Conifer Corp is a sawmill operation in Oregon, that is owned by a major forest products company, but operates independently of headquarters. The mill is divided into six operating departments: boom, sawmill, planer, packaging, shipping, and maintenance. It won packaging quality awards over the past few years, but product quality has recently fallen and customers have switched to other producers. The planing and sawmilling departments have significantly increased productivity over the past couple of years, whereas the packaging department has decreased productivity. This has resulted in a backlog of finished product, adding to Conifer’s inventory costs and the risk of damaged stock. The company pays packaging employees overtime to complete the work on Saturdays. The packaging department extends its lunch and coffee breaks, and usually leaves work early. The packaging department is located in a separate building from the others and has no supervisor.

1. What symptom(s) in this case suggest that something has gone wrong?

2. What are the main causes of these symptoms?

3. What actions should executives take to correct these problems?