9.

Employee Involvement
Strategy
Professor Debi S. Saini
(debisaini@mdi.ac.in)
Management Development Institute, Gurgaon

HRM and Employee Involvement

Objectives of this session are to discuss the following:
EI and EP: Historical development & meaning and Aims
Types of EI: Downward & Upward
EI and employee engagement
Company newsletter as a form of downward EI
Team Briefing: Naturemeritsdeterminants of Success
Team working/suggestion scheme/attitude surveys & EI
QCs: Naturemeritsprerequisites; TQM: Naturefeaturesthemes
EI at Delta airlines
Working of EI at global level:

What is Noticeable in People Mgt. Today?

Shift from Taylorism: i.e. indl. revolution model of HR mgt.

Taylorism reflects: ControlDisciplineSanctionsDirection

As in music, even in business there is a Shift to involvement/teams

EI intertwines trust and responsibility

The idea: Help & take others along with you

Employee Participation
and
Involvement: Historical

Economists Sydney & Beatrice Webb in their book Industrial Democracy(1897)

5
talked of industrial governance--But by this they merely meant wage bargain

Salamons Distinctions
Industrial Democracy: Worker control

Employee Participation: Influences decision making

EI: Engagement,

understanding, commitment & contribution

6

EI and EP: Recent Thinking contd

Thatcherism led to Globalization

Japanization in HRM was seen attractive

Shift from Collective bargaining to HRM: EI a key theme

HRM/New IR aim to Build employee commitment

7

How is EI Linked to Japanese Mgt. Practices

Japan exemplary in employee participatory practices
Impact of Confucius: A leadership theorist, stressed
Cooperation and harmony
Social hierarchy through benevolent leader
Leader to act in interest of followers: Young to respect sr.

Export of Japanization to other countries esp. UK

Used partly to water down pluralist UK attitude
Most EI issues relate to small shop-floor concerns

HRM philosophy & Employee Involvement

HRM/excellence movement in 1980s: EI
Tom Peters: People are most valuable asset

HRM: Mgrl. aversion to EP in generalBut EI helps

EI reflects: managerial strategies for productivity

Not for building a participatory society
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Phases & Influence of Forms of Participation in UK

Marxist

Worker
Control

Collective Bargaining
Pluralist

Joint Consultation

Employee
Involvement
Task-Based

Downward Communications

Unitarist

Participation
1900

1920

1940

1960

1980

2000

10

Nature
of
Employee Involvement

11

Meaning of EI and EP
Employee Participation

Refers to state or collective-employee initiatives

in promoting collective representation of employees
in organizational decision-making
possibly in the face of employer resistance
(Hyman & Mason, 1995)
12
EP includes financial participation & profit sharing

Meaning of EI and EP
Employee Involvement

EI is a strategic device used by management

in promoting employee commitment
& the consent/cooperation of the workforce
through information given directly (not reps.)
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Levels of Employee Participation/Involvement

High

High involvement: Complete decision

making power with employees

Medium

Full consultation: Employees offer

recommendations (e.g., QC, Work organization)

Low

Selective consultation: Employees give

information, but dont know the problem
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Forms of Employee Involvement

Formal

Statutory

Direct

Codified practices

Required by law

Employees
personally involved

Example: WCs under

IDA

Example: German
codetermination

Example: Staff vote

against smoking in the
workplace

Informal

Voluntary

Representative

Casual information
exchanges

No legal requirement

Reps decide for

other employees

Example: Boss asks for

ideas

Example: Strategic task

force

Example: Employee
reps as directors
15

Levels of Participation
Worker Directors

Collective Bargaining
Trade Union/Works Councils

Joint Consultative Committees

Task-Based Participation

16

Employee Involvement
&
Engagement:
What Does Research Say?

18

Linkages within High Performance Work Systems

HR Practices &
operating systems
designed & bundled to
enhance:
Ability

Expanded
employee
potential and
increased
discretionary
effort

Improved
company
performance

Motivation
Opportunity
Improved
systemic
response to
employee
effort

Improved
worker
outcomes

Supportive
company, industry
and societal context
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EI and Productivity
Improved
Communication
and Coordination

Employee
Involvement
Intervention

Improved
Productivity
Improved
Motivation

Improved
Capabilities

Cummings & Worley, 8e (c)2005 Thomson/South-Western

15-20

And Engagement?
Engagement represents ;
--a belief in org.s goals, and
--making efforts to operationalize it

But keep in mind that engagement is a strategic issue

that cannot simply be left as employees duty;

it has to be constantly

nurtured
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The Power of Employee Involvement

