Chapter 16
Managing Change and Workplace relations
Managing Human Resources
Charmaine Chan
1
What makes a Change?
• Casualised work force; lifetime employment is gone; high
unemployment; eroded job security; redundant traditional
skills; downsizing; predictable work, pay, career, trust and
loyalty have gone.
• companies are demanding more; job flexibility, multiskilling,
employability, TQM, new technology
• Increased stress, work-family conflicts, dropping living
standards, but people are working longer hours, increasing
work effort, intensifying pace of work.
• Instead of stability and certainty, now workplace offers
change, uncertainty and anxiety.
2
HR Managers as Change Agents
HR managers are expected to:
introduce new policies and practices
change the culture of workplace
make organization more responsive, flexible and
competitive
HR managers continuously monitor organisation’s
environment for:
– uncertainty (what information is available for accurate decision
making?)
– volatility (how often is the environment changing?)
– magnitude of change (how big are the changes?)
– complexity (how many external/internal influences?)
– changes in organisational culture (changing employee behaviour
requires a change in the organisation’s culture).
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Steps in the Change Process
1.
2.
3.
4.
Determining the needs for change
Determining the obstacles to change
Implementing change
Evaluating change
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1. Determining the Need for Change
• Need become apparent when there is a gap between
performance objectives and actual performance.
• Indicators such as total net profit, sales per
employee, labour costs etc.
• Or any decisions to enter new businesses or exit
existing business, change will be required.
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2. Determining Barriers to Change
Managers need to identify all potential barriers:
 Resistance to change at organization, or
division or individual level
 Unions resistance
 Organization’s existing (bureaucratic?)
culture, strategies and structures are
powerful barriers
 Financial ability
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3. Implementing Change
By internal managers or external consultants?
Internal managers:
– more knowledgeable about people and business
operations
– often are too narrow in outlook and too imbued with the
existing culture to successfully introduce change.
External Consultants
– Politically neutral and possessing broader and more
knowledgeable viewpoints
– Generally do not know the organisation and its people.
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3. Implementing Change (con’t)
Top-Down or Bottom-Up Approach?
Top-Down:
– Involves management deciding on the change and then
implementing it.
– Emphasis is on speed and action.
– Often faces problems in implementation due to the
resistance/dissatisfaction of managers and employees.
Bottom-up:
– Involves considerable discussion and consultation with
managers and employees.
– Emphasises participation and communication and the
minimisation of uncertainty.
– Time consuming
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4. Evaluating change
• To measure the effectiveness of change,
organizations must compare the before and
after situations.
• Indicators such as employee productivity,
job satisfaction, sales and the like can be used
to evaluate the effects of the change.
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Workplace Change
High technology is one of the most important causes
of organizational changes. (e.g, introduction of new
equipment) sets off a chain of events.
–
–
–
–
Less skills required
A loss of status
Carry lower pay rate
Less autonomy for workers and unwanted change in
reporting relationships
Resistance and anger
Effectiveness of technological change related to
culture and structure of company.
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Resistance To Change
• fear of the unknown– not understanding what is
happening or why
• disrupted habits– feeling upset when old ways of
doing things cannot be continued
• loss of confidence– feeling incapable of
performing well under the new way of doing
things
• loss of control– feeling that they are no longer to
possess a certain control over some tasks
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Resistance To Change (con’t)
• poor timing– feeling that things are moving too
fast
• work overload– feeling that physically or mentally
unable to handle the change
• loss of face– feeling uncomfortable because old
ways are no longer perceived as good ways
• economic loss– feeling that their pay and benefits
may be reduced or that they may lose their job
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Reducing Resistance to Change







Communication
Participation
guarantees
certainty
counselling
negotiation
reward
13
Restructuring Changes:
Acquisitions, Mergers, Divestitures
Acquisitions:
Purchase of a firm by another firm
Mergers:
Combination of two or more firms to form one
new company
Divestiture:
Selling selected operating units for strategic or
financial reasons
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Restructuring and HR
Managing the organisational restructuring is one
of the major challenges facing today’s HR
manager.
Problems faced by HR management during
restructuring include:
cost of lost talent
lost productivity
loss of competitive position
expense of union problems
cost of miscasting people
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Overcoming Problems of Restructuring
 ensure a compelling strategic rationale exists for
the acquisition or merger
 move quickly to meld the two companies
 overcome conflicting corporate cultures
 create retention incentives for key employees
 audit the policies and practices of the acquired
company
 ensure the orientation of new employees
 redesign compensation programs
 integrate management styles
 communicate restructuring decisions
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Downsizing
• A reduction in a company’s workforce or job
elimination to improve efficiency
• A ‘lean and hungry’ organisation rather than a ‘fat and
comfortable’ one is the goal.
