Principal-Agent Triangle Model

The principal-agent model exists all over in the workplace. From insurance, which was discussed in class, to retail stores, that model is everywhere. However, not all principal-agent models are bilateral. Some models contain one agent and two principals, creating a triangle of association.

I haven't worked in too many jobs, as my recent posts show. Most of my work experience and interaction come from online interactions with people and communication over certain mediums. But, for an example of a principal-agent triangle model, I turn to my experience working in a factory, which I have also discussed before.

In my first year at the factory, I worked with a few people who went to my high school. We would all work in the same area, except for when one of us was on the machine. The machine in the factory made certain parts that went way faster than if any human put them together individually. When it comes to the machine, it had three different parts, each that required one person to manage it.

Our managers decided that even thought we were new, we should try to master one part of the machine so that more of the experienced workers could handle other tasks. So, one week, they decided to throw us on the machine. This created a conflict of expectations, which ties in to the principal-agent theory.

For this machine, a decent learning curve exists. Even though it is a very repetitive task, the speed of the machine makes it tough to keep up at first. The machine had six slots that would rotate around a circle, and three parts needed to be inserted in certain spots so the machine could pick them up and put them together. Our manager decided to rotate us through the second part, which consisted of us picking up two pieces and putting them in the right spot to get the machine to pick them up.

From the jump, I knew there would be a conflict of expectation. The other two workers assumed that we would be able to keep up enough to consistently churn out plenty of these parts and have the machine stop minimally. However, that was not the case. Early on, when we worked at that spot, the machine would stop constantly. It was evident that the other workers were frustrated with our work, while the managers understood it would take time.

After a couple weeks of continuing struggle to get a hang of the machine, one of the workers went to the managers and suggested that we move to a different part of the machine and move one of there more experienced workers back to the part we were working on. While the managers were hesitant at first, they eventually agreed and placed us on the easy part at times while also working in certain times where a couple of us would work the second station.

This compromise ties in with what we have talked about with team production, and with the paper my team analyzed. The idea is to get maximum efficiency out of your workers, and team production is the best way to gain that efficiency. Also, in the situation with the machine, every worker monitors one another and how efficient and productive they are during that time.