Tech No Structural Interventions

Organization Development: Techno-Structural Interventions

Prepared by the Master’s Students in Industrial-Organizational Psychology

Radford University Class of 2001

Edited by

Piper & Associates, Inc.

Organization Development: Techno-Structural Interventions Prepared by the Master’s Students in Industrial-Organizational Psychology Radford University Class of 2001 Organization development activities can be directed toward individuals, groups, divisions, or entire organizations. Regardless of whether the recipient of an intervention is a person or a multi-national corporation, the ultimate goal is the same: to improve the effectiveness of the organization. This document reviews selected techno-structural interventions – change programs focusing on the structure and/or technology of the organization. Each intervention’s purpose, cost, procedures, expected results, likely results as documented in the literature, and reports of industry use are provided, along with a list of relevant references. Most summaries provide the following information, though some will have more or less.

1. NAME OF INTERVENTION:

Most commonly used name, along with alternatives.

2. TARGET LEVEL(S) OF ANALYSIS:

Is it directed toward organization-wide, group/ unit/ department, or individual change?

3. PURPOSE OF THE INTERVENTION:

What is the primary goal of the intervention?

4. EFFECTIVENESS CRITERIA:

What are the most appropriate outcomes (behaviors, attitudes, knowledge, skills, performance measures) to assess?

5. EVIDENCE OF EFFECTIVENESS:

a.

What does the literature suggest regarding the likely outcomes of the intervention? Effect sizes are reported where available.

b.

What organizations, groups, individuals have used this intervention? Exemplary case studies are reported where available.

6. HOW/WHEN WILL OUTCOMES BE ASSESSED: 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS:

How has the intervention been evaluated? CEO, upper or lower management, new hires, blue collar, education level, etc., of typical participants are reported.

8. TIME-FRAME OF THE INTERVENTION ITSELF: How long does the intervention take? 9. TIME-FRAME OF ANTICIPATED CHANGE:

When should results be observed?

10. RESOURCES TO CONDUCT INTERVENTION:

Internal/external consultant(s), technology, space, physical environment, money, time, support staff, etc., necessary for implementation.

11. EXPERTISE OF CONSULTANTS:

Training or education or experience requirements to cconduct the intervention are provided.

12. DO PARTICIPANTS NEED TO PREPARE:

Are there pre-intervention instructions? Does the organization, group, or individual need to be involved in planning?

13. HOW IS THE INTERVENTION CONDUCTED:

A detailed description of the conduct of each intervention is provided.

14. RESISTANCE TO CHANGE:

Are participants likely to resist change? How can that be overcome?

15. MAINTAINING CHANGE:

What should be done to minimize the return to old habits?

16. FOLLOW-UP:

Is follow-up needed?

17. SPECIAL CONSIDERATIONS/CRITIQUE:

What else do we need to know?

18. REFERENCES:

Citations (particularly for Sections 5 (a & b), 13, and 14) are provided.

TABLE OF CONTENTS Intervention Name

Page

Total Quality Management ………………………………………………………. 5 Employee Empowerment Programs ……………………………………………… 15 Quality of Work Life Programs ………………………………………………….. 26 Implementing a Team-based (AWG, etc.) Organization ………………………… 34 ISO 9000 and Beyond ……………………………………………………………. 47 Process Reengineering …………………………………………………………… 54 Organization Restructuring (downsizing, rightsizing, mergers, acquisitions) …… 61

Total Quality Management (prepared by Julie Martin) 2. TARGET LEVEL OF ANALYSIS: TQM programs are directed at the entire organization including the suppliers and its customers. Although quality at the individual level is important, the successful TQM program calls for quality from every person, at every level of the organization, in every capacity within the organization. In short, TQM programs require a change in the organizational philosophy and culture. 3. PURPOSE OF THE INTERVENTION: The purpose of Total Quality Management is to increase customer satisfaction by improving the quality of the goods or services offered by the organization. This improvement is centered on the product or services, and the processes involved in making or delivering the product or service to the customer. Ultimately the goal of TQM is to make quality the way of doing things within the organization. 4. EFFECTIVENESS CRITERIA: In all Total Quality Management programs the ultimate effectiveness criterion is customer satisfaction. According to the research, to reach this ultimate goal of effectiveness requires that the organization measure several other criteria on a continual basis (Weaver, 1991; Hackman & Wageman, 1995; Dahlgaard, 1999; Clark, 2000). The appropriate criteria to measure depends on the type of organization, and whether they deliver a product or a service. In a production-based organization, the effectiveness criteria are divided into product measures and employee measures. The possible measures for the product include: increases in production, increases in sales, increases in market share, increases in stock prices, reductions in the product cycle time, reductions in the number of reworks, reductions in the inventories, and reductions in customer returns. The employee measures include: satisfaction with the company, commitment, performance, turnover, absenteeism, and grievance activity (Clark, 2000). In service organizations the measures of effectiveness may include reductions in customer complaints, increases in return customers, increase in customer referrals, higher customer volume, higher employee satisfaction and commitment. 5. EVIDENCE OF EFFECTIVENESS: Research into the effectiveness of TQM programs focuses mainly on the increase in market shares, and the increase in stock prices. Many organizations measure the success of their programs in the reduction in cycle time and product failures. The success of quality programs are most often related to percent increases in the market share, and overall capital of the organization. (Creech, 1994). Successful organizations like Harley-Davidson, Ford Motor Company, Johnson & Johnson, Motorola, Xerox, and others, tell of a long, arduous journey and complete re-organization of their companies from centralized, out-put focused, to de-centralized customer focused before they were capable of reaching their goals of Quality at all levels of the organizations.

6. HOW/WHEN WILL OUTCOMES BE ASSESSED: In order for TQM to be successful, outcomes should be measured frequently and on an ongoing basis throughout the entire organization (Cartin, 1993). The main idea behind this intervention is to increase and maintain customers through the ongoing improvement of the products or services offered by the organization. To follow this ideology requires that all phases of the manufacturing be monitored and evaluated on a continual basis. According to Cartin (1993), most TQM programs ultimately fail because management mistakenly assumes that the first successes are the end results of the program. When this happens, the organization cries victory, and the TQM program eventually fails in the absence of continual monitoring. Cartin argues that TQM is an ongoing intervention with no end, therefore assessment of outcomes must also be ongoing and continuous if the TQM program is going to succeed. 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: The participants involved in TQM programs are many and varied in their education and experience. According to Deming (1986) TQM involves the leaders, the employees, suppliers, and the customers of the organization. Once the organization has decided to implement the principles of TQM into the organization culture every person in the organization is affected. The key to participation within the organization is a willingness to embrace quality and as noted by Creech (1994), a willingness to live quality. Key to successful TQM programs, is the attitude of upper management. It is through upper management that the ideas of total quality take root and grow within the organization. Without the total commitment of upper management TQM programs lack the role models central to changing the employees. 8. TIME FRAME OF THE INTERVENTION: The time frame of implementing a TQM program is dependent on several factors. The organizational structure, the resources available to change from out-put based to quality-based operations, the actual structure of the facilities, the processes, the product, the suppliers, the employees and finally customer acceptance of the end product. The actual organizational change may occur in a relatively short period, however, the ongoing revisions in the process and the ultimate goal of winning back customers, or acquiring new customers, may take years to complete. It is important to keep in mind that a successful TQM program is an ongoing program, which involves all phases of the organization at all times until the organization is no longer viable. If a TQM program is to succeed quality has to become the culture for the organization (Deming, 1986; Weaver, 1991; Cartin, 1993; Creech, 1994; Reylito, 1999; Clark, 2000). 9. TIME FRAME OF THE ANTICIPATED CHANGE: The time frame for TQM programs are in theory endless. According to proponents of the intervention, the intervention by nature requires that the organization change in such a way that rather than being a quick fix with immediate results, it becomes the way to solve all problems with beneficial long-term outcomes. According to Robert Heller (1995), the key word is “long”. You can win quick and great benefits from TQM, but establishing a lasting culture takes several years. Most successful TQM programs see documented results within the first few years after implementing the programs. However, for some organizations the market climate may be such that immediate results are virtually nonexistent and success can only be measured in the continual survival of the company. This is not to imply that TQM is an all or nothing

intervention, throughout implementation of the program it is necessary to set small obtainable goals, which have to be achieved before the entire organization is completely quality oriented. The most common short term goals achieved are reductions in operating cost, reduction in inventories, decreases in product cycle time and decreases in the number of reworks (Hakes, 1991). 10. RESOURCES TO CONDUCT THE INTERVENTION: Implementation of TQM programs may require tremendous resources, including capital, people, and mostly time. In some organizations implementation of a TQM program required the total restructuring of the organization toward a more de-centralized structure. Resources may also be required if the physical structure of the organization (i.e. facilities) need to be changed in order to facilitate the necessary process changes. Training programs are also key to the success of quality programs. There is little argument that to successfully implement TQM programs, requires a huge investment of time, indeed time is the one resource that all organizations will require if they are going to be successful at implementing a TQM program (Creech, 1994). 11. EXPERTISE OF CONSULTANTS: Many organizations attempt to implement TQM programs without assistance from outside consultants, with mixed results. Many organizations bring in technical consultants to identify problems with the processes, and the product. In addition to technical assistants managers often seek out consultants to assist in the empowerment and training of employees. Although there is no research to indicate specific consulting needs, it is important for the leadership to seek advice from qualified individuals. Ideally, consultants should have experience in guiding the organization away from out-put production techniques to team based quality programs. 12. DO PARTICIPANTS NEED TO PREPARE: In order for TQM programs to work they must be accepted and taken into the very core of the organization. This involves communicating the need for change to every person in the organization. The success of the program depends on its acceptance by the employees and management as the right method to remain competitive. It is important that employees are prepared to assume the role of managers within the organization, because TQM requires that all employees be able to recognize and correct problems in the process. In addition, employees must be prepared to accept the possibility of job loss, and the need for additional training. Empowerment of the employee means that each employee be prepared to assume responsibility for their own work and the work of others in order to guarantee success. The entire focus of the organization shifts from focusing on the individual to focusing on the system as a whole. The emphases of TQM is on group performance, it focuses on changing the system and the total work process not the individual workers productivity. 13. HOW IS THE INTERVENTION CONDUCTED: o According to Deming (1994) to succeed in implementing a quality program a company must adopt a 14-point system at all levels of the organization. These points are: 1.

Drive out Fear: The organization must communicate the plan of action to every employee, supplier, including short term and long-term goals. If the program is to

2.

be totally accepted management must communicate to the employees their vision for the future. Eliminate quotas and numerical goals: According to Deming, quotas and numerical goals force employees into an out-put frame of mind, leaving little chance of quality thinking.

3.

Break down all barriers between departments: In most centralized organizations there are definite lines of communications that must be followed and a division of labor according to departments. In order to implement a TQM program requires that the organization move toward a de-centralized system in which communication between departments is frequent and ongoing. In many organizations, this meant the creation of work teams and quality circles in which each employee’s inputs were actively sought and followed up on.

4.

Eliminate inspection. Learn to build products right the first time: This is perhaps the hardest point in the implementation of TQM. According to Creech, (1994), inspection of products is necessary until that point in time when the processes and the product is at the highest possible quality. Only when the product is quality can inspection be eliminated. The idea that one can learn to make a product right the first time is great in theory, but often it takes many prototypes and revisions before the product is superior in quality. In addition to the need to design and try the products for production, improvements may be needed and the easiest way to measure if the improve- ments are effective is to inspect the product before releasing it to market.

5.

Institute a vigorous program of education: This means that the company must educate all people involved in the implementation of the program as to the purposes, the ultimate goal of the program, and the anticipated benefits for everyone involved with the organization. This education may involve training managers and employees to work together to achieve quality. Often management must be educated in the workings of team based production systems, and employees must be educated on how to work effectively in teams. Without education as to the purpose, and benefits of the program, employees and managers alike are likely to sabotage the entire program before it is fully implemented (Hakes, 1991; Kanji, 1990; Maccoby, 1992; Wilkinson & Witcher, 1993).

6.

Remove barriers that rob workers of their right to pride of workmanship: According to Deming, organizations often fail to recognize employee contributions to the bottom line. If TQM is to be successful employees must have a sense of accomplishment and pride in the product they are producing. In order to foster this sense of pride the organization must empower the employees. Empowerment means that each individual employee has the knowledge and training to inspect his or her own contributions and make necessary improvements (Blake & Mouton, 1981). Management’s job is to recognize each employee’s unique contributions to the process and to recognize employees for their contributions to the overall quality of the product. (Hall, 1987). In Deming’s

program, performance appraisal systems are inappropriate measures of employee contributions. Performance appraisals should be used to measure product performance not individual employees. In order for TQM to succeed management must instill a sense of pride in their employees. This sense of pride can be realized by creating a vision of the future to which employees can strive. Harley Davidson created such a vision for their employees, “Well made in America” meant that employees were rewarded for reducing the overall number of reworks and scrap components, while working toward making a Harley Davidson the best made motorcycle in the world. This quality focused incentive program led to a greater commitment and pride in producing quality above quantity (Reid, 1990). 7.

Institute leadership: The aim of leadership should be to help people do a better job: This is perhaps the most vital part of any TQM program. Leadership serves as the role model for the rest of the organization. If the leadership is not fully committed to quality, the program will fail (Juran, 1989). According to Cartin (1993), the critical role of managers is to understand the TQM philosophies, tools, and techniques, and regularly participate in their application at every level of the organization. The old analogy of a company leader being the captain of the ship is no longer appropriate. The leader of an organization cannot just set the course and bark orders when corrections are needed. He or She must set the objectives but solicit the employees on the best methods of reaching the objectives. This willingness to lead instead of manage is key to the success of the program.

8.

Eliminate slogans, exhortations and production targets: In order to do this the leadership must be willing to let the quality process take hold regardless of the time constraints. Deming and others argue that in successful TQM programs the production will surpass any possible production targets the leadership might set. The idea that quality is worth the wait is central to the success of the program, production targets shift employees’ attention away from quality and toward outputs thus reducing the overall quality of the product.

9.

Adopt a new philosophy: According to Deming, the organization must adopt a new philosophy, which has quality at its core. This new philosophy should provide the vision and direction of the company and its employees. Failure to make quality a philosophy of business means that the whole system will crumble upon itself. “The philosophy of the organization is the center pillar on which the TQM program is built upon, without which the entire system falls to ruin” (Creech, 1984).

10.

End the practice of awarding business based on the price tag. Move toward a single supplier for any one item. Base this long-term relationship on loyalty and trust: One of the keys to successful implementation of TQM programs is identifying your suppliers, and communicating your philosophy and visions to them. According to Deming organizations must end the practice of selecting

suppliers based on price. The organization must seek out suppliers that share their vision of quality and build a relationship with these suppliers built on loyalty and trust. This is a crucial step in insuring that the implementation of a quality program succeeds. The structure of organizations is such that often completion of a single product may involve the utilizing the products of several different organizations. This dependence on others for the necessary parts or services means that organizations must actively seek out suppliers who are willing to meet the quality standards required, and abandon those suppliers whose products are sub-standard (Burt, 1989). Often the failure of TQM programs can be traced back to poor quality parts of services from suppliers (Gurnani, 1999). 11.

Improve constantly and forever the system of production and service: This is perhaps the heart of any successful TQM program. Improving the quality of the product or service is key to remaining successful. The implementation of quality programs means that the processes and products are constantly measured against the products of competitors. If an organization is to remain competitive they must implement improvements in the entire production system. Quality must encompass all phases of production, including improving technology, processes, machinery, and communication throughout the entire system (Hill & Collins, 1999).

12.

Put everyone to work to accomplish this transformation: As mentioned earlier, the implementation of a TQM program involves every person in the organization. Leaders must work to ensure that every person is contributing to the success of the program, from the janitor to the CEO (Savolainen, 2000). The implementation of a successful TQM program hinges on the willingness of all involved parties to actively pursue quality.

13.

