Satellite Auto Glass Case

Sandeep Ghosh

MGMT-614 Managing People in Organization

Safelite Auto Glass Case

Dr. Griffin

Date: 11/06/2015[pic 1]

1. Why was the productivity of the Safelite installer so low?

Problem:

Safelite, was the largest auto glass company in the US. As the demand for mobile services, increased Safelite adopted a strategy to group multiple stores together into “markets” in order to avoid one store competing with another of its own store. The core of the strategy was centralization. Centralizing enabled better tracking and that led to the discover that individual technicians were installing an average of only 2.5 glass units a day(UAD)

Reason:

One of the reason for the low productivity was the reason workers simply did not try very hard. In addition to general low effort there were other factors affecting productivity, such as, finding the correct location of the customer seemed to be one of the main problems. This situation arises because 1) the customer was not present a the location when the technician arrived, 2) the technician was given bad directions, 3)the technician failed to use the directions that were given to him. Between 10 and 20 percent of the time, after reaching the client location the technician would realize that the warehouse had provided wrong parts. In order to get the new parts, rescheduling was needed which lead to reduced productivity and increased cost. Moreover, some customers would simply cancel the order. Finally, technicians complained that the DCC managers tended to assign jobs equitably rather than funneling more jobs to those technicians who worked the fastest.

1. Does the proposed PPP plan address the problems described in question 1? Does it introduce new problems?

PPP Plan:

Performance Pay Plan (PPP) was developed as a means to incentivize high productivity. It would pay the technicians a “piece rate ” for every windshield they installed. Every week the number of installations that were done by a technician would be accumulated and his pay for the week would be based on the number of installations. For the first twelve weeks of the plan, if a technician did not reach a weekly average equal to his previous hourly age, he would receive his hourly wage as a guarantee rate. The only catch to the process was after the first 12 week period however the technicians guarantee rate would be lowered by 30% effectively encouraging him to work towards the PPP rate.