INTRODUCTION

Human capital is one of the most important assets in most businesses, and increasingly so in a knowledge society. Employees, from the top of the hierarchical structure to the bottom are the present and future of a company’s potential success. A company needs to achieve maximum output out of its employees both physically and intellectually. The purpose of this review is to understand what role participative management plays in employee satisfaction and productivity. Participative management is a process in which influence is shared among individuals who are otherwise hierarchically unequal (Wagner, 1994). It is a system which encourages employees to participate in the process of making decisions that directly affect their work lives (Ali, Khalequie, & Hossain, 1992). Participative management is utilized to improve work practices, productivity,and organizational performance (Gilberg, 1988; Vroom, 1960).

Participative Management is the type of management in which employees at all levels are encouraged to contribute ideas towards identifying and setting organizational-goals, problem solving and other decisions that may directly affect them. It is also called consultative management.

Participative management is a part of the broader concept of Employee Involvement. Employee involvement is defined as a participative process that uses the entire capacity of employees and is designed to encourage increased commitment to the organizational success. However, participative management is a technique of joint decision making; That is, subordinates actually share a significant degree of decision-making power with their immediate superiors.

Participative management increases performance, productivity, job satisfaction and motivation. However there are papers that doubt the efficiency of participative management. But there also are situations in which participative management; saying can be time-wasting and counterproductive. It can reduce people’s effectiveness and job satisfaction´ (Herman 1989). Robbins (2003)says that there are dozens of research showing that participation has only a modest influence on productivity, motivation and job satisfaction. But the problem is not in participation itself. Participation is effective if it is done in the right conditions and with the right implications

Participative management has clear goals and does not turn over the organization to employees. There is still a hierarchy but it is not a dominant hierarchy, which dictates everything to employees. A non-dominant hierarchy has as many levels as are necessary to do the work of the organization. People have clear roles and responsibilities and manage themselves as much as possible. Management tells people what the strategy is and what is

[1]

expected in terms of results and then allows people to figure out the how to deliver on management expectations. Top management still decides strategy and front line employees still focus on their primary tasks. The difference is that the criteria for superior performance are utilized and leveraged for the success of the organization. The criteria for superior performance are drivers of behavior, reasons why people get up in the morning and are enthusiastic about their work. Pay is considered a satisfier all things being equal.

THE METHODOLOGY

Participative management is a method, which gives employees responsibility, accountability, and authority over their work. The method provides simple tools for employees to improve their work performance and positively impact the bottom line. The process provides an environment to make employee needs known and creates a vehicle for improved communication between all areas of the organization. What differentiates this work is that people's recommendations are actually implemented and acted upon. People solve their own issues and feel empowered within the process of doing so. Executives and employees learn to redesign their workplace to be participative and self-managing. This does not mean you do away with management. People are not asked to do things that they are not capable of accomplishing. There may be training involved to improve skill sets. This does not resemble laissez-faire management in any way. Managers and employees look at a piece of work and ask what roles and responsibilities need to be placed within the boundaries of the work in order to achieve individual and organization goals? The idea is to allow as much responsibility, accountability and reasonable authority to people actually doing the work. Participative management addresses the criteria for superior performance. These criteria have been researched, field-tested, around the world and their validity has been proven in many work settings. Participative management creates a workforce that is committed to obtaining positive results for the organization such as increased productivity and improved quality. People are engaged and motivated and are willing to put forth energy to improve work performance. Participative management works best when the organization has a clear and compelling mission and vision. Employees then can align their personal mission and vision to the organization. The criteria for superior performance are:

a. Control

b. Learning

[2]

c. Variety

d. Mutual Support and Respect

e. A Promising Future

f. Engage one or several of their preferred life interests

g. Challenges that match and stretch individual skills

h. Concentration and Focus

i. Fun

When the criteria for superior performance are leveraged in an organization the performance will dramatically improve. This has been demonstrated over and over again in thousands of organizations all over the world.

Management in most organizations is constantly attempting to get people more involved in improving the organization. People run up against a brick wall because of the bureaucratic structures that still exist in their organizations. This occurs even after many attempts at improvement. Management has not made it to people's advantage to participate, communicate, and share what they know with teammates. Why participate and give ideas for improvement when they are disregarded and not rewarded. People will always do what is in their best interest. If the stated culture of the organization is one thing and the actual behavior of management is not congruent with how management behaves, then people do not trust what is communicated by management. People are very resourceful and learn to survive in any

[3]

culture. Management can attempt to dictate results and people will do what is required of them to meet the very minimum of expectations in this kind of environment. They will rarely do excellent work. The majority of people want to do good work yet the work structures they find themselves in do not reward good work. When you are competing within an organization to get a raise or a promotion and you have to impress your supervisor you will not share important information with your team members. It is not to your advantage to do this because you are not paid and rewarded to do so.

So how we structure work, pay for work and appraise work has to change. Participative management makes it to people's advantage to share their knowledge because when their team is successful they are successful. The group excels because the criteria for superior performance are being applied and top management sees the benefit of all employees contributing to the organization. They want to acknowledge a resource they already pay for their people.