Institute job training: Training new employees in quality production is central to a successful TQM program. When instituting a training program, management must determine, when to train and what to teach their employees. There are two general approaches that identify when to train. One is to determine the kind of TQM training appropriate for the various classifications of employees and then to train all employees. Every employee is then equipped to be effective in the analysis of his or her own job and is prepared when he or she becomes a team member. This approach is somewhat mechanistic and, for large organizations, less effective. It has been the experience of organizations that used this approach, that if skills are not applied a short time after training they are lost. A more effective approach is what the Northrop Corporation calls just-in-time training. After each team is formed, it is trained in the skills needed to begin, and then during its operation, it is trained further as specific new skills are needed. The learning is then immediately reinforced through application (Cartin, 1993). In order to be successful a team or individual must know how to solve problems, know the processes, know the work rules, how to plan, conduct good meetings, manage logistics and details, gather useful data, measure process performance, analyze data, implement change, and measure its effectiveness. The ability to do

these things effectively is called having the soft skills of decision-making and problem solving. This is compared to the many hard skills of various job specialties, which are traditionally all that are taught. Implementing TQM involves a planned change form one management system to another that is quite different. It is a management process improvement. Everyone in the organization from the top down must understand its scope direction objectives and methodologies. It requires extensive ongoing training, this training must be planned so that all the required skills are identified and scheduled. The plan must also be able to identify the resources required. . If employees are not trained to think in terms of quality, they cannot recognize the need for changes within the process. Training employees to be aware of the process and what the end result should be is crucial. Too often organizations fail to realize that employees can be taught how to make the product, but they may not b able to move form making the product to improving the product. Training is necessary and should be ongoing if the organization is to maintain a quality driven production. 14.

Create constancy of purpose toward improvement of product and service to become competitive and to stay in business and to provide jobs: Although the implementation of TQM programs often means the loss of jobs, the key success is to communicate the purposes of the lay-offs and to emphasize that layoffs may be a necessary part of the program. The ultimate goal of TQM is to increase the quality of the product in the hopes of remaining in business and to become competitive in the market.

**Note: In practice most organizations tailor their TQM programs to meet their own organizational needs and goals. Deming’s original fourteen points serve as a basis for designing these programs. As noted by Creech (1994), “Although, the name Total Quality Management now covers a very broad tent encompassing all sorts of management practices and has become the buzz phrase to describe a new type of quality-oriented management, there are no bad TQM programs, only incomplete programs that lack in the total involvement of all employees and all processes within the organizations.” According to Creech, all TQM programs must meet four criteria if they are to be successful: first they must be based on a quality mindset and quality in all activities at all times (every process and every product), second, they must be strongly humanistic to bring quality to the way employees are treated, included, and inspired; third, TQM must be based on a de-centralized approach that provides empowerment at all levels especially at the frontline, so the enthusiastic involvement and common realities are realities and not slogans. Finally, TQM programs must be applied holistically so that its principles, policies, and practices reach every nook and cranny of the organization. 14. RESISTANCE TO CHANGE: Employees generally resist TQM programs for two major reasons-they believe that is will cause job loss and that management would refuse to share the fruits of such programs. If the employees (union members or not) are not consulted or involved, it will likely reinforce the same perception-that TQM is a threat to their well being, or the union organization, or both. It is only through greater level of employee involvement and commitment that management can ensure the success of TQM. This resistance to change may be minimized by empowering the employees to

act independently or in groups to implement changes needed to insure the success of the program. 15. MAINTAINING CHANGE: As previously noted TQM programs are not quick fixes that disappear after the organization has regained its original standing; successful TQM programs change the entire organizational culture, to one of quality. Given this fact, maintaining change is relatively simple. During the reorganization phase of the program, the organization has either dismissed or retrained employees who insisted on the old way of doing business, with this new mindset, and continuous improvement at the core of the program, TQM programs become the way things are done at the organization, therefore maintaining change is not difficult to achieve. 16. FOLLOW-UP: TQM programs by nature dependent on constant follow up. Following the product throughout the entire production process is crucial to maintaining the quality of the product. If changes are implemented in the process, follow up must also be implemented to ensure that the change leads to improvement of the product. Failure to follow up on product changes can lead to substandard products and less customer satisfaction. To implement follow up on the effectiveness of TQM programs, management must facilitate feedback from within the organizations and create opportunities for customers to provide feedback to the company. Harley Davidson sponsors Bike Weeks, through which they actively seek follow up information from their customers (Reid, 1990). 17. SPECIAL CONSIDERATIONS/CRITIQUE: Although many organizations utilize TQM programs, they are often modified versions of Deming’s original concept. Since it conception Total Quality Management has become the buzzword in business, however, few organizations embrace the philosophies of TQM fully. In most organizations, TQM principles are applied to the processes and product, but not the employees. Many spin-offs of Deming’s original principles abound in organizations worldwide, examples of which include ISO-9000, Sigma-Six, a Taughchi systems.

REFERENCES FOR TOTAL QUALITY MANAGEMENT Anderson, J. C., Rungtusanatham, M., & Schroeder, R.G. (1994). A theory of quality management underlying the Deming management method. Academy of Management Review, 19, 472-510. Blake, R. R., and Mouton, J. S., (1981). Productivity the human side. New York:AMACOM. Briggs, S. & Keosh, W., (1999). Intergrating human resource strategy and strategic planning to achieve business excellence. Total Quality Management. 27, 473-485. Burt, D.N., (1989). Managing suppliers up to speed. Harvard Business Review, 17. Cartin, T. J., (1993). Principles and practices of tqm. Wisconsin: ASQC. Clark, S., (2000). Decades later, TQM is still key to success. Memphis Business Journal, 21,1920. Creech, B., (1994). The five pillars of tqm. NewYork: Dutton. Dahlgaard, S., (1999). The evolution patterns of quality management: some reflections on the quality movement. Total Quality Management, 12, 473-485. Deming, W. E., (1986). Out of Crisis. Cambridge, MA: MIT press. Hackman, J. R. and Wageman, R. (1995). Total quality management. Public Administration Review, 54, 129-136. Hakes, C., (1991)., Total quality management: the key to business improvement. London: Chapman. Hall, G., (1987). How to make reengineering work, Harvard Business Review. 119-131. Hayes, R. H., Wheelwright, S. C., and Clark, K.B., (1988). Dynamic manufacturing: creating the learning organization. NewYork: Free Press. Heller, R., (1995). The heart of the quality matter. Management Today, June, 25-29. Hill, S. & Collins L., (1999). Total quality management and business process re-engineering: a study of incremental and radical approaches to change management at BTNI. Total Quality Management, 10, 37-56. Juan, J. A. M., (1989). Juran on leadership for quality. New York: Free Press. Kanji, G. K., (1990). Total quality management: the second industrial revolution. Total Quality Management. 1, 3-12.

Maccoby, M., (1992). Creating empowered organizations, Research Technology Management. 35, 50-51. Mckee, B., (1992). Turn your workers in a team, Nations Business, 80, 34-38. Reid, P. C., (1990). Well made in America: lessons from harley-davidson on being the best. New York: Mcgrall Reylito, A. H., (1999). In the workplace: tqm and labor relations. Business World (Philippines). 22-25. Ross, J. E., (1993). Total Quality Management: text, cases, and readings. Florida, St. Lucie Press. Saraph, J. V. and Sebastian, R. J., (1993). Developing a quality culture. Quality Progress. 26, 9, 73-78. Savolainen, T., (2000). Leadership strategies for gaining business excellence through tqm: a finnish case study. Total Quality Management, 10,2, 211-230 Scherkenbach, W., (1990). The deming route to total quality and productivity: road maps and roadblocks. MD: Mercury. Solomon, R.J., (1996). Organizational culture is the key to total quality management. American Medical News, 39, 32-34. Tatar, J., Prasad, S. & Thorn, R., (1999). The influence of organizational structure on the effectiveness of tqm programs. Journal of Managerial Issues, Winter, 440-454. Weaver, C. N., (1991). TQM: a step-by-step guide to implementation. Wisconsin:ASQC. Wilkeson, A. & Witcher, B., (1993). Holistic total quality management: take account of political processes. Total Quality Management, 4, 47-56.

Employee Empowerment Programs (prepared by Irena Pashaj) This intervention is also known as: Employee Involvement Intervention Employee Empowerment Quality of Work Life 2. TARGET LEVELS OF ANALYSIS: Employee Involvement may be perceived at individual level, such as the relationship between subordinate and supervisor. It may also be viewed at group, unit or departmental level, such as a group working together to achieve a common goal, or at organizational level (Brady, 1989). The level of involvement taking place in an organization might be determined by the number of employees participating in the intervention. Brady (1989) believes that it is at the individual level, i.e. subordinate, that we can really determine the scope of employee involvement in decision-making process of the organization. Involvement does not exist unless the individual feels that his or her decisions and actions are actually affecting the issues and problems that are of importance for the organization (Brady, 1989). Brady (1989) suggests that counting the number of employees in the group is not the way to determine the level of involvement in an organization. Thus, Brady (1989) implies that the best way to ascertain the level of involvement is by determining the number of employees who truly believe that they are influencing those areas, that employees themselves, their coworkers and management consider important. Brady (1989) concludes that there are at least three levels of employee involvement: 1. Individual. This level is concerned with the individual performance in their jobs. 2. Unit/department. This level applies to performance at the unit or departmental level. 3. Organization. This level pertains to issues and policies concerning the entire organization. Different conditions will determine the level of employee involvement. Thus the latter should fit the goals and objectives of the intervention. 3. PURPOSE OF THE INTERVENTION: The main purpose of employee involvement intervention is to move the power and decision making to lower levels of the organization in order to improve the participation, responsibility, and efficiency of employees. It anticipates extensive employee participation in decisions that influence organization success and employee welfare (Glew, O’Leary-Kelly, Griffin, and Van Fleet, 1995). EI involves the participation of all employees so that the latter experience the feelings of pride, confidence, and trustworthiness. Lawler (1986), identified four essential elements that advocate employee involvement: 1. Power. This element involves presenting employees with the authority to make decisions concerning work-related issues, such as task assignment, productivity outcomes, selection, and so forth. Depending on the amount of authority that employees are able to afford, the level of this power will vary tremendously.

2. Information. Immediate access to appropriate information is critical in making efficient decisions. 3. Knowledge and skills. Employees must have the necessary knowledge and skills to make the right decisions. If they lack these requirements, organizations must offer training and development programs to improve their knowledge and skills. 4. Rewards. They are powerful tools in involving people to participate in the organizational issues. The rewards can be external such as pay and promotion and/or internal such as feelings of fulfillment and self-respect. Paulsen (1994) suggests the use of group-based bonus arrangement or gainsharing system as a means of making EI intervention very effective. These four elements determine the extent to which employees will participate in decision making process, thus clearly influencing the EI effectiveness. EI would be more successful if all four elements are moved to lower levels of organizations. The elements are interdependent with each other. So, they require being changed together in order to attain accurate results. Management support is identified as another important element of EI (Brady, 1989). Management should be willing to facilitate employees’ participation in decision-making process. Sigvard Rubenowitz (1992), as cited in Blair and Meadows (1996), identified three essential aspects in which the managers must act in order to support the EI intervention: 1. Managers must focus at the same time on three strategic areas: the directing system of the technological and administrative environment; the organizational structure; and interpersonal relationships. 2. They must pay attention to employees’ need for training. 3. They must be considerate of the supervisors who are undergoing fundamental changes, and include them in the process and offering them training for their new role. 4. EFFECTIVENESS CRITERIA: Employee involvement affects employee satisfaction, quality improvement and productivity enhancement (Pun, Chin, and Gill, 2001). Lawler and Ledford (1982) have suggested that EI intervention affects productivity by way of improving communication, motivation and capabilities, which in turn affect productivity. Employee involvement has a positive influence on other company objectives, such as greater teamwork within and among departments and better communication of goals and results (Paulsen, 1994). Organizational citizenship behaviors are also found to be an effective outcome of employee involvement (Cappelli and Rogovsky, 1998). 5. EVIDENCE OF EFFECTIVENESS: a. Pun et.al. (2001) conducted an empirical study involving Hong Kong organizations, which they gave a survey intended to identify factors and benefits of EI implementation. They looked at electronics and plastics manufacturers. The authors reported the mean ratings of these factors and outcomes, which was based on a five point scale (1 = the least important; 5 = the most important. The results showed that for electronics manufacturers, employee satisfaction was the most important outcome of employee involvement with a mean rating ranging from 3.86 to 3.96. This was followed by quality improvement and productivity enhancement. For plastics manufacturers, quality improvement with a mean rating of 4.25 and productivity enhancement with a mean rating of 4.17 were more important than employee satisfaction.

b. Case studies: 1. Lakewood assembly plant (Kouzes and Posner 1995). Lakewood assembly plant outside Atlanta was shut down for a year and a half because of a decline in car sales. Employees were obliged to seek and find new jobs in other plants all over United States. Patricia M. Carrigan, who was the first female assembly plant manager in the history of General Motors, realized that the plant needed a completely new approach. Under her leadership, employee involvement intervention was implemented throughout the plant. First, management worked together with employees in developing start-up training for all employees. Also, employees played the role of facilitators in the process. Second, management worked closely with union to encourage employees to continue to participate in the program. There were 133 voluntary work groups, who concentrated on planning and solving problems. Third, an ongoing training program was developed for Lakewood employees. The skills of more than 3,000 employees were improved in 360,000 hours of training. In the first published audit after the makeover, Lakewood was the first plant in the history of GM to receive a widely accepted corporate standard for high quality. Grievances decreased, absenteeism declined tremendously, sickness and accident cost were lowered by two-thirds. These results are evidence of the joint involvement of management and labor at Lakewood assembly plant. 2. Harley-Davidson Motor Company (Young and Murrell 1998). During the mid 1970s and early 1980s Harley-Davidson motor company had a reputation for poor quality. An organizational development intervention was needed, so the company instituted the Productivity Triad Philosophy, which was a new management philosophy. An important element of the productivity triad was employee involvement intervention. Union- Management programs and work teams were implemented to encourage employee involvement and participation in problem solving process. Employees were held accountable for their work and decisions on work-related issues. The intervention stressed mutual trust and respect, open communication between employees and management and commitment to the company. Training and development was also an important part of this OD intervention. This intervention in joint with other parts of the triad not only saved the company from bankruptcy, but also improved production and quality tremendously. 6. HOW/WHEN WILL OUTCOMES BE ASSESSED: A survey can be given to participants asking if they feel in control of the situation and if they are able to make decisions concerning their work (Spreitzer, 1996). Examining the behavior of the employees during critical incidents is another suggested way of assessment (Mainero, 1986). Another approach is evaluating the degree to which employees work under conditions that promote empowerment (Spreitzer, 1996). An example of these conditions could be a manager who allows employees autonomy to make decisions by themselves. The above approaches of EI intervention can be conducted during the time of the intervention. Evaluation must also be carried out in the beginning and the end of the intervention and results must be compared to see if any change in the level of employee empowerment occurred. 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS:

EI intervention encompasses a wide variety of participants. Participants vary from blue collar to white collar; from old employees to new employees; lower management to higher management; from no education to college graduates. The main goal of EI intervention is to highly involve employees in the lower levels of the organizations and give them the authority to make decisions by themselves. But, first-line supervisors can not perform efficiently if they lack the necessary information and have no control over the supplies for their unit (Kanter, 1979). The same holds true for middle managers who need to have the power necessary to perform their job effectively. Beside employees, managers are not the only ones who require some authority to do their job well. Staff specialists such as planners as well as engineers and technical specialists will not be able to contribute enough if they do not have the needed power to make the necessary decisions (Kanter, 1983). 8. TIME-FRAME OF THE INTERVENTION ITSELF: Employee Involvement can be considered an ongoing intervention. It will last as long as the organization experiences the anticipated change. Thus, it can range from twenty four hours to a decade depending on the level of change of the organizations and resources available (Lawer, 1992). 9. TIME-FRAME OF ANTICIPATED CHANGE: Sometimes, change can be so dramatic, that it changes the entire organization overnight. This is a very high-risk strategy, but it can be effective when the organization needs such a fast change. General Electric and Motorola plants are examples of such change, where the old organization is shut down and a completely new organization is created (Lawler, 1992). But, these are very rare cases. Most organizations do not change overnight, neither in a week, nor a month, or a year. It takes years, it may take a decade to see and enjoy the positive results of EI intervention (Lawler, 1986; Lawler, 1992). 10. RESOURCES TO CONDUCT INTERVENTION: • People are the most important resources in implementing EI intervention. High-involvement organizations prefer highly motivated employees who are able and willing to learn new skills and solve work-related problems (Lawler, 1992). • Human resource systems such as selection, training, and career development are another resource. These systems are important because they determine future employees for organizations (Lawler, 1986). • Technology is also critical because the EI intervention focuses on creating work settings that foster intrinsically motivating work, thus making employee feel more satisfied with his or her work (Lawler, 1992). • Time is another critical resource. Management must offer employees enough time for their activities, thus giving the message to employees that management is considerate of their efforts (Brady, 1989). • Management support is essential because it is through managers that most of the employees’ needs for this process are made possible. For example, managers are the ones who make training possible (Brady, 1989). • Money will determine the depth of the intervention and the time spent in implementing it. For example, the extent of the training program will depend on the budget available.

