2.

1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource

Management
Human​ ​Resource​ ​Planning
Human​ ​resource​ ​planing​ ​(workforce​ ​planning)
Human​ ​Resource​ ​Management:​ ​The​ ​management​ ​function​ ​of​ ​using​ ​and​ ​developing​ ​people​ ​within​ ​a
business​ ​to​ ​meet​ ​its​ ​organizational​ ​objectives.
★ Workforce​ ​planning

★ Recruitment,​ ​selection,​ ​and​ ​induction​ ​of​ ​new​ ​employees

★ Training​ ​and​ ​development​ ​of​ ​staff

★ Performance​ ​management​ ​and​ ​staff​ ​appraisals

★ Reviewing​ ​pay​ ​and​ ​remuneration​ ​packages

★ Disciplinary​ ​and​ ​grievance​ ​procedures

★ Looking​ ​after​ ​the​ ​welfare​ ​of​ ​employees

People​ ​add​ ​value​ ​to​ ​an​ ​organization’s​ ​output

increasing​ ​productivity,​ ​improving​ ​quality,​ ​coming​ ​up​ ​with​ ​new​ ​ideas,​ ​better​ ​customer​ ​service

Human​ ​Resources​ ​Planning:​ ​The​ ​management​ ​processes​ ​of​ ​anticipating​ ​and​ ​meeting​ ​an​ ​organization’s
current​ ​and​ ​future​ ​staffing​ ​needs.

Short​ ​Term:​ ​existing​ ​upcoming​ ​demands​ ​of​ ​an​ ​organization.

​ ​Ex.​ ​hiring​ ​staff​ ​to​ ​cover​ ​those​ ​who​ ​are​ ​about​ ​to​ ​go​ ​on​ ​maternity​ ​leave/retire

Long​ ​Term:​ ​needs​ ​of​ ​a​ ​business​ ​in​ ​the​ ​foreseeable​ ​future
Ex.​ ​Disney​ ​hiring​ ​and​ ​training​ ​staff​ ​two​ ​years​ ​before​ ​the​ ​opening​ ​of​ ​HK​ ​Disneyland

Can​ ​be​ ​achieved​ ​by​ ​looking​ ​at

→​ ​Historical​ ​data​ ​and​ ​trends
→​ ​Sales​ ​and​ ​income​ ​levels
→​ ​Labour​ ​turnover​ ​rates
→​ ​Flexibility​ ​and​ ​workload​ ​of​ ​staff
→​ ​Demographic​ ​changes

Costs​ ​a​ ​lot​ ​of​ ​time​ ​&​ ​money,​ ​sometimes​ ​you​ ​can’t​ ​predict​ ​upcoming​ ​changes.

Labour​ ​Turnover
Labour​ ​Turnover:​ ​Measures​ ​the​ ​percentage​ ​of​ ​the​ ​workforce​ ​that​ ​leaves​ ​the​ ​organization​ ​in​ ​a​ ​given​ ​time
period,​ ​usually​ ​one​ ​year.

N umber of Staf f Leaving

Labour​ ​Turnover:​ ​ T otal N umber of Staf f x​ ​100
Firms​ ​with​ ​higher​ ​numbers​ ​of​ ​part-time/temporary​ ​workers​ ​have​ ​higher​ ​labour​ ​turnover

Reasons​ ​why​ ​people​ ​leave​ ​their​ ​job:

C​hallenge
L​ocation
A​dvancement
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
M​oney
P​ride
S​ ​(job)​ ​security

Low​ ​labour​ ​turnover​ ​rates​ ​→​ ​managers​ ​have​ ​recruited​ ​the​ ​right​ ​people​ ​for​ ​the​ ​right​ ​job​ ​and​ ​employees​ ​are
content​ ​and​ ​motivated​ ​ ​-​ ​firms​ ​in​ ​this​ ​situation​ ​generally​ ​offer​ ​training​ ​and​ ​professional​ ​development

High​ ​labour​ ​turnover​ ​rates​ ​→​ ​adds​ ​to​ ​cost​ ​of​ ​recruiting,​ ​lost​ ​productivity,​ ​lack​ ​of​ ​continuity

Internal​ ​and​ ​External​ ​Factors​ ​That​ ​Influence​ ​Human​ ​Resources​ ​Planning

Internal​ ​and​ ​external​ ​factors​ ​influence​ ​human​ ​resource​ ​planning​ ​-​ ​demographic​ ​change,​ ​change​ ​in​ ​labour
mobility,​ ​new​ ​communication​ ​technologies.

Demographic​ ​Change
Demography:​ ​Statistical​ ​study​ ​of​ ​population​ ​characteristics​ ​and​ ​trends.​ ​Business​ ​need​ ​to​ ​understand​ ​these
changes​ ​so​ ​they​ ​can​ ​respond​ ​appropriately.

Demographic​ ​change​ ​is​ ​caused​ ​by:

★ Net​ ​Birth​ ​Rate:​​ ​the​ ​difference​ ​between​ ​the​ ​number​ ​of​ ​births​ ​and​ ​deaths​ ​per​ ​period​ ​of​ ​time.​ ​High
NBR​ ​Long​ ​term​ ​→​ ​Larger​ ​supply​ ​of​ ​human​ ​resources
★ Net​ ​Migration​ ​Rate:​​ ​the​ ​difference​ ​between​ ​the​ ​number​ ​of​ ​immigrants​ ​and​ ​emigrants.​ ​If​ ​positive​ ​→
supply​ ​of​ ​human​ ​resources​ ​increase
★ Retirement​ ​Age:​ ​Legal​ ​age​ ​where​ ​people​ ​can​ ​stop​ ​working​ ​and​ ​claim​ ​money​ ​from​ ​their​ ​pensions.​ ​If
retirement​ ​age​ ​is​ ​raised​ ​→​ ​increases​ ​number​ ​of​ ​people​ ​in​ ​the​ ​labour​ ​force.
★ Women:​ ​Entering​ ​or​ ​returning​ ​to​ ​the​ ​workforce​ ​boosts​ ​the​ ​supply​ ​of​ ​human​ ​resources.​ ​Increase​ ​in
number​ ​of​ ​women​ ​working​ ​part-time​ ​→​ ​increases​ ​flexible​ ​working​ ​hours

Longevity​ ​+​ ​decreasing​ ​birth​ ​rate​ ​(ageing​ ​population)​ ​=

Increased​ ​dependent​ ​population​ ​-​ ​adds​ ​pressure​ ​to​ ​taxpayers

Reduced​ ​labour​ ​mobility​ ​-​ ​older​ ​workers​ ​are​ ​less​ ​flexible​ ​than​ ​young​ ​workers​ ​(families​ ​etc)

Changes​ ​in​ ​consumption​ ​patterns-​ ​different​ ​age​ ​groups​ ​have​ ​different​ ​spending​ ​patterns,​ ​opens​ ​up
new​ ​markets​ ​and​ ​provides​ ​opportunities.

Change​ ​in​ ​employment​ ​patterns-​ ​More​ ​people​ ​going​ ​to​ ​university→​ ​more​ ​entering​ ​workforce​ ​at​ ​a
later​ ​age​ ​→​ ​firms​ ​more​ ​likely​ ​to​ ​retain​ ​staff​ ​beyond​ ​their​ ​retirement​ ​age

Changes​ ​in​ ​Labour​ ​Mobility

HR​ ​-​ ​Workforce​ ​Plan

Recruitment:​ ​How​ ​the​ ​business​ ​recruits​ ​the​ ​right​ ​person​ ​for​ ​the​ ​right​ ​job
Training:​ ​How​ ​the​ ​business​ ​ensures​ ​that​ ​employees​ ​receive​ ​proper​ ​professional​ ​development,
weather​ ​initial​ ​training​ ​or​ ​ongoing​ ​professional​ ​development
Appraisal:​ ​How​ ​the​ ​employee's​ ​job​ ​performance​ ​is​ ​evaluated
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
Termination/Dismissal:​ ​How​ ​the​ ​business​ ​manages​ ​the​ ​situation​ ​when​ ​the​ ​employee​ ​leaves,
whether​ ​voluntarily,​ ​or​ ​involuntarily

The​ ​process​ ​of​ ​Recruitment

Common​ ​steps​ ​in​ ​the​ ​process​ ​of​ ​recruitment
Who​ ​do​ ​we​ ​want/​ ​did​ ​we​ ​select​ ​the​ ​right​ ​person?

1-​ ​Conduct​ ​a​ ​job​ ​analysis​ ​:​ ​process​ ​of​ ​analyzing​ ​what​ ​the​ ​job​ ​does​ ​and​ ​what​ ​skills,​ ​qualifications,​ ​and​ ​qualities
do​ ​they​ ​need​ ​to​ ​have

2-​ ​Produce​ ​a​ ​job​ ​description:​ ​Consult​ ​people​ ​who​ ​do​ ​the​ ​job,​ ​managers,​ ​people​ ​the​ ​person​ ​will​ ​interact​ ​with.
Want​ ​to​ ​be​ ​specific​ ​so​ ​not​ ​too​ ​many​ ​candidates
Title/​ ​Job​ ​Classification
Qualifications
Tasks/​ ​Responsibilities
Work​ ​expectations​ ​(hours​ ​/​ ​other​ ​responsibilities)
Other​ ​Qualities

3-​ ​Advertise​ ​vacancy:​ ​generally​ ​online​ ​nowadays​ ​or​ ​in​ ​papers

4-​ ​Screen​ ​applications​ ​and​ ​shortlist​ ​candidates

5-​ ​Interview​ ​candidates

6-​ ​Complete​ ​aptitude​ ​testing​ ​(optional)

7-​ ​Check​ ​references

8-​ ​Offer​ ​job​ ​(written​ ​offer​ ​on​ ​table​ ​for​ ​candidate)

9-​ ​Finalise​ ​contracts

10-​ ​Introductions​ ​of​ ​new​ ​employees

Internal​ ​Recruitment
Advantages Disadvantages

➢ Easier​ ​to​ ​assess​ ​applicants​ ​since​ ​more
information​ ​is​ ​available
➢ Less​ ​costly​ ​and​ ​quicker​ ​than​ ​an​ ​external​ ​search
➢ ​ ​Promoted​ ​employee​ ​is​ ​already​ ​familiar​ ​with
organization​ ​policies,​ ​culture,​ ​etc.
➢ Signals​ ​to​ ​employees​ ​that​ ​career​ ​opportunities
exist​ ​in​ ​organization
➢ Improve​ ​employee​ ​morale​ ​and​ ​organizational
loyalty
➢ ​ ​ ​Less​ ​likely​ ​to​ ​make​ ​major​ ​changes​ ​and​ ​“upset
the​ ​apple​ ​cart”
➢ Narrowing​ ​of​ ​thinking​ ​and​ ​stale​ ​ideas
➢ May​ ​not​ ​help​ ​turn​ ​company​ ​around
➢ Training​ ​will​ ​be​ ​needed
➢ Internal​ ​politics​ ​will​ ​occur​ ​(e.g.,​ ​possible
discontent​ ​of​ ​rejected​ ​applicants;​ ​new
subordinates​ ​discount​ ​new​ ​boss’​ ​knowledge
and​ ​expect​ ​special​ ​treatment;​ ​etc.)
➢ Difficult​ ​to​ ​do​ ​with​ ​rapid​ ​growth
➢ Affirmative​ ​action​ ​goals​ ​may​ ​be​ ​more​ ​difficult
to​ ​achieve
➢ Ripple​ ​effect
➢ Smaller​ ​talent​ ​pool​ ​/​ ​fewer​ ​applicants
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
External​ ​Recruitment
Advantages Disadvantages

➢ Provides​ ​new​ ​ideas​ ​/​ ​fresh​ ​perspectives
➢ May​ ​bring​ ​new​ ​insights​ ​from​ ​other​ ​industries
➢ Initiate​ ​a​ ​turnaround
➢ Hiring​ ​experienced​ ​employee​ ​can​ ​reduce
training​ ​needed
➢ Internal​ ​politics​ ​may​ ​be​ ​avoided​ ​(e.g.,​ ​less
upsetting​ ​to​ ​present​ ​organizational​ ​hierarchy)
Allows​ ​rapid​ ​growth
➢ Increase​ ​diversity
➢ ​ ​Bigger​ ​talent​ ​pool​ ​/​ ​more​ ​applicants
➢ Less​ ​information​ ​available​ ​on​ ​applicants
➢ ​ ​Search​ ​takes​ ​longer​ ​and​ ​costs​ ​more
➢ ​ ​Outsider​ ​takes​ ​time​ ​to​ ​become​ ​familiar​ ​with
current​ ​systems​ ​and​ ​organization​ ​culture
➢ Destroys​ ​incentive​ ​of​ ​present​ ​employees​ ​to
strive​ ​for​ ​promotion
➢ Can​ ​hurt​ ​employee​ ​morale​ ​and​ ​loyalty
➢ Current​ ​organization​ ​members​ ​may​ ​fight​ ​new
ideas

Training
The​ ​following​ ​types​ ​of​ ​training:​ ​ ​on​ ​the​ ​job​ ​(including​ ​induction​ ​and​ ​mentoring),​ ​ ​off​ ​the​ ​job,​ ​cognitive,
behavioural

Training:
- Providing​ ​workers​ ​with​ ​opportunities​ ​to​ ​develop​ ​employment​ ​related​ ​skills
For​ ​current​ ​job​ ​or​ ​future​ ​roles
- Some​ ​jobs​ ​require​ ​continuous​ ​training​ ​and​ ​development
- Some​ ​have​ ​mandatory​ ​training​ ​requirements

Costs​ ​money​ ​because​ ​time​ ​lost​ ​→​ ​should​ ​always​ ​result​ ​in​ ​gap​ ​in​ ​skills​ ​sufficiently​ ​filled

Benefits​ ​of​ ​Training

★ Increased​ ​skill​ ​leads​ ​to​ ​improved​ ​performance

★ Improved​ ​competence​ ​leading​ ​to​ ​decreased​ ​wastage/rework

★ Higher​ ​morale

★ Improved​ ​reputation​ ​as​ ​an​ ​employer​ ​of​ ​choice

★ Can​ ​facilitate​ ​change​ ​in​ ​a​ ​dynamic​ ​organisation

Types​ ​of​ ​Training

Induction Training​ ​that​ ​focuses​ ​on​ ​making​ ​a​ ​new​ ​employee's​ ​familiar​ ​with​ ​the​ ​way​ ​a​ ​business
functions​ ​(policies,​ ​workplace​ ​layout​ ​&​ ​meet​ ​key​ ​staff).

Advantages Disadvantages

Cheap Time​ ​consuming

Makes​ ​people​ ​feel​ ​welcome​ ​and Unproductive
comfortable Some​ ​what​ ​costly

On-the-job Where​ ​employees​ ​are​ ​trained​ ​will​ ​doing​ ​their​ ​normal​ ​job.​ ​Occurs​ ​through​ ​mentoring
with​ ​an​ ​experienced​ ​employee.​ ​Activities​ ​learnt​ ​through​ ​observation​ ​and​ ​practice.
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
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Advantages Disadvantages

Being​ ​taught​ ​by​ ​someone​ ​who​ ​is​ ​an Takes​ ​up​ ​time​ ​of​ ​new​ ​person​ ​and​ ​person
expert​ ​in​ ​that​ ​task who’s​ ​helping​ ​them​ ​→​ ​costly
First​ ​hand​ ​experience Person​ ​may​ ​not​ ​be​ ​qualified​ ​as​ ​a​ ​trainer
Embarrassing

Off-the-job Where​ ​an​ ​employee​ ​is​ ​given​ ​time​ ​off​ ​work​ ​to​ ​attend​ ​training​ ​away​ ​from​ ​the​ ​job.
Training​ ​includes​ ​workshops,​ ​conferences,​ ​courses​ ​by​ ​consultants,​ ​agencies,​ ​or
educational​ ​institutions.​ ​Used​ ​for​ ​soft​ ​skills​ ​not​ ​hard​ ​skills.

Advantages Disadvantages

Formal​ ​and​ ​structured Very​ ​costly

Conducted​ ​in​ ​a​ ​different​ ​location​ ​so Paying​ ​external​ ​business​ ​to​ ​design
people​ ​are​ ​less​ ​distracted training
Potentially​ ​paying​ ​for​ ​transport
Can​ ​be​ ​customised​ ​to​ ​your​ ​business

Cognitive​ ​Training Not​ ​focused​ ​on​ ​a​ ​particular​ ​aspect​ ​of​ ​the​ ​business,​ ​but​ ​rather​ ​develops
thinking​ ​and​ ​processing​ ​skills.​ ​With​ ​better​ ​thinking​ ​and​ ​processing​ ​skills
employees​ ​can​ ​make​ ​quicker​ ​and​ ​more​ ​effective​ ​decisions.

Behavioural​ ​Training
Not​ ​focused​ ​on​ ​a​ ​particular​ ​aspect​ ​of​ ​the​ ​business,​ ​but​ ​rather​ ​develops
interpersonal​ ​skills​ ​(working​ ​with​ ​others)​ ​and​ ​intrapersonal​ ​skills​ ​(dealing
with​ ​emotions).​ ​Useful​ ​for​ ​employees​ ​working​ ​in​ ​project​ ​teams​ ​and
positions​ ​of​ ​leadership​ ​by​ ​concentrating​ ​on​ ​emotional​ ​intelligence​ ​/​ ​stress
management.

Appraisal
The​ ​following​ ​types​ ​of​ ​appraisal:​ ​ ​formative,​ ​ ​summative,​ ​ ​360-degree​ ​feedback,​ ​ ​self-appraisal
Appraisal:​ ​Occurs​ ​when​ ​the​ ​performance​ ​of​ ​an​ ​employee​ ​is​ ​reviewed.​ ​Appraisal​ ​is​ ​different​ ​from​ ​more
traditional​ ​inspection​ ​as​ ​communication​ ​is​ ​two​ ​way​ ​and​ ​feedback​ ​is​ ​constructive.

Benefits​ ​For​ ​a​ ​Employee ​ ​ ​ ​ ​Benefits​ ​For​ ​a​ ​business

❖ Be​ ​motivating
❖ Be​ ​instructive​ ​-​ ​learn​ ​from​ ​past​ ​mistakes
❖ Help​ ​employees​ ​progress​ ​along​ ​their​ ​career
paths
❖ Leas​ ​to​ ​change​ ​in​ ​career​ ​direction
Good​ ​appraisal​ ​systems
→​ ​Are​ ​not​ ​directly​ ​linked​ ​to​ ​pay​ ​or​ ​promotion
❖ Act​ ​as​ ​a​ ​check​ ​on​ ​performance
❖ Help​ ​to​ ​review​ ​new​ ​initiatives
❖ Be​ ​useful​ ​to​ ​record​ ​and​ ​document
performance
❖ Be​ ​motivating​ ​as​ ​it​ ​formally​ ​recognizes
good​ ​performance.
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
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→​ ​Appraisal​ ​systems​ ​are​ ​separate​ ​from​ ​disciplinary​ ​systems
→​ ​Good​ ​appraisal​ ​systems​ ​require​ ​minimal​ ​paperwork
→​ ​Appraisals​ ​provide​ ​an​ ​honest​ ​exchange​ ​of​ ​views

Types​ ​of​ ​Appraisal

Formative Continuous​ ​approach​ ​to​ ​evaluate​ ​performance​ ​during​ ​an​ ​employee’s​ ​time​ ​at
work.​ ​Typically​ ​completed​ ​on​ ​a​ ​one​ ​to​ ​three​ ​year​ ​cycle.​ ​Giving​ ​employees
feedback​ ​when​ ​they​ ​have​ ​done​ ​well​ ​and​ ​in​ ​areas​ ​where​ ​they​ ​have​ ​had
difficulties.

Summative Measures​ ​an​ ​employee’s​ ​performance​ ​according​ ​to​ ​set​ ​standards.​ ​Element​ ​of
making​ ​a​ ​judgment​ ​of​ ​whether​ ​the​ ​employee​ ​passed​ ​or​ ​failed.​ ​Test​ ​knowledge
and​ ​skills​ ​against​ ​clear​ ​and​ ​explicit​ ​markers.​ ​Usually​ ​conducted​ ​at​ ​the​ ​end​ ​of​ ​a
project,​ ​a​ ​contract,​ ​or​ ​a​ ​specific​ ​goal​ ​.

360-​ ​Feedback Provides​ ​employees​ ​with​ ​feedback​ ​from

4-8​ ​co-workers,​ ​subordinates,​ ​line
managers,​ ​and​ ​even​ ​clientele.​ ​Often​ ​used
with​ ​CEO’s​ ​and​ ​other​ ​executives​ ​who​ ​serve
and​ ​interact​ ​directly​ ​with​ ​several​ ​groups​ ​of
stakeholders.

Self-Appraisal Can​ ​be​ ​apart​ ​of​ ​processes​ ​outlined​ ​above​ ​or​ ​done​ ​individually.​ ​Individuals
reflect​ ​on​ ​their​ ​own​ ​performance​ ​by​ ​rating​ ​himself​ ​against​ ​various​ ​performance
indicators.​ ​Employees​ ​can​ ​also​ ​suggest​ ​their​ ​training​ ​needs​ ​and​ ​discuss
accomplishments,​ ​strengths,​ ​weaknesses,​ ​and​ ​potential​ ​problems.

Termination,​ ​Dismissal,​ ​and​ ​Redundancy

Common​ ​steps​ ​in​ ​the​ ​processes​ ​of​ ​dismissal​ ​and​ ​redundancy

People​ ​leave​ ​a​ ​business​ ​due​ ​to​ ​a​ ​variety​ ​of​ ​reasons​ ​such​ ​as;
● Employee​ ​chooses​ ​to​ ​leave
● Business​ ​decides​ ​and​ ​employee​ ​should​ ​no​ ​longer​ ​work​ ​there
● Both​ ​the​ ​employer​ ​and​ ​the​ ​employee​ ​agree​ ​that​ ​separation​ ​is​ ​in​ ​the​ ​best​ ​interest​ ​of​ ​both​ ​parties.

Termination​ ​of​ ​business​ ​relationship​ ​doesn’t​ ​happen​ ​often​ ​as

- ​ ​employees​ ​develop​ ​more​ ​skills​ ​and​ ​experience,​ ​the​ ​cost​ ​of​ ​replacing​ ​them​ ​increases
- Business​ ​prefer​ ​redeployment​ ​or​ ​reducing​ ​hours​ ​strategies
- Employees​ ​have​ ​rights,​ ​and​ ​breaching​ ​a​ ​contract​ ​can​ ​lead​ ​to​ ​legal​ ​action

Termination:​ ​Employees​ ​can​ ​terminate​ ​-​ ​leave​ ​a​ ​business​ ​-​ ​at​ ​the​ ​end​ ​of​ ​their​ ​contract​ ​for​ ​a​ ​many​ ​reasons
- Change​ ​of​ ​career
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
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- Professional​ ​development
- Promotion
- Retirement
- Lifestyle​ ​choice
- Family​ ​reasons

These​ ​employees​ ​would​ ​expect​ ​to​ ​receive​ ​a​ ​reference​ ​from​ ​the​ ​employer.​ ​Employees​ ​generally​ ​need​ ​to
give​ ​advance​ ​notice​ ​as​ ​to​ ​when​ ​their​ ​resignation​ ​will​ ​be​ ​effective.

