Do we really need HR? -Hot topic of the week!

Bernard Marr,Best-Selling Author and Enterprise Performance Expert has just written an article expressing that we no longer require HR departments: 

http://www.linkedin.com/today/post/article/20131118060732-64875646-why-we-no-longer-need-hr-departments?trk=tod-home-art-list-large_0

A follow-up article has been written in response to Marr's by Josh Bersin,Principal and Founder, Bersin by Deloitte who argues for the vitality of HR in business as we know it today.

http://www.linkedin.com/today/post/article/20131118164721-131079-why-we-do-need-hr-departments

I'm with Bersin. What's your opinion?

And so the On-going debates in HR continue....

Recent debates in HR:
-Most current debates generally focus on the extent and nature of the responses needed in the face of development in the business environment. Three of the most prominent current debates focus on:

i. the nature of the psychological contract
-due to the evolving environmental pressures there is a significant and fundamental change the “psychological contract”. This refers to expectations that employees have about the role that they play and about what the employee is prepared to give them in return. By its nature, the psychological contract is not a written document. Rather it exists within people’s heads.
-while people disagree about the extent to which this change has in fact occurred, there is general agreement about the phenomenon itself and the notion that an “old” psychological contract to which generations of employees have become accustomed is superseded to some extent by a “new” psychological contract which reflects the needs of the present business environment.

Old Psychological Contract (From an employee perspective)
“I will work hard and act with loyalty towards my employer. In return I expect to be retained as an employee provided I do not act against the interests of the organisation. I also expect to be given opportunities for development and promotion should circumstances make this possible.”

New Psychological Contract:
“ I will bring to my work effort and creativity. In return I expect a salary that is appropriate to my contribution and market worth. While our relationship may be short term, I will remain for as long as I receive the developmental opportunities I need to build my career.” – Involves a sense of less job security and less loyalty from employers in return. Instead the employees will be flexible and will be given developmental opportunities in return,

 

-the key question is, how far has a change of this nature actually occurred? Are we really witnessing a slow decline in the old contract and its replacement by the new one? Or have reports of its death been exaggerated? This is a highly disagreed issue. Evidence of reduced employee loyalty have been found by Coyle et Al (2000) however Guest et Al (2000) have found little change in the state of the psychological contract.

ii. Best Fit HR strategy Vs. Best Practice?

Best-practice theory : The 'best-practice' theory is based on the assumption that HR practices observed in high-performing firms can be transformed to other companies with the same results. Pfeffer's list of seven HR practices for competitive advantage through people is one of the best known set of best-practices.
1. Employment security
2. Selective hiring
3. Self-managed teams or team working
4. High pay contingent on company performance
5. Extensive training
6. Reduction of status differences
7. Sharing information

In essence, recruiting and retaining talented, team-oriented, highly motivated people is seen to lay a basis for superior business performance or competitive advantage. But this theory, like several other universal models, has been criticised for a variety of reasons:
• Disconnection from company's goals and context
• Disregard of national differences such as management practices and culture
• Inconsistency between the RBV's emphasis on in-imitability and best-practice universalism
Although best-practices are too general, some researchers have found empirical evidence showing a correlation between the application of best-practice theories and company's performance. The reason can be seen in the validity of the underpinning "AMO" (ability, motivation, opportunity) framework.

Best-fit theory : The contingency or "best-fit" approach questions the universality assumption of the best-practice perspective. Instead it emphasises the fit between HR activities and the organisation's stage of development ("external-fit"). According to the "best-fit" theory, a firm that follows a cost-leadership strategy designs narrow jobs and provides little job-security, whereas a company pursuing a differentiation strategy emphasises training and development. This approach is a counterpart to the "one strategy fits all" seen in Pfeffer's seven best practices. The 'best-fit' school, therefore, argues that all SHRM activities must be consistent with each other (horizontal fit) and linked to the strategic needs of the business (vertical fit).

However, 'best-fit' approach has been criticised for the following reasons:
• Lack of alignment with employee interests, compliance with prevailing social norms and legal requirements
• Too simplistic view of business strategy (the reality is more complex than only innovation, cost-reduction and quality-enhancement strategy in the Schuler and Jackson model)
• Too much focus on existing competitive strategy (reactive) rather than on-going environmental changes (proactive)

iii. Predictions about the future of work:

-this is a highly speculative debate, but predictions about the future of work are very important now from a public policy perspective. Why? --> Judgements about employers’ HR needs in the future must determine decisions about education and training now. Government actions in the fields of economic policy, employment legislation and immigration are also affected.
- Authors such as Handy and Greenfield argue that the world of work (i.e. the type of work we do and the nature of contractual arrangements will change profoundly as we complete our journey out of the industrial era into a new post-industrial age.

Consequences will be:

1. A marked shift into knowledge work. In the future, most people will be employed to carry out tasks which involve the generation, interpretation processing or application of knowledge. We will see further declines in manufacturing activity. More specialists will be employed (demand for professional and technical people will increase, which demand for lower skilled, manual workers will fall). This means that from an employer’s perspective, sustaining competitive advantage will mean more effective capacity to create and deploy knowledge than others.

2. Jobs will become more rare, where fewer people will occupy defined jobs in organisations. More people will work on a self-employed basis, carrying out time-limited projects for organisations. Due to the volatile nature of business, firms will not be able to guarantee long term work and long term employment contracts will reduce. (lower job security).

