The following report will provide a brief summary of the events involving Thomas D. Bigelow at the Providence Distribution Center.
Fosdick must respond immediately to this behavior and, of course, refuse the food. He should verbally reprimand all employees involved and the document this whole incident. He then needs to contact Jason or Easter to see if they are aware of this practice and if it has been tolerated. It is obvious that this practice is contributing to the Providence distribution center’s elevated shrinkage rate. Once Easter is informed, he will likely support more severe actions for Bigelow’s activities.
Management needs to monitor worker productivity more closely to reduce and hopefully eliminate these situations in the future. Worker conduct and expectations should be explained and reinforced because recently too much has been over-looked and thus become the standard. With regard to pilferage, instituting some security measures, such as package seals or electronic tags, could prevent theft. In addition, the company should install security cameras in problematic areas of the warehouse as having video documentation avoids any debate on behavior. The company could also institute a “whistle-blower” program whereby employees could report theft or pilferage anonymously without fear of reprisal.
Fosdick needs to impress upon his staff that he is their manager, not Bigelow, this long-range step would help him take control of the operations at his warehouse. Fosdick definitely needs to enforce the rules already in place that workers currently disregard. As mentioned previously, video monitoring is another long-range solution to controlling operations. This will not only help to deter and document pilferage, but to discover problem areas in the operation. For instance, if there is a bottleneck in one area of the operation, video monitors will allow the manager to scan other areas of the operation from where they could possibly pull workers to help clear up the bottleneck.
A long-range step that could improve productivity is creating baseline expectations and monitoring employees periodically to ensure they are meeting expected productivity levels. Another way to improve productivity is to create a reward system for achieving or exceeding productivity levels. This system can also be adapted to an Employee of the Week/Month type award; an incentive like this would help with productivity and morale. I think Fosdick should also try to increase output while holding input constant. Clearly, Bigelow’s behavior and the pilferage incident demonstrate that unproductive and destructive activities could have affected Providence’s productivity in the past. If Fosdick enforces rules that prevent this behavior, the potential for increasing output will improve. If less time is wasted, the potential for increased output is much greater. Fosdick should get the final clearance from Easter regarding the Bigelow problem. Bigelow, in essence, controls the warehouse's productivity, and his presence ensures that other workers will accept no major changes unless Bigelow is on-board. Since the warehouse is union-heavy, management should also incorporate productivity measures into the distribution center’s next labor contract.
Once the cause of the shrinkage is determined (pilferage, spoilage or mishandling), we can then develop a course of action. We have already mentioned installing cameras and starting the whistle-blower program, but there are additional options. Fosdick and Easter might also want to establish a shrinkage target into the next labor contract. In addition, Fosdick can increase controls over the inventory to a point where he will know when inventory is lost. Fosdick should hold employees responsible for lost goods. If there is a high rate of shrinkage, but no evidence as to the cause, management should hold workers accountable. If employees are accountable for negligence when a product is missing, they will most likely take more caution in their performance and refrain from engaging in inappropriate behavior, such as pilferage. Another option is to increase the rate of output by employing a new inventory method that will keep goods moving through the system, decreasing the chance of items being lost or stolen.
Assuming Fosdick decides that lunchtime practices must stop, he could inform the union shop steward that employees are stealing and that this is bad for the company. If there are ethics clauses in the union contract, management needs to enforce them. He could urge the union steward to put the workers on notice that pilferage has put the warehouse behind Newburg, and that if these high costs do not improve, their jobs will be in danger. Since employees have failed to ask management’s permission to consume the open cases of food, this is a case of theft. What happens if something that the employees want for lunch is not open? It would not be difficult to “make” it an opened case. What prevents the employees from taking the opened cases home? If they feel it is acceptable to eat these items here, it is not a stretch to think they will want it for home as well. Management could also provide incentives for employees who follow rules against unproductive behavior. If incentives outweigh the urge to be unproductive, it could appease the employees while decreasing shrinkage and improving productivity.
The union shop steward might argue that management has known about the practice from the beginning and, since they never stopped it, they accepted it. If open cases result from handling and not intentional actions, they cannot be shipped to the stores and the food will go to waste. Why not let the employees eat the food rather than disposing of it? Additionally, if the employees can be convinced that Fosdick and management will take steps to reward them for meeting goals and increasing output, there will be no need to resort to the free lunch benefit. If Fosdick sets up a process to reward free lunches, courtesy of him or management, his employees will agree to stricter rules.
If Fosdick communicates his expectations to Bigelow, he may open a dialogue that could lead to compromises between the workforce and management. Since Bigelow is not currently in an actual management capacity, but clearly seen as a leader by his peers, perhaps if he is placed in a pseudo-supervisory position his distance may result in less influence on worker behavior. Furthermore, if employees see Bigelow as management (with Fosdick) this could possibly shift some power back to Fosdick. If Fosdick can find middle ground with Bigelow that provides incentive for him to lead the workforce and achieve better productivity and lower rates of shrinkage, Fosdick can be more relaxed on Bigelow’s unconventional behavior. Fosdick cannot let Bigelow break rules because management will not be able to discipline other employees for breaking those same rules. A man who needs his job to feed his family should not want to risk losing it just because someone he likes got fired for not following work protocols. Fosdick needs to document Bigelow’s actions and should anticipate any decision for corrective action, including dismissal, to be met with resistance. Fosdick may also be forced to terminate a few other employees who purposely impede work before the other employees fall back into line.