Dismissals:​ ​The​ ​termination​ ​of​ ​a​ ​worker's​ ​employment​ ​due​ ​to​ ​incompetence​ ​or​ ​breach​ ​of​ ​contract
- Incompetence:​ ​Inability​ ​to​ ​perform​ ​the​ ​job
- Misconduct:​ ​Unacceptable​ ​behaviour
- Gross​ ​Misconduct:​ ​Major​ ​misbehaviour​ ​possibly​ ​endangering​ ​others,​ ​can​ ​lead​ ​to​ ​immediate
dismissal
- Legal​ ​Requirements
- Theft​ ​or​ ​dishonesty

Unfair​ ​Dismissal:​ ​When​ ​an​ ​employee​ ​is​ ​dismissed​ ​without​ ​a​ ​valid​ ​reason
Employee​ ​has​ ​a​ ​legal​ ​right​ ​to​ ​have​ ​case​ ​examined.
Discrimination:​ ​Age,​ ​Race,​ ​Gender,​ ​Religion

Constructive​ ​dismissal:​ ​when​ ​a​ ​worker​ ​is​ ​forced​ ​to​ ​resign​ ​because​ ​of​ ​employer​ ​actions

Retrenchments​ ​or​ ​lay-offs

Occurs​ ​when​ ​the​ ​organisation​ ​can​ ​no​ ​longer​ ​afford​ ​the​ ​worker/department/business​ ​activity.​ ​When​ ​the​ ​job
no​ ​longer​ ​exists​ ​and​ ​the​ ​worker​ ​can​ ​not​ ​be​ ​re-deployed​ ​(changes​ ​in​ ​technology/economics)

● Voluntary​ ​Redundancy:​ ​Employer​ ​asks​ ​for​ ​volunteers,​ ​often​ ​rewarded​ ​with​ ​severance​ ​pay​ ​which
varies​ ​depending​ ​on​ ​the​ ​worker's​ ​salary​ ​and​ ​length​ ​of​ ​time​ ​they​ ​have​ ​worked​ ​for​ ​this​ ​organization.

● Compulsory​ ​Redundancies:​ ​Employers​ ​have​ ​to​ ​choose​ ​which​ ​workers​ ​to​ ​make​ ​redundant.​ ​Achieved
through​ ​last​ ​in​ ​first​ ​out,​ ​or​ ​retention​ ​by​ ​merit.

● Redeployment:​ ​Transferring​ ​employees​ ​from​ ​a​ ​department​ ​or​ ​branch​ ​that​ ​no​ ​longer​ ​requires​ ​their
services​ ​to​ ​other​ ​areas​ ​of​ ​the​ ​business​ ​where​ ​vacancies​ ​exist.​ ​Can​ ​cause​ ​workers​ ​anxiety​ ​moving
into​ ​an​ ​unknown​ ​environment.

Changing​ ​employment​ ​Patterns​ ​and​ ​Practices

How​ ​work​ ​patterns,​ ​practices​ ​and​ ​preferences​ ​change​ ​and​ ​how​ ​they​ ​affect​ ​the​ ​employer​ ​and​ ​employees​ ​(such​ ​as
teleworking,​ ​flextime,​ ​migration​ ​for​ ​work)

Employment​ ​Sector
As​ ​a​ ​country​ ​develops​ ​and​ ​prospers​ ​→​ ​shifts​ ​to​ ​later​ ​sectors​ ​of​ ​the​ ​economy
Creates​ ​opportunities​ ​and​ ​also​ ​problems​ ​for​ ​where​ ​the​ ​work​ ​is​ ​leaving
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
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Ageing​ ​Population
Net​ ​birth​ ​rate​ ​has​ ​been​ ​falling​ ​ ​→​ ​People​ ​are​ ​living​ ​longer​ ​→​ ​average​ ​age​ ​of​ ​workers​ ​is​ ​rising
Shortage​ ​in​ ​labour​ ​supply​ ​will​ ​affect​ ​workforce​ ​planning/recruitment/training
Firms​ ​become​ ​more​ ​willing​ ​to​ ​appoint​ ​and​ ​retain​ ​older​ ​staff
Become​ ​more​ ​flexible​ ​in​ ​keeping​ ​staff​ ​beyond​ ​retirement​ ​age
Training​ ​is​ ​used​ ​as​ ​a​ ​means​ ​of​ ​retraining​ ​staff

Flexible​ ​Work​ ​Structures

Charles​ ​Handy’s​ ​theory​ ​of​ ​shamrock​ ​organization​ ​-​ ​businesses​ ​will​ ​gradually​ ​use​ ​fewer​ ​core​ ​staff​ ​to​ ​improve
their​ ​flexibility
Firms​ ​increasingly​ ​outsourcing​ ​projects​ ​and​ ​using​ ​consultants
Great​ ​flexibility​ ​→​ ​larger​ ​number​ ​of​ ​people​ ​work​ ​from​ ​home
No​ ​such​ ​thing​ ​as​ ​lifetime​ ​job​ ​-multiskilled​ ​and​ ​flexible​ ​workers​ ​are​ ​attractive​ ​to​ ​organizations

Organizational​ ​restructuring:​ ​Less​ ​likely​ ​to​ ​be​ ​a​ ​traditional​ ​organizational​ ​structure​ ​as​ ​employees
are​ ​a​ ​variety​ ​of​ ​core/partime/and​ ​peripheral​ ​staff

Flexitime:​ ​Consultants,​ ​contractors​ ​and​ ​part-time​ ​employees​ ​are​ ​more​ ​likely​ ​to​ ​be​ ​allowed​ ​to​ ​work
hours​ ​that​ ​suit​ ​their​ ​individual​ ​needs​ ​(child​ ​care/higher​ ​education.)

Changing​ ​Recruitment​ ​Practices:​ ​Shifts​ ​to​ ​flexible​ ​workers​ ​→​ ​more​ ​likely​ ​to​ ​employ
part-time/temporary​ ​staff

Retention​ ​of​ ​Core​ ​Staff:​ ​Key​ ​employees​ ​of​ ​an​ ​organization​ ​retained​ ​for​ ​expertise​ ​→​ ​may​ ​be​ ​offered
first​ ​rate​ ​financial​ ​rewards

Training:​ ​Firms​ ​less​ ​likely​ ​to​ ​invest​ ​in​ ​training​ ​when​ ​not​ ​for​ ​core​ ​staff
​ ​ ​ ​ ​Pressure​ ​for​ ​staff​ ​to​ ​constantly​ ​update​ ​skill​ ​(by​ ​own​ ​pay​ ​or​ ​company)

Teleworking
Jack​ ​Niles​ ​(1973)​ ​-​ ​refers​ ​to​ ​working​ ​away​ ​from​ ​the​ ​office​ ​by​ ​using​ ​electronic​ ​forms​ ​of​ ​communication
Occurred​ ​due​ ​to​ ​problems​ ​communicating​ ​in​ ​central​ ​business​ ​districts​ ​and​ ​ICT​ ​advances
Core​ ​number​ ​of​ ​hours​ ​someone​ ​has​ ​to​ ​work​ ​in​ ​the​ ​office​ ​and​ ​the​ ​remainder​ ​at​ ​home

Applications:​ ​Insurance​ ​firms,​ ​banks,​ ​market​ ​research​ ​firms,​ ​airlines

Call​ ​centres:​ ​where​ ​teams​ ​of​ ​workers​ ​deal​ ​with​ ​customer​ ​enquiries​ ​and​ ​complaints​ ​through​ ​the​ ​phone

Homeworking:​ ​Part​ ​of​ ​teleworking​ ​where​ ​people​ ​work​ ​from​ ​home.​ ​Advances​ ​in​ ​technology​ ​and​ ​reduction
in​ ​cost​ ​of​ ​ICT​ ​systems​ ​ ​mean​ ​more​ ​people​ ​start​ ​working​ ​from​ ​home.

Avantages Disadvantages

Employees ❖ Job​ ​opportunities​ ​-​ ​especially​ ​in ❖ Huge​ ​dependence​ ​on​ ​use​ ​and
remote​ ​areas reliability​ ​of​ ​ICT​ ​software
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
❖ Suitable​ ​for​ ​those​ ​caring​ ​for
family​ ​or​ ​elderly
❖ Flexible​ ​working​ ​hours
❖ No​ ​travel​ ​costs
❖ Autonomy​ ​in​ ​decision​ ​making
and​ ​organizing​ ​work
❖ Income​ ​tax​ ​allowances​ ​for​ ​using
personal​ ​property​ ​for
conducting​ ​business​ ​activity
❖ Workers​ ​often​ ​exceed​ ​working
time​ ​directives
❖ Suffer​ ​from​ ​social​ ​isolation
❖ Less​ ​job​ ​security​ ​and​ ​trade​ ​union
representation
❖ Likely​ ​to​ ​face​ ​distraction
❖ Lack​ ​of​ ​training​ ​opportunities​ ​and
career​ ​development

Employers ❖ Reduce​ ​office​ ​space​ ​fees
❖ Flexible/extended​ ​working
hours​ ​can​ ​be​ ​offered​ ​to
customers
❖ Continuity​ ​of​ ​service​ ​from​ ​those
with​ ​young​ ​children​ ​or​ ​other
dependents
❖ Lower​ ​absenteeism​ ​rate
❖ Flexibility​ ​to​ ​deal​ ​with​ ​working
time​ ​directives​ ​(laws)
❖ Set​ ​up​ ​costs​ ​of​ ​ICT​ ​equipment​ ​can
be​ ​high
❖ Requires​ ​tight​ ​control​ ​in
recruitment​ ​to​ ​look​ ​for​ ​right​ ​type
of​ ​person
❖ Management​ ​and​ ​monitoring​ ​are
more​ ​difficult
❖ Technological​ ​breakdowns​ ​cause
disruption​ ​to​ ​business
❖ Not​ ​always​ ​possible​ ​due​ ​to​ ​lack​ ​of
space/confidentiality​ ​of​ ​data​ ​held
at​ ​home

Portfolio​ ​Working
Charles​ ​Handy​ ​-​ ​A​ ​person​ ​employed​ ​in​ ​a​ ​number​ ​of​ ​different​ ​jobs,​ ​carried​ ​out​ ​simultaneously,​ ​usually​ ​on​ ​a
part-time​ ​or​ ​temporary​ ​basis.​ ​Worker​ ​chargers​ ​a​ ​fee​ ​for​ ​each​ ​unit​ ​of​ ​work​ ​carried​ ​out

Advantages Disadvantages

Increases​ ​flexibility​ ​and Lack​ ​of​ ​job​ ​security

mobility​ ​of​ ​an​ ​organization's
HR
Variety​ ​of​ ​experience
contributes​ ​to​ ​a​ ​fuller​ ​career
Peak​ ​seasons​ ​have​ ​lots​ ​of​ ​work
and​ ​off​ ​seasons​ ​may​ ​have​ ​none
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​Ex.​ ​gardener,​ ​plumbers

Part-time​ ​Employment
Shift​ ​due​ ​to​ ​more​ ​females​ ​and​ ​students​ ​opting​ ​to​ ​work​ ​part​ ​time​ ​and​ ​benefits​ ​of​ ​labour​ ​flexibility.

Advantages​ ​to​ ​business: Disadvantages​ ​to​ ​Business

➢ Cheaper​ ​to​ ​employ​ ​as​ ​they​ ​are
entitled​ ​to​ ​lower​ ​remuneration
(pay​ ​and​ ​benefits)
➢ Easier​ ​to​ ​replace
➢ Large​ ​pool​ ​of​ ​potential​ ​workers
➢ Part​ ​time​ ​employees​ ​feel​ ​less​ ​valued​ ​and​ ​are​ ​less​ ​loyal
→​ ​decreases​ ​motivation,​ ​productivity​ ​and​ ​labour
retention
➢
➢ Higher​ ​turnover​ ​rates​ ​→​ ​large​ ​amounts​ ​of​ ​time​ ​and
money​ ​spent​ ​on​ ​hiring,​ ​inducting​ ​and​ ​training​ ​new​ ​staff

Flexitime
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
System​ ​which​ ​requires​ ​employees​ ​to​ ​work​ ​for​ ​a​ ​core​ ​period​ ​of​ ​time​ ​then​ ​the​ ​rest​ ​is​ ​determined​ ​by​ ​the
individual.
Ex.​ ​Worker​ ​required​ ​to​ ​work​ ​36hrs​ ​a​ ​week​ ​may​ ​work​ ​9​ ​hours​ ​Mon-Thur​ ​then​ ​have​ ​Fri​ ​off

Shiftwork​:​ ​Different​ ​groups​ ​of​ ​people​ ​working​ ​at​ ​different​ ​time​ ​allocations.

Advantages Disadvantages

❏ Extend​ ​normal​ ​working​ ​hours​ ​of​ ​a ❏ Lack​ ​of​ ​supervision​ ​for

business​ ​→​ ​generates​ ​more​ ​sales employees​ ​in​ ​non​ ​traditional
❏ Reduce​ ​the​ ​need​ ​for​ ​paying​ ​staff​ ​to​ ​work hours
overtime ❏ Increased​ ​utility​ ​costs
❏ Improve​ ​firm's​ ​image​ ​→​ ​equal ❏ Difficult​ ​to​ ​schedule​ ​meetings
opportunities​ ​for​ ​employees​ ​who​ ​can’t and​ ​larger​ ​group​ ​functions
work​ ​standard​ ​hours
❏ Gives​ ​employees​ ​greater​ ​deal​ ​of​ ​freedom
to​ ​balance​ ​work​ ​and​ ​personal​ ​life

Migration​ ​of​ ​Workers

UN​ ​defines​ ​migrant​ ​worker​ ​as;​ ​a​ ​person​ ​who​ ​is​ ​engaged​ ​in​ ​remunerated​ ​activity​ ​in​ ​a​ ​State​ ​of​ ​which​ ​he​ ​or
she​ ​is​ ​not​ ​a​ ​national”.​ ​Ie.​ ​anyone​ ​working​ ​outside​ ​their​ ​home​ ​country.

Benefits​ ​for​ ​Host​ ​Country:

- Contribute​ ​to​ ​economic​ ​growth​ ​through​ ​production,​ ​consumption​ ​and​ ​payment​ ​of​ ​taxes
Benefits​ ​for​ ​Origin:
Remit​ ​portion​ ​of​ ​pay​ ​back​ ​into​ ​home​ ​country.

Reasons​ ​for​ ​Migration​ ​of​ ​workers

Pay​ ​and​ ​Remuneration

Multinationals​ ​attract​ ​migrant​ ​worker​ ​by​ ​offering​ ​better​ ​pay​ ​and​ ​remuneration.​ ​May​ ​also​ ​choose
countries​ ​for​ ​their​ ​lower​ ​tax​ ​rates.
Ex.​ ​subsidised​ ​housing,​ ​medical,​ ​education​ ​allowance

Seasonal​ ​Factors
Workers​ ​dependent​ ​on​ ​season​ ​may​ ​migrate​ ​during​ ​off-peak​ ​seasons​ ​to​ ​find​ ​employment​ ​in​ ​other
countries
Ex.​ ​farmers,​ ​snow​ ​sports

Domestic​ ​Instability
Political​ ​instability,​ ​lack​ ​of​ ​security​ ​and​ ​business​ ​opportunity​ ​in​ ​domestic​ ​economy​ ​are​ ​key​ ​drivers
for​ ​migrant​ ​workers

Higher​ ​Standard​ ​of​ ​Living

Better​ ​career​ ​prospects​ ​and​ ​educational​ ​opportunities​ ​for​ ​migrant​ ​workers
Outsourcing,​ ​Offshoring​ ​and​ ​reshoring
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
Outsourcing,​ ​offshoring​ ​and​ ​reshoring​ ​as​ ​human​ ​resource​ ​strategies

Globalization​ ​→​ ​Intensified​ ​competition​ ​and​ ​need​ ​for​ ​cost​ ​advantage

Cost​ ​advantage​ ​can​ ​be​ ​achieved​ ​through​ ​outsourcing​:​ ​practice​ ​of​ ​transferring​ ​internal​ ​business​ ​activities​ ​to
an​ ​external​ ​firm​ ​as​ ​a​ ​method​ ​of​ ​reducing​ ​costs.​ ​Subcontractors​ ​can​ ​carry​ ​out​ ​outsourced​ ​work​ ​for​ ​less​ ​than
their​ ​clients​ ​without​ ​compromising​ ​quality.

Reasons​ ​to​ ​outsource:

Non​ ​core​ ​business​ ​activities
Ex.​ ​school​ ​→​ ​ ​catering

Lacks​ ​specific​ ​skills​ ​&​ ​expertise

Ex.​ ​ICT​ ​function​ ​of​ ​a​ ​business​ ​such​ ​as​ ​networking​ ​and​ ​system​ ​upgrades,​ ​market​ ​research

Cut​ ​costs​ ​of​ ​production

Leads​ ​to​ ​productivity​ ​gains​ ​and​ ​cost​ ​advantage
Ex.​ ​outside​ ​countries​ ​with​ ​lower​ ​labour​ ​costs

Advantages Disadvantages

Specialists​ ​hired​ ​to​ ​work​ ​at​ ​high​ ​quality​ ​standards Subcontractor​ ​have​ ​been​ ​known​ ​to​ ​cut​ ​corners
which​ ​leads​ ​to​ ​conflict

Different​ ​subcontractors​ ​will​ ​bid​ ​for​ ​outsourced Quality​ ​management​ ​can​ ​be​ ​difficult​ ​-​ ​outside​ ​firms
work​ ​which​ ​means​ ​work​ ​is​ ​provided​ ​at​ ​competitive have​ ​large​ ​influence​ ​on​ ​reputation​ ​of​ ​business
rates

Reduces​ ​labour​ ​costs​ ​ ​-​ ​not​ ​entitled​ ​to​ ​holiday​ ​pay, To​ ​monitor​ ​(deadlines/quality)​ ​ ​them​ ​increases
sick​ ​leave​ ​etc. costs​ ​of​ ​administering​ ​outsourced​ ​activities

Allows​ ​business​ ​to​ ​concentrate​ ​on​ ​core​ ​activities Can​ ​cause​ ​redundancies​ ​in​ ​an​ ​organization​ ​→
→​ ​improves​ ​efficiency reduced​ ​moral​ ​and​ ​motivation

Improves​ ​workforce​ ​flexibility.​ ​No​ ​need​ ​to​ ​recruit Associated​ ​with​ ​unethical​ ​practices​ ​such​ ​as
during​ ​busier​ ​periods​ ​as​ ​subcontractors​ ​can​ ​be exploitation​ ​of​ ​labour​ ​→​ ​bad​ ​ethical​ ​practice​ ​and
used​ ​to​ ​increase​ ​output bad​ ​corporate​ ​image

Offshoring
Extension​ ​of​ ​outsourcing​ ​that​ ​involves​ ​relocating​ ​business​ ​activity​ ​abroad

English​ ​and​ ​US​ ​brands​ ​dominate​ ​offshoring

Countries​ ​such​ ​as​ ​India​ ​and​ ​Philippines​ ​are​ ​attractive​ ​as​ ​large​ ​population​ ​of​ ​educated​ ​english​ ​speakers​ ​who
get​ ​paid​ ​significantly​ ​less​ ​than​ ​western​ ​world
Ex.​ ​call​ ​centres,​ ​financial​ ​management,​ ​computer​ ​software​ ​development,​ ​and​ ​legal​ ​transcriptions
2.1​ ​Functions​ ​and​ ​Evolution​ ​of​ ​Human​ ​Resource
Management
Advantages Disadvantages

Help​ ​businesses​ ​get​ ​around Quality​ ​of​ ​management

protectionist​ ​measures
Subject​ ​to​ ​changes​ ​in​ ​external​ ​environment
Cheaper​ ​labour Ex.​ ​cost​ ​advantages​ ​may​ ​be​ ​wiped​ ​out​ ​due​ ​to
increase​ ​in​ ​exchange​ ​rate

Reshoring
Reversal​ ​of​ ​offshoring,​ ​transfer​ ​of​ ​business​ ​operations​ ​back​ ​to​ ​their​ ​countries​ ​of​ ​origin.​ ​Popularity​ ​has
increased​ ​since​ ​cost​ ​effectiveness​ ​has​ ​declined

Reasons​ ​for​ ​Reshoring

Ethics
Mass​ ​media​ ​coverage​ ​of​ ​outsourced​ ​business​ ​practices​ ​seen​ ​as​ ​unethical.​ ​Improving​ ​monitoring
quality​ ​and​ ​consistency​ ​of​ ​output​ ​is​ ​easier​ ​if​ ​production​ ​is​ ​re-shored

Raised​ ​labour​ ​costs

China’s​ ​phenomenal​ ​economic​ ​growth​ ​→​ ​rising​ ​wage​ ​demands.​ ​Cheaper​ ​to​ ​produce​ ​in​ ​other​ ​Asian
countries​ ​or​ ​back​ ​home.

Transport​ ​costs
Continually​ ​rising​ ​cost​ ​of​ ​transportation​ ​→​ ​more​ ​cost​ ​effective​ ​for​ ​businesses​ ​to​ ​be​ ​located​ ​nearer
to​ ​their​ ​customers

Customization
Increased​ ​demand​ ​of​ ​customization​ ​→​ ​businesses​ ​need​ ​to​ ​be​ ​more​ ​responsive​ ​to​ ​customer
demands​ ​and​ ​market​ ​changes

Government
Domestic​ ​governments​ ​support​ ​re-shoring​ ​to​ ​bring​ ​back​ ​jobs​ ​and​ ​balance​ ​government​ ​budgets
 2.2​ ​Organizational​ ​Structure
Organizational​ ​Structure
Organizational​ ​Structure​ ​allows​ ​businesses​ ​to​ ​function​ ​more​ ​efficiently​ ​due​ ​to:
Accountability:​​ ​Shows​ ​who​ ​is​ ​held​ ​responsible​ ​for​ ​each​ ​particular​ ​job
Responsibility:​ ​Shows​ ​who’s​ ​in​ ​charge​ ​of​ ​who​ ​and​ ​in​ ​what​ ​role/capacity

Small​ ​businesses​ ​tend​ ​to​ ​have​ ​more​ ​of​ ​an​ ​inform​ ​organizational​ ​structure​ ​where​ ​roles​ ​change​ ​depending
on​ ​demand.​ ​As​ ​businesses​ ​get​ ​larger​ ​→​ ​More​ ​structured.

Delegation​ ​&​ ​Span​ ​of​ ​Control

The​ ​following​ ​terminology​ ​to​ ​facilitate​ ​understanding​ ​of​ ​different​ ​types​ ​of​ ​organizational​ ​structure:
Delegation​ ​and​ ​Span​ ​of​ ​Control

Delegation:​ ​Passing​ ​on​ ​of​ ​control​ ​and​ ​authority​ ​to​ ​others.​ ​Generally​ ​occurs​ ​as​ ​a​ ​as​ ​a​ ​business​ ​grows.​ ​The
line​ ​manager​ ​entrusts​ ​staff​ ​to​ ​complete​ ​a​ ​task​ ​or​ ​project,​ ​holding​ ​them​ ​accountable​ ​for​ ​their​ ​actions.
Responsibility​ ​still​ ​remains​ ​with​ ​line​ ​manager​ ​through​ ​work​ ​is​ ​done​ ​by​ ​authorised​ ​person.