Note these consequences are rational as they are based on the face of recent business trends and globalisation. They are quite persuasive, yet highly controversial.

 

Rewards and Remuneration: four part blog series is now up!

Are you interested in the rewards and remuneration arena? 

Have a look at my blog series on the HR Coffee Pot guest blog! 

• Introduction: How much should we pay?

• How should we pay? Option 1: Base pay

• How should we pay? Option 2: Pay related to Performance

• Conclusion: the final word on pay

image sourced from:  afgeunionblog.wordpress.com 

London School of Economics Human Resources Conference 2013

Calling out to all practitioners, academics and student interested in the HR arena: the LSE is hosting the People, Purpose, Power conference on the 20th May 2013.

Full details to be found here:

http://www2.lse.ac.uk/management/news-and-events/events/LSE%20HR%20Conference/130520-LSE-HR-Conference.aspx

Great opportunity to learn about contemporary issues, recent areas of HR research and meet some of the leading guest speakers in the HR field!  

Why don't more women make it to the top?

I came across an interesting read by Schumpeter on the "Mommy Track" in relation to Work Life Balance policies- barriers to adoption and effectiveness of "Flexitime".

 Are women really superheros who can manage the demands of work and family responsibilities without negative spill-over effects on either domain?

[image sourced from kforce.com]

Case study: Family-Friendly, Equal-Opportunity, and High-Involvement Management in Britain

This post is based on the key question: Is there a business case for work-life balance?

 According to a study conducted in 2008 by Wood and De Menzes, results have shown that there is a weak link between economic workplace performance and implementation of WLB policies in the workplace, however it does lead to lower levels of absenteeism. Read on for the key takeaways and results extracted from the study:

Family-friendly, equal-opportunity, and high-involvement initiatives have increasingly been at the forefront of discussions of human resource management since the 1990s. They are widely viewed by academics and policy makers as critical ways of simultaneously improving the well-being of workers and the efficiency of organizations. Moreover, they are often presented as related practices.

   How are they related?

 On the one hand, the work enrichment that is central to Lawler's (1986, 1991) and Walton's (1985) high-involvement management is expected to enhance workers' satisfaction and well-being at work and reduce the spillover of negative emotions from work to family life.

 On the basis that ‘personal time is a legitimate employee need,’ that the equality and diversity agendas imply that any effective high-involvement management must be extended from employee involvement to embrace issues of working time (Bailyn 1993)

Why do employers care?

It is important to restore work enrichment to a central place in human resource management if we are to capture the core of the high-involvement concept and also to pursue family friendly management and equal opportunities. The pursuit of family-friendly management and the achievement of equal opportunities can in turn help to create the conditions in which people can work in a more highly involved way. Crucially, this may signify to employees that management views the workforce as a major asset and is concerned about its well being, as well as allow them to work unimpeded by family pressures.

Family-friendly management involves employers having an underlying commitment to help employees obtain a balance between work and family obligations. Two types of family-friendly practices may be identified: (1) those that create flexibility in the timing and location of work so the employee can more readily accommodate family demands, and (2) those that provide a substitute carer for the employee (Bailyn 1993: 67; Bond et al. 1998). 

     Equal-opportunity management is oriented towards eliminating any differentiation of opportunities, resources, and rewards based on the membership of a sociological group, for example based on gender, ethnicity, or age. It is thus concerned to ensure that jobs, wages, promotions, and employment benefits in the organization are fairly distributed.

     High involvement management is oriented towards work enrichment and flexible working methods and ensuring that employees have the skills and motivation to use their discretion and decision-making powers for the benefit of the organization.

These three approaches to aspects of management are expressed in management practices, and if they exist we ought to see a pattern in the use of a range of practices associated with them. For example, if family-friendly management is an identifiable managerial approach in the UK, we would expect practices concerned with childbirth to coexist with those related to child rearing. If this is more than simply a parentoriented family-friendly policy, these in turn will be accompanied by practices associated with eldercare and other such problems. Similarly, if an integrated orientation towards family-friendly, equal-opportunity, and high-involvement management exists, we would expect that practices, for example related to childbirth, will coexist with work enrichment or equal-opportunity practices.

ü  Both family-oriented flexible management and equal-opportunity management are significantly more

likely to be found in the public sector. In contrast, high-involvement management is less likely in the public sector.

ü  Within the private sector itself, high-involvement management is significantly more prevalent in financial services and significantly less likely to be used extensively in manufacturing, construction, hotels and restaurants, transport and communication, other business services, and other community services.

ü  In addition, organizations with human resource departments are more likely to have family-oriented flexible management and equal-opportunity management, but are less likely to have high-involvement management.

ü  The size of the workplace, as measured by the number of employees, is positively related only to equal-opportunity management. But the size of the larger organization, of which the workplace is a part, is related to both family-oriented flexible management and high-involvement management.

 

ü  In the case of family-oriented flexible management, organizations with over 5,000 employees are significantly more likely to adopt it, while in the case of high-involvement management, organizations with 100 or more employees are more likely to practice it than organizations with less than 100 employees.

ü  The proportion of the workforce that consists of managers is positively associated with both equal-opportunity and high-involvement management, while the proportion of the workforce that consists of women is positively linked to family-friendly management, and weakly related to high involvement management.

In Britain there is no evidence yet of an integrated high-commitment management. Nonetheless, there appear to be discrete orientations underlying the use of family-oriented flexible, equal opportunity, and core (work and skill acquisition) high-involvement practices.

