High Commitment Work Practices - Essay Example

HIGH COMMITMENT WORK PRACTICES AND ORGANISATIONAL PERFORMANCE-AN ANALYSIS High Commitment Work Practices and Organisational Performance-An Analysis Introduction According to Bridges and Wesley (1994, p 1), “jobs are artificial units imposed on work”. Based on the traditional rules of job, there will be rigid and fixed hours of scheduled work and in return to that the workers get fixed salaries .This is without considering the amount of work produced by the worker (Doodley and Prause, 2004). According to the new rules of jobs, these trends are changing .With a participatory focus to jobs, recent phenomena includes work arrangements that are more flexible to get the jobs done at less cost called high commitment work practices. These practices include “practices that enhance communication across organizational levels, invest in employees, facilitate long-term relationships, and pay for performance (Burton and Reilly, 2004, p5). These practices were mainly intended to improve the efficiency of the jobs based on the theories of the impact of employee participation in job satisfaction and job performance and the organizational performance. Many research studies show that though these types of arrangements seemed to be attractive for some workers, they have many social costs like uncertainty about job prospects and the risks of non-availability of jobs (Doodley and Prause, 1994).However, the debate remains unsettled. In this context, this essay analyzes the evidence linking highly motivated work practices and organizational performance. Based on the analysis, it explains the reasons for UK firms continuing to use a traditional management style coupled with job designs based in the principles of scientific management. 2. Theoretical Arguments Based on the traditional principles of scientific management, the main building blocks of organizations were considered as man and jobs linked together and supervised by a manager .Here, man was simply considered as an extension of machine (Davis, 1970). This school based on the top down approach to strategic management helped to distinguish between functions, skills, roles and management and evaluates its importance. This school focused on the jobs itself and did not give much attention to the role of workers (Asan and Soyer, 2009). This school helped to distinguish between functions, skills, roles and management and evaluates its importance. The main criticism against this approach is that it is appropriate only for stable environments and may not be suited for fast changing competitive environments (Asan and Soyer, 2009). This is because in fast changing environments some of the most successful strategies may emerge from the bottom level informally than from the top level. Human agency theory based on bottom up approach to strategic management has created an atmosphere of employee empowerment instead of the previous management style whose philosophy was simply deciding what needs to be done and ordering people what to do (Brown et al. 1994). This means managers sharing their power with employees by regularly asking their input and at the same time keeping a minimal rejection on their ideas. Thus, the importance of employee participation as a business strategy was first found to be important according to this school. Based on this theory, the job design in an organization needs to be in such a way that the participation of employees need to be ensured in decision making programs, selection and recruitment procedures ,establishment of policies and procedures and decision on perks etc. This in turn creates a need for urgency in employees and a motivation to them, which in turn will enhance their productivity and performance. In addition to these, the participative management is supposed to have decreased the employee turnover which in turn enhances the organizational performance (Cotton & Tuttle, 1986; Bluedorn, 1982; Koh and Goh ,1995 etc). According to O Neill(1999,p 1 ),the main features of old rules of employment include being able to locate the employee vertically in organizational hierarchy, being able to locate the employee horizontally in functional area ,job description and career path. Based on the new rules of employment, the focus of the work is performance rather than responsibilities. Here, there is no long-term employment and the workers will work in a team .The workers will do multiple jobs and share their responsibilities. The companies some time will counsel the workers regarding what needs to be done. There will be more flexibility of jobs here (Bridges and Wesley, 1994). Thus the main features of new rules of employment called highly committed work practices include the treatment of everyone is a contingent worker, need for workers to demonstrate their value to the organization in each successive work situation, need for worker to view themselves as vendors in business for themselves, companies building benefits into this assignment-oriented work rather than as add-ons, e.g. higher pay while working to make up for time out of work, workers take primary responsibility for career and life needs like professional development, health insurance and retirement, organization of work by project teams where the group, not the manager, is the responsible party, rapidly change among tasks, work on multiple projects, without clear job descriptions, frequently changing organizations, no long-term employment and companies will provide information, training, counselling during this transition(O Neill,1999,p1). Cotton (1993) and Blake and Mount (1981) compiled various forms of these practices as Quality Circles, Gain sharing, job redesign and employee ownership. 