Advantages​ ​&​ ​Disadvantages

Manager Employee

Saves​ ​time​ ​by​ ​not​ ​dealing Motivate​ ​and​ ​develop​ ​employees

with​ ​every​ ​task.​ ​More who​ ​feel​ ​like​ ​they​ ​have​ ​been
time​ ​to​ ​focus​ ​on​ ​strategic trusted​ ​and​ ​their​ ​talents
issues. recognized.

Poor​ ​delegation​ ​causes​ ​confusion

→​ ​demotivated​ ​staff​ ​and​ ​failure​ ​to
complete​ ​tasks

Span​ ​of​ ​Control:​ ​Refers​ ​to​ ​the​ ​number​ ​of​ ​people​ ​who​ ​are
directly​ ​accountable​ ​to​ ​a​ ​manager.​ ​Higher​ ​up​ ​in​ ​hierarchy​ ​→
wider​ ​span​ ​of​ ​control

Wide​ ​Span​ ​of​ ​Control:​ ​fewer​ ​layers​ ​are​ ​needed​ ​in​ ​the​ ​hierarchy​ ​which​ ​helps​ ​with​ ​cost​ ​control.
Communications​ ​between​ ​different​ ​levels​ ​should​ ​be​ ​more​ ​effective.
 2.2​ ​Organizational​ ​Structure
Narrow​ ​Span​ ​of​ ​Control​:​ ​Easier​ ​to​ ​communicate​ ​with​ ​and​ ​control​ ​a​ ​team.​ ​Smaller​ ​teams​ ​may​ ​be​ ​more
productive​ ​and​ ​have​ ​more​ ​cohesiveness.​ ​More​ ​costly.
Which​ ​is​ ​more​ ​optimum?
As​ ​the​ ​business​ ​environment​ ​continues​ ​to​ ​evolve
more​ ​businesses​ ​opt​ ​for​ ​a​ ​wider​ ​span​ ​of​ ​control
however​ ​this​ ​is​ ​based​ ​off​ ​several​ ​factors.

M​anager:​ ​The​ ​more​ ​skilled​ ​the​ ​manager​ ​to​ ​more

likely​ ​to​ ​have​ ​a​ ​wider​ ​span​ ​of​ ​control
O​rganizational​ ​Culture:​ ​NSC​ ​→​ ​close​ ​monitoring
cultures​ ​WSC​ ​→​ ​democratic​ ​cultures
S​ubordinates:​ ​Skill​ ​level​ ​of​ ​the​ ​subordinates.​ ​Highly
skilled​ ​staff​ ​are​ ​more​ ​likely​ ​to​ ​work​ ​in​ ​smaller,
dynamic​ ​teams​ ​with​ ​their​ ​line​ ​manager​ ​having​ ​a
wider​ ​span​ ​of​ ​control
T​ask:​ ​Complex,​ ​urgent​ ​and​ ​important​ ​tasks​ ​require
narrow​ ​span​ ​of​ ​control,​ ​simple​ ​tasks​ ​can​ ​be​ ​done
with​ ​minimal​ ​supervision​ ​and​ ​a​ ​wider​ ​span​ ​of
control

Chain​ ​Of​ ​Command

Hierarchy:​​ ​Refers​ ​to​ ​the​ ​organizational​ ​structure​ ​based​ ​on​ ​a​ ​ranking​ ​system.​ ​Each​ ​hierarchical​ ​level​ ​is
associated​ ​with​ ​different​ ​degrees​ ​of​ ​authority​ ​and​ ​responsibilities

Line​ ​Manager:​ ​Person​ ​directly​ ​above​ ​an​ ​employee​ ​on​ ​the​ ​next​ ​hierarchical​ ​level.

Advantages​ ​&​ ​Disadvantages​ ​of​ ​Hierarchical​ ​Structures

Advantages Disadvantages

Show​ ​clear​ ​lines​ ​of​ ​communication​ ​→​ ​improves
coordination​ ​and​ ​productivity​ ​of​ ​workers
Establish​ ​departments​ ​or​ ​teams→​ ​ ​create​ ​a
sense​ ​of​ ​belonging​ ​and​ ​act​ ​as​ ​motivation
Departmentalisation​ ​mens​ ​workers​ ​can​ ​be​ ​isolated​ ​to​ ​their
official​ ​teams
Rather​ ​inflexible​ ​→​ ​problematic​ ​when​ ​there’s​ ​changes​ ​in
external​ ​environment​ ​that​ ​require​ ​flexible​ ​structural​ ​changes
in​ ​organization

Chain​ ​Of​ ​Command:​ ​Formal​ ​line​ ​of​ ​authority​ ​through​ ​which​ ​orders​ ​are​ ​passed​ ​down​ ​in​ ​an​ ​organization
- Can​ ​be​ ​seen​ ​through​ ​the​ ​organizational​ ​chart

Delayering
Delayering:​ ​Process​ ​of​ ​removing​ ​one​ ​or​ ​more​ ​levels​ ​in​ ​the​ ​hierarchy​ ​to​ ​flatten​ ​the​ ​organizational​ ​structure
Advantages Disadvantages

- Reduces​ ​Costs:​ ​costs​ ​savings​ ​are​ ​made​ ​on - Creates​ ​anxiety​ ​and​ ​sense​ ​of​ ​insecurity
salaries​ ​and​ ​benefits​ ​previously​ ​received​ ​by - Overloads​ ​staff​ ​as​ ​their​ ​workload​ ​increases
middle​ ​management - Decision​ ​making​ ​takes​ ​longer
 2.2​ ​Organizational​ ​Structure
- Improves​ ​speed​ ​of​ ​communication
- Encourages​ ​delegation​ ​and​ ​empowerment

Bureaucracy
Bureaucracy:​ ​Execution​ ​of​ ​tasks​ ​that​ ​are​ ​governed​ ​by​ ​official​ ​administrative​ ​formal​ ​rules​ ​of​ ​an​ ​organization.
Bureaucratic​ ​organizations​ ​are​ ​characterised​ ​by:
➢ ​ ​Prescribed​ ​rules​ ​and​ ​policies

➢ Standardized​ ​procedures

➢ Excess​ ​administration/paperwork/formalities

➢ ​ ​Formal​ ​hierarchical​ ​structures.

➢ Managers​ ​or​ ​staff​ ​working​ ​in​ ​duplicate​ ​roles​ ​with​ ​several​ ​managers

Max​ ​Weber,​ ​built​ ​on​ ​the​ ​work​ ​of​ ​Marx,​ ​suggested​ ​that​ ​bureaucratic​ ​organizations​ ​are​ ​governed​ ​by​ ​several
principles
● Continuity​:​ ​Establishment​ ​follows​ ​official​ ​rules​ ​and​ ​regulations​ ​rather​ ​than​ ​taking​ ​high​ ​risks​ ​which
jeopardize​ ​continuity​ ​and​ ​survival
● Rules​ ​&​ ​Regulations:​ ​Business​ ​activity​ ​is​ ​conducted​ ​in​ ​accordance​ ​with​ ​official​ ​policies.​ ​Clear​ ​lines​ ​of
authority,​ ​responsibility​ ​and​ ​accountability
● Hierarchical​ ​Structures:​ ​Formal​ ​hierarchical​ ​structure​ ​which​ ​can​ ​be​ ​somewhat​ ​impersonal
● Accountability:​ ​Formality​ ​makes​ ​each​ ​worker​ ​accountable​ ​for​ ​their​ ​own​ ​performance

Disadvantages
➔ Prevents​ ​creativity​ ​&​ ​risk​ ​taking
➔ Slows​ ​down​ ​decision​ ​making
➔ Highly​ ​inflexible
➔ Overcautious

Centralization​ ​and​ ​Decentralization

Centralized​ ​Structure:​ ​Decision​ ​making​ ​is​ ​made​ ​by​ ​a​ ​very​ ​small​ ​number​ ​of​ ​people,​ ​usually​ ​the​ ​senior
management​ ​team.
Favoured​ ​by​ ​Henri​ ​Fayol,​ ​Frederick​ ​Taylor​ ​and​ ​Henry​ ​Ford.

Decentralized​ ​Structure:​ ​Decision​ ​making,​ ​authority​ ​and​ ​responsibility​ ​is​ ​shared​ ​with​ ​others.​ ​Key​ ​strategic
decisions​ ​are​ ​still​ ​concentrated​ ​in​ ​the​ ​hands​ ​of​ ​the​ ​CEO​ ​and​ ​board​ ​of​ ​directors.

Advantages​ ​and​ ​Disadvantages​ ​of​ ​Centralizations

Advantages Disadvantages

- Rapid​ ​decision​ ​making - Added​ ​pressure​ ​for​ ​senior​ ​staff

- Better​ ​control - Inflexibility
- Decisions​ ​made​ ​by​ ​those​ ​most - Skills​ ​of​ ​employees​ ​not​ ​exploited
qualified - Delays​ ​due​ ​to​ ​sheer​ ​number​ ​of​ ​decisions
- Efficient needing​ ​to​ ​be​ ​made
- Demotivating
 2.2​ ​Organizational​ ​Structure
Factors​ ​in​ ​deciding
1. Size​ ​of​ ​organization,​ ​larger​ ​→​ ​more​ ​decentralization
2. Scale​ o​ f​ ​importance​ ​of​ ​the​ ​decision,​ ​more​ ​important​ ​→​ ​centralized
3. Level​ o ​ f​ ​risk,​ ​ ​high​ ​risk​ ​→​ ​centralized
4. Corporate​ ​culture,​ ​creativity​ ​→​ ​decentralized
5. Management​ ​attitudes​ ​and​ ​competencies
6. Use​ ​of​ ​ICT,​ ​ ​more​ ​ICT​ ​→​ ​more​ ​decentralization

Advantages​ ​and​ ​Disadvantages​ ​of​ ​ ​Decentralizations

Advantages Disadvantages

- Input​ ​from​ ​workforce - Costly

- Speedier​ ​decision-making - Inefficient
- Improved​ ​morale - Greater​ ​chance​ ​of​ ​mistakes
- Improved​ ​accountability - Loss​ ​of​ ​control
- Teamwork - Communication​ ​issues

Organizational​ ​Charts
The​ ​following​ ​types​ ​of​ ​organization​ ​charts:​ ​flat/horizontal,​ ​tall/vertical,​ ​hierarchical,​ ​by​ ​product,​ ​by​ ​function
and​ ​by​ ​region.
An​ ​organizational​ ​structure​ ​formally​ ​represents​ ​the​ ​roles​ ​and​ ​responsibilities​ ​of​ ​a​ ​business,​ ​as​ ​well​ ​as​ ​the
reporting​ ​lines​ ​between​ ​individuals​ ​in​ ​the​ ​business

Chart​:​ ​a​ ​diagram​ ​that​ ​outlines​ ​the​ ​formal​ ​roles,​ ​responsibilities,​ ​and​ ​reporting​ ​lines.
An​ ​organizational​ ​chart​ ​shows​ ​five​ ​important​ ​features​ ​of​ ​a​ ​business
1. Functional​ ​departments,​ ​ex.​ ​marketing,​ ​finance​ ​etc.
2. Chain​ ​of​ ​command
3. Span​ ​of​ ​control
4. Channels​ ​of​ ​communication
5. Levels​ ​of​ ​hierarchy

Levels​ ​of​ ​Hierarchy:​ ​Refers​ ​to​ ​how​ ​many​ ​levels​ ​of​ ​responsibility​ ​are​ ​in​ ​a​ ​business.​ ​Each​ ​level​ ​indicates
seniority.
Line​ ​Managers-​ ​people​ ​who​ ​have​ ​the​ ​authority​ ​to​ ​make​ ​decisions​ ​and​ ​who​ ​bears​ ​responsibility​ ​for
the​ ​outcomes​ ​of​ ​those​ ​things

Staff​ ​Manager​ ​-​ ​someone​ ​with​ ​the​ ​authority​ ​to​ ​communicate​ ​a​ ​decision​ ​made​ ​by​ ​the​ ​CEO​ ​without
the​ ​responsibility​ ​for​ ​that​ ​decision.

Chain​ ​of​ ​Command:​ ​Formal​ ​route​ ​by​ ​which​ ​a​ ​decision​ ​must​ ​travel​ ​through​ ​the​ ​organization.​ ​Traditionally,
decisions​ ​travel​ ​from​ ​top​ ​of​ ​the​ ​organization​ ​downwards
2.2​ ​Organizational​ ​Structure
Span​ ​of​ ​Control:​ ​Refers​ ​to​ ​how​ ​many​ ​subordinates​ ​are​ ​directly​ ​under​ ​the​ ​authority​ ​of​ ​a​ ​manager​ ​and
whom​ ​managers​ ​are​ ​responsible​ ​for.

Tall​ ​Organizational​ ​Charts:​ ​Have​ ​many​ ​levels​ ​in​ ​hierarchy​ ​and​ ​narrow​ ​span​ ​of​ ​control
Flat​ ​Organization​ ​Charts:​ ​Fewer​ ​levels​ ​and​ ​wide​ ​span​ ​of​ ​control

Advantages​ ​of​ ​tall​ ​structure Advantages​ ​of​ ​flat​ ​structure

★ Quicker​ ​and​ ​more​ ​effective​ ​communication
within​ ​smaller​ ​teams
★ Smaller​ ​teams​ ​are​ ​easier​ ​to​ ​control​ ​and
manage
★ Greater​ ​specialization​ ​and​ ​division​ ​of​ ​labor
helps​ ​increase​ ​efficiency​ ​and​ ​productivity
★ Greater​ ​opportunities​ ​for​ ​promotion​ ​→
improve​ ​staff​ ​retention​ ​and​ ​morale
★ Delegation​ ​is​ ​important​ ​and​ ​there​ ​is
opportunities​ ​for​ ​subordinated​ ​to​ ​take​ ​on
extra​ ​responsibility
★ Communication​ ​improved​ ​overall​ ​due​ ​to
less​ ​layers
★ Cheaper​ ​to​ ​operate​ ​as​ ​there’s​ ​fewer
managers

Hierarchical​ ​Organizational​ ​Charts:​ ​Traditional​ ​approach​ ​whereby​ ​emphasis​ ​is​ ​placed​ ​on​ ​subordinated
reporting​ ​to​ ​their​ ​line​ ​manager.​ ​Position​ ​of​ ​workers​ ​in​ ​the​ ​hierarchy​ ​indicates​ ​their​ ​rank,​ ​status​ ​and​ ​level​ ​of
authority.​ ​Those​ ​at​ ​the​ ​top​ ​of​ ​the​ ​hierarchy​ ​are​ ​most​ ​vital.​ ​Very​ ​bureaucratic​ ​and​ ​promotes​ ​specialization
at​ ​each​ ​level.

Organization​ ​By​ ​Products:​ ​May​ ​choose​ ​to​ ​structure​ ​HR​ ​by​ ​individual​ ​products
Organization​ ​by​ ​Function:​ ​Most​ ​business​ ​organized​ ​by​ ​function,​ ​marketing,​ ​finance,​ ​production
Organization​ ​by​ ​Region:​ ​Multinational​ ​companies​ ​are​ ​often​ ​organized​ ​by​ ​geographical​ ​region.​ ​Allows
businesses​ ​to​ ​be​ ​more​ ​aware​ ​and​ ​responsive​ ​to​ ​local​ ​cultural
differences​ ​and​ ​consumer​ ​needs

Project​ ​Based​ ​Organization

Changes​ ​in​ ​organizational​ ​structures​ ​such​ ​as​ ​project-based
organization
Project​ ​Based​ ​Organization:​ ​Where​ ​human​ ​resources​ ​are
organized​ ​around​ ​particular​ ​projects
Each​ ​project​ ​is​ ​lead​ ​by​ ​a​ ​project​ ​manager​ ​and​ ​supported
by​ ​a​ ​team​ ​of​ ​workers
Often​ ​used​ ​for​ ​a​ ​temporary​ ​period​ ​to​ ​execute​ ​specific
projects
 2.2​ ​Organizational​ ​Structure
Advantages​ ​and​ ​Disadvantages​ ​of​ ​Project-Based​ ​Organizations
Advantages Disadvantages

❏ Flexibility:​ ​as​ ​projects​ ​are​ ​time​ ​limited,
structures​ ​are​ ​continuously​ ​changing​ ​as
projects​ ​finish​ ​and​ ​new​ ​ones​ ​start
❏ Productivity:​ ​Projects​ ​are​ ​focused​ ​on​ ​solutions
rather​ ​than​ ​functionality.​ ​Focused​ ​on​ ​meeting
deadlines​ ​and​ ​working​ ​within​ ​budget
❏ Efficiency:​ ​Project​ ​manager​ ​makes​ ​decisions
and​ ​specialized​ ​team
❏ Motivational:​ ​Adds​ ​interest​ ​and​ ​variety​ ​as
individuals​ ​get​ ​to​ ​work​ ​on​ ​different​ ​projects
❏ Broadens​ ​professional​ ​experiences
❏ Discontinuity:​ ​Fewer​ ​options​ ​to​ ​develop
personally​ ​and​ ​professionally​ ​as​ ​workers​ ​always
moving​ ​between​ ​projects
❏ Isolation:​ ​Each​ ​team​ ​is​ ​self-sufficient​ ​and​ ​few
opportunities​ ​to​ ​work​ ​with​ ​others
❏ Inefficiencies:​ ​Each​ ​project​ ​needs​ ​its​ ​own
finances​ ​and​ ​team​ ​of​ ​experts
❏ Added​ ​pressure/​ ​stress​ ​moving​ ​from​ ​project​ ​to
project
❏ Conflicting​ ​interests​ ​and​ ​priorities:​ ​less
obligation​ ​to​ ​ensure​ ​team​ ​members​ ​get​ ​along

Matrix​ ​Structure:​ ​Form​ ​of​ ​project​ ​based​ ​organization​ ​which​ ​is​ ​the
flexible​ ​organization​ ​of​ ​employees​ ​from​ ​different​ ​departments
temporarily​ ​working​ ​together​ ​on​ ​a​ ​particular​ ​project
- Each​ ​member​ ​is​ ​held​ ​accountable​ ​to​ ​their​ ​official​ ​line
manager​ ​&​ ​the​ ​project​ ​manager
- Project​ ​manager​ ​does​ ​not​ ​need​ ​to​ ​micromanage​ ​individuals
as​ ​workers​ ​are​ ​skilled​ ​and​ ​experienced
- Capability​ ​is​ ​more​ ​important​ ​than​ ​rank​ ​in​ ​official
organizational​ ​structure

Handy’s​ ​Shamrock​ ​Organization

Changes​ ​in​ ​organizational​ ​structures​ ​such​ ​as​ ​Handy’s​ ​Shamrock​ ​Organization
Handy​ ​Shamrock
● Believed​ ​that​ ​people​ ​are​ ​the​ ​most​ ​important​ ​resource​ ​of​ ​any​ ​organization
● ​ ​Believed​ ​that​ ​business​ ​should​ ​place​ ​greater​ ​interest​ ​on​ ​meeting​ ​the​ ​needs​ ​of​ ​workers​ ​through​ ​job
enrichment​ ​and​ ​flexible​ ​working​ ​practice​ ​to​ ​increase​ ​wellbeing​ ​and​ ​morale​ ​of​ ​workers
● Emphasis​ ​on​ ​the​ ​dynamic​ ​nature​ ​of​ ​change​ ​within​ ​organizations​ ​and​ ​the​ ​external​ ​business
environment
● Short​ ​term​ ​contracts​ ​were​ ​more​ ​important​ ​over​ ​jobs​ ​for​ ​life
● Non​ ​essential​ ​business​ ​practice​ ​(canteen​ ​at​ ​school)​ ​should​ ​be​ ​outsourced

Three​ ​groups​ ​of​ ​workers​ ​within​ ​a​ ​Shamrock​ ​Organization

Core​ ​Staff:​ ​Full​ ​time​ ​professional​ ​workers​ ​who​ ​handle​ ​the​ ​daily​ ​operation​ ​of​ ​the​ ​business​ ​and​ ​are​ ​crucial​ ​to
an​ ​organization's​ ​operations,​ ​survival​ ​and​ ​growth.
Increases​ ​in​ ​technology​ ​→​ ​core​ ​staff​ ​small​ ​group
Tend​ ​to​ ​be​ ​well​ ​paid​ ​and​ ​remunerated

Peripheral​ ​Workers:​ ​Also​ ​known​ ​as​ ​contingent​ ​workforce​ ​consists​ ​of​ ​part-time,​ ​temporary​ ​and​ ​portfolio
workers​ ​who​ ​are​ ​employed​ ​as​ ​an​ ​when​ ​they​ ​are​ ​needed​ ​→​ ​help​ ​to​ ​reduce​ ​labour​ ​costs
Larger​ ​business​ ​→​ ​more​ ​peripheral​ ​workers
2.2​ ​Organizational​ ​Structure
Flexible​ ​part​ ​of​ ​the​ ​workforce
Suffer​ ​from​ ​lack​ ​of​ ​job​ ​security

Outsourced​ ​Workers:​ ​Consists​ ​of​ ​individuals​ ​or​ ​businesses​ ​not​ ​employed​ ​by​ ​organization​ ​but​ ​paid​ ​to
complete​ ​particular​ ​and​ ​specialized​ ​tasks
Experts​ ​in​ ​their​ ​field​ ​but​ ​likely​ ​to​ ​be​ ​relatively​ ​expensive

Impact​ ​of​ ​Culture​ ​and​ ​ICT​ ​on​ ​Communications​ ​In​ ​Organizations

How​ ​cultural​ ​differences​ ​and​ ​innovation​ ​in​ ​communication​ ​technologies​ ​may​ ​impact​ ​on​ ​communication​ ​in
an​ ​organization
Communication:​ ​Transfer​ ​of​ ​information​ ​from​ ​one​ ​party​ ​to​ ​another
Effective​ ​communication​ ​is​ ​VITAL​ ​in​ ​a​ ​business​ ​for​ ​people​ ​to​ ​have​ ​a​ ​better​ ​understanding​ ​of​ ​what​ ​to​ ​do

Cultural​ ​differences​ ​impact​ ​communication​ ​(language,​ ​tone​ ​etc.)

Global​ ​organizations​ ​often​ ​hire​ ​bilingual​ ​or​ ​multilingual​ ​employees

Innovation​ ​in​ ​technology​ ​→​ ​reduction​ ​of​ ​cost​ ​of​ ​domestic​ ​and​ ​international​ ​communications

Electronic​ ​Mail​ ​(Email)​:​ ​The​ ​process​ ​of​ ​using​ ​computer​ ​wide​ ​area​ ​networks​ ​(WAN)​ ​as​ ​a​ ​mailing​ ​system.
Data​ ​is​ ​electronically​ ​transmitted​ ​from​ ​one​ ​computer​ ​device​ ​to​ ​another.
→​ ​Very​ ​fast
→​ ​Can​ ​be​ ​transmitted​ ​to​ ​many​ ​people​ ​at​ ​the​ ​same​ ​time​ ​-​ ​improves​ ​communication
→​ ​Set​ ​up​ ​costs​ ​can​ ​be​ ​high​ ​(buying​ ​computers​ ​and​ ​using​ ​an​ ​Internet​ ​service​ ​provider)
→​ ​Data​ ​transmission​ ​is​ ​not​ ​always​ ​secure
→​ ​Can​ ​be​ ​used​ ​for​ ​the​ ​wrong​ ​reasons​ ​and​ ​decrease​ ​productivity

Mobile​ ​Devices:​ ​Mobile​ ​devices​ ​are​ ​used​ ​by​ ​managers​ ​and​ ​employees​ ​who​ ​are​ ​on​ ​the​ ​go​ ​(real​ ​estate
agents,​ ​sales​ ​reps​ ​&​ ​those​ ​travelling​ ​abroad​ ​for​ ​business).
→​ ​Advances​ ​in​ ​Wi-Fi​ ​and​ ​digital​ ​camera​ ​technology​ ​further​ ​popularised​ ​the​ ​use​ ​of​ ​mobile​ ​devices​ ​as
a​ ​form​ ​of​ ​information​ ​communication​ ​technology.

