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The effect of the participatory management approach on employee performance. 11/1/2011 AKUA SERWAA ANSAH Grenoble Graduate School of Business

Research Methods class (MIB31): Final assignment

Introduction Management is a very important element in any business and serves as the driving force for the success of the business. This is frequently an issue of concern for most companies due to its indirect inclination to an individual/employees career satisfaction. According to many researchers who have performed organizational and human resource studies one of the major factors which can induce and as well extinguish motivation in an individual is the management style applied, this they claim also affects an individuals performance at work as well. This study will focus on the participatory method which is one of the most significant methods that has been supported by many research studies. The adoption of a participatory management style involves managers encouraging employees to participate in organizational decision making by permitting them to make contributions and challenge ideas and decisions. Although the final decisions are made by top management, employees are involved in the processes of problem analysis, solutions and the implementation of strategies. This project therefore seeks to study how this style is applied in some selected companies and the kind of positive and negative effects it has on the attitudes of individual employees towards their work. The existence of persons with negative attitudes towards their work in an organization can be a total nightmare for their superiors and their colleagues. How to apply the appropriate styles at the right time would enable supervisors and managers to foster effective cooperation and team work among employees. Recent studies have proven that many modern companies have adopted the participatory management method due to the view that it sustains employee interest in their job. However in some companies they do not tend to produce the satisfactory results that are expected. Although organizational studies have proven that organizational conflicts and tensions cannot be avoided, there is the need to discover the other factors that may prevent the participatory style from achieving the desired results. This will enable managers in general to improve upon their skills and help organizations in decline to make the necessary adjustments to motivate their workers to exhibit better attitudes towards work. These methods will help both the public and private sector businesses and agencies to institute structures that go a long way to increase productivity and provide healthy working conditions for all workers.

The advancement of many businesses towards the use of participatory approaches has been said to stem from the view that fostering participatory management systems in companies fosters good employee relations and productive teams. This has been seen to make such companies more competitive in markets. However various researches that have been conducted on the performance of some companies have produced results showing that clearly, some operate better than others. Some of these findings, according to other schools of thought are results of the fact that the most significant elements for the success of a company are economies of scale, technology, innovation patents and the like. In support of the view that management systems are the foundation on which these economies of scale are built and other elements like technology and patents are managed, this study seeks to recognize that the success of a company cannot be attained without the use of better management practices. However these practices must be applied appropriately since different factors could affect the results produced. The following questions will be addressed: What are some of the features of the participatory management system? To what extent does this management style affect individual employee attitudes in the selected company? Can companies which adopt the same management styles have a significant difference in the performance of their employees? What are those additional factors that create those differences if there are any?

Research Methods class (MIB31): Final assignment

Participative management concepts originated from the theories of scientific management developed by Frederick W. Taylor who emphasized methods of improving economic benefits and employee productivity in the industrial sector. Clear challenges to the infamous Taylorism theory led to the resuscitated interest in seeking better management practices to improve performance in various businesses. However this concept is often looked at and employed as a whole unit. The failures and difficulties that companies face are not assessed by addressing how other factors that could prevent an individual employee from responding to the highly praised style of management and the measures to put in place to control those elements. Research on management systems which promote employee satisfaction is of great value however the participative management style has been constantly appraised and recommended without considering other phenomena which include globalisation and differences in cultures and relationships that could often contradict this management system. This study will contribute to theoretical concepts through its findings on the human resource factors that cause differences in the performance of different employees in a company in spite of the use of these better management systems. Current research statistics have shown that employee satisfaction has remained at a low rate of progression since 2008 and this has therefore had a negative toll on employee engagement in companies worldwide. According to Aon Hewitt, a human resource and management consulting firm, the engagement of employees has decreased to a level (56%) which draws the conclusion that employees have gradually become nonchalant towards organizational success or failure. It emphasises that the greatest dissatisfaction of employees currently focuses on how companies fail to provide the appropriate management techniques that would increase productivity. Furthermore it is the view of employees globally that the link between the performance of the individual to the goal and objectives of the organization is missing in many companies. In the light that recent statistics show that many modern companies have adopted the participatory method for its advantages in improving employee performance and employee commitment, the above results will not be termed as satisfactory for current companies. The findings of this study could therefore be applied practically in organizations to assess the other factors that retard and promote the success of this management style to be able to put it to better use.

Literature Review Defining Management Styles Henri Fayol (18411925) was one of the most influential theorists in contributing to contemporary concepts of management. He envisages management as a functional tool and outlined that it consists of six functions: forecasting, planning, organizing, commanding, coordinating and controlling. According to Robert Tannenbaum and Warren H. Schmidt (1958, 1973) Management styles are the different decision making methods employed by managers and how they relate with their subordinates. In their view managements styles should be applied when appropriate since they are dependent on the current circumstance. Participatory Management Bartle (2007) explains participatory management as the involvement of employees in the decision making processes that affect the organisation. Although members of the authority have the final say in the final decision, the opinions of those affected by the decision are sought.

