First, thank you for providing some more details about the situation.
Some people are easier to manage than others, it's true. Almost all of us have certain factors that motivate us the most...we vary greatly: more so when we are secure and less so when we struggle to survive. In general, money motivates more when pay is very low.
I feel okay with motivating via money when the person being motivated truly is in control. We are very seldom in control of all the things that contribute to our work, and those things are very often the types that HR can't touch.
I also understand motivation by consequence better than I did before teaching middle schoolers these past two years. I can tell you truly that some people wait until they can feel the consequence before they will act, even in the manner they knew all along was right. Some of my students have required detentions before they would modify behavior, even after warnings. Sometimes this pattern continues into adulthood.
So I usually advise that one behavioral modification approach will not work to solve problems when people's motivations differ.
Let's see...is there no consequence if they do not meet the schedule? Do the assemblers get paid by the piece?
Do certain workers perform the majority of the problems?
I was struck by your claim that Human Resources should be worried about Organizational Environment. What could HR do to improve the way people interact with their processes?
Did having a nice lunch to celebrate an error-free period result in a continued error-free period, or even have a noticeable positive effect? Did it have a positive effect on the more problematic workers?
Can your people be drawn into the behavior modification process through peer pressure? What if you reward according to teams that show an acceptable rate of good quality production? Would the workers pressure each other to stay on task if it meant everyone is linked to everyone's performance?
If the inspection staff is reduced and time-costly problems are resolved, the company would make more money, right? Would the company agree to motivate through rewarding groups with bonuses and higher salaries? Would this also help keep workers from going around the corner? I have posted a free cost of quality calculator in this thread:
http://elsmar.com/Forums/showthread.php?t=13438&page=2
I understand your disapproval of the U.S. corporation running that company as though we are doing you some kind of favor, when in fact there could be a definite patriarchal, authoritative atmosphere that workers find quite depressing. It's not the sort of management style that enjoys high productivity, but a relaxed environment is also not right for all types of people.
Here in Maine, such patriarchal organizations have existed for a long time. Past generations went to their work with stoic, do-well attitudes because they had families to raise and they had few choices. Now that the new generation's mood is "I'll just go down the street and see if it's any better" the businesses generally cry, "The work ethic is dead." Perhaps you are experiencing the same problem.
Before latching onto a unilateral plan for approaching this behavior, if people are simply making decisions to perform in spite of every other need being met by management, I urge you to think deeply about what motivates your people best. It may not be the same thing across the groups, so it may be best to apply a number of approaches as appropriate--but please be sensitive for both positive and negative results!