Course Title: Managing Organisations

Course Code: MGT 701

Task 1: On-line Discussion Board Activity –

30%

Student: Alison Hay - 1055131

Prepared for Lecturer: Dr J. Whiteoak
Submitted: 14 October, 2010

“Do visionary Employee Empowerment techniques

such as those implemented by the company Semco
generate a more productive workforce or does
success lie within the fundamentals of Effective
Leadership.”

The concept of improving employee productivity and satisfaction

through increased work autonomy has historically led to a variety of
managerial operatives that give employees a sense of control over
their work and workplace. One such organizational intervention
which has gained popularity over the past few decades is
Empowerment. (Furnham, 2005). Empowerment by definition has
been extensively analyzed, Gandz (1990) writes, "Empowerment
means that management vests decision-making or approval
authority in employees where, traditionally, such authority was a
managerial prerogative." (p. 75).

Employee empowerment has helped companies like Semco achieve

decades of high profitability and growth despite unstable economies
and changing markets. Daft (2008) outlines that Semco
encourages people to seek challenge and explore new ideas and
business opportunities and also question the ideas of others within
the company.

Semler the creator of Semco and its empowerment application

administers the basis of three values: employee participation, profit
sharing and open information systems. Participation gives people
control of their work, profit sharing gives them a reason to do it
better, information tells them what’s working and what isn’t.
(Maresco & York 2007) Semler creates an environment of respect
within the organization by reducing the hierarchical structures built
by previous leaders. (Morgan & Zohar 1999)

With reference to the initial part of my topic question, as to whether

these empowerment methods are effective, on-line student reaction
generated positive response. Many shared the similar views that
empowerment holds a remedy for satisfaction as it promoted a
sense of value, power and contributed to employee loyalty.
Poignant issues were raised making reference to it as an often
under-rated tool which employees and managers can utilize to drive
productivity.

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However successful implementation of empowerment programs
seems to be the biggest challenge organizations face and popular
press regularly report "failed" empowerment efforts. (Harrison
Barnes 2009) Argyris (1998) argues that when Empowerment is
used as the ultimate criteria of success, it covers up many of the
organizations deeper problems. He lays claim to suggest that
many CEO’s subtly but intentionally undermine empowerment.

Although research and data suggests huge success rates with

employee productivity when increasing responsibility, Hackman &
Oldham (1980) believe that the strength of this desire is great only
in some areas and also conclude that statistics rarely report
negative reactions to increases in job quality.

Programs designed to encourage empowerment are often rife with

inner contractions and send out mixed messages like “do your own
thing – the way we tell you”. (Millward 2005). Millward outlines
that empowerment programs have limitations in establishing
working conditions that encourage employee commitment and often
fail to realize that morale and employee satisfaction are not the
ultimate criteria in organizations, the ultimate goal realistically is
company performance.

This leads me to the second part of my topic, effective leadership

the area which received a general overall affirmative consensus.
Most debate participants concluded that although empowerment
has many benefits these rewards need to be incorporated and then
facilitated by effective leaders.

Leadership has traditionally been seen in terms of influence and

moving a group towards a goal. Stogdill, a pioneer in leadership
defined leadership as “the process of influencing the activities of an
organized group in its effort toward goal setting and goal

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achievement” (Stogdill, 1974). Leadership involves actions that
engage group members to direct and coordinate their work.
(Tjosvold & Tjosvold 1995). So what are the makings an effective
leader? President Eisenhower stated ‘leadership is the ability to
decide what is to be done, and then to get others to want to do it’.
(Tjosvold & Tjosvold 1995). There are almost as many theories on
leadership as there are leadership theorists (Walker, C. 2005)

On-line discussion provoked discussion outlining the importance of

leaders to communicate and work towards achieving the company’s
defined mission, vision and goals. Further Student debate which I
also support emphasizes the importance leaders to mobilise
employee self-esteem and morale. A further angle which effective
leaders can adopt in influencing employees is through expectations
as an effective device for improving employee effort and
performance. (Rosenthal 2003; Jones1977; Livingston 1969).

There was a supported consensus that employees must be trained,

guided and coached by Leaders in the right direction to achieve the
goals of the organisation. Effective leaders should adopt the
approach of Fiedler (1967) proposing that leadership effectiveness
depends on the match of a leader’s style with the situation.
(Millward 2005).

