A Critical Evaluation of the Quality of Employee Relations - Essay Example

? A Critical Evaluation of the Quality of Employee Relations Introduction Quality employee relations can be explained using the systems theory. The systems theory of employee relations has its origins in America. It was developed by Dunlop (1958) in an attempt to make sense of the context of the subject of industrial relations. Using this theory it is possible to provide an account of the many different parts and link them together using the functions each play in keeping the whole system running (Nicholls 2003, pg. 18-19). This report critically asses the quality of employee relations that exist at Coca Cola Company. It will look at the internal arrangement of the company and specifically its Human Resource Management structure and how the company uses levels of relations to improve its productivity and reputation (Budd, 2012). The report will also look at the ethic and culture of the company and the impact of employer-employee relationship in Human Resource Management in the company. Coca Cola was invented on May 8th 1886 in Atlanta USA by Dr John Stitch Pemberton. The formula was patented by Asa Candler when he bought the formula from the inventor. In 1893, it was registered as a trade mark and shortly thereafter could be found in practically all the states in America (Hyman, 1975, pg. 25). Due to Asa Candler’s aggressive marketing techniques by the late 1890s it was one of the most popular drinks in America. At present Coca Cola is present in more than 200 countries and has over 500 brands and 300 beverages. It has an associate employment population of over 92,000 worldwide and net operating revenue of over $31.9 billion (December 31st 2008) Coca Cola is the most recognizable brand in the world today. The use of systems theory in analyzing employee relations has its shortcomings. The concept implies that the subject matter is capable of description while suggesting that the realm of employment is a definite system that exhibits common values that hold it together, hence giving it the appearance of a system (Hyman, 1989, pg 25). It is also argued that to define employee relations strictly in terms of rules and regulations is a very narrow and restrictive. Nevertheless systems theory gives an important framework for describing the context of employee relations. It has created terms that have been accepted in the subject of employee relations. This approach was adopted in United Kingdom by a number of scholars. Clegg (1979) took this concept, contextualized it in the British understanding and came out with a definition. He defines it as the study of rules governing employment and the way rules are formulated, changed and administered (Clegg 1979, pg.1). Therefore; employee relations are the methods of formulating rules and regulations which governs the work place. Employee relationship is the process of managing diversity and change which necessitates maintaining employer-employer relationships that contribute to adequate productivity and motivation. The systems theory avers that there are three main broad areas that constitute employee relations. These are (i) inputs, (ii) processes and (iii) outputs. The inputs have three elements in it. The first being the actors. The actors are represented by the trade unions, management, employee associations and the public bodies mandated to regulate employment (Clegg 1979, pg. 1). The second factor is the context or environment, which is usually complex and dynamic. The workplace is not only affected by the policies and procedures in place there, the internal environment, but also by economic, political and social developments beyond it, the external environment. The last factor is ideology. Industrial relations create a common body of ideas and beliefs regarding the role of the players which in turn helps the system to operate. The outputs are the rules and regulations which are in two parts, substantive and procedural. Substantive part deals with matters like pay, overtime, holidays and the way in which a job should be accomplished. In other words, it deals with substantive matters. The procedural part deals with the manner in which the above substantive laws are crafted, challenges and interpretations (McGovern, Smeaton, and Hill, 2004, 127). Processes refer to the way the above regulations are formulated or drafted. Rules that exist at a work place generally come into being through these mediums. There are rules that have been unilaterally laid down by the employer or management, these are regulations set by the employer arbitrarily. There are also regulations laid to act as a guide to their members at the work place by the trade unions. The National Union of Journalism has an elaborate code of ethics, which regulate what can be promoted or the type of written material to be published. Another way that rules come into existence at the work place is through collective bargaining or joint regulation. This is a whole spectrum of dealings amid employers, directors, trade unions, shop stewards and union members over the interpretation and administration of employment rules (Clegg 1979, pg. 4). The other kind of regulation is statutory regulations, which refer to the rules laid down by the state to govern