Managing Change - image (encounters??) by Eischer

Prominent Change Initiatives

On completion of this seminar you should be able to:

 

This seminar covers

Overview

This seminar considers prominent change initiatives from the last twenty years

Later we will discuss how well British organisations have adopted these methods. For the moment, lets look at the the background to them and the conceptual aspects of the initiatives.

The Call of Japanese Management

In the 1960s Japanese economic advances forced the West to sit up and take note. In the early 1960s, Japanese motorcycles were leading the world motorcycle racing championships and sleak, high specification consumer motorbikes were forcing older, poorly engineered British bikes out of the local market. The same was occuring with motorcars. The 1960s Datsun (Nissan) came with heater and radio already supplied and for the average British motorist the car's reliability was a very significant selling point.

In the mid 1970s it was felt that Japanese success largely stemmed from their particular culture and style of managing human resources and employee relations. A 'Japanese employment system' became the focus of attention as it was seen to be characterised by a highly competent, committed, innovative and productive workforce which featured:

This employment system was embedded in Japanese history and culture and so its potential transferability to the West was questioned. The attitudes and behaviour of Japanese workers and management were difficult to reconcile against what was known of European and US worker-management relations and the instrucmental attitudes of employees towards their jobs.

The mythological picture of Japanese employees was that they were 'workaholics' whose productive efficiencies coincided for example with past ompliance with an authoritarian culture and poorer standards of living than their European and US counterparts. However, as understanding of the Japanese economic system and modes of organisation became better known, it became clear that the myth of the employment system did not explain their competitive success.

So what do we understand by the term "Japanisation"

Such a term does not just mean Japanese employment methods and management practices. Indeed the term is vague and has probably a tendency to be used in a perjorative way to decry what some see as work practices unsuitable for Western workers.

Western organisations have emulated Japanese competitors and there has been debate about the "Japanisation" of Western industry and commerce. From 1995 this subsided as western management teams grow in confidence having absorbed and extended "Japanese lessons" . Also the Japanese economy has taken a turn for the worst and demonstrates structural inflexibilities which are constraining economic growth.

The Japanisation debate was intense in 80s and 90s in the UK and USA where Japanese competition was hurting many industries and where Japanese inward investment was concentrated. Ackroyd (et al 1988) listed the Japanisation movement as including:


Lean production methods of organising and controlling production and service provision feature in "Japanisation" to secure competitive advantage. The engineering industry best exemplifies 'lean production' but there are instances elsewhere. Lean production techniques, combined with commitments to quality management, as an approach involve several techniques many of which are not Japanese in origin. Work at Toyota brought these together as a package and so they are seen to reflect "Japanisation" (Wickens, 1993).

Japanese Manufacturing Practices.

What is 'Quality'?

'This word is meaningless, use it as often as possible' (anon).



How might the following define 'quality' in respect of the service/product of your Organisation or an Organisation with which you are familiar?

'Quality' is one of the main management buzzwords. However, it is an imprecise term.

Coote and Pfeffer (1991) offer four different definitions of quality.


Which of these approaches has been adopted by your Chief Executive, Quality Manager/expert, customer and consumer interest group?

Consider the issue of quality in food. Which approach to defining quality do you think should prevail when public health and food safety issues arise?


Now read Burnes, Chapter 3.

In the quality management literature it is the 'scientific' and 'excellence' approaches which have dominated. However, the public policy debate, as noted above, is increasingly influenced by 'consumerist' definitions of quality. These can impinge upon managerial practice through external regulation.

Total Quality Management (TQM)

TQM has its origins in writings of a number of 'gurus' who have either influenced and/or helped to popularise Japanese management practice in the post-war period.

In practice many of these ideas can be found in contemporary quality management programmes although the precise meaning of concepts such as TQM still remains hazy and ambiguous for many observers (see Dean and Bowen, 1994, p.394).


Consider these definitions of TQM:

TQM ... is a way of managing business processes to ensure complete 'customer' satisfaction at every stage, internally and externally.
(Oakland, 1993)

... the management approach of an Organisation, centred on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the Organisation and to society.
(BS EN ISO 8402, 1995, 27)

At the heart of TQM is the conviction that it is possible to achieve defect free work most of the time. The assertion is phrased in various ways as right first time, working smarter or zero defects. The idea is to strive for perfection in the work, the way an archer aims for the bull's eye on target, or the single-minded way Torville and Dean strove for ice skating supremacy in the international competitions that made them world champions.
(Bank 1992)

In an attempt to introduce more thematic precision in defining the basic tenets of TQM (and usefully avoiding sporting metaphors!) Dawson and Palmer (1994) summarise the main features of the approach in practice as:

In a similar attempt at uncovering the generic properties of TQM, Hill and Wilkinson (1995) identify the prevalence of-


Now read Dawson & Palmer (1994) Quality Management, Chapter 2, and Buchanan & Huczynski, Chapter 10, pp. 288-290.

Quality Circles

Related to TQM are 'quality circles' (QCs). In the prescriptive literature these are described as having the following characteristics:

Quality Circles are different to TQM in that they are meant to be a voluntary rather than compulsory form of task participation. There are also differences in terms of their relationship to existing organisational structure, the level of the Organisation at which they are initiated, scope of application across the Organisation and overall aims, and the type of task participation that they involve (see Box 7.3).