Video​ ​Conferencing:​ ​Uses​ ​a​ ​combination​ ​of​ ​telephone,​ ​computer​ ​and​ ​video​ ​technology.​ ​It​ ​allows​ ​people​ ​to
talk​ ​to​ ​each​ ​other​ ​and​ ​see​ ​each​ ​other.​ ​This​ ​is​ ​often​ ​used​ ​for​ ​international​ ​recruiting
→​ ​Allows​ ​meetings​ ​to​ ​take​ ​place​ ​when​ ​staff​ ​are​ ​in​ ​different​ ​locations​ ​-​ ​saves​ ​cost​ ​and​ ​travel​ ​time
→​ ​Can​ ​be​ ​high​ ​initial​ ​startup​ ​costs
→​ ​Video​ ​recordings​ ​can​ ​be​ ​made​ ​for​ ​future​ ​reference.
→​ ​Contact​ ​may​ ​be​ ​difficult​ ​due​ ​to​ ​the​ ​differences​ ​in​ ​time​ ​zones​ ​-​ ​may​ ​also​ ​affect​ ​mood/being​ ​of
employees
→​ ​There​ ​may​ ​be​ ​time​ ​lags​ ​between​ ​sending​ ​and​ ​receiving​ ​messages
2.3​ ​Leadership​ ​and​ ​Management
Key​ ​Functions​ ​of​ ​Management
The​ ​key​ ​functions​ ​of​ ​management
Functions​ ​of​ ​Management:​ ​ ​ ​Refers​ ​to​ ​the​ ​roles​ ​and​ ​responsibilities​ ​of​ ​managers.

Henri​ ​Fayol​ ​investigated​ ​the​ ​scientific​ ​management​ ​of​ ​labour​ ​organization​ ​and​ ​production​ ​and​ ​identified​ ​5​ ​functions
of​ ​management
1. Planning​:​ ​Managers​ ​are​ ​responsible​ ​for​ ​setting​ ​the​ ​course​ ​of​ ​action​ ​to​ ​achieve​ ​organizational​ ​objectives.
Includes​ ​both​ ​tactical​ ​(short​ ​term)​ ​and​ ​strategic​ ​(long​ ​term)​ ​plans
2. Commanding​:​ ​Managers​ ​give​ ​instructions​ ​and​ ​orders​ ​to​ ​their​ ​teams​ ​and​ ​subordinates​ ​in​ ​order​ ​to​ ​achieve
business​ ​objectives.​ ​This​ ​includes​ ​discipline.
3. Controlling:​ ​Managers​ ​are​ ​responsible​ ​for​ ​the​ ​performance​ ​and​ ​health​ ​and​ ​safety​ ​of​ ​their​ ​teams.
4. Coordinating​:​ ​Managers​ ​have​ ​the​ ​responsibility​ ​for​ ​ensuring​ ​that​ ​all​ ​departments​ ​strive​ ​to​ ​achieve​ ​the​ ​goals
of​ ​the​ ​organization.
5. Organizing:​ ​Managers​ ​organize​ ​resources​ ​in​ ​order​ ​to​ ​achieve​ ​corporate​ ​objectives.​ ​This​ ​might​ ​include
delegating​ ​or​ ​allocating​ ​tasks​ ​to​ ​workers​ ​to​ ​ensure​ ​that​ ​all​ ​deadlines​ ​are​ ​met.

Charles​ ​Handy​ ​proposed​ ​that​ ​there​ ​was​ ​three​ ​key​ ​roles​ ​of​ ​management.​ ​He​ ​believed​ ​that​ ​for​ ​management​ ​to​ ​be
effective​ ​they​ ​needed​ ​to​ ​have​ ​the​ ​helicopter​ ​factions​ ​(the​ ​ability​ ​to​ ​rise​ ​above​ ​situations​ ​and​ ​see​ ​the​ ​big​ ​picture).
1. Managers​ ​are​ ​general​ ​practitioners​:​ ​Handy​ ​compared​ ​health​ ​problems​ ​with​ ​the​ ​problems​ ​of​ ​the​ ​firm.​ ​For
instance​ ​if​ ​the​ ​firm​ ​was​ ​suffering​ ​from​ ​high​ ​staff​ ​turnover,​ ​low​ ​productivity,​ ​or​ ​customer​ ​satisfaction,​ ​it’s​ ​the
manager's​ ​role​ ​to​ ​do​ ​something​ ​about​ ​this.
2. Managers​ ​are​ ​confronters​ ​of​ ​dilemmas​:​ ​Managers​ ​are​ ​well​ ​paid​ ​because​ ​they​ ​have​ ​to​ ​deal​ ​with​ ​the​ ​constant
flow​ ​of​ ​dilemmas/problems.
3. Managers​ ​as​ ​a​ ​balance​ ​of​ ​cultural​ ​mixes:​ ​Handy​ ​argues​ ​that​ ​it​ ​is​ ​the​ ​manager’s​ ​role​ ​to​ ​balance​ ​out​ ​the
cultural​ ​mix​ ​in​ ​an​ ​organization​ ​to​ ​get​ ​the​ ​best​ ​out​ ​of​ ​each​ ​individual.​ ​Believed​ ​that​ ​organizations​ ​should
become​ ​flatter​ ​to​ ​improve​ ​communications​ ​and​ ​enhance​ ​decision​ ​making.

Peter​ ​F​ ​Drucker​ ​believed​ ​that​ ​people​ ​are​ ​the​ ​key​ ​to​ ​the​ ​success​ ​of​ ​a​ ​business.​ ​Managers​ ​should​ ​not​ ​get​ ​involved​ ​in
the​ ​daily​ ​activities​ ​of​ ​employees​ ​as​ ​they​ ​have​ ​more​ ​knowledge​ ​in​ ​certain​ ​areas​ ​than​ ​their​ ​line​ ​manager​ ​or​ ​other
colleagues.​ ​Encouraged​ ​decentralization.
1. Setting​ ​Organizational​ ​Objectives:​ ​Managers​ ​should​ ​set​ ​and​ ​communicate​ ​objectives.
2. Organizing​ ​tasks​ ​and​ ​people:​ ​Managers​ ​establish​ ​systems​ ​to​ ​ensure​ ​the​ ​different​ ​functional​ ​areas​ ​of​ ​the
business​ ​are​ ​integrated​ ​to​ ​achieve​ ​its​ ​objectives.
3. Communicating​ ​with​ ​and​ ​motivating​ ​people:​ ​For​ ​all​ ​the​ ​workforce​ ​to​ ​be​ ​efficient​ ​and​ ​productive,​ ​managers
must​ ​motivate.
4. Measuring​ ​performance:​ ​Should​ ​be​ ​measured​ ​by​ ​the​ ​extent​ ​to​ ​which​ ​each​ ​employee​ ​meets​ ​performance
objectives.
5. Developing​ ​People:​ ​Managers​ ​are​ ​responsible​ ​for​ ​bringing​ ​out​ ​the​ ​best​ ​in​ ​people.​ ​Involves​ ​giving
opportunities​ ​/​ ​extra​ ​responsibility.

The​ ​difference​ ​between​ ​management​ ​and​ ​leadership

Management​ ​versus​ ​leadership
Leader:​ ​Someone​ ​who​ ​influences​ ​and​ ​inspires​ ​others​ ​to​ ​get​ ​things​ ​done.​ ​Fosters​ ​motivation,​ ​respect,​ ​trust​ ​and
loyalty.

Leadership:​ ​The​ ​process​ ​of​ ​influencing​ ​and​ ​inspiring​ ​others​ ​to​ ​achieve​ ​organizational​ ​goals.​ ​Generally​ ​tend​ ​to​ ​focus
on​ ​achieving​ ​broader​ ​goals​ ​or​ ​visions​ ​without​ ​timeframes.
2.3​ ​Leadership​ ​and​ ​Management
Management:​ ​The​ ​art​ ​of​ ​getting​ ​things​ ​done​ ​through​ ​people.​ ​Problem​ ​solving​ ​and​ ​decision​ ​making​ ​-​ ​involves​ ​a
process​ ​of​ ​planning,​ ​organizing​ ​and​ ​coordinating​ ​human​ ​and​ ​capital​ ​resources​ ​to​ ​achieve​ ​organizational​ ​objectives.

Managers:​ ​Focus​ ​on​ ​achieving​ ​specific​ ​goals​ ​with​ ​definite​ ​time​ ​frames.

Key​ ​Differences​ ​Between​ ​The​ ​Two:

Time​ ​&​ ​Devotion:​ ​Management​ ​is​ ​9-5​ ​job​ ​where​ ​as​ ​leadership​ ​is​ ​being​ ​responsible​ ​24/7.​ ​Managers​ ​have
short​ ​term​ ​views,​ ​whereas​ ​leaders​ ​have​ ​long​ ​term​ ​views.

Roles​ ​and​ ​Responsibilities:​ ​Leaders​ ​are​ ​accountable​ ​for​ ​a​ ​much​ ​broader​ ​range​ ​of​ ​roles​ ​and​ ​responsibilities
and​ ​hence​ ​are​ ​innovative.​ ​Managers​ ​deal​ ​with​ ​routine​ ​and​ ​how​ ​to​ ​best​ ​administer​ ​the​ ​day-to-day​ ​operations
of​ ​a​ ​business.

Influence​ ​on​ ​Others:​ ​Instructions​ ​and​ ​orders​ ​from​ ​managers​ ​are​ ​listen​ ​to​ ​because​ ​they​ ​come​ ​from​ ​an​ ​official
position​ ​of​ ​authority.​ ​Leaders​ ​inspire​ ​motivation​ ​through​ ​action​ ​and​ ​focus​ ​on​ ​the​ ​individual​ ​less​ ​so​ ​the​ ​task.
Leaders​ ​are​ ​more​ ​socially​ ​engaged​ ​than​ ​managers.

Risk​ ​Taking:​ ​Managers​ ​follow​ ​predetermined​ ​rules​ ​in​ ​the​ ​organization.​ ​Whereas​ ​leaders​ ​are​ ​more​ ​radical​ ​in
their​ ​thinking​ ​and​ ​take​ ​risks​ ​to​ ​challenge​ ​the​ ​status​ ​quo​ ​and​ ​move​ ​an​ ​organization​ ​forward.

Vision:​ ​Some​ ​argue​ ​that​ ​it’s​ ​the​ ​vision​ ​that​ ​leaders​ ​have​ ​which​ ​separates​ ​them​ ​from​ ​managers.

Both​ ​management​ ​and​ ​leadership​ ​are​ ​essential​ ​for​ ​a​ ​business​ ​to​ ​be​ ​successful.​ ​It​ ​is​ ​possible​ ​for​ ​a​ ​manager​ ​to​ ​be​ ​a
leader​ ​and​ ​visa​ ​versa.

Leadership​ ​Styles
The​ ​following​ ​leadership​ ​styles:​ ​autocratic,​ ​paternalistic,​ ​democratic,​ ​laissez-faire​ ​and​ ​situational
Leadership​ ​Style:​ ​The​ ​ways​ ​in​ ​which​ ​decision​ ​makers​ ​behave​ ​or​ ​reveal​ ​their​ ​behaviour.

Autocratic:​ ​A​ ​leader​ ​who​ ​makes​ ​all​ ​decisions​ ​and​ ​prefers​ ​not​ ​to​ ​delegate​ ​any​ ​responsibility
Pros Cons

- Suitable​ ​in​ ​situations​ ​which​ ​require
quick​ ​or​ ​critical​ ​decision​ ​making
- Suitable​ ​when​ ​workers​ ​are
unskilled
- Communication​ ​is​ ​top​ ​down​ ​so​ ​the​ ​opinions​ ​or​ ​suggestions
of​ ​workers​ ​are​ ​ignored.
- This​ ​can​ ​lead​ ​to​ ​resentment​ ​amongst​ ​employees
- Has​ ​the​ ​potential​ ​to​ ​alienate​ ​and​ ​demotivate​ ​the​ ​workforce
- Causes​ ​high​ ​level​ ​of​ ​absenteeism​ ​and​ ​labor​ ​turnover

Paternalistic:​ ​A​ ​leader​ ​who​ ​treats​ ​their​ ​employees​ ​as​ ​if​ ​they​ ​were​ ​family​ ​members​ ​(acting​ ​in​ ​best​ ​interest​ ​of​ ​their
subordinates).
Negative​ ​Paternalistic:​ ​Occurs​ ​when​ ​the​ ​leader​ ​perceives​ ​the​ ​workers​ ​as​ ​less​ ​than​ ​capable,​ ​so​ ​leads​ ​by
guidance​ ​and​ ​control.

Positive​ ​paternalistic:​ ​Occurs​ ​when​ ​the​ ​leader​ ​perceives​ ​the​ ​workers​ ​as​ ​highly​ ​capable,​ ​so​ ​nurtures​ ​and
develops​ ​the​ ​workers
2.3​ ​Leadership​ ​and​ ​Management

Pros Cons

- Suitable​ ​in​ ​countries​ ​such​ ​as​ ​Japan​ ​and​ ​India - Workers​ ​may​ ​not​ ​necessarily​ ​want​ ​their​ ​life​ ​to​ ​be
where​ ​the​ ​cultural​ ​setting​ ​enables​ ​people​ ​to dictated​ ​by​ ​someone​ ​else.
work​ ​hard​ ​out​ ​of​ ​gratitude​ ​for​ ​their​ ​leader - Inappropriate​ ​in​ ​cultures​ ​with​ ​flatter,​ ​informal
structures​ ​which​ ​require​ ​creative​ ​thinking

Democratic:​​ ​A​ ​leader​ ​who​ ​involves​ ​employees​ ​in​ ​the​ ​decision-making​ ​process.​ ​They​ ​consult​ ​staff​ ​and​ ​consider​ ​their
views​ ​before​ ​making​ ​any​ ​final​ ​decision.
Pros Cons

- Better​ ​workplace​ ​morale​ ​as
employees​ ​feel​ ​their​ ​ideas
are​ ​being​ ​listened​ ​to
- Sharing​ ​ideas​ ​leads​ ​to
better​ ​decision​ ​making
- Might​ ​not​ ​be​ ​appropriate​ ​with​ ​a​ ​uneducated/unskilled​ ​workforce
that​ ​doesn’t​ ​have​ ​the​ ​capacity​ ​to​ ​understand​ ​the​ ​issues.
- The​ ​more​ ​people​ ​involved​ ​in​ ​making​ ​the​ ​decision​ ​the​ ​longer​ ​it
takes.
- Won’t​ ​work​ ​in​ ​situations​ ​where​ ​there​ ​needs​ ​to​ ​be​ ​a​ ​very​ ​clear
leadership​ ​(trade​ ​union​ ​strike​ ​action​ ​or​ ​PR​ ​crisis)

Laissez-faire:​ ​A​ ​leader​ ​who​ ​has​ ​minimal​ ​direct​ ​input​ ​into​ ​the​ ​work​ ​of​ ​employees.​ ​They​ ​allow​ ​subordinates​ ​to​ ​make
their​ ​own​ ​decisions​ ​and​ ​to​ ​complete​ ​tasks​ ​in​ ​their​ ​own​ ​way.​ ​The​ ​leader​ ​sets​ ​tasks​ ​and​ ​objectives​ ​but​ ​the​ ​employees
are​ ​able​ ​to​ ​decide​ ​the​ ​best​ ​way​ ​to​ ​achieve​ ​the​ ​task.
Pros Cons

- Cause​ ​high​ ​levels​ ​of​ ​motivation​ ​as​ ​staff​ ​feel
highly​ ​trusted​ ​and​ ​valued
- Feel​ ​they​ ​can​ ​contribute​ ​to​ ​the​ ​success​ ​of
the​ ​business
- Suitable​ ​in​ ​businesses​ ​where​ ​creativity​ ​is
important
- The​ ​coordination​ ​and​ ​decision​ ​making​ ​can​ ​be​ ​very
time​ ​consuming​ ​-​ ​execution​ ​of​ ​business​ ​strategy
can​ ​be​ ​prolonged
- Unsuitable​ ​for​ ​businesses​ ​which​ ​require​ ​quick
decision-making.
- Relies​ ​on​ ​strong​ ​teamwork​ ​and​ ​goodwill​ ​of
employees​ ​which​ ​may​ ​not​ ​always​ ​be​ ​available
- Might​ ​encourage​ ​slack

Situational​ ​Leadership:​ ​A​ ​leadership​ ​style​ ​that​ ​isn’t​ ​based​ ​on​ ​any​ ​single​ ​dominant​ ​approach​ ​but​ ​rather​ ​adapts
leadership​ ​style​ ​based​ ​on​ ​the​ ​situation​ ​which​ ​they​ ​are​ ​facing.

Factors​ ​that​ ​affect​ ​situational​ ​leadership​ ​style:​ ​CLOTS

Culture:​ ​What​ ​type​ ​of​ ​culture​ ​exists​ ​within​ ​the​ ​organization​ ​and​ ​what​ ​are​ ​the​ ​group​ ​norms?
Leader:​ ​How​ ​much​ ​trust​ ​do​ ​leaders​ ​have​ ​in​ ​their​ ​employees​ ​and​ ​what​ ​is​ ​their​ ​normal​ ​leadership​ ​style?
Organizational​ ​Structure:​ ​Is​ ​the​ ​hierarchical​ ​structure​ ​tall​ ​or​ ​flat?​ ​How​ ​large​ ​is​ ​the​ ​span​ ​of​ ​control?
Task:​ ​Are​ ​the​ ​tasks​ ​difficult,​ ​urgent,​ ​important,​ ​lowly​ ​skilled,​ ​complex?
Subordinates:​ ​What​ ​is​ ​the​ ​level​ ​of​ ​skill,​ ​motivation,​ ​unity​ ​of​ ​employees?​ ​How​ ​many​ ​are​ ​there?

Warren​ ​Bennis​ ​(studier​ ​of​ ​leadership)​ ​believes​ ​that​ ​leaders​ ​find​ ​their​ ​own​ ​style​ ​which​ ​suits​ ​them​ ​best​ ​but​ ​often​ ​adapt
between​ ​styles​ ​based​ ​on​ ​situations.
2.3​ ​Leadership​ ​and​ ​Management

Ethical​ ​Considerations​ ​&​ ​Cultural​ ​Differences

How​ ​ethical​ ​considerations​ ​and​ ​cultural​ ​differences​ ​may​ ​influence​ ​leadership​ ​and​ ​management​ ​styles​ ​in​ ​an
organization.
The​ ​style​ ​of​ ​leadership​ ​which​ ​a​ ​leader​ ​chooses​ ​to​ ​adopt​ ​depends​ ​on​ ​a​ ​variety​ ​of​ ​factors​ ​including​ ​the​ ​culture​ ​which
they​ ​are​ ​ ​part​ ​of.
Ex.​ ​Japan/Netherlands:​ ​Group​ ​decision​ ​making​ ​is​ ​the​ ​norm
​ ​ ​ ​ ​ ​ ​UK,​ ​USA,​ ​Australia:​ ​Leaders​ ​make​ ​the​ ​decision​ ​with​ ​decisiveness​ ​and​ ​transparency​ ​is​ ​the​ ​norm

Ethical​ ​considerations​ ​are​ ​also​ ​taken​ ​into​ ​account​ ​when​ ​determining​ ​the​ ​extent​ ​to​ ​which​ ​a​ ​leader​ ​accepts
responsibility​ ​for​ ​making​ ​sure​ ​that​ ​the​ ​business​ ​is​ ​ethical​ ​in​ ​their​ ​conduct.
- The​ ​basis​ ​of​ ​the​ ​person's​ ​ethics​ ​are​ ​derived​ ​from​ ​their​ ​personal​ ​values​ ​and​ ​moral​ ​judgement.

There​ ​is​ ​increasing​ ​pressure​ ​for​ ​a​ ​business​ ​to​ ​act​ ​in​ ​an​ ​ethical​ ​way​ ​as​ ​this​ ​often​ ​has​ ​an​ ​impact​ ​on​ ​many​ ​factors​ ​of​ ​a
business.​ ​Thus​ ​businesses​ ​must​ ​ensure​ ​their​ ​type​ ​of​ ​leadership​ ​is​ ​ethical.
- Leadership​ ​has​ ​a​ ​direct​ ​effect​ ​on​ ​the​ ​level​ ​of​ ​morale,commitment​ ​&​ ​competence​ ​which​ ​affects​ ​the
productivity​ ​and​ ​profitability​ ​of​ ​a​ ​business

International​ ​cultures​ ​and​ ​organizational​ ​cultures​ ​are​ ​often​ ​linked​ ​and​ ​thus​ ​the​ ​leadership​ ​style​ ​must​ ​be​ ​appropriate
2.4​ ​Motivation
Motivation
The​ ​following​ ​motivation​ ​theories:​ ​Taylor,​ ​Maslow,​ ​Herzberg​ ​(motivation-hygiene​ ​theory),​ ​Adams​ ​(equity
theory)​ ​and​ ​Pink
Motivation:​ ​The​ ​desire,​ ​effort​ ​and​ ​passion​ ​to​ ​achieve​ ​something.​ ​The​ ​willingness​ ​to​ ​complete​ ​a​ ​task​ ​or​ ​job
with​ ​enthusiasm.
Motivation​ ​Theory:​ ​How​ ​managers​ ​seek​ ​to​ ​motivate​ ​their​ ​workforce​ ​to​ ​maximise​ ​job​ ​satisfaction,​ ​staff
morale​ ​and​ ​labour​ ​productivity.