11. EXPERTISE OF THE CONSULTANT: N/A. 12. DO PARTICIPANTS NEED TO PREPARE: Employees and management need to get together, discuss the new intervention and prepare to get involved in implementing it. In most cases, employees and managers require proper training in order to properly analyze the problems of the organizations and offer suggestions (Lawler, 1992). Training could be in technical area and/or interpersonal relationship in order to facilitate decision making and solution implementation. Employees are informed that they are responsible for their own actions and their decisions on work-related issues will affect them as much as it will affect organization as a whole. 13. HOW IS THE INTERVENTION CONDUCTED: Once the decision is made to implement the employee involvement intervention, it is critical that objectives, goals, structure, focus, and limitations of the program are clearly defined and clearly communicated to everyone involved. Employees should have the opportunity to share their opinions and decisions on issues that concern their performance and work area (Paulsen 1994). There are different approaches of EI intervention: 1. Quality Circles. Quality circles or employee involvement teams, were one of the most popular EI interventions in the 1980s (Lawler, 1986; Lawler, 1992). They were originally developed in Japan in the mid-1950s and were adopted by American organizations in the 1970s as a way of competing more efficiently with Japanese companies (Lawer and Mohrman, 1985). Quality circles were very successful in improving product quality in Japan. These results attracted the American companies to start implementing this type of EI intervention. But, Japan in contrast to the individualistic United States, has a very collectivistic culture, which nurtures the quality circle. This difference in culture makes the process of implementing the circle approach more difficult in United States, which is characterized by individualistic and independent thinking (Munchus, 1983). Quality circles consist of small groups of volunteers from a certain unit or department with three to fifteen members each. Usually there are more volunteers than openings in the circle, so some employees are not approved to participate, at least early in the process. Later, participation changes when circles stop meeting and new circles are created in the same unit or department. Now, the employees that were refused membership earlier can participate in these new circles. Circles meet for about one to two hours once in two weeks on company time. Later in the process, they may meet more often (Lawler, 1992). Training is an important aspect of quality circles. Initially, members are trained in identifying and analyzing problems, and in problem-solving techniques. Training involves ten to twenty hours per member and company might use training packages usually offered by consultants (Lawler, 1992). Each circle has a leader who leads the group meetings and facilitates discussions. Another important feature of quality circles is the facilitator, who coordinates the activities of different circles. The various circles within the organization are called parallel circles (Lawler, 1992).

Early utilization of quality circles was mostly in blue-collar areas. Nowadays, white-collar participant and technical areas are also using quality circles. In both blue-collar and white-collar cases, management does not take part in this type of intervention (Lawler, 1992). Quality circles aim at improving product quality. They do not focus on quality of work life. They are restricted to identifying, analyzing and recommending solutions on product quality only, may be sometimes productivity (Lawler, 1986). Whenever members of quality circles suggest useful ideas, they are not directly financially rewarded. They are paid for the time since they meet on company time and they are often recognized with awards other than monetary. This is the same model as the Japanese one where employees are rewarded with symbols, pictures, banquets and so forth (Cole, 1989). 2. Work teams. This approach originated from Europe, specifically Britain. A case was reported from the British coal industry, where workers created their own team. Members of the team helped each-other while working and high productivity and job satisfaction were reported. Work teams were adopted in United States in the 1970s (Lawler, 1986). Membership is not voluntary. A team comprises of all employees in a particular area. Just like in job enrichment, employees are responsible for working on the whole product or service (Hackman & Oldham, 1980). Training is very important for successful work teams. Employees receive task training in order to perform multiple duties, and interpersonal skill training to facilitate the communication and interaction among group members. Work teams meet in scheduled meetings once a week (Lawler, 1992). Initially, a leader is either appointed or voted by members and he or she helps the group in making critical decisions. As the team evolves, the role of leader changes. Now he or she plays the role of the facilitator (Schlesinger 1982). Work teams use a reward system of skill-based pay. Employees are paid according to the number of tasks they perform (Lawer and Ledford, 1985). Some teams are more autonomous than others are. Highly autonomous teams make critical decisions such as hiring, firing, and determining quality and work methods and so forth. In less autonomous teams, management determines the above decisions. These teams deal with setting productivity goals, deciding on the types of work methods and so on. According to Lawler (1986), effective work teams can: • Improve work methods and procedures • Increase staffing flexibility • Increase service and product quality • Improve rate of output • Reduce the level staff support • Reduce supervision • Improve decision making According to Paulsen (1994), an employee involvement team should follow these guidelines: * The group consists of 4-7 employees * Holds regular meetings. * One person facilitates the process by directing the group. But, each member has equal influence in making decisions concerning the group.

* * * * * *

The team discusses various work-related issues and solves those problems that are under its control Identifies, analyzes, solves problems Recommends solutions. The team proposes solutions to problems that it considers critical, but it is the management that enjoys the decisionmaking authority. Members are trained to utilize systematic, problem-solving techniques in identifying problems, making decisions and implementing solutions Uses focused action plans to carry out solutions Monitors execution of solutions

Employees will pay close attention to work-related issues that they find critical or of main concern to their work place and will carefully evaluate them and take action if necessary. As long as the team is focusing on important issues and is considerate of the interests of the organization, it is essential that management does not impose issues or solutions to the employees involved in the program. 3. Union-Management Programs. These programs are similar to Quality of Work Life programs. In United States, union-management programs were created during World War II. Once the war was finished, these programs also died. They came back in early 1970s (Lawler, 1986). The goal of union-management programs is to improve quality of work life and productivity through dual involvement of union and management (Davis and Sullivan, 1979). Lawler (1992) identified the following characteristics of Quality of Work Life programs: • Committee Structure. The committee, which is made up of top level management and union representatives, is at the center of most projects. It focuses in directing activities that improve quality of work life and organizational effectiveness. Also, committee expresses concern about increasing productivity and improving quality. Sometimes it is necessary to create more than one committee in order to assist different areas of the project in different levels of the organization. • Agreements. Management and union representatives sign a letter of agreement, which states that no employee loses his or her job because of the project. The agreement also states that the program will not interfere with collective bargaining issues. • Objectives. QWL have three objectives: union, management, and joint objectives. • Training. QWL focuses on general training for all employees involved in the project. 4. Job Enrichment. This approach focuses on making work more interesting. It consists of allowing the employee to be responsible for the whole product or service. When employees feel that their work is important and useful, they feel more motivated and more satisfied. Lawler (1986), identified five job-design characteristics that challenge employee’s skills and make the employee feel important: • Autonomy

• Feedback systems • Skill variety • Task identity • Task significance Through job enrichment approach, lower levels of employees feel that they have the authority to make decisions that affect their individual jobs (Lawler, 1986). 5. High-Involvement Organizations (HIO). HIOs are characterized by high consideration and high involvement of employees in critical decisions that affect all aspects of the organization (Lawler, 1986). Employees are treated with respect by management and are trusted to make important decisions about their job or the organization. Projects are designed by both management and employees together. Below is a list of design features characterizing HIOs as identified by Lawler (1986). • An organic, flat organizational structure makes possible the flowing of information among different levels of organization and fosters the involvement of employees in making suggestions and decisions on various issues. • Enriched job design gives the employees the authority to make changes necessary in their individual jobs. • Training is essential in HIOs, since these interventions focus on growth and development. The organization needs to offer training to develop needed technical skills and interpersonal and problem-solving skills. • Career system is important in facilitating the success of the intervention. Organizations must clearly communicate to employees the career options and the skills they need to achieve the wanted careers. Here is a good opportunity for offering training. • Selection system is where it all starts. Thus, organizations must pay closer attention to the procedures they use to select employees. Giving the applicant a realistic job preview is suggested to be a very important step in improving the selection system. • Reward system in HIOs is different from the one used in traditional organizations. It focuses on skill-based pay, gainsharing, profit sharing, flexible benefits, and employee ownership. • Personnel policies in HIOs should fit the local work force. The support staff must pay close attention to issues such as type of benefits offered, flextime, discipline, and layoffs. High-Involvement Organizations have shown to be highly effective for the organization by improving quality life, productivity, product quality and decreasing grievance rate (Lawler, 1992). 14. RESISTANCE TO CHANGE: In order for high involvement organizations to be successful, organizations must be willing to make enormous changes in such areas as internal systems, operating procedures and so forth. The resistance to change starts with high level managers, who fail to provide leadership to employees in implementing EI. Lawler (1992) identifies some of the reasons for change resistance: • Major change in an organization takes quite a long time to produce impressive results, and senior managers are not going to be in their job for so long.

• Managers do not want to lose the power, authority and rewards that they enjoy from their positions (Lewis, 1998). • They have used and perfected their old skills for a very long time and these skills are effective only in mechanistic organizations. Senior managers are not the only ones that resist change. Employees can be as resistant to change as managers can. Changes in the organization require that employees be more involved with organizational issues and actively express their opinions. But, that means that employees need to change their old behaviors and habits (Corsentino and Bue, 1993). Not all employees are willing to change their old behaviors and not many are willing to take responsibility for their actions. Thus, they are going to resist change and this will make it harder for the new intervention to be implemented. Some employees are just incapable to accept responsibility for change. Another reason that employees resist change, is the stress they experience while working in a highinvolvement environment. Usually, employees are able to overcome this stress. But in situations over which the employee thinks he has no control, stress can be debilitating (Kahn, 1981). Lawler (1992) found that managers are more resistant to change than employees. 15. MAINTAINING CHANGE: Senior managers should be trained to learn new skills so they can adapt to the new, organic organizational structure. They must learn to give up some of the privileges that they have enjoyed so far (Lawler, 1992). Organization must create environments that are friendly and make the employee feel comfortable and in control of the situation. This would lower stress level of employees and they would be more open to change. Change does not happen overnight. On the contrary, it requires a very long time before managers and employees can see the result of their work. This mission should be clearly transmitted to all individuals involved in the program, so they know what to expect and avoid disappointment (Lawler, 1992). Once the change starts, it is important that it includes all areas of the organization in order to balance power, information, knowledge, and rewards. 16. FOLLOW-UP: EI is an ongoing process and since it involves employee participation, it needs to make sure that employees continue to stay active in decision making process even after the positive results (Lawler, 1986). If the organization does not follow up, there is a high chance that employees would fall back to their old habits, where they were before the intervention. 17. SPECIAL CONSIDERATIONS/CRITIQUE: • There is no one EI project that would fit all organizations, so each organization must develop its own version. This makes it hard to convince managers and employees to participate in the EI project (Blair and Meadows, 1996). • Organizations must be careful not to move faster than they should in implementing the EI intervention. Enough time should be given to proper training of necessary skills needed for successful results (Blair and Meadows, 1996). • Adequate time and money must be invested in training (Blair and Meadows, 1996).

• Employees’ priorities during involvement process must be in congruence with those of customers (Blair and Meadows, 1996). REFERENCES FOR EMPLOYEE EMPOWERMENT PROGRAMS: Blair, G., & Meadows, S. (1996). A real-life guide to organizational change. England: Gower Publishing Limited. Brady, Gene F. (1989). Management by Involvement. New York, NY. Human Sciences Press. Inc. Cappelli, P., & Rogovsky, N. (1998). Employee involvement and organizational citizenship: implications for labor law reform and “lean production”. Industrial and Labor Relations Review, 51, 633-654. Cole, Robert. E. (1989). Strategies for Learning. Berkeley, CA. University of California Press. Corsentino, D., & Bue, P. T. (1993). Employee involvement: implementing quality change. The FBI Law Enforcement Bulletin, 62, 10-12. Davis, L. & Sullivan, C. (1979). A labor-management contract and quality of working life. Journal of Occupational Behavior 1, 29-41. Glew, D., O’Leary-Kelly, A., Griffin, R., & Van Fleet, D. (1995). Participation in organizations: a preview of the issues and proposed framework for future analysis. Journal of Management, 21, 395-421. Hackman, J. R., & Oldham, G. R. (1980). Work Redesign. Reading. MA. Addison-Wesley. Harrison, M., & Shirom, A. (1999). Organizational diagnosis and assessment: Bridging theory and practice. Thousand Oaks, CA: SAGE Publications, Inc. Kahn, R. L. (1981). Work and Health. New York. NY. Wiley. Kanter, R. (1979). Power failure in management circuits. Harvard Business Review, 57, 65-75. Kanter, R. (1983). The Change Masters. New York, NY. Simon and Shuster. Kouzes, J. M., & Posner, B. Z. (1995). The Leadership Challenge. San Francisco, CA. JosseyBass Publishers. Lawler, E. E., & Ledford, G. E. (1982). Productivity and the quality of work life. National Productivity Review, 2, 23-36. Lawler, E. E., & Ledford, G. E. (1985). Skill based pay. Personnel, 62, 64-71.

Lawler, E. E., & Mohrman, S. A. (1985). Quality circles after the fad. Harvard Business Review, 85, 64-71. Lawler, Edward E. (1986). High-Involvement Management. San Francisco, CA. Jossey-Bass Publishers. Lawler, Edward E. (1992). The Ultimate Advantage. San Francisco, CA. Jossey-Bass Publishers. Lewis, Bob (1998). Employee involvement is losing favor, and for all the wrong reasons. InfoWorld, 20, 88-89. Mainero, L. (1986). Coping with powerlessness: The relationship of gender and job dependency to empowerment-strategy usage. Administrative Science Quarterly, 31, 633-653. Munchus III, G. (1983). Employer-employee based quality circles in Japan: human resource policy implications for American firms. Academy of Management Review, 8, 255-261. Paulsen, K. M. (1994). Total employee involvement - why are you waiting? Industrial Engineering, 26, 16-18. Pun, K. F., Chin, K. S., & Gill, R. (2001). Determinants of employee involvement practices in manufacturing enterprise. Total Quality Management, 12, 95. Schlesinger, L. A. (1982). Quality of Work Life and the Supervisor. New York, NY. Praeger. Spreitzer, G. (1996). Social structural characteristics of psychological empowerment. Academy of Management Journal, 39, 483-504. Young, J. & Murrell, K. L. (1998). Harley-Davidson motor company organizational design. Organization Development Journal, 16, 65-74.

Quality of Work Life Programs (QWL) (prepared by Adeola Oduwole) 2. TARGET LEVEL OF ANALYSIS: Quality of work life programs are organization-wide initiatives. Most QWL programs are designed and implemented based on organizational demographics, structure and goals. These programs are designed to impact the organization as a whole. 3. PURPOSE OF THE INTERVENTION: The primary goal of QWL programs is to improve the overall well being of the employee, while achieving organizational objectives, such as increased productivity. QWL initiatives started in the United States in 1972. It was first described as a movement of participative management and workplace democracy (Davenport, 1983; Feuer, 1989). The premise of the QWL movement (formerly “quality of life” at work) was that increased productivity would result by involving employees in the decision-making process at work (Davenport, 1983). In addition to this, QWL programs were developed to reduce absenteeism, turnover and increase productivity (Martinez, 1997). Although it is difficult to come up with an all-encompassing definition of QWL, many researchers describe QWL in term of its major content areas. For example, May, Lau and Johnson (1999) define QWL companies as organizations that promote job security, employee growth, rewards and employee satisfaction. Overman (1999) suggests that QWL programs fall into two categories. The first category are work reorganization programs. These include things such as restructuring jobs and duties, telecommuting, job sharing, and flextime. The second category are employee benefit policies. These include things such as on-site childcare/eldercare and/or referral services, paid family and medical leave, release time and limits on business travel. Furthermore, Greenfield and Terry (1995) describe QWL programs around six initiatives: Helping employees manage their physical and metal health and helping employee’s care for dependents. Flexible leave policies (e.g. personal days, gradual return to work programs). Saving employees time (e.g. on-or-near-site banking) and supporting employees’ thorough the financial life cycle (e.g. financial and retirement planning). Two common themes emerge in all QWL initiatives: The first is to make working conditions more conducive to employees’ non-work lives. Second, is to increase employee involvement in the decision-making process (Feuer, 1989). 4. EFFECTIVENESS CRITERIA: Prince (2000) says that when it comes to the measurement of work life programs, the idea that you can quantify or ‘count’ the amount of money saved is inadequate. This is because the outcomes to QWL programs are things that cannot be measured, such as, job satisfaction and increased morale. These factors should be taken into consideration when measuring the effectiveness of QWL programs. However, it is important to note that increased productivity is indirectly tied to these factors. For example, May, Lau & Johnson (1999) suggest that an organizations financial performance is linked to the measurement and improvement of such things as employee satisfaction, innovation and productivity. Further, surveys conducted by groups, such as SHRM (Society of Human Resources Management) suggest that the main reason for implementing QWL programs relates to organizational performance, as measured by