Customer needs met through employee engagement

Intrinsic desire to control ones work

So EI help promote engagement

EI is crucial for building people-centric culture

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The Power of Employee Involvement

Own the process: Helps build trust/commitment
Inspire and drive the message
Respecting individual

Tap into their imagination, ingenuity, energy

Serve as consultants
Customer needs through employee prospects

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Involved Employees are Committed Employees

Commitment:
1. To be responsible for
2. To pledge (oneself ) to a position
Pride

Integrity

Dedication

Responsibility

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And Engagement?
Engagement is an idea whose time has come.
it represents an aspiration that
employees should
understand, identify & commit themselves
to the objectives of the organisation they work
for..
(however).HR professionals need to recognise
that engagement is a strategic issue
that cannot simply be left to manage itself
(CIPD 2005, 2006)
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Employee Engagement (CIPD 2007)

Opps. For
upward feedback
Feeling
informed
Mgt commitment
to the Org.
Managers
fairness re: issues
Treating employees
With respect

Engagement

Performance

Intention
to Stay
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What Does Evidence Tell Us?

Management control: Involvement on mgt.s terms?

Emphasis on top-down communications unitarist

More communication and consultation far less negotiation

Is management really listening?

Management cultures: is knowledge still power?

28

29

Types of
Employee Involvement

30

Types of Employee Involvement

Downward communicationtop-down
I. In-house journals/company newsletters
II. Team-briefing sessions

Upwards problem-solving forms

III. Team Working
IV. Suggestion schemes & problem-solving groups
V. Attitude surveys
VI. QCs
VII. TQM

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I. Company
Magazine

32

A. Downward Communication (DC)

The company magazine

Common methods of DC in past 20 yrs.

First used by Lever UK (in 1898)

Range: Amateur desk-top by WM to Glossy production

Levers found helpful in new programs e.g.

Used (in 1950) for acceptance of work measurement scheme
Used (in 1953) for job evaluation scheme
In 1990s they used it for flexible & harmonious working

33

II. Team Briefing

34

II. Team Briefing (TB)

Concept of TB
A device to involve everyone in the organization
level by level in face to face meetings
organized by line managers
to present, receive, discuss information
approved by top management
on a regular basis
by providing a two-way communication

Aimed to replace casualism, & inject order in system

It was viewed as productivity breakthrough of 1990s
(Fortune magazine)

35

II. Team Briefing (TB) contd

TB seen as a key ingredient of the new IR and HRM
Changed focus
In 1980s: bad news to convey;
Now: maintain initiative
Organization:
Covers all levels
between 4 to 15 in each gr.
run by immediate leader of gr. at each level
leader be properly trained and briefed

36

II. Team Briefing (TB) contd

Subjects:
Explains new and changed policiesExplaining co. plans
Telling progress in aspects of organizational functioning
People: appointments, personnel matters
Feed back to topProvides for two-way communication

Timing & duration:

At least once a month for inchargesOnce in 2 months for others
But meet only if something to sayDuration be about 20-30 Mnts.
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III. Team Working

38

B. Upward Forms of Communication

III. Team Working

Focuses on problem-solving in a Gr-working situation

Teams vary in size: 7-10

It is a recent initiative in EIoriginated in Japan

Not as widespread as TQM: but its influence spreading

It requires task flexibility & job rotation

Training in: team culture/inter-personal skills/communication

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IV. Suggestion
Schemes

Creative ideas needed

40

IV. Suggestion Schemes

Concept:
A method providing established procedure
for submitting and evaluating ideas
with the aim to recognize those
giving meritorious ideas
without discouraging those
whose ideas are not accepted

41

IV. Suggestion Schemes contd

Features
Suggestion boxes used: Idea is to involve WM in co. progress
--Mgrs/team leaders also encouraged to give suggestions

Going to individual for details of suggestion

Often committee of mgt./WM reviews suggestions

*It decides size of award

*Often has final power to accept/reject suggestions
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V. Attitude Surveys

43

V. Attitude Surveys (AS)

What is an attitude survey?
It is a questionnaire survey of employees
On a one-off or regular basis
Which is designed to discover their views
About a variety of factors connected with work

AS postulates that WM want their views implemented

44

V. Attitude Surveys (AS)

contd

Opinions are taken on a wide range of issues

Job satisfactionjob specificationCo. org. & mgt.

Used by large no. of orgs.

