Human Resource Development: Beak and Johnson - Case Study Example

Name) (Institution) (Tutor’s Name) (Course) (Module) April 30, 2009 Abstract Beaks and Johnston is one of the few companies that is brave enough to experiment with a new organization structure through a cultural and structural change phase. The results have varied in one way or another presenting plus points for the company and challenges also. As a manufacturer, the company has deviated from the norm of manufacturer to increase their production capacity through installation of more machines into training their employees. This is what would be expected of a company operating in the people/labor intensive service industry. On the other hand, the new structure has presented new challenges of integrating the various autonomous teams into one organizational spirit and structure. The new structure has the potential to create some political behaviors among employees of various levels. However, there are various ways of addressing that trend. Although the company sets a good example to others on how to effect change in structure and culture, there are some few areas that the company needs to address such as introducing new team leaders position on a rotational basis in the autonomous teams. Human resource development Beak and Johnson has a very ordered organizational structure. This is best facilitated by the few teams as compared to other large companies have in their operations. This has enabled specialization by teams that have produced excellence in operations. In any given organization, the people factor is very crucial. Jackson and Schuler (p 256) say that risk averse organizations tend to ignore human resource development as the returns on such investments take long. However, he warns that doing so places the company in a competitive disadvantage as in the long term as the innovation capacity of the organization is significantly reduced. Therefore in the case of Beak and Johnson, innovation is thus powered by investing in the human factor of the organization. From the report we see that the employees in the factory floor are well dressed with the right protective clothing and equipment. This in part enables to work well in the low temperatures of 7-8 degrees Celsius that in turn lead to general efficacy of the company. The structuring of the company into several autonomous teams is very well advised. A mechanistic structure of organization as opposed to an organic one is best suited in ensuring that each team works independently and that specialization ensures efficiency and quality. However, Beak and Johnson realizes the disadvantages that are posed by this structure. On one hand, Haas (2007, p 276) and Chang (2006, p 78) say that in such a structure the only relationship that matters is employer-employee. The relationship between the employees and the senior management is based on commands and orders with minimal consultation. He adds that the “the relationship is irradiating and unidirectional from the top downwards” (p 285). However, on the same length, Haas (2007, 285) informs us that an organization can still maintain a mechanistic structure but follow organic principles. A good analysis at Beck and Johnston indicates such a scenario in the organizational structure. Chief operations officer Taylor says that “High-performing workers who habitually operated as individuals became less valued.” In a mechanistic structure, individuality and specialization are encouraged. Teams or individuals are encouraged to compete against one another thus the element of teamwork is almost lost. Challenges of the new structure In such work places also, sabotage, malice and bad blood are common thereby hindering progress and achievement of set objectives by the company. Beak and Johnston has thus been preemptive in recognizing the dangers posed by their autonomous team structure and has thus instituted measures that have eradicated the potential dangers of their mechanistic structure by following organic principles. According to Donaldson (2001, p 37) organic principles call for consultation and advise rather than commands and obeying of orders. Employees are thus empowered to make rational decisions in the work place but not just act as robots in following commands. In the same length, the author argues that strong personalities in the workplace tend to act in a way to assert their authority other than rationality and logic. According to Sarros, Gray, and Densten (2005, p 128), research has shown that such employees are the greatest impediment to change in an organization as they are wary of losing their authority. Therefore, Beak and Johnson had to make the decision of eliminating strong personalities in order to effectively bring about change in the company. As a mater of fact, such a process may involve actual elimination of such employees. The entrance of Woolworths in the Beak and Johnston’s list of customers presented both an opportunity to the company and a challenge as well. In one way, a single customer posses huge potential bargaining power that he can manipulate the seller. However, the idea for Beaks and Johnston was to utilize the opportunity and manage the risk involved to minimal levels to ensure profitability. The company thus figured human resource development would be the best option compared to mechanization of the whole process. This in effect meant that the employees would acquire skills that would serve the large customer the same ways a mechanized system would do only that the employees could also perform other task that a mechanical system cannot perform. Although many authors have identified the people factor as the most challenging aspect of implementing change, the same factor remains a strong point if executed in the best manner. Huber and Glick (149) quote Welch (1990, p31) who says that “heroes and winners will be entire companies that have developed cultures that instead of fearing them relish