Types of Employee Participation - Essay Example

Do employee involvement/employee participation and related practices make a significant impact in the workplace? Introduction Over the past two decades, economies all around the globe have undergone tremendous changes characterised with widespread application of information technologies, deregulation of global market activities, decline of huge manufacturing industries, growth of service industries, and mounting global competition in the goods and services industry. Frequent trend changes in product and services markets combined with growing quality concerns force employers to develop more efficient and flexible methods of production. The composition and practices of the workforce have been changing due to those increasing quality concerns and other societal shifts. Decline in trade union membership and activities is the most obvious change occurred in workforce. In addition, employers are trying to make their workforce increasingly qualified by employing university and college educated fresh candidates. A particular focus is also given to part-time and other flexible forms of labour. In the view of a scholar, “intellectual capital - not natural resources, machinery, or even financial capital - has become the one indispensable asset of corporations” (Crainer 2006, p. 269). In order to keep pace with the changing economic environment, marketers give prime focus to their workforce and hence they promote employee participation. This paper will evaluate how employee involvement/participation influences the workplace and management strategies to enhance employee participation. Employee participation: an overview Under the concept of employee participation/involvement, each employee is considered as a unique human being involved in achieving the organisation’s short term as well as long term goals. In other words, each employee’s contribution is separately valued by his/her management. According to Secord, “employee involvement is commonly defined as a range of processes designed to engage the support, understanding, and optimum contribution of all employees in an organisation and their commitment of its objectives” (Secord 2003, p. 231). The term employee involvement is a broad term, and it embraces several processes and arrangements performed between employers and employees. The term employee participation is interchangeably used with the term employee involvement. However, there is a slight difference between these two terms. As Secord (p. 231) says, the term employee participation represents an employee’s involvement in management decision making whereas the practice of employee involvement barely affects organisational decision making. As Jackson et al. (2011, p. 465) note, in order to improve employee participation, employees are allowed to take part in group discussions by which job performance and overall organisational productivity could also be improved. In addition, employers like to keep their employees informed about various economic and market factors affecting the employee performance. Furthermore, employees are kept informed about the current financial status as well as market position of the organisation. In times of policy changes or organisational restructuring, specific attention is paid to employees’ views and opinions because low level employee involvement would limit the scope of such changes. The employee participation concept allows employees to influence the management’s operational policies regarding production or service delivery (Apostolou 2000). Finally, employees are able to influence the conditions of employment including safety and remuneration where employee participation is ensured. Types of employee participation There are three main employee involvement techniques such as direct, indirect, and financial (Martin et al. 2002, p. 227). Each of these employee involvement mechanisms would be preferable at distinct organisational contexts. Under direct employee involvement, employees are allowed to directly involve in matters that affect them. For instance, employees are directly involved in making decisions relating to job remuneration and worksite safety. Management experts claim that direct employee involvement is necessary to implement an organisational change successfully because such a practice is more likely to affect employees directly. In addition, direct employee involvement in an organisational change process would assist the management to avoid employee resistance to change to a great extent. Quality circles can have a high level of employee involvement and influence on workplace related decisions (Holden 2001). In contrast to direct employee involvement, sometimes employees are involved in the decision making process through representatives under indirect employee involvement (Collins 2000. p.236). Sometimes, indirect involvement can include two mechanisms such as representative and union based involvement. Under the indirect involvement technique, employees communicate with the management and address their needs and suggestions through representatives or union leaders. Many authors believe that the technique of indirect employee involvement can be used at decentralised workplace settings. It must be noted that the indirect employee involvement would not be effective unless high level management and employees commitment is