- 1. A) Using Walton, Cutcher-Gershenfeld and McKersie’s strategic negotiations framework (Table 6.2) in Chapter 6 of the Boxall and Purcell text, how would you describe the old management’s strategy?
- The strategic negotiations framework described in the chapter is a behavioural approach to managing employee relations in the organization (Walton, Cutcher-Gershenfeld, & McKersie, 1994). Given the decisions made by the HR manager, the strategic negotiations framework is divided into three types of approaches. First is “fostering” approach that requires total commitment from all the members, and then comes the “forcing” approach which involves bargaining tactics and the third is the “escape” approach which is implemented in the circumstances when the HR managers are scared of the implications of management change. After studying the strategy implemented by the old management, it is evident that the management resorted to “escape” approach. It is termed as the escape approach for the following reasons:
- Confronting the issue: the strategy implemented was an escape approach because the HR manager’s choices were motivated by substantial objectives. He aimed to restructure the employment contract to improve profitability. Also, fearing the outcome, the HR manager resorted to discussing the initiative with full-time union official rather than workforce union delegates who held actual control over employee relations.
- The process involved: the HR manager’s escape approach was evident from the lack of explanation that he delivered to satisfy the union delegates. He merely stated that annualization would lead to equal wages without explaining the “why” and “how”.
- B) Examining the factors identified in the table, how would you rate the choice of this strategy? What most likely accounted for the poor performance of the strategy?
The management did not explain the issue to union delegates. By keeping a limited view of their process, the management was forcing implementation of annualization and then merely ensuring achievement of ends. In the light of this issue, the strategy is rated to be poor because it failed to take into notice the increasing bargaining power in the labour market. Also became oblivious to union and employees’ strict resistance to change.
- Strong bargaining power: the labour market was buoyant due that it had strong bargaining power. Management did not realise this and forced its decision on the employees. This alerted the union, and they opted to resist the change.
- Multiple parties involved: The HR director was oblivious to the influence union delegates had as opinion leaders. In an attempt to escape the situation, the issue was confronted with the wrong party leaving workforce angry.
- Using the Walton, Cutcher-Gershenfeld and McKersie framework (above), how would you describe and rate the company’s new employee relations posture once the old CEO left?
The new management was able to incur partnership with the union delegates and instil trust among the workforce as well as the unions that made their approach much better than the previous management’s approach. Thus, it was possible because the new management tried to do away with all the issues that were bothering the workforce and resorted to the “going rate” rather than annualization. However, the new management considered it necessary to address the inefficiencies in the current system for which the new HR director confronted the union delegate and settled on conducting an efficiency study by a third party consultant. The choice of the consultant satiated both the workforce and management and secured employee’s willingness in becoming a part of the survey. When the results of the efficiency report were established, it was found out that 10% of the population will have to be laid off. This could have been a difficult task had the management not involved a representative of the workforce. The result was voluntary resignation and compensated those leaving their jobs at good rates.
In conclusion, the new strategy followed by the management was a fresh approach at dealing with employee relations. It addressed issues and differences in the organization rather than ignoring them which allowed the new management to understand the concerns and needs of employees as well. Also, the approach implemented by the new management was geared at shaping attitudes rather than forcing a new system upon the workforce. This is in contrast to the old management’s strategy that did not address the concerns of employees and chose to coerce the new system upon them.
3. Using the framework of voice systems and management style, what style would you recommend for this company going forward and why?
The framework of voice systems is a culmination of different relations with employees and different set of relations with union so that when the intermingling of these relations occurs, various management styles evolve (Walton & McKersie, 1991). The model is presented in the form of a continuum extending from two extremes. At one extreme, there is high control influence management style. At the other extreme, there is a high commitment and high cooperation influenced management style. Movement from one extreme to another requires risk, dedication and goal orientation. The previous management team operated on the first extreme of the voice framework owing to their enforcing and highly controlled management style. The new management operates near the other extreme working towards achieving trust and cooperation. For the future wellbeing of the company, the other extreme of the company entailing trust and cooperation is recommended and can be achieved by following the given steps:
- Relation with employees: the relationship with employees should be based on trust. Every decision should be made with the employees in the loop to ensure understanding of the issue. Efforts should be made to secure the welfare and job of the employees (Lowe, 2008).
- Relationship with union: relation with unions should be based on cooperation. This will only happen when the management gives due respect to the union rather than undermining their authority. By making, union delegates a part of the discussion or decision-making process, partnership with the union can be established that is vital for a contended workforce (Lowe, 2008).
Applying this style to the present scenario, the management should take following steps:
- The management should commit to not repeat the same mistakes such as confronting wrong party with the issue and forcing change on employees, in the future.
- The business plan must be constructed stipulating the requirements to realize goal accomplishment that in this case is shifting towards annualization and then addressing all criticisms on that business plan.
- Finally, discussion must be initiated with the concerned party in the union. In the case of annualization, shift patterns can be defined according to employee’s willingness and comfort. Also, abolition of the overtime rate must be reached out at this stage.
References:
Lowe, R. (2008). “The Future of Work: Implications for Unions, Relations Industrialism”.
Industrial Relations, Vol 53, No. 2.
Walton, R., Cutcher-Gershenfeld, J., McKersie, R. (1994). “Strategic Negotiations: Theory of
Change in Labor-Management Relations”. Cambridge. Harvard Business School Press.
Walton, R. & McKersie, R. (1991). “Behavioural Theory of Labour Negotiations”. New York, 2nd edition.