recruitment, retention and productivity (Mechelen, 1998). May, et al. (1999) suggest that QWL initiatives fall along two lines: the employer (organizational effectiveness) and the employee (improved working conditions). When both of these objectives are achieved, you have what is called a “win-win” situation. What this means is that there is a positive and reciprocal relationship between QWL and organizational performance, as measured by these bottom-line measures. In a tight labor market, characterized by intense competition for qualified employees, such programs are not just added benefits, but deemed a necessity (Greenfield & Terry, 1995). Overman (1999) supports this view, when he says that the labor market has heightened the need for such programs, and the survival of some companies depends on it. Roberts (1996) says that for companies to be competitive they need to implement some kind of work life initiative. A study conducted by the William M. Mercer Inc. found that over 50% of the 800 companies responding to a work life survey feel that QWL programs positively influence employee morale, attendance and productivity. This survey also found that flextime was a primary aid in recruiting. May et. al (1999) also suggest that companies that offer QWL programs will have the advantage in hiring and retaining qualified workers. These programs are also positively related to customer retention and satisfaction. 5. EVIDENCE OF EFFECTIVENESS: The effectiveness of QWL programs have been tremendous, as demonstrated by bottom-line or firm performance measures. For example, the Dupont Company reports that its family resources program results in a 637% financial return in increased performance, retention, stress reduction, and lowered absenteeism (Rowan, 1997). May et al. (1999) have found that QWL programs result in lowered absenteeism, lower turnover, improved job satisfaction, increased recruitment and competitiveness. The Towers and Perrin study found that over forty percent of employees’ report that QWL programs helped recruiting efforts, and gave impression that the company was a “good place to work.” Thirty percent report that these programs positively influence employee loyalty, job satisfaction, employee awareness, and appreciation of the human resource policy. Approximately 25% of employees say that these programs have increased their productivity and have resulted in decreased absenteeism (Greenfield and Terry, 1995). Further, one expert from the Human Resources Institute says that companies that offer wellness programs (e.g. fitness centers) have fewer absences, lower disability claims, higher productivity and lower insurance costs (Marcus, 2000). Overall, work life programs result in increases in productivity and positive employee perceptions about the organization. Mechelen (1998) found that organizations with QWL programs are considered to be high performing organizations. For example, evidence from both private and public sector companies suggest that QWL programs increase productivity, workforce stability, customer service and reduce costs. Mechelen highlights each of these criteria using a case study of the HewlettPackard company. For this company, a compressed workweek increased profits by fifty-percent. A caregiver assistance also helped remove barriers to work productivity. QWL programs also result in workforce stability. Mechelen (1998) suggests that QWL programs improve recruitment, reduce attrition and absenteeism. For example, companies that offer QWL programs

are seen as more attractive than those that simply offer a higher salary. Employees are reluctant to leave companies that offer these programs, and QWL programs was a persuasive factor in many employees’ decisions to stay with a company. Caregiver’s assistance and flexible work schedules helped reduce absenteeism, and telecommuting expanded the applicant pool, because applicants were no longer restricted by geographic boundaries. In addition, customer service also improved when QWL programs were implemented. For example, telecommuting, which allow employees to deliver services from their homes were valuable in cases where emergencies arise at work sites (e.g. natural disasters). Finally, QWL programs result in reduced costs. For example, flexible work schedules reduce overtime costs and turnover, and reduced turnover leads to fewer dollars allocated to recruitment. This is important when one considers that for one company, it costs 75% of the average salary to replace an employee (Mechelen, 1999). Telecommuting also reduces facility/utility costs. For example, at one company it was estimated that employees who work at home two days a week save the company approximately $12,000 a year in office leases, furniture, and other equipment (Mechelen, 1999). 6. HOW/WHEN WILL OUTCOMES BE ASSESSED: Measurement of QWL programs should be tailored to the organization (Prince, 2000). For example, some companies will evaluate the effectiveness of these programs based on increased retention or recruitment, lower turnover or absenteeism. Others may evaluate these programs based on better customer service. One study evaluated business performance, as indicated by the growth and profitability of QWL companies (companies that promote job security, employee growth, rewards and employee satisfaction) and Standard and Poor’s (S&P) 500 companies (companies that are stable in performance). Growth was operationally defined by five-year (1993-1998) trends on three measures: sales growth, asset growth and maximum sustainable growth. Profitability was defined by five-year trends on two measures: return on assets, return on equity and five-year average profit margin (May et. al, 1999). Results indicated that QWL companies have significantly higher growth rates and higher sustainable growth rates than S&P 500 companies. QWL companies were also more profitable than S&P 500 companies. However, the differences between the two types of companies, in terms of profit margin were not always statistically significant. Overall, there was a positive relationship between QWL and good business outcomes. 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: Traditionally, QWL programs were targeted towards women in the workforce. Specifically, the objective of these programs were to reduce turnover among women (Baker, 1999). However, there is consensus that the issues addressed by QWL programs are those that concern both men and women in the workplace (Rowan, 1997). Baker (1999) says that although the issues addressed by QWL programs are issues that working women have had deal with for the last decade, it is now an issue that many men are also having to cope with. Today, men are placing more emphasis on family time and related issues. For example, Microsoft has started a program called Dads @ Microsoft to help father’s balance work and life demands. Men are now recognizing the need to fulfill family needs as well as those on the job (Baker, 1999). 8. TIME-FRAME OF THE INTERVENTION ITSELF: QWL interventions can be designed for long-term or short-term change. Time frame of the intervention will depend on the specific type of program that is being implemented. For example,

one North Carolina based company with a diverse workforce in which seven languages are spoken offered English classes to alleviate communication barriers. The program ended once there was no longer a need (Calabria, 1995). Other interventions have a long-term scope. Examples would include initiatives such as child care assistance and fitness centers. 9. TIME FRAME OF ANTICIPATED CHANGE: Most QWL programs anticipate long-term and ongoing change. For example, Prince (2000) suggests using the three ‘Cs” of measurement to ensure success of a QWL initiative. These are commitment, choice and communication. Commitment entails an ongoing assessment of employee needs. Choice requires the organization to address only the critical issues. Lastly, communication entails keeping upper management abreast of all work life developments and results. 10. RESOURCES TO CONDUCT INTERVENTION: Costs to initiate and maintain work life interventions are modest (Greenfield and Terry, 1995). For example, alternative work schedules, which are the most valued QWL program cost very little to implement, if anything at all (Mechelen, 1998). Calabria (1995) also asserts that the financial investment for most QWL programs is minimal. For example, Calabria speaks of one company who started a laundry and transportation service that transports employees to and from work. These services together cost approximately fifteen cents per employee per hour ($540 a day). Another company with very limited resources could not afford a full-scale child-care facility. So, what the company did was implement a child-care subsidy, which only cost $85 a month per child. This cost is insignificant, when one considers the benefits of reduced turnover and increased productivity, Calabria says. Overall, companies who are dedicated to work life programs have huge dollar payoffs, and these out weight the actual investments (Greenfield and Terry, 1995). It should be noted that although most intervention may require low resources, others interventions such as large-scale childcare facilities will require greater resources. 11. EXPERTISE OF CONSULTANTS: Not applicable to QWL programs. 12. DO PARTICIPANTS NEED TO PREPARE: In preparation for a QWL intervention, employees at all levels in the organization need to answer a survey assessing attitudes towards potential initiatives. Employees are also interviewed and/or participate in focus groups. This will help identify where employee needs are, the usage of various QWL strategies, and related costs. Based on this, programs would be implemented. The use of surveys also ensures that programs are implemented where they are needed and resources are not being wasted. 13. HOW IS THE INTERVENTION CONDUCTED: QWL interventions are only effective when they are aligned with organizational goals and objectives. In other words, implementing these programs for the sake of doing so will not be effective, and will not result in any returns. Greenfield and Terry (1995) propose a “five-point” process to assist organizations align their goals with QWL initiatives.

The first step in implementing QWL programs is employee research. Employee needs assessments are the foundation of any QWL program. Greenfield and Terry (1995) found that most organizations use employee attitude surveys before implementing any form of QWL programs. Prince (2000) also finds that using an in-house survey is best. It is during this stage that employee needs are matched or aligned with organizational goals. The use of an employee survey not only allows for employee feedback but it communicates to the employees that the organization is committed to the balance of work and life. It also prevents organizations from expending valuable dollars on programs that are useless to the employee. In addition to surveys, focus groups provide for a more in-depth exchange of information. The next step is strategy development. Here, survey results would be communicated to upper management. This helps establish the link between work life issues and organizational objectives, as well as identify what types of programs will support organizations goals. During this stage, a trust relationship is established between the manager and the employee. Overman (1999) makes an interesting point. She says that QWL programs should not be viewed as way of simply accommodating employees, but as a way to redesign work process in a way that both the organization and the employee can benefit. In order for these programs to be successfully implemented, supervisors need to shift from a “resource orientation” to a “results orientation” (Mechelen, 1998). Once a strategy has been developed, it is time to design the program. The QWL program has to align with organizational goals and reflect a promissory and reciprocal relationship that exists between the organization and its employees. According to Greenfield and Terry (1995), this is the most challenging aspect in the development of QWL initiatives. This is because the QWL program had to be coordinated with existing programs, specific programs have to be selected as well as their respective vendors. In deciding which QWL program to implement an organization must first decide which fits with its needs. A two-step approach can be used to make this decision. First, an organization should do a cost-benefit analysis. Second, they should assess the organizational climate, culture, and resources. This information is used to decide which program will be best. The bottom line is that programs need to be specific to employee demographics, lifestyles and other factors related to the workforce (Mechelen, 1998). For example, Greenfield and Terry (1995) cite a survey conducted by Towers and Perrin of over 100 U.S. companies. This study found that companies offer over 100 different types of work life programs and these programs are targeted to several different demographics, e.g. single employees to working parents. QWL programs can also be aligned with an organization’s customers (Greenfield and Terry, 1995). For example, the Avon Company which employs and caters mostly to women, offers eldercare assistance, coverage for mammograms, gynecological care, diversity initiatives and child care assistance. Implementation is the fourth step. Here, the company must ensure that the work environment is appropriate for a QWL program. In other words, a completely new way of thinking must be communicated to employees. This communication should also be targeted to specific groups and not entire departments. Managers are an integral part of the implementation process. Focus groups, for example, are often conducted for the sole purpose of gaining input from them. The assumption is that for QWL programs to be effective it needs to have management support. This could explain why Mechelen (1998) calls QWL programs, management programs. Lastly, human

resource departments actually get the program off the ground. They are also responsible for channeling communications between employees and management. The assessment and implementation of such programs are an integral part of human resource strategy. The last step is an ongoing one. QWL programs must be evaluated on a consistent basis so that it remains adaptable to the ever-changing workforce. Greenfield and Terry (1995) cite several QWL program evaluation and measurement techniques. These include assessments of employee use and satisfaction with QWL programs, vendor usage, management performance systems, and policy/practice implementation. Overall, Greenfield and Terry (1995) suggest that work life programs should have a strategic focus. They should also be incorporated into management philosophy. 14. RESISTANCE TO CHANGE: Management resistance and culture is the greatest barrier to the implementation of QWL programs (Mechelen, 1998). Overman (1999) suggests that real obstacle in implementing QWL initiatives is getting managers to buy into it. For example, one consultant says that managers are reluctant to accommodate an employee because they are scared that they will have to do the same for everyone else. This is because managers use an “overseers” orientation in their approach to work. Mechelen (1998) outlines six management culture issues that may present barriers to successful implementation of QWL programs. First, if senior management does not have needs, they may not understand the needs of their employees. Second, supervisors may feel that employees will not be productive if they cannot see them working. Third, supervisors may feel that programs are brand new and untested: Fourth, supervisors may think that they will lose the ability to set boundaries. That is, by implementing one program they may feel vulnerable to fulfilling every other employee request. Fifth, Supervisors may think that the program is expensive. Finally, supervisors may react negatively to QWL programs as just another change. The good news is that most of these issues can be addressed by using employee surveys to identify specific employee needs and providing managers with data from successful initiatives. In addition to this, a pilot program will help ease managers into the idea of a QWL program before fully launching it (Mechelen, 1998). Overall, Overman (1999) says that it is important for managers to understand the needs of their employees, and invest time and money in addressing these needs. 15. MAINTAINING CHANGE: Change would be maintained through continuous follow-up, open communications and reinforcement for supporters of QWL programs. Maintaining change is the last step in the process of conducting an intervention. 16. FOLLOW-UP: Rowan (1997) suggests that for QWL programs to be successful, organizations need to assess the needs of their employees, evaluate the success of the initiative, communicate with, and educate employees on a regular basis. The Dupont company, for example, conducted qualitative and quantitative research to establish a ‘baseline’ of employees needs. Programs were aligned with company goals, and follow up research was conducted in order to evaluate the value of the programs.

17. SPECIAL CONSIDERATIONS/CRITIQUE: The effectiveness of QWL programs have been tremendous (Mechelen, 1998). Despite this, only fifty-two percent of government federal agencies use these programs (Coccia, 2000). Coccia suggests that QWL programs present different challenges for public-sector and non-corporate organizations. This is because public sector companies have different economic objectives. For example, public-sector agencies are more concerned with expanding their resources and success is not evaluated using bottom-line measures. There are several levels of authority within most public-sector agencies and goals are widely divergent. It is hard to identify whom the organization’s customer is, and this makes it hard to assess customer satisfaction. Employee turnover is minimal, so retention and recruitment are not major objectives. Finally, most publicsector agencies are comprised of older workers who may have less of a problem balancing worklife as compared to a younger workforce. Another consideration is research that suggests that QWL programs in the long-term may be inadequate. This is because workers end up spending more time on the job, and eventually burnout (Wilkinson, 2000).

REFERENCES FOR QWL PROGRAMS Baker, M., S. (1999). Family time. Puget Sound Business Journal, 20, 18-20. Calabria, D., C. (1995). When companies give, employees give back. Personnel Journal, 74, 75-83. Coccia, R. (2000). Adapting programs to varied settings. Business Insurance, 34, 12-13. Davenport, J. (1983). What ever happened to QWL? Office Administration and Automation, 44, 26-32. Feuer, D. (1989). Quality of work life: a cure for all ills? Training: The Magazine of Human Resources Development, 26, 65-67. Greenfield, C, & Terry, M. (1995). Work/life: From a set of programs to a strategic way of management. Employment Relations Today, 22, 67-82. Marcus, M., B. (2000). Workouts at work can sweeten long days, but don’t cut loose on the boss. U.S. News & World Report, 128, 57-58. Martinez, M., N. (1997). Work-life programs reap business benefits. HRMagazine, 42, 110-115. May, B. E., Lau, R. S. M., & Johnson, S., K. (1999). A longitudinal study of quality of work life and business performance. South Dakota Business Review, 58, 1-6. Mechelen, R., V. (1998). Work/life programs as management programs. The Public Manager: The New Bureaucrat, 27, 31-35. Overman, S. (1999). Make family-friendly initiatives fly. HR Focus, 76, 1-5. Prince, M. (2000). Gauging value of work/life plans complex. Business Insurance, 34, 23. Roberts, S. (1996). Employers see value in work/family benefits. Business Insurance, 30, 3-5. Rowan, H. (1997). Balancing work and life. Chemistry and Industry, 4, 144-145. Wilkinson, H. (2000). Working @ life. Management Today, 38-40.

