Foundations of Scholarship: The Petronas Corporation and The Cisco Corporation - Case Study Example

?Foundations of Scholarship Employee engagement is crucial for effective, corporate decision making. Discuss using examples from two global companiesIntroduction Involving employees in a company’s decision-making processes, which is also identified as participative decision-making (PDM), has to do with sharing the function of decision making between the executives as well as workers in the workplace. Corporations can choose to decide on their own variety of employee participation. Employee participation allows for workers to experience greater freedom as well as job satisfaction. It also allows for relations between a company’s senior ranking officials to be able to establish better communication channels with their subordinates. A corporation may have a low or high level of employee involvement in the daily processes that require decision making. Corporations that have a greater degree of employee participation in various functions allow their workers to be able to make decisions about different planning processes. Employees also feel that their opinions are treasured by the company executives, and feel that the company seriously considers their interests. On the other hand, a low level of employee involvement in functions such as decision making is indicative of the existence of a restricted planning process in which only the company’s executives are involved. Advantages of Including Workers in Corporate Decision Making There are many reasons why it is important for company heads to foster a corporate culture in which the opinions of workers are taken seriously (Williamson 2008). While this type of structure has not been popular in the past, it is more considerate of workers and makes them feel appreciated by the corporations they work for. It also encourages loyalty from the workers. Additional reasons why encouraging employee participation in a corporation’s decision-making processes is important are: It improves the employees’ morale: Engaging the staff in the decision-making procedures increases the general morale. Many corporations have a distinctive separation of power between the employees and the management. The implementation of employee participation can successfully reduce this gap; thus encouraging more constructive communication between employees and their supervisors. Once employees are allowed to contribute during decision-making, workers will believe that their ideas are a significant contribution to the company they work for. This empowers them to have the confidence to influence the result of their efforts; thus bringing about increased job satisfaction (Singh 2009). Involving employees in making decisions is also likely to make them more productive. This is because the employees will feel that they have a personal stake in running of the corporation, and thus wish to see their personal contributions bring about the successful realisation of the company’s objectives. The increase in trust that is demonstrated by a corporation’s executives can also inspire employees to expand or advance their skills in order to prove that they are deserving of that trust. Such efforts mean that there will be more effort in production processes which results in more profitability (Scott- Ladd, Travaglione, and Marshall 2006). Improvement in Teamwork- When workers are allowed to contribute towards decision-making, they have the opportunity to state their views while also listening to those of their colleagues. In this way, the workers gain knowledge from each other and thus develop a sense of comradeship that positively affects any joint exercises that may be conducted. Saving Internal Resources- When employees are used in the process of decision making, the company in question has the chance to save on time as well as money that might have been used to hire specialists or consultants. The company will also benefit because it saves money by taking the advice of people who work closely with the machinery and so are in a better position to understand what may be needed. The Practice of Employee Engagement in Two Global Companies In high power distance cultures, the most accepted method of decision-making is the authoritative or autocratic model. In this model, decisions are made, whether in the family, business organisation, or government, by the person in authority (Sagie and Aycan 2003). In businesses which are situated in such cultures, both the employees and managing executives believe that both of these groups of people are existentially unequal, with the managing directors having more authority and status than ordinary workers. This means that the workers of a business in such a culture will accept this status without exhibiting any resentment. In cultures that have a high power distance, workers also feel that they may be punished or summarily dismissed if they disagree with the decisions that are made by the business executives. In low power distance cultures, such fears are not often felt because supervisors and managers encourage the participation of their many workers. In low power distance cultures, the workers of any organisation also have access to more information as it is freely disseminated and not viewed as a privilege for the eyes of the executives only (Luthans 2005). This means that the workers will be in a better position to make decisions since they have a deeper knowledge of the subject in question than their colleagues in high power distance cultures. The workers in corporations that are situated in low power distance cultures also have better access to their top managers; and so can express ideas directly to them on a more frequent basis. The Petronas Corporation in Malaysia The PETRONAS Corporation was officially launched in 1974 in Malaysia. It is a petroleum multinational company that has a presence in more than 30 nations around the world. PETRONAS participates in activities like downstream oil refining, gas processing, gas transmission pipeline operations, petrochemical manufacturing, and property investment. The PETRONAS Corporation is run in a high power distance culture (Parasuraman 2007). The Malaysian culture encourages leaders to be viewed as the main parties in the process of decision-making. Malaysian workers do not feel comfortable in providing their employers with suggestions as they often feel that this is a subversive culture (Parasuraman 2007). The management style embraced by the PETRONAS Corporation is very directive, and has a top-down format. The junior employees to do not know as much about the corporation as the higher ranking executives (Parasuraman 2007). The workers who communicate the concerns of the workforce body are actually elected representatives of the employees. When some employees feel that they are not getting the treatment that they wish for, they are more likely to seek for employment elsewhere than bring up the issue of contention with their supervisors. However, this is slowly changing as PETRONAS endeavours to be more