Why Quality Circles Failed but Total Quality Management Might Succeed

This paper examines how companies have sought to develop employee participation in the quest for business improvement, from the quality circle (QC) fad of the early and middle 1980s to total quality management (TQM) at the end of the decade. Thirteen companies provide evidence of the strategies adopted and support previous findings that circles collapsed as the result of inadequate organizational design which encouraged managerial recalcitrance. Moreover, TQM departs from traditional 'cycles of control' and looks likely to institutionalize participation on a permanent basis, and managerial employees as well as office and shop-floor staff now have more opportunity to participate in decisions. TQM is not another passing fashion, because it can meet the interests of employees while providing top management with an effective way of organizing in the new times.     

The Influence of Unions on CSR: Is There a Trade-Off Between Employee-Oriented and Non–Employee-Oriented Policies?

Strategic managers are consistently faced with decisions of how to allocate a company's scarce resources to meet the demands of shareholders and other powerful and legitimate stakeholders. This article analyses whether higher union density at company level pushes management to engage more in corporate social responsibility (CSR). Drawing from stakeholder theory and the resource allocation approach of CSR as well as union voice and monopoly models, this article finds that companies have to substitute non–employee-oriented CSR with employee-oriented CSR as union density increases but is still at low levels. At higher levels of union density, companies can complement both types of CSR. This perhaps represents a reinforcement of mutual interests between management and organized labour, which has implications for managerial prerogatives as well as union positioning in the labour and political process.     

British Managers' Attitudes and Behaviour in Industrial Relations: A Twenty-Year Study

A unique longitudinal study of Britain's managers conducted in 1980, 1990 and 2000 permits comparisons of managerial attitudes and behaviour in industrial relations over twenty years. We find clear evidence of the relationship between macro‐level political and economic movements of the period from 1980 up until the late 1990s on managerial attitudes, the impact of changes in power relations and the ‘lag effect’ of institutions. The most unexpected findings are the modest rise of managerial unionism in the 1990s and the limited evidence of the replacement of collective bargaining by either individual or group involvement or by employee financial participation.     

Should Firms Consider Employee Input in Reward System Design? The Effect of Participation on Market Orientation and New Product Performance

Will increasing employee participation in reward decisions increase new product performance by first increasing a firm's level of market orientation? Literature offers limited insight to the effects of listening to employees regarding reward system design and whether this may influence market orientation implementation and new product performance. This paper provides research to fill the gap by examining the relationship between participation‐based reward systems, market orientation, and new product performance. Based on expectancy theory, a conceptual model was developed suggesting that participation‐based rewards will increase market orientation by considering employees' desires regarding performance rewards. To test the model, a mixed method was used to collect data. First, in‐depth interviews were conducted with managers from 11 different firms to verify the proposed model. Then a multi‐industry sample of managers from 290 firms was surveyed to maximize generalizability of the results. Data were analyzed using structural equation modeling techniques to simultaneously fit the measurement and structural models. The findings show that market orientation significantly impacts objective new product performance and mediates the relationship between participation‐based rewards and objective new product performance. Participation‐based rewards positively affect market orientation but surprisingly affect new product performance negatively, while positively moderating the relationship between market orientation and new product performance. The results suggest that managers should include employee input in designing reward systems. However, managers should also be careful of how much input they allow employees in determining their rewards and goals as more input will improve market orientation or responding to information collected by, and disseminated throughout the firm, and that, in turn, will improve some types of new product performance. However, the direct effect of employee input can decrease new product performance suggesting that there may be a trade‐off between various success measures of new products developed and introduced by the firm.     

Information technology change,work complexity and service jobs: a contingent perspective

We examine the contingent impact of implementing an enterprise‐wide information technology system (Enterprise Resource Planning) on perceptions of work complexity in clerical, technical and managerial service sector jobs. Using matched and control samples of employee survey data, we compare pre‐ and post‐intervention perceptions of work complexity and importance of analytical skills across three hierarchical job levels: clerical, technical and managerial. We find that employees in clerical jobs, at the lowest level in the hierarchy, experience a significant increase in work complexity and need for analytical skills, whereas those in technical and managerial service jobs do not. Implications for theory, management of technology and employment policy are discussed.     

When Do Companies Train Low-Skilled Workers? The Role of Institutional Arrangements at the Company and Sectoral Level

The article investigates how institutional arrangements at the organizational and sectoral level affect the likelihood and size of employer investments in continuing training for low-skilled workers in Germany. By building on comparative political economy and organizational theory, hypotheses are derived and tested. Regression analysis based on the IAB Establishment Survey (waves 2011 and 2013) shows evidence that the training participation of low-skilled workers is related to institutional differences between sectors and organizations. At the organizational level, structures of employee representation and formalized HR policies are positively associated with higher rates of training participation among low-skilled workers. Moreover, there is evidence that low-skilled workers benefit in organizational clusters that are characterized by structures of employee representation, formalized HR practices, and bargaining coverage. At the sectoral level, this study finds evidence that low-skilled workers in the health care and manufacturing sector are more likely to receive continuing training.     

