The NOGO Railroad Case Study
Overview
A close look at the case reveals a shoddy and archaic organizational culture at NOGO Railroad rife with negative practices such as nepotism and feather bedding being actively practiced as part of the legacy of the rail industry, shaping up the currently rigid and change-averse attitude of the employees. This is substantiated by the findings of a research study conducted in Malaysia “showing an association between organizational culture and the affective, cognitive, and behavioral tendency of attitudes towards organizational change, and that these acceptance levels of change vary with different types of organizational cultures, some of which facilitate change, whereas others restrict it” (Rashid, Sambasivan, & Rahman, 2004). The situation at NOGO Railroad is no different with the staff members developing apathy towards the organization and the manner in which the operations are going on, with no desire to “run that extra mile” to change the situation or at least trying exploring it from a different angle.
The key players involved include the company’s newly appointed communications manager - Dave Keller, his immediate boss, the operational manager - Allen Yates, his (Dave’s) predecessor, Nick Chacco, along with the rail manager - Rex Kelly. The foremost responsibility to create a positive workplace culture lies with the senior management who lays its foundation, values it and communicates its efficacy to the future incoming breed of new employees who have an established system in place to follow. Hence, in this case also, the laid back attitude of the senior management is responsible for the company’s current state of affairs.
Causes
Though, not having an employee-friendly work culture is a sure-shot cause of the problems being faced by NOGO Railroad, but a major deficiency in the company is lack of strong and well-established HR Department or HR Manager that could have put a brake on the unfavorable practices mentioned above by laying down proper policies and processes. Too much interference of the trade unions in the company’s daily functioning to the extent of defining ironclad job descriptions and employment contracts for both telegraph operators and clerks, unchangeable to even absorb untoward work demands, along with the former being guaranteed 40 hours of weekly pay in comparison to the clerical staff, regardless of the availability of work, also depicts the chaos such employee associations can cause in the absence of an HR authority. To make matters worse, Allen Yates decision to promote a chief dispatcher like Dave Keller to the communications manager’s position, solely on the basis of his superior performance in his current role, seems devoid of sagacity, especially when the skill sets and competency levels for both the roles are quite different, and performance in one area, no matter how exemplary it is, cannot be generalized in other areas. This kind of a decision can only be taken on the basis of systematically and professionally carried out performance evaluation and succession planning procedures, which in an outdated company like NOGO Railroad are unimaginable. Moreover, after having spent almost a decade with the organization, and knowing it in and out, Dave himself admitted not feeling confident enough to pull off the new role with competence, thus, questioning the credibility of this decision.
These problems are not difficult to anticipate, but what is required is some level of perceptiveness and broad-mindedness to understand them, and take proactive measures to “nip them right in the bud”. However, they need to come from the top management only, which itself is lacking any signs of progressiveness or intention to change things for good, and instead seems to watch everything like a mute spectator either out of ignorance or approval. The main reason behind such laxity is the monopoly surrounding the uniqueness of NOGO’s operations to transport minerals, making the company and the top management sees no reason to anticipate any future market changes that would lead to the current state of affairs, thereby, necessitating any preventive measures on its part. This is the biggest flaw in their thinking
Solutions
Firstly, Dave needs to take up additional responsibilities as an HR manager to clean up the system, with full support of the top management, thereby, setting an example for everyone else in the organization.
Secondly, he must try hard to mitigate the influence of the trade unions on the organization’s functioning, by limiting their involvement and interaction with the company’s employees as much as possible
Finally, the entire employee recruitment and selection system in NOGO Railroad needs a complete an overhaul to completely get rid of evil practices like nepotism and featherbedding.
Recommendations
Firstly, it is high time Dave “takes charge” of not only the communication department in which he is deployed, but also of the situation across NOGO as a whole. To change the system, he needs to change the people, who actually run the system. For this he needs the support of the top management. He himself needs to set up an example by slowly expanding his wings in the HR domain also along with his current role, by putting together policies and procedures in place, thereby, challenging the status quo. To give it an official authoritative flavor that people accord importance to, he should first discuss his pure intentions with the top management, and convince them to officially hand over the additional HR responsibilities to him, at no extra salary. Once done, he should then issue new appointment letters and employment contracts for all telegraph operators and clerks, with a minor change of adding the sentence, “all duties and responsibilities assigned by the management from time to time” to their existing list of duties and responsibilities. To convince employees that they would not lose anything by going beyond what is written in their employment contracts, monetarily, by citing his own example, with the starting point being leveraging his cross-departmental contacts, by first approaching like-minded and influential people, whom other employees consider as thought leaders, in his own circle of friends. This would unleash a chain reaction having a long-lasting impact.
Secondly, since complete union exclusion from the company affairs is not possible, Dave should try to use them to his own advantage, as “companies in late 1960s and early 1970s did in order to quell workplace militancy, such as by accommodating trade unions through negotiation of a centralized relationship with union full-time officers, from which workplace union activists could be separated, in order to not only uphold managerial rights but also to ensure workplace order” (Smith).
Finally, Dave should actively discourage hiring of friends and close relatives by incorporating aligned clauses in the company’s HR system. At the same time emphasis needs to be put on meritocratic hiring in contrast to a nepotism-ridden one. His experience with NOGO till date has only exposed him to colleagues who related to the “who’s who” of the organization, indicating how deeply embedded and inseparable this negative practice is in the bloodstream of the company, therefore, it will be a daunting task. However, the trick lies in attacking the issue taking small successful baby-steps rather than a one unsuccessful giant leap. He should start by fixing up a mandatory small percentage of workforce that needs to be recruited from external sources for example, 10%-20%, thereby, leaving the senior management appeased with the majority hiring figure of 80%-90% through internal employees’ referrals. Simultaneously, with every bi-annual performance evaluation round and even before it, he should keep a track of both the external and internal hires’ performance through regular interaction with their co-workers, seniors and subordinates compare them and communicate the same to the top management. With time, if the external hires’ performance outshines that of the internal ones (which will eventually happen), then he can gradually raise their hiring percentage figure with the top management’s support.
Rashid, M. A., Sambasivan, M., & Rahman, A. A. (2004). The Influence of Organizational Culture on Attitudes Toward Organizational Change . Leadership and Organizational Development Journal, 25(2), 161-179. Retrieved from: http://eprints.oum.edu.my/70/1/influence_of_organizational_culture.pdf
Smith, W. A. (n.d.). Key Issues in Contemporary Employment Relations:Managing Employment Relations. Retrieved from: http://www.oup.com/uk/orc/bin/9780199545438/WilliamsAdamSmith_ch05.pdf