Box 7.3: Differences Between TQM and Quality Circle Concepts
  Quality Circles TQM
Choice voluntary compulsory
Structure bolt-on integrated quality system
Direction bottom-up top-down
Scope within departments/units company-wide
Aims employee relations improvements quality improvements
Task Participation consultative delegative
(Based on Wilkinson et al, 1994)


Are any Total Quality Management or Quality Circle initiatives currently employed in your Organisation? If there are, are they a success? If there are not, do you think they could be successfully introduced?

'Hard' and 'Soft' Sides of Quality Management

The scientific approach to quality management tends to manifest itself in the establishment of bureaucratic procedures for quality assurance or the 'hard' side of quality management. Emphasis is placed on creating a quality-orientated culture within the Organisation which involves establishing routines and procedures to accord with externally accredited quality standards (e.g. BS 5750). In the excellence approach more emphasis is given to 'soft' quality management techniques such as quality circles and total quality management (TQM). Here the emphasis is on Organisation culture rather than procedure and the need to change employee behaviour by changing their attitudes rather than by imposing new rules (see Wilkinson et al, 1990). In the soft approach:

TQM is concerned with moving the focus of control from outside the individual to within: the objective is to make everyone accountable for their own performance, and to get them committed to attaining quality in a highly motivated fashion'.

(Oakland quoted by Wilkinson et al, 1990)

The soft approach to TQM therefore, clearly puts the focus on management of the human resource and organisational aspects of quality management, rather than upon quality management techniques per se.

Both hard and soft approaches have generated extensive discussion and debate over whether they really improve quality or not and there is often considerable confusion in the minds of those implementing TQM over whether it is the hard or soft elements which are the most important. Operations, marketing and financial management, for example, are more likely to focus on hard aspects, whilst personnel and human resource specialists may see the soft aspects as more important. Thus, who owns quality management change programmes in an Organisation - personnel or line management for example - may well have a significant bearing on the nature of the change that is sought.

Power, Control and Quality Management


What do you understand by 'proactive role'


To take a proactive role is to take the initiative, to act rather than to wait upon events and then react to them. It implies having choice and discretion, and using them.

At this point it is worth taking a step back and considering some of the organisational implications of quality management in a little more detail. Oliver and Wilkinson (1992) argue that TQM and similar techniques, in principle, provide workers with more control over the production process. However this can be used against management where low trust and adversarial employment relations exist. This is a major reason for the large investment made by Japanese-owned firms in generating non-adversarial approaches designed to secure employee commitment and consensual employment relations. It follows that failure or inability to do this on the part of British-owned organisations could mean the adoption of quality management and other 'Japanese style' techniques is counter-productive, or at least limited in terms of what can be achieved. How is this line of argument justified?< p>

According to Oliver and Wilkinson, TQM and related management techniques are characterised by three elements:< p>

This means that the power capacity of human elements of the production process is high. The influence of their actions is felt widely throughout the Organisation, the effects manifest themselves rapidly, and the skill levels required by employees are such that their replacement by other workers is difficult. Put another way, employees find themselves in a particularly advantageous position should they be minded to 'throw a spanner into the works'.

Realisation of this new power capacity by management is critical, argue Oliver and Wilkinson, since it results in a need to redefine the management task. They suggest that the problem is no longer one of exercising control in order to reduce employee capacity to engage in behaviour inconsistent with management objectives. Rather it is one of reducing employee motivation to exercise an enhanced power capacity in ways which run counter to what management is trying to achieve.

The latter requires a management approach which seeks to create the following conditions:

But organisations are environments where individuals and coalitions (groups) frequently try to impose their views on organisational issues. In effect; they seek to construct and impose their definition of the situation so as to influence or control the decision-making processes - to create meaning for others. A political or power perspective on the introduction and implementation of TQM brings a number of important factors into focus.

As TQM involves the whole Organisation, it cuts across functions, hierarchies and levels. Many long-standing and cherished relationships are disturbed, and existing power relationships, horizontally and laterally, are subverted or changed, particularly those between employees and their managers.

TQM requires a system of open communications right across and through the Organisation, as it endows employees with a more active part in process improvements and quality monitoring - TQM shifts the responsibility for quality monitoring away from the customers, who did it for free, but at the risk of losing them - onto the work force. With TQM there is likely to be a shift of power downwards, from the manager to the shop floor. The autonomy of Ends (the final decision) might still reside with the CEO, but the autonomy of Means (how to secure those ends) will be captured by those lower down.

TQM is suggestive that wider employee involvement represents a sharing of managerial power on issues concerning improvements in work processes and operation management. TQM when fully implemented, reduces the almost universal gap between knowledge (how to do the job) and power (the right to make decisions). The two - knowledge and power - achieves a better coherence, which would certainly go some way to enhance a competitive advantage. The participation processes of TQM might lead unavoidably to build a greater flexibility into organisational structures. Also in establishing quality teams, members may come from different departments, say, finance and marketing - two different and powerful subcultures - different skiff groups from different status hierarchies, which may inadvertently serve to weaken existing departmental loyalties, reduce and reframe turf battles and produce a realignment of political forces; creating new alliances in support of change and fostering attitudes that support organisational goals for improvement, rather than the status-quo.