WHY PARTICIPATIVE MANAGEMENT

Participative management enables organizations to improve performance through a fast, an economical method called the participative design workshop. It clearly states that the design principle underlying the work is a participative method that has clear goals and simple tools for work process improvement.

It can be utilized to improve the structure of the organization or just for work process improvement. This will depend on the needs of the organization. The workshop begins with the assessment phase, which begins with briefing one. Briefing one is a short presentation of the bureaucratic design principles and its inverse relationship to the criteria for superior performance. Participants fill out the criteria for superior performance and the skills assessment matrix. The design phase begins with briefing two which is an introduction to the participative design principle and why it leverages the criteria for superior performance. It explains why organizations perform better using these methods. Groups chart their current work process or work flow and flag areas for improvement. They are given clear boundaries in which to work by management. Next, they design improvements for the areas that are deficient and negotiate with management on what is possible to change within the work process. If

[4]

management wants structure addressed then the group can tackle this issue as well. The workshop gets excellent results even without addressing the issue of organizational structure.

Participative (or participatory) management, otherwise known as employee involvement or participative decision making, encourages the involvement of stakeholders at all levels of an organization in the analysis of problems, development of strategies, and implementation of solutions. Employees are invited to share in the decision-making process of the firm by participating in activities such as setting goals, determining work schedules, and making suggestions. Other forms of participative management include increasing the responsibility of employees (job enrichment); forming self-managed teams, quality circles, or quality-of-work-life committees; and soliciting survey feedback. Participative management, however, involves more than allowing employees to take part in making decisions. It also involves management treating the ideas and suggestions of employees with consideration and respect. The most extensive form of participative management is direct employee ownership of a company.

Four processes influence participation. These processes create employee involvement as they are pushed down to the lowest levels in an organization. The farther down these processes move, the higher the level of involvement by employees. The four processes include:

a Information sharing, which is concerned with keeping employees informed about the economic status of the company.

b. Training, which involves raising the skill levels of employees and offering development opportunities that allow them to apply new skills to make effective decisions regarding the organization as a whole?

c. Employee decision making, which can take many forms, from determining work schedules to deciding on budgets or processes.

d. Rewards, which should be tied to suggestions and ideas as well as performance.

[5]

BENEFITS OF PARTICIPATIVE MANAGEMENT

A participative management style offers various benefits at all levels of the organization. By creating a sense of ownership in the company, participative management instills a sense of pride and motivates employees to increase productivity in order to achieve their goals. Employees who participate in the decisions of the company feel like they are a part of a team with a common goal, and find their sense of self-esteem and creative fulfillment heightened.

Managers who use a participative style find that employees are more receptive to change than in situations in which they have no voice. Changes are implemented more effectively when employees have input and make contributions to decisions. Participation keeps employees informed of upcoming events so they will be aware of potential changes. The organization can then place itself in a proactive mode instead of a reactive one, as managers are able to quickly identify areas of concern and turn to employees for solutions.

Participation helps employees gain a wider view of the organization. Through training, development opportunities, and information sharing, employees can acquire the conceptual skills needed to become effective managers or top executives. It also increases the commitment of employees to the organization and the decisions they make.

Creativity and innovation are two important benefits of participative management. By allowing a diverse group of employees to have input into decisions, the organization benefits from the synergy that comes from a wider choice of options. When all employees, instead of just managers or executives, are given the opportunity to participate, the chances are increased that a valid and unique idea will be suggested.

REQUIREMENTS OF PARTICIPATIVE MANAGEMENT

A common misconception by managers is that participative management involves simply asking employees to participate or make suggestions. Effective programs involve more than just a suggestion box. In order for participative management to work, several issues must be resolved

[6]

and several requirements must be met. First, managers must be willing to relinquish some control to their workers; managers must feel secure in their position in order for participation to be successful. Often managers do not realize that employees' respect for them will increase instead of decrease when they implement a participative management style.

The success of participative management depends on careful planning and a slow, phased approach. Changing employees' ideas about management takes time, as does any successful attempt at a total cultural change from a democratic or autocratic style of management to a participative style. Long-term employees may resist changes, not believing they will last. In order for participation to be effective, managers must be genuine and honest in implementing the program. Many employees will need to consistently see proof that their ideas will be accepted or at least seriously considered. The employees must be able to trust their managers and feel they are respected.

Successful participation requires managers to approach employee involvement with an open mind. They must be open to new ideas and alternatives in order for participative management to work. It is important to remember that although the manager may not agree with every idea or suggestion an employee makes, how those ideas are received is critical to the success of participative management.

Employees must also be willing to participate and share their ideas. Participative management does not work with employees who are passive or simply do not care. Many times employees do not have the skills or information necessary to make good suggestions or decisions. In this case it is important to provide them with information or training so they can make informed choices. Encouragement should be offered in order to accustom employees to the participative approach. One way to help employees engage in the decision-making process is by knowing their individual strengths and capitalizing on them. By guiding employees toward areas in which they are knowledgeable, a manager can help to ensure their success.