ensured. Today, many management experts are of the view that this mechanism would often fail to achieve desired benefits of employee involvement. Under the financial employee involvement concept, employees are offered a financial stake in order to make them more responsible for the economic success of the organisation (employee financial involvement). The major objective of this employee involvement approach is to improve the overall organisational performance and hence the financial rewards available to employees. A number of profit sharing mechanisms have also been developed to enable employees to share the economic prosperity of their organisation (Farnham 2000. p.183). Many management professionals strongly argue that financial employee involvement is the most effective management approach capable of improving the overall organisational productivity and thereby profitability. It is identified that today’ business managements increasingly focus on this employee involvement strategy because the level of uncertainty is very high in the current market environment. Impacts of employee participation on the workplace In their paper The meaning and purpose of employee voice, Dundon et al. (n. d.) relate the term employee voice to employee involvement/participation. The authors argue that the provision of employee voice can have a more significant impact on employee commitment than the remuneration. Therefore, modern business managements are giving prime focus to ways that would improve employee voice in the organisation (ibid). MacCabe and Lewin point that the term employee voice is composed of two major elements; first is the expression of grievances or dissatisfactions in a workplace environment by employees to management; and second is the participation of employees in the management decision making process (ibid). These two elements give employees a feeling that they are an integral part of the organisation and hence they have a key role to play in driving the firm to greater heights. Undoubtedly, such a feeling can have dramatic impacts on employee performance and hence the overall organisational productivity. In the opinion of Potocki and Brocato (1995), under an organisational environment where employee involvement is high, employees can easily present their views to the management. This situation would greatly assist the top management to identify worksite problems at various organisational levels and thereby develop improved strategic measures to curb the identified issues. Management studies have found that many employee discrimination or other worksite malpractices go unreported due to several reasons. However, increased employee involvement/participation would benefit the management to identify those workplace issues that are likely to impede the economic growth of the organisation. In addition, this approach is beneficial for the organisation to identify and resolve human capital needs properly. Many top management executives say that effective employee participation is assistable for an organisation to take potential operational decisions because employees may be more familiar with day to day operations of the firm (Gallagher 2002). They also add that many employees are very thoughtful and creative, and they can assist the top management in different crucial situations. However, innate skills and potentials of low grade employees often go unutilised due to lack of employee participation. Increased organisational flexibility is one of the major benefits employee participation (Poustma 2001). Today, majority of the large scale organisations tend to improve all forms of flexibility in industry in order to confront with growing competitive pressures. Experts like Summers & Hyman (2005) suggest that employee participation in the form of performance and profit related pay schemes have greatly assisted business firms to loosen wage rigidity and to promote labour market flexibility. Another notable impact of employee participation is that this approach can greatly influence employee attitudes and behaviour and thereby improve the overall performance of the company (Rizwan et al. 2011). Many conventional management theories claim that employee behaviour can have great influence on the company performance. Authors like Pendleton et al reflect that when the level of employee involvement is sufficient to give the ‘feeling of ownership’, higher levels of job commitment and employee satisfaction can be achieved (Summers & Hyman 2005). Job commitment and satisfaction are the key factors contributing to the overall organisational productivity (Lumley et al. 2011). It must be noted that the level of participation which is needed to produce the feeling of ownership may vary from industry to industry. When an employee gets the feeling of ownership, s/he would be very cautious in his work and try to minimise production errors or material wastage. Hence, better employee participation will certainly assist the firm to cut down its operating costs and thereby improve its overall financial status. The view that employee participation can cut down production costs is fully supported by the National Bureau of Economic Research (NBER, n. d.). Theorists like Sarkar (n. d.) argue that under the combined influence of governmental measures and management approaches that focus on individual contribution and rewards, collectivist orientations are likely