aspects of employment. Rules and regulations also came into being as a result of customs and practices (Kelly, 2005, pg. 47). Customs and practices concern as to how things have been done previously, and the way the same things are being done at present. Customs and practices are not written down like formal rules but have simply evolved with time There is no single way to gauge the quality of employee relations because quality is both a subjective and relative concept (Weiler 2004, pg.78). This makes it difficult to define quality or good employee relations. In industrialized economies, the term ‘good industrial relations’ has two basic components. A collective bargaining marked by cooperation, joint solution to problems and mutual gain. The second element is human resource Management practices involving participation centered on individual employees (Beamont and Harris 1999, pg.391-392). Employees participation refers to the provision of adequate opportunity to influence and play a major role in making of decisions in an organization. It covers a wide range of techniques which are used on a wide range of issues. Collective bargaining and joint consultations are some of the mechanisms used. This should not be confused with the term employee involvement (Kelly, 1998, pg. 102). Employee involvement is concerned with enhancing the commitment of those employed to the goals of the organization. Employee involvement does not mean sharing power with the management (Kelly, 1998, pg. 47). The decision to accept or reject proposed views lies solely with the employer. In order to deal with the question of quality in employee relations, reference has to be made to the concept a good job. So in order to have quality relations the employee must feel the satisfaction of a good job. There are a number of descriptions of a good job. A good job can be defined as one that entails high levels of skills, great personal freedom at work, adequate representation at work and higher job security (Gallie 2007, pg. 99). Quality of job can be quantified in terms of opportunity for one to use their skills and thus further development. It is also related to the freedom the employees have in determining how work is done, the satisfaction with the available pay and the chances available to have inputs in decision making (Coates 2012, pg.3). In trying to define quality of job, job quality index has been developed by European Trade union. In their definition, they use the following basic standards. These are wages paid; non standard forms of employment working time, conditions availed at work and job security, accessibility to career furtherance through training and collective representation (Leschke, Watt and Finn 2012, pg.5). The International Labour Organization (ILO) defines civilized work as one that is characterized by productive employment, respect of the right of workers and social protection through social dialogue (Weiler, 2004, pg.5). Quality of industrial relations can be understood differently depending on the national or company’s perspective. It can further be defined as the degree to which personnel at the lower levels acts on the issues and policy goals set by those at higher levels (Weiler 2004, pg.10). Since there are good jobs it follows that there must be bad jobs. Clearly, jobs that are of low quality and have no reassurance of security are bad jobs. A job that is insecure and low quality is bad. These bad jobs have the following characteristics. The payment is very low and not adequate, not commensurate with the work done. A job that has no clear system for career development is definitely a bad job. A bad job is one that lacks some or all the ingredients of a good job (Parker and Bevan, 2011). Therefore, the definition of quality depends on one’s perspective and perception of good. This varies from persons to persons and even between various interests (Leat 2007, pg.23). The following are some of the perspectives that can be noted. To a person who subscribes to the pluralistic view will define good employee relations in the following terms. It will mean the existence of effective procedures and processes to solve disputes. It will also entail willingness on the part of the managers to share decision making and conflict resolutions with employees. On the other hand, a person who holds the unitary view will describe the same in a different light. For this person, it will mean first absence of conflict overt or covert, widespread management control and effective use of labour resulting in increased production and higher profits. If the same question is posed to a Marxist the answer, there will be different. A Marxist will view the concept of good employee relations as something of an impossibility since all employee relations is shaped by the economic system which, in these terms. In practical terms, a radical or Marxist perspective would look at the issue of control over the workplace, the workforce and the work process. From all these perspective, it can be noted that there is no clear cut definition of quality of industrial relations. It all depends on one’s perspective, and the view one holds. Different views give prominence to different aspects, which are not necessarily similar. There is no single definition of quality in