• The elimination of middle management jobs has
produced increased spans of control, time pressures and
complexity in those supervisory jobs remaining.
• Because downsizing involves change, it requires a
strategic, proactive approach to human resource
management.
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Downsizing Survivor Syndrome
Downsizing may create hardships because of
increased stress, fear of unemployment and
reduced job opportunities (especially for older
workers and for those without marketable skills).
Stress caused by anxiety, guilt and fear of job
loss in those employees remaining in
downsizing organizations (‘survivor syndrome’)
HR programs are needed to overcome the
aftershock associated with large-scale
retrenchments.
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Making Downsizing Effective:
• Target specific inefficiencies, redundancies and low-value
activities for elimination.
• Retain those who are competent to achieve organisation
objectives
• Treat employees who lose their jobs with compassion.
• Promote open and frequent communications to encourage
employees involvement in change process.
• Generate excitement about the future by creating a vision.
• Detail plan and link it to the organisation’s strategic
business objectives to ensure having the right people in
place after the downsizing is completed.
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How HR Can Help Managers
Ten basic principles that HR professionals can use to lay off or
eliminate employees in a respectful way.
1. Conduct the meeting in private.
2. Keep the meeting short and to the point.
3. Offer support and compassion.
4. Explain why the company made the decision.
5. Don’t make discriminatory statements.
6. Control your emotions.
7. Give the severance package in writing.
8. Encourage the employee to be positive.
9. Plan a graceful exit.
10.Inform other employees, customers and suppliers of
the decision.
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Total Quality Management (TQM)
• Total quality management (TQM) involves
‘an organisation-wide commitment to
continuous improvement and totally meeting
customer needs’.
• It builds quality into everything - production
design,,purchasing, marketing and HR.
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Results from TQM
• an ability to anticipate, meet and exceed
customers’ expectations
• gaining a competitive advantage via better
products and services and improved work
processes
• gaining management and employee
commitment
• staying in business
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Managing Quality
•
•
•
•
•
•
•
Creating a quality culture
Satisfying the customer
Championing of TQM by top management
Measuring quality
Starting with quality
Striving for high standards
Involving people
• Training management and employees in leadership and
team building
• Recognise that there is no one best way of introducing
TQM
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Workplace Relations
• Refer to employer-employee relations in a
specific workplace
• A company’s strategic HR objectives affect
all aspects of workplace relations.
• They impact on rates of pay, recruitment,
selection, job security, health and safety,
employee motivation and employee attitudes
towards the company and union membership.
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Work Climate
• Work climate has a direct impact on viability
of many HR management activities.
• HR managers are important in persuading
line managers of the strategic benefits of
innovative HRM policies and practices.
• Line managers are critical in influencing
employee attitudes and in achieving
harmonious workplace relations.
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Bad Workplace Relations = Bad Management
• Bad workplace relations may lead to: demarcation,
strikes, go slows, reduced productivity
• Remote, faceless managers foster negative solidarity
- ‘us against the company’
Good Workplace Relations = Good Management
• Good industrial relations centres on leadership,
communication, understanding, trust, cooperation and
mutual commitment to shared objectives.
• Managers who genuinely spread the believe that
‘people are the company’s most important asset’.
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Successful Management Action in Workplace
 developing HR values and strategies that deliver
management's approach to people management
 encouraging open communication and being
prepared to listen
 ensuring that managers are out of their offices and
give employees personal attention
 ensuring that front line supervisors are trained and
have the necessary authority and rewards to make
them feel part of management
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Successful Management Action Workplace
 recognising loyalty and seniority
 objectively identifying and rewarding performance
 creating a pleasant and safe physical work
environment
 encouraging the development of employee skills by
ongoing training and development
 ensuring fair and competitive compensation and
benefits
 communicating to employees that management is
committed to treating employees fairly and with
respect.
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Salaried Operations
• Involves all employees being treated equally as staff
rather than as staff and wages personnel
• Promote the mutual interests of employees and the
organisation, are treated as staff rather than as staff
and wages personnel.
• Aims to remove artificial barriers by using
cooperative effort and to ensure employees are
given equal respect and treatment
• Emphasising the creation of a more productive,
efficient and competitive organisation by enhancing
employee commitment and competence
29
Salaried Operations (con’t)
• Achieved by:
– Status symbols (e.g. reserved parking, separate canteens)
and different policies for staff personnel, treat them as
first second class citizens
– Rewards based on individual efforts and achievement
– Emphasis on multiskilling
– High pay and fringe benefits
– Well trained supervisors with confidence and know how
to manage HR
– Decision making is pushed down to the lowest level to
promote individual responsibility and reduce the need for
supervision
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