Benefits​ ​of​ ​increased​ ​worker​ ​motivation Warning​ ​sign​ ​of​ ​poor​ ​motivation​ ​in​ ​the​ ​workplace

➔ Higher​ ​morale​ ​and​ ​job​ ​satisfaction​ ​(leads​ ​to ➔ High​ ​absenteeism​ ​rate
improved​ ​productivity​ ​and​ ​quality) ➔ High​ ​labour​ ​turnover​ ​rate
➔ Better​ ​industrial​ ​relations ➔ High​ ​wastage​ ​level
➔ Lower​ ​absenteeism ➔ Increasing​ ​number​ ​of​ ​customer​ ​complaints
➔ Lower​ ​staff​ ​turnover ➔ Low​ ​quality​ ​output
➔ Improves​ ​corporate​ ​image ➔ Poor​ ​punctuality
➔ Higher​ ​profitability ➔ More​ ​disciplinary​ ​problems

Taylor​ ​(1911):​ ​ ​Believed​ ​that​ ​what​ ​people​ ​wanted​ ​most​ ​from​ ​employers​ ​was​ ​high​ ​wages.
- Principles​ ​of​ ​Scientific​ ​Management:​ ​employees​ ​are​ ​primarily​ ​motivated​ ​by​ ​money​ ​and​ ​that
productivity​ ​can​ ​be​ ​improved​ ​by​ ​setting​ ​output​ ​and​ ​efficiency​ ​targets​ ​related​ ​to​ ​pay.
- It​ ​was​ ​a​ ​manager's​ ​duty​ ​to​ ​decide​ ​how​ ​each​ ​task​ ​should​ ​be​ ​completed
- Promoted​ ​the​ ​use​ ​of​ ​division​ ​of​ ​labor​ ​to​ ​specialise​ ​the​ ​production​ ​process​ ​and​ ​improve​ ​efficiency
and​ ​output
- Differentiated​ ​Piecework:​ ​where​ ​workers​ ​are​ ​paid​ ​a​ ​standard​ ​level​ ​of​ ​output​ ​and​ ​receive​ ​a​ ​higher
rate​ ​if​ ​they​ ​exceed​ ​that​ ​level.​ ​It’s​ ​an​ ​incentive​ ​scheme​ ​which​ ​rewards​ ​the​ ​most​ ​productive​ ​workers.
- Highly​ ​successful​ ​in​ ​the​ ​1920’s​ ​with​ ​companies​ ​like​ ​Ford​ ​using​ ​it

CONS:
- Ignores​ ​the​ ​non-physical​ ​contribution​ ​of​ ​workers
- Scientific​ m​ anagement​ ​is​ ​ineffective​ ​when​ ​referring​ ​to​ ​jobs​ ​with​ ​mental​ ​outputs​ ​not​ ​physical​ ​ones
(psychologists,​ ​teachers​ ​etc.)
- People​ ​are​ ​not​ ​only​ ​motivated​ ​by​ ​money​ ​-​ ​ignores​ ​non-financial​ ​factors​ ​that​ ​motivate​ ​people
- Scientific​ ​management​ ​can​ ​lead​ ​to​ ​repetitive​ ​and​ ​monotonous​ ​tasks​ ​which​ ​leads​ ​to​ ​job
dissatisfaction.

Maslow​ ​(1943):​ ​Believed​ ​that​ ​people​ ​are​ ​motivated​ ​by​ ​more​ ​than​ ​just​ ​money​ ​-​ ​focused​ ​on​ ​the
psychological​ ​needs​ ​of​ ​workers.

Maslow's​ ​Hierarchy​ ​of​ ​Needs:​ ​People​ ​ ​need​ ​to​ ​be​ ​satisfied​ ​with​ ​their​ ​lower​ ​level​ ​needs​ ​before​ ​they​ ​can
progress​ ​to​ ​high​ ​level​ ​needs.
- Physiological​ ​Needs:​ ​Needs​ ​that​ ​must​ ​be​ ​met​ ​for​ ​people​ ​to​ ​survive.​ ​The​ ​amount​ ​of​ ​money​ ​workers
earn​ ​determines​ ​their​ ​ability​ ​to​ ​meet​ ​these​ ​basic​ ​needs.
- Security​ ​Needs:​ ​Demands​ ​necessary​ ​to​ ​make​ ​people​ ​feel​ ​safe​ ​and​ ​stale.​ ​Businesses​ ​may​ ​provide​ ​job
security,​ ​sick​ ​pay​ ​or​ ​maternity​ ​leave.
2.4​ ​Motivation
- Social​ ​Needs:​ ​Refers​ ​to​ ​the​ ​human​ ​desire​ ​to​ ​be​ ​accepted​ ​into​ ​a​ ​group​ ​(friendship​ ​or​ ​family).
Business​ ​may​ ​provide​ ​the​ ​opportunity​ ​to​ ​work​ ​in​ ​teams​ ​and​ ​promote​ ​a​ ​sense​ ​of​ ​belonging​ ​at​ ​at
work.
- Esteem​ ​Needs:​ ​Desire​ ​for​ ​recognition
and​ ​self​ ​respect.​ ​Schemes​ ​at​ ​work​ ​such
as​ ​employee​ ​of​ ​the​ ​month,​ ​praise​ ​and
positive​ ​reinforcement,​ ​internal
promotion.
- Self​ ​Actualisation:​ ​Forces​ ​that​ ​drive
people​ ​to​ ​be​ ​the​ ​best​ ​that​ ​they​ ​can​ ​be.
Business​ ​provide​ ​this​ ​by​ ​opportunities
for​ ​personal​ ​development​ ​and
promotion.

CONS:
- In​ ​reality​ ​it​ ​might​ ​not​ ​be​ ​feasible​ ​for​ ​a
business​ ​with​ ​thousands​ ​of​ ​factory
workers​ ​to​ ​meet​ ​all​ ​levels​ ​of​ ​need
- Levels​ ​of​ ​needs​ ​are​ ​somewhat​ ​difficult​ ​to​ ​measure
- Assumes​ ​that​ ​everyone​ ​is​ ​motivated​ ​in​ ​the​ ​prescribed​ ​order​ ​of​ ​the​ ​pyramid
- There​ ​is​ ​no​ ​explanation​ ​as​ ​to​ ​what​ ​motivates​ ​someone​ ​who​ ​has​ ​achieved​ ​self-actualization

Herzberg​ ​(1959):​ ​Focused​ ​on​ ​the​ ​sociological​ ​and​ ​psychological​ ​aspects​ ​of​ ​work.
- Believes​ ​there’s​ ​ ​two​ ​categories​ ​of​ ​factors​ ​which​ ​affect​ ​the​ ​level​ ​of​ ​motivation:​ ​hygiene​ ​factors​ ​and
motivators.
- Believed​ ​that​ ​firms​ ​should​ ​motivate​ ​their​ ​employees​ ​by​ ​using​ ​a​ ​democratic​ ​leadership​ ​style.
- Believed​ ​that​ ​workers​ ​are​ ​motivated​ ​by​ ​being​ ​responsible​ ​for​ ​their​ ​work
- People’s​ ​moods​ ​and​ ​priorities​ ​affects​ ​their​ ​level​ ​of​ ​motivation

Hygiene​ ​Factors:​ ​Also​ ​called​ ​maintenance​ ​factors,​ ​aspects​ ​of​ ​work​ ​that​ ​do​ ​not​ ​motivate​ ​but​ ​must​ ​be​ ​met​ ​to
prevent​ ​dissatisfaction.
Examples
- If​ ​a​ ​business​ ​pays​ ​less​ ​than​ ​average​ ​wages​ ​or​ ​has​ ​bad​ ​working​ ​conditions​ ​then​ ​it​ ​will
negatively​ ​affect​ ​employees.
- If​ ​a​ ​worker​ ​revives​ ​a​ ​raise​ ​-​ ​the​ ​raise​ ​itself​ ​doesn't​ ​motivate​ ​employees​ ​as​ ​they​ ​come​ ​to
expect​ ​further​ ​pay​ ​rises​ ​in​ ​the​ ​future.
- Organizational​ ​policies​ ​and​ ​rules,​ ​relationship​ ​with​ ​peers,​ ​physical​ ​security​ ​and​ ​working
conditions

Motivators:​ ​Factors​ ​which​ ​lead​ ​to​ ​the​ ​psychological​ ​growth​ ​of​ ​workers​ ​and​ ​hence​ ​increase​ ​satisfaction​ ​and
performance​ ​at​ ​work.​ ​The​ ​use​ ​of​ ​motivators​ ​help​ ​to​ ​improve​ ​the​ ​nature​ ​and​ ​content​ ​of​ ​a​ ​job.
Ways​ ​to​ ​improve​ ​Worker​ ​Motivation:
- Job​ ​Enlargement:​ ​Giving​ ​workers​ ​more​ ​variety​ ​in​ ​what​ ​they​ ​do​ ​making​ ​their​ ​work​ ​more​ ​interesting.
- Job​ ​Enrichment:​ ​Giving​ ​workers​ ​more​ ​complex​ ​and​ ​challenging​ ​tasks​ ​to​ ​exploit​ ​their​ ​potential.
- Job​ ​Empowerment:​ ​Delegating​ ​decision​ ​making​ ​power​ ​to​ ​workers​ ​over​ ​their​ ​areas​ ​of​ ​job
2.4​ ​Motivation
Examples
- Achievement,​ ​advancement,​ ​interesting​ ​tasks,​ ​opportunities​ ​for​ ​promotion,​ ​personal​ ​growth

Movement:​ ​when​ ​people​ ​do​ ​something​ ​because​ ​they​ ​need​ ​to​ ​(they​ ​feel​ ​obliged​ ​to)
Motivation:​ ​when​ ​people​ ​do​ ​something​ ​because​ ​they​ ​want​ ​to​ ​(based​ ​on​ ​intrinsic​ ​reasons)

CONS:
- Individuals​ ​are​ ​unique​ ​and​ ​thus​ ​it​ ​can​ ​be​ ​hard​ ​to​ ​find​ ​something​ ​which​ ​motivates​ ​a​ ​whole​ ​workforce
as​ ​opposed​ ​to​ ​an​ ​individual
- Doesn’t​ ​apply​ ​to​ ​those​ ​in​ ​low​ ​skilled​ ​jobs​ ​where​ ​job​ ​enrichment​ ​and​ ​empowerment​ ​aren’t​ ​features
of​ ​the​ ​work.
- Some​ ​employees​ ​may​ ​not​ ​want​ ​enriched​ ​jobs​ ​as​ ​it​ ​involves​ ​more​ ​responsibility​ ​and​ ​stress.

Adams’s​ ​Equity​ ​Theory​ ​(1963):​ ​Workers​ ​naturally​ ​compare​ ​their​ ​efforts​ ​or​ ​rewards​ ​to​ ​those​ ​of​ ​others​ ​in
the​ ​workplace.​ ​Each​ ​worker​ ​should​ ​receive​ ​remuneration​ ​that​ ​reflects​ ​their​ ​efforts.​ ​The​ ​degree​ ​of​ ​equity​ ​in
an​ ​organization​ ​is​ ​based​ ​off​ ​inputs​ ​(contributions​ ​made​ ​by​ ​the​ ​employee)​ ​to​ ​outcomes​ ​(financial​ ​and​ ​non
financial​ ​rewards).

Motivation​ ​occurs​ ​if​ ​the​ ​input​ ​to​ ​outcome​ ​ratio​ ​is​ ​seen​ ​to​ ​be​ ​fair​ ​in​ ​relation​ ​to​ ​others​ ​in​ ​the​ ​workforce
Inputs:​ ​expertise,​ ​experience,​ ​enthusiasm​ ​and​ ​effort
Outputs:​ ​remuneration,​ ​recognition,​ ​rank​ ​and​ ​responsibility

The​ ​degree​ ​of​ ​equity​ ​in​ ​the​ ​workplace​ ​has​ ​a​ ​direct​ ​impact​ ​on​ ​the​ ​level​ ​of​ ​motivation​ ​on​ ​three​ ​levels:
- Equity​ ​Norm:​ ​Workers​ ​expect​ ​an​ ​equitable​ ​remuneration​ ​for​ ​their​ ​contributions​ ​in​ ​their​ ​job.
- Social​ ​Comparison:​ ​Workers​ ​determine​ ​what​ ​is​ ​fair​ ​based​ ​on​ ​comparisons​ ​of​ ​their​ ​input​ ​and
outcome​ ​with​ ​those​ ​of​ ​their​ ​peers.
- Cognitive​ ​Distortion:​ ​Workers​ ​who​ ​feel​ ​under​ ​compensated​ ​become​ ​demotivated​ ​and​ ​may​ ​seek​ ​a
balance​ ​by​ ​altering​ ​their​ ​inputs​ ​or​ ​negotiating​ ​outcomes.

CONS:
- The​ ​concept​ ​of​ ​fairness​ ​is​ ​highly​ ​subjective
- Ignores​ ​demographic,​ ​psychological​ ​and​ ​cultural​ ​variables​ ​which​ ​affects​ ​people’s​ ​perceptions​ ​of
fairness

Pink​ ​(2009):​ ​Traditional​ ​rewards​ ​dulls​ ​and​ ​blocks​ ​the​ ​essential​ ​skill​ ​of​ ​creativity​ ​required​ ​from​ ​today's
workforce.
- Believes​ ​extrinsic​ ​factors​ ​no​ ​longer​ ​work​ ​because​ ​humans​ ​are​ ​more​ ​complex​ ​than​ ​horses​ ​who​ ​will
follow​ ​a​ ​carrot

His​ ​theory​ ​is​ ​based​ ​on​ ​three​ ​innate​ ​factors​ ​that​ ​drive​ ​humans:
➢ Autonomy:​ ​Being​ ​self-sufficient​ ​to​ ​direct​ ​our​ ​own​ ​lives
○ Task:​ ​What​ ​the​ ​workers​ ​do.​ ​Giving​ ​them​ ​space​ ​to​ ​work​ ​on​ ​tasks​ ​in​ ​creative​ ​ways
○ Time:​ ​When​ ​the​ ​workers​ ​do​ ​their​ ​tasks.​ ​Businesses​ ​today​ ​are​ ​much​ ​more​ ​flexible
organizations​ ​and​ ​allow​ ​employees​ ​to​ ​complete​ ​tasks​ ​in​ ​their​ ​own​ ​times​ ​(to​ ​an​ ​extent)
○ Technique:​ ​How​ ​workers​ ​do​ ​their​ ​tasks.​ ​Traditional​ ​command​ ​and​ ​control​ ​techniques​ ​don’t
work​ ​anymore.​ ​Workers​ ​should​ ​be​ ​trusted​ ​to​ ​do​ ​the​ ​task​ ​in​ ​their​ ​own​ ​way.
2.4​ ​Motivation
○ Team:​ ​Whom​ ​the​ ​employee​ ​works​ ​with​ ​to​ ​complete​ ​the​ ​task.​ ​Can​ ​promote​ ​autonomy​ ​by
allowing​ ​workers​ ​to​ ​assemble​ ​their​ ​own​ ​teams​ ​or​ ​choose​ ​team​ ​mates​ ​for​ ​a​ ​task.
➢ Master:​ ​Self-improvement​ ​to​ ​learn​ ​and​ ​create​ ​new​ ​things
○ Allows​ ​people​ ​to​ ​be​ ​better​ ​at​ ​something​ ​which​ ​matters​ ​to​ ​them​ ​as​ ​individuals
○ Providing​ ​tasks​ ​below​ ​an​ ​employee’s​ ​capabilities​ ​can​ ​cause​ ​boredom​ ​and​ ​demotivation​ ​-or-
the​ ​opposite​ ​can​ ​also​ ​happen​ ​if​ ​tasks​ ​out​ ​of​ ​reach​ ​are​ ​assigned.
○ To​ ​create​ ​an​ ​atmosphere​ ​for​ ​mastery​ ​to​ ​flourish:​ ​autonomy,​ ​clear​ ​goals,​ ​immediate
feedback,​ ​goldilocks​ ​tasks​ ​(not​ ​too​ ​easy​ ​not​ ​too​ ​hard).
➢ Purpose:​ ​Self-esteem​ ​and​ ​drive​ ​to​ ​do​ ​better​ ​by​ ​ourselves
○ The​ ​use​ ​of​ ​profits​ ​must​ ​have​ ​ ​a​ ​purpose.​ ​Allowing​ ​employees​ ​to​ ​have​ ​a​ ​say​ ​over​ ​how​ ​the
organization​ ​gives​ ​back​ ​to​ ​the​ ​community​ ​can​ ​be​ ​a​ ​strong​ ​motivator.
○ To​ ​achieve​ ​this​ ​third​ ​leg​ ​purpose​ ​goals​ ​must​ ​be​ ​clearly​ ​communicated.

Type​ ​X​ ​people:​ ​Extrinsic​ ​people​ ​are​ ​motivated​ ​by​ ​money​ ​and​ ​other​ ​rewards
Type​ ​I​ ​people:​ ​Intrinsic​ ​people​ ​are​ ​motivated​ ​by​ ​internal​ ​factors
Type​ ​I​ ​people​ ​often​ ​outperform​ ​type​ ​X​ ​people.

CONS:
- Theory​ ​may​ ​not​ ​be​ ​applicable​ ​across​ ​all​ ​professions​ ​as​ ​some​ ​transitional​ ​moves​ ​from​ ​one​ ​company
to​ ​another​ ​may​ ​not​ ​be​ ​because​ ​of​ ​self​ ​feelings​ ​of​ ​betterment​ ​but​ ​of​ ​higher​ ​pay.

SUMMARY
Theorist Theory Main​ ​Findings

F.W​ ​Taylor Scientific​ ​Management Pay,​ ​above​ ​all​ ​is​ ​the​ ​main​ ​source
of​ ​motivation

A​ ​Maslow Hierarchy​ ​of​ ​Needs Levels​ ​of​ ​human​ ​needs,​ ​from

physiological​ ​to​ ​self​ ​actualisation

F​ ​Herzberg Two​ ​Factor​ ​Theory Hygeine​ ​factors​ ​(which​ ​do​ ​not

moivate​ ​alone)​ ​and​ ​Motivators

J.S​ ​Adams Equity​ ​Theory Workers​ ​are​ ​moticated​ ​if​ ​there​ ​is
fairness​ ​in​ ​emuneration​ ​packages

D.H​ ​Pink Drive​ ​Theory Autonomy,​ ​mastery​ ​and​ ​purpose

are​ ​the​ ​drivers​ ​of​ ​motivation​ ​in
modern​ ​societies​ ​of​ ​the​ ​21st
century

Financial​ ​Rewards
The​ ​following​ ​types​ ​of​ ​financial​ ​rewards:​ ​salary,​ ​wages​ ​(time​ ​and​ ​piece​ ​rates),​ ​commision,​ ​profit​ ​related
pay,​ ​performance-related​ ​pay​ ​(PRP),​ ​employee​ ​share​ ​ownership​ ​schemes,​ ​fringe​ ​payments​ ​(perks)
Financial​ ​Rewards:​ ​Methods​ ​that​ ​businesses​ ​can​ ​use​ ​to​ ​motivate​ ​workers​ ​by​ ​using​ ​some​ ​form​ ​of​ ​monetary
payment.

Salaries:​ ​Financial​ ​rewards​ ​set​ ​at​ ​a​ ​fixed​ ​annual​ ​rate​ ​but​ ​paid​ ​on​ ​a​ ​monthly​ ​basis.​ ​Generally​ ​used​ ​where
output​ ​or​ ​productivity​ ​isn’t​ ​easy​ ​to​ ​measure​ ​(faster​ ​may​ ​not​ ​better​ ​quality​ ​such​ ​as​ ​teachers/doctors).
2.4​ ​Motivation

PROS CONS

- Salaries​ ​can​ ​improve​ ​a​ ​firm's​ ​cash​ ​flow
- It’s​ ​safe​ ​and​ ​convenient
- Workers​ ​often​ ​work​ ​longer​ ​than​ ​contracted
hours​ ​but​ ​don’t​ ​get​ ​paid​ ​more​ ​-​ ​as​ ​opposed
to​ ​people​ ​who​ ​are​ ​paid​ ​in​ ​cash​ ​on​ ​a​ ​daily
basis.
- Since​ ​it’s​ ​not​ ​easy​ ​to​ ​distinguish​ ​the​ ​efforts
or​ ​outputs​ ​of​ ​workers​ ​it​ ​can​ ​be​ ​hard​ ​to
reward​ ​those​ ​who​ ​are​ ​more​ ​productive
- There​ ​is​ ​little​ ​incentive​ ​to​ ​work​ ​harder​ ​as
people​ ​are​ ​paid​ ​the​ ​same​ ​amount​ ​for​ ​their
time.

Wages​ ​(time​ ​and​ ​piece​ ​rates):​ ​The​ ​reward​ ​for​ ​labour​ ​services,​ ​usually​ ​expressed​ ​as​ ​a​ ​hourly​ ​rate​ ​(time)​ ​or
as​ ​a​ ​measureable​ ​quantity​ ​of​ ​output​ ​(piece​ ​rate).​ ​Can​ ​be​ ​paid​ ​per​ ​hour,​ ​day​ ​or​ ​week.
- National​ ​Minimum​ ​Wage:​ ​A​ ​rate​ ​set​ ​by​ ​the​ ​government​ ​which​ ​all​ ​employees​ ​must​ ​be​ ​paid​ ​no​ ​less
than.
- Overtime​ ​Rate:​ ​A​ ​larger​ ​rate​ ​which​ ​employees​ ​are​ ​paid​ ​when​ ​they​ ​work​ ​outside​ ​their​ ​contracted
hours​ ​(time​ ​and​ ​a​ ​half​ ​or​ ​double​ ​time).
- Piece​ ​Rate:​ ​Rewards​ ​workers​ ​for​ ​each​ ​item​ ​they​ ​produce​ ​or​ ​sell​ ​per​ ​time​ ​period

PROS CONS

- Straightforward​ ​method​ ​which​ ​is​ ​easily
understood​ ​by​ ​employees
- (Piece​ ​Rate)​ ​ensures​ ​that​ ​workers​ ​are
paid​ ​for​ ​the​ ​actual​ ​amount​ ​of​ ​work​ ​they
do.
- (Piece​ ​Rate)​ ​motivates​ ​workers​ ​to​ ​do
more​ ​work​ ​to​ ​increase​ ​income).
- Workers​ ​are​ ​rewarded​ ​for​ ​time​ ​as​ ​opposed​ ​to
effort​ ​which​ ​can​ ​lead​ ​to​ ​slacking​ ​or​ ​poor
productivity.
- (Piece​ ​Rate)​ ​there​ ​becomes​ ​a​ ​need​ ​for​ ​quality
control
- (pIece​ ​Rate)​ ​Demoralisation​ ​due​ ​to​ ​the
uncertain​ ​level​ ​of​ ​income​ ​-​ ​if​ ​a​ ​machine​ ​broke
and​ ​thus​ ​hindered​ ​their​ ​pay.

Commision:​ ​Pays​ ​workers​ ​based​ ​on​ ​a​ ​proportion​ ​of​ ​sales​ ​or​ ​output​ ​contributed​ ​by​ ​a​ ​worker.​ ​Generally
used​ ​for​ ​people​ ​such​ ​as​ ​real​ ​estate​ ​agents​ ​or​ ​insurance​ ​brokers.​ ​Generally​ ​people​ ​still​ ​earn​ ​a​ ​base​ ​amount.

PROS CONS

- People​ ​still​ ​earn​ ​a​ ​base​ ​amount
have​ ​the​ ​chance​ ​to​ ​improve
upon​ ​it​ ​by​ ​working​ ​hard
- Bypass​ ​the​ ​problems​ ​of​ ​time
based​ ​systems
- Speedy​ ​production​ ​or​ ​aggressive​ ​selling​ ​doesn’t
correlate​ ​with​ ​high​ ​quality​ ​output​ ​or​ ​good​ ​customer
care
- Tasks​ ​can​ ​be​ ​repetitive​ ​and​ ​monotonous
- As​ ​commissioner​ ​is​ ​based​ ​on​ ​fluctuating​ ​levels​ ​of​ ​sale
it​ ​can​ ​be​ ​difficult​ ​for​ ​employees​ ​to​ ​meet​ ​basic​ ​needs
and​ ​can​ ​cause​ ​stress​ ​as​ ​they​ ​don’t​ ​know​ ​how​ ​much
they​ ​will​ ​earn.

Profit-Related​ ​Pay:​ ​A​ ​form​ ​of​ ​financial​ ​motivation​ ​where​ ​by​ ​pay​ ​is​ ​linked​ ​to​ ​the​ ​level​ ​of​ ​profits​ ​in​ ​the​ ​firm.
Usually​ ​paid​ ​as​ ​an​ ​annual​ ​bonus.