Implementing a Team-Based Organization (prepared by Bethany Kiser) Each team within this type of organization has defined goals that coincide with the overall goals of the organization. As a result, employee perceptions of their job and the meaningfulness of their work is affected in the following ways: • Team members begin to see a direct connection between their actions and the company’s overall results; • Teams develop suggestions for improvement that are accepted by management, causing employees to recognize their contributions to the organization’s success; • Employee participation on teams creates more task and job identity, which promotes meaningfulness (Robbins & Fredendall, 1995). 2. TARGET LEVEL(S) OF ANALYSIS: It is very common for managers to go away to various training programs in hopes of returning with skills that could improve their organization’s effectiveness (Dyer, 1977). However, there is very little change that really takes place in an organization once a manager returns from one of these training sessions. When a manager returns to the work setting, the organization will still continue in the old behavior and eventually the manager will forget the training, and even why the ideas learned there used to seem like such good things for the organization. This has led managers to rethink the type of training that needs to take place to promote organizational change. Team development suggests that it is not just the manager who needs the training, but the entire organization (Dyer, 1977). Everyone needs to learn more about decisionmaking, problem solving, integrating sources, and many other topics that will enhance a team’s effectiveness. Having the entire organization involved also increases the chances of the change maintaining itself over time. A team- development program involves a complete working unit--those people who report to a common supervisor, whose work connects them to each other, and who may benefit if shared goals and participative decisions making processes were implemented. If a person’s absence would affect a team’s function, then that person should be included as a member of the team (Dyer, 1977). The entire organization is affected by team building efforts because it is hoping for some improvements due to the change in operation. As the teams gains a better understanding of themselves, they are more capable of diagnosing their own problems (Bennett, 1980). This can be of tremendous assistance to an organization, for its employees are becoming empowered to make their own decisions. The team’s organizational role is very important and can be improved and modified as goals are being met for the organization. 3. PURPOSE OF THE INTERVENTION: Before any organization begins a team-development program, a systematic assessment as to the conditions that need improvement and the appropriateness of team building as the change method is essential (Dyer, 1977). When goals are not achieved to the satisfaction of an

35 organization, or when conditions drop below set standards, a need for change is apparent. Usually, it is a manager who identifies the problems and determines a need for intervention. Symptoms that might signal the need for a team-building program include: -

loss of production or unit output increase of complaints among the employees confusion about assignments and unclear work roles general lack of interest or involvement of the employees high dependency on or negative reactions to the manager complaints from customers about the quality of service when work processes cut across functional lines when innovation and learning are priority when the organization is involved in a complex and rapidly changing market environment when the tasks that must be performed in the organization require highly interdependent employees (Forrester, 1999)

The team-based intervention is designed to overcome some, if not all, of these problems if implemented correctly and if the entire organization is committed to the change. 4. EFFECTIVENESS CRITERIA: Outcomes such as team effectiveness, measures of performance in employees, of quality, and in operations, job satisfaction, production rates, feelings of empowerment among the team members, efficiency, profit and market share, member attitudes, behavioral outcomes, and safety issues are just some of the many criteria that are used when measuring team-based organizational effectiveness (Hut & Molleman, 1998; Ingram, 1996, Cohen & Bailey, 1997). 5. EVIDENCE OF EFFECTIVENESS: a. Pinto, Pinto, & Prescott (1993) This study looked at antecedents and consequences that work teams had on the health care industry. It measured 6 hypotheses all dealing with factors that would affective team cooperation (ex- physical proximity, accessibility, goals). Team cooperation was chosen because previous research has shown that cooperation may mediate the relationship between these antecedents and team outcomes. This was also tested as one of the six hypotheses. Results found that accessibility (r = .27, p < .05), defined as how easy it is to talk to and interact with other team members, and goals (r = .60, p < .05) were significantly related to team cooperation. In addition, team cooperation was found to be significantly related to task outcome effects (r = .53, p < .05). This study shows that it is important for teams to have clear goals and be able to interact with each other easily in order to be effective as a group. If these conditions are met, meaning that teams will be cooperative, then a team-based organization will be productive. Cohen & Ledford (1994) Using effectiveness measures such job satisfaction, growth satisfaction, social satisfaction, group satisfaction, and perceptions of positive change, results from this study found that self-directed teams reported significantly higher levels on all of these measures than other work groups (M = 5.7, t = 1.72; M = 5.0, t = 4.62; M = 5.4, t = 2.86; M = 4.5, t = 1.89, respectively). In addition, employee ratings of group performance by self-directed teams were significantly higher than

36 those by other groups (M = 5.5, t = 4.20) and manager ratings of group performance were significantly higher for self-directed teams (M = 3.7, t = 2.06). These results prove that self-directed teams within an organization are more satisfied with their jobs, social life at work, growth at work, and team members than individuals belonging to other types of teams in an organization. In addition, members of self-directed teams consider themselves to be more productive and managers agree. Banker, Field, Schroeder, & Sinha (1996) This study examines the impact of work teams on manufacturing performance. After controlling for other variables that have the potential to affect performance, results indicated that quality and labor productivity improved over time after the introduction of work teams. The results found a significant negative correlation (r = .29, p < .01) between manufacturing defect rate, measured by looking at the percentage of total units produced that were defective, and post team time trend, measured by looking at the total weeks or months that the work teams had been implemented in the organization. This means that the longer the work teams were placed into the organizational structure the less defects were found in the product. b. Case #1- Development Dimensions International (DDI)- Pittsburgh, PA: This organization provides companies with training, selection, and assessment programs, many of which include printed learning materials and videos. In order to meet product demands, it decided to consolidate all printing, warehouse, distribution, and client service functions into one facility. Due to this change in layout, it implemented self-directed work teams that were created from natural work groups to enhance productivity. The teams at DDI are responsible for identifying and meeting customer requirements, planning and scheduling work, establishing improvement goals, and much more. The team leaders are the former supervisors, but they act as equal team members who assist the others. During the first year of team member training, each employee attended about 200 hours of training in team interaction skills, problem-solving skills, and monitoring performance goals, etc. In addition, about 100 hours of training on topics such as giving and receiving feedback, budgeting skills, and business knowledge were given to team members after the first year of implementation. Teams have made significant improvements since the intervention first began. There has been a 43 percent reduction in client-reported errors, improving accuracy tremendously. In addition, with only a 12 percent increase in labor costs, employees have been able to handle 86 percent more work. The inventory space at DDI required for shelf products is down 20 percent, making more space for new products in the future (Wellins, Byham, & Dixon, 1994). Case #2- Miller Brewing Company- Trenton, Ohio: Miller’s goal of becoming the most productive and flexible brewer in the industry was enhanced when the company decided to reorganize into a team-based organization. These teams were based on complete brewing, packaging, and distribution processes within the organization. The teams at Miller are responsible for conducting peer performance assessments, handling performance problems of other team members, and scheduling work assignments and vacation. In addition, team representatives meet every two weeks with representatives throughout the organization to discuss plant wide issues and making decisions to resolve problems.

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In the first year of team member training topics such as team concepts (roles and guidelines), safely principles, labor/management, group dynamics, and facilitator training were presented to the employees. Other training that occurred after that first year included: conflict resolution, and interviewing and selection. Since these teams have been implemented at Miller there has been a 30 percent reduction in labor costs in comparison to the company’s traditionally structured plants. These results are due to the flexibility associated with the team-based organization (Wellins et al., 1994). 6. HOW/WHEN WILL OUTCOMES BE ASSESSED: The outcomes that are going to be assessed need to be determined before the intervention takes place. These can be assessed throughout the entire intervention, in hopes to see results along the way. Outcomes can deal with the effectiveness of operation, employees, and quality (Ingram, 1996). Effectiveness measures of the operation can include actual sales against budget or the organization’s output in comparison with the target. Absenteeism and accident-free days are things that can be considered employee effectiveness. Quality can be measured by customer complaints or number of improvement projects (Ingram, 1996). Regardless of the type of outcome to be assessed, it is important for the organization to consider what its final goals are before starting the intervention so that specific targets can be aimed for during the intervention and beyond. 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: Introducing teams to an organization to reorganize its structure requires that all employees become involved, so the characteristics of the participants are diverse (Bass & Avolio, 1994). Team members can range from blue collar to white collar, with a wide range of education accommodating them. Everyone from supervisors to line workers is involved in the team-based organization intervention. Even those individuals who have just been hired mid-process are placed on a team and educated about the structure of the organization and its goals for the future. However, individual differences can occasionally cause problems in a team (Varney, 1989). Mixing people with extreme age differences can cause conflict at times because of these individuals’ value discrepancies. The task to be performed by the group can cause people of different skill levels and educations to be on the same team. Each team member must respect the expertise of the others. 8. TIME-FRAME OF THE INTERVENTION ITSELF: Team development should be thought of as an ongoing process, not just a one-time intervention. The program is designed to alter the way an organization functions, and to become a permanent change for everyone involved (Dyer, 1977). However, from the time that an external consultant enters an organization to assess it to the time he or she empowers the organization to change on its own with only assistance can be about 1 year. 9. TIME-FRAME OF ANTICIPATED CHANGE: As teams become more and more autonomous, changes within the organization that the team has control over can be seen right away. There will always be teams that are moving along quicker

38 than others and they will be the ones to see improvements first. These teams lead the way and encourage others to work harder to meet goals. 10. RESOURCES TO CONDUCT INTERVENTION: Most of the time, an external consultant is hired to come into the organization to assist in the change. This person offers a plan for the intervention and assists to empower supervisors and other chosen individuals to become training facilitators. There are direct and indirect costs associated with team-based interventions. Direct costs include hiring an external consultant and renting an offsite meeting place if necessary. Indirect costs can be described as the cost of the work that team members could be doing if they were not in training (Rushmer, 1997). In order to carry out training sessions, an overhead projector or flip charts may be used. A computer may also be necessary if facilitator wish to use Microsoft PowerPoint. This training can be done onsite if possible, in a conference room or any space that is conducive to learning and is comfortable for the participants. Training could take up to 200 or more hours, just to get a team off of the ground. Then subsequent training is often necessary to remind the teams of their purpose. 11. EXPERTISE OF CONSULTANTS: In order to conduct a team-based intervention in an organization some extensive training and education is required. The consultant must have knowledge of teams and how they effectively work in organizations in order to assess if this intervention is appropriate for the particular organization in question. However, once the consultant trains other facilitators within the organization, they are empowered to continue the training process. The consultant needs to act as a resource during this time, however, and remain ‘in charge’ of the intervention., guiding the organization in the right direction. 12. DO PARTICIPANTS NEED TO PREPARE? In order to begin an intervention that will effect an organization as much as this one, it is very necessary to allow employees at all levels to be involved in the planning process. This gives employees the feeling of ownership in their current jobs and positions, even if they will be rearranged during the intervention. The process of benchmarking, where supervisors go to other organizations that have already implemented teams, during the beginning stages of the process is an excellent time to involve employees. In this way, they will be more likely to accept the change if they feel they were a part of the decision to implement it. 13. HOW IS THE INTERVENTION CONDUCTED? An effective training process for such an extensive organizational change should be done in phases. The following is a typical team-based intervention (Ray, 1995), however, there are many models of this process. Phase 1 The first phase requires all of the organizational members to research the possibility of redesigning into a team-based organization. For example, representatives from the organization can meet regularly for as long as a few years to discuss these majors changes. At this stage, many companies benchmark, or visit other organizations that have already implemented teams into

39 their workplace. This is a good time for the current organization to understand the problems, as well as the successes, of this intervention (Ray, 1995). Phase 2 In the second phase of this process of change, it is necessary to implement operations training, where the employees learn all about the organization and it’s functions. This is important because as the team-based organization evolves, the employees will become empowered and take on additional responsibilities that will require their extensive knowledge of the processes of the organization. This training can be rather costly because of the development and preparation of the on-the-job and classroom materials needed to carry out the training for all employees. The development of these materials is an ongoing process, since time brings about changes in equipment and in the processes used to carrying out assignments (Ray, 1995). Phase 3 The third phase involves communicating to all employees the reasons for the desire to move to a team-based organization. This phase must take place in order to gain support from as many people as possible for this change. Without communicating to employees, the attempt at organizational change can be disastrous to the organization’s goals towards the change. Many organizations hold small meetings about the intervention and discuss reasons for the change on an individual and organization-wide level so that all employees may feel included in the process. During this stage it is very important to remember that supervisors and managers need to be positive towards the intervention (Davis, 1981). Teamwork is most likely to develop when management builds a supportive environment for it. This support helps employees to take those first steps towards the acceptance of teams in the organization. These steps become the basis of further growth toward cooperation, trust, and compatibility, so supervisors need to develop an organizational climate that supports these conditions (Ray, 1995). Phase 4 Phase four introduces the concept of changing the organizational culture to one that empowers all employees. Here, the consultant includes training for those that will facilitate the overall change, or the internal change agents, on topics such as conflict management strategies, group problem solving techniques, group development theory. A variety of small group exercises are included in this phase so that the change agents have the opportunity to discuss and practice team development issues. Once the training for the change agents is completed, the consultant continues to assist the new facilitators as an advisor and coach (Ray, 1995). Phase 5 During phase five, it is ideal for the team members to be involved with the topic selection for the team training. However, in many organizations the team facilitator and managers, or an outside consultant, decide the training topics. Topics that are often chosen are: effective interpersonal communication and relationships, conflict management, team development, problem solving techniques, and team building. Communication is one of the most important topics because effective communication among teams can provide, for example, information on performing tasks, feedback on performance, and information on the organization’s goals (Ray, 1995). Phase 6

40 The sixth phase is the final one and involves finally implementing the teams. Team roles are established so that the team can utilize all of its members and accomplish tasks efficiently. Team meetings must be a part of this phase so that the newly formed teams can continue to effectively communicate and utilize the skills learned in the earlier phases during training. These group meetings must contain an agenda so that they will be formal and productive. This agenda should be developed by the team and contain topics that are important to the team. This is a way to also empower the employees within the team. If the team is involved in shift work, it is important to try and include as many members of the team at the meetings as possible (Ray, 1995). 14. RESISTANCE TO CHANGE: Symptoms of a dysfunctional team include: apathy and general lack of interest in other team members, confusion about assignments, complaints within the group, role conflict, and low participation and involvement in group meetings (Huse, 1975). These symptoms could be part of something bigger- the overall resistance to change by the team members. If the team is not willing to put forth the effort that it takes to become effective, then those members are trying to resist the change that the organization is trying to make happen. Teams can run into problems if the members are uncomfortable removing themselves from the traditional hierarchical organizational structure. The participative decisions making can take up time and requires the employees to be willing to completely change their old way of doing things and take on more responsibility (Davis, 1981). It is also possible that teams will not see improvements right away in their work life, or the organization, and so they do not understand the need for the change. The way that the change is presented to the employees can make or break the change effort. That is why it is so important for upper management to be supportive of the entire process. This gives employees a peace of mind about what is going on around them in their organization (Davis, 1981). Giving employees greater influence over an organization’s behavior is what they would seem to want. However, increased power and autonomy is not always what some employees are looking for. In order for change to work, especially when that change involves teamwork, individuals will have to interact much more with each other on the job (Bennett, 1980). This means that employees have to rely more on each other to succeed than they did in their job previous to this change. This new empowerment that the employee possesses can come as a shock and may even leave him or her feeling helpless. Workers who have been involved with hierarchical types of organizations for long periods of time may not be able to comprehend working for one that gives them the freedom to make choices with a team (Bennett, 1980). In order to make themselves believe that the changes are real, workers may try to ‘test the change’ by offering ideas and making decisions, waiting to see if they are accepted by those they previously considered as their leaders in the organization. There is no change without stress because employees want everything to be orderly and clear. However, during this organizational change, it is hard to have everything perfect. The way to try and reduce the stresses of the employees is to set specific goals that will be met during the change process (Bennett, 1980). By forming smaller, more manageable, goals in the beginning,

41 employees’ trust can be won when these goals are met. This will prove that the intervention will be a success if the entire organization supports the changes being made throughout. 15. MAINTAINING CHANGE: The team-based organizational performance model was developed by Forrester and Rexler (1999) and is used to provide team-based organizations with the fundamental guidelines to help them continue in their team effectiveness. The model is composed of six factors that are meant to be considered simultaneously: (Note- even if an organization cannot do everything listed here, it is important to do at least some of them to insure that the team-based organization stays productive) Factor 1: Formation Establishing teams that are supported by the organization so that they can make the organization productive. This factor makes sure that the teams fit into the organization and that the organizational structures and systems will always be supportive of teamwork. Factor 2: Dependability Affects how well teams in the organization can count on each other. Teams must be well informed in order to take on the responsibilities that they need to be productive and effective. In addition, teams must believe that they can count on other teams to come through and perform their jobs, as well as the organization as a whole Factor 3: Focus The organization’s clarity of vision and its accuracy in marking progress. The vision of the organization must be communicated to the teams and the organization must also set any boundaries with which teams work. Organizations can empower teams if they have goals that can be measured. This gives them a sense of accomplishment, even on a daily basis. Factor 4: Buy-In Commitment teams and individuals have to the goals and direction of the organization. The organization must let teams know just how much freedom the teams will have in their daily processes. This will depend on the number of teams, the diversity of team functions, and the skill level of the teams. When teams have the freedom they feel they should have, and the resources they need to act, they are more likely to buy into the organizations goals and values. Factor 5: Coordination Making sure that the organization is acting in unison, since the decision making process is much more lateral now. Teams must be able to talk with one another in an organized fashion in order to remain informed about what each team is doing. Factor 6: Impact The advantage that team-based organizations gain from this type of structure. Team-based organizations can go beyond what has been done because this structure lends itself to developing new strategies and products to enhance the organization’s productiveness. Factor 7: Vitality

42 The processes that the organization implements to assure that its employees find meaning in their work. Since members of the teams are finding more meaning in their work through the new structure, this gives the organization so much more spirit and life. This should be fed upon and used to the advantage of the organization to retain this high level of energy (Forrester et al., 1999). 16. FOLLOW-UP: Formal follow-up does not have to come from the external consultant. However, he or she is usually available if the internal facilitators have questions throughout the process. The formal follow-up is something that the organization itself can implement if it chooses to do so. The Team Effectiveness Worksheet (Winum & Seamons, 2000) is an example of a way for an organization to assess a team and its functions. The worksheet is divided up into four areas: Purpose of the team, Interpersonal Processes within the team, Team Culture and Values, and Team Performance. Every 6 months after the intervention is complete the organization can assess its teams with this inventory. The results of this can determine the training and development needs of the teams in order for them to remain productive groups within the organization (Winum et al., 2000). 17. SPECIAL CONSIDERATIONS: Since this intervention is reorganizing the organizational structure into teams, instead of having employees continue to work as individuals, it is important for human resource functions to also reorganize into a more team-based structure (Robbins et al., 1995). Selection can enhance the team process by the attempt to hire employees who possess traits such as responsibility, learning ability, and cooperation. Performance appraisals must be consistent with the goals of the teams and must not focus on personal outcomes, but rather the processes that the team goes through to get to those outcomes. Recognition systems can enhance an employee’s feeling of empowerment and may be given individually. However, it is also important to give teams rewards for jobs completed as a whole to promote team cooperation and adhesiveness (Robbins et al., 1995).