Before expecting employees to make valuable contributions, managers should provide them with the criteria that their input must meet. This will aid in discarding ideas or suggestions that cannot be implemented, are not feasible, or are too expensive. Managers should also give

[7]

employees time to think about ideas or alternative decisions. Employees often do not do their most creative thinking on the spot.

Another important element for implementing a successful participative management style is the visible integration of employees' suggestions into the final decision or implementation. Employees need to know that they have made a contribution. Offering employees a choice in the final decision is important because it increases their commitment, motivation, and job satisfaction. Sometimes even just presenting several alternatives and allowing employees to choose from them is as effective as if they thought of the alternatives themselves. If the employees' first choice is not feasible, management might ask for an alternative rather than rejecting the employee input. When an idea or decision is not acceptable, managers should provide an explanation. If management repeatedly strikes down employee ideas without implementing them, employees will begin to distrust management, thus halting participation. The key is to build employee confidence so their ideas and decisions become more creative and sound.

CONCERNS

Participative management is not a magic cure for all that ails an organization. Managers should carefully weigh the pros and the cons before implementing this style of management. Managers must realize that changes will not take effect overnight and will require consistency and patience before employees will begin to see that management is serious about employee involvement. Participative management is probably the most difficult style of management to practice. It is challenging not only for managers but for employees as well.

While it is important that management allows employees to participate in decision making and encourages involvement in the organization's direction, managers must be cognizant of the potential for employees to spend more time formulating suggestions and less time completing their work. Upper-level management will not support a participative management program if they believe employees are not meeting their daily or weekly goals. Some suggestions for overcoming this potential problem are to set aside a particular time each week for workers to meet with management in order to share their ideas or to allow them to work on their ideas

[8]

during less busy times of the day or week. Another idea that works for some managers is to allow employees to set up individual appointments to discuss ideas or suggestions.

Managers should remember that participative management is not always the appropriate way to handle a given situation. Employees often respect a manager that uses his or her authority and makes decisions when it is necessary. There are times when, as a manager, it is important to be in charge, make a decision, and then accept the responsibility for the choices made. For example, participative management is probably not appropriate when disciplinary action is needed.

When managers look upon their own jobs as a privilege instead of as a responsibility, they will fail at making participative management work. They will be less willing to turn over some of the decision-making responsibility to subordinates. Another reason that participative management fails is that managers do not realize it is not the same as delegating or simply shifting responsibility. Participation alone has no value; it is only an effective tool if it is used to solve problems and meet goals. Some managers believe that inviting employees to join in meetings and form committees will create a successful participative management program. However, these measures are only successful when employees' ideas are accepted by management and implemented.

The larger the organization, the more difficult it becomes to institute a participative management style. Large organizations have more layers and levels, which complicate effective communication and make it difficult to register the opinions and suggestions of a diverse group of employees and managers. Critics argue that unions are often more effective than participative management in responding to employee needs because union efforts can cut through bureaucratic organizations more quickly.

Participative management programs can be threatened by office politics. Due to hidden agendas and peer pressure, employees may keep their opinions to themselves and refuse to tell a manager if they feel an idea will not work. Managers also play a part in politics when they implement participative management programs to impress their own bosses but have no intention of seeing them through.

[9]

Many companies have experienced the positive effects of participative management. Employees are more committed and experience more job satisfaction when they are allowed to participate in decision making. Organizations have reported that productivity improved significantly when managers used a participative style. Participative management is not an easy management style to implement. It presents various challenges and does not succeed overnight. Managers will be more successful if they remember that it will take time and careful planning before they will see results. Starting with small projects that encourage and reward participation is one way to get employees to believe that management is sincere and trustworthy.

Participative Management refers to as an open form of management where employees are actively involved in organization’s decision making process. The concept is applied by the managers who understand the importance to human intellect and seek a strong relationship with their employees. They understand that the employees are the facilitators who deal directly with the customers and satisfy their needs. To beat the competition in market and to stay ahead of the competition, this form of management has been adopted by many organizations. They welcome the innovative ideas, concepts and thoughts from the employees and involve them in decision making process.

Participative Management can also be termed as ‘Industrial Democracy’, ‘Co-determination’, ‘Employee Involvement’ as well as ‘Participative Decision Making’. The concept of employee participation in organization’s decision making is not new. However, the idea couldn’t gain that much popularity among organizations. Studies have shown that only 3-5 percent of organizations have actually implemented this concept in their daily operations. Though the theory of participative management is as old as the institution of employees and employers still it is not applied by a large proportion of organizations.

The idea behind employee involvement at every stage of decision making is absolutely straight. Open and honest communication always produces good results both for organization as well as workers. Freedom and transparency in company’s operations take it to the next level and strengthens the basis of the organization. On the other hand, there are several companies that straightway rule out the possibility of participative decision making process. According to them, employees misuse their freedom of expression and participation in decision making as it provides higher status to employees and empowers them.