TQM however, is not linear (although it can be implemented in a straight line, by some orderly chronology). Indeed the nature of TQM is ambiguous: it is rarely possible to implement some generic Total Quality Management package of philosophies and techniques. At the implementation stage, there might be disagreement about the 'real' nature of TQM. There are sharp differences between TQM as suggested in the work of academics and the TQM packages of consultancy companies.

The objectives of an all-embracing change like the introduction of TQM can be disputed and its imprecise resource requirement questioned. Its ill-defined boundaries may breed suspicions; its high dependence on motivated participants may be doubted. The aim of shared perception of the project's goals may come at too high a price. These uncertainties allow and encourage disagreements and conflict to emerge from many organisational crevices.

These are some of the reasons why the failure rate of undertaking TQM is as high as 73 per cent (Buchanan & Badham 1999, p. 156).

For the moment speculate upon the following:


PILEITHIGHANDFLOGITCHEAP plc. - a well know high street retail chain - is to introduce TQM. The aim of the programme is to make employees provide more personalised, authentic and flexible service to their customers.

As part of this approach front-line employees are to be empowered by giving them more discretion over key aspects of their job. For example, where the price label or bar code is missing from goods, employees are to now be empowered to accept the customer's recollection if they feel they are being truthful about the price. In the past this event required the calling of a supervisor to establish the correct price.

In the light of the new power capacity given to these workers, what implications do you think TQM might have for human resource policy and practice at the firm?

Change as Re-engineering


Please now read Buchanan & Huczynski, Chapter 16, pp. 77-483.


Business Process Re-engineering (BPR) emerged as the management fad of the 1990s inspired by the work of gurus such as Hammer and Champy (1993), Hammer and Stanton (1995) and Davenport (1993). It is also an approach which attracted considerable controversy and criticism. For the most cynical, BPR (Business Process Re-engineering) amounts to little more than the 'Bastards who are Planning our Redundancy'!

The key features of BPR are summarised below (based on Peppard and Rowland, 1995).

  1. Objective: minimises the non-value-added activities in organisations.
  2. Mode of change: seeks radical, immediate and measurable improvements in business performance over short timescales, rather than incremental 'continuous' improvements over the medium to long term.
  3. Organisational design principles: advocates destruction of vertical and functional dimensions of Organisation structures and their replacement by horizontal process-based arrangements based on concepts such as empowerment and team-based working.
  4. Focus: on the outcome of processes - i.e. the customer viewpoint rather than the Organisation or 'producer' viewpoint.
  5. Vision: 'aspirational' or 'idealised' models of organisational improvement dismissal of the history and context of the Organisation and instead presenting a 'blank sheet of paper' upon which the organisation can be 'built again from scratch'.
  6. Role of ICTS: not seen as the core determinant of re-engineering. Rather they are an enabler for the essential re-engineering of organisational processes that are required. As Hammer famously put it: 'don't automate, obliterate' (1990).
  7. Change management: top-down - even dictatorial - approach to change
    management. Resistance to change or contestation of the principles of BPR are not to be tolerated. As Hammer and Champy (1983) put it:

Dramatic improvement has to be paid for in some way, and the coinage is usually denominated in units of suffering. (p. 174)

.... it is necessary to deal with them ('resisters') gently but insistently by pointing out the gaps in their understanding and the errors of their ways. By means of repeated communication and clarification they can be brought onto the straight and narrow ... However, those who are deliberately trying to obstruct the reengineering effort ... need the back of the hand. (P. 183)

Jack Welch of General Electric - the most successful CEO in America - adopted and implemented principles 1, 4 and 7 above, firing 115,000 employees in the process. Welch headed the dominant coalition at GE for over 20 years.


To what extent does re-engineering view change as an 'event' or a 'process'?

Recap

We looked at recent change initiatives in work organisation in response to increasing competition and technological advances, influenced in particular by Japanese management techniques. We sought to define the all-pervasive term 'quality' in relation to these new management techniques. Quality management can be seen as one aspect of a broader approach to managing production/service provision operations. This approach has been termed 'lean production' and owes much to innovations by Japanese firms, both in Japan and more recently in the West. As with other forms of technical change discussed in this module, the management of changes of this type raises not only 'hard' technical but also 'soft' human and organisational issues and problems.

We also looked at Business Process Re-engineering as a response to competitive pressures and the impact of globalisation, introduced in the United States in the first instance, but of increasing popularity in Britain towards the end of the 1990s.

In the final seminar of the module we will review how these change initiatives have been managed in Britain.


  • .
  • In fact this was one aspect of a customer-orientated quality programme introduced by one supermarket chain. The human resource policies and practices introduced to support this programme included:

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    The current fascination in management circles with BPR runs the risk of obscuring key aspects of the change process by presenting an idealised or utopian version of what the Organisation could (or should) be like. It then goes on to exhort Organisation members - often in an evangelistic manner - to bring about change in terms which suggest that this Promised Land can be reached as if it is an event. Organisational politics are seen by proponents of BPR as an irrelevance. This runs counter to the process model of change which views organisational politics - and their management - as key to the successful practice of change management.

    .

    Imperatives and Adaptations

    On completion of the second part of this seminar you should be able to:


    Overview

    Here we consider the impact of Japanisation and look at how LP and TQM techniques have actually been applied in Britain. We then examine the problems and issues that have emerged. We also explore the benefits and difficulties experienced in the implementation of BPR programmes in recent years and attempt to measure the extent of success that such programmes have met with in practice.