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REFERENCES FOR TEAM-BASED ORGANIZATIONS Banker, R. D., Field, J. M., Schroeder, R. G., Sinha, K. K. (1996). Impact of work teams on manufacturing performance: A longitudinal field study. Academy of Management Journal, 39(4), 867-881. Bass, B. M., & Avolio, B. J. (1994). Improving organizational effectiveness through transformational leadership. Thousand Oaks, CA: SAGE Productions. Bennett, D. (1980). Successful team building through TA. New York, NY: AMACOM. Carroll, S. J., & Tosi, H. L. (1977). Organizational behavior. Chicago, IL: St. Clair Press. Cohen, S. G., & Bailey, D. E. (1997). What makes teams work: Group effectiveness research from the show floor to the executive suite. Journal of Management, 23(3), 239-281. Cohen, S. G., & Ledford, G. E. (1994). The effectiveness of self-managing teams: A field experiment. Human Relations, 47, 13-43. Davis, K. (1981). Human behavior at work: Organizational behavior. New York, NY: McGrawHill Company. DuBrin, A. J. (1978). Fundamentals of organizational behavior: an applied perspective. New York: Pergamon Press, Inc. Dyer, W. G. (1977). Team building: Issues and alternatives. Reading, MA: Addison-Wesley Publishing Company. Forrester, R. & Rexler, A. (1999). A model for team-based organizational performance. The Academy of Management Executive, 13(3), 36-50. Guzzo, R. A., & Dickson, M. W. (1996). Teams in organizations: Recent research on performance and effectiveness. Annual Review of Psychology, 47, 307-339. Huse, E. F. (1975). Organizational development and change. St. Paul, MN: West Publishing Company. Hut, J., & Molleman, E. (1998). Empowerment and team development. Team Performance Management, 4(2), 53-66. Ingram, H. (1996). Linking teamwork with performance. Team Performance Management: An International Journal, 2(4), 5-10. Pinto, M. B., Pinto, J. K., & Prescott, J. E. (1993). Antecedents and consequences of project team cross-functional cooperation. Management Science, 39(10), 1281-1297.

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Ray, R. G. (1995). A training model for implementing self-directed work teams. Organizational Development Journal, 13, 51-62. Robbins, T. L. (1995). The empowering role of self-directed work teams in the quality focused organization. Organization Development Journal, 13(1), 33-42. Rushmer, R. K. (1997). How do we measure the effectiveness of team building? Is it good enough? Team management systems- a case study. Team Performance Management, 3(4), 244260. Taylor, G. D., & Hobday, G. (1992). Work modeling techniques to bridge ‘management gaps’ in team-based organizations. Industrial Management, 34(5), 6-8. Varney, G. H. (1989). Building productive teams: An action guide and resource book. San Francisco, CA: Jossey-Bass Publishers. Wellins, R. S., William, C. B., & Dixon, G. R. (1994). Inside teams. San Francisco, CA: JosseyBass Publishers. Winum, P. C., & Seamons, T. R. (2000). Developing a team-based organization: A case study in progress. Consulting Psychology Journal: Practice and Research, 52(1), 82-89.

45 ADDITIONAL REFERENCES Aubrey, C. A., & Felkins, P. K. (1988). Teamwork: Involving people in quality and productivity improvement. Milwaukee, WI: Quality Press. Beech, N. & Crane, O. (1999). High performance teams and a climate of community. Team Performance Management, 5(3), 87-102. Beyerlein, M. M., & Johnson, D. A. (1994). Advances in interdisciplinary studies of work teams: Theories of self-managing work teams. Greenwich, CT: JAI Press, Inc. Caudron, S. (1994). Team staffing requires new HR role. Personnel Journal, 73(5), 88-94. Freedman, A. M. (2000). Multigroup representation: Representative teams and team of representatives. Consulting Psychology Journal: Practice and Research, 52, 63-81. Geber, B. (1995). The bugaboo of team pay: Compensation for work teams. Training, 32(8), 2532. Ju, Y., & Cushman, D. P. (1995). Organizational teamwork in high-speed management. Albany, NY: State University of New York Press. Harris, T. E., & Sherblom, J. C. (1999). Small group and team communication. Boston, MA: Allyn and Bacon. Hickman, G. R., & Creighton-Zollar, A. (1998). Diverse self-directed work teams: Developing strategic initiatives for 21st century organizations. Public Personnel Management, 27(1), 187199. Ketchum, L. D., & Trist, E. (1992). All teams are not created equal: How employee empowerment really works. Newsbury Park, CA: SAGE Productions. Kinlaw, D. C. (1991). Developing superior work teams: Building quality and the competitive edge. Lexington, MA: Lexington Books. Lipman-Bluman, J., & Leavitt, H. J. (1999). Hot groups: Seeding them, feeding them, and using them to ignite your organization. New York: Oxford University Press. Lucas, R. J. (1996). A new twist on teams. Internal Auditor, 53, 30-35. Mears, P., & Voehl, F. (1994). Team building: A structured learning approach. Delray Beach, FL: St. Lucie Press. McClurg, L. N. (2001). Team rewards: How far have we come? Human Resource Management, 40(1), 73-86.

46 Pacanowsky, M. (1995). Team tools for wicked problems. Organizational Dynamics, 23(3), 3652. Parker, G. M. (1994). Cross-functional teams: Working with allies, enemies, and other strangers. San Francisco, CA: Jossey-Bass Publishers. Patten, T. H. (1981). Organizational development through teambuilding. New York, NY: John Wiley & Sons. Proehl, R. A. (1997). Enhancing the effectiveness of cross-functional teams. Team Performance Management, 3(3), 137-149. Rawlings, D. (2000). Collaborative leadership teams: Oxymoron or new paradigm? Consulting Psychology Journal: Practice and Research, 52, 36-48. Steckler, N., & Fondas, N. (1995). Building team leader effectiveness: A diagnostic tool. Organizational Dynamics, 23(3), 20-36. Woodward, H., & Buchholz, S. (1987). Aftershock: Helping people through corporate change. New York, NY: John Wiley & Sons.

47 ISO 9000 Series of Standards and Beyond (Prepared by Lesley Flanik) This intervention is comprised of three quality system models: 1. ISO 9001Quality Systems: Sets out the requirements for an organization whose business processes range all the way form design and development, to production, installation, and servicing 2. ISO 9002 Quality Systems: Sets out the requirements for an organization which does not carry out design and development 3. ISO 9003 Quality Systems: Sets out the requirements for an organization whose business processes do not include design control, process control, purchasing, or servicing, and which basically uses inspection and testing to ensure that final products and services meet specified requirements It is important to note that the ISO 9000 series is in the process of being revised and when completed, will require organizations with documented ISO 9000 certification to update to conform to the additional and new standards of ISO 9001:2000. The focus is being changed from “activity” to “process.” More emphasis will be placed on continuous improvement, the role of top management, consideration of legal and regulatory requirements, attention to resource availability, determination of training effectiveness, and measuring customer satisfaction (Available: http://www.bsi.org.uk/iso-tc176-sc2/FAQs.html). It is also important to include in this introduction the mention of another common set of ISO standards: ISO 14000. Although less commonly implemented than the ISO 9000 series of standards, ISO 14000 is widely accepted in the business community as a reliable set of standards on environmental management. This intervention is appropriate for companies whose materials, processes, or products impact the environment. (Available: http://www.isonet.com/informat.htm). This report will not include an in-depth analysis of ISO 14000 standards or its implementation process because this intervention is less common than the ISO 9000 series and does not focus on an end result of quality in process and product. 2. TARGET LEVEL(S) OF ANALYSIS: ISO 9000 is generally implemented on an organization-wide basis, although the organizations do have the freedom and flexibility to define the boundaries of the implementation. The system may cover the entire organization, or specific units or activities of the organization. Some businesses have achieved company-wide certification of all their processes and activities. However, in the majority of cases, companies achieve quality system certification on a site-bysite basis, with a final result of company-wide certification. ISO officially encourages participating organizations not to misrepresent the extent of their certification. 3. PURPOSE OF THE INTERVENTION: ISO 9000 is a series of quality systems standards applicable to every business engaged in production or service. This family of standards represents an international consensus on good management practices with the aim of ensuring that the organization can time and time again deliver the product or services that meet the client’s quality requirements. Twenty standards were developed by ISO, the International Standardization Organization, to provide a framework

48 for an organization desiring a quality system that is stable, comprehensive, and consistent. The standards provide models against which the organization’s systems and processes can be audited to give the organization and its clients assurance that it is operating effectively. The standards include requirements such as management responsibility, contract review, design and date control, control of nonconforming product, and corrective and preventative action. All of these standards require consistent documentation describing how the organization addresses each of the twenty standards (Available: http://emedia49.netlibrary.com/api-bin/viewbook.dll). 4. EFFECTIVENESS CRITERIA: The most appropriate outcomes to assess include perceived quality, customer demand, amount of scrap material produced (when applicable), operational efficiency, profitability, and time to complete project (i.e. product or service). 5. EVIDENCE OF EFFECTIVENESS: The market is often the driving factor behind ISO 9000 implementation in an organization. ISO 9000 implementation can also improve overall business efficiency and demand, ensure timely, accurate, and accessible information, help develop “best practices” for the organization, and eliminate costly surprises (Available: http://www.qs9000.com/iso/iso-what-is.html). Quest Analytical, Inc., a consulting firm that offers ISO 9000 certification services, found that 85% of registered organizations report external benefits including higher perceived quality and greater customer demand (Available: http://www.questanalytical.com/ISO9000/FAQ/benefits_of ISO 9000.htm). Quest Analytical also found that 95% of certified companies report internal benefits, including greater employee awareness, increased operational efficiency, and reduced scrap expense. An Irwin Professional Publishing survey confirms the higher perceived quality and increased customer demand resulting from ISO 9000 certification (Available: http://www.questanalytical.com/ISO9000/FAQ/benefits_of_ ISO _9000.htm). A September 1991 survey of registered companies revealed that 89% reported higher operational efficiency, 48% reported increased profitability, 76% reported improvement in marketing, and 26% reported increased export sales (Available: http://www.qs9000.com/iso/iso-what-is.html). As of December 31,1999, a total of 340,000 ISO 9000 certificates have been issued worldwide in 150 companies (Available: http://www.rcglobal.com/wrcqual.htm). Laserco is a high-tech manufacturer, employing 150 people. Five years ago, a senior director wanted greater ‘discipline’ in the engineering function. Quality was chosen as a means. The quality manager wanted to introduce continuous improvement but needed a start and felt that ISO 9000 would provide the foundations. Manufacturing found implementation to be very easy. The personnel in manufacturing were all used to working in a structured way. With implementation, only a few requirements were changed employees were required to simply document the processes, most of which they were already practicing. In Engineering, implementation was a little more difficult. Prior to introducing ISO 9000 into Engineering, there was no predefined method to establish a unified design process across the various groups. The whole implementation effort took approximately two and a half years. Laserco claims reductions in time, reductions in errors, and reductions in waste. None of these outcomes were quantified by the organization (Available: http://www.iso9000.com/iso/iso9000_cases.html).

49 ISO 9000 implementation has been successful in many worldwide firms and many Fortune 500 companies. Companies with registered ISO 9000 sites include Allied Signal, Inc., AT&T, Eastman Kodak Company, Exxon Chemical Company, GE Medical and Plastic Systems, and Xerox Corporation (Available: http://www.qs9000.com/iso/iso-what-is.html). 6. HOW/WHEN OUTCOMES WILL BE ASSESSED: Outcomes are assessed after the certification product is complete, usually up to two years after its introduction into the organization. Although some organizations have reported a measurable rise in quality or demand after only a few months, the full range assessment of success should not be conducted until certification is achieved. Once the organization becomes certified, surveys on employee attitudes may be conducted, profitability examined, and product or service turnaround documented. Most of these services are offered by consulting firms that implement the ISO 9000 standards. There is cause to conduct some skeletal evaluations during the implementation process, if only to reassure upper management that the ISO 9000 are worth implementing. 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: Although ISO 9000 implementation must be an organizationally embraced procedure, from the top levels down, most participants in the actual documentation and operational process are bluecollar production workers and the lower level managers that supervise them. However, as mentioned earlier, ISO 9000 certification may involve any organization that provides a product or service. 8. TIME FRAME OF THE INTERVENTION ITSELF: An implementation project will typically take about 12 months, but ranges from 9-24 months, depending on the size and complexity of the organization (http://www.questanalytical.com/ISO9000/FAQ/How_Long_Will_it_Take.htm). 9. TIME FRAME OF ANTICIPATED CHANGE: As reported earlier, some organizations report a measurable rise in quality or demand within only a few months after the introduction of the implementation process. Almost all companies report positive internal and external outcomes after certification is complete and assessments have been conducted. Because the implementation and certification process may take up to two years, depending on the size and complexity of the company, an organization may only expect to see quantifiable positive results after this amount of time. 10. RESOURCES TO CONDUCT INTERVENTION: Becoming ISO 9000 certified requires large investments from an organization, most daunting of which are money, time, and man-hours. The organization will have to choose a registration body (a consulting firm that certifies companies) and often elects to have consultants guide the implementation process as well. The major costs an organization incurs will come from preparing the audit (the certifying inspections). For the average one hundred person manufacturing facility with minimal documentation, the cost will in most cases exceed $50,000 (Available: http://www.questanalytical.com/ISO9000/FAQ/Cost). Although it is not completely necessary to hire an external consultant for this process, nearly all certified organizations have done so in order to be recognized by their clients as an ‘officially certified’ company. The organization attempting certification also need training for key personnel and will need to create

50 and maintain a permanent internal quality audit (IQA) team to sustain the ISO 9000 standards within production. 11. EXPERTISE OF CONSULTANTS: ISO does not certify or endorse any particular consulting firm to conduct the implementation process. Therefore, consultants may claim whatever they like and organizations should be careful when selecting a registration body. Sometimes recommendations from an organization’s customers will lead the company to the appropriate consultants. Most of these consultants have done research on ISO 9000 and case studies of successful interventions. As to date, these consulting firms may only rely on client organization feedback to prove themselves worthy, making available their performance track record. 12. DO PARTICIPANTS NEED TO PREPARE: Management must know why they are implementing the ISO 9000 standards. Educating management on what the system is and is not and what it will do for the organization is the best way to start the implementation process. This information needs to trickle down to all levels of production, whether formally or informally, so that no one feels left out of the loop. The other step in planning implementation is to perform a Gap Analysis, a comparison of the organization’s current quality system to the requirements of the ISO 9000 standards. Using this report, an organization develops an implementation approach, project plan, and timeline (Available: http://questanalytical.com/ISO 9000/isoplanning.html). 13. HOW IS THE INTERVENTION CONDUCTED: To receive an ISO 9000 certificate, the organization must document, through its written quality procedures and instructions, that its quality system fulfills the formal requirements of the relevant series of ISO 9000 standards. It must then demonstrate to a certifying body that its system, in practice, functions as described. The quality assurance system consists of a set of overall quality objectives, procedures, and instructions. These quality objectives, formulated by top management, depict what the firm seeks to achieve with its quality system, taking into account what customers want, an how the organization’s general goals and resources can be matched to customer needs. The procedures describe how the firm proposes to live up to these objectives. The instructions describe how the work is done (Brecka, 1995). In many firms, the implementation of quality assurance represents the first opportunity people have had to systematically discuss their work together. The more that everyone involved contributes to the construction of the quality system, the more successful it will be. People discuss the work that they do so that everyone can argue about it. Then they agree on how things are done and they write it down. The documents are eventually assembled in the form of a quality manual. At some point, the firm chooses a certifying body, or registrar. The registrar reads through the organization’s quality manual and other documentation to ascertain whether it conforms to the requirements of the standards. If the documentation falls short. The registrar enumerates the problems in a report. For each shortcoming, the organization answers the registrar, either by convincingly justifying the system put into place, or by agreeing to make the requested changes.