[10]

ADVANTAGES OF PARTICIPATIVE MANAGEMENT

Undoubtedly participative approach to management increases the stake or ownership of employees. But there is more to it. The following points elucidate the same.

a. Increase in Productivity: An increased say in decision making means that there is a strong feeling of association now. The employee now assumes responsibility and takes charges. There is lesser new or delegation or supervision from the manager. Working hours may get stretched on their own without any compulsion or force from the management. All this leads to increased productivity.

b. Job Satisfaction: In lots or organizations that employ participative management, most of the employees are satisfied with their jobs and the level of satisfaction id very high. This is especially when people see their suggestions and recommendations being implemented or put to practice. Psychologically, this tells the individual employee that, ‘he too has a say in decision making and that he too is an integral component of the organization and not a mere worker’.

c. Motivation: Increased productivity and job satisfaction cannot exist unless there is a high level of motivation in the employee. The vice versa also holds true! Decentralized decision making means that everyone has a say and everyone is important.

d. Improved Quality: Since the inputs or feedback comes from people who are part of the processes at the lowest or execution level. This means that even the minutest details are taken care of and reported. No flaw or loophole goes unreported. Quality control is thus begins and is ensured at the lowest level.

[11]

e. Reduced Costs: There is a lesser need of supervision and more emphasis is laid on widening of skills, self management. This and quality control means that the costs are controlled automatically.

DISADVANTAGES OF PARTICIPATIVE MANAGEMENT

There is a flip side to everything; participative management stands no exception to it. Whereas this style of leadership or decision making leads to better participation of all the employees, there are undoubtedly some disadvantages too.

a. Decision making slows down: Participative management stands for increased participation and when there are many people involved in decision making, the process definitely slows down. Inputs and feedback starts pouring from each side. It takes time to verify the accuracy of measurements which means that decision making will be slowed down.

b. Security Issue: The security issue in participative management also arises from the fact that since early stages too many people are known to lots of facts and information. This information may transform into critical information in the later stages. There is thus a greater apprehension of information being leaked out.

c. It is not appropriate for every organization and every work unit-employees getting involved must be interested, employees must have competence and knowledge, there must be trust and confidence between parties involved.

The advantages seem to outnumber the disadvantages. This however is no assurance that one should blindly adopt it for his/her organization. Organizations are different and therefore the culture, the human resources. A deep understanding of both is required in order to ascertain a decision making style and adopt the same.

[12]

Some Examples of Participative Management & Its Uses

Participative management allows employees to take responsibility, accountability and authority over work done for a company. This leadership strategy typically empowers qualified employees and allows executives to focus on strategic planning while subordinates manage daily operations. Effective leaders establish a clear mission, vision and set of objectives before deferring management to employees. Management communicates the organizational goals, describes what is expected in terms of results and then encourages employees to think creatively to solve problems and figure out how to improve performance. By establishing performance measurement criteria for learning, leaders can use participative management strategies to their advantage.

a. Promoting Learning and Career Development

Using participative management strategies, effective leaders encourage their employees to identify performance gaps and set their own career path using company resources, including formal education, workshops and self-paced courses. Employees use assessment tools to identify their strengths and weaknesses in achieving company goals. Then, they create a development plan and review it with their managers. This enables the employee to create a customized action for improving her skills over the coming year. By empowering the employee to assess her own competency and establish a plan, the leader guides the employee and provides a supportive atmosphere in which to develop the skills necessary to achieve the company's strategic goals.

b. Increasing Employee Satisfaction

When companies find out through employee satisfaction surveys that subordinates feel disgruntled and disillusioned, effective leaders use participative management techniques to get the organization back on track. By running focus groups and personal interviews, effective leaders get input from their subordinates about the true state of the organization. Using this valuable feedback, these leaders realign their strategic objectives.

[13]

c. Improving Processes

Effective leaders reward employees for innovative ideas. Using quality management techniques such as Lean Six Sigma, managers identify opportunities to improve company processes that reduce product errors, eliminate waste and increase customer satisfaction. By involving employees closest to the problems, such as customer service representatives, effective leaders gather data to determine the root cause and fix problems.

c. Valuing Diversity

In global organizations, effective leaders ensure that teams work well together. By running workshops and team-building exercises, these leaders encourage their subordinates to learn about their co-workers, business partners and suppliers. By recognizing that succeeding in a dynamic marketplace requires expertise in dealing with different cultures, customs and traditions, effective leaders foster a collaborative work environment.

Employee Empowerment

Exploring employee empowerment is a management decision based on proven capability and demonstrated trust by the employee. Transformed organizations introduce empowerment over rules and regulations through smart governance and guidelines supporting organizational culture. These practices promote improved customer service through employee decision-making extended by management authority and flexibility. Demonstrating customer-focused programs and practices through skilled and knowledgeable employees with authority and responsibility to move the organization forward in its mission.

Power and Empowerment

By definition and context, power is “possession of control, authority, or influence over others” (Merriam-Webster's Third New International Dictionary Unabridged, 2002). A good manager can have power and influence over others and lead well. The definition of empowerment is “to give authority, to enable, and to promote influence” (Merriam-Webster's Third New

[14]

International Dictionary Unabridged, 2002). The act of empowerment allows a manager to enable individuals to think and act in a way that will enhance their performance, and demonstrate trust in the employee’s abilities. This does not remove power from the manager but instead increases his or her potential to gain power by an effective team.

