Week 11 - Strategic IR and Case Studies

Question 1

What is strategy?

Answer 1

The way in which an organisation, including a trade union ensures its continuity of existence over time, including by interacting with its external environment and controlling its internal environment.

Question 2

What is strategy content?

Answer 2

A coherent, unifying and integrative pattern of choices that reveal or achieve the organisation’s long term objective or reason for existence.

Question 3

What are the two broad views of management strategy in employment relations?

Answer 3

1. Management may adopt a consensual approach - labour is a valuable resource to be maximised; employee commitment is sought and employees have a voice (direct and indirect)
2. Management regard labour as a cost to be minimised - employees are a commodity; stringent control/supervision may be applied; employee commitment is not sought; employee voice is not encouraged and trade unionism is regarded negatively and is deterred.

Question 4

What does the consensual approach to ER strategy mean?

Answer 4

• referred to the collaborative approach to ER and so has commonalities between HR and ER
• it fits with the Quality Enhancement Strategies and Growth Strategies within an organisation and my be regarded broadly as the ‘soft’ approach but with all HR activities integrated to meet the business objectives as with strategic HRM
• There is an emphasis on the retention of core employees and this strategic approach tends to become more popular in a tight labour market where there is competition to attract and retain skilled labour such as during a resource boom.

Question 5

What is the relationship between consensual approach and traditional pluralist IR?

Answer 5

• encouraging member participation in union affairs and training programs
• developing good communication channels to ensure different forms of employee voice are available
• minimising areas of avoidable conflict by maximising areas of common interest
• institutionalising irreducible conflict by using grievance procedures in enterprise agreements
• reducing power of strategic groups who can disrupt work
• developing effective control systems and customer relationships
• management will share control to retain control

Question 6

What does the commodity view mean with respect to ER?

Answer 6

Reflects the cost minimisation approach to managing people and also can result in adversarial employment relations when there are trade unions present

• employees are replicable and therefore easily replaced; no need to offer extensive training
• broadly a ‘hard’ HRM approach focussing on measures and controls
• fits with cost minimisation and commodity strategies and can experience high absenteeism; outsourcing can be a strategy
• accompanied by individualisation of the employment relationship

Question 7

What factors influence ER management strategy?

Answer 7

• country of origin and level of education and skills and experience of the manager
• industrialisation stage and type regarding the industry and organisation, especially in transitioning economies
• personal ideology of the manager
• belief system of the country in which the manager operates
• skills, education, experience of the employee
• company ideology derived from culture, strategy, structure, custom & practice, private or public sector
• Legal framework in which managers are operating / legislation changes
• Industry factors e.g. nature of work, degree of unionisation, geographical location
• profitability of the company and industry

Question 8

According to David Guest why is there a need for a strategic focus on the management of IR?

Answer 8

• to ensure that there is a close fit between product market, competitive strategy and workforce and employment practices

Question 9

What is the purpose of ER strategy?

Answer 9

1. To control the external ER environmental constraints

2. To control the internal ER environmental constraints

Question 10

Provide some examples of the interplay between the external and internal environment regarding strategy

Answer 10

• corporate strategy needs to consider ER climate in the country, region or industry in which it operates
• ER is often pushed to line managers or becomes a subset of HR which devalues the implications of getting it wrong
• ER negotiations can be outsourced to people who don’t understand the internal environment and culture

Question 11

What are the internal ER environmental constraints?

Answer 11

This is also a long term approach and may involve building a certain type of organisational culture. There are a range of options open to management in terms of controlling the internal environment:

• use monitoring and surveillance for direct and technical control
• choosing centralised enterprise negotiations to limit workplace organisation and vice versa
• may limit employee participation in workplace or foster it (Grocon vs Ford)
• may foster moderate unions (eg. AWU over CFMEU in mining, SDA over AMIEU for coverage of supermarket butchers)
• may bypass unions altogether under workchoices)

Question 12

What factors are important to achieve a successful organisation in terms of performance to be considered an excellent employer?