Fiedler’s contingency model outlines that the leader’s effectiveness

is based on situational control which embraces task and relationship
behavior. These behaviors include listening, encouraging,
facilitating, clarification and socio-emotional support. (Reece &
Brandt 2005)

Leaders should exercise caution that in the facilitation of employee

satisfaction they can fall into the realm of Country Club
Management which Reece & Brandt (2005) view as a low concern

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for production and high concern for people. Managers should take
steps to prevent employee unhappiness and dissension but require
a strategy for the organizations ultimate productivity.

Leaders need the respect and support of their teams they manage.
Ricardo Semler (1994) views leadership by stating ‘only the respect
of the led creates a leader’. Data results gathered recently provide
supporting evidence that self-worth from superiors empowers
subordinates by increasing their perception of control. Employees
reciprocate by performing in accordance with supervisor’s
preferences. Leaders who utilize empowering practices are viewed
as fair by their subordinates. (Kellerl 1995)

In conclusion I agree with the majority of the on-line participants in

stating that the principle of empowerment is a very necessary
function within the body of successful organizations. It is however
Effective Leaders which fundamentally shape the success with well
planned strategy and efficient leadership methods. When
incorporating these functions this will ultimately lead to employee
satisfaction, staff retention and further increase workforce
productivity.

References:

Argyris, C. Harvard Business Review on Managing people: Empowerment

– the Emperor’s new clothes - 1998 Harvard Review Press

Daft, R. Organizational Theory and Design. tenth edition, USA 2008

Cengage Learning

Feidler, F.E. A theory of leader effectiveness, New York, 1967 - McGraw-

Hill

Furnham, A. The Psychology of Behavior at Work, NewYork. 2005 -

Psychology Press.

Gandz, J. The Employee Empowerment Era. Business Quarterly, 1990 55-

2, p. 74.

Hackman, J.R & G.R Oldham. Work Redesign. 1980 Reading, MA, USA:
Addison-Wesley

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Harrison Barnes, A Failure of Employee Empowerment Programs -
Source [on-line] : http://EzineArticles.com/?expert=A_Harrison_Barnes )
Article Submitted: October 21, 2009 as read 14 October, 2010.

Jones, R.A. Self-Fulfilling Prophecies: Social, Psychological Effects of

Expectancies 1977 - Hillsdale, N.J Erlbaum

Kellerl, T. Leadership and Empowerment: A Social Exchange; School of

Management, State University of New York, NY 1995 [on-line]
http://hum.sagepub.com/content/48/2/127.short gathered on 14 Oct,
2010.

Livingston, J.S. “Pygmalion in Management”, Harvard Business Review

(1969): 81-89

Maresco & York. Ricardo Semler: Creating Organizational Change through

Employee Empowered Leadership Volume 3 – issue 2 2007 [on-line] as
read 12 Oct, 2010
http://www.academicleadership.org/emprical_research/Ricardo _semler

Millward, L. Understanding Occupational and Organizational Psychology

2005 Sage Publications

Morgan, G & Zohar, A 1999, Ricardo Selmer’s Transformation at Semco

[on-line] Available from URL: http:/www.leadership-development.com/d-
ingredints.html [accessed on 23 July 2000]

Reece, B & Brandt, R. Effective Human Relations: Personal and

Organizational Applications, Houghton Mifflin 2005

Rosenthal, R. Convert Communication in Laboratories, Classrooms and the

Truly Real World 12, Current Directions in Psychological Science 12: 151-
154.

Semler, R. 1994 Maverick!, Arrow Business Books, London.

Stogdill, R.M., Handbook of Leadership, New York: free press. 1974

Tjosvold, D & Tjosvold, M.M. Psychology for Leaders - Canada Wiley &
Sons. 1995

Walker, C. Effective Leadership – Twelve Words to Live By, Tennessee,

USA 2005 [on-line] http://www.wclct.com/EffectiveLeadership.2.1.pdf

Appendix: Response to On-Line Discussion Topics

Question 1: Author – Brice Barraud.

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Could a military model of leadership, such as the U.S. Marine Corps, be
adequate to any company, as far as it based most on authority and discipline?

My Response:

Military Style Leadership embodies the in doctrine of Mentorship i.e.: primary role
of leaders is to mentor and train a protégé or apprentice. This method requires
regular, consistent formal and informal counseling designed to support and
ultimately improve performance. This is a highly efficient, accurate method which
promotes accountability, establishes a communication system for ideas and
concerns to flow and ultimately develops new leaders via example. It is effective
as it also promotes continuity and teamwork.

Even within a regime like the US Military there will still be differing personality
traits/style of their many Leaders. 'Strategic Leadership' style stresses the
competitive nature of running an organization and being able to out wit one's
competition. In these current economic times is this not a necessary tool and
quasi-survival method.

