www.mubeena.net
High-Involvement
Organizations
www.mubeena.net
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Overview
• Key Components of High-Involvement Organizations
• History/Evolution of Management & Organizational
Change
• Components of High-Involvement Organizations;
how they’ve evolved, how they are currently
manifested
• Process of implementation
• Case studies highlighting real-world implementation
• Cultural influences on High-Involvement
Organizations
• Current trends and the future of HIOs
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Hallmarks of High-Involvement
Organizations
• Based on Edward Lawler’s model
• Challenge the structures and values of
traditional organizations
• Employees are given the right mix of power,
information, rewards and knowledge
• Encourage employee commitment to the
success of the organization
• Employee oriented approach versus control
oriented approach to management
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Evolution of the High Involvement
Approach – A Timeline
• End of 19th century – Introduction of Classical
Organizational Theory, development of Bureacracy
• 1910 – 1920 – Scientific Management; Taylor
• 1920s – 1930s – Hawthorne studies; Mayo,
Introduction of Behavioral Organizational Theory,
Human Relations Movement
• 1950s – 1960s - Human Resources Movement;
Open Systems Theory, Introduction of Contingency
Theory
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Evolution of the High Involvement
Approach – A Timeline
– Criticism of the Traditional Model begins
– Initial Experimentation
• 1970s
– National debate regarding bureaucratic organizations
• 1980s
– Concern about U.S. economic well-being
• 1990s – today
– Advocacy to broaden the scope of high-involvement
management to encompass the entire organization
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
High-Involvement Organizations:
Organizational Democracy
• Definition of workplace/organizational
democracy (Cheney)
• Participation is a necessary condition of
democracy
• Employee participation is largely a function of
power, information, rewards and knowledge
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Key Features of High-Involvement
Organizations
P.I.R.K.
• Power
• Information
• Rewards
• Knowledge
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Power
• Power to act and make decisions about the
work in all its aspects
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Information
• Information about processes, quality,
customer feedback, events and business
results
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Rewards
• Rewards tied to business results and growth in
capability and contribution
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Knowledge
• Knowledge of the work, the business, and the
total work system
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Relationship Between the Four
Elements
• POWER w/o knowledge, info. & rewards = poor decisions
• INFORMATION & KNOWLEDGE w/o power = frustration
• REWARDS w/o power, knowledge & info. = frustration &
lack of motivation
• INFO., KNOWLEDGE & POWER w/o rewards = danger
– nothing will ensure people will exercise their power in ways that will
contribute to organizational effectiveness
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
COMPONENTS
OF
HIGH-INVOLVEMENT
ORGANIZATIONS
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Implementation of HIO
No universally accepted approach
Implementation is specific to the
organization’s situation
Guided by an explicit statement of values
that members in an organization support
Guided by participative nature
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Organizational Structure
•
•
•
•
•
Flat
Lean
Mini Enterprise-oriented
Team-based
Participative structure
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Job Design
• Individually enriched
• Self-managing teams
• Psychological needs of employees
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Information System
•
•
•
•
•
Open
Inclusive
Tied to jobs
Decentralized; team-based
Participative in setting goals & standards
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Career System
•
•
•
•
•
Tracks & counseling available
Train individuals to manage careers
Encourage horizontal moves
Open job posting
Provide feedback
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Selection
•
•
•
•
Realistic job preview
Team-based interviews
Involve people from the potential work area
Promote growth
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Training
•
•
•
•
Heavy commitment
Peer training
Economic education
Interpersonal skills
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Reward System
•
•
•
•
•
•
Open
Skill-based pay
Gain sharing, profit sharing & ownership
Flexible benefits
All salaried workforce
Egalitarian perks
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Personnel Policies
• Stability of employment
• Participatively established through
representative group
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Physical Layout
•
•
•
•
Around organizational structure
Egalitarian
Safe and pleasant work environment
Transparent and open
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Power of Participation
Why should organizations initiate high
involvement strategies?
