"Bird-Dogging" the Employee

Ace Electronics, Inc is a small company located in Centerville. It is owned and operated by Al Brams, a highly experienced electronics person who founded the company.

Ace's basic product is a walkie-talkie that is sold primarily to the U.S. military. The walkie-talkie units are relatively simple to produce. Ace merely purchase the parts-cables, wires, transistors, and so on-and assembles them with hand tools. Due to this moderate level of company, Ace employs semiskilled workers at low wage rates.

Although Ace has made a profit each year since it started production, Al Brams was becoming increasing concerned. Over the past six years, he had noticed a general decline in employee morale; furthermore, he had observed a decline in his employees' productivity and his company's profit margin.

As a result of his concern, Al asked his supervisors to keep a closer watch on the workers' hour-to-hour activities. In the first week, they discovered two workers in the restroom reading magazines. This "bird-dogging" technique, as management called it, or "slave driving", as the workers called it, failed to increase either production or productivity.

Al recognized that the lack of performance on the part of some employees was affecting the production of everyone. This phenomenon was caused by the balanced assembly line under which the walkie-talkies were assembled. If an employee next to a normally productive employee did not work fast enough, walkie-talkies would back up on the line. Instead of having a backup, however, the assembly line was usually readjusted to the production rate of the slower employees.

In addition, another situation developed to lower productivity and increase unit costs. Ace was required by the government to meet monthly production and delivery schedule. It if failed, a very substantial financial penalty could result. In recent years, the production and delivery schedule had become more difficult to meet. For the last eight months, Al had scheduled overtime to meet the production and delivery schedule and thus avoid the financial penalty. This overtime increased unit production costs and caused another problem. Many employees began to realize that if they worked more slowly at the beginning of the moth, they could receive more overtime at the end of the month. Even the senior employees were slowing down to increase their overtime wages.

Al was very reluctant to fire employees, especially senior employees. Even if he was inclined to do so, it was difficult to catch employees slowing down or provide any reasonable evidence for such a rash action. Al was frustrated and perplexed.

1. Describe in detail the control dilemma at Ace Electronics.

2. Are Al Abrams and the employees getting the same feedback? Why or why not?

3. What should Al do?