SOLUTION: High-performance working (HPW) | My Assignment Tutor

1Session 5: High-performance working (HPW)LO3Developing Individuals, Teams andOrganisations2Objectives of the SessionBy the end of the session, students should be able to understand:• What HPW is• How HPW develops and supports strategy development,competitive advantage and improve employee relations• Characteristics of a HPW organization (HPWO)• Benefits of HPW to employees and employers• Barriers of HPW• HPW and HRM related• The role of stakeholders in a HPWO2High-performance working (HPW)What is HPW?• Defining HPW is problematic since ‘there is no clear definitionor model and there remains a fundamental lack of agreementabout what specific practices might be incorporated in such adefinition’• General agreement is that HPW encompasses terms such as“high commitment’ and ‘high involvement’ and ‘bundles’ oforganisational practices which might leverage work activitiestowards intended business outcomes• HPW management practices have included, according toJones and Wright (1992): ‘comprehensive and performancemanagement systems, and extensive employee involvementand training, that can improve the knowledge, skills andabilities of a firm’s current and potential employees, increasetheir motivation, reduce shrinkage, and enhance retention ofquality employees’.High-performance working (HPW)What is HPW?HPW can be seen as the successor or an extension of the TotalQuality Management (TQM) movement• HPW focuses upon high performance practices and peoplecentred work systems• A specific combination of HR practices, work structures, andprocesses that maximizes employee knowledge, skill,commitment, and flexibility.• Systems composed of many interrelated parts thatcomplement one another to reach the goals of an organization,large or small• Examples of HPW organisations Google, Toyota, Apple,Netflix, Google, Dell, Autoglass3HR AlignmentPlanning andJob DesignCompensationEmployeeRelationsRecruiting andSelectionTraining andDevelopmentPerformanceManagementINTERNALFITHR AlignmentPlanning andJob DesignCompensationEmployeeRelationsRecruiting andSelectionTraining andDevelopmentPerformanceManagementINTERNALFIT4Developing High-Performance Work SystemsUnderlyingPrinciplesEgalitarianism“Decision Power” SharedInformation “Information”Performance-Reward Linkage“Rewards” KnowledgeDevelopment“Knowledge”5Principles of HPWS• Egalitarianism and Engagement– Egalitarian work environments eliminate status and powerdifferences and, in the process, increase collaboration andteamwork– When this happens, productivity can improve if people who onceworked in isolation from (or opposition to) one another begin towork together• Shared Information– A shift away from the mentality of command and control towardone more focused on employee commitment– Creating a culture of information sharing where employees aremore willing (and able) to work toward the goals for theorganisationPrinciples of HPWS (cont’d)• Knowledge Development– Employees in high-performance work systems need to learn in“real time,” on the job, using innovative new approaches to solvenovel problems– The number of jobs requiring little knowledge and skill isdeclining while the number of jobs requiring greater knowledgeand skill is growing rapidly• Performance-Reward Linkage– It is important to align employee and organisational goals– When rewards are connected to performance, employees willnaturally pursue outcomes that are mutually beneficial tothemselves and the organisation6Anatomy of High-Performance Work SystemsComplementary PracticesStaffingTraining andDevelopmentCompensation7Ensuring Fit• Internal fit– The situation in which all the internal elements of thework system complement and reinforce one another• External fit– The situation in which the work system supports theorganisation’s goals and strategiesAssessing Strategic Alignment:Fitting It All Together• The HR Scorecard– Assessing Internal fit• Do all internal elements of the HR systemcomplement and reinforce one another?– Assessing HR Practices• Do HR practices significantly enable keyworkforce deliverables such as employmentstability and teamwork?– Assessing External Fit• Are workforce deliverables connected with keystrategic performance drivers?8Implementing the System• Necessary Actions for a Successful HPWS:– Ensure that change is owned by senior and linemanagers– Allocate sufficient resources and support for thechange effort– Ensure early and broad communication– Ensure that teams are implemented in a systemiccontext– Establish methods for measuring the results ofchange– Ensure continuity of leadership and champions of theinitiativeImplementing High-Performance Work Systems9Benefits of HPWS• Employee Benefits– Have more involvement in the organization.