Some use them very regularly: IBM

Enlightened orgs. make imp. changes in policy

Cussons (UK, soap mfrs.) introduced equal opportunity policy
Also, it did training program to tackle employee harassment
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I. Quality Circles

46

VI. Quality Circles

What is a QC:
A voluntary group of employees
holding meetings
to search solutions
for work-related problems
47

VI. Quality Circles

Members usually are from a single deptt., similar work
Usually 6-12 members + supervisor
Member

trained in various skills:

Meetingteam bldg.presentation skills

A QC may be a part of the TQM programme

QC implements its recommendation where practicable
When implemented, QC monitors the process
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VI. Quality Circles

contd

Some basic features of decision-making by QC:

1. Members voluntarily select problems from own-work area

2.

Members collect data, brainstorm, apply problem-solving skills

--Management is frequently invited as expert

3.

A facilitator assists the QC

4. Solutions evaluated for cost-effectiveness; shown to mgt.

49

Merits of QCs
1. Improve communication
2. Increase job satisfaction
3. Stimulate personal growth

4. Increase employees sense of involvement

5. Enhance leadership skills
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VI. Quality Circles

contd

Popular in the 1980s, not as much today

Potentially positive impact on productivity
But incidentally, little effect on satisfaction

Many Problems that led Dilution of Their effectiveness

Inadequate training
Not truly voluntary
Indifference of management
QCs are not really empowered
to make decisions
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Source: www.freequality.org/beta%20freequal/fq%20web%20site/Training/ Classes%20Spring%202002/Quality%20Circles.ppt

VII. Total
Quality
Management

52

VII. Total Quality Management

What is TQM?
It is a concept that presupposes that
Everyone in the organization understands
The expectations of the customer
And they meet customers expectations every time

Based on Presumption of two Achievable Results

Lower the cost of operations

Improve the quality

And thus attract the customer

53

Definition of Total Quality Management contd

A total company wide effort

that includes employees, suppliers & customers

that seeks continuously to improve quality
of products and processes

to meet needs and

expectations of customers
(Dean & Evans, 1994)
54

TQM: Customer Satisfaction is the Driving Force

Strives on customer satisfaction: Internal/external
Voice of customer provides functionality
Quality as customer wants
Planning to deliver as customer wants

Calls for continuous improvement (kaizen)

Which is aimed to satisfy customer
In manufacturing:
Involves checking quality at each stage
55

What TQM is:

Total = Quality involves everyone & all activities in the company.
Quality = Conformance to Requirements (Meeting Customer needs)
Management = Quality can and must be managed.
It is a process for managing quality,
a philosophy of perpetual improvement in everything we do.
It is a method by which mgt. & employees can become involved
in the continuous improvement of production (of goods/services)
It is a combination of quality & mgt. tools
aimed at increasing business & reducing losses
due to wasteful practices.
Some companies well known to have implemented TQM:
Ford Motor Company--Phillips Semiconductor,
Motorola--Toyota Motor Company.

56

What does TQM Pre-suppose?

It is a concept that presupposes that
Everyone in the organization understands
The expectations of the customer
And they meet customers expectations every time

Based on Presumption of two Achievable Results

Lower the cost of operations
Improve the quality delivered

And thus attract the customer

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Features of TQM
Systemic thinking: integrated system of tools/techniques/trng.

Aims to promote attitudinal change

Broad definition of customer concept

Measurement to involvement: US & British
Employee involvementempowerment
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Features of TQM
Routine use of quantitative performance measures
Initially engg. approachelectronic surveillanceteam discussion
Done to assess quality of design (market research, benchmarking)
Corrective action by statistical process control

Belief in kaizen: to achieve zero-defecteliminate waste

59

Features of TQM

contd

TQM requires support of all

Senior management support to drive quality culture
Delegation to middle mgt. project teams (cross-functional)
WM in teams supplying zero-defect good to intl. customers

High trust with external suppliers

JIT & TQM go hand in hand

60

Features of TQM
Systemic thinking: integrated system of tools/techniques/trng.

Aims to promote attitudinal change

Broad definition of customer concept

Measurement to involvement: US & UK
Employee involvementempowerment
61

Features of TQM Contd

Routine use of quantitative performance measures
Initially engg. approachelectronic surveillanceteam discussion
Done to assess quality of design (market research, benchmarking)
Corrective action by statistical process control

Later employee involvement envisaged

Belief in kaizen:
to achieve zero-defecteliminate waste

62

Extended Meaning of TQM

Some companies have intertwined TQM with
employee recognition and care (e.g. QPL in China)
They believe that TQM can work better if

employee needs are taken care of

A happy employee can help
meet quality needs of customer
63

What is Underscored in This Clip?