Results provide little support for the ‘business case’ in favour of family-friendly and equal-opportunity initiatives, which is the argument for employee-centred methods on the grounds that they are supportive of key organizational objectives. But, equally, neither set of practices has a negative effect on performance. It has nonetheless been found that high-involvement management is positively associated with financial performance, labour productivity, and labour retention. In addition, where high-involvement management is adopted, equal-opportunity management will have a positive effect on financial performance. Equal-opportunity management is associated with lower absence levels, and again this is strengthened when high-involvement management is adopted. When family oriented flexible management is underpinned by top management valuing employees having a balance between work and family responsibilities, it is also associated with lower absenteeism. The limited number of associations between organizational performance and family-friendly and equal-opportunity managements may be used to reinforce the arguments for a holistic approach. It could be precisely because the employee involvement, equality, and diversity issues are not integrated that the current approaches are not as successful. Moreover, the lack of recognition that the potential benefits of such an integrated approach may be high may very well explain the relatively low take up of such practices.

[image sourced from: detoxednews.com]

Managing working life: 8 hours of work, 8 hours of leisure and 8 hours of rest?

For all those of you interested in the work-life balance arena, keep an eye out for my new blog post on the topic over the next few days.

 In the mean time, have a look at these websites for some background information  :
http://www.unison.org.uk/worklifebalance/casefor.asp
http://www.employersforwork-lifebalance.org.uk/
http://www.workingfamilies.org.uk/
http://www.guardian.co.uk/money/work-life-balance

 For those of you employers and HR practitioners who want to see the "lighter side" of things , check out this entertaining blog post on work life balance: http://www.personneltoday.com/blogs/human-resources-guru/2007/07/removing-the-life-from-worklif.html#.UR5yLfJeu6Q

Image source: science-professor.blogspot.com

Keeping an eye on Bonus and Rewards for 2013

Recent trends: The close watch on bonus payouts this year continues, particularly in the banking arena.

Importance of a reward and remuneration committee on the board of a large company? Imperative!

Read more here! 

image source: www.colourbox.com

Presentation and Interview preparation: Top Tips for job seekers!

Many a time we are faced with the task of having to do a presentation and/or engage in a face to face interview(s) at an assessment centre. These are crucial elements in the selection process  in  order to find someone ideal for the job. For those of you who are unfamiliar with Assessment centres,take a look at my post for an overview.

PRESENTATIONS:
Remember, in giving an effective presentation, assessors are unlikely to be assessing ALL possible skills such as capacity for leadership/collaboration. Skills which will be examined include your communication,analytical abilities and sense of judgement.

 This stage of the recruitment process is important as employers wish to analyse how much credibility and confidence you will have in front of a client/senior manager/ any other important stakeholder of the company.

-In preparation period always ask yourself:

• who is your audience?
• what skills are they looking for?
• what is your main point?
• how long do you have? 

-Structure of the presentation:  follow 3 simple steps:
1.Say what you are going to say
2. Say it
3.Say what you have said

-During your preparation period, if you are provided with visual aids (e.g. a flip chart) please use it!
-Always maintain eye contact, positive body language, and enthusiasm.
-Interact with your audience: build a rapport, interesting/topical fact/ humour them(if appropriate)
-Keep an eye on the time! break down the presentation into segments and allocate minutes accordingly.
-If you have to do a pre-prepared presentation, never memorise what you are going to say word for word!
-To capture attention of the audience,add variety to voice tone and make use of rhetorical questions
-Sudden "mind block"/you freeze unsure of what to say next - conceal this with a "Dramatic pause" !
-Strong body language when you are at the end of the presentation, i.e. "and the key take-away from this analysis is...Now that I have reached the end of my presentation I would be more than happy to answer any questions you may have."

For all those introverts out there who fear public speaking, check out this great article and video featuring a
TED talk by a speaker called Susan Cain. It is worth looking at from the perspective of female presentation style - no hands in pocket, but plenty of eye contact, smiling, use of pause. It's also worth looking at if you have an introverted style - the content of her talk focuses on this issue (and is very encouraging!)

INTERVIEWS:
What do employers look for?

Fit

MotivationCommitment

Can you do the job?

Proof of skills/ competencies

How you present yourself

Commercial awareness

Interviews may take any one or more of the following types:
Panel, Telephone/ Skype/Competency/Motivation/ Strengths/Technical/Situational judgement/Case study/Brain teasers

Question types (Depending on the interview type):

• Competency: Can you tell me about a time…
• Motivation: Why do you want to work for us?
• Strengths: What energises you more, starting or finishing a task?
• Technical: How does X impact the three financial statements?
• Situational judgement: What would you do if

Common mistakes that you do not want to make: 

-Not answering the question-avoid waffling

-Talking too much/too little

-Talking too quickly-pace yourself!

-Negativity in your responses

-Lack of eye contact with the interviewer

-making personal statements about political/religious beliefs or anything seemingly controversial that the interviewer may not agree with.

-at the end of the interview when asked "Do you have any questions?"- Never say no, remember that this is a two way opportunity: show your motivation, intelligence and commercial awareness in the questions you ask.

TOP TIPS!

Face to face interviews: Body language, eye contact, smile

Panel interview: Greet everyone and thank them all, by name if possible!