PROS CONS
2.4​ ​Motivation
- Strengthens​ ​employee​ ​loyalty​ ​and​ ​fosters - Proportion​ ​of​ ​profits​ ​paid​ ​to​ ​employees​ ​can
team​ ​spirit be​ ​seen​ ​as​ ​too​ ​small​ ​to​ ​provide​ ​any​ ​more
- Boosts​ ​labor​ ​efficiency​ ​and​ ​limits​ ​possibility incentive​ ​to​ ​work​ ​harder
of​ ​labour​ ​conflict - Individual​ ​efforts​ ​are​ ​not​ ​explicitly
- Helps​ ​to​ ​break​ ​down​ ​the​ ​“them​ ​and​ ​us” recognised​ ​by​ ​the​ ​payment
culture. - In​ ​reality​ ​-​ ​payments​ ​often​ ​go​ ​to​ ​senior
management.

Performance​ ​Related​ ​Pay:​ ​Rewards​ ​employees​ ​(individuals,​ ​teams​ ​or​ ​as​ ​a​ ​whole​ ​workforce)​ ​who​ ​meet
certain​ ​goals.​ ​The​ ​goals​ ​may​ ​be​ ​related​ ​to​ ​sales​ ​targets,​ ​competence,​ ​successful​ ​completion​ ​of​ ​a​ ​contract.​ ​It
can​ ​be​ ​paid​ ​as:
- Pay​ ​Rise:​ ​An​ ​increase​ ​in​ ​a​ ​person's​ ​pay​ ​due​ ​to​ ​meeting​ ​or​ ​exceeding​ ​his/her​ ​performance​ ​targets
- Performance​ ​Bonus:​ ​Paid​ ​to​ ​workers​ ​who​ ​have​ ​reached​ ​output​ ​or​ ​quality​ ​targets
- Gratuity:​ ​Paid​ ​to​ ​staff​ ​who​ ​complete​ ​their​ ​employment​ ​contracts.

PROS CONS

- More​ ​flexible​ ​than​ ​profit​ ​related​ ​pay
- Creates​ ​incentives​ ​for​ ​people​ ​to​ ​work
and​ ​perform​ ​better
- Seen​ ​as​ ​a​ ​fair​ ​system​ ​since​ ​hard​ ​work
is​ ​rewarded
- Helps​ ​develop​ ​a​ ​performance​ ​culture
where​ ​people​ ​strive​ ​to​ ​achieve​ ​their
targets.
- Targets​ ​may​ ​be​ ​unrealistic​ ​or​ ​unachievable
- Pressure​ ​imposed​ ​on​ ​workers​ ​can​ ​cause​ ​stress.
- Not​ ​appropriate​ ​for​ ​some​ ​professions​ ​where
quality​ ​is​ ​more​ ​important​ ​than​ ​quantity​ ​(doctors,
teachers)
- May​ ​not​ ​encourage​ ​teamwork​ ​as​ ​individual
targets​ ​are​ ​set
- Non-financial​ ​motivators​ ​are​ ​ignored

Employee​ ​Share​ ​Ownership​ ​Schemes:​ ​A​ ​payment​ ​system​ ​which​ ​rewards​ ​workers,​ ​managers,​ ​or​ ​directors
by​ ​giving​ ​them​ ​shares​ ​in​ ​the​ ​company​ ​or​ ​by​ ​selling​ ​the​ ​shares​ ​at​ ​a​ ​discounted​ ​price.​ ​Often​ ​used​ ​as​ ​an
alternative​ ​to​ ​awarding​ ​cash​ ​bonus​ ​or​ ​profit​ ​sharing.

PROS CONS

- Employees​ ​(now​ ​share​ ​owners​ ​of​ ​the
company)​ ​have​ ​a​ ​more​ ​direct​ ​interest​ ​in​ ​the
wellbeing​ ​of​ ​the​ ​organization.
- Thus​ ​-​ ​employees​ ​benefit​ ​from​ ​less
absenteeism​ ​and​ ​staff​ ​turnover
- In​ ​reality​ ​it​ ​tends​ ​to​ ​be​ ​used​ ​for​ ​rewarding
those​ ​in​ ​senior​ ​leadership​ ​positions.
- The​ ​majority​ ​of​ ​employees​ ​don’t​ ​qualify​ ​for
share​ ​ownership.
- The​ ​amount​ ​distributed​ ​is​ ​not​ ​sufficient​ ​to
sustain​ ​levels​ ​of​ ​motivation.

Fringe​ ​Payments​ ​(Perks):​ ​Financial​ ​benefits​ ​to​ ​employees​ ​in​ ​addition​ ​to​ ​their​ ​wage​ ​or​ ​salary.​ ​Perks​ ​vary
from​ ​one​ ​firm​ ​to​ ​another​ ​and​ ​depend​ ​on​ ​an​ ​employee's​ ​rank​ ​in​ ​a​ ​business.
- Ex.​ ​Health​ ​insurance,​ ​housing​ ​allowance,​ ​staff​ ​discount,​ ​gym​ ​membership,​ ​paid​ ​sick​ ​leave.

PROS CONS

- Encourage​ ​employee​ ​loyalty - Can​ ​be​ ​high​ ​cost​ ​to​ ​the​ ​company
- Can​ ​help​ ​to​ ​meet​ ​safety​ ​needs​ ​(Maslow) which​ ​has​ ​the​ ​potential​ ​to​ ​hinder​ ​its
- Make​ ​workers​ ​feel​ ​more​ ​valued​ ​as​ ​the​ ​employer​ ​is cash​ ​flow​ ​position.
2.4​ ​Motivation
trying​ ​to​ ​enhance​ ​their​ ​wellbeing.

Non-Financial​ ​Rewards
The​ ​following​ ​types​ ​of​ ​non-financial​ ​rewards:​ ​job​ ​enrichment,​ ​job​ ​rotation,​ ​job​ ​enlargement,​ ​empowerment,
purpose/the​ ​opportunity​ ​to​ ​make​ ​a​ ​difference​ ​,​ ​and​ ​teamwork
Non-Financial​ ​Rewards:​ ​Non-monetary​ ​factors​ ​that​ ​motivate​ ​people​ ​by​ ​offering​ ​psychological​ ​and
intangible​ ​benefits.

Job​ ​Enrichment:​ ​Giving​ ​workers​ ​more​ ​challenging​ ​jobs​ ​with​ ​more​ ​responsibilities.

PROS CONS

- People​ ​have​ ​greater​ ​autonomy​ ​and
authority​ ​in​ ​their​ ​work
- Better​ ​opportunities​ ​to​ ​accomplish​ ​their
goals.
- Workers​ ​are​ ​more​ ​committed​ ​to​ ​their
tasks
- Added​ ​expenses​ ​of​ ​time​ ​and​ ​money​ ​to​ ​train
and​ ​develop​ ​workers​ ​to​ ​fulfill​ ​their​ ​extra
responsibilities
- Increased​ ​workload​ ​can​ ​result​ ​in​ ​anxiety,
stress​ ​and​ ​lower​ ​productivity.

Job​ ​Rotation:​ ​A​ ​type​ ​of​ ​job​ ​enlargement​ ​which​ ​involves​ ​workers​ ​performing​ ​different​ ​tasks​ ​at​ ​the​ ​same
level​ ​of​ ​complexity​ ​in​ ​a​ ​systematic​ ​way.
Ex.​ ​Supermarket​ ​workers​ ​may​ ​work​ ​checkouts​ ​then​ ​in​ ​delicatessen,​ ​bakery​ ​or​ ​stacking​ ​shelves.

PROS CONS

- Provide​ ​more​ ​variety​ ​to​ ​avoid​ ​boredom​ ​which - Multitasking​ ​requires​ ​greater​ ​training
may​ ​result​ ​from​ ​over​ ​specialisation. costs
- Makes​ ​it​ ​easy​ ​for​ ​people​ ​to​ ​cover​ ​to​ ​absent - May​ ​be​ ​seen​ ​by​ ​employees​ ​as​ ​just​ ​adding
colleagues. to​ ​their​ ​workload.

Job​ ​Enlargement:​ ​Also​ ​known​ ​as​ ​horizontal​ ​loading,​ ​refers​ ​to​ ​the​ ​broadening​ ​in​ ​the​ ​number​ ​of​ ​tasks​ ​that​ ​an
employee​ ​performs​ ​although​ ​the​ ​job​ ​itself​ ​stays​ ​the​ ​same.
Ex.​ ​An​ ​administrative​ ​worker​ ​would​ ​spend​ ​time​ ​on​ ​reception,​ ​data​ ​input,​ ​photocopying​ ​and​ ​clerical
tasks.

PROS CONS

- Reduce​ ​the​ ​monotony​ ​of​ ​tasks​ ​that​ ​can
cause​ ​boredom.
- Can​ ​make​ ​a​ ​job​ ​more​ ​interesting​ ​as​ ​workers
have​ ​the​ ​ability​ ​to​ ​do​ ​a​ ​wider​ ​range​ ​of
tasks.
- Some​ ​employees​ ​may​ ​view​ ​it​ ​as​ ​a​ ​way​ ​to
get​ ​them​ ​to​ ​do​ ​more​ ​work​ ​→
demoralization
- Continual​ ​enlargement​ ​of​ ​a​ ​job​ ​over​ ​time
can​ ​lead​ ​to​ ​unmanageable​ ​workloads​ ​for
staff

Empowerment:​ ​Developing​ ​the​ ​potential​ ​of​ ​workers​ ​or​ ​teams​ ​to​ ​achieve​ ​the​ ​best​ ​they​ ​can.​ ​Involves
granting​ ​workers​ ​the​ ​authority​ ​to​ ​be​ ​in​ ​charge​ ​of​ ​their​ ​own​ ​jobs​ ​and​ ​execute​ ​their​ ​own​ ​ideas​ ​to​ ​solve
business​ ​problems.
2.4​ ​Motivation

Can​ ​be​ ​achieved​ ​through​ ​things​ ​such​ ​as:

➔ Delegation:​ ​The​ ​pass​ ​on​ ​of​ ​authority​ ​to​ ​subordinates,​ ​allowing​ ​them​ ​to​ ​take​ ​charge​ ​of​ ​a​ ​task​ ​and​ ​get
recognition​ ​for​ ​their​ ​accomplishments.
◆ Best​ ​achieved​ ​when​ ​subordinated​ ​have​ ​competence​ ​and​ ​desire
◆ Managers​ ​must​ ​ensure​ ​employees​ ​are​ ​given​ ​sufficient​ ​time​ ​and​ ​resources​ ​to​ ​complete​ ​tasks
➔ Worker​ ​Participation:​ ​When​ ​workers​ ​have​ ​opportunities​ ​to​ ​participate​ ​in​ ​decision-making​ ​so​ ​they
feel​ ​empowered.
◆ Allows​ ​people​ ​to​ ​become​ ​more​ ​involved​ ​and​ ​interested​ ​in​ ​their​ ​work
➔ Continuous​ ​Professional​ ​Development:​ ​Employers​ ​who​ ​provide​ ​opportunities​ ​for​ ​their​ ​staff​ ​to
undertake​ ​ongoing​ ​training.
◆ Can​ ​be​ ​an​ ​extra​ ​cost​ ​but​ ​this​ ​is​ ​generally​ ​worth​ ​it​ ​use​ ​to​ ​the​ ​benefit​ ​of​ ​having​ ​a​ ​more​ ​loyal,
empowered​ ​and​ ​productive​ ​workforce.

PROS CONS

- Can​ ​boost​ ​motivation​ ​and​ ​give​ ​people​ ​a - Requires​ ​giving​ ​workers​ ​the​ ​necessary
greater​ ​sense​ ​of​ ​pride​ ​in​ ​their​ ​work authority,​ ​skills,​ ​resources​ ​and​ ​opportunities
- Things​ ​listed​ ​above​ ​^^ to​ ​achieve​ ​personal​ ​and​ ​organizational​ ​goals.
- Only​ ​works​ ​if​ ​employees​ ​have​ ​adequate​ ​skills

Purpose
Some​ ​people​ ​are​ ​driven​ ​by​ ​self-interest​ ​and​ ​this​ ​has​ ​an​ ​impact​ ​on​ ​what​ ​can​ ​be​ ​used​ ​to​ ​motivate​ ​them.
Others​ ​are​ ​driven​ ​by​ ​purpose​ ​-​ ​the​ ​desire​ ​to​ ​use​ ​their​ ​work​ ​to​ ​help​ ​others​ ​and​ ​make​ ​a​ ​difference.
- Purpose​ ​is​ ​about​ ​the​ ​role​ ​or​ ​job​ ​itself​ ​rather​ ​than​ ​acts​ ​of​ ​altruism​ ​(donating​ ​money​ ​to​ ​charity)
- Purpose​ ​is​ ​a​ ​great​ ​way​ ​to​ ​inspire/motivate​ ​people​ ​who​ ​already​ ​have​ ​satisfactory​ ​salaries.

Teamwork:​ ​Where​ ​employees​ ​work​ ​with​ ​fellow​ ​colleagues

Examples
- Departmental​ ​Teams:​ ​Organising​ ​people​ ​into​ ​functional​ ​teams
- Cellular​ ​Manufacturing:​ ​Teamwork​ ​to​ ​complete​ ​part​ ​of​ ​a​ ​production​ ​process
- Quality​ ​Circles:​ ​Team​ ​members​ ​who​ ​meet​ ​regularly​ ​to​ ​discuss​ ​solutions​ ​to​ ​problems​ ​regarding
quality​ ​within​ ​production​ ​process

Teamwork​ ​can​ ​reduce​ ​boredom​ ​and​ ​help​ ​to​ ​meet​ ​social​ ​needs.​ ​It​ ​can​ ​also​ ​create​ ​a​ ​sense​ ​of​ ​belonging​ ​and
lead​ ​to​ ​greater​ ​flexibility​ ​and​ ​multitasking.

Cultures​ ​&​ ​Financial​ ​/​ ​Non-Financial​ ​Rewards

How​ ​financial​ ​and​ ​non-financial​ ​rewards​ ​may​ ​affect​ ​job​ ​satisfaction,​ ​motivation​ ​and​ ​productivity​ ​in
different​ ​cultures
There​ ​is​ ​no​ ​global​ ​rule​ ​as​ ​to​ ​how​ ​to​ ​best​ ​motivate​ ​employees​ ​-​ ​as​ ​each​ ​employee​ ​is​ ​unique.​ ​People​ ​are
motivated​ ​by​ ​both​ ​intrinsic​ ​and​ ​extrinsic​ ​factors.
- Intrinsic​ ​motivation:​ ​Occurs​ ​when​ ​people​ ​engage​ ​in​ ​an​ ​activity​ ​out​ ​of​ ​their​ ​own​ ​desire.​ ​The​ ​person
might​ ​find​ ​it​ ​to​ ​be​ ​challenging,​ ​stimulating​ ​or​ ​fun.​ ​Intrinsic​ ​motivation​ ​may​ ​also​ ​occur​ ​due​ ​to​ ​a​ ​want
to​ ​please​ ​others.
2.4​ ​Motivation
- Extrinsic​ ​motivation:​ ​Occurs​ ​when​ ​people​ ​participate​ ​in​ ​an​ ​activity​ ​because​ ​of​ ​the​ ​benefits​ ​and
rewards​ ​associated​ ​with​ ​doing​ ​so.​ ​They​ ​may​ ​be​ ​tangible​ ​or​ ​intangible.​ ​It​ ​can​ ​also​ ​arise​ ​from
organizational​ ​cultures​ ​that​ ​use​ ​pressure​ ​or​ ​threats.

Cultural​ ​norms​ ​also​ ​have​ ​an​ ​impact​ ​on​ ​how​ ​people​ ​are​ ​motivated.​ ​Some​ ​people​ ​are​ ​better​ ​suited​ ​to​ ​a
system​ ​of​ ​scientific​ ​management​ ​whereas​ ​others​ ​are​ ​not.

Managers​ ​must​ ​weigh​ ​up​ ​the​ ​costs​ ​of​ ​using​ ​various​ ​methods​ ​of​ ​motivation​ ​-​ ​with​ ​the​ ​expected​ ​benefits.
2.5​ ​Organizational​ ​/​ ​Corporate​ ​Culture
Organizational​ ​Culture
Organizational​ ​Culture
Culture:​ ​What​ ​is​ ​considered​ ​‘normal’​ ​to​ ​an​ ​organization,​ ​the​ ​way​ ​that​ ​workers​ ​behave​ ​within​ ​the​ ​business.​ ​Ot​ ​is
generally​ ​based​ ​on​ ​the​ ​beliefs,​ ​values​ ​and​ ​attitudes​ ​of​ ​the​ ​management​ ​and​ ​employees.​ ​Represents​ ​the​ ​character​ ​or
personality​ ​of​ ​an​ ​organization.
- Includes:​ ​punctuality,​ ​dress​ ​code,​ ​acceptability​ ​of​ ​smoking

Elements​ ​of​ ​Organizational​ ​Culture

Elements​ ​of​ ​Organizational​ ​Culture
The​ ​interrelated​ ​determinants​ ​of​ ​organizational​ ​culture:​ ​NORMS
N​ature​ ​of​ ​the​ ​Business:​ ​Culture​ ​can​ ​be​ ​shaped​ ​by​ ​the​ ​purpose​ ​and​ ​direction​ ​of​ ​an​ ​organization​ ​-
from​ ​its​ ​mission,​ ​aims​ ​and​ ​objectives.

O​rganizational​ ​Structure:​ ​Organizations​ ​with​ ​highly​ ​creative/intelligent​ ​employees​ ​will​ ​have​ ​a

different​ ​culture​ ​to​ ​organizations​ ​with​ ​low​ ​skilled​ ​staff​ ​with​ ​no​ ​input​ ​in​ ​decision​ ​making.​ ​The
flatness/tallness​ ​of​ ​an​ ​organization​ ​will​ ​also​ ​have​ ​an​ ​impact​ ​on​ ​their​ ​teamwork​ ​and​ ​thus​ ​the​ ​culture.

R​ewards:​ ​If​ ​employees​ ​are​ ​appropriately​ ​remunerated​ ​for​ ​their​ ​efforts​ ​-​ ​they​ ​are​ ​more​ ​likely​ ​to
develop​ ​a​ ​united​ ​and​ ​motivated​ ​culture.

M​anagement​ ​Styles:​ ​The​ ​management​ ​style​ ​of​ ​very​ ​controlling​ ​and​ ​‘watching​ ​every​ ​move’​ ​or​ ​giving
a​ ​long​ ​leash​ ​with​ ​lots​ ​of​ ​freedom​ ​will​ ​impact​ ​how​ ​the​ ​culture​ ​develops.

S​anctions:​ ​An​ ​organization​ ​with​ ​too​ ​few​ ​rules​ ​can​ ​inspire​ ​a​ ​culture​ ​of​ ​slack,​ ​however,​ ​a​ ​organization
with​ ​too​ ​many​ ​rules​ ​can​ ​inspire​ ​a​ ​culture​ ​of​ ​resentment​ ​for​ ​management.

The​ ​Importance​ ​of​ ​Understanding​ ​Organizational​ ​Culture

Cultural​ ​Intelligence​:​ ​Also​ ​known​ ​as,​ ​cultural​ ​quotient,​ ​is​ ​the​ ​ability​ ​of​ ​an​ ​individual​ ​to​ ​blend​ ​into
occupational,​ ​corporate​ ​and​ ​national​ ​cultures.

The​ ​strength​ ​of​ ​an​ ​organization's​ ​culture​ ​depends​ ​on​ ​its​ ​degree​ ​of​ ​unity​ ​among​ ​workers​ ​-​ ​when​ ​there​ ​is
unity​ ​it​ ​leads​ ​to​ ​a​ ​strong​ ​belief​ ​in​ ​the​ ​vision​ ​and​ ​mission​ ​of​ ​an​ ​organization.

Advantages​ ​of​ ​a​ ​strong​ ​organizational​ ​culture:

→​ ​Creates​ ​a​ ​sense​ ​of​ ​belonging​ ​and​ ​security​ ​for​ ​workforce​ ​-​ ​improves​ ​teamwork​ ​and​ ​raises​ ​motivation
→​ ​Reduces​ ​mistakes​ ​and​ ​misunderstandings​ ​as​ ​staff​ ​are​ ​familiar​ ​with​ ​the​ ​processes​ ​at​ ​work
→​ ​Minimizes​ ​problems​ ​associated​ ​with​ ​culture​ ​gap​ ​so​ ​that​ ​conflict​ ​is​ ​avoided.

Types​ ​of​ ​Organizational​ ​Culture

Types​ ​of​ ​Organizational​ ​Culture

Edgar​ ​H.​ ​Schein:​ ​Believes​ ​in​ ​there​ ​being​ ​three​ ​levels​ ​of​ ​corporate​ ​culture:
Artefacts:​ ​Superficial​ ​and​ ​behavioural​ ​aspects​ ​that​ ​are​ ​easily​ ​seen​ ​but​ ​not​ ​easy​ ​to​ ​understand.
Ex.​ ​Organizational​ ​history,​ ​facilities,​ ​dress​ ​code,​ ​how​ ​people​ ​interact
2.5​ ​Organizational​ ​/​ ​Corporate​ ​Culture
Espoused​ ​Values:​ ​The​ ​desired​ ​or​ ​expected​ ​corporate​ ​culture.​ ​The​ ​values​ ​that​ ​the​ ​organization​ ​feels
are​ ​important.​ ​Metaphors​ ​of​ ​symbols​ ​used​ ​to​ ​express​ ​the​ ​culture​ ​among​ ​staff.
Ex.​ ​Mission​ ​statement,​ ​brands,​ ​slogans

Shared​ ​Basic​ ​Assumptions:​ ​The​ ​deepest​ ​level​ ​of​ ​culture,​ ​the​ ​part​ ​which​ ​is​ ​unseen​ ​and​ ​not​ ​easily
identified.​ ​Reveals​ ​the​ ​actual​ ​values​ ​demonstrated​ ​through​ ​behaviour.​ ​Includes​ ​subcultures.​ ​This​ ​is
generally​ ​the​ ​level​ ​of​ ​culture​ ​which​ ​drives​ ​an​ ​organization

Charles​ ​Handy:​ ​Believed​ ​that​ ​different​ ​cultures​ ​were​ ​needed​ ​for​ ​different​ ​business​ ​activities.​ ​Believed​ ​in
four​ ​different​ ​types​ ​of​ ​organizational​ ​culture:
Power​ ​Culture​:​ ​Exists​ ​when​ ​there​ ​is​ ​a​ ​dominant​ ​individual​ ​or​ ​group​ ​holding​ ​decision-making​ ​power.
Generally​ ​exists​ ​in​ ​organizations​ ​with​ ​a​ ​flat​ ​structure​ ​and​ ​wide​ ​span​ ​of​ ​control.​ ​Decision​ ​making​ ​is
very​ ​swift​ ​and​ ​there​ ​is​ ​little​ ​bureaucracy.
Ex.​ ​When​ ​there’s​ ​parking​ ​spaces/private​ ​toilets​ ​for​ ​senior​ ​executives

Role​ ​Cultures:​ ​Exist​ ​in​ ​highly​ ​structured​ ​organizations​ ​with​ ​formal​ ​rules​ ​and​ ​procedures.​ ​Jobs​ ​are
clearly​ ​stated​ ​in​ ​formal​ ​job​ ​descriptions​ ​and​ ​their​ ​is​ ​clear​ ​accountability.
Ex.​ ​Often​ ​found​ ​in​ ​schools​ ​and​ ​colleges

Task​ ​Cultures:​ ​Exists​ ​in​ ​organizations​ ​where​ ​the​ ​focus​ ​is​ ​on​ ​getting​ ​the​ ​work​ ​done.​ ​There​ ​is​ ​no​ ​single
source​ ​of​ ​power​ ​and​ ​individuals/teams​ ​are​ ​empowered​ ​to​ ​have​ ​discretion​ ​over​ ​their
responsibilities.​ ​Promote​ ​problem​ ​solving​ ​through​ ​flexible​ ​and​ ​dynamic​ ​teams.