A Formula for Success? Training,Reward and Commitment in a Chemicals Plant

Managerial strategies designed to elicit greater employee commitment in production have received much attention in recent industrial relations reseach. Training is seen to form a core component of such strategies, yielding such beneficial outcomes as improved efficiency and employee motivation. Yet the connections between training strategy and performance outcomes have been treated in an overly simplistic fashion. This in turn reflects a lack of empirical inquiry at the level of the shop-floor currently to be found in the subject area. By integrating an investigation of the workplace into the analysis of management strategy and performance outcomes, it is possible to develop a deeper understanding of the linkages between training provision, commitment and systems of reward.     

The Relationships of Informal High Performance Work Practices to Job Satisfaction and Workplace Profitability

Recent empirical evidence reveals considerable divergence between management reports and employee reports regarding organizational high performance work practices (HPWPs). This divergence implies that employees may not participate in some HPWPs that are formally present in their organizations, but also, that employees may participate in HPWPs that are not formally present in their organizations. In this study, we examine the implication of the latter case (i.e., employee participation in “informal” HPWPs) for employee‐level and organization‐level outcomes. Our analyses, using data from the Statistics Canada Workplace and Employee Survey, suggest that employee participation in informal HPWPs is associated with enhanced job satisfaction and workplace profitability in a similar way as employee participation in formal HPWPs is associated with these outcomes.     

Why Do Firms Adopt Profit-Sharing and Employee Ownership Plans?

Profit-sharing and employee ownership in companies have attracted considerable interest, yet there has been little research on factors predicting the adoption and maintenance of these plans. This study uses new data from a survey of 500 US public companies, and panel data on corporate financial variables, to examine factors predicting the presence and adoption of profit- sharing and employee stock ownership plans (ESOPs) in the 1975–91 period. Several findings support productivity-related motivations for such plans (including higher R&D levels among old profit-sharing firms, and recent adoption of job enrichment programmes among new profit-sharing firms), while others support flexibility-related motivations (including higher variance in profits prior to the adoption of profit-sharing plans and ESOPs). Unionized firms were less likely to have either type of plan in 1975, but equally likely to adopt them subsequently (often in concessionary contracts). Comparisons of cross-sectional and panel results illustrate advantages of panel data in disentangling the causes and effects of profit-sharing and ESOPs.     

Old wine in new bottles? Revisiting employee participation in Industry 4.0

This paper aims to critically examine employee participation in Industry 4.0, with a systematic literature review. A total of 58 studies were reviewed, resulting in a categorisation of the literature into three perspectives. The ‘techno‐optimist’ and the ‘socio‐technical’ perspective dominate in the reviewed papers. They both confirm a trend that frames employee participation in a unitarist tradition, which emphasises synergies between managerial efficiency and (mostly individual) participation, leading to high innovation potential. The third perspective is rooted in critical studies. Authors writing on the latter subject predict more standardisation and centralisation, and the continued demise of collective and representative forms of participation. To better understand the role of employees in Industry 4.0, we suggest confronting the current discourse with robust empirical research. On that basis, we reject both technological and social determinism, and we acknowledge the structural ambiguities and multidimensionality of employee participation in technological transformations.     

The effects of participatory programmes on productivity in selected multinational organisations

This study examines the potential for increasing productivity through the use of participatory programmes in multinational organisations in Saudi Arabia. Three hundred and forty middle managers selected randomly from 100 Saudi Arabian based multinational companies were surveyed. From a total response of 236, 184 usable questionnaires were obtained. Two published, validated instruments on organisational characteristics were used in the study. The findings show that by using participatory programmes and activities, such as team-building and employee participation in decision making and problem solving often increase organisational productivity. Sixty two percent of the respondents expressed an over-whelming support for participative group management system rather than other management approaches.Parts of this paper were presented at the 1988 Southwestern Academy of International Business meeting, November 2–5, 1988.     

The effects of managerial ownership on international and business diversification: Balancing incentives and risks

Research has examined the effects of managerial share ownership on business diversification, typically from the incentive alignment perspective. Yet, share ownership also shifts risk to managers (the efficient managerial contracting perspective). Furthermore, the effects of managerial ownership on international diversification are unexplored. We examine how managerial ownership influences both international and business diversification in light of the trade‐off between incentive alignment and risk bearing. Based on the differing risk profiles of the two types of diversification, we argue that incentive contracts with higher levels of managerial ownership will be inefficient, i.e., counter to shareholder interests—reducing international diversification and increasing business diversification. Our findings support our arguments for international diversification. We find no significant effect for business diversification after accounting for endogeneity and serial correlation. Copyright © 2013 John Wiley & Sons, Ltd.     

