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(I) Introduction: Three groups of managerial decisions affect the workers of any industrial establishment and hence the workers must have a say in it.
Economic decisions methods of manufacturing, automation, shutdown, lay-offs, and mergers. Personnel decisions recruitment and selection, promotions, demotions, transfers, grievance settlement, work distribution. Social decisions hours of work, welfare measures, questions affecting work rules and conduct of individual workers safety, health, and sanitation and noise control.
Participation basically means sharing the decision-making power with the lower ranks of the organization in an appropriate manner. Definitions: The concept of WPM is a broad and complex one. Depending on the sociopolitical environment and cultural conditions, the scope and contents of participation changes. International Institute of Labour Studies: WPM is the participation resulting from the practices which increase the scope for employees share of influence in decision-making at different tiers of organizational hierarchy with concomitant (related) assumption of responsibility.
ILO: Workers participation, may broadly be taken to cover all terms of association of workers and their representatives with the decision-making process, ranging from exchange of information, consultations, decisions and negotiations, to more institutionalized forms such as the presence of workers member on management or supervisory boards or even management by workers themselves (as practiced in Yugoslavia).
The main implications of workers participation in management as summarized by ILO: Workers have ideas which can be useful; Workers may work more intelligently if they are informed about the reasons for and the intention of decisions that are taken in a participative atmosphere. (II) Scope and ways of participation (Forms): One view is that workers or the trade unions should, as equal partners, sit with the management and make joint managerial decisions. The other view is that workers should only be given an opportunity, through their representatives, to influence managerial decisions at various levels. In practice, the participation of workers can take place by one or all the methods listed below: 1. Board level participation 2. Ownership participation 3. Complete control 4. Staff or work councils 5. Joint councils and committees 6. Collective Bargaining 7. Job enlargement and enrichment 8. Suggestion schemes 9. Quality circles 10. 11. 12. Empowered teams TQM Financial participation
He or she can prevail upon top management not to take measures that would be unpopular with the employees. He or she can guide the Board members on matters of investment in employee benefit schemes like housing, and so forth.
Problems associated with this method: Focus of workers representatives is different from the focus of the remaining members of the Board. Communication and subsequently relations between the workers representative and the workers suffers after the former assumes directorship. He or she tends to become alienated from the workers. As a result, he or she may be less effective with the other members of the Board in dealing with employee matters. Because of the differences in the cultural and educational backgrounds, and differences in behaviour and manners, such an employees representative may feel inferior to the other members, and he or she may feel suffocated. Hence, his or her role as a director may not be satisfying for either the workers or the management. Such representatives of workers on the Board, places them in a minority. And the decisions of the Board are arrived at on the basis of the majority vote.
Drawback: Effect on participation is limited because ownership and management are two different things.
Work committees are a legal requirement in industrial establishments employing 100 or more workers. Such committees discuss a wide range of topics connected to labour welfare. Examples of such committees are welfare committee, safety committee, etc. Such committees have not proven to be too effective in promoting industrial democracy, increasing productivity and reducing labour unrest.
7.
Participation
through
Job
Enlargement
and
Job
Enrichment:
Excessive job specialization that is seen as a by-product of mass production in industries, leads to boredom and associated problems in employees. Two methods of job designing job enlargement and job enrichment are seen as methods of addressing the problems. Job enlargement means expanding the job content adding task elements horizontally. Job enrichment means adding `motivators to the job to make it more rewarding. This is WPM in that it offers freedom and scope to the workers to use their judgment. But this form of participation is very
basic as it provides only limited freedom to a worker concerning the method of performing his/her job. The worker has no say in other vital issues of concern to him issues such as job and income security, welfare schemes and other policy decisions.