TQM aims to deliver Quality as per customer needs
QPL Ltd. Believes: Enthused employees deliver zero defect

TQM at QPLis built on the principle of employee recognition

Various needs of employees fulfilled:
From basic to exciting employee needs
AccommodationmealsSportsLeisure

So a joyful org. is seen as part of TQM

64

Working of
Employee Involvement

65

Reality of EI at Global Level: Lessons

Contradiction in mgrs projections & practices
Control is seen in upper realms of the hierarchy
Resistance against power shift to WM (National Pharma)
EP and even EI perceived as a power challenge
Japanese practices possible if workforce is compliant
And, also it works in situation of high-unemployment
66

How To Overcome EI Challenges?

Cultural Differences
EI works better in low power-distance cultures (e.g.Japan)

Management Resistance
Solution: Educate/train managers
to become facilitators

Employee and Union Resistance

Unions see it as dilution of union rights/power
Solution: Promote trust and involvement

67

Working of
Employee Involvement

68

Factors Impacting Working of EI

1. Mgts willingness to concede some prerogatives
2. Training of mgrs/WM in group-working skills
PresentationLeadershipAssertivenessProblem-solving

3. Provision of proper feedback mechanisms

4. Taking action to implement group decisions

5. Realize: Conflict helps developing initiative

69

Reality of EI at Global Level: Lessons

Contradiction in mgrs projections & practices
Control is seen in upper realms of the hierarchy
Resistance against power shift to WM (German Pharma)
EP and even EI perceived as a power challenge
Japanese practices possible if workforce is compliant
And, also it works in situation of high-unemployment
70

How To Overcome Involvement Challenges?

Cultural Differences
Better in collectivist & low power-distance cultures

Management Resistance
Educate/train mgrs to become facilitators

Employee & Union Resistance

Union see it as dilution of union rights/power
Solution : Policies of trust and involvement
71

Working of EI at Global Level: Lesson contd

EI used only for efficiency of organization

Dilemma: how much power to give for creative energy

No undermining of managerial prerogatives tolerated

New technology, TQM, culture change used for control

72

Employee Involvement
In
Delta Airlines

73

Delta Airlines
A successful US airline

Has high level EI programs

It has one of the most advanced EI in the world

74

Delta Air Lines: the 1980s

A top 100 employer
A classic high road non-union firm
There was no EI program initially

Enlightened Paternalism & Velvet Glove Command/Control

Very high employee loyalty
75

Delta Air Lines: the 1990s

Chaotic comptt., turbulent markets, global expansion

New mgt. team:

--Paternalism is out, business partnering in

EI was adopted at first for non-strategic reasons

Has grown into a strategic HRM device: EI

76

part of business model

Delta EI Program: Structure

1. Top-Level: Delta Board Council (one)

2. Middle-Level:
Division Employee Councils (Five)

3. Lower-Level: Base councils (Many)

77

Delta EI Program: Structure

Top-Level: Delta Board Council
Consists of 7 employees: each representing a business Division
Peer selected by employees, 2-year term
DBC attends BOD meetings, meets with CEO, CFO, EVPs
Undertakes Project assignments

Preview employee-sensitive communications/policies of Delta

78

EI Program contd.
Middle-Level: Five Division Employee Councils
Flight Attendant Forum
Technical Operations Council

Airport Customer Service Forum

Cargo Partnership council
Reservations Sales council
These forums consist of employee-elected representatives

Deal with all issues affecting that division

79

EI Program contd.
Lower-Level: Base councils
Elected representatives

Handle base level issues

They form Continuous Improvement Teams

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Costs Invloved
Employee/Management Time

Slower/Constrained Decision Making

Higher Labor Cost

A kind of Unintended Collective Bargaining

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Benefits
Energizes the Employees

Organizational Alignment/Coordination
Production Efficiency/Quality
Communication/ Information Flow

Organizational Change
Management/Employee Development
A proactive way of managing employee relations
82

EI at Delta: Features & Impact

Impacts the Bottom Line
Deals with core Part of Business
Has a Long-Run Focus
Trust and Mutual Gain
Empowerment & Problem-Solving

83

EI at Delta: Features & Impact contd

Management Commitment

Early Bumps

Training as part of corrective measures

Cooperative ER and Union Avoidance

84

What can be learnt from this session?

While EP

is rooted in collectivism, EI is built on individualism

EI contributes to employee engagement

Newsletter & team briefing are imp. form of top-down form of EI

QCs are declining in their effectiveness for various reasons

TQM is becoming more as an EI instrument than control

Effective EI is resisted both by managers & trade unions

EI is likely to be more successful in low power-distance cultures

85