– Experience growth and satisfaction, and becomemore valuable as contributors.High-performance working (HPW)Benefits of HPW to organisationA better employee attitude• Employees feel and take more responsibility for improving theorganisation’s products, services and processes• Employees take more initiative and the degree of innovationincreases• More new products and services are brought to the market place, inshorter time spans• More positive mentality and higher engagementBetter cooperation inside and outside the organisation• Employees cooperate more and better, both internally withcolleagues of other departments as externally with suppliers andcustomers• Employees are more open to ideas from other people and they seethemselves as part of an organisational value chain which has tofunction effectively along all its links• Employees are better and more frequent dialogues betweenmanagers and employees, and between organisational units10High-performance working (HPW)Benefits of HPW to employersA better organisation• Organisation has a more unique strategy compared to its peer group• Organisation becomes attractiveness to new customers andpotential employees• There is more focus and discipline• Employees also feel a strong corporate social responsibility – leadsto a better reputation both in the business community and in societyin generalBetter financial results• Productivity increases as the same people do more, with moresuccess• Profitability also increases as costs are lower and turnover is higher• Market share keeps on growing• As costs and budgets are better under control, the financial situationof the organisation improves and stabilisesHigh-performance working (HPW)Benefits of HPW to employersCompetitive advantage• Achieving higher high-performance organisation (HPO) scoresmeans better financial results• Organisation achieves the best financial results in comparison withits competitors• When organisational units are compared to each other: the unitswith the highest average HPO scores also have the best financialperformance of all the units, and vice versa11Build a TransitionStructureImplementHigh-performance WorkIncorporate the HR Functionas a Valuable PartnerNavigating the Transition toHigh-Performance Work SystemsHigh-performance working (HPW)Disadvantages of HPW• An expensive process and takes a lot of energy from the HRMdepartment to handle all the potential candidates• Time-consuming as the organisation works through so manyprocesses that go before selection• Nonparticipating leadership – Team members fail to use ademocratic leadership style that involves and engages teammembers• Poor decision-making – Team members make decisions too quicklywithout a blend of rational and intuitive decision-making methods.• Infrequent communication – Lines of communication are closed andinfrequent.• Diversity not valued – Team members do not value the diversity ofexperience and backgrounds of their fellow team members, resultingin a lack of diverse viewpoints and less successful decision-makingand solutions12High-performance working (HPW)Disadvantages of HPW• Lack of mutual trust – Team members do not fully trust each other orthe team as an entity• Inability to manage conflict – Not dealing with conflict openly andtransparently and allowing grudges to build up can destroy teammorale• Lack of goal clarity – Team members are unsure about their rolesand the ultimate team goals, resulting in a lack of commitment andengagement• Poorly defined roles and responsibilities – Team members are notclear about what they must do (and what they must not do) todemonstrate their commitment to the team and to support teamsuccess• Relationship issues – The bonds between the team members areweak, which affects their efficiency and effectiveness• Negative atmosphere – An overall team culture that is not open,transparent, positive and future-focused results in a failure toperform at high levelsEvaluating the Success of the SystemProcess audit– Determining whether a high-performance work system has beenimplemented as designed:• Are employees actually working together, or is the term“team” just a label?• Are employees getting the information they need to makeempowered decisions?• Are training programs developing the knowledge and skillsemployees need?• Are employees being rewarded for good performance anduseful suggestions?• Are employees treated fairly so that power differences areminimal?13Evaluating the Success of the System• To determine if a HPWS programme is reaching itsgoals:– Are desired behaviors being exhibited on the job?– Are quality, productivity, flexibility, and customerservice objectives being met?– Are quality-of-life goals being achieved foremployees?