employee relations since it all depends upon several factors. It depends on one’s definition of employee relations, theoretical perspective of the viewer, other perspectives of the person including personal beliefs opinions and experiences. Employee relations and Human Resource Management are tightly intertwined. This makes Human Resource Management one of the most vital forms of management in any organization or company. Human Resource Management is that part of management method that specifically deals with management of people in work environ. It reiterates that employees are important for an organization to achieve competitive advantage. For a company or organization to achieve optimum results, there has to be proper management of all the company’s resources and specifically its human resources. This is the definition of Human Resource Management according to Bratton and Gold (1999). The Coca Cola Company believes that the connection between employee views and employer relations is an integral part necessary for the success of the organization. Employee relations involve that aspect of work concerned with preservation of employer-employee relations that lead to adequate productivity, hard work and morale. The company believes that for it to achieve its desired goals its employees have to be content with their work. It has been proven that a contented and satisfied worker will have a maximum output at the work place. An employee who is not distracted will work harder and consistently leading to high productivity. A disgruntled employee will not be able to function at optimum level due to distractions which inevitably lead to low productivity. This factor has been recognized by Coca Cola hence the seriousness it takes with its human resource management policies. The company regards its employees as important stakeholders in its affairs. Freeman (1984, 46) defines stakeholders as those persons that can influenced by the accomplishments of a company’s objectives. Apart from the employees the other Coca Cola stakeholders are, the consumers the suppliers, the regulators including government and the local communities. All these categories of people are affected by the policies of the company. In essence at Coca Cola, term employee relation is concerned with the avoidance and resolution of conflicts involving individuals which emanates from the work place. Employees are important and held in high esteem as they are the internal representatives of the organization and therefore, they communicate externally the face of Coca Cola. The policies that have been formulated and implemented at the company are designed to promote commitment to the company, create a sense of attachment and therefore, awareness of its environment leading to an intimate understanding of its dynamic aims. Within the structure of the company corporate message are relayed directly to the employees. This has the resultant effect of making workers stick to the organizational policies. This process gives employees the feeling of having inputs in critical decision making process as their presence is recognized (Beaumont and Harris, 1996, 23). At Coca Cola, there is the system of direct communication between the various managers and employees. This method of communication assists in bridging the hierarchy that is in existence and therefore creates a sense of belonging in the employees to the company. This sense of belonging and respect helps to motivate the employees who reciprocate by willingly promoting awareness and understanding of the corporate brand to other stakeholders. In his strategic approach to Human Resource Management (HRM), Guest (1990) borrows from the Harvard model, which was associated with the softer side of Human Resource Management and the Michigan model which proposes the hard Human Resource Management (HRM) approach. The hard HRM approach is of the view that human resource is basically a factor of production, a necessary expensive commodity of conducting business. This approach does not respect or regard employees as a resource capable of changing unseen factors of production into tangible wealth. In contrast, the soft model gives importance and emphasis on the human factor. It focuses on treatment of employees as vital aspects or assets of competitive advantage, through commitment and high quality output (Legge, 1995, pg.45) The Coca Cola Company has incorporated both models discussed above and come up with a hybrid system. Aspects of both ideas have been molded to the benefit of the company. This can be seen in the choice model adapted by Analoui (2002, pg.30). This model shows a total embrace approach to Human Resource Management. This model represents the strategy with emphasis on HRM being applied by multinationals like Coca Cola. It explains how Human Resource Management policies that are formulated at management levels rely on information acquired from employees and other sources. These policies are then taken to the line management level where they are put into work or implemented ending up at an output level which will impact on individuals, the organization and society ((Edwards, 2007, pg. 35). The effect of this is seen in improved performance and quality of work life. This model is effective as it gives due consideration to the