False Self‐Employment,Autonomy and Regulating for Decent Work: Improving Working Conditions in the UK Stripping Industry

A large‐scale study of working conditions in UK‐based strip dancing clubs reveals that dancers are against de facto self‐employment as it is defined and practised by management, but in favour of de jure self‐employment that ensures sufficient levels of autonomy and control in the workplace. While dancers could potentially seek ‘worker’ or ‘employee’ status within the existing legal framework, their strong identification with the label ‘self‐employed’ and their desire for autonomy will likely inhibit these labour rights claims. We propose an alternative avenue for improving dancers’ working conditions, whereby self‐employed dancers articulate their grievances as a demand for decent work, pursued through licensing agreements between clubs and local authorities and facilitated by collective organization.     

Crosscurrents in Workers Participation

As I contemplate developments in recent years relating to participation in management, I am impressed by the uncertainties, the shifting tides of thought, the atmosphere of experimentation. At the level of participation theory, there is more rather than less doubt. A few years ago in the United States, optimistic theories like those of McGregor and Likert regarding workers needs and desires for self-actualization seemed to be sweeping the field; today they are regarded as psychologically inadequate and faulty. In England the theory of joint consultation is confronted with something of a polarization - either toward apathy or toward codetermination. In Israel the ideology of participation, derived originally from socialist theory, has been subjected to increasing challenge from pragmatic considerations of efficiency and profitability. Profit-sharing plans, after a hundred years of experience and a widening acceptability, do not necessarily entail increased worker participation. At the level of practice, the dominant note once again is uncertainty rather than a clear progression toward either success or failure. Neither the Scanlon Plan in the US nor the Glacier Metals experiment in England have generated many followers. Joint consultation schemes appear generally to have declined in number. In Israel Koor experiments in joint management at the plant level have frittered away. Participation has not even been seriously tried in Australia. Reports from Yugoslavia and Germany, where participation programs have been most fully developed, raise questions about the impact of participation on the productivity and efficiency of the enterprises involved, as well as the degree of involvement of workers. On the other hand, there are some positive currents. The spread of collective bargaining to the local level in England and other European countries, the rising interest in productivity bargaining, the absorption of joint consultation committees by unions - all point in the direction of more worker participation in management, although the model may be one of bargaining rather than integration. Out of these crosscurrents we can distinguish some of the main problems confronting the advocates of greater workers participation in management:

• 1 How to persuade managers that their professional interests are best served by cooperating, if not taking the lead, in different types of participation schemes.
• 2 How to convince workers that “participating” is worth the effort, and how to educate them in various forms of the process.
• 3 How to involve worker representatives in both administration and policy-making on a basis other than bargaining that will not estrange them from their constituents.

Resolution of these problems will depend in part at least on recognition that participation is a multi-dimensional process, that different types of participation may work better with regard to different issues or subjects (depending on requirements of technical knowledge and time), and that participation expectations and arrangements may vary with the different levels of an enterprise.     

The Effects of Employer Matching in 401(k) Plans

This paper uses data from the April 1993 pension supplements to the Current Population Survey (CPS) to investigate the impact of employer matching and employee tenure on participation levels in 401(k) plans. While earlier studies examine similar issues, this study makes several advances. First, consistent with the theory that employers may use matching contributions to satisfy nondiscrimination rules, the study shows that correcting for the endogeneity of employer matching substantially increases the estimated effect of matching on participation levels. Second, the study provides evidence that the large positive association between employee tenure and 401(k) participation is because "stayers" tend to be "savers."     

Corporate governance antecedents to shareholder activism: A zero‐inflated process

Research summary: Shareholder activism has become more widespread, yet the role of corporate governance as antecedent to shareholder activism remains equivocal. We propose a new conceptual model that characterizes the stochastic of observable shareholder activism as a compound product of two latent components representing (1) shareholder activists' propensity to target a company and (2) executives' propensity to settle activists' demands privately. Our model explicitly decouples corporate governance expectations for the two latent components embedded in activism process, and thus allows us to relax assumptions of homogenous shareholder interests and constrained managerial discretion where corporate managers are expected to negotiate privately and settle only value‐creating activist demands. Bayesian analysis of zero‐inflated Poisson regression reveals that corporate governance relationships with activism vary across shareholder demands and private settlements. Managerial summary: Increasing shareholder activism has generated debates as to whether activism promotes managerial accountability and responsibility or instead encourages managerial short‐termism. Our research model allows for heterogeneous interests among a company's shareholders. We theorize and empirically investigate a broader role of corporate governance: governance mechanisms need to ensure that executives are not (1) ignoring activists' value‐increasing demands or (2) accommodating activists' value‐decreasing demands in a private, opaque manner that disenfranchises other shareholders. Our results indicate that corporate governance implications differ for visible shareholder demands in contrast with private activism. A plausible application of our model is that it provides estimates of the probability of the numbers of shareholder demands to be received by a firm and the probability of privately settling a demand. Copyright © 2015 John Wiley & Sons, Ltd.     