Question 2: Claire Irwin

Emotional Intelligence is the 'ability to monitor one's own and others' feelings and
emotions, to discriminate among them and to use this information to guide one's
thinking and actions.' (Salovey & Mayer 1990, p. 189).

"Do leaders that possess a high level of Emotional Intelligence achieve better job
success in their role of managing an organisation and its people, or, do leaders
that possess a high IQ and technical skills achieve better job success in their role
of managing an organisation and its people?"

My Response:

I believe that Emotional Intelligence would be significantly more important for

Leaders to be successful in managing people. There are many Leaders with top
Mensa IQ's who will obviously make a fast transition into top roles however
despite their incredible intelligence have limited intuitive people skills. As Brice
points out these people will acquire the respect of their subordinates for their
ability and performance but when problems arise within the fundamentals of
human resource management they may not possess the ability to identify and
respond. Personality classification indicators such as the Myers Briggs identifies
attributes which can assume certain people as natural leaders and are not limited
to mere IQ.

Question 3: Author – John Baby

Does "Human capital investment" help organization attract the best employees
and retain its workforce?

My Response:

I can see the advantages in issues all of you raised on the values and advantages
of Human Capital Investment with regard to staff retention but I would like to
raise a new thought, when you dissect the question of 'Human Capital' and then
look at the organisations 'Investment' it brings the notion of Human Capital Risk.

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Thousands of organisations invest toward their full time employee’s further
education so they can ultimately produce economic value. Karl Marx's capitalist
theory embraces the notion of labor power sold by workers to receive
wages/benefits. However Marx also distinguishes between one's capacity to work
and activity of working. If a company is not achieving maximum surplus value
from certain employees I consider it completely feasible to out-source cost
effective labour. This could be in the capacity of casual employees (without
benefits), utilization of a private company's part time services or the assignment
of freelance consultants. I agree that in key positions 'Human Capital Investment'
is essential and these benefits could be supported and funded by cutting an
organisations unnecessary labour expenditure.

Question 4: Author – Joshua McGoldrick

My topic centers on the role of values within an organization. I have been very
lucky to work within corporations that champion integrity as a key tenet of how
employees at all levels should operate. General Electric, one of those corporations
is famous for promoting the concept of operating within the "spirit and the letter"
of the values. What this means is that one should not only comply with the
"letter" of the policy, but also demonstrate the "spirit" via behavior and attitude.
Another large corporation I have worked in had all the right "letter" guidance and
policies however the "spirit" was lacking in its culture and after a short while I
joined a company that did and I am still there.

I am Interested to hear other experiences / views on how companies have

promoted their corporate values and whether it had a bearing on your happiness
and performance.

My Response:

Sounds like you have worked in some amazing companies and as a result have a
great set of benchmarks with which to evaluate an organisations values and
success.

I have been employed within an industry of very Tayloristic endocrine. Although

highly paid with bonuses for high performance/longevity their "Norms" i.e.:
expectation of behavior, focused primarily upon compliance of rules/procedures
and promoted Autocratic leadership styles. I have lay witness to a revolving door
of resignations and retrenchment. Organisations with such ideologies as you
mention, who value not only their people's honesty and skills but encourage
employees to grow, build upon their attributes and promote vitality will
undoubted prosper. Recruitment and training costs run high in corporate
budgets when these costs could go toward development, team building
programs and employee rewards.

Question 5: Author – Cherryl Carless

Many leaders of organisations tend to immediately seek technical solutions to

adaptive challenges. An example of this is the use of drug and alcohol testing of
employees (technical solution) when the underlying cause is the drinking culture
(perhaps behavioral). Another is pay rise for unhappy and unmotivated
employees (technical solution) doesn't fix the source of the unhappiness (perhaps
behavioral).
Does this address the actual problem or some of the symptoms and in so doing, is
it a failure of the leader to really diagnose the problem?

My Response:

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I believe Leaders should have an ability to intuitively deal with the source of case
specific behavioral issues that arise within the work environment. In saying this
we cannot all be psychologists but Leaders should adapt and use a wide range of
strategies appropriate for the person, group or situation. Your example of a using
a technical solution like drug testing could result in the loss of some high
performance, key players who were never an issue. Research suggests people in
leadership roles will always possess certain styles/traits however successful
leaders should diagnose then match leadership styles/behaviour to the
group/individual. e.g.: Hersey & Blanchard (1982)