tradition of the organization, the culture and perspective of the employees and other stakeholders. Conclusion This report critically evaluates the management strategies employed by Coca Cola Company. It bases on the nature and management with the emphasis being made on Human Resource Management and Employee relations. It describes how Human Resource Management is essential for corporate image and reputation. Employee relations are important as it covers the whole spectrum of work relationship basically. This includes employer and employee relationship, communication, employee involvement, handling of grievances, health and safety issues, equal opportunities and quality of working life among others. In today’s world in order for employers to remain relevant and competitive they need to overhaul their approach towards employee relations, they need to undertake an in depth review of this subject. Organizations that excel in their business manage to do so because of their application of a coherent set of individuals’ organization (Baldwin, 2006, pg 35). For an organization to be successful there has to be the existence of a constructive relationship with the employees. Management policies should be put in place that encourages employees to develop hence allowing the employer to tap on the full potential of the people. Positive strides have been made in the area of employment relations. People work hard and are enjoying going to work, and they want to learn. For this to be achieved, the relationship between the employer and workers has to be of high quality. Technology and the demand for customized services are shifting managerial focus towards knowledge management and people as their key differentiators. This will require substantial changes in the understanding and behavior of the people who work in organizations (Edwards, 2003, pg. 35). The importance of culture of stakeholders is essential in every organization. In 1999, the company was forced to recall its soft drink products after around 200 people fell ill after consuming its product. These were countries in Western Europe including Belgium, France and Netherlands. Taylor (2002) explains how values are affected by culture in different countries. When the problem of tainted products came up different countries reacted differently. These reactions were dictated by the culture in those places. Culture is defined as consisting of those outlines comparative to deeds and the goods of man’s action that inherited throughout generations independently of the biological genes (Parson, 1949, pg.8)The company had to now change and adopt a local approach to marketing which shows the importance of cultural of cultural needs of customers in local areas. Bibliography Analoui, F (2002) The Changing Patterns of HRM. UK: Ashgate Baldwin, S. (2006) Organisational justice Institute for Employment Studies, Brighton Beaumont, P. and Harris, R. (1996) 'Good industrial relations, joint problem solving and HRM' Industrial Relations Vol. 51, No. 2 Bratton, J. and Gold, J. (1999) Human Resource Management: Theory and Practice. 2nd Ed. London: MacMillan Press. Budd, J. (2012) A (largely pluralist) industrial relations perspective on job quality Unpublished Paper presented at the International Expert Conference on Job Quality, Copenhagen, July 2012 Clegg, H.A. (1979). The changing system of industrial relations in Great Britain Blackwell, Oxford Coats, D. (2012) 'Labour market myths and realities’ in Fabian Society (2012) New forms of Work Fabian Society, London Dunlop, J. (1958) Industrial relations systems Holt, New York Edwards, P. (2003) 'The employment relationship and the field of industrial relations' in Edwards, P. (ed.) Industrial relations: theory and practice 2nd Ed, Wiley, Chichester. Edwards, P. (2007) Justice in the workplace: why it is important and why a new public policy Initiative is needed The Work Foundation, London Freeman, R.E. (1984) Strategic Management: A Stakeholder Approach Boston, MA: Pitman Gallie, D. (2007) 'Production regimes and the quality of employment in Europe' Annual Review Of Sociology Vol. 33 Guest, D. E. (1990) Human resource management and the American dream. Journal of Management Studies, Vol. 27 (4), p. 377-397 Hyman, R. (1975) Industrial relations: a Marxist introduction Macmillan, London Hyman, R. (1989) Strikes 4th ed., Macmillan, Basingstoke Kelly, J., (1998) Rethinking industrial relations: mobilisation, collectivism and long waves Routledge, London Kelly, J. (2005) 'Labour movements and mobilisation' in Ackroyd, S., Batt, R., Thompson, P. And Tolbert, P. (eds.) (2005) Handbook of work and organisations Oxford University Press, Oxford Leat, M. (2007) Exploring employee relations: an international approach 2nd ed., Butterworth- Heinemann. Oxford Leschke, J., Watt, A. and Finn, M. (2012) Job quality in the crisis: an update of the Job Quality Index European Trade Union Institute, Brussels McGovern, P, Smeaton, D. and Hill, S. (2004) 'Bad jobs in Britain' Work and Occupations Vol. 31 Parker, L. and Bevan, S. (2011) Good work and our times: report of the Good Work Commission The Work Foundation, London Weiler, A. (2004) Quality in industrial relations: comparative indicators Office for Official Publications of the European Communities, Luxembourg Read More