Person​ ​Cultures:​ ​Exists​ ​in​ ​organizations​ ​when​ ​staff​ ​in​ ​similar​ ​positions​ ​with​ ​similar​ ​expertise​ ​form
groups​ ​to​ ​share​ ​their​ ​knowledge​ ​and​ ​skills.​ ​Found​ ​in​ ​organizations​ ​with​ ​different​ ​branches.​ ​Exist​ ​for
the​ ​benefit​ ​of​ ​the​ ​individual​ ​involved​ ​although​ ​the​ ​business​ ​indirectly​ ​benefits​ ​from​ ​the​ ​creativity.
Ex.​ ​Commercial​ ​retailing,​ ​accountants,​ ​lawyers

Deal​ ​and​ ​Kennedy:​ ​Described​ ​corporate​ ​culture​ ​as​ ​a​ ​way​ ​to​ ​get​ ​things​ ​done​ ​within​ ​an​ ​organization.​ ​Their
research​ ​was​ ​based​ ​on​ ​a​ ​two​ ​dimensional​ ​framework.

Feedback​ ​&​ ​Reward:​ ​Analyses​ ​the​ ​speed​ ​of​ ​feedback​ ​and​ ​the​ ​level​ ​of​ ​reward​ ​within​ ​an​ ​organization.
Believed​ ​that​ ​if​ ​feedback​ ​and​ ​rewards​ ​were​ ​rapid​ ​you​ ​could​ ​lead​ ​to​ ​a​ ​consistent​ ​corporate​ ​culture.

Risk:​ ​Refers​ ​to​ ​the​ ​degree​ ​of​ ​uncertainty​ ​and​ ​level​ ​of​ ​risk​ ​taking​ ​within​ ​an​ ​organization.​ ​Risk​ ​can​ ​drive
workers​ ​or​ ​demotivate​ ​them.

Believed​ ​there​ ​was​ ​four​ ​types​ ​of​ ​organizational​ ​culture:

Work-hard,​ ​Play-hard​ ​Culture:​ ​Typical​ ​in​ ​large​ ​organizations​ ​and​ ​in​ ​fast​ ​paced​ ​customer​ ​oriented​ ​business
(restaurants​ ​/​ ​hotels).​ ​Stress​ ​is​ ​more​ ​likely​ ​to​ ​come​ ​from​ ​the​ ​scope/pace​ ​of​ ​the​ ​work​ ​as​ ​opposed​ ​to​ ​the​ ​risk

Tough-guy​ ​Macho​ ​Culture:​ ​Often​ ​applies​ ​to​ ​fast-paced​ ​organizations​ ​such​ ​as​ ​stock​ ​exchanges,​ ​professional
sports​ ​clubs​ ​or​ ​police​ ​force.​ ​It​ ​can​ ​be​ ​highly​ ​stressful​ ​due​ ​to​ ​the​ ​high​ ​risks.
2.5​ ​Organizational​ ​/​ ​Corporate​ ​Culture
Process:​ ​Bureaucracy​ ​exists​ ​and​ ​people​ ​get​ ​caught​ ​up​ ​with
how​ ​things​ ​are​ ​done​ ​as​ ​opposed​ ​to​ ​what​ ​should​ ​be​ ​done.
Often​ ​applies​ ​to​ ​government​ ​departments​ ​and​ ​insurance
companies.

Bet​ ​Your​ ​Company:​ ​Often​ ​occurs​ ​in​ ​companies​ ​where​ ​it​ ​can
take​ ​many​ ​years​ ​before​ ​getting​ ​results​ ​such​ ​as​ ​oil​ ​exploration
or​ ​pharmaceutical.​ ​It​ ​can​ ​be​ ​stressful​ ​as​ ​there​ ​is​ ​high​ ​risk​ ​and
uncertainty.

Kotter​ ​and​ ​Heskett​:​ ​Suggested​ ​that​ ​there​ ​are​ ​two​ ​types​ ​of​ ​corporate​ ​culture:
Adaptive​ ​Cultures:​ ​Cultures​ ​which​ ​are​ ​receptive​ ​to​ ​change.​ ​They​ ​generally​ ​exist​ ​in​ ​organizations​ ​that
adapt​ ​themselves​ ​to​ ​change.​ ​Staff​ ​and​ ​management​ ​are​ ​encouraged​ ​to​ ​be​ ​entrepreneurial​ ​and​ ​take
risks​ ​without​ ​the​ ​culture​ ​of​ ​blame.
Ex.​ ​Google

Inert​ ​Cultures:​ ​Cultures​ ​which​ ​are​ ​resistant​ ​to​ ​change​ ​and​ ​inward​ ​looking.​ ​They​ ​promote​ ​disinterest
and​ ​opposition​ ​as​ ​opposed​ ​to​ ​being​ ​proactive​ ​to​ ​changes​ ​in​ ​the​ ​business​ ​environment.

Goffee​ ​and​ ​Jones:​ ​Devised​ ​the​ ​double​ ​S​ ​model​ ​of​ ​organizational​ ​culture.​ ​They​ ​believed​ ​that​ ​the​ ​ideal
culture​ ​has​ ​both​ ​high​ ​sociability​ ​and​ ​high​ ​solidarity.
Sociability:​ ​Refers​ ​to​ ​the​ ​extent​ ​to​ ​which​ ​people​ ​have​ ​concerns​ ​for​ ​their​ ​colleagues.​ ​Tends​ ​to​ ​focus
on​ ​people​ ​where​ ​as​ ​low​ ​sociability​ ​places​ ​greater​ ​focus​ ​on​ ​completing​ ​tasks

Solidarity:​ ​Refers​ ​to​ ​the​ ​degree​ ​of​ ​unity​ ​in​ ​an​ ​organization.​ ​Weather​ ​people​ ​share​ ​the​ ​same​ ​values
and​ ​have​ ​common​ ​interest.​ ​High​ ​solidarity​ ​helps​ ​to​ ​promote​ ​harmony​ ​and​ ​efficiency.​ ​Low​ ​solidarity
can​ ​lead​ ​to​ ​self-interest​ ​taking​ ​priority.

Geert​ ​Hofstede:​ ​Studied​ ​the​ ​links​ ​between​ ​organizational​ ​cultures​ ​and​ ​international​ ​cultures.​ ​He​ ​believed
in​ ​five​ ​types​ ​of​ ​culture:
Power​ ​Distance:​ ​Measures​ ​the​ ​extent​ ​to​ ​which​ ​subordinates​ ​expect​ ​and​ ​accept​ ​unequal​ ​distribution
of​ ​power​ ​within​ ​the​ ​organization.​ ​High​ ​power​ ​distance​ ​cultures​ ​tend​ ​to​ ​have​ ​centralized​ ​decision
making,​ ​whereas​ ​low​ ​power​ ​distance​ ​have​ ​decentralization,​ ​delegation​ ​and​ ​empowerment.

Individualism​ ​versus​ ​Collectivism:​ ​Measures​ ​the​ ​extent​ ​to​ ​which​ ​people​ ​feel​ ​they​ ​should​ ​care​ ​for
themselves​ ​or​ ​be​ ​cared​ ​for​ ​by​ ​the​ ​society.​ ​Measures​ ​the​ ​extent​ ​to​ ​which​ ​people​ ​feel​ ​it’s​ ​their
responsibility​ ​to​ ​look​ ​after​ ​others

Masculinity​ ​versus​ ​Femininity:​ ​Focuses​ ​on​ ​the​ ​extent​ ​to​ ​which​ ​a​ ​culture​ ​conforms​ ​to​ ​traditional
gender​ ​values.
2.5​ ​Organizational​ ​/​ ​Corporate​ ​Culture
Uncertainty​ ​Avoidance:​ ​Measures​ ​the​ ​extent​ ​to​ ​which​ ​people​ ​in​ ​an​ ​organization​ ​prefer​ ​structured
routines​ ​or​ ​overflecible​ ​structures.​ ​High​ ​uncertainty​ ​avoidance​ ​have​ ​strong​ ​customs​ ​and​ ​habits,
strong​ ​rules​ ​and​ ​regulations​ ​-​ ​they​ ​tend​ ​to​ ​remain​ ​loyal​ ​to​ ​their​ ​employers.

Long-term​ ​versus​ ​Short-term​ ​ ​Orientation:​ ​The​ ​extent​ ​to​ ​which​ ​a​ ​particular​ ​culture​ ​values​ ​making
sacrifices​ ​today​ ​for​ ​benefits​ ​to​ ​be​ ​reaped​ ​in​ ​the​ ​future

National​ ​culture​ ​has​ ​a​ ​direct​ ​impact​ ​on​ ​organizational​ ​culture.​ ​Whilst​ ​one​ ​culture​ ​may​ ​be​ ​predominant​ ​in
an​ ​organization​ ​there​ ​is​ ​often​ ​other​ ​groups​ ​of​ ​subcultures.​ ​The​ ​difference​ ​between​ ​these​ ​cultures​ ​can
cause​ ​a​ ​culture​ ​gap​ ​-​ ​the​ ​difference​ ​between​ ​the​ ​desired​ ​culture​ ​of​ ​a​ ​business​ ​and​ ​the​ ​culture​ ​that​ ​actually
exists.

Cultural​ ​Clashes​ ​Within​ ​Organizations

The​ ​reasons​ ​for,​ ​and​ ​consequences​ ​of,​ ​cultural​ ​clashes​ ​within​ ​organizations​ ​when​ ​they​ ​grow,​ ​merge​ ​and
when​ ​leadership​ ​styles​ ​change
Cultural​ ​clashes​ ​exist​ ​when​ ​there​ ​is​ ​a​ ​conflict​ ​or​ ​incompatibility​ ​between​ ​two​ ​or​ ​more​ ​cultures​ ​within​ ​an
organization.​ ​This​ ​can​ ​happen​ ​when​ ​firms​ ​merge,​ ​expands​ ​or​ ​when​ ​there​ ​is​ ​a​ ​change​ ​in​ ​leadership.
Conflict:​ ​disagreements​ ​that​ ​result​ ​from​ ​differences​ ​in​ ​the​ ​attitudes,​ ​beliefs,​ ​values​ ​or​ ​needs​ ​of​ ​people.

Reasons​ ​for​ ​Organizational​ ​Cultural​ ​Clashes

Growth​ ​of​ ​Firms​:​ ​The​ ​internal​ ​growth​ ​can​ ​lead​ ​to​ ​more​ ​hierarchical​ ​organizational​ ​structure​ ​which​ ​can
result​ ​in​ ​organizations​ ​becoming​ ​bureaucratic.​ ​Cultural​ ​clashes​ ​often​ ​occur​ ​when​ ​businesses​ ​expand​ ​into
overseas​ ​markets.

Mergers​ ​and​ ​Acquisitions​:​ ​Organizational​ ​cultures​ ​can​ ​clash​ ​or​ ​change​ ​when​ ​there​ ​is​ ​external​ ​growth.
Mergers​ ​can​ ​fail​ ​due​ ​to​ ​cultural​ ​clashes.​ ​Those​ ​who​ ​can’t​ ​adapt​ ​to​ ​the​ ​new​ ​culture​ ​are​ ​likely​ ​to​ ​leave​ ​the
organization.

Change​ ​in​ ​Leadership​:​ ​Change​ ​in​ ​a​ ​leadership​ ​can​ ​easily​ ​result​ ​in​ ​a​ ​change​ ​in​ ​the​ ​organizational​ ​culture.
Leaders​ ​drive​ ​the​ ​strategic​ ​direction​ ​of​ ​the​ ​organization​ ​so​ ​a​ ​change​ ​in​ ​the​ ​leadership​ ​team​ ​can​ ​result​ ​in
culture​ ​clashes.

Consequences​ ​of​ ​Organizational​ ​Cultural​ ​Clashes

Misunderstandings​ ​and​ ​Miscommunications:​ ​Cultural​ ​clashes​ ​and​ ​culture​ ​gaps​ ​often​ ​result​ ​in​ ​problems​ ​due
to​ ​employees​ ​not​ ​understanding​ ​the​ ​reasons​ ​for​ ​change​ ​or​ ​if​ ​these​ ​have​ ​not​ ​been​ ​communicated
effectively​ ​with​ ​the​ ​workers.

Unhappy​ ​Staff:​ ​Cultural​ ​clashes​ ​have​ ​the​ ​potential​ ​to​ ​make​ ​people​ ​unhappy

Compromises​ ​Must​ ​Be​ ​Reached:​ ​In​ ​order​ ​for​ ​the​ ​business​ ​to​ ​move​ ​forward​ ​conflict​ ​needs​ ​to​ ​be​ ​resolved
and​ ​compromises​ ​may​ ​need​ ​to​ ​be​ ​made.

Resistance​ ​to​ ​Change:​ ​Staff​ ​are​ ​likely​ ​to​ ​recent​ ​changes​ ​to​ ​the​ ​culture​ ​that​ ​they​ ​are​ ​used​ ​to​ ​due​ ​to​ ​the​ ​lack
of​ ​understanding​ ​of​ ​the​ ​benefits​ ​of​ ​change.
2.5​ ​Organizational​ ​/​ ​Corporate​ ​Culture
High​ ​Costs​ ​of​ ​Training​ ​Staff​ ​and​ ​Implementing​ ​Change​:​ ​Training​ ​staff​ ​may​ ​be​ ​necessary​ ​to​ ​implement​ ​new
changes
National​ ​Culture​ ​Clashes​ ​/​ ​Disputes:​ ​ ​National​ ​cultures​ ​may​ ​be​ ​so​ ​strong​ ​that​ ​attempts​ ​to​ ​change​ ​culture
may​ ​fail.​ ​Example,​ ​expansion​ ​to​ ​some​ ​countries​ ​may​ ​not​ ​work​ ​as​ ​concepts​ ​such​ ​as​ ​females​ ​in​ ​the​ ​workplace
are​ ​not​ ​quite​ ​as​ ​progressed.

Individuals​ ​and​ ​Organizational​ ​Culture

How​ ​individuals​ ​influence​ ​organizational​ ​culture​ ​and​ ​how​ ​organizational​ ​culture​ ​influences​ ​individuals
Individuals​ ​-​ ​usually​ ​leaders​ ​-​ ​can​ ​have​ ​a​ ​large​ ​impact​ ​on​ ​organizational​ ​culture.​ ​The​ ​qualities​ ​of​ ​effective​ ​leaders
(vision,​ ​interpersonal​ ​skills)​ ​help​ ​to​ ​shape​ ​the​ ​desired​ ​corporate​ ​culture.​ ​ ​At​ ​the​ ​same​ ​time​ ​-​ ​the​ ​unique​ ​element​ ​of
any​ ​organizational​ ​culture​ ​is​ ​it’s​ ​diversity​ ​-​ ​the​ ​variety​ ​of​ ​ethnicities,​ ​languages,​ ​gender​ ​and​ ​socioeconomic​ ​groups
within​ ​a​ ​business.

A​ ​strong​ ​culture​ ​can​ ​be​ ​shaped​ ​by​ ​a​ ​single​ ​influential​ ​leader​ ​such​ ​as​ ​a​ ​CEO​ ​of​ ​a​ ​company​ ​of​ ​a​ ​principle​ ​of​ ​a​ ​school.
The​ ​challenge​ ​is​ ​for​ ​leaders​ ​to​ ​influence​ ​people​ ​within​ ​an​ ​organization​ ​to​ ​follow​ ​or​ ​shape​ ​a​ ​shared​ ​vision​ ​and
corporate​ ​culture.
Strategies​ ​to​ ​do​ ​this​ ​=​ ​MOVER
M​entor:​ ​Leaders​ ​act​ ​as​ ​mentors​ ​by​ ​sharing​ ​knowledge​ ​and​ ​expertise​ ​and​ ​supporting​ ​their​ ​people​ ​and
building​ ​trust
O​utreach:​ ​Communicating​ ​the​ ​desired​ ​culture​ ​to​ ​all​ ​members​ ​of​ ​the​ ​organization
V​ision:​ ​Having​ ​a​ ​firm​ ​belief​ ​in​ ​where​ ​the​ ​business​ ​wants​ ​to​ ​be​ ​so​ ​it​ ​can​ ​successfully​ ​lead​ ​people​ ​there
E​ngaging:​ ​The​ ​desired​ ​corporate​ ​culture​ ​should​ ​engage​ ​and​ ​excite​ ​workers
R​ole​ ​Modelling​:​ ​Leaders​ ​must​ ​lead​ ​by​ ​example​ ​to​ ​drive​ ​and​ ​develop​ ​the​ ​desired​ ​culture

Organizational​ ​Culture​ ​has​ ​an​ ​effect​ ​on​ ​and​ ​is​ ​intertwined​ ​all​ ​facets​ ​of​ ​business​ ​activity​ ​including;
- A​ ​business's​ ​approach​ ​to​ ​ethical​ ​business​ ​behaviour
- The​ ​centralization/decentralization​ ​of​ ​decision​ ​making
- The​ ​span​ ​of​ ​control
- The​ ​level​ ​of​ ​innovation
- The​ ​morale​ ​of​ ​employees

Organizational​ ​culture​ ​has​ ​a​ ​DIRECT​ ​influence​ ​on​ ​individuals.

2.6​ ​Employer​ ​and​ ​Employee​ ​Relations
Employee​ ​and​ ​Employer​ ​Representatives
The​ ​role​ ​and​ ​responsibility​ ​of​ ​employee​ ​and​ ​employer​ ​representative
Managers​ ​usually​ ​strive​ ​to​ ​ensure​ ​that​ ​there​ ​are​ ​good​ ​working​ ​relationships​ ​at​ ​work.
- Poor​ ​working​ ​relationships​ ​→​ ​low​ ​morale,conflict​ ​,​ ​industrial​ ​unrest

Reasons​ ​for​ ​Industrial​ ​Unrest​ ​To​ ​Occur:​ ​Workers​ ​are​ ​dissatisfied​ ​by​ ​pay​ ​/​ ​by​ ​working​ ​conditions

Employee/Employer​ ​Representatives:​​ ​Individuals​ ​or​ ​organizations​ ​that​ ​represent​ ​the​ ​management​ ​team​ ​in​ ​the
collective​ ​bargaining​ ​process.​​ ​Deal​ ​with​ ​the​ ​sources​ ​of​ ​disputes​ ​on​ ​behalf​ ​of​ ​their​ ​members​ ​and​ ​try​ ​to​ ​resolve​ ​the
conflict.
- Used​ ​when​ ​the​ ​individuals​ ​don’t​ ​want​ ​to​ ​negotiate​ ​so​ ​they​ ​use​ ​‘agents’​ ​such​ ​as​ ​lawyers​ ​or​ ​trade​ ​union
representatives​ ​to​ ​act​ ​on​ ​their​ ​behalf.

Employer​ ​Associations:​​ ​Organizations​ ​that​ ​represent​ ​the​ ​general​ ​views​ ​and​ ​interests​ ​of​ ​all​ ​businesses​ ​within​ ​a
certain​ ​industry​ ​by​ ​negotiating​ ​with​ ​unions​ ​and​ ​influencing​ ​government​ ​action.

Negation:​ ​A​ ​bargaining​ ​process​ ​whereby​ ​two​ ​or​ ​more​ ​parties​ ​attempt​ ​to​ ​achieve​ ​a​ ​mutually​ ​acceptable​ ​result.
- Negotiations​ ​tend​ ​to​ ​focus​ ​on​ ​the​ ​terms​ ​and​ ​conditions​ ​of​ ​employment​ ​such​ ​as​ ​wages,​ ​hours​ ​of​ ​work​ ​and
working​ ​conditions.
- Ultimate​ ​goal​ ​is​ ​a​ ​win​ ​win​ ​situation​ ​for​ ​both​ ​parties

Trade​ ​Union​ ​(Labour​ ​Union):​ ​An​ ​organization​ ​whose​ ​members​ ​unite​ ​to​ ​protect​ ​their​ ​rights​ ​and​ ​welfare.
- A​ ​union​ ​is​ ​likely​ ​to​ ​have​ ​more​ ​bargaining​ ​power​ ​than​ ​an​ ​individual​ ​as​ ​there’s​ ​strength​ ​in​ ​numbers
- From​ ​the​ ​employers​ ​perspective​ ​it’s​ ​ ​cheaper​ ​and​ ​quicker​ ​to​ ​bargain​ ​with​ ​one​ ​trade​ ​union​ ​representative
than​ ​with​ ​many​ ​individual​ ​workers
- Members​ ​of​ ​trade​ ​unions​ ​have​ ​to​ ​pay​ ​an​ ​annual​ ​fee​ ​to​ ​contribute​ ​towards​ ​the​ ​cost​ ​of​ ​running​ ​the​ ​union
- Membership​ ​fees​ ​cover​ ​the​ ​cost​ ​of​ ​legal​ ​advice​ ​and​ ​representation
- They​ ​also​ ​persuade​ ​governments​ ​to​ ​pass​ ​legislation​ ​in​ ​favor​ ​of​ ​their​ ​workers

Types​ ​of​ ​Labour​ ​Unions

Craft​ ​Unions:​ ​The​ ​original​ ​labour​ ​unions​ ​where​ ​members​ ​shared​ ​a​ ​particular​ ​skill​ ​or​ ​craft
Industrial​ ​Unions:​ ​These​ ​unions​ ​accept​ ​members​ ​from​ ​the​ ​same​ ​industry,​ ​irrespective​ ​of​ ​their​ ​skills,
qualifications,​ ​ranking​ ​or​ ​the​ ​nature​ ​of​ ​their​ ​work.
General​ ​Unions:​ ​Unions​ ​which​ ​accept​ ​members​ ​from​ ​any​ ​industry​ ​regardless​ ​of​ ​skills​ ​or​ ​qualifications​ ​-​ ​thus
they​ ​have​ ​a​ ​very​ ​large​ ​membership.
White-Collar​ ​Unions:​ ​These​ ​unions​ ​admit​ ​non-manual​ ​workers​ ​and​ ​exist​ ​in​ ​professions​ ​like​ ​teaching​ ​and
banking.