    Japanisation in Britain


    List as many recent changes as you can think of in your Organisation which you think likely to have been influenced by Japanese-style management practices. (You will be asked to reconsider this fist at the end of the seminar.)

    Differences between Japan and Britain

    Total Quality Management begins with the realisation that it is relationships which need to be managed - not systems; there is nothing systematic about people. They are not made of inter-changeable parts; they relate to others. Thus, in order to introduce TQM, it is the relationships between finance, production, marketing, research and development, and the firm's entire supply chain which has to be managed. Total Quality Management is about managing relationships; this makes it difficult, costly, time-consuming and rewarding.TQM is not a product; it cannot be imported from Japan and disseminated successfully in an alien culture (UK). For example, the introduction of TQM requires patience, tenacity and sustained commitment from every level of the Organisation; starting at the top, the CEO and the board. The cost (in the UK, TQM is frequently seen as a cost rather than as a value) of which will have to be justified. But UK organisations and their managements are judged over relatively short time-periods; so committing vast investment expenditures to quality improvement, without some measure of cost effectiveness, might be considered an act of blind faith and contrary to Western business culture.In Japan the cultural situation is quite different. Investments in TQM are initiatives taken over long time-periods without thought of immediate benefits. The Japanese have considerable tangible evidence of the wisdom of taking a long view; improvement - the cultural modification of work practices - is a slow, incremental process. Additionally, large Japanese organisations enjoy practices of long-term employment, so changes are introduced by secure, bureaucratised personnel; conditions which are not available to UK organisations. Moreover, performance under TQM in the UK tends to focus on formalised standards and processes, often neglecting staffing issues and linked to individual performances and individual rewards, whereas in Japan TQM emphasises the collective, not individual responsibility for performance.

    Direct Japanisation

    To what extent has British industry and commerce become Japanised? Since the early 1980s direct Japanisation has proceeded rapidly, although from the early 1990s on there has been a reduction in inward investment in the West. However, the proportion of investment going to Asia has increased (see Box 8. 1).

    The Pattern

    Investment Drivers in the 1980s

    Investment Limiters in the 1990s

    (Source: Oliver and Wilkinson, 1992; Oliver, 1993) As one might expect, Japanese-owned 'transplants' have adopted a quality
    management approach and have been instrumental in the diffusion of these and related techniques to their suppliers. Oliver and Wilkinson's (1992) survey of 31 Japanese manufacturing firms located in the UK found that all used or were developing TQM and all used Quality Circles. Typically these arrangements extended into the supply chain.

    Mediated Japanisation

    Mediated Japanisation is also widely evidenced in British organisations, stimulated both by the gaining of 'supplier' status to Japanese transplants and attempts to emulate by those British firms in direct competition with the inward investors. This type of emulation has been reported by numerous studies across a wide range of sectors. However, the use of the Japanese example to legitimate non-Japanese-style changes has also been reported .

    Has your company been in any way affected by mediated Japanisation?
    Can you think of any other UK companies so affected?
    Oliver and Wilkinson (1992) surveyed 66 UK- and US-owned firms. They found most seeking to emulate Japanese competitors. TQM and Quality Circles had been or were being widely adopted, whilst other methods such as JIT were in use in one third of cases and planned in a further third. However, further adoption of Quality Circles was planned in only 5% of cases. The UK car industry provides examples of employers making appeals to the Japanese example. Ford's 'After Japan Campaign' was begun after a fact finding visit to Japan by executives in the early 1980s. It was concluded that fundamental changes would have to be made by Ford in order to compete. However, whilst drawing heavily on the image of the competitive threat posed by Japan, Ford's own change programmes involved little or no attempt to adopt UK Quality Circles or JIT. Downsizing, increased productivity, erosion of demarcation lines and employee involvement were preferred strategies.(Sources: Oliver and Wilkinson, 1992; Beynon, 1982)
    In the mid-1980s Quality Circles attracted the most attention of British managers as the approach achieved 'fashionable fad' status. However, by the end of the decade considerable disillusionment had set in. Quality Circles were rapidly replaced by TQM as the favoured approach to quality management, although in many instances it was the 'hard' quality assurance side of the approach which was to the fore.

    The Adoption of Quality Circles and TQM by British Organisations

    Quality Circles

    The Total Quality Imperative - Schemes and Cultures

    Lean Production or Mean Production?

    How do employees experience and respond to the changes that result from the adoption of quality management initiatives? Earlier doubts were raised on at least two fronts in this regard. First TQM and the like were often being introduced with little regard for BR or employee relations aspects. Second, where these issues are prioritised it is those bundles of policy and practice most likely to serve business rather than quality of working fife objectives that were emphasised. Does this in effect mean that lean production (LP) is, for employees, mean production?