3. Empirical Evidence Locke, Schweiger and Latham (1986) asserted that the high commitment work practices based on participative management is appropriate only in certain situations. In elaborating this phenomenon, they indicated that in some cases, participative management could lead to lower employee satisfaction. Miller and Monge (1986) after reviewing some 106 articles and book chapters of laboratory and field studies, reported mixed results on the relationship between high commitment work practices and job satisfaction. They found a strong relationship between participation and job satisfaction, but a slight link between participation and productivity. Their inference stated that participation enhance productivity through intervening motivational process. That means, first participation fulfills employees’ needs, and the fulfillment of the needs leads to employee satisfaction. Subsequently, satisfaction strengthens employee motivation and the increased motivation leads improvement of worker productivity. Subsequently, satisfaction strengthens employee motivation and the increased motivation leads improvement of worker productivity. However, this inference remains to be proved. Similarly, Cotton (1993, 1996), and Daniels and Guppy (1994), Daniels and Bailey (1999) indicated that the relationship between employee participation and job satisfaction could be non-linear and contingent on individual and situational variables. In a study by Scott et al (2003) on the impact of employee, participation on job satisfaction in the US invested enterprises in China has shown that more involvement of employees in decision-making has a positive impact on job satisfaction. This effect is more dominant when there is a supportive work environment including supportive bosses and colleges and when there is a lively team environment to work. Bridges (1994) has shown that the high commitment work practices have led to an immediate loss of jobs and an immediate increase in employment of temporary professionals also. There are some human resource implications for these practices also. These include the need to hire people who perform well without a given set of fixed job descriptions. In this case, simply filling up a position is not the requirement .Instead of this, the HR issue is to recruit people who can identify what their jobs are and create the slots that fit them. This slot itself will be a variable rather than the fixed one based on traditional rules of employment (Bridges and Wesley,2000).There will be a flattening of the managerial layers (for example firms like AT&T, ABB and General Electric). Collins (2005) examining the impact of locational flexibility on individual and organizational performance based on the case study of Lloyd’d of London obtained tele workers 23 percent more productive than office workers. At the same time he obtained the costs involved in tele working like setup costs and recurring running costs cancelled the effects of increased productivity and hence tele working was in effect neutral. Nissar(2006) based on a linked data set of employers and employees, examined the incidence of flexible work practices and their impact in Britain. The main reasons obtained from this study for the organizations to implement flexible working practices are the concern to increase employee participation and the need for compliance with public regulations. The study obtained large and medium establishments offering workplace flexible practices in UK while small establishments not being able to offer them due to high costs of implementation. The study also obtained many sectoral differences in the reasons for adopting flexible work practices. However the study obtained only limited support for the argument those flexible working practices is a type of employee participation strategy through which employees can decide on their own working hours for improving organizational performance. A weak impact was obtained on job control by flexible working practices while negative impact was obtained on stress and job security. Kelliher and Anderson (2008) based on the case study of an organization in UK examined the impact of flexible work practices on the perceptions of job quality. The analysis was done based on semi structured interviews and a staff survey. The results obtained by thematic content analysis and categorization techniques showed the flexible work practices positively affecting the job quality perceptions but differential impacts on different dimensions of job quality perceptions. While the flexible work practices were obtained to affect the control, autonomy and job satisfaction positively the results showed negative impact on stress and opportunities for learning and advancement. Thus the sturdy showed positive impact of flexible work practices on some dimensions of job quality while at the same time had some costs in terms of generating stress and reducing the opportunities for learning and advancement. Humphreys et al (2010) examined the benefits and challenges of family friendly working arrangements in Ireland and the role of policymakers, employees and the trade unions in the process. Based on a systematic review of the existing documents and statistical evidence, it was obtained that flexible working practices can help in facilitating employee retention as well as increasing productivity and reducing efficiency costs. The study obtained that the flexible working practices from an employer perspective can help them to reconcile work and caring responsibilities. However, the study clearly pointed out that the benefits can be obtained only if the flexible working arrangements are implemented effectively. 