1:1 interview: Shake their hand, engage with the employer,thank them

Telephone interview: Quiet location, Speak clearly, stay structured in your response,DONT read pre-prepared answers,use prompt notes,thank the interviewer for their time

Shake off those nerves:

• Think positively “I will get the job”
• Appear confident Hand shake, smile
• Relaxation techniques :Get a good nights sleep, take a walk, choose a morning slot
• Lose the pressure There are other jobs!

Last of all, remember that preparation is the key to success! make sure you:

-Check the interview details

-Read through your application

-Familiarise yourself with the job description

-Create a list of possible questions

-Practice answering the questions

-Research of the company and the sector

-Decide what to wear and plan your route in advance

Best of luck!

image source: www.studentbranding.com

Job prospects looking bleak? 6 things you can do,starting today!

Yes yes, I know the situation is not looking as chirpy as we want it to. Many fear a triple dip in the UK economy, as GDP is expected to shrink in 2013. nonetheless let's not give up, it's worth a try. 

Check out this interesting article by David N. Schwartz from www.efinancialcareers:

"Six Things to Do if you’re Unemployed and Trying to Get a Job in the New Year"

image sourced from agbeat.com

HRM in the public sector: [PART 2]

1. TRADITIONAL PUBLIC SECTOR HRM

Whether more influenced by the notion of being "sovereign employer" or its role as a "model employer", traditional HRM systems share a number of features:

- There are centralised and standardised practices

- Strong job security, compared to the private sector

- There are numerous procedural guarantees that employees can recur to

- Seniority and length of service is an important criterion for many decisions, such as promotions, pay and redundancies

- There are nationally comparable standards that apply to across the whole public sector

- Professional norms are integrated within HRM systems, in the sense that the

professions define their own criteria for HRM decisions such as hiring, pay, performance evaluation, training, etc.

Looking at particular HRM areas:

-->In selection, traditional HRM systems are geared towards ensuring equal access to government employment. Hiring is merit driven, often through open competitions in which tests are carried centrally, rather than by each unit or department. Also, hiring is done into the service, rather than into a particular position.

-->In careers, there is the expectation of lifelong employment. Careers are based on a standard classification system. Staffing decisions (who is assigned to each position) and promotions are determined centrally, often through a system of seniority where employees are ranked according to a point system. Points are awarded for length of service, formal training and education and for performing particular functions.

-->In terms of pay and rewards, there are centralised systems of pay determination, based on standard rates for each level or grade, plus service-related increments.

-->Performance management (what is good or bad practice and behaviour) relies on professional norms, and may even be carried out by the professional bodies themselves.

-->Finally, discipline procedures for misconduct, absence, etc. is handled by centralised

departments, rather than line managers.

2. NEW PUBLIC MANAGEMENT

-In the 1980s, a different way of arranging public services developed, as a response to a certain context. There was higher demand for high-quality public services by a more educated and affluent electorate. At the same time, this electorate was increasingly tax conscious. Finally, there was a small-government ideology in the Thatcher and Reagan administrations, by politicians who regarded public employees more as knaves than
knights.

NPM had a number of general elements. Among the most important are
-Opening public services to competition, and making them adopt a user-focus.
-Introduction of numerous explicit performance metrics, particularly efficiency (benefitto-cost) measures
-Decentralisation of decision making, giving managers discretion over the running of their departments.

-NPM has been adopted to different degrees in different countries.New Zealand is often quoted as the country where NPM reforms have been taken furthest. Sweden and the UK too. On the other side of the spectrum, countries like France, Germany and Spain have adopted few elements of NPM.

Under NPM, HRM in the public sector introduced many elements of private-sector HRM. The most important are:
-Line managers are given a larger roll and discretion for hiring, promotions and rewards,
-Hiring is position based, lifetime careers are rolled-back
-Individual performance appraisals are introduced
-And these are linked to pay

Evaluations of NPM are mixed.
-There has been considerable resistance to NPM by workers, particularly in those aspects where a user- or managerial- focus has clashed with professional norms (e.g. should assessments of the quality of education include the opinion of pupils; should assessments of the quality of healthcare mostly focus on clinical statistics or patient perceptions)

-There has been limited use of HR discretion: units that have had HR responsibility devolved to them have not done anything different from others. This has been attributed to lack of managerial expertise, but also to possible difficulties with unions and in accounting for decisions.

-Performance related pay has in many cases been awarded on top of salary increases, limiting the financial savings. There have also been widespread difficulties in setting meaningful goals, so the motivational effect has been limited. On the brighter side, PRP has been credited with stimulating change and an upwards renegotiation of effort norms (Marsden, 2007)

-Finally, reforms in HRM seems to have been successful in reducing head counts in the public sector, but this has been done at the expense of work intensification and loss of skills, which have had an impact in the quality of worker lives and of service provided.

3.HRM and the economic crisis: living in the "age of austerity"

It started  off with Northern Rock being the first bank run in the UK in more than 150 years.A year later, Lehman Brothers was let to collapse by the US government.This sparked a series of banking bailouts in the UK, the Netherlands, Ireland, and other
countries.

In 2009 and 2010, the crisis moves to sovereign debt, affecting particularly countries in the Euro area. The US and the UK remain under pressure (fiscal cliff, etc.)This has brought enormous fiscal pressures onto governments.

Governments need to cut spending. More than a third of UK government spending goes out in direct payments of benefits and grants. Another third is spent in procurement of goods and services, and just under a quarter is spent in paying public employees. The first area that governments have targeted is public employment. The benefits bill is politically difficult to cut, particularly in times of high unemployment, and with the issues of an aging population. Procurement spending is also difficult to cut because much of it relates to citizen services that have been outsourced, cutting those services is also politically difficult. Result? Cutting the public pay bill is being done through reductions in employee numbers, and through cuts to remaining employee terms.

