© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Creating High-Performance Work Systems 1–1 The Challenges of Human Resources Management

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 2 of 32 High-Performance Work Systems (HPWS) HWPSHWPS  Is a specific combination of HR practices, work structures, and processes that maximizes employee knowledge, skill, commitment, and flexibility.  Is composed of many interrelated parts that complement one another to reach the goals of an organization, large or small.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 3 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 4 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 5 of 32 Fundamental Principles Egalitarianism and EngagementEgalitarianism and Engagement  Egalitarian work environments eliminate status and power differences and, in the process, increase collaboration and teamwork.  When this happens, productivity can improve if people who once worked in isolation from (or opposition to) one another begin to work together.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 6 of 32 Fundamental Principles (cont.) Shared InformationShared Information  A shift away from the mentality of command and control toward one more focused on employee commitment.  Creating a culture of information sharing where employees are more willing (and able) to work toward the goals for the organization.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 7 of 32 Fundamental Principles (cont.) Knowledge DevelopmentKnowledge Development  Employees in high-performance work systems need to learn in “real time,” on the job, using innovative new approaches to solve novel problems  The number of jobs requiring little knowledge and skill is declining while the number of jobs requiring greater knowledge and skill is growing rapidly.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 8 of 32 Fundamental Principles (cont.) Performance-Reward LinkagePerformance-Reward Linkage  It is important to align employee and organizational goals. When rewards are connected to performance, employees will naturally pursue outcomes that are mutually beneficial to themselves and the organization.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 9 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 10 of 32 Complementary Human Resources Policies and Practices Staffing Practices Training and Development Compensation

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 11 of 32 Management Processes and Leadership Success of any high-performance work system depends on first changing the roles of managers and team leadersSuccess of any high-performance work system depends on first changing the roles of managers and team leaders With fewer layers of management and a focus on team-based organization, the role of managers and supervisors is substantially different in an environment of high-performance work systems.With fewer layers of management and a focus on team-based organization, the role of managers and supervisors is substantially different in an environment of high-performance work systems. Managers and supervisors are seen more as coaches, facilitators, and integrators of team efforts.Managers and supervisors are seen more as coaches, facilitators, and integrators of team efforts.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 12 of 32 Supportive Information Technologies Must be added to the framework of high performance work systemsMust be added to the framework of high performance work systems Sharing information vital to business performanceSharing information vital to business performance High-performance work systems cannot succeed without timely and accurate communicationsHigh-performance work systems cannot succeed without timely and accurate communications Typically the information needs to be about business plans and goals, unit and corporate operating results, incipient problems and opportunities, and competitive threatsTypically the information needs to be about business plans and goals, unit and corporate operating results, incipient problems and opportunities, and competitive threats

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 13 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 14 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 15 of 32 Testing the Alignment of the HR system with HR Deliverables (cont.)

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 16 of 32 Testing the Alignment of the HR system with HR Deliverables (cont.)

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 17 of 32 Fitting It All Together The HR ScorecardThe HR Scorecard  Assessing Internal fit – Do all internal elements of the HR system complement and reinforce one another?  Assessing HR Practices – Do HR practices significantly enable key workforce deliverables such as employment stability and teamwork?  Assessing External Fit – Are workforce deliverables connected with key strategic performance drivers?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 18 of 32 Implementing the System Necessary Actions for a Successful HPWS:Necessary Actions for a Successful HPWS:  Ensure that change is owned by senior and line managers.  Allocate sufficient resources and support for the change effort.  Ensure early and broad communication.  Ensure that teams are implemented in a systemic context.  Establish methods for measuring the results of change.  Ensure continuity of leadership and champions of the initiative.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 19 of 32 Implementing High-Performance Work Systems

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 20 of 32 Building Cooperation with Unions

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 21 of 32 Navigating the Transition to High-Performance Work Systems Navigating the TransitionNavigating the Transition  Ongoing activity - never fully completed  Best results occur when managers and employees work together  The top down approach communicates manager support and clarity, while the bottom-up approach ensures employees accept and are committed to the approach Building a Transition StructureBuilding a Transition Structure  Establishing an implementation plan that provides a timetable and process for mapping key business processes, redesigning the work flow, and training employees can keep the effort from bogging down

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 22 of 32 Incorporating the HR Function as a Valuable Partner Recruiting, evaluation, and reward systems devised by HR groups can have a huge impact on how well high-performance work systems are implemented.Recruiting, evaluation, and reward systems devised by HR groups can have a huge impact on how well high-performance work systems are implemented. HR managers are in a good position to help employees in transition handle what they are going throughHR managers are in a good position to help employees in transition handle what they are going through

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 23 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 23 of 32 Evaluating and Sustaining the Success of the System Process Audit – Questions?Process Audit – Questions?  Are employees actually working together, or is the term “team” just a label?  Are employees getting the information they need to make empowered decisions,  and are they engaged?  Are training programs developing the knowledge and skills employees need?  Are employees being rewarded for good performance and useful suggestions?  Are employees treated fairly so that power differences are minimal?

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 24 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 24 of 32 Evaluating and Sustaining the Success of the System (cont.) Is the program succeeding? – Questions?Is the program succeeding? – Questions?  Are the behaviors the organization desires being exhibited on the job?  Are quality, productivity, flexibility, and customer service objectives being met?  Are quality-of-life goals being achieved for employees?  Is the organization more competitive than in the past? Implementing an HPWS is one thing. Sustaining it is another.Implementing an HPWS is one thing. Sustaining it is another.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 25 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 25 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 26 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 26 of 32

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 27 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 27 of 32 Outcomes of High-Performance Work Systems Employee Outcomes and Quality of Work LifeEmployee Outcomes and Quality of Work Life  More involved in work  More satisfied and find that needs for growth are more fully met  More informed and empowered, feel that they have a fuller role to play in the organization and that their opinions and expertise are valued more  Have a greater commitment that comes from higher skills and greater potential for contribution

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 28 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 28 of 32 Outcomes of High-Performance Work Systems (cont.) Organizational Outcomes and Competitive AdvantagesOrganizational Outcomes and Competitive Advantages  Higher productivity  Lower costs  Better responsiveness to customers  Greater flexibility  Higher profitability

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 29 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 29 of 32 Organizational Outcomes and Competitive Advantages Competencies in must have the following qualities:Competencies in must have the following qualities:  Valuable: High-performance work systems increase value by establishing ways to increase efficiency, decrease costs, improve processes, and provide something unique to customers.  Rare: High-performance work systems help organizations develop and harness skills, knowledge, and abilities that are not equally available to all organizations.  Difficult to imitate: High-performance work systems are designed around team processes and capabilities that cannot be transported, duplicated, or copied by rival firms.  Organized: High-performance work systems combine the talents of employees and rapidly deploy them in new assignments with maximum flexibility.

© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 30 of 36 © 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 30 of 32 Key Terms high-performance work systemhigh-performance work system (HPWS)(HPWS) internal fitinternal fit external fitexternal fit process auditprocess audit