Advantages: Employees work place. Organization gets to enjoy higher savings-to-cost ratios. Chances of QC members to get promotions are enhanced. become involved in decision-making, acquire communication and analytical skills and improve efficiency of the
Features of empowered or self-directed teams: Empowered to share various management and leadership functions. Plan, control and improve their work. Often create their schedules and review their performance as a group. May prepare their own budgets and co-ordinate their work with other departments.
o Usually order materials, keep inventories and deal with suppliers. o Frequently responsible for acquiring any new training they might need. o May hire their own replacement to assume responsibility for the quality of their products or services Titan, Reliance, ABB, GE Plastics (India), Wipro Corporation and Wipro InfoTech are empowering employees both frontline as well as production staff, and are enjoying positive results.
New principles of TQM are: Meet the customers requirement on time, the first time, and 100% of the time. Strive to do error-free work. Manage by prevention, not correction. Measure the cost of quality. TQM is called participative because it is a formal programme involving every employee in the organization; making each one responsible for improving quality everyday.
This
method
involves
less
consultations
or
even
joint
decisions.
Performance of the organization is linked to the performance of the employee. The logic behind this is that if an employee has a financial stake in the organization, he/she is likely to be more positively motivated and involved. Some schemes of financial participation: Profit-linked pay Profit sharing and Employees Stock Option schemes. Pension-fund participation.
Pre-requisites for successful participation: Management and operatives/employees should not work at crosspurposes i.e. they must have clearly defined and complementary objectives. Free flow of communication and information. Participation of outside trade union leaders to be avoided Strong and effective trade unionism. Workers education and training. Trade unions and government needs to work in this area. Trust between both the parties. Workers should be associated at all levels of decision-making. Employees cannot spend all their time in participation to the exclusion of all other work. Limitations of participation: Technology and organizations today are so complex that specialized workroles are required. This means employees will not be able to participate effectively in matters beyond their particular environment. Everybody need not want participation.
The role of trade unions in promoting participative management has been far from satisfactory.
Participation at the Board Level: Representation of employees at the board level is known as industrial democracy. This can play an important role in protecting the interests of employees. The representative can put all the problems and issues of the employees in front of management and guide the board members to invest in employee benefit schemes.
2.
Participation through Ownership: The other way of ensuring workers participation in organizational decision making is making them shareholders of the company. Inducing them to buy equity shares, advancing loans, giving financial assistance to enable them to buy equity shares are some of the ways to keep them involved in decision-making.
3.
Participation through Collective Bargaining: This refers to the participation of workers through collective agreements and by deciding and following certain rules and regulations. This is considered as an ideal way to ensure employee participation in managerial processes. It should be well controlled otherwise each party tries to take an advantage of the other.
4.
Participation through Suggestion Schemes: Encouraging your employees to come up with unique ideas can work wonders especially on matters such as cost cutting, waste management, safety measures, reward system, etc. Developing a full-fledged procedure can add value to the organizational functions and create a healthy environment and work culture. For instance, Satyam is known to have introduced an amazing country-wide suggestion scheme, the Idea Junction. It receives over 5,000 ideas per year from its employees and company accepts almost one-fifth of them.
5.
Participation through Complete Control: This is called the system of self management where workers union acts as management. Through elected boards, they acquire full control of the management. In this style, workers directly deal with all aspects of management or industrial issues through their representatives.
6.
Participation through Job Enrichment: Expanding the job content and adding additional motivators and rewards to the existing job profile is a fine way to keep workers involved in managerial decisionmaking. Job enrichment offers freedom to employees to exploit their wisdom and use their judgment while handling day-to-day business problems.
7.
Participation through Quality Circles: A quality circle is a group of five to ten people who are experts in a particular work area. They meet regularly to identify, analyze and solve the problems arising in their area of operation. Anyone, from the organization, who is an expert of that particular field, can become its member. It is an ideal way to identify the problem areas and work upon them to improve working conditions of the organization.
Employees can participate in organizational decision making through various processes mentioned above. However, there are other ways such as financial participation, Total Quality Management, participation through empowered teams and joint committees and councils through which they
can contribute their share in making the organizations a better place to work.