to shift to individualistic orientations. In the words of Summers and Hyman, since employee attitudes are significantly influenced by both external and internal climates, they (employee attitudes) can be really receptive to unitarist approaches. Hence, if employees transform their collectivist attitudes to individualistic attitudes, unitarist cultures practiced by many firms are more likely to be welcomed. Management experts claim that high level employee participation is a potential way to abolish employee resistance to management initiatives (O’Donnell & Boyle 2008). Therefore, this concept is fruitful to eliminate unproductive work time and unnecessary expenses, and consequently, it contributes to the scope of rapid business expansion. Some management professionals opine that effective employee participation would result in the formation of a harmonious labour relations worksite environment. They hold the view that this approach can be used as a tool to improve employment relations in an organisation and thereby benefit both the parties (employer and employees). In fact, evidences suggest that there is no clear connection between employee participation and improvement of employment relations. It is argued that sometimes employee participation may cause worker dissatisfaction and fuel worksite conflicts in the firm. However, some management executives report that the concept of employee involvement has assisted their organisations to minimise worksite conflicts. It is observed that employee participation would enhance team working, which in turn has a positive impact on employees in terms of improved relations, conflict handling, behaviour changes, building trust, and improving interpersonal communications. By ensuring employee participation and effective team working, it is easy to align employee norms with organisational values. “Once employee values and motivations are in concert with management and organisational objectives, it is assumed that employee will then work ‘harder and better’ than before, thus resulting in improved organisational performance” (Summers & Hyman 2005). Many other studies have proved that team working is an effective measure to reduce worksite stress and hence to promote job enjoyment. In addition, team works is better to develop innovative ideas, which in turn would benefit the organisation to enter the next phase of growth. Empirical evidences also suggest that employee participation approach would make workers willing to contribute voluntarily to the firm’s improved performance. To illustrate, a study conducted by Roche and Geary at the Irish Airports Authority reflects that employee participation produces a positive outcome for both the employer and employees. Apple, Inc has been successfully practicing the employee participation approach in order to maintain its operational competitiveness (Imberman 1993). How to promote employee participation? In order to increase employee involvement, it is necessary to keep the employees motivated. There are several management approaches intended to enhance employee participation in organisational activities. It is identified that financial rewards or incentives can influence most of the workers whereas some others would respond more positively to additional duties and responsibilities. Hence, a leader/manager must identify which motivational strategy would influence each employee. In addition to deploying motivational strategies, a manager has to ensure employee participation as well. In order for improving employee involvement, the business manager should foster mutual respect and open communication between his/her workers (Jablin & Putnam 2000, p. 669). This strategy would build interpersonal relationships among employees. Once a healthy worksite environment is established, the manager has to encourage ownership of decisions. Then, he/she must enhance employee learning and training so as to empower the employee for personal and organisational success. It is essential to choose group leaders from employees because there is a proved linkage between team work and employee participation. For this, the manager must recognise people who are efficient in terms of handling responsibilities and maintaining accountability. The manager must specifically make certain that employee concerns and questions are adequately addressed. Positive reinforcement is a potential strategy to increase the likelihood of better employee participation (Babb, n. d.). As part of this approach, the manger should continuously monitor workers to identify if anyone has performed extraordinary things deserving recognition. If found so, the manager has to reward the employee in way that would influence him/her extremely. It is advisable for the mangers to find enough time to listen to employees’ queries and to resolve their problems that affect their work performance. While resolving employee problems, the leader must give specific attention to their suggestions. Before decision making, it is better to ask for input from people who are affected by the decision. This practice is beneficial for the formation a sound decision based on complete information. Providing information and feedbacks in a timely manner would benefit the organisation to build a loyal and more involved workforce because such a practice would give employees a feeling of ownership. It is recommendable for firms