A comparison of British and Japanese industrial energy management

This paper compares methods of energy management in Japanese and British industrial companies. It is based on the premise that Japanese industry has been more successful at adopting energy conservation measures and aims to highlight differences between the two countries' approaches to energy management.
In both successful Japanese and British companies the value of energy monitoring and target setting is stressed. In Japanese companies the information gained from monitoring is pushed out to the shopfloor employees who can use the information in 'good housekeeping' campaigns. In British companies monitoring information is usually held centrally, thus reducing its usefulness in good housekeeping. The decentralisation of information in Japan, coupled with the encouragement of employee participation results in Quality Circle type exercises aimed at implementing energy conservation measures.
At the investment level of energy management co-ordination and systematic thinking is necessary in order to prevent sub-optimisation of investments. Japanese companies are notable for their very detailed explicit planning of energy management, something few if any British companies practice. This planning process, as well as encouraging employee participation through being bottom up, also encourages systematic thinking about the linkages of energy conservation investments to other parts of the business such as new plant investment and marketing.
As well as the managerial factors the legal requirement in Japan for companies with a certain energy consumption to have a qualified energy manager with certain legally defined duties helps to encourage energy conservation.     

Determinants of alliance partner choice: Network distance,managerial incentives,and board monitoring

Research Summary: We ask if managerial opportunism is a significant problem in alliance partner choice and examine the role of corporate governance mechanisms in explaining this choice. Using a sample of 313 alliances of U.S. firms from the pharmaceutical and biotechnology industries from 1992 to 2010, we find that managerial incentives lead to managerial preference for relationally risky distant partners over existing and new close partners. Further, board monitoring encourages managers to pursue existing and distant partners over new close ones, choices aligned with shareholder interests. In addition, we find that board monitoring substitutes for managerial incentives in alliance partner choice. We contribute to the literature on alliance partner choice to identify an important, and hitherto, unexplored perspective. Managerial Summary: This article examines whether managers and shareholders view alliance‐related risks differently, and how the divergent interests between managers and shareholders affect alliance partner choice. We argue that managers’ concern about their loss of employment and compensation from alliance failure impedes the choice of relationally risky alliance partners that may increase shareholder value. We also argue that managerial stock ownership and board monitoring mitigate this managerial propensity. Our findings suggest that stock ownership owned by managers and strong board monitoring are effective governance mechanisms to align managers’ interests with those of shareholders. Our study offers a novel perspective to understand alliance partner choice by viewing the firm as an entity comprised of fragmented interests.     

Corporate social responsibility as an employee governance tool: Evidence from a quasi‐experiment

Research summary : This study examines whether companies employ corporate social responsibility (CSR) to improve employee engagement and mitigate adverse behavior at the workplace (e.g., shirking, absenteeism). We exploit plausibly exogenous changes in state unemployment insurance (UI) benefits from 1991 to 2013. Higher UI benefits reduce the cost of being unemployed and hence increase employees' incentives to engage in adverse behavior. We find that higher UI benefits are associated with higher engagement in employee‐related CSR. This finding suggests that companies use CSR as a strategic management tool—specifically, an employee governance tool—to increase employee engagement and counter the possibility of adverse behavior. We further examine plausible mechanisms underlying this relationship. Managerial summary : This study examines whether companies employ corporate social responsibility (CSR) to improve employee engagement and mitigate adverse behavior at the workplace (e.g., shirking, absenteeism). We find that companies react to increased risk of adverse behavior by strategically increasing their investment in employee‐related CSR (e.g., work‐life balance benefits, health and safety policies). Our findings have important managerial implications. In particular, they suggest that CSR may help companies motivate and engage their employees. Hence, companies dealing with employees that are unmotivated, regularly absent, or engage in other forms of adverse behavior, may find it worthwhile to design and implement effective CSR practices. Further, our findings suggest that CSR can be used as employee governance tool. Accordingly, managers could benefit from integrating CSR considerations into their strategic planning. Copyright © 2015 John Wiley & Sons, Ltd.     

The Productivity Effects of Participatory Employment Practices: Evidence from New Japanese Panel Data

We report the first results for Japanese firms on the effects of clusters of participatory employment practices (or participation/employee involvement at the top level as well as at the grassroots level, and financial participation) by estimating production functions using new panel data. We find that the introduction of a group of complementary practices will lead to a significant 8–9 percent increase in productivity. However, the full productivity effect is felt only after a long developmental period.