– Is the organisation more competitive than in the past?Outcomes of HPWS• Employee Outcomes and Quality of Work Life– More involved in work– More satisfied and find that needs for growth are more fully met– More informed and empowered, feel that they have a fuller roleto play in the organisation and that their opinions and expertiseare valued more– Have a greater commitment that comes from higher skills andgreater potential for contribution• Organisational Outcomes and Competitive Advantages– Higher productivity– Lower costs– Better responsiveness to customers– Greater flexibility– Higher profitability14Achieving Sustainable CompetitiveAdvantage through EmployeesCharacteristicsof Employees’CompetenciesValuable RareOrganized Difficult to Imitate28Employee Involvement• Employee Involvement – any activity by whichemployees participate in work-related decisions andimprovement activities, with the objectives of tapping thecreative energies of all employees and improving theirmotivation1529Advantages of Employee Involvement• Replaces adversarialmentality with trust andcooperation• Develops skills andleadership abilities• Increases morale andcommitment• Fosters creativity andinnovation• Helps peopleunderstand qualityprinciples and instillingthem into theorganisation’s culture• Allows employees tosolve problems at thesource• Improves quality andproductivity30Levels of Employee Involvement1. Information sharing2. Dialogue3. Special problemsolving4. Intra-group problemsolving5. Inter-group problemsolving6. Focused problemsolving7. Limited self-direction8. Total self-direction16Employee Involvement• Power– Authority to change job processes?– Self-managed teams• Information– Is business information shared?– Does the job involve performance feedback?• Knowledge– Does the employee have proper training for the job?• Rewards– Are rewards contingent on individual performance?Employee Involvement• Locating work decisions atthe lowest level possible.–Power–Information–Rewards–Knowledge and skills• EI in the Fortune 1000–150 Companies–1999 Survey LowEIMed EIHigh EIROA9.39.711.2ROI14.215.717.1ROE23.420.726.6Market Return-.72.811.9Market/ Book.71.31.8 Lawler, Mohrman & Benson, 20001733Empowerment• Giving people authority to make decisions based onwhat they feel is right, to have control over their work,to take risks and learn from mistakes, and to promotechange.“A sincere belief and trust in people”High-performance working (HPW)Common Types of High-Performance Work TeamsWork teams• Work teams are continuing units responsible for producing goods orproviding services• Their membership is typically stable, usually full time and welldefined• Work teams are found in manufacturing and service settings and aretraditionally directed by supervisors• Self-managing teams involving employees making decisions thatwere formerly made by supervisors are gaining favourParallel teams• Parallel teams pull together people from different work units or jobsto perform functions the organisation is not equipped to perform well• They exist in parallel with the formal organisational structure, havelimited authority and can only make recommendations• Parallel teams are used for problem-solving and improvementoriented activities (e.g., quality improvement teams, employeeinvolvement groups, quality circles or task forces)18High-performance working (HPW)Common Types of High-Performance Work TeamsProject teams• Project teams are typically time-limited and produce a one-timeoutput (e.g., a new product or service, information system or plant)• Membership is diverse, drawing from different disciplines andfunctional units, so specialized expertise can be applied to theprojectManagement teams• Management teams coordinate and provide direction to theirsubunits and are responsible for the overall performance of abusiness unit• Authority stems from the hierarchal rank of its members– At the top of the organisation, the executive management teamestablishes strategic direction and manages the company’sperformance by applying its collective expertise and sharingresponsibility for the overall successHigh-performance working (HPW)Common Types of High-Performance Work TeamsVirtual teams• A virtual team is a group of individuals who work together in pursuitof common goals across time, space and organisational boundaries• They are linked electronically by webs of communicationtechnology (e.g., the Internet, Skype, WebEx, internal networks)• Members coordinate their work predominantly with electronicinformation and communication technologies to accomplish specificorganisational tasks and may never meet face to face.