Perspectives on Industrial and Corporate Change - Case Study Example

Perspectives on Industrial and Corporate Change Organizations are groups of people working on towards a specific aim or target. While organizations that are based on mutual interest and affiliation of the people within the organization are easier to mobilize it is a more different case when we approach corporate organizations, which at the outset has its own personal aim, usually to increase worker efficiency and increase productivity. The problem lies under the fact that corporate organizations’ aims lie on the interests of the corporate leaders and not the interests of the employees (Chytry et al. 1998 p.120) and because of this corporate leaders and employers need to find alternative means as to mobilize their workforce into correlating with the aims and tasks of the organization. There are several problems that are faced by economic organizations as their actions are crucial points that affect social, political, environmental and economical spheres. In this paper we will examine psychological knowledge that can be applied within a corporation based organization, this aspect usually touches the social and political aspects of humanity and how strategic human resource development not only benefits the organization as a whole but benefits the society in question as well as the people who work within the organization are a social system that interacts with one another. An example of a corporate organization that has benefited from using strategic human resource development is from a case study recorded in Work Design for the Competent Organization (Frei et al. 1993, pp.207-224) concerning the company Tetra Pak. Tetra Pak is a family owned business that provides packaging equipment for juices and milk resulting in a conservation technology called UHT (Ultra High Temperature). The company leases the equipment for the UHT technology while the packaging cardboard must be bought from Tetra Pak itself. This case study deals with their German subsidiary that produces the packaging and product labeling. The organizational hierarchy of the German subsidiary is in five levels with the highest being the chief executive officer then the corporate area managers, department managers, supervisors and then the employees. The company in question tried a method to change the organizational structure and the leadership style as they realized that to improve the quality of work they needed to improve the quality of work life of the employees as well. To achieve this they began using a five phase diagnostic model with two aims in mind. The first aim was whether this model of strategic human resource development could still be in use in five years and the second aim was to see what the changes were to achieve this goal. The diagnostic model of assessment required to see the strengths and weaknesses of the organization in question as well as every aspect within the organization itself (including employment, finances and leadership style and atmosphere). The model of SHRD (Strategic Human Relations Development) since it was delegated into phases took several years to be implemented. One of the most important benefits gained for the Tetra Pak project1 was the implementation of better communication systems in every area (especially that of employer-employee relationship) and as a result of this several employees who has never been able to communicate effectively began to see this as an opportunity to voice out their opinions. The betterment of communication within the organization is very important because effective communication allows for a better work environment and dissipates any resistance or discontent among the workforce. Proper understanding leads to a better quality of work as the supervisors and management are able to convey what they want to the workforce and the workforce has the ability ask what is required and needed and whether they will be able to do the task at hand. The details of communication and their benefits can be seen even further, in one example one of the area managers was criticized over an authoritarian leadership style and he was able to improve his leadership style by following one of the self-improvement seminars under the SHRD system. There are several motivating factors that pushes the need for HRD systems, in an article written by Torraco and Swanson (1995), they both examined the implications of a fast growing technology which induces continuous change in the way we build and systemize organizations. HRD systems provide an effective organization in the long run and with quickly changing values of the technology based world it provides employees within an organizational system the benefit of psychological and social well being. Not only that, the successful business ‘hinges’ on the successful organization. The next case study focuses on one of the leading technological producers in the world, Motorola and how they employ strategic human resource development within their corporation and how they deal with the even faster pace change of technology to suit with the needs of their social systems. Motorola, is one of the more important technology producing companies in the world, it needed employees with diverse skills and more importantly, a flexible and malleable workforce that could change with the demands of production and be equipped with the latest skills and expertise. Since such skills would require the changing of workers according to skill and expertise, Motorola instead developed a training system to better equip their workforce and give them the opportunity for better pay. The training initiative implies an investment towards its workforce as well as providing reasons for the employees to be loyal to the company. The training provided permeated every level of the hierarchy to creating a business well-equipped to face newer challenges. The authors argue that HRD systems sharpen and shape an organization to effectively achieve aims and objectives. The model