High Involvement Work Practices Management Essay

High Involvement Work Practices:

With the increasing acknowledgement of employees being as an organisation’s asset there is a need to find ways to increase employee contribution to the organisation whilst better understanding how effective human resource systems operate. If an organisation can recruit and retain the right employees, develop them through training and skill acquisition, then this knowledge can be used as a competitive advantage to drive the organisation forward. Employee involvement tends to be largely focused on direct forms of involvement i.e. involving each employee, either individually or in groups, indirect communication between management and employees with our third party interventions (Jeff Hyman and Bob Masob)

In Human resource management literature the concept of best practices forms a critical theme. These practices are called as ‘high involvement practices’ and are referred as non – traditional HR practices that has become widespread in the companies (Ichiniowski et al., 1996). These practices are generally defined in 3 dimensions i.e. high relative skills requirements; jobs designed which provides opportunities to work in teams; and finally the incentive structure. (Appelbaum et al., 2000) The main assumption underlying over here is that management by designing high commitment work practices would enable employees to get involved and identify the goals required for them to perform.

High involvement work Practices (HIWP) allow for more input to the employees and organisations to optimise their inherent abilities more efficiently and effectively. Employee participation should be able to tell us how organisations should function and improve which can benefit the organisation and the staff. High Involvement is connected to the work place changes and is one of the constructive models for High performance work systems.

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According to the recent survey high involvement work practices develops optimistic beliefs and attitudes and these practices generates different kinds of discretionary behaviour that leads to enhanced performance. With all these choices developing a rational set of high involvement principles which are consistent to the organisation is a challenge for managers.

[Source: Alison, K. M. (2006). Engaging employees through high-involvement work practices, IVEY Business Journal, 6.]

But before that let us firstly understand the actual meaning of High Involvement, High Performance and High Commitment

High Performance: The general definition which is widely accepted is that they are set of complementary work practices that cover three broad categories: high involvement work practices; human resource practices and reward and commitment practices. These are also called as bundles of practices.

It involves development of number of interrelated process which together makes an impact on the performance in the organisation through its people. This is achieved by enhancing the skills and engaging the interest of employees. In other words they are simply the work practices that are used in order to improve the organisational performance. (Journal of Industrial Relations, 2002)

It is the combination of bundle work practices rather than individual work practices which shapes the pattern of interactions between managers and employees (Macduffie’s 1995: 200); (Human Resource Management Journal, Vol 19, 2009)

Some of the common Practices include:

Employee Involvement

Team based work

Training and Development

Employment security

Performance based bay

High Commitment: It is described as a form of management which is aimed at eliciting a commitment so that the behaviour is mainly synchronized rather than controlled by sanctions and pressures external to the individual, and relations within the organisation and are based on high levels of trust. Pfeffer. J (1998)

According to Walton (1985) high commitment can lead to low labour turnover, better product quality and employee flexibility. Most committed employees always associate themselves with the organization

Some of the Common Reward Practices are:

Performance pay

Profit sharing among employees

Job Rotation,

Flexibility in working hours

Family friendly policies

Share options to the staff members

High Involvement: Employee Involvement (EI) spans a variety of organizational procedures and practices which aim at creating a workforce that is committed to achieving the objectives of the organization. (“John Gennard and Graham Judge”) These practices encourage a greater level of trust and communication between employees and employers through involvement. This in turn is accompanied by empowerment, and the extent of discretion among the work force. (Journal of Industrial Relations, 2002)

Some of the common Involvement Practices are:

Information on Organisational Performance

Sophisticated selection techniques

Development of employee techniques

Job Security

Staff surveys

Quality circles/ Total quality Management

Staff Suggestion schemes

Self Managed teams

Literature Review: Since the early 1990’s there has been tremendous growth in labour management practices, which are categorised as ‘high involvement’ or ‘high commitment’ or ‘high performance approaches.

The recent literature has conceptualised such practices as forming coherent systems of mutually reinforcing HR Practices that works together to enhance organisational performance. (Barney 1995; Becker and Huselid 1998) Many articles, Publications refers to ‘high performance work systems’ (Berg 1999; Appelbaum et al, 2000), ‘high commitment’ HRM (Walton, 1985; Guest 2001a) or ‘high involvement’ HRM (Wood 1999a). There has been a difference between different scholars as to how best to characterise these practices and use them for discussion.