    Guest (1992) argues that 'the traditional and still dominant system of control throughout UK industry is based on compliance' (p. 1 12). Other writers (see, for example, Wilkinson and Willmott, 1995) suggest that quality management and similar schemes, although purportedly aiming to empower workers and generate team-based working, still serve this agenda insofar as they result in: Legge argues that TQM seems to suggest empowerment and delegation on the one hand but centralisation and control on the other. The consequence of TQM for employees is a greater intensification of work and exploitation. Moreover this is emphasised by the use of ICTs to engage in the electronic monitoring of worker performance - for example through the tape recording of conversations between employees and customers in telephone-base service industries such as direct insurance sales or home banking services. The use of what Zuboff (1988) terms the 'panoptic gaze' of electronic technologies conjures up for some commentators an apocalyptic vision of the future of work where employees simultaneously control and discipline themselves whilst under the unseen but watchful technological gaze of their management masters (see, for example, Wilkinson & Sewell, 1992.

    Who is Controlling Whom?
    Compare the following comments made by employees. Quote 1 (a response made during research in the early 1970s in response to work redesign in a chemical plant.):

    You move from one boring, dirty monotonous job to another boring, dirty, monotonous job. And then to another boring, dirty monotonous job. And somehow you're supposed to come out of it all 'enriched'. But I never feel 'enriched' - I just feel knackered.


    Quote 2 (from a study in the late 1980s of an employees response to the introduction of TQM.):

    I'm forty-six and I've been doing this new job for nearly two years and I've been completely turned around. It has given me a new lease of life. I'd rather work this way. It' hard work with more responsibility and more worry, but there is a lot more job satisfaction.


    Quote 3 (from a journalistic account of work at Nissan's UK plant.):

    We're quite subservient. In fact very subservient. If Nissan says shit's toffee, we chew it.

    (Sources: Q3 Popham P., 1992; Q 1 & 2 McArdle et al, 1995) These continents point to the dual face of empowerment and team working. On the one hand employees may be given more tasks, responsibility and discretion which conventional job design theory suggests would increase their commitment, motivation and productivity. On the other, the employees' experience may be of work intensification and greater flexibility (working harder for the same or less reward); high levels of stress through additional and perhaps unwanted responsibility and new accountability; and social pressure from fellow team members to conform and achieve team goals and objectives. The next time your post-person says good morning, ask them what they think of the Post Office's plan to introduce, or introduction of, team working! Others have pointed out that Japanese and other Far Eastern inward investors have exploited situations such as high unemployment and favorable government assistance programmes to 'force' their approach on indigenous workforces and management (Garahan and Stewart, 1992). One recent report suggests, for example, that average wages in South Wales - a major site of Far East inward investment - are now lower than those found in Korea. (Independent on Sunday 20 May 1996). Further controversy has emerged over the problems felt by British managers with their Japanese counterparts. Along with general problems of failure to adapt to each other's cultures, British managers have lodged claims of unfair dismissal, racial discrimination and sexual discrimination against their Japanese employers. (Independent on Sunday, 19 May 1995). However, such claims have also been lodged against British employers.

    Please now re-read Buchanan & Huczynski, Introduction, pp. 4-6, and Chapter 19, pp. 572-576. Then read The Guardian, 25 May, 1996. 'The Company We Keep'.

    Was ASDA an example of 'lean' or 'mean' production under the pre-WalMart-takeover regime of Archie Norman?

    Human Resources, TQM and LP

    The previous seminar introduced some ideas about the relationship between power, control and quality management techniques. It was suggested that success of quality management and other Japanese style production/service provision techniques would be predicated on recognition of the new power capacity that these techniques gave to employees. The implication was that a different approach would be needed to the management of human resources to generate worker commitment to organisational goals and prevent employees from using their new-found power in ways which were inconsistent with these objectives. How far is this reflected in the human resource policies and practices of Japanese owned transplants in Britain and do they differ from their British-owned counterparts? A range of research studies suggests that there is a clear and significant distinction. There has also been a perception, based upon the practices of high-profile inward investors such as Nissan, Toshiba and Sony, that novel employee relations policies have been pioneered based on single-union agreements. Many of these have been presumed to include clauses which prevent stoppages of work - so-called 'no-strike' agreements (Basset, 1986). These agreements have attracted controversy as they arise from attempts by unions to recruit new employers via so-called 'beauty contests' rather than directly attract their employees into membership. Examples can be found at Nissan's plant near Sunderland, Toyota's plant in Derby and several Japanese owned electronics plants in South Wales. In the case of Japanese transplants evidence suggests that a range of HRM policies and practices appear to be used that, whilst not distinctive in themselves, are novel in the sense that they are combined in an integrated approach. Moreover, these 'bundles' of HRM policy and practice appear to be put in place as a precursor to the adoption of quality management and/or other Japanese-style techniques. This contrasts with the approach of British-owned organisations who seek to emulate Japanese-style quality management and other practices. It appears that, whilst many of the HRM policies are present, these are rarely as well integrated, and in most instances emerge at best in parallel and often after techniques such as TQM have been introduced.