Answer 12

• quality of working relationships and workplace leadership; a sense of ownership and identity
• participation in decision making through EV, getting feedback
• clear values, autonomy and uniqueness
• safety
• recruitment, wages, compensation
• community connections

Question 13

Where are Australian managers?

Answer 13

• state of flux between moving from this pluralist approach to one that emphasises the individual. Caught in the middle are trade unions and their members
• companies that have effectively built into their ER strategies both a pluralist and an individual approach to managing their workforces will not necessarily benefit from the opportunities provided under legislation because they already have strategies aimed at promoting flexibility, productivity, trust and commitment

Question 14

Workchoices 2005 and managers - discuss

Answer 14

• Legal changes do not improve management performance and usually poor ER management indicates poor performance in other areas.
• Finlay Engineering Melbourne - dimissed three employees under Workchoices and then ceased to operate
• COwra abbatroir sacked 29 employees and then offered them lower conditions under workchoices; then ceased to operated and later reopened under new management after a work process restructuring process

Question 15

Sum up the ER landscape in Australia today

Answer 15

• trend for big business is to move away from the traditional pluarist ER to unitarist strategy reliant upon sophisticated strategic HRM
• this involves settting organisational goals that clearly identify the place and role of IR within an HR framework - rather than HR within an IR framework - and improving direct employee involvement in decision-making and in access to grievance procedures
• ER should encompass HRM, IR and employee relations
• emphasis on team orientated culture and flexibility

Question 16

Employer associations and ER - discuss

Answer 16

• became more proactive during the 1990s in order to survive. Proactivity is largely in areas of service provision and lobbying

Question 17

What is global business unionism?

Answer 17

celebrates diversity and is based on organising across workplaces and countries

Question 18

What is social movement unionism?

Answer 18

based on democracy and a wider social vision

Question 19

Name some strategies adopted by trade unions

Answer 19

1. Arbitral
2. Political
3. Legal
4. Industrial
5. Servicing
6. Sweetheart Deals
7. Organising
   8 combingation of servicing and organistin
   9 community unionism

Question 20

What is an arbitral strategy?

Answer 20

• traditional reliance on the centralised conciliation and arbitration system and industry awards to retain members
• chilling effect on relationship between employers and trade unions
  e. g. AWU

Question 21

What is political strategy?

Answer 21

where a trade union relies heavily on having its officials elected as politicial reps and then changing the industrial relations legislation from within e.g. AWU

Question 22

What is a legal strategy?

Answer 22

• new alternative to arbitral strategy, reliance on Federal and High Court decisions to achieve objectives
• expensive and often initiated by an employer
  e. g. CFMEU is resorting to this strategy more and more in the building and construction industry

Question 23

What is the industrial strategy

Answer 23

• the union resorts to industrial action, is pursued by left wing militant unions, can be severely limited by legistlation

Question 24

What is the servicing strategy?

Answer 24

• union provides members discounts, insurance, training

- often relies on sweetheart deals

Question 25

What is a sweetheart deal?

Answer 25

employer signs up employees to be part of a trade union so long as the union causes no problems. often used in supermarkets e.g SDA

Question 26

What is the organzing strategy?

Answer 26

where union empowers members to solve their own workplace issues, a form of participatory democracy e.g MUA, AMIEU, ETU
can be used in combination with servicing e.g. the ETU

Question 27

What is community unionism?

Answer 27

where trade unions work with community groups to achieve social, political and industrial objectives

Question 28

Employers and ER strategy summary

Answer 28

Employers and managers in Australia are caught between 2 approaches to strategic ER. There is a return by organisations such as Orora and Sydney Water to a positive pluralist approach while others such as RIo Tinto, Qantas, Grocon, G&K O’Connor want to deunionise and adopt a unitaritst approach to managing ER

Question 29

Employer Associations and ER Strategy summary

Answer 29

Employer association have emerged from being reactive associations for most of the 20th century to being proactive associations engaging with their external enviorments and their members to achieve new and ongoing objectives

Question 30

Trade Unions and ER Strategy summary

Answer 30

Trade unions have also been seen to be reactive but have in fact a range of strategies from which to choose: artibrat, political, legal, industrial, organizing, sweetheart deals or a combination of the above depending on the crcumstances.