• Virtual teams allow companies to obtain the best talent possible fora specific project without geographical restrictions• They are also generally viewed as more efficient in expenditures oftime and related travel costs1937Successful Empowerment• Provide education, resources, and encouragement• Remove restrictive policies/procedures• Foster an atmosphere of trust• Share information freely• Make work valuable• Train managers in “hands-off” leadership• Train employees in allowed latitude38Training and Education• Quality awareness• Leadership• Project management• Communications• Teamwork• Problem solving• Interpreting and usingdata• Meeting customerrequirements• Process analysis• Process simplification• Waste reduction• Cycle time reduction• Error proofing2039Compensation and Recognition• Compensation– Merit versus capability/performance basedplans– Gainsharing• Recognition– Monetary or non-monetary– Formal or informal– Individual or group40Barriers of HPO• Problem resolution –not able to quickly resolve business, team on team orindividual conflicts• Trust issues – where there is a lack of trust, team efficiency, quality issuesor innovation, apathy and conflict are not far away• Relationships issues – individual conflicts go unresolved, are known byeveryone and are a distraction to the team and business• Lack of role clarity – when two people occupy a common swim laneconflicts are going to occur• Lack of defined or enforced core values – how an individual conductshimself or herself is important to the long-term health of the team. Withoutsome standard of conduct usually defined by core values and enforcedthrough a 360-degree appraisal process, collaborative behaviour and teamcohesion quickly erode.• Poorly designed performance metrics and incentives – what getsincentivized gets done! When performance metrics are poorly designedthey typically set up internal competition and that competition leads to turfwars, low coordination, low collaboration, and conflicts between otherwisewell meaning people.2141Role of stakeholders in an HPWO• Owners – increase employee training• Managers (and top managers)– It influences as either originator or steward of the organisation’s missionand vision– It is responsibility for formulating a strategy that realises the mission andvision– It is responsible for strategy implementation– Employee empowerment through increased information flows and thedevolution of decision making– ongoing training– employees’ rewards and compensation– job satisfaction– organisational commitment– lower turnover– Ensure that work design allows employees to use a variety of skills– Ethical behaviour is encouraged– Create long-term customer loyalty42Role of stakeholders in an HPWO• Employees– Participate in selection– Participate in planning changes in equipment, layout, and workmethods.• Customers– Developing good relationships with the oragination• Environmental– Influence the organisation to environmental friendly– Expect a corporate social responsibility organisation– Expect an innovative organisation– Environmental turbulence influences the development of dynamiccapabilities• Social– Attitudes will influence an organisation the meet societal needs– Online social networks on leadership, influence the development ofparticipative and consultative leadership styles2243Role of stakeholders in an HPWO• Government– Provides a source of external expertise for businesses– Provides the legal framework for business operation, e.g., employmenttraining, remuneration, working conditions– Provide information and technical assistance to consortia of supplierfirms, their primary customers, and education providers• Suppliers– Supplies raw material on time and on a long-term basis– Build good relationships with the organisation– Establish partnerships with the organisation• Competitors– Forcing the organisation to increase its HPW practices– Challenge the basis of an organisation’s sustainable competitive advantage44ReferencesArmitage and Keeble-Allen (n.d). Leading from the front: The High PerformanceWorking (HPW) Inventoryhttps://www.ufhrd.co.uk/wordpress/wp-content/uploads/2009/07/3-24-refereedpaper.pdfHigh Performance Work Systems (HPWS) – UTAhttps://wweb.uta.edu/management/MichalskiJ/3320/spring2011/tthrm23hpws10.pptManaging Human Resources 15e. – Cengagewww.cengage.com/management/book_content/0324593317…/ppt/ch16.pptWhole file saved2010 South-Western, a part of Cengage LearningHuman Resource Practiceswww.eng.uwi.tt/depts/mech/pgrad/mech_manuf_indus/courses/…/Q6-06.ppt2345ReferencesBerber and Yaslioglu (2014). Managing High Performance Work Systems andOrganizational PerformanceManaging High Performance Work Systems and … – Springerhttps://www.springer.com/cda/content/document/cda…/9783319063751-c2.pdf?…High Performance Working: Case Studies Analytical Report EvidenceReport 21 May 2010https://www.researchonline.org.uk/sds/search/download.do%3Bjsessionid=D09F1B3FD669D5DA5725CE0309CCE4ED?ref=B16303