Week 10 Flashcards
Maslow’s Hierarchy of Needs
Basis for Mcgregor’s theories X,Y (and Z)
Self-actualization Esteem Social needs Safety/security Physiological needs
Theory X
McGregor Driven by monitory concerns Avoid work where possible Lack ambition and dislike responsibility Indifferent to organizational needs Lack creativity and resist change
Theory Y
McGregor
Driven by job satisfaction Actively seek work Show ambition and seek responsibility Follow organizational objectives Have creativity and welcome change
Theory Z
Need for self-fulfilment or transendence
Organisations that enable their staff to achieve this will earn their loyalty
Goal Setting
Locke and Latham
Beneficial effect on task performance
More effective if (Challenging (still achievable), specific, quantiative, monetary reward, supportive approach)
Feedback on performance should be provided regularly
MBO/MBR
Management by Objectives/Results
More effective when top management is committed to the approach
Objectives set in appraisal meetings by manager and employee
Performance renewed and new objectives set annually
Bonuses for meeting/exceeding objectives (Objectively measurable) cf traditional factory workers
Appraisal meetings
Constructive place to reflect
Suitable time, private space, planned duration
Summary of last appraisal meeting and agreed objectives
Objectives not met or only partially met in appraisal meetings
Let employee explain the situation from their perspective
Adjustment of the targets
Additional coaching or training
Poorly run appraisals
Checkboxes, subjective evaluations, overt criticisms/threats/defensiveness
Managers unable/unwilling to give direct constructive criticism
Negative perfecptions from employees
Improving poorly run appraisals
Switch to having frequent discussions as opposed to annual appraisal meetings
Setting future goals may be better separated from past performance reviews
Improving subjective and innacurate ratings
360 degree feedback, use multiple raters
Solicit feedback from all areas employee interacts with (Other employees/employers)
Use of feedback in evaluation could be dubious (Large variety in ratings, anonymous reviewers can harbour grudges)
Scott Adams’ Company Model (Dilbert Principle)
Companies with effective employees and good products usually do well
Any activity which is one level removed from people and products will eventually fail or have little benefit
Rule for “one-off” activities should be consistency (don’t tinker)
Out at 5 Managers
Stay out of the way
Eliminate the assholes
Make sure employees learn something every day
Creative an environment which supports curiousity and learning
Teach employees how to be efficient
Adams’ Equity theory
Not Scott Adams
Staff will inevitably compare input/reward ratios, must be a reactive process
If rewards aren’t fair, staff will lose motivation
Performance related pay schemes from Green & Heywood
Increase productivity, effort, earnings
Increase pay variability, lower morale for less productive workers
Should a company use performance pay/bonuses
Highest job satisfaction where no performance pay/bonuses exist
Job security declines where no performance pay/bonuses exist
Although negatives disppear when accounting for worker fixed effects
Conclusion will vary depending on the type of worker and company involved
High performance workplaces
Create belonging, esteem and commitment
Piece rates known to increase efforts more than time rates
Job satisfaction
Declines with education level and company size
Public sector workers tend to be more satisfied
Pay and satisfaction
Only loosely related
Stronger link between pay level and pay satisfaction
Looser link between pay level and job satisfaction
Wellbeing from Diener and Tay
Increasing globally
As average income also rises
Team based rewards as opposed to individual rewards
In many cases, performance is dependent on a team rather than one person
Individual rewards don’t incentivize good team behaviour and may even undermine cooperation in competitive organisations
Some employees concerned about “free riding”
Team based rewards research
DeMatteo : Reports of increases of 28-76% productivity cf previous measures, unclear what under conditions team rewards are effective, worth studying reward, team and organizational characteristics and individual differences
Ladley : Game theory simulation: Group based systems outperform individual or mixed systems. Produce most cooperative behaviour and highest performing individuals/groups
Team-based rewards options
Incentive pay
Recognition
Profit sharing
Gain sharing
Incentive pay
Can be combined with incentive pay per individual
May put off employees averse to identifying as team members
Recognition
One-off additional payment for exceptional performance
After the fact, so doesn’t enhance motivation to begin with
Profit sharing
Gives employees incentive to monitor employers results
Profits may not be affected very much by the team’s performance
Safer as bonus can be varied up or down in line with profits (cf employee share schemes)
Can be demotivating if bonus is significantly lower than a previous year
Gain sharing
Rewards team for improvements in local production measures
Hopefully can be influenced by the team in some way
Employee Share Scheme
Employees have the right to buy shares at a discount giving them a long term stake
Motivation to act in the company’s best interests
Sense of ownership known to encourage them to stay with the firm
If too many shares given, other shareholders lose out
Tax breaks can be given to the employer
Executives may be granted shares based on the company’s performance
Other incentives
Overtime
Company cars
Subsidised travel et.al
Kahneman & Tversky’s prospect theory
Losses hurt more than gains, so are avoided
Drucker’s management functions
Set team/organisational objectives Provide resources to meet objectives Motivate staff Monitor staff performance against objectives Improve performance by developing staff
Walk the corridors (3Gs)
Builds trust, dispels “myths” around those in leadership.