How will the public sector react?: Lodge and Hood (2012) have suggested that governments may react to the situation in four ways:

1. they may become more directing, intervening in areas where it did not use to.
2.they may move further into contracting services out to the private sector
3.they may become more reliant on community organisations
4.they may give up altogether on providing some public services

Although they suggest central governments are more likely to become directing or hollow, whereas local governments are more likely to become communitarian or coping,they envisage each government moving in different directions for different areas.

The implication for HRM is that workforce requirements for each of those state roles is very different, thus it can be argued that HRM in the public sector will become more diverse within individual countries, and even within individual governments.

HRM in the public sector: An introduction [PART 1]

• Lets start by defining what the ‘public sector’ is, and what it might be composed of.

Broadly speaking, the public sector refers to those organisations whose ‘owner’ is the state, including the organisation of the state itself. It is thus different from the private sector, whether for- or not-for-profit.

The definition becomes clearer when we look at the different parts of the public sector.

1.organisations that carry out government administration, whether central, regional, local or supranational. This is what is usually referred to as the civil service


2.Armed forces and the police. This is a special group in that they are subject to a special kind of discipline due to their role.


3.public employees who provide services to citizens, such as education and health. e.g. doctors, nurses, teachers, etc. In some countries, however, part or all of these services are purchased by the state from the private sector, and this is the reason for much of the variance in the size of the public sector across countries.

4.Semi-independent agencies and non-departmental public bodies, also called ‘quangos’. In the UK their number is contested and placed at between 700 and 1500 by different sources. These bodies typically perform regulatory and advisory roles which are deemed to be performed best independently from government.e.g. Ofcom, the Civil Aviation Authority.

5.Finally, there are trading companies which are owned by the state. In the UK these include the BBC, Royal Mail and London Underground.

• Bear in mind that in the UK, the public sector accounts for approx 20 percent of the workforce( a total of almost 6 million workers). The two largest groups are employed in education(1.6 m) and the NHS(1.56 m), who together account for more than half of all public sector employees.
  

• So, what is the history behind these numbers?

-The British civil service was created through a series of acts of parliament in the middle of the 19th century, which curbed the previous system of patronage by which public offices were granted to political allies and personal connections. By 1870 most of the regulations of an independent, merit-based civil service were in place.

-After WWII, the creation of the ‘welfare state’ saw a huge increase in the number of public employees through the expansion of public services, the creation of numerous benefit programmes (which needed to be administered) and the nationalisation of many industries which had previously been part of the private sector, e.g. British Coal (1946), British Rail (1948), British Gas (1948-1972), British Steel (1967).

-Starting in the 1980s, under the Thatcher and later governments, there was widespread reform of the way the public sector was managed, targeted at an active management of the performance of public services, and a retrenchment of the ‘trading’ public sector through numerous privatisation programmes. These reforms have come to be known as the New Public Management (NPM), a label that is still applied today to refer to ongoing reforms in the public sector.

-Finally, we have witnessed in the past few years huge challenges to the public sector in what has been labelled as an ‘age of austerity’. The exact consequences for the running of the public sector remain to be seen, but are likely to be profound.

• What is all this information in relation to HRM in the public sector?

See PART 2  for a detailed analysis of the three models of HRM in the public sector:

1. Traditional public sector HRM as practiced in most Western countries between WWII and the 1980s, and is still prevalent in many countries.

2. Reformed HRM as adopted after the 1980s in New Public Management countries

3. Current trends in public sector HRM as a consequence of the current economic crisis.("the age of austerity").

Image sourced from : danhawes.blogspot.com

Employee Voice and representation in the workplace

• Employee voice refers to practices designed to allow workers with some "say" in how their organisations are run..
• Alternative terms to voice can be: employee participation, employee involvement or industrial democracy.
• It is useful to see employee voice within the context of the struggle for control of the content and pace of work, which forms the basis of Labour Process Theory. This struggle arises from the interest of management in maximising workers’ effort and productivity, while workers strive for meaningful work and moderate effort.

• What is the goal of employee voice?

For management:
- a means to improve organisational performance
-gives management social legitimacy
-management may be compelled by law to give employees a say in certain types of decisions
-management may be motivated by their own ethical, ideological or religious convictions.

For employees:
-a means of greater job satisfaction through more meaningful job content, more autonomy and discretion.
-an opportunity for higher reward and recognition: formal and informal
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what are the forms of employee voice?

-DIRECT: exercised by individual employees

Categorised under three main headings:
-Task Based Participation

refers to the amount of say workers have in how their own work is organised, it is an everyday part of the job. In a sense, direct supervision is replaced by enhanced worker discretion as to what actions to perform and when.Formally, most direct voice schemes refer to team working arrangements, which receive different names depending on whether they are supervised or not.Because of enhanced autonomy and more meaningful jobs, employee satisfaction, motivation and performance is expected to increase.However, there has been criticism that teamworking schemes lead to an intensification of work through peer pressure and enlargement of job responsibilities (job creep).

-Upward Problem Solving

Upward problem-solving refers to schemes in which employees provide input to solve wider problems in the processes of the company, beyond their own job tasks. The two most common programmes are suggestion schemes and problem solving groups, often called quality circles.