Methods for Employee Empowerment

Employee empowerment is exclusive to management extending authority to employees for the purpose of granting decision-making authority and responsibility to employees allowing them to contribute to the organization’s mission. Management’s responsibility is to prepare for the organizational change or shift. According to Chiles and Zorn (1995), empowering employees is a dominant piece in developing organizational viewpoints to establish self-directed working groups and quality management.

Supervisors, colleagues, and organizations contribute to a well empowered organization that explores the relationship between the people involved. Positive emotional stimulation and verbal encouragement and are integral to the feeling of empowerment (Chiles & Zorn, 1995). During interviews and surveys conducted in a large company, researchers discovered the connection between the emotional state of empowerment and the employees’ perception about the macro-level culture (Chiles & Zorn, 1995). Good decision-making develops more self-worth, sparks initiative, creativity, and imaginative.

Selecting Empowered Employees

Managers will select qualified candidates who possess a working knowledge of products and production with strong personal and professional leadership qualities. The candidates committed to the organization coupled with the willingness to work beyond the scope of work makes them ideal candidates for empowerment. Empowered employees work in concert with the organizational mission as management recognizes their ability and gains further trust in employee’s capability for sound decision-making and respect for boundaries. Empowered employees are problem solvers and are keen on the organization’s goals as objectives. A manager will choose an empowered employee because he or she takes initiative on projects

[15]

and is capable of providing innovative ideas that can enhance productivity and product improvements. According to Anderson (2011), empowered employees tend to take more responsibility in their work knowing that what they produce effects the success and profitability of the organization. Managers identify empowered employees as assets to the organization and instrumental in achieving successful outcomes. Managers empower employees who they trust to follow specific instructions and effectively communicate organizational protocols. The empowered employee is an intrinsically motivated team builder not afraid to take controlled risks and assume responsibility.

Effects of Employee Empowerment

Employee empowerment can be a very powerful tool for the organization if used properly. It can bring different kinds of benefits to the business. The main benefit of course is the improvement in general performance and efficiency of the business. Implementing empowerment into business becomes more and more popular nowadays, because managers started to understand the power of this system.

The most important goal of any business is to maximize its profit. This can be accomplished in many ways like: minimizing costs, hiring more efficient employees, entering new markets, and also employee empowerment. Employee empowerment is actually very effective and at the same time very cheap way to lower company’s costs. Empowered employees can make decisions without manager’s knowledge. It involves them deeper and deeper into the life of the organization and contributes more to the overall performance. Employee’s suggestions are extremely important in this system. In fact these suggestions make the product or service better, cheaper and more efficient. Alex Blyth in his research among major UK companies points out some interesting facts. He found out that BMW saved £10.5 million in just two years thanks to employees’ suggestions.

“The ideas vary greatly in scope and nature. Screws used to be thrown out, but are now recycled. A report that was printed on A3 paper is now printed on A4, saving thousands of pounds. Halving the number of foam blocks used for soundproofing on the production process saved £115,000 a year without any negative impact. Changing the fixings used below the windscreen saved four pence per car.”

[16]

As we can see the suggestions made by workers were sometimes very simple. Blyth states that around 11,000 ideas were used by BMW last year. There are thousands examples of organizations that benefit just like BMW does from the employee empowerment.

Savings are not the only benefit of the empowerment. The empowerment makes the workplace more friendly and reduces the pressure inside the organization. It also brings certain benefits to employees of an organization. It makes the employees give more inputs to the business as far as enhancement; it endorses higher productivity, and is an excellent balance between their personal and business lives. Empowerment exercises employees’ intellects to find better solutions to issues and increases the employees’ potential for promotions and job satisfaction. It results in personal growth, feelings of confidence and control in their companies. It makes workers exploit their capabilities and it enables them to stand behind their decisions, assume risks, participate and take actions. A trusting atmosphere is created; it is significant for all employees to know not what is being done, but why. They understand their tasks better and make them more personal, because the task identity is created.

Employee empowerment has no negative effects reported whatsoever. It has the potential to make the business better as a whole, bringing only the positives to the organization. It does not expose a company to some extra costs, maybe except the training cost, which eventually will turn into profits anyway. The leadership style can boost efficiency and effectiveness inside an organization. Empowerment does not only affect the employees but the whole structure; it allows managers more time to work on more important business matters. Therefore, managers can benefit from that system as well. Dov Seidman in his BusinessWeek article points out very important facts about empowerment.Interaction between employee and management affects many facets of an organization. One of the most important aspects derived from this interaction is the empowerment of the employee and the effects that the empowerment may have on the employee and organization. Empowered employees usually exhibit characteristics of self-motivation and commitment. Empowered employees also exhibit a sense of responsibility to perform at high levels of effort (Howard & Foster, 1999) with a sense of quality and perfection. The motivation of an empowered employee goes beyond self-efficacy; they buy into the idea that they are an important factor in the organization’s growth and success.

[17]

If done correctly, the effects of employee empowerment will have a positive effect on an organization. However, unsuccessful execution of the empowerment process can negatively affect the empowered employee and the organization. Increased arrogance among employees is one of the most prevalent disadvantages of employee empowerment. Arrogant employees are difficult to deal with, they do not take direction well and can become insubordinate (Robertson & Media, 2010). The employee loses sight of the goal, and starts to abuse the new power and confidence.