Main​ ​Issues​ ​That​ ​a​ ​Labour​ ​Union​ ​Deals​ ​With

→​ ​Negotiating​ ​with​ ​employers​ ​for​ ​increased​ ​pay​ ​and​ ​benefits
→​ ​Improving​ ​the​ ​conditions​ ​of​ ​work​ ​for​ ​their​ ​members
→​ ​Supporting​ ​members​ ​with​ ​necessary​ ​legal​ ​advice
→​ ​Providing​ ​financial​ ​support​ ​and​ ​legal​ ​advice​ ​to​ ​members​ ​who​ ​might​ ​have​ ​been​ ​unfairly​ ​dismissed​ ​or​ ​made
redundant
→​ ​Upholding​ ​the​ ​rights​ ​of​ ​their​ ​members​ ​to​ ​have​ ​professional​ ​training​ ​and​ ​development
→​ ​Pressuring​ ​employers​ ​to​ ​ensure​ ​that​ ​equipment​ ​and​ ​machinery​ ​at​ ​work​ ​are​ ​safe​ ​to​ ​use

The​ ​outcome​ ​of​ ​negotiations​ ​depends​ ​on​ ​the​ ​bargaining​ ​strength​ ​of​ ​employers/employees​ ​which​ ​depends​ ​on:
- The​ ​level​ ​of​ ​experience​ ​and​ ​skills​ ​of​ ​the​ ​negotiators
- The​ ​number​ ​of​ ​members​ ​and​ ​the​ ​degree​ ​of​ ​unity​ ​within​ ​the​ ​trade​ ​union
- The​ ​state​ ​of​ ​the​ ​economy
2.6​ ​Employer​ ​and​ ​Employee​ ​Relations
- Demand​ ​of​ ​product,​ ​as​ ​demand​ ​for​ ​labour​ ​is​ ​derived​ ​from​ ​this
- The​ ​degree​ ​of​ ​substitution​ ​between​ ​labour​ ​and​ ​capital​ ​(how​ ​much​ ​the​ ​labour​ ​benefits​ ​the​ ​firm)
- Public​ ​and​ ​media​ ​opinion
- Government​ ​involvement

Labour​ ​unions​ ​have​ ​become​ ​increasingly​ ​unpopular.​ ​Government​ ​rules​ ​have​ ​restricted​ ​their​ ​power​ ​and​ ​there​ ​has
been​ ​a​ ​rise​ ​in​ ​part​ ​time​ ​workers.
- In​ ​response​ ​to​ ​this​ ​there​ ​has​ ​been​ ​a​ ​rise​ ​in​ ​staff​ ​associations​.​ ​These​ ​have​ ​similar​ ​roles​ ​to​ ​trade​ ​unions​ ​except
that​ ​they​ ​operate​ ​only​ ​within​ ​a​ ​singular​ ​organization.​ ​Although​ ​their​ ​bargaining​ ​strength​ ​is​ ​significantly​ ​less.

Industrial/Employee​ ​Relations​ ​Methods​ ​Used​ ​By​ ​Employees

The​ ​following​ ​industrial/employee​ ​relations​ ​methods​ ​used​ ​by​ ​employees:​ ​collective​ ​bargaining,
slowdown/go-slows,​ ​work​ ​to-rule,​ ​overtime​ ​bans​ ​and​ ​strike​ ​action.

Collective​ ​Bargaining:​ ​The​ ​process​ ​by​ ​which​ ​pay​ ​and​ ​conditions​ ​of​ ​work​ ​are​ ​settled​ ​by​ ​negotiations​ ​between
employers​ ​and​ ​employees​ ​or​ ​by​ ​their​ ​respective​ ​representations.​ ​Decisions​ ​are​ ​made​ ​for​ ​a​ ​large​ ​group​ ​of​ ​employees
rather​ ​than​ ​a​ ​single​ ​individual.
- Senior​ ​managers​ ​are​ ​more​ ​pressured​ ​to​ ​listen​ ​to​ ​the​ ​views​ ​of​ ​workers

Go-Slows​ ​(Slowdowns)​ ​:​ ​Where​ ​employees​ ​work​ ​at​ ​the​ ​minimum​ ​pace​ ​allowable​ ​in​ ​their​ ​employment​ ​contract.​ ​This
reduces​ ​productivity​ ​yet​ ​employers​ ​can’t​ ​discipline​ ​staff​ ​who​ ​work​ ​slowly​ ​but​ ​at​ ​a​ ​contract​ ​acceptable​ ​rate.​ ​Overtime
work​ ​is​ ​also​ ​avoided.
- Highly​ ​effective​ ​in​ ​firms​ ​with​ ​imminent​ ​deadlines​ ​or​ ​during​ ​periods​ ​of​ ​high​ ​seasonal​ ​demand

Work-to-rule:​ ​Where​ ​employees​ ​do​ ​the​ ​absolute​ ​minimum​ ​required​ ​according​ ​to​ ​the​ ​rules​ ​set​ ​by​ ​the​ ​employer.
Workers​ ​adhere​ ​precisely​ ​to​ ​rules​ ​and​ ​regulation​ ​to​ ​delay​ ​production​ ​and​ ​decrease​ ​productivity.
- This​ ​is​ ​considered​ ​less​ ​disruptive​ ​than​ ​a​ ​strike​ ​and​ ​employers​ ​similarly​ ​can’t​ ​discipline​ ​staff

Overtime​ ​Bans:​ ​Where​ ​a​ ​labour​ ​union​ ​directs​ ​for​ ​members​ ​to​ ​disengage​ ​in​ ​any​ ​overtime​ ​activity.​ ​This​ ​causes
disruptions​ ​to​ ​business​ ​activity.
- Also​ ​effective​ ​in​ ​firms​ ​with​ ​peak​ ​seasons

Strike​ ​Action​:​ ​The​ ​collective​ ​refusal​ ​of​ ​employees​ ​to​ ​work.​ ​Usually​ ​the​ ​result​ ​of​ ​major​ ​industrial​ ​unrest.​ ​It​ ​is​ ​only
official​ ​if​ ​it​ ​has​ ​the​ ​backing​ ​of​ ​the​ ​majority​ ​of​ ​the​ ​members​ ​of​ ​the​ ​trade​ ​union.​ ​The​ ​union​ ​generally​ ​gives​ ​notice​ ​to​ ​the
management​ ​of​ ​the​ ​intent​ ​to​ ​strike.​ ​Often​ ​the​ ​management​ ​considers​ ​re-negotiation​ ​in​ ​order​ ​to​ ​avoid​ ​strike​ ​action.
- A​ ​variation​ ​of​ ​a​ ​strike​ ​is​ ​a​ ​walkout​​ ​where​ ​employees​ ​independently​ ​or​ ​collectively​ ​walk​ ​out​ ​of​ ​their​ ​place​ ​of
work​ ​as​ ​a​ ​sign​ ​of​ ​protest​ ​or​ ​disapproval.

Industrial/Employee​ ​Relations​ ​Methods​ ​Used​ ​By​ ​Employers

The​ ​following​ ​industrial/employee​ ​relations​ ​methods​ ​used​ ​by​ ​employers:​ ​collective​ ​bargaining,​ ​threats​ ​of
redundancies,​ ​changes​ ​of​ ​contract,​ ​closure​ ​and​ ​lock​ ​outs
Employer​ ​Objectives:
★ Lower​ ​production​ ​costs​ ​to​ ​remain​ ​competitive
★ Improve​ ​productivity​ ​levels
★ Lower​ ​rates​ ​of​ ​absenteeism
★ Higher​ ​staff​ ​retention

Collective​ ​Bargaining:​ ​It​ ​doesn’t​ ​require​ ​the​ ​involvement​ ​of​ ​third​ ​parties​ ​to​ ​establish​ ​a​ ​win-win​ ​situation.​ ​Skilled
negotiators​ ​representing​ ​the​ ​employers​ ​often​ ​use​ ​short​ ​deadlines​ ​as​ ​a​ ​tactic​ ​so​ ​the​ ​opposition​ ​has​ ​little​ ​tie​ ​to
prepare​ ​or​ ​fight​ ​for​ ​its​ ​case.
2.6​ ​Employer​ ​and​ ​Employee​ ​Relations
Threats​ ​of​ ​Redundancies:​ ​Some​ ​negotiators​ ​use​ ​intimidation​ ​to​ ​pressure​ ​or​ ​threaten​ ​employees.​ ​They​ ​may​ ​use​ ​the
threat​ ​of​ ​redundancies​ ​to​ ​make​ ​employees​ ​comply​ ​with​ ​their​ ​demands.

Changes​ ​of​ ​Contract:​ ​Sometimes​ ​it’s​ ​possible​ ​to​ ​legally​ ​change​ ​people’s​ ​contract​ ​of​ ​employment​ ​if​ ​administered
fairly.​ ​They​ ​may​ ​change​ ​things​ ​like​ ​the​ ​terms​ ​and​ ​conditions​ ​of​ ​pay.​ ​However-​ ​this​ ​can​ ​be​ ​seen​ ​as​ ​coercion​ ​if​ ​both
sides​ ​don’t​ ​agree.

Closure:​ ​An​ ​extreme​ ​way​ ​to​ ​deal​ ​with​ ​strike​ ​action​ ​is​ ​to​ ​close​ ​the​ ​business.​ ​This​ ​method​ ​is​ ​generally​ ​only​ ​used​ ​once
other​ ​methods​ ​have​ ​been​ ​exhausted.​ ​It​ ​may​ ​mean​ ​the​ ​workers​ ​don’t​ ​receive​ ​wages​ ​or​ ​it​ ​may​ ​mean​ ​they​ ​are​ ​made
redundant​ ​which​ ​may​ ​persuade​ ​them​ ​to​ ​want​ ​to​ ​make​ ​a​ ​compromise.

Lock-outs:​ ​When​ ​an​ ​employer​ ​temporarily​ ​stops​ ​employees​ ​from​ ​working​ ​during​ ​an​ ​industrial​ ​dispute.​ ​The​ ​business
may​ ​hire​ ​security​ ​guards​ ​or​ ​change​ ​the​ ​locks​ ​to​ ​prevent​ ​employees​ ​from​ ​entering.​ ​Employees​ ​may​ ​eventually​ ​wish​ ​to
return​ ​to​ ​work​ ​to​ ​get​ ​paid.

Conflict
Sources​ ​of​ ​conflict​ ​in​ ​the​ ​workplace
Conflict:​ ​A​ ​situation​ ​of​ ​friction​ ​or​ ​mutually​ ​exclusive​ ​goals​ ​between​ ​two​ ​or​ ​more​ ​parties.​ ​It​ ​is​ ​caused​ ​by
disagreements​ ​or​ ​incompatibilities​ ​between​ ​these​ ​groups​ ​and​ ​results​ ​in​ ​a​ ​lack​ ​of​ ​cooperation.

Sources​ ​of​ ​Conflict

Needs​ ​and​ ​Wants:​ ​Conflicts​ ​arise​ ​when​ ​people’s​ ​needs​ ​and​ ​desires​ ​are​ ​ignored.​ ​Conflicts​ ​often​ ​arise​ ​due​ ​to
differences​ ​in​ ​opinions​ ​over​ ​rates​ ​of​ ​pay​ ​and​ ​working​ ​conditions.

Perceptions:​ ​Different​ ​people​ ​interpret​ ​things​ ​differently​ ​and​ ​misunderstandings/misperceptions​ ​can​ ​easily
lead​ ​to​ ​conflict.​ ​Effective​ ​communication​ ​is​ ​needed​ ​to​ ​unite​ ​perceptions​ ​so​ ​conflict​ ​is​ ​minimized.

Values:​ ​Conflict​ ​arises​ ​when​ ​people​ ​hold​ ​incompatible​ ​beliefs,​ ​values​ ​or​ ​principles.​ ​If​ ​people​ ​are​ ​unwilling
to​ ​compromise​ ​-​ ​it​ ​makes​ ​the​ ​management​ ​of​ ​a​ ​conflict​ ​very​ ​challenging.

Power:​ ​Conflict​ ​arises​ ​when​ ​people​ ​in​ ​a​ ​position​ ​of​ ​power​ ​try​ ​to​ ​make​ ​others​ ​do​ ​something​ ​against​ ​their
will​ ​or​ ​benefit.​ ​The​ ​unfair​ ​use​ ​of​ ​authority​ ​causes​ ​friction​ ​in​ ​the​ ​workplace.

Feelings​ ​and​ ​Emotions:​ ​Conflict​ ​often​ ​occurs​ ​because​ ​people​ ​ignore​ ​the​ ​feelings​ ​of​ ​others​ ​in​ ​the
organization.​ ​Feelings​ ​and​ ​emotions​ ​are​ ​a​ ​huge​ ​influence​ ​on​ ​how​ ​people​ ​deal​ ​with​ ​conflict.

Problems​ ​of​ ​Conflict

- Hinders​ ​productivity
- Reduces​ ​the​ ​level​ ​of​ ​staff​ ​morale​ ​due​ ​to​ ​added​ ​stress​ ​and​ ​anxieties
- Causes​ ​inappropriate​ ​conduct
- Fuels​ ​internal​ ​politics
- Hampers​ ​opportunities​ ​for​ ​collaborative​ ​teams

However,​ ​conflict​ ​is​ ​not​ ​always​ ​a​ ​negative​ ​things​ ​as​ ​often​ ​it;s​ ​needed​ ​to​ ​raise​ ​and​ ​address​ ​real​ ​problems
which​ ​are​ ​bothering​ ​people.​ ​Understanding​ ​people’s​ ​differences​ ​can​ ​help​ ​to​ ​foster​ ​better​ ​working
relationships​ ​in​ ​the​ ​future.
2.6​ ​Employer​ ​and​ ​Employee​ ​Relations
Conflict​ ​Resolution
Conflict​ ​Resolution:​ ​The​ ​course​ ​of​ ​action​ ​taken​ ​to​ ​resolve​ ​conflict​ ​and​ ​differences​ ​in​ ​opinions.​ ​It’s
successful​ ​if​ ​each​ ​parties​ ​interests​ ​are​ ​addressed​ ​resulting​ ​in​ ​satisfactory​ ​outcome​ ​for​ ​all​ ​sides.

Conciliation:​ ​Process​ ​whereby​ ​the​ ​parties​ ​involved​ ​in​ ​a​ ​dispute​ ​agree​ ​to​ ​use​ ​the​ ​services​ ​of​ ​an​ ​independent
mediator.
- The​ ​mediator​ ​meets​ ​with​ ​both​ ​parties​ ​separately​ ​(this​ ​is​ ​called​ ​caucusing)​ ​in​ ​an​ ​attempt​ ​to​ ​resolve
their​ ​disputes​ ​and​ ​differences.
- The​ ​conciliators​ ​role​ ​is​ ​to​ ​encourage​ ​the​ ​parties​ ​to​ ​negotiate​ ​and​ ​compromise.
- The​ ​parties​ ​are​ ​unlikely​ ​to​ ​actually​ ​agree​ ​so​ ​it’s​ ​important​ ​that​ ​a​ ​conciliator​ ​is​ ​highly​ ​skilled​ ​and​ ​a
good​ ​communicator.
- Generally​ ​they​ ​get​ ​their​ ​parties​ ​to​ ​agree​ ​to​ ​the​ ​decision​ ​in​ ​writing​ ​making​ ​it​ ​legally​ ​binding.

Arbitration:​ ​External​ ​entity​ ​used​ ​a​ ​part​ ​of​ ​conflict​ ​resolution​ ​-​ ​however​ ​the​ ​process​ ​involves​ ​an
independent​ ​arbitrator​ ​deciding​ ​on​ ​an​ ​appropriate​ ​outcome.
- The​ ​arbitrator​ ​acts​ ​like​ ​a​ ​judge​ ​and​ ​their​ ​decision​ ​is​ ​legally​ ​binding
- Pendulum​ ​Arbitration:​ ​An​ ​extreme​ ​version​ ​of​ ​arbitration​ ​where​ ​the​ ​arbitrator​ ​has​ ​to​ ​decide
completely​ ​in​ ​favour​ ​of​ ​one​ ​group​ ​or​ ​another.​ ​No​ ​compromise​ ​is​ ​made.

Industrial​ ​Democracy:​ ​An​ ​example​ ​of​ ​this​ ​is​ ​employee​ ​participation​ ​where​ ​employees​ ​are​ ​given
responsibilities​ ​and​ ​authority​ ​to​ ​complete​ ​tasks​ ​and​ ​are​ ​involved​ ​in​ ​the​ ​decision-making​ ​process.
- Helps​ ​to​ ​improve​ ​productivity​ ​as​ ​workers​ ​are​ ​more​ ​involved​ ​so​ ​happier
- Employers​ ​benefit​ ​from​ ​a​ ​more​ ​cooperative​ ​workforce​ ​that​ ​is​ ​less​ ​likely​ ​to​ ​engage​ ​in​ ​industrial
action

No-strike​ ​Agreements:​ ​Trade​ ​unions​ ​may​ ​decide​ ​not​ ​to​ ​allow​ ​strike​ ​action​ ​as​ ​it​ ​has​ ​negatively​ ​affected
their​ ​image.​ ​This​ ​helps​ ​the​ ​union​ ​the​ ​sustain​ ​its​ ​membership​ ​and​ ​reassure​ ​employers​ ​and​ ​other
stakeholder​ ​groups​ ​that​ ​employees​ ​won’t​ ​strike​ ​at​ ​the​ ​expense​ ​of​ ​others.

Single​ ​Union​ ​Agreements:​ ​When​ ​an​ ​organization​ ​agrees​ ​to​ ​participate​ ​in​ ​the​ ​negotiation​ ​process​ ​with​ ​a
sole​ ​labour​ ​union​ ​that​ ​represents​ ​the​ ​workers.
- Causes​ ​fewer​ ​disruptions​ ​to​ ​the​ ​employer​ ​as​ ​there​ ​is​ ​less​ ​management​ ​time​ ​and​ ​money​ ​spent
dealing​ ​with​ ​multiple​ ​inter-union​ ​disputes.

Most​ ​experts​ ​believe​ ​that​ ​making​ ​the​ ​effort​ ​to

find​ ​a​ ​mutually​ ​beneficial​ ​solution​ ​leads​ ​to​ ​the
most​ ​satisfactory​ ​result.

Resistance​ ​To​ ​Change

Reasons​ ​for​ ​resistance​ ​to​ ​change​ ​in​ ​the
workplace​ ​(such​ ​as​ ​self-interest,​ ​low​ ​tolerance
misinformation​ ​and​ ​interpretation​ ​of
circumstances).

Human​ ​resource​ ​strategies​ ​for​ ​reducing​ ​the

impact​ ​of​ ​change​ ​and​ ​resistance​ ​to​ ​change​ ​(such
2.6​ ​Employer​ ​and​ ​Employee​ ​Relations
as​ ​getting​ ​agreement/ownership,​ ​planning​ ​and​ ​timing​ ​the​ ​change​ ​and​ ​communicating​ ​the​ ​change).

One​ ​of​ ​the​ ​major​ ​barriers​ ​to​ ​effective​ ​change​ ​management​ ​is​ ​the​ ​resistance​ ​to​ ​change​ ​from​ ​the​ ​workforce.

John​ ​Paul​ ​Kotter​ ​believed​ ​there​ ​were​ ​four​ ​main​ ​reasons​ ​why​ ​people​ ​are​ ​resistant​ ​to​ ​change:
1. Self​ ​interest​ ​often​ ​takes​ ​priority​ ​over​ ​organizational​ ​objectives.
2. Low​ ​tolerance​ ​of​ ​change​ ​happens​ ​because​ ​people​ ​prefer​ ​familiarity​ ​to​ ​disruptions​ ​and
uncertainties.​ ​There​ ​may​ ​also​ ​be​ ​an​ ​element​ ​of​ ​fear​ ​from​ ​being​ ​made​ ​redundant​ ​or​ ​fear​ ​of​ ​failure​ ​in
adapting​ ​to​ ​change.
3. Misinformation​ ​causes​ ​misunderstandings​ ​if​ ​the​ ​purpose​ ​of​ ​change​ ​hasn’t​ ​been​ ​communicated
properly.
4. Different​ ​assessments​ ​of​ ​the​ ​situation​ ​occurs​ ​when​ ​there​ ​are​ ​different​ ​interpretations​ ​of
circumstances.​ ​Managers​ ​and​ ​staff​ ​might​ ​disagree​ ​on​ ​the​ ​merits​ ​and​ ​purpose​ ​of​ ​change.

There​ ​is​ ​also​ ​the​ ​issue​ ​of​ ​ambivalence​ ​-​ ​where​ ​people​ ​don’t​ ​voice​ ​their​ ​concerns​ ​for​ ​change​ ​and​ ​thus​ ​there
is​ ​an​ ​underestimation​ ​in​ ​the​ ​degree​ ​of​ ​the​ ​resistance​ ​to​ ​change.

Professor​ ​Kotter​ ​proposed​ ​the​ ​size​ ​change​ ​approaches​ ​model​ ​to​ ​deal​ ​with​ ​resistance​ ​to​ ​change:

1. Education​ ​and​ ​Communication:​ ​This​ ​approach​ ​aims​ ​to

inform​ ​sand​ ​educate​ ​staff​ ​about​ ​the​ ​change
beforehand.​ ​Early​ ​communication​ ​helps​ ​stakeholders
see​ ​the​ ​rationale​ ​for​ ​change​ ​and​ ​reduces​ ​instability.

2. Participation​ ​and​ ​Involvement:​ ​Employee​ ​involvement

in​ ​decision​ ​making​ ​can​ ​motivate​ ​and​ ​improve​ ​morale
amongst​ ​the​ ​workforce.​ ​Giving​ ​the​ ​staff​ ​a​ ​sense​ ​of
ownership​ ​of​ ​the​ ​change​ ​they​ ​are​ ​more​ ​likely​ ​to
accept​ ​the​ ​change.

3. Facilitation​ ​and​ ​Support:​ ​This​ ​approach​ ​is​ ​paternalistic

as​ ​managers​ ​become​ ​supportive​ ​of​ ​staff​ ​during
difficult​ ​times​ ​thereby​ ​avoiding​ ​resistance​ ​to​ ​change.

4. Negotiation​ ​and​ ​Agreement:​ ​Managers​ ​use​ ​incentives​ ​to​ ​remove​ ​or​ ​limit​ ​resistance​ ​to​ ​change.
Examples​ ​may​ ​be​ ​things​ ​like​ ​redundancy​ ​incentives.​ ​At​ ​other​ ​times​ ​managers​ ​may​ ​be​ ​willing​ ​to
compromise​ ​so​ ​that​ ​employees​ ​are​ ​more​ ​welcoming​ ​to​ ​change.

5. Manipulation​ ​and​ ​Co-Operation:​ ​Bringing​ ​a​ ​representative​ ​of​ ​those​ ​resisting​ ​change​ ​into​ ​the​ ​change
process.​ ​The​ ​purpose​ ​of​ ​the​ ​theory​ ​is​ ​to​ ​give​ ​the​ ​representation​ ​however,​ ​in​ ​reality​ ​it​ ​is​ ​used​ ​to
convert​ ​the​ ​representatives​ ​thinking​ ​so​ ​the​ ​advantages​ ​of​ ​change​ ​can​ ​be​ ​communicated​ ​to​ ​those
resisting​ ​change.​ ​This​ ​approach​ ​is​ ​rather​ ​unethical​ ​and​ ​can​ ​backfire.

6. Explicit​ ​and​ ​Implicit​ ​Coercion:​ ​This​ ​is​ ​generally​ ​used​ ​as​ ​a​ ​last​ ​resort.​ ​Managers​ ​use​ ​coercion​ ​to​ ​force
staff​ ​into​ ​accepting​ ​change​ ​by​ ​threatening​ ​disciplinary​ ​action,​ ​dismissals,​ ​job​ ​losses,​ ​redeployment,
or​ ​not​ ​promoting​ ​employees.​ ​It​ ​is​ ​generally​ ​done​ ​implicitly​ ​due​ ​to​ ​employment​ ​legislation.