The benefits of this type of voice come from the actual improvements that are achieved, and also from a commitment effect from the additional involvement from workers.Some common problems with this type of scheme is how to reward participation. Sometimes, very significant financial gains can be made for the company, should these be shared with employees?Would this make participation something instrumental for workers? If not, would it be fair?Another pitfall is that there is often high initial interest, but then, once the easiest fixes are addressed, interest declines. Finally, these systems have been criticised because efficiency suggestions may actually make employees redundant.

-Grievance Systems

Grievance systems refer to formal channels to complain for unfair treatment. They tend to be highly formal systems, often regulated in law or union contracts. Among the benefits they bring is that they act as a control mechanism on supervisors, allowing higher management to address issues of bad practice. Second, managing conflicts, rather than ignoring them and allowing them to grow bigger, may help avoid the problems caused by ‘silent voice’.Finally, good grievance procedures increases the perception of organisational justice, which has been shown to be related to employee commitment. These systems however have been criticised in that management are often unwilling to act, and can even retaliate against employees who use them.

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-INDIRECT: exercised through elected representatives e.g. trade unions, workers councils,etc

(slight shift away from the topic, here's some other related stuff on trade unions, just FYI)

So What is a trade union?

They are democratic organisations set up to represent workers’ interests.However, workers’ interests are not a given: each individual has different interests. The collective interests that a union represents are socially constructed, and this is much of what keeps union officials busy. If they are able to successfully construct a collective interest, the main way in which they defend it is through a process called collective bargaining, in which they secure certain employment terms for their members, and sometimes for non-members within the bargaining unit. Apart from this essential function, many trade unions provide members with a wide range of services, and they lobby government in favour of certain policies. In Western economies, unions have been in decline since their heyday in the 1980s, particularly in liberal economies where legislation has been more hostile.

Trade unions have two sources of power:

-Coercive power which derives from the threat of industrial action, such as strikes

-Legitimacy power which derives from their recognition as valid interlocutors on behalf

of workers.

Unions are most likely to be strong among skilled workers, because union members are more difficult to replace, where a strong group identity and a collectivist ideology makes it easier to construct a collective interest, and in those sectors where labour costs are not a large part of overall costs (so employers can afford to make concessions) and where competition is only moderate, so there is less likelihood that companies that make concessions will be driven out of business through higher labour costs.


However since the 1980s we have observed a decline in trade union power. Reasons for this elude to:
- Privatisation of nationalised industries under the regime of Thatcher

- Economic Changes:
i. The spread of globalisation meant that higher labour costs implied that firms could go out of business easily. 
ii. The decline of the UK manufacturing sector. Remaining manufacturing firms became smaller in size and more geographically spread in dispered locations.
iii. The enhancement of the service sector (less requirement for trade union representation)

-Augmentation of technology: enhanced communication as information could be shared more easily. Furthermore, the development of capital reduced to some extent the labour intensity of certain sectors (i.e.. capital replacing labour).

-Trade unions pre-1980s favoured full time working males significantly more than other parties. A more diverse workforce in recent years consisted of  more female participation and ethnic minority groups in the workforce. Key question: did trade unions really have an interest in representing such groups? 

-Shift in mindset/ ideology: less Marxist and Socialist ideologies valued at the time. 
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-SILENT: 

A controversial category of voice which is useful to point out that absence of direct and indirect employee voice has been found to foster resitance behaviours in employees, which can be quite damaging to the organisation. these include absenteeism, shirking, or antisocial behaviour.

• We must also categorise "voice regimes" by looking at the depth and scope of employee participation.

-depth refers to how much actual influence workers can have on how work is arranged ranging from none(only one-way information) to decisive influence.
-scope refers to the substantive importance of the issues on which employees have a voice.

Stay informed HR gurus! - Economic Outlook for 2013

As the new year rolls in, let us review the financial challenges faced in 2012 and the outlook for the months ahead....Indeed the key economic issues faced over the past year will linger into 2013, yet the pace of progress has been picking up ( cheer up, it's not all that bad!)

• Number one on the agenda would be major Eurozone concerns, a factor which is key to determining the financial market performance in 2013. As a result of considerable uncertainty, companies remain reluctant to engage in spending, investing and hiring. Officials have gotten together to calm the crisis, nonetheless one can only hope that more concrete initiatives will be put in place to shed some light on the degree of uncertainty currently being experienced.
  
• Next we must consider the US: Will it be able to overcome the current fiscal cliff? Taking on an optimistic outlook, we can expect growth rates of approximately 2% for 2013.
  
• Growth from developed countries is expected to be less this year than historically seen and interest rates are expected to remain low. As for emerging markets, China, the world's most promising superpower (at the moment) is expected to show growth rates of approximately 7-8%. It is also worthwhile to mention that Africa is becoming an increasingly exciting part of the world, as companies have recognised more and more rising opportunities there.
  
• Next let's focus on the UK economy: Indeed it has slipped into a difficult recession for the second time, and is yet to emerge with real conviction from the negative impacts of the recession. Austerity measures have helped to maintain market confidence and the ability to hold on to credit ratings.However the price to pay for this is slower rates of economic growth, higher than expected inflation, sluggish consumer spending and unemployment. Beyond this, the UK's major trading partner (Eurozone) remains in dire straits, thus affecting UK's export sector.The challenge is to now look towards other export markets perhaps? the UK is expecting 1-1.3% growth for 2013.
  