Can listen to staff and understand them better
Real place, real work and real facts
OODA (John Boyd)
Observe, orient, decide, act
Developed by the military, fast decisions required from one person
Less useful for strategic decisions which require longer deliberation and more people
Drucker purpose of business
Create and keep a customer
Drucker business enterprise basic functions
Marketing and innovation
Management/Leadership style (Blake and Mouton)
Dependent on concerns for tasks and concern for staff Country club Team Impoverished Task compliance & Middle of the road
Sources of power (French and Raven)
Legitimate Reward Coercive Expert Charismatic (Often the most influential source of power)
Transactional leadership
Reward effort and good performance
Coercion to correct poor performance or compliance
Leaders need to be able to follow through otherwise they damage their credibility
Transformational leadership (Downton and Burns)
Proactively change company culture to implement new business practices
Ideals (Act as role model)
Inspiration (Charm to inspire effort)
Individual consideration
Intellectual stimulation (Promotes creative and innovative solutions)
Enhances staff satisfaction with their leaders however transactional leadership may boost performance more
Charismatic leadership
Skilled communicators who reach followers at an emotional level
Greater emphasis on vision
May encourage risk taking behaviour amongst followers
More associated with politics and religion also
Can allow for tunnel vision and staff dependence
Masterful inactivity
Can argue that change is cyclical and current crisis is only temporary
Works better in long term investments/politics
Grove “Only the paranoid survive” in modern business
Always changes to manage so not recommended
Situational Leadership (Hersey and Blanchard)
Mapping of commitment against competence Coaching Delegating Directing Supporting
Questions to ask yourself for situational decision making (Vroom, Yetton, Jago)
Quality requirement Commitment requirement Leader's Information Problem Structure Commitment Probability Goal Congruence Subordinate conflict Subordinate information
Different styles of decision making
Autocratic 1 (Only using information available to them) Autocratic 2 (Obtains additional information from group members, makes decision alone, group members may/may not be informed) Consultative 1 (Leader shares problem with group members individually, asks for information/evaluation, no collective meeting, leader makes decision alone) Consultative 2 (Leader shares problem with group members collectively but makes decision alone) Group 2 (Leader meets with group to discuss situation, leader focuses and directs discussion without imposing will. Group makes final decision)
Population and income growth
Mostly expected in Africa and Asia
Global companies must target these continents
Propserous families have fewer children (save the planet by letting everyone propser)
Taylor on production
Argued managers should match workers to their jobs
Determine their ability and provide the right training
Determine the expected output for each worker on each task
Provide workers with proper working methods, tools and routing
Select and train supervisors, introduce incentive payments
Hawthorne conclusions
No correlation between productivity and working conditions
Belonging to a group creates status and boosts morale
Productivity is boosted by treating workers with respect
Statistical quality control
Dependent on repeatable processes and detailed measurements
Determine acceptable failure rate and failure modes and test against them
Drucker “If you can’t measure it, you can’t manage it” - Need for precise measurements and statistics
Six Sigma approach to quality (DMAIC)
Six standard deviations away from the mean. 1 in a million manufacturing failure rate
Can be different in practice depending on product and market
Define, measure, analyze, improve, control (alternative of PDCA/PDSA)
Bathtub curve
Time dependence of failures create bathtub curve
Early failures (Infant mortality)
Constant random failures
Failures from wearing out
Alternative quality definitions (Deming, Juran, Crosby, Feigenbaum)
Non-faulty systems
Fitness for use
Conformance to requirements
Customer determination based on experience with product measured against their requirements, stated or unstated. Always represnts a moving target in a competitive market
Kaizen philosophy
Continuously improving working practices
Reaching targets by stepwise improvements rather than radical changes
Shewart idea
Plan do check act
Plan do study adjust
Deming in Japan
Took ideas from Kaizen and Shewart
Emphasized profound knowledge
Appreciating a system fully
You cannot improve what you do not understand
Approaches to quality
Quality control (Maintain standards by testing) Quality assurance (Maintain standards by providing confidences) Total quality management (Everyone responsible for maintaing standards)
Kanban assumptions
Any system has a natural rate - it’s Takt time
Profound knowledge
Focus on reducing waste Quality is free (Conformance costs vs noncoformance cost) Trust workers to improve quality Trust workers to estimate their work Any system has a natural rate
Japan/Toyota steps to quality (5Gs)
Real place Go and see Data and facts Principles Standards
Root cause analysis (5 Whys)
Ask why 5 times to try and find the source of failure
Can also use a fishbone diagram
Waste (Muda)
Transportation
Waiting et al.
