HBS case on Treadway Tire Company provides an example of a company whose top leadership has it all wrong. Treadway Tire Company, a major supplier of tires, employed approximately 9,000 staff across North America. Their main (and most up to date) plant was housed in Lima, Ohio. The Lima plant was plagued with high turnover from its line foreman (essentially floor/low level supervisors). A new HR person, Ashley Wall, joins the facility and tries to save the company money by determining the root cause of the plant’s turnover problem, which is causing other employees to have low morale.
While Wall’s attempt at finding the cause is commendable, her observations fall short of seeing that the root cause is the system Treadway Tire Co. has in place. Furthermore, her solution is to hire college graduates to fill line foreman and above positions in the future, which doesn’t seem like an effective way to solve the problem of low morale. The system at Treadway Tire Co. is the real problem and until that is fixed, no amount of college graduates or bandaids will solve their turnover problem.
To start, the Lima plant does not properly train their foreman (one would wonder if they properly train any of their employees). Foreman are supposed to be trained by their superiors, General Supervisors, but the General Supervisors assert that they do not have enough time and when they were foreman they had to figure it out for themselves. Thus, the General Supervisors just perpetuate the cycle of low support. A more formalized training was attempted at one point, but the company decided to put the program on hold to cut costs. I’ve said it before and I’ll say it again, if companies do not invest in their top line, their bottom line will always suffer.
Second, the line foreman are given targets that they are expected to meet or exceed, no questions asked. External factors, such as equipment being broken or sick employees are not acceptable reasons for not meeting or exceeding their goal. In fact, as a reminder, a daily report is sent out daily that breaksdown each line area and provides the previous day’s actual performance versus forecasted performance. The audience for this list is all line foremen, general supervisors, area managers, and the plant operating committee. If the foreman fails to meet their goal for whatever reason, they are yelled at and/or threatened with a negative performance review.
These bully tactics trickle down as the foreman take out their frustration/pressure on employees. Line level employees receive the same sort of lashing for making it more difficult for the foreman to reach their goal (e.g. being late from lunch). Though undesirable behaviors due need to be acknowledged, shouting at employees does not seem like a very effective way to get one’s pooint across.
In addition, although line foreman are low level supervisors who are expected to discipline their employees, they do not actually hold power. Line level employees are unionized, whereas line foreman are not; therefore, most line foreman are not familiar with union stipulations. Thus, when the foreman writes up a union employee and the union goes to bat for taht employee, the foreman is not present in the hearing and does not receive an explanation of the decision, which is usually to overturn the foreman’s recommendation. Why would anyone then expect employees to respect the foreman or for the foreman to understand how to work within union stipulations? There is a serious lack of communication and training going on with this scenario.
My final point is that Wall’s implied solution is to hire more college graduates for foreman positions. This is not a solution, it is a bandaid, and not a very good bandaid at that. Rather than further diminishing employee morale by taking away opportunities for career growth within the company, Treadway should work on grooming the people they have to be better employees. With better employees, comes better supervisors in the future. Treadway has serious systemic problems that are not being addressed, and until the company is able to honestly look at itself, turnover and low morale will continue to be an issue.