The effects of employee empowerment advantages far outweigh the disadvantages for any organization. The very premise of the idea of empowering employees for decision-making is for them to feel like a stakeholder of the organization introducing positive morale and productivity.

Employee Satisfaction Through Empowerment GE Healthcare

GE Healthcare provides transformational medical technologies and services that are shaping a new age of patient care. GE broad expertise across the cardiology care area helps our customers to deliver better care to more people around the world at a lower cost. In addition, GE partner with health care leaders, striving to leverage the global policy change necessary to implement a successful shift to sustainable health care systems.

The “healthymagination” vision for the future invites the world to join GE on its global journey as GE continuously develop innovations focused on reducing costs, increasing access and improving quality and efficiency. Headquartered in the United Kingdom, GE Healthcare is a $17 billion unit of General Electric Company (NYSE: GE). Worldwide, GE Healthcare employs more than 46,000 people committed to serving health care professionals and their patients in more than 100 countries. GE Healthcare’s comprehensive product portfolio provides solutions for all care areas in the field of diagnostic cardiology and patient monitoring.

In this large organization, unwillingly the organization is forced into a mechanistic design of bureaucracy, driven by hierarchal processes and systems of management, both people and technology which unless understood seem to lend itself to the inherent leadership styles by managers disenfranchising employees, and ultimately driving down productivity and employee

[18]

satisfaction. Through identification of the core and root cause of this problem, analysis of supporting literature, profiling a manager’s leadership style and creating recommendations to alleviate if not solve this particular issue within the organization.

PROBLEM STATEMENT

The problem is employee performance and low satisfaction, as a result of disenfranchised employees due to of the ever changing management structure and organizational priorities which are trickled down through the ranks of the executive, then managerial, and finally employee goals and objectives for each calendar year, affecting employee performance and satisfaction. The problem is systemic from top to bottom, which in a mechanistic design lends to process and policy driven decisions, and the mentality of employees just doing what they are told, because that is what they have been told to do.

Focusing on the employee performance problem, sometimes these cannot be measured, and therefore difficult to diagnose, identify, document, and create plans to increase that performance level. The disenfranchised employee tends to not volunteer for any short term, incidental, or easily completed tasks presented by a manager to a one time situation that if addressed would head off any longer term issues.

Employee satisfaction, evaluated through different anonymous and not anonymous (interview) processes and surveys had been a tried and true way for this organization to gauge satisfaction, and create the action plans to combat them.

Through this analysis, one GE Healthcare’s manager style will be evaluated, and determined as to their individual impact on how they, based on style impact performance and employee satisfaction using motivation theory and empowerment techniques in coaching and leading by constructive leadership styles. The analysis will conclude whether or not one manager’s style of leadership can have an impact on the perceived negative trickle down of managerial changes and continuously changing goals and organizational objectives. Further, solutions, both proposed and already implemented will lend to the supported evaluations and analysis.

[19]

LITERATURE REVIEW

Organizations require a number of resources, strategies and techniques in order to succeed. From capital, to a business site and to employees, all of these are essential for a business to work. While these components are significant, values, particularly motivation, is also recognized as a vital business element, especially in enabling organizational transformation and enhancement. Motivation permits the business owners and employees to be resourceful, responsible and productive in performing daily business tasks, which in turn helps in uniting the business with its consumers. By means of motivating the employees, managers are able to encourage them to work towards a common goal. Sometimes this common goal changes without notice, due to a change in leadership and executive management. This can greatly impact the employee’s productivity and satisfaction of the projects and objectives they seek to attain each year. Motivation, empowerment and a sense of ownership over priorities and projects employees are involved in also helps the employees to become more productive, enabling enhancement and transformation to place.

According to Creech (1995), motivation is typically defined by psychologists as a stimulation that causes the creation of aroused, sustained and directed behavior. This behavior in turn leads individuals to work and perform towards goal achievement. Several authors had also studied on the principal concept behind motivation. Kreitner (1995) for instance, has defined motivation as the psychological process that results to a directional and purposeful behavior. Motivation is also defined as the tendency to behave in an appropriate manner to attain certain needs (Buford, Bedeian & Lindner, 1995).

The introduction of several researches on employee motivation has also introduced a number of theories explaining the factors that motivate employees. These theories include the need-hierarchy theory and the two-factor theory. The need-hierarchy theory of Maslow (1943) is among the first motivation theories that had been introduced. In this theoretical model, Maslow noted five levels of employee needs, which include the physiological, social, ego, safety and self-actualizing needs. From his work, Maslow is a challenging process and that motivation basically works through a series of needs that are arranged in a certain level. Hersberg on the other hand (Hersberg, Mausner & Snyderman, 1959) had classified motivation into two factors. These two factors are motivators and hygienes. Intrinsic or motivator factors pertain to recognition, achievement and attainment of job satisfaction. Alternatively, extrinsic or hygiene factors refer to job security and payments propagating performance.