    Quality Management at Nissan and Rover

    Both Nissan and Rover pursued the industry trend towards LP, involving the adoption of a host of Japanese-style production methods including quality circles, TQM, continuous improvement, team-based working, and just-in-time (JIT). At Rover this was Facilitated through close collaboration with Honda beginning in 1981 to produce the Triumph Acclaim. In 1986 the first full-time Quality Director was appointed. A form of Quality Circle called 'zone circles' was introduced soon after. However, the human resource policies and employee relations practices showed an interesting contrast with those of Nissan which opened its British plant in 1985. Honda, it seems, was keen to pass on production lessons to Rover but were less forthcoming in relation to the human dimension of their approach. From 1990 until its purchase by BMW, Rover sought to integrate its human resource policies more tightly with its business and production strategies although it still had to secure the overall profitability of the business. However, Nissan's success was blunted by poor marketing which left large stocks of the new Primera model unsold in 1993. This resulted in short-time working and the scrapping of the night shift with a loss of 440 jobs through voluntary redundancy. Nissan Union membership up to Senior Engineer Rover - 1980s: 1990s: 1996 Rover taken over by BMW - the beginning of the end? (Sources: Wickens, 1987; Smith, 1988; Oliver and Hunter, 1994; Taylor, 1996; Stephenson, 1996, Burnes, 2000) <
    img src="../images1/reading.gif"> Please now read the Rover Case Study in Burnes, Chapter 10,
    pp. 3 71-3 79 and the author's comments on p. 3 5 8 and in Chapter 12, pp. 444-447.

    Oliver and Wilkinson's research (1992) draws attention to the lack of synchronisation between the adoption of quality management and other techniques and innovations in HRM in British firms, as witnessed in Rover and Nissan. They also point to the persistence of conventional multi-union arrangements and collective agreements in British plants. This contrasted with the Japanese transplants studied which typically had a range of well-integrated HRM policies such as single status, direct communications, staff-type benefits for all employees, high job security policies and company representative bodies. Further, nearly a third were non-union and over half had single union-agreements. Only one was a multi-union firm (although most of the unionised firms did not have no-strike agreements). The human resource and employee relations approaches of Nissan and Rover Group drawn in the late 1980s and 1990s are contrasted above.


    How far do the HR policies and practices of Japanese transplants and their British-owned competitors address the issues of mutual dependency; resource abundance, and homogeneity of goals and interests?

    Employee Relations Implications of Japanese-style Production Techniques

    In the UK motor industry JIT production has been found to make firms and suppliers very vulnerable to industrial action anywhere in the supply chain (see Turnbull, 1988; Smith, 1988; also Marsden, 1985). The appropriateness of conventional bargaining and trade union representation in the motor industry is challenged by JIT and other Japanese-style techniques. However, the costs associated with changing this structure (effectively replacing a multi-union system based on collective bargaining with a single or non-union system where the role of collective bargaining in pay determination is minimal or non-existent) are too great for existing firms to contemplate (except in new greenfield investments).

    What they're trying to do is to introduce a Japanese way of working but without the benefits you have in Japan. If this was a Japanese factory in Japan you would have a job for life; your wife would work for the same firm; there'd be crèches, whatever.

    (Foreman, Ford Dagenham, Independent 8 February 1992)

    Do you share the foreman's view? What key factors do you think likely to hinder successful introduction of Japanese-style work methods?
    The implication of these findings is that many UK emulators may have inappropriate human resource and industrial relations arrangements for the full benefits of quality management and other Japanese-style techniques to be felt. Indeed, in the absence of appropriate HRM policies and practice, the adoption of these techniques may even be counter-productive . As Oliver and Wilkinson (1992) conclude: In the absence of personnel and industrial relations systems which make such action unlikely, companies adopting Japanese style manufacturing practices may be inviting trouble ... Workers are not slow to identify choke points. (pp. 89-90) This latter point begs the important question of what are the 'appropriate' HRM policies for TQM and the like and whether these are the same for au organisational circumstances.

    What would you consider to be appropriate HR policies and practice to complement Japanese-style management practices?
    Recent research in the USA suggests that there are common 'bundles' of HR policy and practice (training and development; bottom-up and top-down communications; team work and flexibility; employee participation; incentive systems) which if increased together do have a positive affect on competitive performance regardless of the circumstances and context of the firm (Pfeffer, 1994). Godfrey et al (1996) report preliminary findings from a UK study of the adoption of TQM which suggests similar findings. They argue that TQM works most effectively from a business viewpoint when accompanied by the following bundle of HR policies and practice: The one area that did seem highly dependent upon contingent circumstances, such as market and financial position, was incentive or reward systems. However, this does not mean that the quality of working life of employees was improved, since HR policies and practices associated with this (such as work redesign, abolition of clocking-in; payment of high wages and narrowing of the gap between the highest and lowest paid in the Organisation) were in the main being ignored. This raises the issue of how beneficial TQM and 'Lean Production' in general are from an employee viewpoint (see below).

    Now read HiII, S. (1995) 'From Quality Circles to Total Quality Management'.

    The Role of the HR Function

    The importance of HR issues to the success of TQM and other Japanese-style initiatives raises once again the role of the HR function in the management of this kind of change programme. Wilkinson and Marchington (1994) identify four roles for the HR specialist in managing TQM change: The role that it is appropriate for the HR function to play depends upon several factors, in particular the stage in TQM implementation where they become involved. Similarly the type of role that the function can play is also dictated to some degree by circumstances, in particular the existing role and status of the personnel function and whether a hard or soft TQM approach is being pursued by the Organisation. There are also pitfalls. The change maker role might be attractive from the point of view of the status and power of the specialism in an Organisation, but it also carries high risks and penalties should the initiative go wrong. Contrary to the views of some who have suggested TQM is 'instant pudding' for the HR function in the sense that it will give it new legitimacy, status and power, Wilkinson and Marchington (op. cit) present a more complex picture of the opportunities and threats posed.

