Dave Seibold Professor of Communication,Division of Social Sciences (L&S)

1. LECTURE 8bNew Organizational Forms and SDWTs:Changes in Workplace Control, Organizational Structures,and Leadership Dave Seibold Professor of Communication,Division of Social Sciences (L&S) Co-Director, Graduate Program in Management Practice Technology Management Program (CoE) COMM 122: “Micro- and Macro-Organizational Communication” Lecture 8b November 16, 2009

2. Preview: Lecture 8b (modification to p. 67) A. OVERVIEW B. EMPOWERED ENVIRONMENTS C. QUALITY CIRCLES 1. HISTORY & FEATURES of QCs 2. FINDINGS re:QCs; PROBLEMS with QCs D. CHANGES in CONTROL, STRUCTURE, LEADERSHIP E. NEW DESIGN PLANTS 1. CHARACTERISTICS 2. REASONS FOR/TRENDS TOWARD NEW PLANTS F. SDWTs 1. History & Trends re:SDWTs 2. Transition to Team-Based Organizations

3. Overview (p. 68) Low Worker Autonomy High High Managerial Control Low • Ind. Level Enriched Empowered Environment Environment • Grp LevelQuality CirclesSDWT’s • Org Level Scanlon PlansNew Plants

4. Overview (p. 68) LowWorker AutonomyHigh High Managerial ControlLow • Ind. Level Enriched Empowered Environment Environment • Grp LevelQuality CirclesSDWT’s • Org Level Scanlon PlansNew Plants

5. Changing Involvement, Participation, & Control (p. 69)

6. Overview (p. 68) Low Worker Autonomy High High Managerial Control Low • Ind. Level EnrichedEmpowered Environment Environment • Grp LevelQuality CirclesSDWT’s • Org Level Scanlon PlansNew Plants

7. Characteristics of EmpoweredCollaborative Environments 1. Power & opportunity widely distributed 2. Full, open, decentralized communication system 3. Integrative problem solving used 4. Negative feedback communicated in environment of trust 5. Rewarded/recognized in ways that encourage high performance and self responsibility 6. Personal wisdom/org learning result from org ambiguity, uncertainty, and paradox

8. Overview (p. 68) Low Worker Autonomy High High Managerial Control Low • Ind. Level EnrichedEmpowered Environment Environment • Grp LevelQuality CirclesSDWT’s • Org Level Scanlon PlansNew Plants

9. Quality Circles History Post-WWII Japan Features Small, intact work groups Given time to interact & solve work problems Usually volunteers Evolved from blue collar to white collar CFTs

10. Quality Circles Findings 1. QC members attitudes toward program positive (due to increased voice) 2. QC members attitudes toward the organization, and their job satisfaction, not more positive

11. Quality Circles Findings 3. 1/2 QC studies show that productivity is enhanced (cohesion + decision making -> + productivity) but 1/2 show no increase (yet no erosion either) 4. Mngt has more positive attitudes toward employees who are members of QCs (knowledge demonstrated -> increased confidence in employees -> +attitudes)

12. Quality Circles Problematic Aspects 1. Volunteerism 2. Creates a parallel structure 3. Group members often lack problem solving & interpersonal skills

13. Overview (p. 68) Low Worker Autonomy High High Managerial Control Low • Ind. Level EnrichedEmpowered Environment Environment • Grp LevelQuality CirclesSDWT’s • Org Level Scanlon PlansNew Plants

14. Traditional Workplace Control by managers Pyramid design Vertical, chain-of-command relationships “Stovepipe” operations Rigid bureaucratic procedures Supervised work groups Co-present, F-to-F members National, homogeneous employees Changing Workplace Workers’ participation managing Lattice design Lateral, collaborative relationships Cross-functional arrangements Employee empowerment Semi-autonomous work teams Distributed, virtual work groups Global, culturally diverse, members Changing Organizational Structures

15. New Design Plants as a New Organizational Form Ex: P&G, Kraft, Saturn, Honeywell, Caterpillar, Boeing • Flattened hierarchies • Layers of mid-management eliminated • Wide spans of control, employees organized in “teams” • Reduction of staff support functions • Absence of assigned authority

16. New Design Plants as a New Organizational Form • Decision making pushed downward • Reduced reliance on formal communication channels • Empowered employees • Flexible, self-designed role descriptions • Removal of status markers

17. New Design Plants as a New Organizational Form • Skill-based pay, cross-training • Open access to information • Individual initiative and innovation rewarded • Profit-sharing plans for employees • High levels of business integration (versus functional divisions)

18. New Design Plants as a New Organizational Form Reasons for Popularity of New Design Plants 1. Increase in diversity in the workforce 2. Increase in competition (esp international) 3. Increase in labor costs 4. Increasing education level of workforce 5. Increased legislation re: employee rights 6. Increased support for participative workplace

19. Changes in Managing Organizations

20. Changes in Managing

21. Changes in Managing

22. SDWTs and Changing Organizational Forms Self-Directed Work Teams (SDWTs) 1940s European Coal Mines and Factories 1950s Japanese Quality Circles 1960s US Plants introduce SDWTs: ADM, Cummins Engines, P&G, General Foods 1990s >300 US firms w/SDWTS: Martin Marietta, GM, Xerox, Motorola 2000s 83% of Fortune 400 Companies plan to introduce SDWTs or expand use

23. SDWTs and New Organizational Forms • 2001 Study of SDWTs in 7 Countries Revealed 93% = Improved Productivity 86% = Decreased Operating Costs 85% = Increased Quality

24. Work Teams and New Organizational Forms Ex: “World Class Manufacturing” Reorganization • To obtain superior business results • To carry out the strategy of IIS and Polystyrene • To align teams with major work processes • To improve response time and gain productivity through empowered people working in empowered teams

