Building High Performance Work Systems
LHRP 424
Monday 8:15-10:15 PM
Professor Gil Preuss
Enterprise 516
368-0799
Purpose and Course Description:
The term “high performance work system” frequently appears in the management literature referring to a broad array of human resource practices, production and organizational strategies, and work organization methods. In this course, we focus on how different organizational characteristics fit together with each other, the work to be accomplished, and organizational strategy to shape outcomes and build organizational performance. By the end of the semester, students are expected to understand the components of high performance work systems, how they fit together, how they fit with broader organizational factors, and issues in their adoption and implementation. In addition, students should be able to analyze a work “production process” and develop specific ideas on how to transform it into a high performance work system.
As used in this course, the term “high performance work system” (HPWS) refers to several critical organizational characteristics that together have been shown to improve firm performance. These characteristics include:
1) A philosophy that sustainable competitive advantage can be achieved through the use of people as competitive assets;
2) A reorganization of work structures (e.g., greater use of teams and other small group activities) and processes (e.g., focus on process flow rather than functional development) to maximize organizational learning and customer responsiveness;
3) A set of human resource policies - from selection to training to incentive structures and career paths - that seek to build employees’ motivation, skills, commitment, flexibility, and align individual interests with those of the organization; and
4) New approaches to managing (or leading) employees that are consistent with these philosophies, work reorganizations, and policies.
The course is divided into three distinct sections. The first section is an introduction to high performance work systems. In this section we will address the history of work systems as well as address the overall characteristics of creating a HPWS. It introduces the “set” of practices that together comprise today’s high performance systems as well as the logic that integrates practices into a high performance system. We will also begin addressing the performance outcomes of alternative work systems.
The second section of the course looks inside the “black box” of high performance work systems by examining its key components. Separate classes within this section focus on teams, organizational learning, compensation systems, and psychological contracts with employees. Within each section articles are included to raise questions about the value and desirability of such practices on outcomes for employees. These issues are raised more explicitly in the final class of this section focusing on outcomes for organizations and employees.
The final section of the course looks outside the work systems focusing on linkages with production and business strategies, national cultures and systems, and external stakeholders. These classes raise questions about the ability and desirability for firms to adopt high performance work systems.
The class stands at the intersection of several topics and themes addressed in courses at Weatherhead. The class integrates an understanding of organizations, human resources, and organizational strategy to focus on a specific set of practices shown to result in better organizational performance. In addition, by comparing practices in different countries the course addresses international management issues.
Participation
Everyone is expected to come to class fully prepared to participate in the discussion. Participation means contributing to class discussion, pushing ideas forward, and challenging the ideas raised in class. It does not mean speaking all the time. While preparing for class, think of questions you would like addressed both from a practical and theoretical perspective. Despite the fact that this class focuses on a specific set of practices, no single system fits all organizations. Throughout the course, I will challenge you to think of the critical factors determining which characteristics would result in improved outcomes in different settings. We will try to understand what is the “logic” of the practices observed and what are the sources of variation from this “logic.”
Reading list
Course work will include a combination of readings from various sources as well as several cases for class discussion. Most readings are included within the CWRUnotes. One book is required for the class: The Human Equation, by Jeffrey Pfeffer. Additional material (listed in the syllabus) will be distributed during the semester. The intention is to analyze a series of organizations, production systems, and national contexts to illustrate the tensions and dynamics of high performance work systems.
Course Requirements
1) Class participation - Participation will be evaluated on the
basis of contribution to class discussion. 30% of total grade
2) 4 short write-ups. Each assignment will be 2-3 pages
in length summarizing key issues and raising critical questions.
You are permitted to discuss the issues in groups. Each person
is responsible for an individual case write-up. Two write-
ups are assigned for all students with the other two selected
from remaining cases by each student. 20% of total grade
3) A 15-20 page group paper focusing on an organization
through the lens of HPWS. Due November 26. 30% of total grade
Each team is responsible for a 1-2 page write-up describing
their data collection strategy for the final paper. Due October 15.
4) A final exam based on an individual case analysis - This
will be an in class exam based on a case distributed one week
before the exam. 20% of total grade
Late Policy
No individual case write-ups will be collected following the case discussion in class. If you are away, it is your responsibility to make sure that I receive the case by e-mail or fax by the same time.
Week to Week Outline Of Course
Section 1: Introduction To High Performance Work Systems
August 27 - Introduction
Lawler, E.E. “Make Management an Advantage.” Chapter 1 from The Ultimate Advantage: Creating the high Involvement Organization. 1992.
Pfeffer, J. “Looking for Success in All the Wrong Places.” Chapter 1 From The Human Equation, 1998.
Case: Chaparral Steel: Rapid Process and Product Development
Case Questions:
1) The management of Chaparral steel considers one of the company’s competitive capabilities to be the rapid translation of technology into product. What makes up that capability? That is, what about the corporate culture, the management systems, physical equipment, and employee skills that enable Chaparral to innovate rapidly?
2) Chaparral’s top management team feels that the company must grow. What is your opinion and why? If you agree, how should they go about it?
September 3 – NO CLASS – Labor Day
September 10 – Work Organization, Work Reform, and High Performance Work Systems
Smith, Adam – The Wealth of Nations, chapter 1 “of the division of labour.”
Taylor, F. - from Scientific Management, 1911, skim pages 30-64.
Hackman, Richard, et al., “A New strategy for Job Enrichment.” California Management Review. 1975.pp 57-71
Pfeffer, J. – “Seven Practices of Successful Organizations.” Chapter 3 from The Human Equation. 1998
Assignment:
1) Each student is responsible for a brief analysis (3-4 pages) of a current / previous job on the basis of the issues raised in the readings. In addition, please consider under what circumstances you have felt most energized in your job or where you have performed the best in your job.