The term high involvement is used to highlight the importance enhanced opportunities for the employees to make decisions (Lawler 1986); others use the term ‘high commitment’ to understand the role of effective management in enhancing employee commitment and thereby reducing the need for monitoring and control (Wood & de Menezes 1998).

Other Authors describe employee involvement and empowerment within the organisation is similar to high involvement or high performance organisations. (Addison, 2005; Hardy & Leiba -O’Sullivan, 1998; Klien, 1984, Riordan, Vandenberg, and Richardson, 2005)

Although there are studies on involvement practices, they vary greatly in name high involvement practices, high performance systems, employee involvement. (Buchanan, 1982; Huselid, 1995; Pil & MacDuffie, 1996)

From the above literature review we come to a conclusion that there is no difference between high involvement, high performance and high commitment work practises.

Components of High Involvement Work Practices:

According to (Whitfield, 2000) there are 3 main important components that comprises of. Firstly employees should possess high level of skills and are assessed through training; secondly the work itself is designed in such a way that the employees have an opportunity to use their skills. This is done through the environment that the organisation plays in and also depending on the team structure, and then through job enrichment and job rotation; thirdly the pay structure which motivates and brings the commitment of employees to the organisation.

Other important components that constitute high involvement work practices:

Team working: Teams are important part of high involvement work practices. This can be achieved only when there is quality of work and flexibility in work.

Employee Empowerment: This is possible when the information is shared about organisation performance, providing rewards, and finally giving employees to make their decisions

Information Sharing

Rewards

Knowledge, Training and decision making

How effective are High Involvement Work Practices at Organisations

There has been lot of evidences shown and has been documented in the research studies on the effectiveness of high involvement work practices. Some of the organisation evidences that are shown below:

Saturn Corporation has incorporated the use of involvement and has organised into teams, work rules have been simplified and the Unions would be involved in making decisions. The communication would flow from bottom to the top of the organisation.

Chrysler Corporation has redesigned job classifications, established joint consultation committees and recognised work into teams.

In Another study conducted by (Eileeen Appelbaum and her colleagues (2000) studied 15 mills, 17 manufacturing industry and 10 electronic industry and has found that involvement showed better-quality performance, affirmative attitude, trust, commitment.

In the manufacturing sector study conducted by Jeffery Arthur 1994, has found that there has been significant improvement in training, more participation, higher productivity, and low turnover.

Research was also conducted in automobile and the call centre industry which has proved that there is increase in the job satisfaction, high commitment with the help of high involvement practices.

In crux these bundle work practices has positive effect that is beneficial to workers and organisations. Some of the positive factors are high morale, greater adaptability, increased trust, better job satisfaction and sense of commitment.

Case Study: 1

Name of the company: The Royal Automobile Association

Industry: Call Centre

About the Company: Royal Automobile Association employs around 4,000 employees and is the second largest motoring organization in UK.

Has got main customer service centre which employs around 200 permanent staff and employs fluctuating temporary staff during summer . It is a unionised organisation, but less number of staff from the call centre participates in unions.

Nature of Work: Most of the staff are customer service advisors and operates mainly on sales and service.

Performance Measures and Bonus Payment: Performance is measured as against the number of calls taken per hour, customer satisfaction index and the quality standards maintained by the staff. Bonus is paid to the staff once the above mentioned criterion is met.

Problems faced in the organisation:

Organisation is facing a cut throat competition from the competitors due to which its market share is under pressure.

Company wanted their staff to understand the reward systems in place and perpetrate themselves in rendering quality service to the customers.

In this scenario where a best fit and a bundle strategy has to be adopted in the same organisation the policy or emphasis approach can only be seen as an extension to the already available organisational policy. The best fit approach flows down from the organisational policy and the bundling approach will emphasise on performance management.

From the organisational strategy it is seen that the organisational goal of the company is to continue as an industry leader, increasing its market share, and improving its profit margins. Company needs to find effective ways of tackling these issues in order to retain its competitive advantage in the market and to effectively utilise its skills in training the staff.

Possible Recommendations by applying high Involvement Work Practices:

Pay Increase / High Compensation: Company has to pay with that of current markets standards, and competitors. This can be done by using salary surveys, identifying the key indicators and the reasons as to why the employees are leaving to other organizations. Also we can get this information by scrutinizing the local advertisements in the news papers, Job boards etc. We need to adopt this strategy in order to retain the existing staff and also to attract new people from outside.

