Improving Working Time
Arrangements in SMEs
An Assessment of the Working Time Demonstration:
A research-oriented pilot project in SMEs in Indonesia
Jon C. Messenger
Team Leader, Working Conditions Group
ILO/WORKQUALITY/INWORK
Background: Effects of Working Time
Arrangements on Firm Performance
 How working time is organized—called either “working-time
arrangements” or “work schedules”—can have important effects on
productivity and firm performance
 Specifically, working time arrangements can (Golden, 2012):
 Enhance individual and/or organizational productivity, and thus directly
restrain unit labour costs of production
 Improve employee health and well-being and satisfaction with the job
or life, without raising current labour costs, and thus reduce costs due
to job dissatisfaction & human capital investment
Objective of the
Working Time Demonstration
“Action Research” in SMEs to show how
changes in working time arrangements
(work schedules) can balance workers’
needs with business requirements, by:
 Improving firm performance, and
 Improving workers’ satisfaction with
their jobs and their work-life balance
Some Key Assumptions
 1. Not possible to know a priori what types of working time arrangements
(work schedules) are most likely to produce desired results
 2. Work with managers and workers to develop customized working time
arrangements in each participating enterprise based on their needs
 3. Build on key features of the ILO Sustaining Competitive and Responsible
Enterprises (SCORE) Programme
 Participating enterprises completed SCORE training (workplace cooperation)
 Participating enterprises established Enterprise Improvement Teams (EITs)
Implementation (I)
Seven SCORE Programme
factories in Greater Jakarta,
Indonesia volunteered to
participate in the Demonstration
o Automotive parts and
accessories (4)
o Medical equipment
o Printing and tool bags
o Garment manufacturing
5
Implementation (II)
 1. Informal focus group discussions conducted with managers and workers
in participating enterprises
 2. Customized training materials prepared based on the identified needs
 3. Training Workshops conducted on designing and managing working time
 Workshops for enterprises (managers & workers) and SCORE consultants
 4. “Kick-off Meetings” conducted with EITs in each participating enterprise
 5. EITs in each enterprise developed working time arrangement/schedule
 SCORE business consultants visited firms monthly to assist the EITs
 6. Enterprises implemented the new working time arrangement/schedule
Assessment Methodology (I)
 Qualitative assessment of the processes used by firms to develop
and implement working time adjustments, based on site visits
 Quantitative assessment of key business and worker outcomes
•
Simple before-and-after comparison of outcomes
•
Based on survey data collected from managers and selected
workers at beginning and end of the Demonstration
 IMPAQ international, a Washington, DC-based evaluation firm,
assessed both the process and outcomes and prepared a report
Assessment Methodology (II)
 Limitations of this Assessment:
 Small number of firms participating in the Demonstration
 Participating firms volunteered for the Demonstration
(i.e., they were self-selected)
 The small sample of workers and managers interviewed
Observations from Site Visits (I)
 Some firms tested various small changes in work schedules
 Starting work 30 minutes earlier (to finish earlier)
 Starting work 30 minutes later
 Some firms tested adjusting overtime hours
 Reducing daily overtime
 Reducing Saturday hours
 Some firms tested adjusting break times
 Providing short breaks (e.g., 10 minutes)
 One firm enforced a one-hour lunch break
 However, no firms implemented major changes in working time
arrangements (e.g., adding a shift) despite planning to do so
Observations from Site Visits (II)
 Frequent changes in Enterprise Improvement Team (EIT) membership affected design and
implementation of new WTAs/work schedules
 Lack of HR support created serious limitations at some firms
 Inadequate HR units/functions to support hiring and WTA implementation
 Frequent turnover in HR staff
 Heavy customer demands was a major constraint to making working time changes
 Firms could not reduce daily overtime due to heavy and often unpredictable workloads
 One firm could not cut Saturday hours because customers insisted on Saturday deliveries
 Shortages of skilled workers was a constraint for some firms
 High turnover among skilled workers, due in part to dissatisfaction with long hours
 Competition for skilled workers made it hard to find enough workers to add an extra
shift; this would have enabled these firms to reduce long hours
Manager and Worker Surveys
 IMPAQ International developed two survey instruments:
 (a) Manager survey and (b) Worker Survey
 IMPAQ collected Baseline Survey Data (April - May 2013)
 20 managers and 21 workers
 IMPAQ collected Follow-up Survey Data (February – March 2014)
 19 managers and 22 workers
Manager Survey Responses
C11a. How many worker accidents were recorded last year?
C11a. How many worker accidents were
recorded last year?
Baseline
Follow-up
None
1
5
1-5 accidents
6
2
Manager Survey Responses
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
79%
65%
83%
58%
Baseline
All respondents
Follow-up
Repeat Respondents
Manager Survey Responses
100
80
85
72
60
40
20
45 45
36
32
21
20 17
0
A
B
C
Baseline
33
21
D
Follow-up
21
E
Average
F
G
Worker Survey Responses
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
100%
88%
82%
58%
Baseline
All respondents
Follow-up
Repeat Respondents
Worker Survey Responses
100%
73%
80%
60%
50%
75%
50%
40%
20%
0%
Baseline
All respondents
Follow-up
Repeat Respondents
Worker Survey Responses
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
73%
75%
51%
35%
Baseline
All respondents
Follow-up
Repeat Respondents
Conclusions (I)

Few changes in working time arrangements were implemented during the demonstration


Efforts to make major changes in work schedules did not succeed due to a variety of obstacles



E.g., lack of HR support, inadequate infrastructure, etc.
Both managers and workers believed that working time adjustments improve productivity
Managers became increasingly aware of the need to measure productivity; however they were
unable to measure it correctly



While efforts were made to develop and implement new working time arrangements, only small adjustments in
work schedules were successful
During the project, managers asked for support in measuring productivity
SCORE business consultants tried to assist them, but firms were still unable to measure productivity accurately
Enterprise profitability did not change as a result of the demonstration

There does not appear to be a consistent change in revenue or profitability across enterprises
Conclusions (II)
 The demonstration appears to have reduced the number of accidents at participating firms
 At follow-up, workers felt substantially more positive about their job and work-life balance
than they did at baseline despite few changes in working time arrangements

One possible explanation of this finding is that workers appreciated management’s concern
about their work-life balance

Moreover, workers' involvement in the process of developing new work schedules may have
indicated a level of respect from managers that contributed to workers feeling more positive
about their job and work-life balance

This finding could be interpreted as an effect of worker voice
Lessons Learned
 SMEs have significant limitations in implementing new WTAs/work schedules



Limited HR staff and weak HR support
Weak (or no) infrastructure to measure the effects of working time changes
Other business distractions (e.g., heavy customer demands, inadequate space)
 The range of WTA options offered to participating SMEs was too broad


Some enterprises attempted schedule changes that were not feasible for them
Less ambitious changes in work schedules might have been more successful
 SMEs lack the necessary infrastructure to implement new WTAs/work schedules
 Firms could benefit from practical tools (manuals, software) to help them:


Develop and implement new WTAs/work schedules
Measure the effects of WTA/schedule changes on productivity and profitability
 These tools could enhance development & sustainability of new WTAs/schedules
Thank you for your attention!
Jon C. Messenger
Team Leader, Working Conditions Group
ILO/WORKQUALITY/INWORK