to avoid under and over management because those improper management practices would negatively affect employment relations. Under an environment of over management, people do not get adequate freedom to apply their creativity to work. Therefore, this management approach will never foster employee empowerment. Similarly, an under managed organisational environment would fail to provide employees with accurate, complete, and useful information. Finally, it is recommendable for companies to eliminate worksite discrimination on the ground of religion, race, sex, or nationality because this issue can have a very negative impact on employee participation. Conclusion From the above discussion, it is clear that employee involvement/participation has a significant influence on the workplace. The employee involvement can be direct, indirect, or financial depending on the employees’ interests in organisational affairs. Employee participation approach can influence employee attitudes, and hence it is helpful for the organisation to align its employee norms with organisational values. This concept greatly assists firms to increase employee commitment and to build a loyal group of workforce. Evidences suggest that better employee participation benefits the management to form sound business decisions in crucial times and to identify dangerous problems such as employee discrimination existing in the worksite environment. This HR approach is a potential tool to eliminate employee resistance to new management initiatives because employee participation promotes strong employment relations. References Apostolou. A. 2000. “Employee involvement. Report produced for the EC funded project, INNOREGIO: dissemination of innovation and knowledge management techniques”. D. of Production Engineering & Management Technical   University  of Crete, january. pp-1-22. [online] Available at http://www.urenio.org/tools/en/employee_involvement.pdf Accessed 13 Nov 2012 Babb, B. (n. d.). 6 Leadership actions to enhance positive employee involvement. [Online] Available at http://www.paradigmassociates.us/resources/articles/LeadershiptoEnhanceEmployeeInvolvement.php Accessed 13 Nov 2012. Crainer, S. 2006. The Ultimate Business Library: The Greatest Books That Made Management. John Wiley & Sons. US. Secord, H. 2003. Implementing Best Practices in Human Resources Management. CCH Canadian Limited. Canada. Collins, D. V. 2000. Management Fads and Buzzwords: Critical-Practical Perspectives. Routledge. US. Dundon, T. Wilkinson, A. et al. 2004. ‘The meaning and purpose of employee voice’ International Journal of Human Resource Management, 15: 6. September. Farnham, D. 2000. Employee Relations in Context. CIPD Publishing. London. Gallagher, T. J. 2002. “Employee Participation in Decision Making in Extension: A Ladder of Participation to Reduce Cynicism”. Journal of extension, 40 (5). Holden, L. 2001. Chapter 13: Employee involvement and empowerment, In "Human resource management: a contemporary approach", Editors Beardswell, Ian and Holden, Len, Pearson Education Limited, Harlow, pp.559-597. IBEC. Employee financial involvement [online] Available at http://www.ibec.ie/IBEC/ES.nsf/vPages/HR_best_practice~Reward_and_benefits~employee-financial-involvement?OpenDocument Accessed 13 Nov 2012. Imberman, W. 1993. “Employee Participation,What It Is, How It Works”. Target, January-February. Pp. 19-26. Jackson, S. E., Schuler, R. S & Werner, S. 2011. Managing Human Resources. Cengage Learning. US. Jablin, F. M & Putnam, L. L. 2000. The New Handbook of Organizational Communication: Advances in Theory, Research, and Methods. Sage. US. Lumley, E. J., Coetzee, M., Tladinyane, R & Ferreira, N. 2011. ‘Exploring the job satisfaction and organisational commitment of employees in the information technology environment’. Southern African Business Review, 15 (1).pp. 100-118. Martin, M & Jackson, C. 2002. Personnel Practice 3/E. CIPD Publishing. London. NBER. (n. d.). Employee Participation Cuts Production Costs. [Online] Available at http://www.nber.org/digest/nov97/w6033.html Accessed 13 Nov 2012. O’Donnell, O & Boyle, R. 2008. Understanding and Managing Organisational Culture. Institute of Public Administration. Ireland. [Online] Available at http://www.cpmr.gov.ie/Documents/Understanding%20and%20Managing%20Organisational%20Culture.pdf Accessed 13 Nov 2012. Potocki, K. A & Brocato, R. C. 1995. A System of Management for Organizational Improvement. Johns Hopkins APL Technical Digest, 16 (4), pp. 402-412. Poustma, E. 2001. Recent trends in employee financial participation in the European Union. European Foundation for the Improvement of Living and Working Conditions. [Online] Available at http://www.eurofound.europa.eu/pubdocs/2001/12/en/1/ef0112en.pdf Accessed 13 Nov 2012. Rizwan, M., Khan, D. J & Saboor, F. 2011. ‘Relationship of Job involvement with Employee Performance: Moderating role of Attitude’. European Journal of Business and Management, 3 (8), pp. 77-85. Summers, J & Hyman, J. 2005. Employee participation and company performance: A review of the literature. Joseph Rowntree Foundation. The Homestead. Sarkar, S. (n. d.). Individualism-collectivism as predictors of employee attitudes towards union membership. Department of Personnel Management and Industrial Relations. [Online] Available at http://www.baf.cuhk.edu.hk/asia-aom/05_paper/14_sarkar.pdf Accessed 13 Nov 2012. Read More