TERM PROJECT
LaKendra Adesuyi
Keller Graduate School of Management ~ Devry University

Instructor: Ed Panelli
GM591 ~ Leadership and Organizational Behavior
June 16, 2011

BACKGROUND
ABC Company is a national manufacturing company that provides brake pads, ball joints and other small connecting parts for major car manufacturers. The company has been in business for the past 30 years and has built a solid foundation upon quality above the rest. ABC employs 150 laborers at $8.50 per hour, all healthcare benefits are 50% employee paid, and the company requires 10 hour mandatory work days at 6 day intervals with 1 day of rest in between. In the way of other perks and benefits the company does offer an all inclusive Paid Time Off (PTO) plan that works on an accrual basis of 2 days per month. The facility is located in a rural location where most workers are living below the poverty line and do not typically have cars to get to work.
In April of 2009 ABC began to experience great distress; their quality ratings dropped tremendously and complaints from end users had increased dramatically as recalls skyrocketed due to faulty materials at the hand of ABC. The company was losing money on materials and labor to replace the defective parts. After being threatened with a heavy lawsuit over a fatal car accident Senior Management at ABC decided to take action. Dan Reuthers, CEO of the company began to take note as productivity paled in comparison to the immediate competitors. He had become aware that some well seasoned staff was leaving in great number additionally; new employees were also leaving the company after only several months of training and going to the competition for lower wages. Because of this Dan requested that the Human Resources Department run a turnover and retention report, and the findings were staggering, the report