Pareto principle
80% of outcomes are traced to 20% of causes
Control chart
Allows you to measure if a process is within any defined limits
Poka Yoke
Mistake proofing
Heijunka
Levlling the workload
5 Ss (Quality techniques in manufacturing)
Sort out Set in order Sweep Standardise Sustain
Lean thinking in business processes
Trying to avoid duplicated data, excessive reporting et al. (Waste)
Use process maps or flowcharts to map, measure, control and fix a process
ISO 9001-2015 quality management systems overview
Very popular certification (1m globally)
Sector specific variants exist
Some argue that the paperwork is excessive
ISO 9001-2015 Principles
Customer focus Leadership Engagement of people Process approach Improvement Evidence-based decision making Relationship management
Business changes
Start-up companies may begin with one plan and then pivot to another
Mature companies can boost their life through a strategic inflection point
Companies in decline may need to close or sell off failing divisions (or risk bought or merged with another company)
Company lifecyle
Sales (starts at 0, peaks at end of growth, beginning of maturity)
Cash (Decreases from 0 initially, peaks in maturity)
Profit (Decreases from 0 initially, peaks in growth)
Company executive decision making
Is service making a loss?, Can it be sold?, Can it be turned around without making anyone redundant?
Consider impact on profits and costs. Doesn’t focus on the future
Decision is about the future, need to ask if this is a blip and whatnot
Inflection points
More likely in technology businesses
May destroy old businesses but will create new opportunities
Creative destruction
Projectification
Technology businesses are driven by product development projects
Marketing is also driven by projects (campaigns)
Both firms and the public sector have been “projectified”
Change management projects
Often fail
Consider those being affected(threatened, undermine the change passively or actively)
Require: trust change is positive, persuasive vision people can buy into and executive sponsorship/ownership
Kotter’s 8 step process for change management projects
Establish a sense of urgency Create a guiding coalition Develop a change vision Communicate the vision for buy-in Empower broad-based action Generate short-term wins Never let up Incorporate changes into culture
Kanter’s Change Masters
Someone that drives change
Tune into the environment Use kaleidoscope thinking Communicate a clear vision Build coalitions Work through teams Persist and persevere Make everyone a hero
Crisis
Unexpected threat to the organization
Need to consider the reality and perception both internally and externally from the company
Lerbinger 8 Crisis categories
Natural disaster, technological crisis, confrontation, malevolence, organizational misdeeds, workplace violence, rumours, terrorism
Others also
Crisis Management
Perceptions about the risk, combined with context and preparations
Dealing with an event through planned and ad-hoc individual/collective reactions
Coombs on crisis management
Situational crisis communication theory needed
Crisis responsibility, response strategies, emotions, crisis history, prior relationship and organisation reputation all drive behaviour (communication)
Insolvency
Insufficient inflows to meet cash outflows
Avoided by negotiating with creditors, liquidating assets, acquisitions/takeovers, court relief etc.
Due Diligence
Analyse a company prior to business transaction
Company situation, operations, staff and other assets
Done with questionnaire (dubious responses), consulting industry analysists, key company personnel (potential employees), published accounts, management accounts (nda)
Liability insurance doesn’t cover everything
Due diligence questionnaire