Career Progression: Sometimes employees leave the organizations because they are not happy with the job; especially call centre jobs are routine in nature. Keeping that in mind there has to be consistency in the Job Profile. Ensure that techniques like Job Rotation, Enrichment and enlargement are used. We need to listen to what the employees wants and help them to develop their careers. Introducing Personality development proramme i.e. PDP, which will help us to identify what the employees wants to progress in his or her career. Create a provision of job sharing or rather opportunities to apply for the next level through intranet where employees will have a chance to apply and think of their own progress in career. Often give them more tasks or rotate employees into different roles. This gives them a feeling of flexibility and can do any job with ease. Ongoing feedback and performance appraisal would be a strong motivation tool to let employees know as to how they are doing. This will let them develop and what areas they need to improve on.

Work Environment and Flexibility in Working, other friendly policies: Employees must not be pressured to work beyond their ability and also they should be provided with flexi -shift pattern which would be comfortable for them to work. Allowing employees to swap their shift with when it is required. Proper breaks intervals have to be decided between works. Work life balance is a key if we are going to be in a position to attract and retain different people and we need to give that flexibility and get adapted to the changing conditions. Employees should be able to choose their working hours and vary their working hours if their personal circumstances change according the situation. Some of the other friendly policies like Private medical cover, Holidays plans, Family leave and child care, Company car and allowance

Performance Management Measures: As said, the main purpose of performance management is to get better results and create a better understand between management and staff. This is only possible when both management and staff ask themselves what they need to be able to do bigger and better things. Therefore any performance management scheme that is adopted in the organization has to be flexible, and follow the cycle process which is Plan, Act, Monitor and review. Transparency plays an imperative role. Organizations should use the techniques of aligning the performance parameters with the overall vision and mission of the company that is been set. Employee Performance is always linked with specific target given as an individual or as a team, and so it has got a direct impact with that of pay, bonus and other incentives.

Managers should try and involve people while taking decision, setting up of targets. There has to be relatively relaxed approach towards targets. Employee involvement mechanisms such as team briefings, staff suggestion schemes should be involved where in communication would flow in both the directions. In other words it would be a two way process. This gives an employee chance to present them, share best practices in terms of productivity, improve working conditions etc. It is our responsibility to create a platform for them to develop in all aspects. The best way to assess employees is through performance appraisal. It should be made sure that the employees would be measured on few parameters and should made sure that every employee of the organization has clear understanding about these parameters and transparency should be maintain while accessing employees performance. Managers should assess and give feedback on regular basis. There should always be a room for continuous improvement. Feedback meetings with the employees, a formal review or a one to one session would enable employees to understand the actual crunch of the business, their progress and the area of development; all this is possible with the management support and their accessibility By doing this employees would know where they stand and they can learn from the mistakes they have made earlier. Let managers and employee’s follow the concept of expectancy theory of motivation where an Effort would lead to a performance and that performance would again lead to a reward, reward with that of recognition and self – satisfaction.

Efforts → Performance → Reward → Recognition and Self – Satisfaction

Make employees feel that the organization is there for them. Recognize the efforts of the employees. This can be in the form of reward. A reward need not be in the form of cash, it can be a gift voucher, a discount coupon, or can be in the form or prizes. Once this is done every individual would strive to achieve their targets keeping in view about the quality that they have to deliver and company’s vision. All this is possible when there is cordial and mutual understanding.

Evidence: Timpson in Retail services has used extensive use of performance measures, recognised the efforts paid in by the staff members, created a sense of competition among team members at the same time focusing in rendering good quality customer service, giving timely feedback on the weekly basis

British Telecommunications, Rose and Wright, have been following this approach and have indicated positive results with greater job satisfaction and willingness to get more involved

[Source 1: IDS 2001, IRS 2004/ http://www.cwu.org/uploads/documents/callcentresbest.doc

Source 2: Johnny, S., & David, A. (2005). High Performance work Practices: Linking strategy and skills to Performance Outcomes. CIPD]

Reward System: Most of the companies link their bonus with that of individual performance and is paid on the annual basis. With the combination strategy we need to link with that of individual and team performance. As individual performance is concerned we need to pre define the factors that are considered for measurement in the appraisal process. Factors such as meeting customer needs, Initiative taken, Teamwork, Motivation and flexibility and as a team performance depends on the target that has been set and the efforts put in as a team. All members in the team should be given the same target because it would be easy for us to access and measure at the same time and overcome the difficulties if any.