25. Work Teams and New Organizational Forms Ex: Previous Organizational Structure at Joliet Plant • Vertical structure organized around traditional departments like Operations and Maintenance • Traditional vertical structure • Six levels of authority • Aligned by function

26. Work Teams and New Organizational Forms Ex: New “Ideal State” Organizational Structure • “Teams” as the basic working unit in the plant • Designed from the bottom, up • Aligned by common product/service • Common focus/goals • Cross-functional teams • Improved communication • Improved efficiency

27. Work Teams and New Organizational Forms Ex: New “Ideal State” Organizational Structure (con’t) • Only three levels of authority • Plant manager • Area managers • Associates • Enabled through • Empowered teams • Expanded roles and responsibilities • Extended skill and training requirements

28. Work Teams and New Organizational Forms

29. Work Teams and New Organizational Forms

30. Team-Based Organizations • A. Organizational Infrastructure to Support Teams Predictors of Successful Transitions to Team-Based Organizations (Lawler, 1999) • Organizational philosophy • Top management practices • Job design/redesign • Performance appraisal system • Group-based reward/recognition • Group skills training

31. Team-Based Organizations Characteristics of Formal Work "Groups” 1. Small number of members. 2. Perceive selves as group. 3. Common characteristics. 4. Members are interdependent. 5. Ostensible common goal. 6. Interaction among members. 7. Mutual influence among members. 8. Net positive value associated with membership. 9. Role differentiation and emergent norms. 10. Organizational structure and formal rules. 11. History that provides precedents for decision making.

32. Team-Based Organizations Versus Characteristics of Groups/Teams with Teamwork(p. 70) 1. Members share and can articulate a team vision. 2. Members have defined, valued, and accepted role expectations. 3. Members have role-related autonomy. 4. Members set high standards for themselves and are self-disciplined. 5. Members develop a structure that is responsive to environmental demands, yet appropriate for the organization. 6. Decision-making is conducted within the team. 7. Team leaderadvocates for team, is liaison w/other groups, encourages team, and works to secure resources that the team needs to excel. 8. Members share information and interpretations freely. 9. Members acknowledge and reinforce others' contributions/ support. 10. Members convey and display mutual respect and trust.

33. Team-Based Organizations • Criteria for Effective Teams (Hackman, 1990; 2006) 1. Prereqs to function as a “team”( clear task and objectives from mngt) 2. Balance between managerial and team authority (ends/means; changes) 3. Structures that enable success (motivating task,effective composition, metrics to track performance/alignment work with business indicators) 4. Organizational systems that support teamwork • reward system that reinforces collective performance (team-based evaluation/rewards, not individual) b. training system that supplements members’ skills on ongoing basis (as needed by members, not ‘train first’, not one-shot training) c. information system that provides members access to team-specific information and open culture w/access to senior management d. material resources that enable members to execute tasks (equipment, $, staff, space) 5. Effective leadership that supports teamwork in real time, and at key points

34. Team-Based Organizations Which dimension of team effectiveness to address first in team building? (Seibold, 1995) Vision? Roles? Task Operations/Procedures/Structures/Resources? Relationships?

35. Team-Based Organizations Which dimension of team effectiveness to address first in team building? (Seibold, 1995) Task Operations/Procedures/Structures/Resources!

36. Team-Based Organizations Steps in Team Building (Seibold, 1995) Seek to integrate 4 traditional team-building approaches/”designs”: Problem-solving designs (Structure/Processes/Resources) Goal-setting designs (Vision) Designs to re-shape member roles (Roles) Designs to improve interpersonal relationships (Relationships)

37. Team-Based Organizations Steps in Team Building (Seibold, 1995) 1. Create an agenda by categorizing problems facing the group (i.e., goals, roles, operations/procedures, and relationships) Using methods that are both quantitative (e.g., TEP Instrument) and qualitative (e.g., members' responses to open-ended questions such as "What is preventing this team from accomplishing all that it is capable of?” . . .

38. Team-Based Organizations Steps in Team Building (Seibold, 1995) 2. Use member involvement to improve structure, operations, and procedures. What operational/procedural problem can members resolve quickly and on their own? Member involvement (e.g., ad hoc task forces) will ensure problems most important to the members themselves will be addressed, and members will feel responsible for results. Increased commitment to the group and the rest of the team building process is likely, since members will see they are capable of effecting change concerning matters they face and consider important.

39. Team-Based Organizations Steps in Team Building (Seibold, 1995) 3. Revisit goals and help members create a shared vision Do members all know where they are headed? Do they concur? Are they capable of more than has been asked of them, or than they have produced (or are those goals unrealistic)?

40. Team-Based Organizations Steps in Team Building (Seibold, 1995) 4. Help members consider role requirements with their vision. Do they each understand and accept others' expectations re:their role? How will members’ need for performing outside those role expectations be dealt with? What are the implications of these role expectations for creating a status hierarchy? How will members deal with that?

41. Team-Based Organizations Steps in Team Building (Seibold, 1995) 5. Aid members to improve relationships within the team. What are the ongoing relational problems in the group? How can interpersonal communication be improved? Skill building: listening, communicating non-defensively, and communicating criticism. Supplemented with coaching.

42. Team-Based Organizations • Brief Approach to Team Building (“Work Out”) - Interviews w/each member before off-site retreat - Compile list of strengths and issues - Distribute/discuss team strengths - Personal affirmations and acknowledgments - Review characteristics of “teamwork” - Distribute/discuss team issues - Refine issues list (Worksheet #1) - Personal actions to improve team (Worksheet #2) - Others’ actions to improve team (Worksheet #3) - Summarize, continuing work by team