    Lean Production and TQM in the UK

    Have UK organisations really found it difficult to come to terms with quality management? The practice of Quality Circles seemed to fail with possible reasons being: Hill (1991 p. 353) concluded that quality circles became an irritation. Their interventions disrupted managers' routines. There was no 'pay-off' for the latter or reason to make them work. The returns were small - lots of talk, little progress. The activities, membership, processes of the circles: For TQM programmes as a whole adoption has been widespread and general programmes have been less problematic. It is probably right to conclude that all organisations would claim to have high level commitments to quality and a sustainable quality assurance system in place. But to conclude that 'change' has been sustained in the long term is a more difficult proposition. Wilkinson et al (1992 op. cit), suggested that a typical TQM project proceeded through several stages: What evidence is there that TQM programmes encountered problems of sustainability? Wilkinson (op.cit) points to cases of disappointments reported by some organisations. He summarises reasons for this as follows: Legge (1995 p.227) sums up:

    ... from a managerial viewpoint, the verdict points to much enthusiasm variable success in implementation and, as with most change initiatives in UK industry, the suspicion that in all but the exemplar companies, the underlying philosophies...are compromised by economic exigencies and an endemic short termism that both seeks a quick-fix and lacks the stamina for the long haul.

    The failure of large-scale adoption of TQM by British organisations, which have allowed themselves to be 'compromised by economic exigencies, endemic short termism', the search for quick fixes and the lack of stamina for the long haul is a reminder of the powerful role of culture in society and organisations.

    The Importance of Culture

    Culture is a reflection of shared values, shared beliefs, shared meaning, shared understanding and a shared 'sense-making' of our world. The formation of culture is a slow, evolutionary, incremental process of reality construction. It facilitates a better grasp of particular events, actions and situations in a distinctive way. It helps us to make sense of our world. Gareth Morgan points to the Sociologist Harold Garfinkel who highlighted our taken for-granted skills by pointing out what happens if we deliberately set out to disrupt normal patterns of life:

    Look a fellow subway passenger in the eye for a prolonged period of time. He or she will no doubt look away at first but get increasingly uncomfortable as your gaze continues. Perhaps he will eventually enquire what's wrong, change seats or get off at the next stop. Behave in your neighbour's house as if you live there. Disrupt the smooth and continuous lines of your walk down a crowded street with a series of random stops and turns or with the shifty manner of a suspicious character. In each case you will gradually discover how life within a given culture flows smoothly only in so far as one's behaviour conforms with unwritten codes. Disrupt these norms and the ordered reality of life inevitability breaks down.

    (Morgan, G., 1997, Images of Organization, p.139)

    Similarly, at the micro level of the Organisation, we discover the enactment of a shared reality. This enactment view of culture has enormous implications for our understanding of organisations as cultural phenomena; which means that to understand why British organisations failed to adopt TQM we must focus our understanding of organisations on the processes that create systems of shared meanings: culture, in short. This fruitful insight has been developed by Tom Peters and Nancy Austin in A Passion for Excellence, 1995, which emphasised that successful organisations build cohesive cultures (vast areas of shared meanings) to create an appropriate focus for doing business. Strong organisational cultures: 'IBM means service'; 'Sell it to the sales staff' (Hewlett-Packard), are built around such core values. The more these values are operationalised and held, the more difficult they are to change. Total Quality Management never became a core value, a cultural disposition, a shared conception in British organisations. What was required was a paradigm change - a new way of looking at things - and this was not forthcoming from British senior management. The adoption of TQM would have required a cultural revolution which can be led only from the top. This did not take place. Cultural revolutions are slow, painstaking processes, requiring 'stamina over the long haul', which was lacking. This is unsurprising; as many as 70 per cent of firms that set off on this particular cultural renewal, failed. They failed because they were unable to breach the dominant culture (current constructed realities) and the political distribution of power upon which it rests. The successful adoption of TQM by British firms would have required a transformation of prevailing mind-sets and a redistribution of political power. In short, the creation of a new reality, which would in itself have been counter-cultural. Unlike Japanese firms which see TQM as a long-term investment, British organisations reside in a cultural milieu of short-termism and the search for quick fixes; success in the here and now.
    Now check back to the list of Japanese-style changes you drew up for your organisation at the start of the seminar (p.2). List any additions or modifications. Have appropriate BR policy and practice changes been introduced in tandem?
    From the American perspective, Cameron & Quinn (I 999) argue that 'organizations that have implemented quality initiatives in order to enhance effectiveness ... have, by and large, fallen short' (p.7). They cite a 1997 survey of the Fortune 500 companies carried out by Rath and Strong, an American consulting firm, which found that only 20 per cent achieved their quality objectives. A McKinsey study of 30 quality programmes found that over 66 per cent had 'stalled, fallen short, or failed' (p. 8). On an even wider scale they cite Ernst and Young who studied 584 companies in four industries surveyed in the US, Japan, Canada and Germany and found that most considered TQM a failure and were reducing quality budgets.