employee involvement
higher levels of
employee motivation
+
increased motivation &
commitment
higher levels of
employee commitment
= IMPROVED
ORGANIZATIONAL PERFORMANCE
(Directly impacts the BOTTOM LINE)
Involvement = Power X Information X Rewards X Knowledge
Career System
Information
System
Selection
Organizational
Structure
www.mubeena.net
Reward
System
Personnel
Policies
Physical
Layout
Training
Involvement = Power X
Information X Rewards X Knowledge
Job Design
www.mubeena.net
Case Study
Chevron
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Case Study
• Mini Enterprise-oriented company
• Four business groups:
– Chevron Corporation
– Chevron Chemical Corporation
– Chevron Information Technology Company
– Chevron Shipping Company
• 34,000 employees
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Chevron Corporation
• Parent Organization to other three
• Operations in 90 countries
• Involvment in such things as:
– Exploration and production
– Transportation
– Refining and retail marketing
– Chemical manufacturing and sales
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Chevron’s Breakdowns
• Chevron Chemical Company - 5,000 employees
– Supply of petroleum-based commodity and specialty
chemicals to businesses
• Chevron Information Technology – 1,300
employees
– Internal operating company, delivers global IT
infrastructure and differentiated custom IT solutions to
Chevron businesses
• Chevron Shipping Company – 1,900 employees
worldwide
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Dilemma
• Chevron was looking for a way to quickly
bring about large-scale change due to:
– Global competitive pressures
– Falling crude oil prices
• How can a large, multi-national company
implement large-scale change, quickly?
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Answer
Chevron needed to directly involve their
employees in the change through a process
called “Direct Participation”
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Direct Participation
• A high-involvement approach to achieving
change in a short time-frame
• Roots in the work of Fred Emery & Marvin
Weisbord’s Search/Future Search
Conferences
• The process centers itself around largescale conferences
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Direct Participation
• The overall idea is to get a representative
sample of the major stakeholders in the
organization together in one place
• The stakeholders work together to come
up with solutions to company problems,
collectively
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
How it Works – Senior
Management
• Decide on issues to be discussed & set boundaries for
what can be changed
• Communicate that the process is vital must be taken
seriously
– Personal telephone calls
– Face-to-face discussions
– Personalized invitations to conference
• Be present at the conference and participate as equals
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
How it Works – The Planning
Team
Responsible for:
• Framing Issues
– Make necessary information available
– Develop and distribute contextual materials
– Keep the process focused during the conference
– Work to channel the discussions
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
How it Works – The Planning
Team
Responsible for:
• Selecting Participants
– Ensure that all aspects of organizational diversity are
represented
• Designing Tools and Conference Activities
– Develops templates that participants use to capture
outputs in a specific, detailed and consistent format
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
How it Works - Technology
• Interactive Polling
– Give participants graphically intensive
information
– Allow facilitators to follow the progress of the
conference
– Allow facilitators to recognize when a decision
could inadvertently have an adverse impact
on a given minority
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Design Features
• Organizational Structure
– Mini Enterprise-oriented
– Team-based
– Participative council or structure *
• Information System
– Open *
– Participatively set goals and standards *
• Personnel Policies
– Participatively established through representative
group *
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Where is PIRK?
• Where do you think PIRK has been
applied to Chevron’s system?
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Outcomes
• Chevron Shipping Co.
– Purpose: identify $5 million in annual
employee-related cost savings
– Participants: 150 mariners & shore staff
– Outcome: 13 recommendations that would cut
$1.9 million in costs, another $3.4 million in
cost-saving ideas were identified
– The group found savings that management
could not have known about and avoided
adverse impact on the Asian officers
Involvement = Power X Information X Rewards X Knowledge
Outcomes
www.mubeena.net
• Chevron Chemical
– Purpose: Performance Systems Redesign
– Participants: 180 employees, customers &
suppliers
– Outcome: Specific recommendations for
enhancing job selection, career development,
performance management and recognition
systems
– let to 20% increase in employee commitment &
50% improvement in satisfaction
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Outcomes
• Chevron Corp.
