Importance of Employee Involvement and Participation in Solving Organizational Conflicts - Research Paper Example

 Importance of Employee Involvement and Participation in Solving Organizational Conflicts Table of Contents I. Introduction ………………………………………………………………. 3 II. General Information on Employee Involvement and Participation …. 4 III. Different Employee Involvement and Participation Techniques ……………………………………………….. 5 IV. Effects of Employee Involvement and Participation in Solving Organizational Conflicts ………………………………………………… 5 V. Other Significant Effects of Employee Involvement and Participation 6 VI. Significance of Reward Systems in terms of Solving Organizational Conflicts ………………………………………………………………….. 8 VII. Challenges Associated with the Implementation of Employee Involvement and Participation …………………………….. 8 VIII. Recommended Ways on Implementing Employee Involvement and Participation ……………………………………………………………… 9 IX. Conclusion ………………………………………………………………. 10 References ……………………………………………………………………….. 11 - 13 Introduction Globalization tightens the competition within the domestic and global markets. To enable a company to increase its competitive advantages against its competitors, a lot of medium- and large companies are forced to restructure and downsize. (Domberger, 1998) For this reason, human resource managers are being challenged to increase the efficiency and productivity of each company’s employees. As part of the most recent human resource strategy, employee involvement has been considered as one of the most important strategy when it comes to increasing a company’s production output efficiency as well as employee’s commitment in attaining the organizational goal and overall financial success of the business. (Bryson, 1999) Basically, increasing a company’s production output contributes a lot of savings in terms of being able to maximize the company’s fixed costs. Eventually, a higher production rate increases the company’s profitability from the sales of products and services. With regards to the practice of employee involvement, several authors have noted that each type of employee involvement technique or a combination of these techniques have different effects on employee’s performance. (Cabrera, Ortega, & Cabrera, 2003; McNabb & Whitfield, 1998) In line with the purpose of this study, HR student will first define the meaning of employee involvement. Given that each type of employee involvement technique or a combination of these techniques have different effects on employee’s performance, there is a need for the HR student to identify and discuss the different types of employee involvement and participation techniques including the significance of reward systems in terms of solving organizational conflicts that could hinder the attainability of organizational goals and objectives. Eventually, the benefits of employee involvement and participation will be thoroughly discussed. Prior to conclusion, the HR student will discuss some of the challenges that human resource managers will be facing when implementing employee involvement and participation including the recommended ways on how human resource managers could implement employee involvement and participation in order to solve organization conflicts. General Information on Employee Involvement and Participation Employee involvement is considered as “the voluntary employer-led initiatives that are designed to encourage more active employee to participate in the business organization.” (Caldwell, 1993) Among the long list of benefits associated with the implementation of employee involvement and participation, Guest, Peccei & Thomas (1993) stated that the main reason for the need to implement employee involvement is to increase the level of employee commitment towards the business organization. In line with the promotion associated with employee involvement or the increase in employees’ participation, human resource managers could effectively provide each employee with an extra role to perform within the business organization. (Langan-Fox et al., 2002) By doing so, the business organization could efficiently make use of its available human resources in order to increase both the company’s productivity as well as its profitability. Different Employee Involvement and Participation Techniques Employee involvement or employee participation is possible through the implementation of a direct job-oriented employee involvement through teamwork or representative form of participation such as allowing a representative employee to actively participate in the decision making of the board of management. (Markey, 2006) Based on the book review of Poutsma (2006) on ‘The Real World of Employee Ownership’ which was origninally written by Logue & Yates (2001), there is a need to hire non-management employees to actively participate in the implementation of employee involvement program for it to work effectively in a company that is employee-owned since participation of non-management employee could effectively provide a non-bias perception with regards to the personal concern of employees as well as the management. Basically, employee involvement can be implemented either with or without incentives extended to employees as a form of reward. According to Levine and Tyson (1990), there is a significant difference in terms of productivity and work satisfaction of employees when employee involvement is implemented within a business organization with or without a reward system. Effects of Employee Involvement and Participation in Solving Organizational Conflicts Upon changing the management or leadership style to a more participative approach (Guest, Peccei, & Thomas, 1993), the implementation of employee involvement and participation could promote open communication among the employees. Basically, allowing a two-way communication between the management and employees could strengthen the flow of business processes as it builds a stronger relationship between the two groups. Communication among employees normally occurs in the form of business meetings or other information communication regardless of whether verbal or nonverbal method is used. Employee involvement or the increase in employee participation can minimize and prevent organizational conflicts. Basically, allowing the low ranking employees to make decisions on behalf of the company can prevent organizational conflicts since most of these employees are in a better position to address certain organizational problems. (Sesil, 2000) For example: Employee who works as an electronic engineer at an electronic company has a better qualification, knowledge and skills when it comes to solving electrical problems more than his/her manager who has no background on electronic engineering. Aside from having a two-way communication between the top management and employees, employee involvement also makes it easier for the leaders to promote team work in order to avoid unnecessary organizational conflicts. Other Significant Effects of Employee Involvement and Participation According to Guest, Peccei & Thomas (1993), the implementation of employee involvement program could not only increase the flow of information within the different ranks in a business organization but also changes the job responsibility of each employee and increases employees’ involvement in the financial aspects of the business. Through trainings and open communication among the employees, the workers will be able to learn more about the business flow which is necessary to the success of the business performance. (Poutsma, 2006) A lot of academic research studies argued that increasing employee involvement within the business organization could increase employees’ empowerment which could eventually lead to the increase in work satisfaction when combined with the provision of intrinsic rewards for work accomplishments. However, it is also argued that increasing the work responsibility of each employee could eventually lead to physical and mental exhaustion rather than an increase in job satisfaction. In line with this matter, the critics and qualitative research study that was conducted by Vidal (2007) concluded that the quantitative result that aims to measure any significant increase in employees’ job satisfaction related to the implementation of employee involvement and participation shows that employee involvement does not necessarily mean that work satisfaction on the part of employees would increase. In fact, increasing the work load among the employees increases the possibility that they would experience the negative physical, mental and health consequences caused by work-related stress. (Murphy, 1995) Over stressed employees could normally result to an increase in poor levels of work performace, more frequent sickness which could lead to an increase in the rate of absenteeism, and dissatisfaction and discontentment in their current job due to lack of motivation. Eventually, all negative consequences of work-related stress could increase the turnover rate of employees. (McHugh, 1998) Significance of Reward Systems in terms of Solving Organizational Conflicts Having effective reward systems together with employee involvement has a significant impact when it comes to solving organizational conflicts. Several studies show that moral hazard and/or non-satisfaction with work is possible when employees are not given any incentives in exchange for the extra work responsibility that is assigned to them. (Sesil, 2000; Ben-Ner & Jones, 1995) There are some business organizations that provide either ‘employee-ownership’ such as employee stock ownership plans, profit-sharing, group-based compensation, and/or individual incentives in the form of bonuses as part of the implementation of employee involvement program. (Kaarsemaker & Poutsma, 2006; Sesil, 2000) However, a reward system that combines both employee-ownership and individual incentives is believed to be the most effective since employees will be rewarded financially as they make important decisions on behalf of the business organization. (Milgrom & Roberts, 1992) Since employees will become motivated in making the financial performance of the business organization more successful, employees often exert extra effort in effectively solving organizational problems and conflicts. Challenges Associated with the Implementation of Employee Involvement and Participation The promotion of employee involvement and participation entails a lot of challenges on the part of the human resource managers in order to make it successful. Despite the fact that employee involvement has already existed during the past couple of decades, the proper evaluation of employee involvement and participation program has not been tackled so much. Based on the article written by Langan-Fox et al. (2002), among the common evaluation methods used in assessing the effectiveness of employee involvement and participation program includes those that are related with: (1) employee attitudes at work i.e. job satisfaction; and (2) measurement in output production. The problem with focusing on this two aspects is the fact that it does not focus on measuring the effectiveness of the implementation methods used by each business organization. For this reason, it becomes difficult to determine the root cause that makes the implementation of employee involvement fail in some organizations. Aside from the lack of sufficient studies with regards to the proper implementation of employee involvement, another important challenge associated with the implementation of employee involvement program is the possibility that the use of profit-sharing scheme could promote ‘free-ride’ culture within the business organization in the sense that some employee may simply choose to allow their co-workers to do as much work responsibility as they could. (Sesil, 2000) Recommended Ways on Implementing Employee Involvement and Participation According to Leana, Ahlbrandt & Murrel (1992), human resource managers should be able to effectively promote job satisfaction as well as employees’ commitment to the business organization to make employee involvement and participation possible. Given that reward system such as the use of profit-sharing scheme could promote ‘free-ride’ culture within the working environment, the human resource manager should carefully identify the pros and cons of each type of incentive applied with employee involvement program. Human resource managers should also be able to identify and clearly state the decision control as well as the control over the work process given to each employee in order to avoid possible future organizational conflicts. Basically, the degree of work control extended to each employee should be based on each employee’s knowledge, skills and other work-related qualifications. In other words, the ability of the human resource manager to combine the work performance incentives with the degree of work control over the work processes will enable the leaders to prevent both work dissatisfaction on the part of competitive workers since the development of a ‘free-ride’ culture will be avoided. Conclusion The implementation of employee involvement can be effective in solving organizational conflicts since this type of program can promote teamwork among the employees. In order to make the implementation of employee involvement more effective, human resource managers should be able to develop a reward system that is based on the main concerns of the business organization. Aside from being able to address the challenges associated with the implementation of employee involvement, human resource managers should carefully identify and study the benefits and consequences of each type of work incentives in order to prevent further organizational problems and conflicts. *** End *** References: Ben-Ner, A., & Jones, D. (1995). Employee Participation, Ownership, and Productivity: A Theoretical Framework. In Sesil J.C. (ed) 'Sharing Decision-Making and Group Incentives: The Impact on Performance' Economic and Industrial Democracy. 2006. 27(4):587 - 607. Bryson, A. (1999). 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