    The BPR Controversy

    What do you think the problems of introducing BPR might be in your own Organisation?
    A survey of 168 UK-based medium and large organisations conducted in the mid-1990s reported by Willcocks and Grint (1996) found that - despite the exhortations by BPR gurus - high risk, radical BPR approaches were generally not being taken by organisations in Britain. This was despite the fact that 59% of the sample were already undertaking or planning to undertake BPR. Perhaps as a result, very few organisations were found to be achieving what could be called 'breakthrough' results from their BPR programmes. When Willcocks and Grint looked at the organisations that had completed BPR programmes, using a relatively conservative 'breakthrough' benchmark of 20% profitability gain, 20% revenue gain and 10% decrease in costs of doing business, only 18% of these organisations had achieved significant financial benefits from BPR on all three measures. The reasons for these failings were: Both point strongly to the policies of change management as a critical factor determining success. Beyond basic principles, it is difficult to pin down in practice what re-engineering is. Consider an example of BPR in practice .

    Re-engineering Ford's Accounts Payable Department

    Peppard and Rowland 1995 provide the often-cited example of Ford's North American accounts department as an example of what radical BPR can achieve. Before the BPR programme commenced, Ford employed 500 people in its accounts payable department. Initially management thought this could be reduced to 400 by rationalisation and automisation. However, it was then noticed that Mazda (part owned by Ford in Japan) had an accounts workforce of only five people doing essentially the same task. By re-engineering the process much of the paper work and cross-checking associated with the department's task were either eliminated or automated. As a result a 75% not 20% reduction in headcount was achieved. One problem is that many BPR proponents claimed that organisations who engage in restructuring, with its attendant labour shedding activities of downsizing, delayering, displacement and so forth, are not engaged in 're-engineering' at all, despite their frequent claims to the contrary. This is because restructuring is viewed as a reactive response to existing organisational conditions rather than an aspirational leap to a new kind of organisational future based upon customer requirements. Amidst this confusion, a re-engineering backlash was soon in evidence:
    There is a new look menu over at The Consultant's Cafe. Good old soupe du TQM and change management pate are off. Perhaps you would care to try some business process re-engineering (BPR) instead? Corporate diners beware. BPR, that nouvellest of consultant cuisine, bears no resemblance to a standard Saturday night take-away. Except in one respect. Like the curry house special, no one knows exactly what it is. (Oliver, 1993, p. 18).
    Now read Burnes, Chapter 7, pp. 250-253.
    According to Burnes (op. cit), the failure rate of business process re-engineering as a change strategy is estimated at about 70 per cent in the USA and about 60 per cent in Europe (p.253). Three particular facets of BPR programmes may be argued to be particularly< problematical: Cameron & Quinn (I 999) describe re-engineering as 'the attempt to redesign completely the processes and procedures of Organization' (p.8). However, despite the focus on process which processual approaches to change would advocate, but BPR is not a 'context-sensitive' approach, in a wide sense. The 'fresh start' idea ignores both history and context and organisational politics are seen as irrelevant. This runs counter to the process model of change which views organisational politics as central. It therefore may be argued as failing to address a key agenda that the competent change agent must address: the process agenda which demands interpersonal and political skills in negotiating and selling change. According to Cameron & Quinn (op. cit.) 'nearly every organization of moderate size or larger has engaged in downsizing in the last decade' (p.8). As a policy for improving organisational effectiveness, they argue that downsizing has generally proved unsatisfactory, and claim that only 9 per cent of companies who have introduced downsizing achieved improvement in quality, while the majority acknowledged having failed to achieve desired results. Downsizing was found to lead to loss of organisational experience and learning and widespread deterioration in employee morale. Cameron & Quinn cite a survey carried out in six industrialised countries which 'found that less than half had achieved their cost-cutting goals' (p.8). We've already looked at the problems raised by neglect of cultural factors in the context of TQM initiatives. Cameron & Quinn (1999 op. cit) cite a survey conducted by the American originators of the BPR concept of 497 US companies and 1245 European companies. 69 per cent had initiated at least one BPR project. 85 per cent of these found little or no gain resulted. A key finding of the consultants was that re- engineering needed to be integrated with culture change initiatives. According to Cameron & Quinn (op. cit),

    ... the failure of reengineering (as well as TQM and downsizing) occurred in most cases because the culture of the organization remained the same. The procedure was treated as a technique or program of change, not as a fundamental shift in the organization's direction, values, and culture (p.9).

    Conclusion

    The adoption of Japanese-style production/service provision techniques is not just a question of adopting and mastering the techniques. Effective change of this type means giving attention to changing human and organisational policies, practices, structures and cultures as well. The key to Japanese success, is close fit between the use of such techniques and the way people are managed.This raises questions for the role of the personnel specialist.

    Does this 'fit' really produce committed workers who share the same goals as management or is lean production really 'mean production' where controls on employee behaviour are replaced by more insidious surveillance and cultural controls.

    Theories of change are rooted in existing organisational theories and managerial thought but they need also

    OD and the strategic choice perspectives on managing change challenge rationalist approaches to change.

    The module focused on change initiatives of the last twenty years: LP, TQM and BPR. The influence of Japanese management techniques have stimulated a new, 'post-Fordist' paradigm of Lean Production (LP). There is uncertainty and disagreement about what exactly is involved in BPR. Various well-known programmes have introduced new working methods and we have debated the success these.

    Threats to employment through downszing, increases in employee stress and weak attention to concomitant cultural change play a part in difficulties experienced by companies in achieving desired outcomes.