is 60 hours, with the first 40 hours paid on a straight time basis while additional hours were paid 50% higher (100% higher for weekend work). Typical workdays are from 7.00 to 7.00 pm. Since the supervisors leave around 5 pm, one employee can stay late and punch-out for everyone.
On the surface, the main problem faced by the company is the abuse of the time clock and the unethical behavior of the employees. However, the most significant issue that needs to be resolved in the plating department is how the employees are paid. Pay is considered low for the central Michigan area. Employees typically start a few dollars above minimum wage, with small increases given over time based on seniority and skill. In addition to the low pay, working hours in this department are long. To keep employee training and benefit costs down, the Slade Company practice is to increase overtime rather than hire new employees.
Pay is an extremely important issue not just to the Slade employees but to any employee. The low pay has created an atmosphere promoting the unethical behavior. The employees have developed a “you owe me” attitude. They are intentionally abusing the time clock in order to get what they perceive to be a fair wage. Their actions are also accepted as the norm. The company seems to be overlooking this behavior since the supervisors are leaving before all the work is completed. This action by the company is unacceptable. Higher wages would create a competitive community wage and would reduce the number of hours worked.
To further understand the problem within the company, we also need to understand the existing culture. Different informal groups are formed, characterized by different behavior patterns and by ethnicity. The largest group is Sarto's, which is named after Tony Sarto, an Italian and the most respected member and arbiter. The group is united, with cultural bounds and common social activities. They share the same working conditions, show solidarity and organized a punch out rotation. They operate as a coherent team to increase their productivity during the peak hours, allowing them to maintain a satisfying production output and self-manage their working hours. Henry Clark an Anglo-Saxon acts as the informal leader on his group, which follows Sarto’s behaviors. However, Clark's group does not have Sarto's strong bounds, even though they aspire to. The remainder of the people in the plating department stayed mostly to themselves or associated in pairs or threesomes. The Slade Company management appears to be overlooking the role that group dynamics plays in their operation.
In our textbook, the authors (Robbins and Judge) distinguish between different types of groups. They identify two main types of groups, the formal and the informal. The groups in the Slade Company are informal because they are neither formally structured nor organizationally determined. These groups naturally form within the company because of a need for social contact. For example, the Sarto group often joined in parties and took weekend trips together. These work groups have properties that shape individual behavior and go a long way toward explaining and predicting individual behavior within the group as well as the performance of the group itself. Some of these properties are roles, norms, status, size and cohesiveness. Roles are the...