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During the final certification audit (anywhere from 9-18 months after initial certification efforts), which normally takes several days, the registrar visits the firm and goes through its quality assurance system with a fine toothed comb to determine whether people, in practice, do what they say they do. If the organization ‘passes’ its examination, the certification is granted. Subsequently, the registrar returns at regular intervals to check the system; if it fails to live up to the ISO 9000 requirements, the organization either makes improvements or loses its certificate. The firm may also invite its customers to audit the quality system after its certification. In addition, internal audits are conducted by the internal quality audit (IQA) team on a predetermined regular basis. The quality system itself will continue to be modified, as customer needs change, work processes evolve, people learn to do things right the first time, and new job functions are added (Available: http://www.questanalytical.com/ISO9000/implementation.htm). 14. RESISTANCE TO CHANGE: Companies that implement ISO 9000 are told to expect confusion from staff members at first. Employees may not know how they will fit into this process, so organizations are encouraged to communicate their plans as early as possible and to provide adequate training on processes (especially documentation) and on what the new system will do for them. This information sharing will help douse the fire of fear of the unknown. Supervisors may also fear losing responsibility to the consultants or the process or having their work processes redefined, causing them to fall in status and position within the firm. If upper management shares information fully and in a timely manner, fear of the unknown on the part of supervisors should also diminish. An organization should encourage their lower level managers and supervisors to share information about the implementation as freely and as fully with their workers as upper management has with them (Available: http://emedia49.netlibrary.com/apibin/viewbook.dll) Bad management practices, such as poor communication, the failure to recognize employee talents and skills, lack of tradition for employee involvement and cooperation, lack of discipline, sloppiness in work routines, poor time and task management, lack of clear lines and responsibility, and lack of clear company policies will also contribute to the difficulties of implementing quality management in a positive way. Upper management must learn to recognize and correct the aforementioned practices in the beginning, targeting problem areas or people and conducting adequate training or interventions to reconcile the difficulty. 15. MAINTAINING CHANGE: ISO training does not appear in the structure of the maintenance phase. Training does not stop; indeed, training of all kinds is one of the basic ISO requirements. Management also has its ISO responsibilities defined in the certification phase and continuing in the sustaining phase. Success is maintained if there is a focus on leadership within the organization. After certification is achieved, the glory of victory fades in the onslaught of daily business. Effective and positive leadership can ensure that the opportunity is pursued to build on the purpose and the power of the ISO 9000 program. Marketing is an additional key to sustaining ISO certification. The organization must go beyond the ISO requirements of marketing, which focus on customer satisfaction. In the sustaining phase, the organization continues with customer satisfaction in

52 order to maintain conformance, but the firm will want should ensure customer awareness of the new capability and its advantages. The certified organization will sustain a quality position by tracking changes and trends in customer requirements (Available: http://www.questanalytical.com/ISO9000/implementation.htm). 16. FOLLOW-UP: As described earlier, in the implementation section, follow-up by the certification body and internal quality (IQA) audit team is a requirement of the ISO 9000 certification process. After certification, the registrar returns at regular intervals to check the system; if it fails to live up to the ISO 9000 requirements, the organization either makes improvements or loses its certificate. The firm may also invite its customers to audit the quality system after its certification. In addition, internal audits are conducted by the internal quality audit (IQA) team on a predetermined regular basis. 17. SPECIAL CONSIDERATIONS/CRITIQUE: A common misconception regarding ISO 9000 is that the certified organizations are certified or recognized by ISO. Indeed, they are not. In fact, a certified organization is not even allowed to use the ISO logo, which is copyrighted, to promote their achievement. ISO does not even certify or recognize the certifying bodies or auditors that implement and evaluate ISO 9000 standards within organizations. Client feedback remains the only ‘certification’ that a registrar or certifying body can receive. Another misconception appeared with the promotion of “ISO-Certified” products. In fact, no product can be certified. It is the organizational process that is certified not the product. Lastly, the question of what to do if the organization attempting certification already has a quality program(s) in place has not been addressed. In this case, the organization has two options; create separate but parallel quality systems using ISO 9000 as a model or review existing quality systems and harmonize them to the ISO 9000 standards (Jackson, 1992).

53 REFERENCES FOR ISO Brecka, Jon (1995). QS-9000 activities heating up. Quality Progress, 13, 20-21. BSI. (November 18, 1999). Frequently Asked Questions: ISO 9000. (On-line). Available: (http://www.bsi.org.uk/iso-tc176-sc2/FAQs.html). Cayman Business Systems. (March 23, 2001). ISO 9000 diatribe: The basics. (On-line). Available: (http://www.qs9000.com/iso/iso-what-is.html). Davis, Lee. (1995). Quality assurance. (On-line). Available: (http://emedia49.netlibrary.com/apibin/viewbook.dll). ISO 9000 Associates (May 4, 1999). ISO 9000: FAQs. (On-line). Available: (http://www.iso9000.com/iso/iso9000_cases.html). Jackson, S.L. (1992). What you should know about ISO 9000. Training, 48-52. Quality and Environmental Management Systems. (February 24, 2001). The ISO 9000 Network (On-line). Available: (http://www.isonet.com/informat.htm). Quest Analytical, Inc. (January 7, 2001). ISO 9000 Implementation. (On-line). Available: (http://www.questanalytical.com/ISO9000/FAQ/benefits_of ISO 9000.htm), (http://www.questanalytical.com/ISO9000/FAQ/How_Long_Will_it_Take.htm), (http://questanalytical.com/ISO 9000/isoplanning.html), (http://www.questanalytical.com/ISO9000/FAQ/Cost), and (http://www.questanalytical.com/ISO9000/implementation.htm). RC&A Associates (August 27, 2000). Quality systems ISO 9000 and QS 9000. (On-line). Available: (http://www.rcglobal.com/wrcqual.htm).

54 Process Reengineering (Prepared by Erica Taylor) 2. TARGET LEVEL(S) OF ANALYSIS: Process reengineering is the rethinking and radical redesign of business processes (Hammer & Champy, 1993). Thus, the target levels of analysis are directed towards both the group/unit/department and organization-wide changes. 3. PURPOSE OF THE INTERVENTION: The purpose of process reengineering is to lower cost, increase revenue, and improve service and the speed of making and selling products (Blair & Meadows, 1996). It attempts to make these processes more efficient by combining, eliminating or restructuring work activities. It breaks down hierarchical organizational designs and eliminates control mechanisms exhibited by both executives and supervisors (French & Bell, 1995; Rawlings, 2000). 4. EFFECTIVENESS CRITERIA: For group/unit/department changes, the most appropriate outcomes to assess include behaviors, attitudes, and sometimes even knowledge and skills of the employees. In order for process reengineering to be successful, employees must be open to changes and be willing to try new ways of doing things (Blair & Meadows, 1996). Also, depending on the types of changes that are being made, the roles of employees may require that they acquire new knowledge and/or skills. The organization can train employees on the new things they are required to do on the job, and then evaluate their performance after the training has been completed. As for organization-wide changes, the most appropriate outcomes to assess include customer satisfaction, speed of production, cost-effectiveness, and revenue. 5. EVIDENCE OF EFFECTIVENESS: a. Not enough research has been conducted at this point to draw adequate conclusions about the validity of process reengineering (Burke, 1997). Evidence up until the point of this research indicates a low success rate. This is likely due to the massive casualties of downsizing that go along with process reengineering. In addition to this association with downsizing, organizations abandoned process-reengineering projects early on when they were faced with undesirable results. Better results are expected with process reengineering if the changes are maintained over time (Burke, 1997). b. Despite the low success rates of process reengineering, many organizations are moving towards this OD intervention, and have been successful at reaching their desired outcomes. It is important to note, however, that this has not been done without laying-off a large number of employees. Organizations that have been successful with process reengineering include companies such as: IBM, Harley-Davidson, General Electric Corporation (GE), and Lockheed Martin, (Augustine, 1997; Frame, 1994; Strohmeir, 1998; Young & Murrell, 1998). 6. HOW/WHEN WILL OUTCOMES BE ASSESSED: When and how you evaluate the outcomes of process reengineering depends upon the types of changes that are being made. There are several ways in which the organization can evaluate the

55 effectiveness of the outcomes. Examples include business case evaluation (to evaluate the strategies, goals, market presence and capabilities of key competitors), feasibility studies (to review the technical, economic, and commercial aspects of a concept), technical evaluation (test technology to ensure that it meets standards), acceptance testing (to determine if customers are satisfied with the change in processes), performance appraisals (to ensure that individuals within the organization are changing their behaviors), audits (to evaluate cost effectiveness), and quality assurance, (Frame, 1994). 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: Process reengineering is a top-down process (Hammer & Champy, 1993). In order for the organization to get the drastic changes that go along with process reengineering, it is not recommended that the organization make decisions based on consensus. In addition, it is not recommended that the organization get the input of people lower in the organization because they lack the perspective that is needed to make the changes (Hammer & Champy, 1993). Although the employees lower in the organization may lack the necessary skills to advocate changes in the organization, OD consultants do recommend employee involvement. This gives the employees a sense of empowerment and enables them to deal with the changes in a positive manner (Aamodt, 1999; French & Bell Jr., 1995). Thus, OD consultants suggest that the organization has a task force that is made up of employees of different levels that has the power to make decisions along with the CEO. 8. TIME-FRAME OF THE INTERVENTION ITSELF: Depending on how drastic the changes are, process reengineering can take a long time to complete. The longer the changes take, the more likely it is that something will go wrong. Thus, it is suggested that the organization make the changes as quickly as possible. Many consultants advise that the organization take no more than two years to make the necessary changes to the work processes, (Aamodt, 1999). 9. TIME-FRAME OF ANTICIPATED CHANGE: The results for process reengineering should be observed sometime after the changes are completed. This varies according to the levels of the changes and the difficulty of the changes. One should keep in mind, however, not to expect drastic results immediately after implementing organizational changes. Many reengineering projects initially result in disappointing results, (Burke, 1997). Thus, it is important to maintain the changes even if the initial results are not what are expected. 10. RESOURCES TO CONDUCT INTERVENTION: The resources that are needed to conduct process reengineering really depend upon the types of changes that are being made. In general, it is necessary to ensure that the organization has the latest technology, money to update equipment, materials, and pay for consultants (internal or external), space to move departments and/or people, and a support staff or task force that is able to make decisions and implement the changes. 11. EXPERTISE OF CONSULTANTS: Since process-reengineering changes the way people do their jobs, it is necessary to provide them with the proper training. As for the consultants, it is not necessary for them to be an expert

56 on the product(s) the organization produces. However, it is recommended that the consultant act as a facilitator and guide the organization to make their own decisions as to what needs to be accomplished. 12. DO PARTICIPANTS NEED TO PREPARE: Before an organization engages in process reengineering, there are several things that must be considered. First, the organization should create an atmosphere for change, (Denton, 1996). Before changing the work processes, the organization should attempt to create dissatisfaction with the old system. To do this, organizations should survey the employees and ask them how satisfied they are with the current system. People are generally willing to be open and hones about the work processes and even offer suggestions on how to improve the system, (Aamodt, 1999). Once the results of the survey are shared with the employees, they are more likely to focus on the negative aspects of the current system, thus more willing to support changes. Second, the organization must anticipate resistance to change. People generally like stability in their work processes and are likely to resist even the slightest changes in their work processes. Thus, the organization should anticipate this reaction and prepare to help their employees deal with the changes. Third, the organization should anticipate the need to downsize. Process reengineering almost always results in massive downsizing. In order to help employees deal with the effects of downsizing, the organization should try to come up with alternatives to simply laying off employees. Some examples of alternatives include but are not limited to the following acts: offer early retirement for eligible employees, train and move employees to other positions within the organization, offer severance packages, and provide counseling to those who are downsized as well as those who survived downsizing. Finally, the organization should plan how they will communicate changes with the employees, (Aamodt, 1999). The more details you tell your employees about the changes, the more apt they will be to respond positively to the changes. If the organization does not share the details of the planning and implementation process, employees will feel that the organization is doing something bad and resist the changes more strongly than if the details were just shared. Although process reengineering is a top-down process and Hammer and Champy (1993) do not recommend the inclusion of lower level employees, OD consultants generally encourage the inclusion of all employees. Even if the organization does not allow all employees to have decision-making power, just allowing them to have input or express their concerns about the decisions will decrease resistance and make them feel like they have some control. 13. HOW IS THE INTERVENTION CONDUCTED: Before going over the procedure for process reengineering, it is important to note that this is only a guide. Successful process reengineering projects are different for every organization; thus, these steps should be adapted to the needs of the organization. a. Energize (Blair & Meadows, 1996) Before you begin any change, you must gain commitment from your employees and create a vision that includes the goals of the organization. It may be hard to do this since

57 process reengineering usually results in massive downsizing. If the organization reduces the fears of job cuts by looking for alternatives to downsizing (hiring freezes, early retirement plans, severance packages, etc.), it will be more successful at gaining the commitment of the remaining employees. In addition, it is important to keep the lines of communication open with the employees. The more details they know about the changes within the process, the less likely they will be to resist the changes. It is important to note that listening and responding to criticisms of the employees is just as important as informing them of changes. b. Prioritize (Blair & Meadows, 1996) Before implementing a process-reengineering project, it is important to first decide which processes will be most responsive to change. In general, it is more cost effective to use process reengineering for those jobs that are carried out most frequently as well as the jobs that are most likely to affect customer satisfaction/benefits. If the organization is considering a lengthy process-reengineering project, it is important to begin with a process that will give them a quick win before tackling the more difficult processes. This will increase the confidence and trust of the employees. c. Analyze (Blair & Meadows, 1996) Once the appropriate processes have been identified, the organization then needs to analyze the processes of the job to gain an understanding of the current system. Every aspect of the job should be questioned as to why things are carried out in the manner in which they are conducted. The organization should go through the whole process and see who is responsible for doing what and why. This analysis should find deficiencies within the processes of the organization and suggest means for improvement and change. Although analysis is essential, the organization should not get stuck in this stage. Analysis should provide the organization with a starting point for change, not necessarily tell the organization what changes are needed to be successful. d. Redesign (Blair & Meadows, 1996) Once the deficiencies within the organization have been identified, the organization should build a task force or redesign project team that includes employees from all functions that are involved with the reengineering. It may also be helpful to include suppliers and customers if feasible. It is the responsibility of the team to come up with proper solutions to the problems that were identified from the analysis of the organization. The goals of the team are to minimize the paperwork and number of people it takes to complete a job and increase the time it takes to serve customers. They should try to eliminate the layers within the organization and increase the number of multiskilled teams. e. Implementation (Blair & Meadows, 1996) Before the new processes are introduced to the employees, they should be adequately tested in lab settings and pilot sites. After the processes have passed these inspections, training programs need to be developed in order to ensure that the employees have the necessary skills to perform well. Once employees have been trained and have had time to

58 internalize the changes, they should be encouraged to offer suggestions on how to improve the new processes. 14. RESISTANCE TO CHANGE: Resistance to change is inevitable with process reengineering. In order to overcome resistance, again it is recommended that the organization create an atmosphere for change (Denton, 1996) and communicate the details of all the changes (Aamodt, 1999). Also, it is suggested that you empower your employees. By allowing them to express their opinions and offer suggestions on how to do things, you will make them feel as if they have some power and control over their work processes, (Aamodt, 1999). 15. MAINTAINING CHANGE: First, with process reengineering, the organization should not expect to get drastic improvements initially. Once the changes have had time to be internalized by the employees, the organization should see better results. Second, the organization should reward the employees who choose to cooperate and fire those employees who refuse to embrace the changes. This makes employees accountable for their own actions, (Frame, 1994). This can be accomplished by implementing a fair, systematic, and rigorous evaluation procedure. If evaluation is conducted regularly, the organization can identify problems with employees and the system early and attempt to alleviate them. 16. FOLLOW-UP: Follow up is needed to ensure that the organization has not gone back to their old ways of doing things. 17. SPECIAL CONSIDERATIONS/CRITIQUE: Remember, there is no one best way to run an organization. What works well for one organization may not work for another. OD consultants need to be able to diagnose organizations properly and treat each organization according to its own needs.

