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The PRO-Productivity System (tm)

THE MANAGEMENT ROUNDTABLE

The second planning phase of the PRO-Productivity System (tm) thus engages the management team alone in a workshop. The very process of determining how best to encourage greater employee involvement in concrete productivity enhancement projects is used to illustrate and practice participatory decision making. The product of the Roundtable is a kind of homework assignment for the management group which grows out of the issues identified in exercises on some or all of the following topics:

  • Identify the company's current Management Style. Exercises based upon Likert's, MacGregor's & Ouchi's models from command and control to consensus decision-making. Where do the company's managers fit on the scale from Ghengis Khan to Mr. Rogers? How appropriate are the current habits of leadership? Are job functions, decision-making authority and responsibility clearly articulated? How do employees know they have succeeded? Design an ideal management style that fits the potential of the business and the talents and idiosyncrasies of its people.
  • Focus on the Cost Structure of the business. Where do the profits really come from? How much potential does there appear to be for employees to increase productivity? Identify the current level of employee participation/autonomy/awareness of the cost structure. Do employees have enough information to modify their behavior in search of higher profits? Is there a need for employee education regarding basic financial principles and the cost structure of this particular business? Design an ideal relevant feedback system which would permit people to react quickly to significant profit opportunities or cost overruns.
  • Focus on the Organizational Structure of the business: Does the current structure facilitate or impede information flow and decision-making? Does the company do strategic planning? Do employees work to a plan? Are there different functional departments or operating divisions which present distinct communication problems? How do they interact now? Is there too much insularity and not enough mutual support? Do most employees speak English? How will the productivity process deal with linguistic and cultural differences? Would strategic business unit organization and accounting principles enhance productivity? Design an ideal reporting and responsibility structure which would facilitate efficient operations at the lowest cost.
  • Evaluate Compensation Techniques: Do current compensation structures match responsibility and risk? What should the balance be between short- and long-term compensation, between base compensation and performance-based compensation. What is the realistic potential of the company's stock? Will the amount of stock targeted for ESOP ownership constitute an inadequate, appropriate, or excessive foundation for the productivity enhancement program? Should the existing cash bonus system, if any, be integrated with the ESOP such that some of the cash bonus is paid out to plan participants in the form of tax-deductible "dividends" allocated according to the number of shares in a participant's account? Design an ideal compensation scheme.
  • Explore Productivity Enhancement Techniques used by existing successful ESOP companies as alternatives to consider: What level of employee involvement should be targeted initially? Should communication be limited to top-down education at first? What kind of bottom-up information channels exist now? Could autonomous decision-making be forced downward in the organization? Should it be? How should success be recognized and measured? Design an ideal employee communications program that is consistent with the goals of the plan.

A single day's workshop will not accomplish a change in corporate culture. The Management Roundtable does, however, help management to identify the company's current unconscious habits and explore alternatives which might enhance long-term productivity. The experience of the Menke facilitator leading the workshop provides perspective and serves as a catalyst to help the management team focus on issues they have long recognized, but perhaps failed to articulate. There is no magic in the system except that it provides a forum, a structure for the people actually working in the company to take stock of their situation in a systematic way. This kind of stock-taking is just as crucial to the PRO-Productivity System (tm) as the financial kind of stock. The goal of the Roundtable is to leave the management team with a pile of unfinished planning tasks and a format for working them out during several ensuing weeks.

During the workout phase of the program, then, managers themselves may consider whether any of their current habits contribute towards what Malcolm G. Putnam, President of Oregon Steel, calls "the We-They Syndrome between management and labor."15 They can experiment in developing effective group dynamics among themselves, learn consensus-building skills and communication techniques, and perhaps modify the subtle hurdles which could sabotage from the start the message "We're all in this together."

The final objective of that long workout process is to establish the shape of the employee productivity enhancement program: what are its proximate and long-term goals. How should the company begin and how can it recognize success? Recognizing that you get what you measure and reward, how should the company's reporting and compensation systems be modified to encourage productivity growth?

As an equally important objective, the workout period also gives managers time to develop their own commitment to the employee participation process. On rare occasion, the decision is made at this point to postpone further employee involvement indefinitely. Unless and until managers are comfortable with the selected employee participation techniques, the plan will start out as someone else's pet project and probably finish as nobody's baby.

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