Home > Ownership Culture > Articles > Guest Column >

Want to Be Profitable? Involve Everyone

Sid Scott

April 2001

Last year, Dr. Ed Lawler, a highly respected professor of management at the University of Southern California announced his findings that employee involvement outshines total quality management (TQM) and downsizing (process re-engineering) as a way to help companies produce better financial returns. Sadly, only a small percentage of U.S. workers (probably less than 12%) work in companies that encourage and promote high employee involvement. Organizations with an ESOP or stock options have a distinct advantage of tying employee involvement to benefits for employee owners; i.e. themselves.

What Is Employee Involvement?

Those companies that have implemented employee involvement use a variety of techniques. However, all approaches usually involve four things: redefinition of management’s role within the organization; training individuals and departments to work together as a team; encouraging participation by non-management employees in problem solving and decision-making; and, broadly sharing information/tools/resources needed to understand and address problem situations.

Managers in high involvement workplaces become more like coaches and less like referees in how they approach their roles and responsibilities. Because they have authority to decide who will participate in various situations, managers need to encourage participation, provide the necessary resources and help individuals understand their roles in making the process successful. This is in contrast to the traditional managerial role, as Tom Peters has described it, of a "naysayer or a pronouncer" and the sole decision-maker.

To implement employee involvement in my company, we embraced a concept called Access Management. This was developed by Dr. Jay Hall, a social psychologist. Dr. Hall defines the manager’s role as both a gatekeeper to encourage participation and the person who will provide the structure to allow full participation. By giving non-management people access to the problems, the people needed to help collaborate, the information/resources, freedom from policy obstacles and the ultimate solutions, managers can ensure employee involvement success. We have found that Dr. Hall’s approach can work in many situations and environments.

We call our involvement process Participatory Management: "Participatory Management is an approach or style of WCI's culture that encourages participation from every person in the organization, unit or group who is, or will be affected by a problem situation, the solution to the problem, or a decision. Whenever possible, decision-making should be pushed to its lowest effective level, thus empowering all employees to take their share of responsibility for the success of the organization." Before a decision is made or course of action taken, those individuals who will be asked to carry out the decision or who will be affected should be consulted for their input."

This doesn’t mean that all decisions are made by teams, committees or task forces. As we recognized, some decisions are best made by the managers, some are best made by the team or work group, and some decisions are best made by individual employee-owners, even if they aren’t managers. Group decision-making is one method to make decisions. Asking others for input, through advice and counsel, is another successful involvement technique.

Why Don't More Companies Embrace Employee Involvement?

There are a number of reasons that so few companies have taken the steps to encourage involvement and participation. Among them are: lack of understanding of the concepts and the benefits; fear of change to something new; fear that control will be lost; and, belief in the old managerial model.

Organization development experts say that meaningful change takes time and so does skills training. Change is never easy, and it is a human tendency to be cautious, if not outright negative, toward anything new and untried. Some companies have embraced the concepts verbally but have discovered that the road to successful implementation has quite a few obstacles and "pot holes." One difficulty is that middle-level managers often see employee involvement and teamwork as threats to their authority as managers. Because they are "caught in the middle" between enthusiastic, yet skeptical employees and enthusiastic, yet demanding top management, line supervisors, department heads, etc. often put up the greatest resistance to employee involvement.

Managers aren’t the only ones who need to learn new things. Non-management employees who have not had the opportunity to work in groups need to acquire knowledge and skills on how to communicate in groups, how to participate in meetings and how to identify and solve problems. A company may also need to overcome the fear that some people have from past experiences where they were criticized for offering ideas or suggestions that were contrary to what their supervisors believed. Having once been labeled a "troublemaker" or a "non team player" can make folks less than enthusiastic about offering their ideas. If managers can ensure that any idea—no matter how far out—will be acknowledged and considered, then the trust lost previously can be rebuilt around an open, encouraging, team environment.

Another key part of employee involvement is having tasks/goals/problem solving around issues that are meaningful to employees. The focus needs to be on "real" problems that affect the workflow, product design, customer service, etc.—in essence, the bottom line. By using this tactic, managers can help employees begin to look at the company as their own business and the goals of the organization something they can believe in and support.

Tom Peters once said, "The most effective leaders, political or corporate, empower others to act and grow in support of a course that both leaders and followers find worthy…they do not induce narrow obedience to a precise objective among followers. To the contrary, powerful leaders make followers more powerful in pursuit of a commonly held dream, jointly defined."

Sid Scott is Vice President of Human Resources for Woodward Communications, Inc., a multi-media corporation located in Dubuque, Iowa. WCI became a 30% ESOP company in January 1992, and increased employee ownership to 61.58% in February 2001. He was elected to a second term on the NCEO Board of Directors in 2000, and is a frequent presenter/facilitator at conferences. Sid serves on the board of Monroe Publishing Company, a 100% employee-owned newspaper located in Monroe, Michigan. He has a MBA from Bradley University, a BS in liberal arts from Illinois State University and is an adjunct faculty member in business administration for Clarke College in Dubuque and the University of Wisconsin-Platteville.

List of other "Guest Column" installments

^^Top of Page