Kathy McCarthy was the manager of a production department in Alvis Corporation, a firm that manufactures office equipment. The workers are not unionized. After reading an article that stressed the benefits of participative management, Kathy believed that these benefits could be realized in her department if the workers were allowed to participate in making some decisions that affect them. Kathy selected two decisions for an experiment in participative management.
The first decision involved vacation schedules. Each summer the workers are given two weeks’ vacation, but no more than two workers can go on vacation at the same time. In prior years, Kathy made this decision herself. She would first ask the workers to indicate their preferred dates, then she considered how the work would be affected if different people were out at the same time. It was important to plan a vacation schedule that would ensure adequate staffing for all of the essential operations performed by the department. When more than two workers wanted the same time period, and they had similar skills, she usually gave preference to the workers with the highest productivity.
The second decision involved production standards. Sales had been increasing steadily over the past few years, and the company recently installed some new equipment to increase productivity. The new equipment would make it possible to produce more with the same number of workers. The company had a pay incentive system in which workers received a piece rate for each unit produced above a standard amount. Separate standards existed for each type of product, based on an industrial engineering study conducted a few years earlier. Top management wanted to readjust the production standards to reflect that fact that the new equipment made it possible for the workers to earn more without working any harder. The savings from higher productivity were needed to help pay for the new equipment.
Kathy called a meeting of her 15 workers an hour before the end of the work day and explained that she wanted them to discuss the two issues and make recommendations. Kathy figured that the workers might be inhibited about participating in the discussion if she were present, so she left them alone to discuss the issues. Besides, Kathy had an appointment to meet with the quality control manager. Quality problems had increased after the new equipment was installed, and the industrial engineers were studying the problem in an attempt to determine why quality had gotten worse rather than better. When Kathy returned to her department just at quitting time, she was surprised to learn that the workers recommended keeping the standards the same. She had assumed
they knew the pay incentives were no longer fair and would set a higher standard. The worker speaking for the group explained that their base pay had not kept up with inflation and the higher incentive pay restored their real income to its prior level.
On the vacation issue, the group was deadlocked. Several of the workers wanted to take their vacations during the same two week period and could not agree on who should go. Some workers argued that they should have priority because they had more seniority, while others argued that priority should be based on productivity, as in the past. Because it was quitting time, the group concluded that Kathy would have to resolve the dispute herself. After all, wasn’t that what she was being paid for?
Answer all the questions (3 x 10=30marks)
1\. Were the two decisions appropriate for a group decision procedure?
2\. What mistakes were made in using participation, and what could have been done to avoid the difficulties the manager encountered?
3\. Were these two decisions appropriate ones for introducing participation into the department?
Marsha Brown was the new manager of a suburban office of Metro Bank. The branch office was experiencing low morale and lower productivity than expected. One of the difficulties was that the office served as an informal training center for young managers. New hires who needed experience as loan officers or assistant branch managers were assigned here for training. When they reached a certain level of competence, they were promoted out of the branch office. This practice was demoralizing to the less mobile tellers and other assistants, who felt exploited and saw no personal reward in “training their boss.” After some checking with her boss and other people at corporate headquarters, Marsha concluded that it would be impossible to change this program. Her branch was one of those considered to be essential for executive development in Metro Bank. During her first few months on the job, Marsha got to know her employees quite well. She reviewed performance records and met with each employee in the branch to talk about the person’s career aspirations. She learned that many of her employees were quite capable and could do much more than they were presently doing. However, they had never seen themselves as “going anywhere” in the organization.
Marsha searched for a unique vision for the branch office that would integrate the needs of her employees with the objectives of the executive development program, and in the process better serve the bank’s customers. She formulated the following strategic objective: “To be the branch that best develops managerial talent while still offering quality customer service.” From this decision flowed a series of actions. First, Marsha declared that development opportunities for growth would be open to all, and she initiated a career development program for her employees. For those who wanted career advancement, she negotiated with the central training department for spaces in some of its programs. She persuaded the personnel department to inform her regularly about job openings that might interest her employees, including those not involved in the executive development program. Next, she built rewards into the appraisal system for employees who helped others learn, so that even those who did not aspire to advance would get some benefit from contributing to the new objective. To provide adequate backup in service functions, she instituted cross-training. Not only did this training provide a reserve of assistance when one function was experiencing peak workloads, it also contributed to a better understanding of the policies and procedures in other functions. Marsha also used developmental assignments with her own subordinate managers. She frequently had the assistant managers run staff meetings, represent the branch office at corporate meetings, or carry out some of her other managerial responsibilities.
The changes made by Marsha resulted in major gains. By repeatedly stressing the strategic objectives in her words and actions, she gave the branch office a distinctive character. Employees felt increased pride and morale improved. Some of the old-timers acquired new aspirations and, after developing their skills, advanced into higher positions in the bank. Even those who remained at the branch office felt good about the advancement of others, because now they saw their role as crucial for individual and organizational success rather than as a thankless task. The new spirit carried over to the treatment of customers, and together with the increased competence provided by cross training, it resulted in faster and better service to customers.
Answer all the questions (3 x 10=30marks)
1\. What leadership behaviours did Marsha use to change the branch office and motivate employees?
2\. Describe Marsha’s vision for her branch office of the bank.
3\. Do you think Marsha should be classified as charismatic, transformational, or both