inclusive and sensitive to the needs of its workers (Parasuraman 2007). The reason for the push towards more openness is also due to the hiring of ‘Generation X and Y’ workers. These are young people who were brought up in a relatively westernised society, and are more willing to demand for their rights. Among the older generation of employees, this is causing some amazement. Malaysian society harbours a deep respect people who are older or of high status in organisations. Talking back to or questioning one’s elders was an unheard practice for a very long time in Malaysia. Many managers still feel that these are characteristics that are not suitable for the workplace; and find practices such as the inclusion of the lowest ranking workers in meetings quite a strange practice (Markey 2006). Another reason why there is so much division within the Malaysian society is due to the fact that the three main ethnicities in Malaysian society do not blend well with each other. Many Malaysian workers will go to extreme extents to fulfil the role of the faithful employee in their workplaces. There are small ways in which the PETRONAS Corporation is trying to incorporate the views of its employees in its daily operations (Parasuraman 2007). At present, the management shares information with workers through notice boards, newsletters, and memos. There are newsletters that are published on a weekly basis by the PETRONAS Corporate Affairs Division. The corporation also publishes articles about forthcoming projects, training activities, promotions, corporate values, and special events. Workers will even send articles to the common newsletter. The management ensures that memos regarding any upcoming changes are given to the necessary foremen and supervisors who will in turn communicate about them the employees (Noah 2008). The communication of details is conducted orally, at times. Even though meetings may be conducted as many as five times per week, during these gatherings, the communication is still often top down. When they have concerns that they wish to express to the management, PETRONAS workers usually blog to the human resources director, or their immediate supervisor. This official will then express the concerns to their superiors (Parasuraman 2007). The Cisco Corporation in the United States Cisco Systems is a corporation that is worldwide leader in internet networking. Cisco’s networking solutions are responsible for connecting computing devices, people, and computer networks. This allows people to transfer or access information in spite of differences in where the information is coming from, the time difference that may exist, or variety of computer system. Cisco Systems was launched in 1984 by Leonard and Sandra Bosack, together with three computer scientists studying at Stanford University. It became a public company in 1990. At Cisco, which is located within a low distance power culture, workers are empowered to make both small as well as big changes. Ideas about how to improve the company are sought from employees in different ranks (Li, Tse and Gu 2006). At Cisco, experiential learning is a concept that is emphasised. In this concept, high ranking as well as junior employees participate in resolving Cisco concerns. Another concept put to use by the corporation is the utilisation of “knowledge markets,” -a planned type of crowd-sourcing where solutions to problems are vied against each other in a created “market” so as to establish their effectiveness (Kingir and Mesci 2010). Cisco even permits its staff to use their own technology in fulfilling their tasks in the workplace. Cisco’s strategy of employee engagement has resulted in various benefits via the use of partnership tools. For instance, the organisation’s quarterly meeting has been completely transformed. Not so long ago, Cisco had its gatherings in a physical location, in San Jose, California. Today, they are conducted virtually through collaboration technologies. Cisco workers who may be situated in different parts of the world can take part in these meetings and even exchange ideas with the corporation’s most senior executives through ‘Cisco Jabber®’- which is a live chat technology. The meetings are also recorded and shared with workers who may not have been able to tune in for the meeting. This approach has greatly increased employee participation while ensuring that there is a new setting for comprehensive interactions between Cisco’s senior executives and their many employees. Cisco also offers training offers for employees who wish to get promotions or even become senior officials within the company. Cisco has also ensured that its workers feel that their concerns are taken seriously. At present, Cisco has a high-tech Health Centre that is situated in San Jose for its many workers. Conclusion Employee participation in the process of decision making is of utmost importance if a company is to survive and thrive in the present business scene. Globalisation is a reality that has forced even the most reluctant of companies to embrace the concept of involving workers in more significant activities as a way of remaining productive. Employee involvement allows people to add their own concepts for the benefit of the entire business. Positive change can only take place if the management is able to smooth the progress of employee involvement. References Kingir, S. & Mesci, M. (2010) ‘Factors that affect hotel employees’ motivation the case of Bodrum’, Serbian Journal of Management, vol. 5, no. 1, pp. 59 - 76. Li, L., Tse, C. & Gu., B.Y. (2006) ‘The relationship between strategic planning and entrepreneurial business orientation’, The Chinese Economy, vol. 39, no. 6, pp. 70-82. Luthans, F. (2005) Organisational behaviour, McGraw-Hill Irwin, New York. Markey, R. (2006) ‘The internalisation of representative employee participation and its impact in the Asia Pacific’, Asia Pacific Journal of Human Resources, vol. 44, no. 3, pp. 342- 363 Noah, Y. (2008) ‘A study of worker participation in management decision-making within selected establishments in Lagos, Nigeria’, Journal of Social Science, vol. 17, no. 1, pp. 31-39 Parasuraman, B. (2007) ‘An examination of employee participation in the private sector: Malaysian case studies’, PhD thesis, School of Management and Marketing, University of Wollongong. Sagie, A. & Aycan, Z. (2003) ‘A cross-cultural analysis of participative decision-making in organisations’, Human Relations, vol. 56, no. 4, pp. 453-473. Scott- Ladd, B., Travaglione, A. & Marshall, V. (2006) ‘Causal inferences between participation in decision-making, task attributes, work effort, rewards, job satisfaction and commitment’, Leadership and Organisational development Journal, vol. 2, no. 5, pp. 3999-4414 Singh, S.K.G. (2009) ‘A study on employee participation in decision-making’, Unitar E-Journal, vol. 5, no.1, pp. 20-38. Williamson, M.G. (2008) ‘The effects of expanding employee decision-making on contributions to firm value in an informal reward environment’, Contemporary Accounting Research, vol. 25, no. 4, pp. 1184-1209. Read More