Research Methods class (MIB31): Final assignment

Employee performance With reference to the Business Chronicles, employee performance criteria is defined as the standards employee attitude towards work in an organisation. This includes the approach with which the employee performs tasks and how well those tasks are executed. According to Markowitz (1996) permitting the workers of an organisation the opportunity to have a certain level of decision making has been found to instill a sense of satisfaction that the work they do is appreciated and considered worthwhile. This therefore strengthens their commitment to their duties and responsibilities and encourages then to put in more effort which improves the organizations productivity. This notion has also been supported by Denison (1990) who found from scientific research that a company with more employee participation shows improved organizational performance. This is attributed to the fact that the participatory approach has been found to increase transparency in decision making. According to Bartle (2007) this enhances the work relationtionship between the manager and the staff by strengthening the level of trust. In another study on management styles, it was found that employees productivity increased more when participatory management strategies were employed than when autocratic management styles were used. According to House (1988), the former clearly projects that the input of employees are greatly valued more than the latter where there are restrictions to employee access to certain levels of powere. Heckscher (1995) supports participatory management style with a solid argument. He claimed that the autocratic style creates an environment of inhospitable in house competition which hinders innovation and growth. The absence of rulebased governing unblocks individual employee creativeness and motivates them. However, Heckscher (1995) noted in his studies of over 250 companies that participatory style does not fully benefit in a situation of restructuring and downsizing. Changing an old, deeply rooted system is time consuming, costly and employees are unwilling. He noted that is such firms that are downsizing or restructuring, beaurucracy and organisational politices tend to increase, which coincides with the primary aim and concept that particpatory style is trying to achieve. Marin-Garcia et al (2007) from another angle highlighted that culture is also another element that affects participation management styles negatively. From various studies they mention that this system has been noted to be more successful in certain cultures like that of America and Japan, while more European cultures suffer with adjusting to this system. This view has been supported by Poutsma (2001) but was however refuted by Lawler (1991) who had done extensive studies to prove that globalisation had rather played an important role in drawing many more American and Western European companies to the use of participatory management systems in their businesses. Dorit Jaeger and Ulrich Pekruhl (2002) have however reviewed various studies from different European countries and realized that there are always inconsistencies. What such differences arise from is what has led to this study and will be addressed in the findings of this research by analyzing the effect of these participatory management styles on individual employees.

Methodology Research conducted by Coyle and Behlolav clearly outline the elements of employee participation which include the expertise and knowledge of employees, how information is shared between management and staff, the type of reward system which is functional in the organisation and the kind of decisions made and how employees are involved in decision making procedures.

Research Methods class (MIB31): Final assignment

This study will focus on the involvement of employees in decision making and how information is shared to be able to analyse the level of participation in the companies which will be used for the study. Then the reward systems will also be included for an in-depth view of how employees feel their worth is valued in the company. The method which will be used for this research will be for acquiring qualitative information to deduce implications about managerial styles applied in selected companies and the role it plays in increasing or decreasing employee performance. This study will be performed in the capital city of the country Ghana which is Accra. Two companies in the service sector will be targeted: Office Automation Systems International Limited which is computer software programming and Hardware Company and a foreign brand image consulting company known as Brand Effect. For both companies sampling will be based on the workers who will be able to provide substantial information therefore with the first company being a medium enterprise, the sample includes Managing Director, General Manager and the other senior and junior staff members, a total of 40 persons will be contacted for information. With the second company, the CEO will be involved as well as the general managers of the HR department, the banking hall and the treasury, then the supervisors and the junior staff members. This will make a total of 60 persons. These individuals will be requested to provide primary data while secondary data will be obtained from internet sources, company journals and business publications. Below are some of the questions which will be constructed for the questionnaires and for some of the interview sessions: How often are staff meetings held in the company? Are employees consulted prior to decision made by management? What are some of these decisions and how important are they to the organization? Are employees allowed to work in autonomous working groups? Are there other groups formed in the company that employees are allowed to participate in? Do employees earn fixed salaries without any bonus incentives? Are there individual or bonus incentives awarded according to the skills of employees? Are there other non-monetary rewards or ways of encouraging employees? The data which will be collected after these studies will enable conclusion to be made on how the participatory management style affects employee performance. Although one evident limitation of this study is its restriction to one country, the availability of data and financial restraints were taken into consideration. Theoretically speaking as well much of similar research have concentrated in specific countries then afterwards the results compared with other studies conducted in other countries. It is therefore expected that the conclusion which will be made in this study will be sufficient answer the main research questions.

Research Methods class (MIB31): Final assignment

Bibliography Allen, J. F., & Judd, B. B. (2007). Participation in decision-making and job satisfaction: Ideal and reality for male and female university faculty in the United States. Human Communication, 10(3), 157179. C. Gill, H. Krieger, 1993. Participation in product and service quality: recent survey evidence from the European community. Total Quality Management Charles Hecksher, 1995. The Failure of Participatory Management. Across the Board 54 (Nov/Dec 1995): 16-21. D. Frhlich, C. Gill, H. Krieger, 1991. Roads to Participation in the European Community : Increasing Prospects of Employee Representative Involvement in Technological Change. Juan A. Marin-Garcia, Tomas Bonavia, and Cristobal Miralles, 2007. The use of employee participation in the USA and Spanish companies. International Journal of Management Scienceand Engineering Management, Vol. 3 (2008) No. 1, pp. 71-80 Kristi M. Branch, 2002. Participative Management and employee stakeholder involvement. Available at : http://www.au.af.mil/au/awc/awcgate/doe/benchmark/ch10.pdf Locke, E.A., & Schweiger, D.M. (1979). Participation in decision-making: One more look. Research in Organisational Behaviour, 1, 265339. Manfred Davidman, 2006. Style of management and leadership. Available at : http://www.solhaam.org/articles/clm2.html Phil Bartle, 2007. Methods to increase staff input in organizational decision making. Available at: http://cec.vcn.bc.ca/cmp/modules/pm-pm.htm S. Gatley, 1996.Comparative Management: A Transcultural Odyssey. McGraw-Hill, London. Sagie, A., & Aycan, Z., (2003). A cross-cultural analysis of participative decision-making on organizations. Human Relations 56(4), 453-473.