them.” In developing a strong culture whether within a team or the entire company, Huber and Glick add that “during stable period of business teams must learn and integrate in their culture a means to continually and incrementally improve by getting better and better at those things that offer them a competitive advantage hence the entire firm” (p 151). In the case of Beaks and Johnson, change in the organization would be best achieved with the people factor in a better way than through machines. Huber and Glick (p 154) write that change is a must for organizations that are looking forward to the future and that organizations that do not change in the long run are more likely to fail than organizations that make attempts to adapt to changing business environment. However, in most cases organization may tend to perform dismally at the onset of change as they acclimatize to the new changes but in the long run perform well. In any given organization, the people factor is very complicated in that performance is sometimes hard to measure. While change is a continuous process a snapshot check on the progress may not differentiate the causes and effects or rather whether the effect is unique to the organization or runs across all industries. For instance a snapshot check in the case of Beaks and Johnston while undergoing the current organizational change at a time of the ongoing global financial crisis may not capture the real effects of change as there are other externalities impacting on the company. While it might be hard to capture the actual change brought in by such changes, Jackson and Schuler (p 292) say that working in autonomous teams has its own benefits to an organization. They say that “where employees function in teams, especially autonomous teams and with job rotation, they develop important skills that are highly idiosyncratic to that setting- learning the tasks of other jobs, developing routines unique to that team, learning along to get along with that set of individuals etc”. This enhances better communication among employees and teams with information and skill and innovativeness spreading evenly across all employees. This is what Beaks and Johnson seems to be enjoying at the moment. The company has changed the management philosophy in order to eradicate excessive ego and feel-good attitudes among employees. Beaks and Johnston has undertaken change in two phases. One is indicated as the radical change that involved human resource development instead of increasing production lines and the other one being the gradual one that would see the company increase its value to over A$1 billion mark. According to Lewin’s three phase model on change, Beaks and Johnston has successfully gone through the unfreezing phase by changing the management philosophy. Jackson and Schuler (p 292) say that change in structure or culture in an organization is prompted by either internal or external factors. External factors might be brought about by changes in demand, competition or the type of products in the market being in need of modification. On the other hand, internal factors such as a change in organization objectives, goals and strategy may prompt a change. In most cases, there is the issue of resistance as explained by the fields force theory. Many organizations are faced with the problems of change. There are countless forces that hinder change and propose a status quo. Such a status is what Levin calls need to unfrozen in the unfreezing phase. Anderson (67) says that employees must be symbolically released from previous practices which, although they might have proved successful in the past, must be done away with; they have then to be prepared before the actual change is introduced. As such, change has an additional cost in the transition period. Lewin’s model recognizes that there is the transition period and the desired state. The transition period might be characterized by decreased performance and intensive training on the part of employees before they full adapt to change (Huber and Glick 151). Through the force field theory, management executives are able to identify what might be causing resistance to change and what might in fact be done to enhance proper adoption. Anderson also notes that the resistance forces might be so powerful that they might derail the transition process and return to the status quo. As such, change should be managed with conscious attention in order to help it stick to the system. A flatter organizational structure as the one adopted by Beaks and Johnston reduce promotional opportunities in the management ranks. This may lead to de-motivation among employees (Cohen, D. Kotter, 2005, p 6, Jackson and Schuler p 292). This theory is also supported by Maslow’s hierarchy of needs theory which tends to suggest that motivation arises from one’s needs or ambition. With fewer promotional chance brought about by a flatter organizational structure, there are chances that production in the company may be affected as employees become de-motivated. Mechanistic structure in service industry The current organizational structure at Beaks and Johnson can be compared to the service industry. In one way, the company has adopted a slow but sure approach where quality is not compromised by cultural or structural change. The most significant about the structure adopted by Beaks and Johnson is that it reflects a manufacturing industry where each team is assigned a task whose output is the input of another. Comparing this kind of structure to service industry such as a hotel or insurance company is almost impossible. In most cases, service industries generally serve one product in several stages. It thus becomes impossible to serve one product like in the case of soups and leave out the other. While both are interdependent, the success of a company in a service industry is heavily determined by the success of the company being bale to offer their service as a