4. Reasons for UK firms continuing to use a traditional management style coupled with job designs The above sections show that the high commitment work practices are supposed to increase organizational performance in terms of job satisfaction, job productivity, employee retention, customer satisfaction, job quality etc. The empirical evidence however shows mixed evidence in this regard. Moreover the review showed many costs of the work flexibility in terms of more stress generated and less opportunities for learning and advancement. Moreover the benefits of high commitment work practices can be obtained through effective implementation of them suiting both the needs of employer and the employee. There are many factors affecting the influence of high commitment work practices on organizational performance as shown by the above discussion. The example of Microsoft shows that highly committed work practices led to increased stress and frustration rather than organizational performance improvement. In Microsoft, at present nobody has fixed job and no fixed working hours. Instead, everybody works in a team and there will be 24 hours work. The workers are accountable to the project team rather than the managers. The main message of the company is the following “You are on your own. For good (sometimes) and ill (often), the workers of the future will constantly have to sell their skills, invent new relationships with employers who must, themselves, change and adapt constantly in order to survive in a ruthless global market”( Bridges and Wesley, 2000,p 3). However, the negative side of the story is that over the clockwork has resulted in the resignation of many people from the company also due to anger and frustration. On April 14 2008, the US based Delta and North West Airlines merged .This has resulted in the creation of the largest global airlines in terms of traffic and second largest global airlines in terms of revenue. However, it has resulted in huge job losses (ICMR, 2009). Due to the above reasons and based on the examples of many firms as shown above, many UK firms continue to use the traditional management techniques coupled with job designs based on the scientific principles of management. For example, the case study of Bacardi-Martini UK, one of the most famous and highly successful drink manufacturing companies in the world is still family run business. This company uses the traditional management techniques and at the same time coupled with job designs with a focus on people and based on the values productivity, accountability, creativity and teamwork. The company is still controlled by the family and at the same time considers the staff development seriously. The company has many schemes and plans for the staff welfare and thereby enhance job satisfaction. Moreover the staff are involved in the decision making process of the company .At the same time, the employer strictly monitors that the staff is contributing significantly to the success of the company. The job security of the employees is a priority in the company and thus the company uses traditional principles of management combined with job designs (Sparham and Sung, 2008). Another example is Pannone and Partners, which is one of the successful legal firms based in Manchester. In this firm, the work life balance culture helps to attract employees and in their retention. The staff involvement is done in the decision making process and at the same time, the company strictly monitors the performance of the staff to ensure their quality performance. The reports show the staff in the firm as highly committed and satisfied with high work-life balance (Sparham and Sung, 2008). In both of the above examples, the work-life balance is achieved through the highly committed work practices. The job designs and the traditional management techniques leads to better job satisfaction and job productivity and thereby improved organizational performance in both these cases. In both these cases, the hard work need not lead to stress and the highly committed practices together with the traditional techniques meets the needs of both employers and employees. 5. Conclusion In this essay the evidence linking highly committed work practices and organizational performance is examined. The discussion shows that though these practices are supposed to enhance performance through improved productivity, job satisfaction and increased employee retention, the evidence shows mixed results. The success of these practices depends on the effective implementation and strategy as shown by the examples of many firms. The ineffective usage of these practices leads to increased stress, frustration and increased job losses. Due to these reasons, many UK firms use traditional management techniques coupled with job designs based on the principles of scientific management. References Blake, R. R., & Mouton, J. S. (1981). “Productivity: The human side”. New York: AMACOM Bluedorn, A.C. (1982). “A unified model of turnover from organizations”. Human Relations, 35(2): 135-153. Bridges W and Wesley A (1994): “Job Shift: How to Prosper in a Workplace Without Jobs “, Massachusetts: MIT Press. 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