HBS Case: Treadway Tire Company

Treadway became concerned about costs associated with high turnover of foreman positions in one of its tire plants.  Plant operations were directed by a plant manager several supervisors.  The line foremen worked for the supervisors.  Work expectations were communicated in terms of daily production quotas (called forecasts) and punitive action was taken if quotas were not met.

The results of a survey indicated that the foremen were not trained or prepared for their responsibilities upon assuming the foreman role.  The lack of preparedness led to mishandling of various situations, causing strife with/between hourly workers and lost production time.

The real problem in this case is the use of quotas.  Quotas caused line foreman to delay production line repairs until the next shift so that the next shift would take the production hit.  This behavior meant that the first thing foreman would have to do is take care of “presents” left by the previous shift, thereby delaying the start of the current shift.  Most likely delaying equipment maintainance made the maintainance cost and time increase.  The other problem with quotas is that employees are punished for normal process variations, leaving them feeling helpless to assert control.  The helplessness led to low morale and high turnover.

While foreman training is an issue, the issue of the negative behavior induced by quotas is most likely the primary cause of low morale, high turnover and higher maintainance costs.

Explore posts in the same categories: BADM 720 - Organizational Behavior

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