• Considering companies around the world: they have indeed gone through major transition and restructuring, leading up to the perception of being  "leaner and meaner". In the developed world, prospects look promising and profitability is expected to grow by 11% for 2013, permitting investors to benefit and reap benefits of healthy dividends in return for their contributions. As for the little guys who must not be forgotten,SMEs are expected to benefit form  looser credit conditions this year. This is a result of higher funding for lending to SME's by the BOE, thus permitting these companies to stay afloat and flourish in the year ahead.
  
• Banks: the time has now come to seize opportunity of the banking crisis -the good news is that this is the perfect time for banks to reinvent themselves as financially viable and socially responsible institutions. The turmoil of 2012 has created opportunities or the smart players as the withdrawal of competitors has created openings for the remaining survivors. Technology continues to redefine trading, the labour market is identifying genuine talent, shareholders are becoming more realistic about rewards and risks, and regulators are modifying the rules. Despite these chaotic circumstances,we realise that it is this very chaos which equates to opportunity. These circumstances are ideal for restructuring an industry in need of regaining its role as a key player in the economy.  it is advisable  that banks now look at designing product first and shareholder value second. this opens up the likelihood of generating an ethical, sustainable and added value business. The key challenge remains for investment banking leaders to use this opportunity and re-emerge itself as the cutting edge of the financial services industry.  

The truth behind Downsizing and Recessions: are all the effects negative?

Indeed the prospects for retaining one's job has been difficult in the recent past due to the bleak economic situation among other contingent factors,whether it be manufacturing sector firms such as Tata steel or financial giants like UBS.  This article aims to analyse reasons behind why firms downsize, its effect, and key factors to take into consideration when it comes to laying off workers. 

Why do firms downsize? 

·         Everyone in the market does so
·         financial reasons          Cut costs, especially overheads
·         Increase adaptability
·         Speed up decision-making
·         Focus on companies’ key competencies
·         Increase productivity
·         Outsourcing
·         Improve shareholders’ equity

     Why do firms engage in downsizing NOW?

·         Competition intensified on the global scale
·         Product life cycles decreased, thus need fast responses
·         Diverse customers’ needs require a more agile response
·         Escalating employee benefit cost
·         Automatizing happened
·         Bottom line performance essential,due to takeover threat and the need to cut costs
·         Some managers believe that downsizing is a good strategy to become profitable
·         Growth of contracting services triggered outsourcing
·         Employees require more flexibility and the traditional long term attachment of an individual to an employer is no longer popular

The effects of downsizing

    Effects on the firm’s bottom line -The research evidence is mixed.

According to Wyatt, 1/3 of companies saw increase in profits after the layoffs as much as expected, less than ½ said that cuts reduced expenses as much as expected. Bases on AMA research, those firms who cut jobs first reported an increase in profits and decrease after a short period of time. However, no causal relationship between downsizing and profit was proved. In general studies suggest that financial effects of downsizing in the SR and LR are negative.

One possible reason for not finding causal relationships is that layoffs are not accompanied by significant permanent changes. Layoffs are simply there for a short period of time, with positions being filled again after some time.

Another set of studies state that the way layoffs are implemented will determine the effect on firm’s financial performance. Long term improvement can be observed if cuts are combined with asset restructuring, strategic changes, or changes in organisational structures. The effect is particular vivid when prior to introduction of the cuts had deteriorated performance in comparison to competitors in the market. In other words, downsizing has a positive effect on long term performance only if it is part of the fundamental change in an organization’s strategy, structure, culture and/or work arrangements. 

It is unclear that downsizing boots productivity. According to National Bureau of Economic Research found that plants that increased employment as well as productivity contributed almost as much to overall productivity growth in the 1980s as the plants that increased productivity as the pants that increased productivity at the expense of employment. Productivity depends on differences between companies, not cut offs. According to AMA, achieving quality and productivity improvements in conjunction with downsizing depended significantly on the amount of training activity in which firms engaged following the job elimination.

    Employee Morale and Attitudes

      Cuts have negative effect on employee morale and attitudes. They cause distrust, demotivation, loss of valued employees, stress and overwork by the stayers. All of those have immediate and long term affects. In addition to increased turnover, voluntary departures and increased disability claims. The reason for the above is that those employees who stayed feel that they will be next to be fired, this demoralises them, makes them stressed, cause chronic fatigue and as a result can get sick.

    Downsizing in work environments that emphasize creativity

      Cuts are very distractive for such firms. Cuts cause job insecurity. Insecurity causes lack of creativity and risk-taking. Also, downsizing diminishes the stability of workforce and their speed and effectiveness in communicating. Although these effects can disappear with time, immediate effects are still painful. Loss of employees also destroys the existing relationships within group as well as some external connections fired employees had.

Who leaves: Downsizing and Workforce Quality

Sometimes some of the most able employers leave. The reason for this can be that firms tend to first rely on voluntary quits and thus offer generous terms for the leavers. In turn, those who choose to leave are those who believe they can get a good job elsewhere which will tend to be the better employees.

However, employers can choose who leaves. Nonetheless, the survivors will still feel the threat of being fired and may quietly searching for new job. Of course, the better the employee is, the more likely that those efforts will bear fruits in the form of an outside job offer and hence non-volunteer downsizing program may result in some voluntary quits, which will tend to be concentrated among the more able.