[20]

Based from these theoretical perspectives, it is clear that employees would have to receive something in return in order to encourage them to work productively towards transformation and enhancement. There are many specific ways on how the theories of motivation can be applied in actual work settings. Granting due promotion is one example. Benham (1993) stated that promotion is also synonymous to career success where employees are given higher responsibilities or place on higher authority levels. Promotion is considered an important element of human resource management as it encourages employees to perform with quality. This also represents a significant aspect of the internal selection system. The organizational members’ affective reactions towards their job and to the company are also influenced significantly based on their promotional opportunities (Johnston et al., 1993). As explained by the theories of Maslow and Hersberg, motivation can help in drawing out the best each employee can provide; this can be achieved by promotion. Evaluating the goals and objectives of the organization, evaluating promotional activity, and rewarding those who perform at a high level increases performance and satisfaction.

Another means of applying the theories of motivation is through the employment of coaching, a role which managers themselves can play. Similar to sports, a business coach helps in making the business grow and succeed by systematically making the goals and objectives of the organization equivocal to employee’s personal and professional goals. Through projects which make the organization thrive will coaching be successful. The business coach is one who serves as the mentor, counselor and tutor of an organization. They are very much related to motivations theories as they act as inspirations for the employees to improve and remain challenged (Halle, 1999). According to Nyman and Thach (2002), business coaching can be done through holistic coaching, performance coaching, and content coaching or through manager as coach. Furthermore, the process can be done in various setting such as one-on-one coaching, focus group coaching or organizational coaching.

Halle (1999) noted that business coaching has a number of significant purposes in the organization, particularly in relation to transformation and enhancing the employee experience increasing performance and job satisfaction. For instance, this technique helps in motivating the employees, especially when problems or issues arise. Through managerial coaching, the essence of teamwork is emphasized. Moreover, by providing polite criticisms to the employees, they are able to realize their weak points, resulting to developed and more efficient workers.

[21]

The ability of managerial coaching and constructive behavioral managing techniques guide the employees also helps in bringing about transformation in their working skills and performance; this transformation occurs as managers stimulate the workers to search for new skills and methods that would help them cope with various business challenges, including changing executive management changes in business objectives. Coaching also helps in identifying the strong points of the workers and assist in enhancing them further. It also relates to the enhancement factor as it utilizes the concept of constant evaluation. By monitoring both the strengths and weaknesses of the employees, managerial coaching is able to send in the right feedbacks to each employee, which would allow for continuous enhancement in their skills and work attitudes (Halle, 1999).

ANALYSIS

Changes in upper management affect the organizations leadership team, and priorities for direction of projects. The trickled down of goals and objectives has negatively perceived effects on the team’s performance. In this organization, approximately every 6 to 8 months, major announcements are made to changes in executive management staff, and soon to follow are their appointments to various areas of the business. Within the first few weeks of new appointments, new executives start conducting explorations of their business. Meetings held with leadership in areas of engineering, service, sales, manufacturing, and human resources. It is then within a few week new goals, objectives, priorities and directives start to be distributed, and slowly but surely trickle down to the line, customer facing employee, which includes me and other colleagues.

Dissatisfaction is demonstrated in each of these cycles of new leadership and executive appointment through eNPS (employee Net Promoter Scoring). This is a survey which is sent to all employees, and asks pointed questions about leadership, satisfaction and most importantly the question “would you recommend your employer to a friend or family member?” (GE Healthcare eNPS, 2010) The question is mostly focused upon. The other key questions on this survey drill into managerial performance, addressing various processes which employees are typically unhappy. Some of these processes are on goals and objective guiding the projects that employees must complete each year for evaluations and rankings in among their team mates, ultimately translating into salary action. Executive managers and leaders directing the changes and priorities for the downstream teams impact the acceptance of the changes based on the leadership styles demonstrated by said leaders. Recent demonstrations by new executive

[22]

leadership as show an aggressive style of leadership. According to Human Synergistic International the executives demonstrate a high need for power, status, prestige, influence and control. Their directives are non-negotiable, and are usually followed up by statements of their position, showing their prestige in the organization. Narrow rigid thinking and a tendency to be threatened by perceived attempts to undermine authority causing the executives to drive down more rigid goals and objectives, that if are not followed have consequence (2010). Through another tool used to gather employee perceptions, rate satisfaction and determine performance ratings, the eGEOS (electronic GE Operating Survey) allows employees to identify issues and inefficiencies within their immediate organizations. The 2010 survey revealed employees not satisfied with adequacy of equipment to perform job, loosing productivity, also response from management on customer issues not being addressed (GE Healthcare, 2010).

SOLUTIONS

Three solutions identified will, with commitment, diligence, and perseverance potentially raise the level performance among this team in the organization, and increase satisfaction. Through a constructive style of leadership, the solutions presented for this particular problem

First of all, identifying all of the current projects, goals and objectives in the organization, breaking them down into team of priorities then, leveraging accomplished progress and work to motivate employees to complete and gain sense of accomplishment and contribution to the organization. The good idea here is taking the existing set up priorities and projects, and simply leveraging for the local team, not necessarily the greater organization. The pro is employees finish projects, and whether or not valuable to the bigger organization, the immediate manager and employees benefit from a completed vs. uncompleted project or goal given to them. Not having someone left hanging.