– Purpose: Develop a system to promote
diversity & to measure diversity achievements
– Participants: 200 employees
– Outcome: 15 strategies; key metrics including
numerical targets for women & minorities for
leadership roles, diversity plans that are part
of all leaders’ performance evaluations, &
improvement in employee survey
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Outcomes
• Chevron Information Technology
– Purpose: New strategy to ensure the
continued delivery of value-added services
– Participants: 100 employees, as well as
customers
– Results: 6 action items; mentoring program
and strategy communication
– Participants signed up to participate in
ongoing groups after the conference
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
World Class Quality
Talent of workforce
Quality
(Rao et al.,1999)
Workforce empowerment
World Quality
Human Resource
Development
Employee Participation, Commitment, Empowerment
& Involvement
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Model Base
(Bennett, 1999)
Influences on Work Attitudes
Cultural Values and
Beliefs (east)
Situational Practices and
Characteristics (west)
Work Attitudes
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Culture Model
(Hofstede, 1980)
Culturally influenced dispositional characteristics of a nation serve as
guides to organizational behavior
Uncertainty Avoidance
Individualism/Collectivism
Masculinity/Femininity
Power Distance
Individualistic: Reward and Power (USA, Britain)
Collectivistic: Knowledge and Commitment (China, India)
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Individualism Scores
(Hofstede, 1997)
100
90
80
70
60
50
40
30
20
10
0
Japan
India
Britain
USA
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Power Distance Scores
(Hofstede, 1997)
80
70
60
50
40
30
20
10
0
Japan
India
Britain
USA
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The External Environment of Newly
Industrialized Countries
• Move from centrally planned to market driven
economy
• Open to global competition
• Large internal markets
• Growing middle class with high purchasing
power
• Increase in volume exports to the west
CHINA
INDIA
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
!Contradiction!
Collectivistic: Lack of high involvement
[INDIA, CHINA -- close-knit teams, participation]
Individualistic: Prevalence of high involvement
[USA, BRITAIN -- independent, lack of participation]
Individualists working
collectively
Working independently despite her
collectivistic society
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Idea
Collectivism = High Power Distance = Low involvement
Individualism = Low Power Distance = High involvement
Collectivism = Deep-rooted Culture Influence reflected as High
Power Distance = Low involvement
Individualism = Current Situation Influence reflected as Low
Power Distance= High involvement
Collectivists are on their way to achieving high quality without high
employee involvement and participation through their current
trends in organizational operations...
The current trend within developing nations is focused on
leadership and increased national reward systems
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
The Expert System Trend
• An Expert System is a computer software
package that provides the computer with the
art of decision making similar to human
beings.
• The Quality Circle Expert System was
needed to combat the failure of quality
circles, lack of employee participation in
management decisions, and to maintain the
power distance within collectivist cultures.
• Emerging trend in Indian manufacturing firms.
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Functioning of Expert Systems
1. Present Status Module
Knowledge of benefits and
shortcomings of the
present global status of
various quality circle
programs initiated
2. Action Plan Module
User interacts by enquiring
about feasibility of
undertaking essential
activities in the firm
3. Planning for
Implementation Module
QCES elicits information
from user and gives
detailed report on
probable success
4. Diagnosis Module
Diagnoses causes of failure
of quality circle programs
in the firm after partial of
full implementation
Involvement = Power X Information X Rewards X Knowledge
www.mubeena.net
Current and Future Trends
• Organizations have been slow to implement
employee involvement principles
– Internal resistance
– Uncertainty about to implement
– Lack of systems support
• Little empirical data to support the assertion of
the efficacy of high-involvement organizational to
produce greater qualitative and quantitative
outcomes
• Further research necessary
Involvement = Power X Information X Rewards X Knowledge