package (Hall, and Tochterman, 2005, p 170). On another note there has been a lot of criticism of the autonomous teams’ organizational structure due to various reasons. Jackson and Schuler (p 292) identify a team as a group of individuals, who are perceived and distinguish themselves as an integral social entity, working collectively toward a common objective(s), and who administer relationships and interactions across organizational precincts either in a horizontal or vertical manner. These level of independent achieved by these teams my not allow the general cohesiveness of the whole organization. In fact, in the case of Beaks and Johnston a coach who heads an autonomous team might be positioned to enjoy more loyalty from his subjects or members of his team due to the closer and more direct relation and interaction that they have than the senior management. In such a situation, politics might interfere with the smooth operations in that such team leaders or coaches as they are called might use their influence to drive home their personal ambitions at the cost of the company (Leigh et al 2008, p 110). Political implications The organic structure whose principles Beaks and Johnston have adopted in very prone to negative politics in the work place as compared to the mechanistic one according to Donaldson (p 38). In the report, the management is seen to be in a dilemma over how to involve or supervise the activities of the teams. However, coaches and the leadership team do hold business communication sessions to update themselves on the quality levels. Another aspect that exposes the company to a political manipulation within the organization is the fact that quality assessors in the form of coaches seem to have more control as they can over rule decision made by their seniors. This is because their decision on quality are based on data and supported by the quality benchmarks that have been set out by the company. This politicking is a big threat to the new structure, where though it lays emphasis on quality, it encourages employees and more the leadership team and the coaches against each other. This creates an “unfair” climate for making decisions. Future implications Beaks and Johnston has a well established team structure. However, due to the problem of de-motivation brought about by the delayering process which diminishes chances of promotion the company should consider introducing another system where there are team leaders besides coaches. Leadership in each autonomous team should be shared. This ensures that there is cyclical pattern and change where different leaders come forward at diverse times based upon circumstances, errands, and/or group composition. This rotational basis may also be constructed in a way that it allows more than one leader at any given time based upon factors such as the type of errand taking place. For instance, during a promotional event or season, a certain leader may be appointed besides the regular leader. These leaders should be solely appointed on merit and such a position should be remunerated. This will as a result motivate the team members who will see this as a promotion. The current state of affairs has the coach assuming all the leadership responsibilities within each autonomous team who is answerable to the senior management (Leigh et al 2008, p 113). This in fact breeds what the company aims at; removing all employees who habitually act in an individualistic manner. This is possible because the coach bears all the powers over a single autonomous team where according to the company structure, he oversees team activities. Conclusion and recommendations Incorporating a cyclical model of autonomous team development with an interactional model of leadership emergence aptly embeds the leadership emergence and honing process in a natural and vibrant frame. Members signal their prospects for leadership through hard work and team leadership abilities and behaviors emerge. A potential and capable leader is able to elicit influence and motivation among the followers other than commands and authority (Cohen, D. Kotter, 2005, p 6). This type of leadership is a task-oriented one in which interaction oriented leader behaviors are outmoded by task oriented leader behaviors that might influence other members into the same leadership mood. In case of a change in the composition of the team, change in task or another situational issue changes significantly, member expectations for leadership are and thereby representing another cycle of searching for task or otherwise oriented leaders. This thus creates a cyclical process that ensures team cohesion and high productivity of individual teams. References Anderson, D. Organization Development: The Process of Leading Organizational Change, London: SAGE Publications Inc, 2009 Chang, James Business process management systems: strategy and implementation, China: CRC Press, 2006 Cohen, D. Kotter, J. The heart of change field guide: tools and tactics for leading change in your organization, New York: Harvard Business Press, 2005 Donaldson, Lex The contingency theory of organizations, Sydney: SAGE, 2001 Haas, H. The Enterprise in Transition: An Analysis of European and American Practice, London, Routledge, 2003 Hall, Jason and Tochterman, Matthew “Persistence in growth versus market expectations” Australian journal of management, 2005, Vol. 33, No. 1 Huber, G. and Glick, W. Organizational Change and Redesign: Ideas and Insights for Improving Performance, Oxford University Press, 1995 Jackson, R. and Schuler, S. Strategic human resource management, Sydney: Wiley- Blackwell, 1999 Leigh, J., Beatty, J. and Szwed, P. “Team on teams: a collaborative inquiry” Journal of international business studies, 2008, Vol. 5 No. 30 Sarros, J., Gray, J., Densten, I., and Cooper, B. “The organizational culture profile revisited and revised: An Australian perspective”, Australian journal of management 2005, Vol. 30, No. 1 Read More