MCR002 Organisational Behaviour

MCR002 Organisational Behaviour
Class Activity Week-2 Case Worth 1 mark
Instruction: This case is also available on the Moodle page. You have 30 minutes to read and to
prepare your answers for this case. Work with your group members. After the time is over, you will be
asked to answers the questions given at the end of the case study.
ANCOL PTY LTD
Paul Sim was delighted when Ancol Pty Ltd offered him the job of manager at its plant near Shepparton, Victoria.
Sim was happy enough as a supervisor of a small metal plant, but when he was invited to apply for the job of a
plant manager at a leading metal fabrication co. was irresistible. The plant manager position was a valuable first
step in a promising career. One of Sim’s first observations at Ancol’s plant was that relations between employees
and management were strained. He thought he should try to build trust before anything else to improve the
situation. So, he ordered the removal of all time clocks from the plant. Instead, the plant would assume that
employees had put in their full shift. This symbolic gesture, he believed, would establish a new level of credibility
and strengthen relations between management and employees.
Initially, the 250 production employees at the plant appreciated their new freedom. They felt respected and saw
this gesture as a sign of positive change from the new plant manager. Two months later, however, problems
started to appear. A few people began showing up late, leaving early, or take extended lunch breaks. Although
this represented only about 10 percent of the employees, others found the situation unfair. Moreover, the
increased absenteeism levels were beginning to have a noticeable effect on plant productivity. The problem had
to be managed.
Sim asked supervisors to observe and record manually when the employees came or went and to discuss
attendance problems with those abusing their privileges. But the supervisors had no previous experience with
keeping attendance records and many lacked the necessary interpretation skills to discuss the matter with
subordinates. Employees resented the reprimands, so relations with supervisors deteriorated! The additional
responsibility of keeping track of attendance also made it difficult for supervisors to complete their other
responsibilities. After just a few months, Ancol found it necessary to add another supervisor position and reduce
the number of employees assigned to each supervisor.
But the problems did not end there. Without time clocks, the payroll department could not deduct pay for the
amount of time that employees were late. Instead, a letter of reprimand was placed in the employee’s personnel
file. However, this required yet more time and additional skills from the supervisors. Employees did not want
these letters to become a permanent record, so they filed grievances with their trade union. The number of
grievances doubled over six months, which required even more time for both union officials and supervisors to
handle these disputes.
Nine months after removing the time clocks, Paul Sim met with union officials, who agreed that it would be better
to put the time clocks back in. Employee-management relations had deteriorated to below the level they had
been when Sim had started. Supervisors were burnt out from overwork. Productivity had dropped due to poorer
attendance records and increased administrative workloads.
A couple of months after the time clocks were put back in place, Sim attended an operations meeting at Ancol’s
headquarters in Melbourne. During lunch, Sim described the time clock incident to Liam Wu, Ancol’s plant
manager in Christchurch. Wu looked surprised, then laugh quietly. Wu explained that the previous Christchurch
plant manager had done something similar, with similar consequences, six or seven years ago. ‘I guess it’s not
quite like lightning striking in the same place twice,’ said Sim to Wu. ‘But it sure feels like it.’
QUESTIONS:
1. Use the systems theory model to explain what happened when Paul ordered the removal of the time clocks.
2. What changes should occur to minimize the likelihood of these problems being repeated in the future?
(Source: McShane & Travaglione, 2007, OB, McGraw-Hill, Australia, pp 24-25.)