provided by Motorola and their successful approach in business reflects this even to this day. However, in a more recent study concerning Motorola’s approach with HRD is written by DiGiovanni (2003). This next case study is about the already implemented training courses conducted by Motorola for their workforce in Motorola University. Recent business and political trends have resulted in a more tougher economic situation, because of this Motorola has initiated downsizing programs and are facing cuts to provide employee training. With this in mind most HRD models only suit organizations with a stable cash flow the downsizing cuts made by Motorola University made sure that the cuts did not affect their most potential and profitable courses. Motorola University decided to take a major step in decentralization and implementing individual decision making on the organizational system as a whole. Therefore, MU (Motorola University) had to take initiative steps in using alternative means of training for their employees2. This proved effective for employees as the costs for funding were lower than real courses. It seems that the benefits of SHRD are timeless and there are alternative ways to cut costs when employing SHRD. The values of SHRD are endless as they provide employee and employer satisfaction as well as needing the needs and demands of the customer. Since Motorola is a communications based company the added effect of improving communications systems within the organizations itself was imperative in keeping in tune with customers demands. This makes employing SHRD invaluable for the organizational system itself, there needs to be what is called ‘flexible learning’ (Garrick and Jakupec 2000, pp.1-3) because there is often a fast paced change that previous knowledge becomes obsolete quickly. People needed a lifelong learning process compared to traditional learning methods when what is taught stays for life SHRD addresses this problem through training programs and models of change. There are several models of change employed in strategic human development resources (SHRD). In particular on learning and development that supports change within an organization. There are different courses throughout behaviour and its interaction with the environment. The problem with organizational psychology is the fact that organizations move and change according to the demands and needs of the time, t is not a static process in which a certain model can be implemented for a longer time (Huffington et al. 1997, p.12). Therefore several of the theories here may be relevant at some context but models of change could be irrelevant and even unsuited for other situations. More importantly, organizational behaviour is linked with too much theory and a lack of practice, furthermore, theories of models of change are often criticized for being usually vague (Miner 2002, pp6-8). There are two distinct forms of human resource management (HRM), the soft approach or the hard approach (Gratton et al. 1999, p.40) and they exist in either normative or prescriptive models of HRM. Soft HRM focuses on a people oriented model of change, it tries to utilize what people’s talents are and harness them to reach the goal or aim of the organization. Its concept hinges on a work system that expects the employees to be satisfied with their work and wishes for the employers to reach their goal or aim. It is believed that when employees do not feel the fullest satisfaction and that a job is ‘just’ a job they are unable to achieve the extra mile for their company. The hard model or approach to human resources depend on a more utilitarian approach that is very rational and well-thought, it completely ignores the basic emotions attached to the workplace by the people and the social system. Although, both of models of change are not employed fully within an organization and at some point or another organizations lie in between these two extremes, it is hard not to ignore that both of these systems can be integrated to support change within an organization. The hard model is very quantitative in terms of profit for the business. One of the other most important models of change theory that supports development within an organization was a work done by Kurt Lewins (1945) where he defined systems of change in several phases. The earlier phase is the ‘unfreeze’ phase or the ‘open’ phase where there is dissatisfaction occurring within the organization by some event or stimulus. People will begin to question the relevance of certain functions and the normative (Frei et al. 1993, p.31). This is a very difficult stage as there are different interpretations as to how people think and there are different ways in which a certain idea might be more appealing than others, whatever the case this is a very important stage as it pushes people to ‘move’ and begin changing certain aspects within their organization. The second phase or stage is the ‘move’ stage, this aspect of the stage will begin questioning other methods that will become relevant to the system of the organization, several theories will be tested as to whether the answers that have been brought up are relevant to the organizational system as a whole and whether it will be beneficial to the business at hand. This part of the phase or stage is to induce change within the people who have become dissatisfied with the way the organization is running. The next phase is the ‘freeze’ or ‘consolidation’ phase whereby those who were previously dissatisfied with their situation has been ‘moved’ and is now entering a new state. When they begin to enter this new state they will feel at lost at first and are unsure but as time goes by they will begin to feel that this is the ‘normative’ and their motives at the moment is ‘freezed’. There are models of change within an organizational structure as explained by Randall (2004). One of the simplest models of change is the ‘incremental’ model of change. This type of change model processes the change before it is