In addition to this short term incentives scheme can be given on the monthly basis. In order to ensure that the incentives are worthwhile minimum required standards are met and more over the incentives should always be self liquidating apart from the profits that is been earned by the organization. Create opportunities where both individual and team can win. Ensure that the incentive scheme should be motivational by highlighting his performance on the notice boards, putting up pictures of those who are selected as winners, or through an e-mail congratulating the person or for the entire team in order to whip up the interest and enthusiasm levels

Evidence: Armstrong world industries, has used formal and informal day to day methods of recognising employees, and their efforts in the form of rewards. This shows that employee’s contributions are valued. It has created a win- win feeling to reinforce the behaviour and communicate to the employees about the importance of work.

Semler’s a Brazilian manufacturing firm has decided to give 23% of profit to the employees in the form of reward every financial year. This has made them to improve their performance and had made significant improvement in the business and reached all the targets set.

[Source1: Janet, E. (2009). Bonus and Cash Incentives, CIPD.]

Source 2: IRS Employment Trends/ Issue: 618/ Date: 15/10/1996/ Publisher IRS]

Case study: 2

Name of the Company: Mental Health Hospital

Industry: Hospitality

About the company: Mental Health is a trust which has a hospital serving inpatients and outpatients.

Nature of Work: Provides mental health care for children, adults and the elderly, helping with disabilities and undertaking specialist work. Operates on shift based system and is open 24 hours a day.

Work Force: Consists of qualified nurses, agency nurses trainees and clinical support workers.

Problems Identified: Reduced Job Satisfaction

Increased Work Load

Increase in absence levels

Turnover rates are high.

Company wants the HR department to develop a strategy to solve the problems and that creates culture of excellence.

Possible Recommendations by using High Involvement Work Practices:

According to the literature it suggests that health care organisations should develop strong retention culture and adopt high involvement work practices like employee participation and empowerment.

Researchers have confirmed that Financial Rewards in the form of gain sharing schemes i.e. profit sharing and share ownership had significantly reduced absenteeism to the greater extent. These schemes would give a long term commitment and would create a sense of harmony and satisfaction within the organisation which will result in greater organisational efficiency. (British Journal of Industrial Relations 1998)

Payment by results which can be in the form of individual or team, cash bonus, profit pay using these contingent rewards would solve the problem to the greater extent rather than using performance related pay (Brown 1992)

Employment Security: By providing employment security it helps us in building trust and harmonious relationship. It would be unrealistic to ask employees to put in their efforts and commitment without employment security and their future careers. With the help of psychological contract would create sense of mutuality. Employees should be treated as critical asset and success of the organisation. (Pfeffer 1998)

Selective Recruitment: Recruiting and retaining people would be an effective way to achieve sustained competitive advantage. Hiring process should be taken care of by using sophisticated selection techniques. Especially in the hospitality sector we need to look for team working skills, employee’s commitment. The use of psychometric tests, structured interviews is like to increase the validity.

Conclusion

A good high involvement work practices are one that involves and engages employees in such a way that firm’s productivity level is reached. Open communication and fair remuneration should be felt and valued in the organisation.

It is very important that the high involvement work practices should be implemented right from the beginning which helps in creating a sociological climate. This leads to change in the attitude and more involvement would be there from the individual’s point of view. The components of high involvement would allow the organisation to be the part of integral system which helps in overall functioning. The number of variables used in each area would allow the organisation to vary the degree of involvement from low to high.

High involvement work practices would function properly only when the organisation follows the comprehensive recruitment and selection procedure and more likely should develop sense of trust among employees. Training plays a vital role in alleviating the managers to train their employees in basic regulations which would enable them to make decisions.

Managers should understand how to implement high involvement work practices which has long term benefits that focuses on organisational change. It is the investment in human capital in the short-term that will lead to much greater results for the organisation in the future. Feedback and the information given to the employees appear to improve the overall productivity of an organisation. Employees should feel that they are secured and it is the culture of the organisation that gives freedom to the employees to voice out their opinions and put forward their suggestions in order to improve work process.