Pfeffer s The Human Equation

1. Pfeffer�s The Human Equation Premise: �Numerous rigorous studies have demonstrated the enormous economic returns obtained through the implementation of high involvement, high performance, or high commitment management practices� (p. xv).

2. The Human Equation �Trends in actual management practice are, in many instances, moving in a direction exactly opposite to what this growing body of evidence prescribes� (p. xv).

3. Key Question �When you look at your work force, do you see the source of your organization�s sustained success and your people as the only thing that differentiates you from your competition? Or do you see people as labor costs to be reduced or eliminated� (p. xix).

4. Practice 1: Employment Security �Innovations in work practices�are not likely to be sustained over time when workers fear that by increasing productivity they will work themselves out of a job� (p. 65).

5. Employment Security Encourage contributions by employees. Avoid careless layoff/rehire cycles �why would we want to put our best assets, our people, in the arms of the competition?� �our commitment to job security has actually helped us keep our labor force small and more productive.�

6. Employment Security �By hiring when times are poor and developing a set of policies, including assurances that people will be retained, a firm can become the employer of choice, and the organization will not have to enter the labor market at its very peak to acquire the necessary work force� (p. 68).

7. Employment Security �Employment security does not mean that the organization retains people who don�t perform�it means that employees are not quickly put on the street for things, such as economic downturns or the strategic mistakes of senior management, over which they have no control� (p. 69).

8. Selective Hiring �Organizations serious about obtaining profits through people will expend the effort needed to ensure that they recruit the right people in the first place� (p. 69).

9. Selective Hiring Large applicant pool - energetic recruiting. Clear on the most important skills. Determine skills based on particular job requirements and the organization�s approach to the market Screen on attributes that are hard to change through training and differentiate among those in the applicant pool.

10. Self-Managed Teams and Decentralization The power of teams and decentralization Substitute peer-based for hierarchical control of work. Pool ideas to come up with better and more creative solutions to problems. Permit removal of layers of hierarchy. Avoid cost of people who watch people who watch other people do the work.

11. High Compensation Contingent on Organizational Performance �Some relationship exists between what a firm pays and the quality of the work force it attracts.� Forms: gain sharing, profit sharing, stock ownership, pay for skill, and other individual and team incentives.

12. Training �Training is an essential component of high performance work systems because these systems rely on frontline employee skill and initiative to identify and resolve problems, to initiate changes in work methods, and to take responsibility for quality. All of this requires a skilled and motivated work force that has the knowledge and capability to perform the requisite tasks� (p. 85).

13. Training Paradox: Training funds are most plentiful when the firm is doing well. But, when the firm is doing well, its people are busiest and have the most to do�when the firm is less busy, individuals have the time to train, but that is exactly when training is least likely to be made available (p. 89).

14. Reduction of Status Differentials Can you tap into the skills, etc., of your employees when you employ practices that make some feel less valued? Symbolic reduction through use of language and labels. Substantive reduction through removal of compensation inequity.

15. Sharing Information �The sharing of information on things such as financial performance, strategy, and operational measures conveys to the organization�s people that they are trusted� (p. 93).

16. Sharing Information �Even motivated and trained people cannot contribute to enhancing organizational performance if they don�t have information on important dimensions of performance and training on how to use and interpret that information� (p. 94).

17. Sharing Information Why not? Information is power. The information will leak out to competitors, creating a disadvantage to the organization.

18. Paper Evaluate how well your company follows five of the seven practices enumerated by Pfeffer. Make recommendations on what they could change. Up to 12pages (double spaced). Due January 15th.