implemented, it usually embodies a type of change including the transition of phasing out the previous change and to put it in Lewins’ words the ‘consolidation’ of a change. This type of change is scheme-based and it conceals any problems along the way that proceeds during the changing transition. The second type of change within an organization is referred to as the ‘punctuated equilibrium’ model, this type of change probably occurs when there is a ‘need’ for change or even when a whole process is already implemented the change will occur after3. When models of change are implemented problems occur as the people who have developed a ‘norm’ to the previous system will feel ‘lost’ or affected, this is referred to as a cognitive dissonance in the part of the workforce or employee/individual4, they might perceive the change as negative and each individual within the organization will have a different presumption of what the outcome would be out of the made changes. However, change is a process that could be ‘internalized’. When change occurs a period of transition should be allowed in time before people will learn to accept the change. When change intervention occurs and when we apply Kurt Lewins’ theories of change we are able to separate the ideas that cause this dissonance within the organization. Several concepts that can be based to avoid resistance is by providing individual based counseling, seminars, initiatives for workers and the most popular, training. However, it must be kept in mind that there isn’t one solution to every organizations needs, different organizations have different needs according to their social, cultural even religious needs to be met. What is imperative is to construct a plan as to how the organization can go from State A (the existing situation) to State B (the planned situation)5. It is thought that proper management can overcome such resistance towards change and it could be using either the implementation of the soft approach or hard approach as described above. What is important is to dissipate tension strands between the employer and employee, however, it has been stated that when a dynamic role between the management and employee could be seen as a power dichotomy, several stances need to be introduced to reduce this tension between the employer and the employed. Strategic human resource development in summation usually focuses on implementing vehicles of change. The main aim of most organizations to build an effective organization that also affects the organizational system and the social system as a whole. It is necessary to employ such strategies to avoid tension within an organization especially as mentioned above when change is implemented. Tension exists everywhere within society however behaviour attitudes or attitudes towards clients and subordinates can be met when there is always open communication. The essence of most of the theories above is effective and open communication at every level, when this is achieved a flow can be created whereby creating a stable and happy work environment. The social system within an organization needs to realize that they are social beings and if we properly account Maslow’s hierarchy of needs we can understand that if the most basic needs are not being met it is difficult to expect the people within the organization itself to actually give out a good level of expectancy and quality. We also need to keep in mind that theories don’t necessarily ‘pan out’ when put into practice and we can actually separate several components of the theory and allocate them specifically when we put them into practice. Notes 1) The Tetra project is called the Z-89 project. The ‘Z’ was not specified as it could be whatever the personnel could imagine it to be. For eg. ‘Z’ could stand for ‘Zukunft’ (future), ‘Zufriedenheit’ (satisfaction), etc. From this it could be seen that the aim of the project was to meet individual needs within the organization. 2) MU used a simulated training system, using this method they were able to cut costs and maintain quality 3) Randall, J. (2004), Managing Change, Changing Managers, NY, Routledge pp.30-32 4) Ibid 19 5) Ibid 60-64 It could be seen that the resistance to change comes about from the employee’s feeling of insecurity especially if the prospective could include downsizing. However, it could also be the feeling of incompetence for doing the work that comes about with the change. Reference: Digiovanni, M. (2003, November). A Vendor-Provided Case Study: Motorola University Uses Celemi Solutions to Impact Business Results in Tough Times. T&D, 57, 81+. Dosi, G., Teece, D. J., & Chytry, J. (Eds.). (1998). Technology, Organization, and Competitiveness: Perspectives on Industrial and Corporate Change. Oxford: Oxford University Press. Retrieved May 5, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=28060303 Frei, F., Hugentobler, M., Schurman, S., Duell, W., & Alioth, A. (1993). Work Design for the Competent Organization. Westport, CT: Quorum Books. Retrieved May 5, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=27603163 Gratton, L., Hailey, V. H., Stiles, P., & Truss, C. (1999). Strategic Human Resource Management Corporate Rhetoric and Human Reality. Oxford: Oxford University Press. Retrieved May 5, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=37428579 Huffington, C., Cole, C., & Brunning, H. (1997). A Manual of Organizational Development: The Psychology of Change. London: Karnac Books. Retrieved May 5, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=55270794 Jakupec, V. & Garrick, J. (Eds.). (2000). Flexible Learning, Human Resource, and Organisational Development: Putting Theory to Work. London: Routledge. Miner, J. B. (2002). Organizational Behavior: Foundations, Theories, and Analyses. New York: Oxford University Press. Randall, J.(2002), Managing Change, Changing Managers New York: Routledge Torraco, R. J., & Swanson, R. A. (1995). The Strategic Roles of Human Resource Development. Human Resource Planning, 18(4), 10+. Read More