59 REFERENCES FOR PROCESS REENGINEERING Aamodt, M. G. (1999). Applied industrial/organizational psychology (third edition). Belmont, CA: Wadsworth Publishing Company. Augustine, N. R. (1997). Reshaping an industry: Lockheed Martin’s survival story. In Harvard Business Review on Change (pp. 159-187). Boston, MA: Harvard Business School Press. Blair, G. & Meadows, S. (1996). A real life guide to organizational change. England: Gower Publishing Limited. Burke, W. (1997). The new agenda for organization development. Organizational Dynamics 26(1), 7-20. Denton, D. K. (1996). 9 ways to create an atmosphere for change. HR Magazine, 41(10), 76-81. Frame, J. D. (1994). The new project management: Tools for an age of rapid change, corporate reengineering, and other business realities. San Francisco, CA: Jossey-Bass Publishers. French, W. L. & Bell Jr., C. H. (1995). Organizational development: Behavioral science interventions for OD (fifth edition). Englewood Cliffs, New Jersey: Prentice-Hall Inc. Hammer, M. & Champy, J. (1993). Reengineering the corporation: A manifesto for business revolution. New York: HarperCollins Publishers. Rawlings, D. (2000). Collaborative leadership teams oxymoron or new paradigm? Consulting Psychology Journal 52(1), 36-48. Strohmeier, B. R. (1998). The leadership principles used by Jack Welch as he re-energized, revolutionized, and reshaped general electric. Journal of Leadership Studies 5(2), 16-24. Young, J. & Murrell, K. L. (1998). Harley-Davidson motor company organizational design: The road to high performance. Organizational Development Journal 16(1), 65-74.

60 RECOMMENDED READINGS Aamodt, M. G. (1999). Applied industrial/organizational psychology (third edition). Belmont, CA: Wadsworth Publishing Company. Augustine, N. R. (1997). Reshaping an industry: Lockheed Martin’s survival story. In Harvard Business Review on Change (pp. 159-187). Boston, MA: Harvard Business School Press. Blair, G. & Meadows, S. (1996). A real life guide to organizational change. England: Gower Publishing Limited. Burke, W. (1997). The new agenda for organization development. Organizational Dynamics 26(1), 7-20. Denton, D. K. (1996). 9 ways to create an atmosphere for change. HR Magazine, 41(10), 76-81. Frame, J. D. (1994). The new project management: Tools for an age of rapid change, corporate reengineering, and other business realities. San Francisco, CA: Jossey-Bass Publishers. Strohmeier, B. R. (1998). The leadership principles used by Jack Welch as he re-energized, revolutionized, and reshaped general electric. Journal of Leadership Studies 5(2), 16-24. Young, J. & Murrell, K. L. (1998). Harley-Davidson motor company organizational design: The road to high performance. Organizational Development Journal 16(1), 65-74.

61 Organization Restructuring (prepared by Amanda Morgan) 2. TARGET LEVEL(S) OF ANALYSIS: Organization restructuring, which can include tactics such as downsizing, rightsizing, mergers, and acquisitions, is an intervention that generally is aimed at the organization as a whole. While some departments or divisions might be affected more than others, the organization as a whole will be changing with this intervention. 3. PURPOSE OF THE INTERVENTION: The primary goal of organizational restructuring is to reduce the workforce so that the organization can become more efficient (Currie, 1999). Downsizing aims to reduce costs and bureaucracy (Cummings & Worley, 2001), rightsizing aims to match staffing to that organization’s workload when workforce reductions are needed and to optimize the staff (Medvescek, 1997), mergers and acquisitions aim to combine the strengths of two similar organizations so that the resulting organization is more efficient (Cummings & Worley, 2001). In an acquisition, one company is absorbed into another, however in a true merger no one culture should win (Bouchard & Pellet, 2000). 4. EFFECTIVENESS CRITERIA: There are several appropriate outcomes to assess when looking to see if an organizational restructuring intervention has been successful. For mergers and acquisitions, one should examine: savings to see if they reach or exceed the projected goals of the intervention, implementation of shared strategies for the resulting organization, maintenance of key personnel, perceived fairness of the process, stakeholder satisfaction, timeliness, resolution of integration issues, and increased worker motivation (Cummings & Worley, 2001). For downsizing, one should examine: the increased financial performance of the organization and the levels of productivity (Cummings & Worley, 2001). For rightsizing, one outcome that can be assessed a ratio of staff to units (Medvescek, 1997). 5. EVIDENCE OF EFFECTIVENESS: a. The literature suggests that while organizational restructuring can be good for a company’s bottom-line (as in the cases of mergers and acquisitions), it often breeds stress and fear within workers (which is especially the case during a downsizing) (Davis, 1989; Lerner, 2000). Hitt, Keats, Harback, and Nixon (1994) presented rightsizing as the best alternative to downsizing, since it places a more strategic outlook on traditional downsizing by evaluating the most efficient way for each position within a company to operate. Furthermore, downsizing does not generally produce increased financial performance and/or exceed production goals (Cummings & Worley, 2001). A field-study by Freeman (1999) proposed different models of and strategies for downsizing. She found that in some cases, the organization involved would change strategies halfway through the process. The change in strategies had no impact on the effectiveness of the intervention. Furthermore, she found that organizations that included a redesign that drove the downsizing were more effective overall than those that had a downsizing driving the redesign. Effect sizes for tactics, processes, and changes were provided (ranging from d = .67, p > .05, for

62 change technology in white-collar work to d = 2.65, p < .05 in change structure in white-collar work) (Freeman, 1999). b. Rightsizing has been used to create the optimal number of graduate students in health care and psychology doctorial programs (Robiner & Crew, 2000; Pion, Kohout, & Wicherski, 2000). Hospitals seem to be largely involved, as reported in the academic literature, in rightsizing efforts (Medvescek, 1997). One example given was for an Indiana Hospital, and while the intervention was successful, one manager noted that he would not enjoy going through the experience again (Medvescek, 1997). Harshbarger (1990) cited example of mergers and acquisitions, such as the successful acquisition of Federated Department Stores by Robert Campeau. Federated Department Stores was obtained for $6.6 billion, and approximately $500 million was paid to merger and acquisition advisory and consulting firms (Harshbarger, 1990). Other large mergers and acquisitions include: Chrysler and Daimler-Benz, CBS and Viacom, Ford and Volvo, Boeing and McDonnell Douglas, and WorldCom and MCI (Cummings & Worley, 2001). Employers who have been involved in downsizing include: AT&T, IBM, Boeing, Sears, and Xerox (Cummings & Worley, 2001). 6. HOW/WHEN WILL OUTCOMES BE ASSESSED: Downsizing often occurs when one of four major conditions is present (Cummings & Worley, 2001). It is associated with and results from four primary conditions: mergers and acquisitions, decline in revenues and market share, new organizational structures, beliefs and social pressure to downsize (Cummings & Worley, 2001). When these are present, downsizing is an intervention that can be considered. The best time for rightsizing an organization is when the company’s financial performance is good (Medvescek, 1997). This can lead to continued financial success. Mergers and acquisitions should occur after careful consideration by the involved parties and aim to result in more effective and profitable companies (Harshbarger, 1990). In the end, mergers and acquisitions should focus on performance (resulting from a clear establishing of expectations about performance), focus on training needs, and hold managers accountable for people development (Harshbarger, 1990). 7. CHARACTERISTICS OF TYPICAL PARTICIPANTS: People affected by a restructuring of an organization can include anyone tied to that company. As in the case of downsizing and rightsizing, upper management and CEOs are not as susceptible to loosing their jobs as other workers within the organization. For mergers roles have to be reassigned throughout the newly formed organization, and in many cases there could be two or more people competing for what was formerly their job and has since been reduced to one position. This can affect workers at any level of the organization. In acquisitions, the workers from the company being acquired are more likely to be affected by the change than those in the acquiring company. 8. TIME-FRAME OF THE INTERVENTION ITSELF: Organizational restructuring can vary in the time it takes to change based on the tactics of the intervention being used. While the literature yielded no specific time frames, any of the forms of organizational restructuring can happen in the short-term, moderate-term, or long-term (Cummings & Worley, 2001). Mergers and acquisitions should be implemented as rapidly as

63 possible for maximum results. Here the organization should make as many changes as possible within the first 100 days after the legal combination of the previous organizations. 9. TIME-FRAME OF ANTICIPATED CHANGE: Results should be apparent immediately in cost reduction when the intervention is implemented properly. Negative results, such as attrition, increased workplace stress, and decreased satisfaction can also be apparent immediately. Just as the organizational restructuring implementation period will vary, so will the rate of change. 10. RESOURCES TO CONDUCT INTERVENTION: Consultants may be brought in to assist in organizational restructuring, especially in mergers situations where the companies involved could come into conflict (Harshbarger, 1990). Teams and/or task forces should be assigned to handle the change (Cummings & Worley, 2001). Organizational restructuring consumes considerable time, as no change of such huge magnitude can happen quickly. Organizational restructuring will often utilize support staff, such as human resources and organizational development departments to assist employees as the change occurs. 11. EXPERTISE OF CONSULTANTS: Any consultants, upper managers, or teams involved with the implementation of the intervention should be knowledgeable of organizational restructuring strategies. They should also be aware of legal and financial implications. 12. DO PARTICIPANTS NEED TO PREPARE: For mergers and acquisitions, the preparation is included in the intervention process, as detailed in the next section. Separate interventions for downsizings and rightsizings should be in place to assist those leaving the organization and those who will survive the change and maintain jobs with the organization. Upper management and select groups within the organization(s) will be involved in the planning process. 13. HOW IS THE INTERVENTION CONDUCTED: a. Downsizing: If measures are not taken to ensure that downsizing occurs in a systematic and predefined manner, the downsizing will likely loose its effectiveness for the organization (Worley & Cummings, 2001). Successful downsizing interventions “must be planned with a clear understanding of the organization’s strategy” (Cummings & Worley, 2001, pp. 150), and typically include five steps. These five steps are: (1) clarify the organization’s strategy, (2) assess downsizing options and make relevant choices, (3) implementation of the changes, (4) address the needs of survivors and those who leave, and (5) follow through with growth plans. When assessing the downsizing options, common tactics include: workforce reduction, organizational redesign, and systemic redesign. These may be used individually or in combination (Cummings & Worley, 2001). Workforce reduction is aimed at lowering the number of employees in an organization and should be used to create a transition for the organization. Organization redesign emphasizes changing the organization, not just eliminating people within it. It can create both transition and transformation in an organization. Systemic redesign aims to chance the culture of the involved organizations for a transformation into a new entity (Cummings & Worley, 2001).

64 b. Rightsizing: In undergoing a rightsizing, the timing of the intervention should be evaluated (Medvescek, 1997). As stated before, the ideal rightsizing happens when the organization is financially stable. Policies should be checked to ensure that people are eliminated, added, or relocated according to company procedures. Criteria include: seniority, performance, and/or a combination of seniority and performance. Additionally, positions should always be targeted— not people. Cross training is a viable alternative to lay-offs in rightsizing. Employees should then be notified, and the organization should have coping strategies and mechanisms in place for those leaving and those who are staying. The key to rightsizing is planning for it (Medvescek, 1997). c. Mergers and Acquisitions: There are three major phases of a merger and/or acquisition (Cummings and Worley, 2001). The first stage is the precombination phase. Here the organization is searching for a candidate to merge with or acquire and selects the appropriate candidate. A merger and acquisition team is then created and it includes people from both organizations. Next, the team must build a business case, or a statement as to why the combination of the two organizations will “result in a competitive advantage that exceeds their separate advantages” (Cummings & Worley, 2001, pp. 488). The business case needs to be justified on strategic, financial, and operational outcomes. Then, a diligence assessment needs to take place to determine what shared capabilities the two organizations have. Finally, in the precombination phase, a merger or acquisition integration plan is made to specifically state the steps that will be taken for the merger or acquisition to result. The second stage in a merger or acquisition is the legal combination phase. This is when the two organizations settle on the terms of the deal, register the transaction regulatory agencies, gain the approval of regulatory agencies, communicate with shareholders to gain their approval, and make all the necessary legal arrangements (Cummings & Worley, 2001). The final stage is the operational combination phase. This is where implementation begins to take place. Three major activities go along with this phase: day 1 activities, operational and technical integration activities, and cultural integration activities. Day 1 activities include the communications and actions that officially start the integration process. Operational and technical integration activities encompass physical moves, structural changes, work designs, and procedures put in place to accomplish strategic objectives and expected cost savings. During cultural integration activities, the merger and acquisition team works at building new values that are common for the new organization, not the parts of the pre-combination organizations. 14. RESISTANCE TO CHANGE: Few people like to find out that their company is going through a downsizing, rightsizing, merger, or acquisition. This is because the fear of loosing a job is always present. It might be for this reason that people will not try to resist the change… they do not want to give any extra reasons for their positions to be eliminated. They will be stressed by the change, and this stress will undoubtedly affect the organization as a whole. This can be overcome, or at the very least addressed by programs designed to help with the integration into a new organization, the search for employment opportunities for those who are laid-off, and the feelings of guilt that arise for those who are not laid-off (Cummings & Worley, 2001). 15. MAINTAINING CHANGE:

65 Once an organizational restructuring is in place, the organization needs to do its best to keep current employees motivated and on-task. While the organization is unlikely to return to old habits as a result of the intervention, it will need to do follow-up and evaluation on the effectiveness of the new structure and make changes as necessary. 16. FOLLOW-UP: While no follow-ups are generally needed, the organization should constantly be monitoring the results of the restructuring. Organizational restructuring should be viewed as an intervention with a beginning point and an ending point, rather than an ongoing process. 17. SPECIAL CONSIDERATIONS/CRITIQUE: Organizational restructuring is often a source of stress to workers. Besides the impending chance of loosing one’s job, communication barriers are often the cause of this (Buono & Bowditch, 1989). Due to the secrecy that often accompanies a restructuring, a “we-they” mentality can arise between workers and upper management (Buono & Bowditch, 1989). Organizations need to mindful of their workers’ mental and emotional states as an impending downsizing, rightsizing, merger, or acquisition nears. Counseling and other support services should be made available to all employees effected (Matteson & Ivancevich, 1991; Citrome, 1997).

66 REFERENCES FOR ORGANIZATION RESTRUCTURING Bouchard, P. J., & Pellet, L. (2000). Getting your shift together: Making sense of organizational culture and change. Cave Creek, AZ: CCI Press. Buono, A. F., & Bowditch, J. L. (1989). The human side of mergers and acquisitions: Managing collisions between people, cultures, and organizations. San Francisco: Jossey-Bass Inc., Publishers. Citrome, L. (1997). Layoffs, reductions-in-force, downsizing, rightsizing: The case of a state psychiatric hospital. Administration & Policy in Mental Health, 24(6), 523-533. Cummings, T., & Worley, C. (2001). Organizational development and change (7th ed.). Ohio: South-Western College Publishing. Currie, J. V. (1999). Downsizing, rightsizing, resizing, ... capsizing? Logistics Management & Distribution Report, 38(5), 40. Davis, E. (1989). Merger frenzy takes its toll: corporate survival tactics help engineers adapt to disruption. EDN, 34(5A), 69-72. Harshbarger, D. (1990). Mergers, acquisitions, and the reformatting of American business. In D. B. Fishman, C. Cherniss, et al. (Eds.). The human side of corporate competitiveness (pp. 102123). Newbury Park, CA: Sage Publications, Inc. Hitt, M. A., Keats, B. W., Harback, H. F., & Nixon, R. D. (1994). Rightsizing: building and maintaining strategic leadership and long-term competitiveness. Organizational Dynamics, 23(2), 18-32. Lerner, M. J. (2000). The human costs of organizational downsizing: The irrational effects of the justice motive on managers, dismissed workers, and survivors. In J. H. Harvey, E. D. Miller, et al. (Eds.), Loss and trauma: General and close relationship perspectives (pp. 208-224). Philadelphia: Brunner-Routledge. Matteson, M. T., & Ivancevich, J. M. (1991). Merger and acquisition stress: Fear and uncertainty at mid-career. Prevention in Human Services, 8(1), 139-158. Medvescek, P. (1997). Rightsizing the right way. Medical Laboratory Observer, 29(7), 102-7. Pion, G., Kohout, J., & Wicherski, M. (2000). “Rightsizing” the workforce through training reductions: A good idea? Professional Psychology—Research and Practice, 31(3), 266-271. Robiner, W. N. & Crew, D. P. (2000). Rightsizing the workforce of psychologist in health care: Trends from licensing boards, training programs, and managed care. Professional Psychology— Research and Practice, 31(3), 245-263.

67 Senge, P., Kleiner, A., Roberts, C., Ross, R., Roth, G., & Smith, B. (1999). The dance of change: The challenge to sustaining momentum in learning organizations. New York: Doubleday.