Sunday, February 14, 2010


The kinds of Human Resources systems and practices that organizations develop differ to some extent. They evolve in response to different circumstances, but it is becoming clear that HR management does affect an organization’s effectiveness and ability to compete. Three examples are given here to show how the relationships among individuals, jobs, and effective HR management can affect an organization. Plastics Lumber Company: In Akron, Ohio, Alan Robbins started a small factory that converts old milk and soda bottles to fake lumber used in picnic tables, fences, etc. His major problems have been with his employees. He intentionally put his factory in a downtown location and hired local residents. When he began, he was lax and friendly—he would break out cold beers for everyone at the end of a shift, or grant employees personal loans. A turning point came when Mr. Robbins had to fire two workers for fighting on the work floor.
One was roaming the factory looking for the other with an iron bar in his hand. Both men filed for unemployment compensation, and filed racial discrimination complaints. Mr. Robbins realized his laissez-faire approach to HR was not going to work. Other tough issues involving alcohol and drugs at work also emerged. In one month, he had to fire four of his 50 employees for cocaine and other substance abuse problems. Absenteeism is a constant problem. So is the threat of lawsuits and injury claims, as well as discrimination and unemployment claims. In response Mr. Robbins has built elaborate HR defenses against such problems and says he no longer trusts his employees as much as he once did. His solution is an HR system built around a thick employment manual outlining what will be tolerated and what will not.
Northwest Airlines: Northwest’s customer service and labor problems have gone from bad to the worst among major airlines. Northwest had the highest number of customer complaints, the most delayed flights, and second worst performance on mishandled bags. The airline recognized the problems, but the situation worsened as General Motors and Chrysler announced they were shifting some of their business travel to a Northwest rival. The automakers were unhappy with high fares, delays, and cancellations by Northwest. The FAA is investigating an unusually high number of mechanical problems, and union employees had a strike. In looking at Northwest Airlines, the CEO of Continental Airlines observed, “They know they have some service issues.”
He further noted, “A successful company can’t be at war with its own employees.” Chrysler Corporation’s Windsor Van Plant: When 33-year-old James Bonini was named manager of the big van plant in Windsor, Ontario, virtually everyone was surprised. He was young and inexperienced for the big job in one of the least-automated plants— with hundreds of manual jobs. He was selected because his boss wanted to shake up Chrysler’s manufacturing plants, where managers thought they were drill sergeants, workers were dissatisfied, and quality problems were abundant.
Mr. Bonini made mistakes and was met with skepticism. But his commonsense management approach finally succeeded in changing the culture of the plant and attitudes of many employees. En route to that outcome, he took actions that had not been used before—and that paid off. He met with all the workers in small groups; interestingly, many workers had never even met a plant manager. Bonini and his staff redesigned about 70% of the assembly operations and redesigned jobs to improve ergonomics, cost, and quality. His concern for his people showed up in incidents as minor as dealing with worker complaints
about restrooms to changing telephone policy after a worker did not get a call in time to get to his dying wife’s bedside. Bonini and his managers used worker teams to help draft standard operating procedures, and those teams made meaningful changes in the way workers did their jobs each day.
The plant’s approach to individuals and their jobs was changed—a feat acknowledged positively by even the most hard-bitten skeptics. Workers and managers both had changed the way they viewed and did their jobs.
Individuals are both valuable and perverse commodities for the managers who rely on them to accomplish work. In some organizations the people and the innovative ideas they generate are really the “product” that the firm produces. In others, depending on the job design, people may be a necessary but much smaller part of the overall effort, because machines do most of the work. What is the actual monetary value of an individual to an organization? Employers who compete on the basis of their employees’ capabilities know the importance of people to the success of the organization. However, the exact monetary value of a skilled workforce may be difficult to identify. An organization may have created a workforce that works harder or smarter than competitors; or one that generates many new ideas and is continually learning new ways and finding better methods. There may be no formula to put a precise dollar amount on such favorable values and activities, but when a company is sold, such attributes of the workforce bring a premium price.
Just as the quality of the workforce can be a competitive advantage, it can also be a liability. When very few employees know how to do their jobs, when people are constantly leaving the organization, and when those workers who remain refuse to change or work more effectively, the human resources are a competitive problem that puts the organization at a disadvantage. Simply having an effective strategy and good products or services does not guarantee success for an organization if the individual employees do not implement that strategy or produce organizational products or services efficiently.

No comments:

Post a Comment