2. Training, which involves raising the skill levels of employees and offering development opportunities that allow them to apply new skills to make effective decisions regarding the organization as a whole? 3. Employee decision making, which can take many forms, from determining work schedules to deciding on budgets or processes. 4. Rewards, which should be tied to suggestions and ideas as well as performance.
employees to increase productivity in order to achieve their goals. Employees who participate in the decisions of the company feel like they are a part of a team with a common goal, and find their sense of selfesteem and creative fulfillment heightened. Managers who use a participative style find that employees are more receptive to change than in situations in which they have no voice. Changes are implemented more effectively when employees have input and make contributions to decisions. Participation keeps employees informed of upcoming events so they will be aware of potential changes. The organization can then place itself in a proactive mode instead of a reactive one, as managers are able to quickly identify areas of concern and turn to employees for solutions. Participation helps employees gain a wider view of the organization. Through training, development opportunities, and information sharing, employees can acquire the conceptual skills needed to become effective managers or top executives. It also increases the commitment of employees to the organization and the decisions they make. Creativity and innovation are two important benefits of participative management. By allowing a diverse group of employees to have input into decisions, the organization benefits from the synergy that comes from a
wider choice of options. When all employees, instead of just managers or executives, are given the opportunity to participate, the chances are increased that a valid and unique idea will be suggested.
involvement with an open mind. They must be open to new ideas and alternatives in order for participative management to work. It is important to remember that although the manager may not agree with every idea or suggestion an employee makes, how those ideas are received is critical to the success of participative management. Employees must also be willing to participate and share their ideas. Participative management does not work with employees who are passive or simply do not care. Many times employees do not have the skills or
information necessary to make good suggestions or decisions. In this case it is important to provide them with information or training so they can make informed choices. Encouragement should be offered in order to accustom employees to the participative approach. One way to help employees engage in the decision-making process is by knowing their individual strengths and capitalizing on them. By guiding employees toward areas in which they are knowledgeable, a manager can help to ensure their success. Before expecting employees to make valuable contributions, managers should provide them with the criteria that their input must meet. This will aid in discarding ideas or suggestions that cannot be implemented, are not feasible, or are too expensive. Managers should also give employees time to think about ideas or alternative decisions. Employees often do not do their most creative thinking on the spot. Another important element for implementing a successful participative management style is the visible integration of employees' suggestions into the final decision or implementation. Employees need to know that they have made a contribution. Offering employees a choice in the final decision is important because it increases their commitment, motivation, and job satisfaction. Sometimes even just presenting several alternatives and allowing employees to choose from them is as effective as if they thought of the alternatives themselves. If the employees' first choice is not feasible, management might ask for an alternative rather than rejecting the employee input. When an idea or decision is not acceptable, managers should provide an explanation. If management repeatedly strikes down employee ideas without implementing them, employees will begin to distrust management, thus halting participation. The key is to build employee confidence so their ideas and decisions become more creative and sound.
b. Work Committees:
The Industrial Disputes Act of 1947 provides for establishing work committees in every establishment employing hundred or more workers. This legislation thus makes it compulsory for the organisation to ensure employee participation. The work committee consists of equal number of members of workers and employer. The employers representatives are nominated by the employer and should be those who are connected with the firm and have day-to-day contact with workers. The workers representatives are elected from among the workmen engaged in the firm in consultation with the union. The main function of the works committees is to promote measures for securing and preserving amity and good relations between the employers and the workers. The works committee is normally concerned with day-today problems of the firm. Their task is to smooth away any fiction that may occur between the management and the workers. Despite the noble intentions of the Act, works committees have not been very successful due to the following reasons: a. Workers representatives on these committees lack the competence to carry out their responsibilities well. b. Unions consider these committees as a threat to their existence as employers prefer to talk to these committees rather than the union. c. Some employers consider it below their dignity to sit on these committees along with the workers.
d. There is lack of interest among workers in works committees as they
concentrate only on minor issues pertaining to wages, bonus, etc are not included.