Secondly, control change on a local leadership level, keeping consistence priority changes to a minimum, leveraging constructive leadership styles to motivate and create a WIN-WIN environment. The pro of this approach is the least amount of change among projects and priorities among employees, keeping the momentum going. The negative for this approach is keeping the what-are-now old projects and priorities around do not contribute to the business, or upper management.

[23]

Lastly, encourage employees to stand-up, advising leadership of performance and job satisfaction through employee survey, and round table discussions. The pros of this approach is there could be anonymous feedback through a survey, but since these survey’s already exist, and the perception is the do not make any positive changes; there is no use for them to continue. A preconceived notion of a program not taken seriously by senior leadership is sure to fail. The consequence of this approach is the perceived back-lash after a round-table or open forum on the individual themselves.

Of the three presented solutions, a balanced combination of options 1 and 2 is the most motivational, and practical for the immediate team. Organizational priorities can generally be grouped into three categories; Revenue, Customers, and Employees. No matter how you slice or dice a company’s mission, goals, objectives, priorities, and the core of this is the three I mention.

ACTION PLAN

In order to implement the second option effectively, and gain momentum to increase employee performance and satisfaction the following actions to be taken:

a. Meetings with each subordinate. This will provide the employee a face to face conversation to discuss their own projects, priorities, and passions related to the goals and objects which spawned projects.

b. Collect data (project ID, project type, project description, percent completed, individual vs. group involvement) on current projects related to goals and objectives set both by the business and by the individual and manager.

c. Discuss each project in a prioritization according to employee, supervisor, and business directives (new or current). Giving the employees a stake in importance of their current projects will increase their productivity in completing those projects.

[24]

d. Identify risks and benefits to completing current projects vs. shelving, and starting a new set of project priorities. Brining the realities to light about each project will increase satisfaction of completing the projects, not just completing for the sake of finishing where no benefit or change comes from the project in the organization.

e. Overlay new organizational leadership goals and objectives, projects that fit into those projects, and finally determine which projects, based on the goals and objectives from both previous and new leadership meet the business needs, and also continue the work of high priority and involved projects for the employee. Projects can be then completed with a higher rate of performance and meeting standards, while not disenfranchising employees and lowering satisfaction.

f. Recognize employees for completed goals and objectives, both for a past leadership set of directions, as well as new leadership priorities with both monetary and public recognitions to immediate team and leadership including executive management.

REFLECTION

One manager can have an impact on how employees perform and raise their satisfaction. Throughout this paper, the research, and development of the analysis, and consideration of the solutions positively influenced my professional building of managerial skills. While I am not a manager, I hope to be one day. I see through this analysis the struggles, based on one manager’s own leadership style, how they can have impact, even if the hierarchal organization pulls in the opposite direction. Having done this assignment will help me take a look and step back when I am faced with dissatisfied employees and low performance levels, and better implement solutions that are meaningful and prosperous.

Personally, the same can applied to friends, family, and social situations, where others around are not satisfied and or do not provide positive influence into my life. Organizational behavior, while in theory is modeled for companies, informal, which includes social, academic, and other

[25]

not formalized entities can benefit from its research and development of practices to produce positive outcomes professionally, academically, and personally.

CONCLUSION

Participative management holds employees responsible, accountable, for their work. It allows them to determine the out-come of work-related activities. Participative management affords employees a voice. Employees take their jobs seriously, and become loyal to the organization. Participative management delegates control to employees, but the organizational goals must be adhered to. Participative management fosters a team environment. It is management’s job to explain what's expected, and work with employees to achieve goal. Empowerment is management extending and granting their decision-making authority and responsibility to select employees. Not every empowered employee has the same degree of responsibility. Management selectively chooses and determines who, what, when, where, and how to empower under their purview. Empowerment of employees include their willingness to accept delegation of authority, maintain training and development, have sound judgment, and experience to make management-decisions for matters pertaining to organizational mission as a stakeholder.

[26]

Bibliography

* Anderson, A. (2011). Principle of Employee Empowerment & Its Advantages. Retrieved from http://smallbusiness.chron.com/principle-employee-empowerment-its-advantages-1844.html

* Chiles, A. M., & Zorn, T. E. (1995, February). Empowerment in organizations: Employees' perceptions of the influence on empowerment. Journal of Applied Communication Research, 23(1), 1-25. University of Phoenix library Communication & Mass Media Complete database.

* French, W., & Bell, C., Jr., (1990). Organization development: Behavioral science interventions for organization improvement (4th ed), Prentice-Hall, Englewood Cliffs, NJ.

* Merriam-Webster's Third New International Dictionary Unabridged. (2002). Springfield, MA: Merriam-Webster Inc

* Devis,K. 1963. The Case for Participative Management. Buslness Horizon, 6, pp.55-60.

* Chandra ,M. 1977. Workers' Participation in Management. Productivity, 18(1), p.99.

* Lorne C. Plunkett, Robert Fournier .1991. Participative Management: Implementing Empowerment

* http://www.netmba.com/mgmt/ob/motivation/mcgregor/.

[27]