What is more, employees can affect their own termination decision. If good terms are offered for leaving, they might fear that in the future this will not be the case.Thus they will attempt to leave immediately by for example, refusing restructuring reassignment, which protects him/her from termination. Adverse selection can happen, because the best employees will tend to choose to leave.

    Downsizing and society

Job loss has profound negative effect for the displaced employees and their families. This adds to the social cost of downsizing.

Research showed that unemployment and job loss also leads to criminality, drug/alcohol abuse, domestic violence, separation and divorce, decline in health, depression, suicide, children’s’ well being.

However, there are potentially positive effects on community, such as: layoffs promote superior matching of workers to jobs and increased dynamism and risk taking in the economy, thereby fuelling economic growth. Also new jobs are created and compensate for the downsizing and outsourcing.

The moral of the story....

      Downsizing is likely to work better when it is part of a well conceived general strategy of restructuring the firm and its workforce.This happens because downsizing programmes that go beyond the layoffs and pursue underlying organisational problems or try to exploit real opportunities are more likely to address the real problems or successfully exploit the real opportunities.Also the survivors of the downsizing campaign are not likely to reduce their morale and loyalty if downsizing serve a purpose.  Employers, it is useful to explain employees why cuts are happening!

Must you downsize?

      Family-like cultures will suffer more because of downsizing than other types of firms. Firms that depend on good relationships with the surrounding community and that loom larger on the local labour market will also find downsizing more costly. Firms in a tight labour market will face a stronger adverse selection problem in terms of who departs and thus on the community and on the psychological state of the survivors.

     

     Technology and work organisations: when the tasks are interdependent, downsizing tends to be more disruptive, both economically and socially. With respect to business strategy, organisations that seek competitive advantage from continuous improvement or by transferring knowledge gained in one product, service, or division to another part of the firm will tend to suffer most from the knowledge losses wrought by downsizing.

     Organizations, with seniority-based protections may stand to gain less economically from downsizing, because the layoffs will disproportionately hit workers with lower seniority, who are presumably are making less money. Also organisation needs to consider its benefit plans employees have.

      Need to consider alternatives, such as wage cuts, hours adjustment, job transfers, reassignment of work across plants, etc…

     factors to consider about firm’s ability to downsize:

a)Inventory policy (if firm is able to store inventory workers can produce for inventory)

b)    The extent of uniformity in its operations across work sites (if uniformed, can relocate workers for needed work)

c) The extent to which it has cross trained workers

d)    Extent of vertical integration (if high, can relocate workers where there is demand for them)

How to downsize if you must: process considerations:

     The following can reduce the adverse effects of downsizing:

1)  Explain workers the reason for downsizing

2)  There should be extensive communication before, during and after cuts.

3)  It should be clear to employees that you have given due consideration to alternatives to downsizing.

4)  The process should be perceived as embodying distributing and procedural justice.

5) The process should be kind to the leavers. However, don’t over do, can cause uncontrolled voluntary departures.

6)  There should be support services for the “survivors”. Such as – good sense of where the firm is headed after the layoffs are done, intensive retraining, resocialisation, etc…

     Massacre or drip-drip-drip?

Dramatic or gradual?

Local labour markets may be better able to absorb the discharged workers if they are discharged gradually. This can reduce the adverse effects on the local community.

However, those who have suffered through the downsizing tend to believe that a “get it over with in one fell swoop” is better.

According to AMA, dislocative effects associated with layoffs abate considerably after the first year following the downsizing. And beneficial effects from lay offs appear only after some time after they occurred. Thus, by moving boldly and rapidly, companies may minimize the long-term psychological damage and also perhaps achieve a more pronounced and rapid increase in shareholder equity.

     Across the board or targeted lay offs?

Targeted lay offs lead to internal political activity aimed at redirecting the ax at some other target. Such political activities are particularly destructive, when a firm’s culture and technology emphasize cooperation and collegiality. Thus, targeted is too painful, especially for managers who are supposed to solve the occurred issues among employees.

Regarding the across the board layoffs, the issue of distributive injustice may occur. Units that are performing exceptionally or that have disciplined efforts keep their headcount down and thus should be reduced less. Thus, across the board downsizing will also score low on procedural justice because of the arbitrariness and inflexibility of the targets.

What is more in companies where departments are interdependent everyone will feel intense loss of friends and colleagues. Also cutting on all the departments will push employees to think that management doesn’t have a clear plan on what should be done.

     Layoffs, seniority and age
Age (more experience vs more years of potential service)
If company decided to cut on the older workers, it should consider early retirement programmes to avoid the adverse selection and appearance of age discrimination.If loyalty is important – don’t lay off older workers. Moreover, lawsuits can occur is the case of a particular discrimination occurs (i.e. age, sex, etc). Layoff should be based on more than just age!

Dealing with the community (reputation concerns)

      Firm needs to think how to help local community as well as its ex-employees. I.e. subsidize re-training, etc. However, the amount of effort depends on the interest of your organisation to be a “good citizen” of the affected locales.

Conclusion:

     Use cost and benefit analysis and weight your decisions properly

     Lay offs have profound effect on the firm, managers, employees and local community.

     There is shortage of the solid research confirming the positive impact of downsizing on profits nd productivity.  Also it is not fully understandable how to downsize properly.

     Need to think about how, why and who

     Managers should make a rational informed decision and communicate it to employees.

     If downsizing is followed by outsourcing, companies need to make sure that the process is effective and makes sense (i.e. doesn’t lead to hiring the laid off workers as consultants).