2) Form groups for semester project.
September 17 – HPWS In Context – A comparison of two sites, one company
Case Analysis: Motorola – Elma
Motorola – Penang
Assignment:
1) 3-4 page case analysis comparing Motorola – Elma and Motorola – Penang.
· What have been the strategies adopted in the two plants to achieving high performance?
· What are the similarities and differences between the two plants in this regard?
· What has led to the observed similarities and differences?
· Would you consider both to be high performance work systems? Are both strategies equally viable for long term continuous improvement? Please explain.
Please provide details from the cases to support your view.
Section 2: Components Of HPWS
September 24 – The Psychological Contract” With Employees
Pfeffer, J. “The new employment contract and the virtual work force.” Chapter 6 from “The Human Equation. 1998
Case: PP&G: Developing a Self-Directed Work Force (A)
Case questions:
1) What are the components of the psychological contract between employees and management at the Berea plant?
2) What is the source of this psychological contract?
3) What developments challenge this contract?
4) What can management do to address these developments? Please be specific.
For class discussion, please consider what is required to change a traditional relationship or psychological contract at work to one based on greater autonomy and individual responsibility. You may want to consider any personal experiences with this.
October 1 – Organizational Learning
Garvin, David, “Building a Learning Organization” – Harvard Business Review, July-August, 1993
Hart, Christopher, “The Power of Unconditional Service Guarantees”, Harvard Business Review, July-August, 1988, pp. 54-62.
Case: Adler and Cole. Comparing NUMMI and Uddevalla
Case questions:
1) How does learning occur in the two plants? In other words, who / what learns and how is this embedded in the organization?
2) What organizational systems support organizational capacity to learn?
3) Given these cases and the material in the other readings, does organizational learning require “stress” on the system or can other mechanisms be established? Try to be specific and give examples based on the readings or your own experiences when relevant.
October 8 – Teams and Learning in Organizations
Ashkenas, R., D. Ulrich, T. Jick, S. Kerr, “Orient Work Around Core Processes” and “Tackle Processes Through Targeted Teams” from The Boundaryless Organization., 1995, pp. 145-163.
Case: Massachusetts General Hospital: CABG Surgery
Case questions:
1) What are the primary challenges in improving operating processes in a health case environment such as that of MGH?
2) How should MGH balance the tension between process standardization and process customization? What are the hazards of standardizing the process too rigorously? What are the dangers of allowing too much freedom to customize?
3) What role could/should teams play in continuously improving the operating processes?
In addition, everyone should consider the following two questions:
1) What kind of improvement would you expect to result from these process improvements? Who would be the beneficiary of such improvements?
2) What implementation approach should Bohmer and Torchiana select? Where would you start, what resources would you bring to bear, what performance would you expect, what timeline would you hope to follow?
October 15 – Managing Knowledge in Organization
Hansen, M. T., N. Nohria, and T. Tierney – “What’s Your Strategy for Managing Knowledge?”, Harvard Business Review, March-April, 1999, pp. 106-116.
Cerney, K., “Making Local Knowledge Global,” Harvard Business Review, May-June, 1996, pp. 22-26. This article is a case on Lexington Labs and the challenges they face.
Case questions:
1) Consider the alternative proposed for addressing the challenge in the case on Lexington Labs. Given the issues raised in the case and the advise of the five experts, what recommendations would you make to David Martin?
2) In considering your recommendations, make sure to address the competing suggestions made as well as other potential concerns raised.
In addition, please consider the following:
1) What is the most critical knowledge in your organization in shaping organizational performance? What is the nature of this knowledge? Where is it located? What challenges exist regarding the management and transfer of this knowledge? How would you propose to transfer this knowledge and maximize its value to the organization?
Due: A 1-2 page write-up for each team describing the data collection strategy for the final paper.
October 22 – Does High Commitment = High Stress? Organizational vs. Individual Perspectives on HPWS
Babbar, S. and David Aspelin, “The overtime rebellion: Symptom of a bigger problem?” Academy of Management Executive, 1998, pp. 68-76.
Case: Nordstrom: Dissension in the Ranks? (A)
Case Questions:
1) What is the cause of the problems described in the case? How serious are these problems?
2) Are Nordstrom employees pressured inappropriately by the sales-per-hour system? By management?
3) How effective is the memo reproduced as Exhibit 3 in clarifying the distinction between “sell” and “non-sell” time?
4) How would you change the management systems at Nordstrom?
Section 3: Beyond The Work System
October 29 – - Business Strategy And HPWS
Pfeffer, J. “Aligning business strategy to management practices.” Chapter 4 from The Human Equation
Burrows, Peter. “The Radical: Carly Fiorina’s Bold Management Experiment at HP” BusinessWeek, February 19, 2001. pages 70-80.
Case: Human Resources at Hewlett-Packard (A)
Case Questions
1) What is the HP way? How do HP’s values, culture, human resource policies, and management practices support the HP way?
2) Why does the task force believe that HP is losing its human touch? Are they justified in their conclusion? Will changes HP made in the 1980s cause permanent damage to the HP way? Will they affect the company’s effectiveness in the long run?
3) What should Lew Platt do about the task force’s concerns?
4) Are concerns by Samsung about the applicability of the HP way in Korea justified? Should HP accede to Samsung’s pressure to abandon the HP way in Korea?
5) What do you recommend Lew Platt do about pressures from the businesses to go their own way in strategy and management practices?
November 5 - Leadership in HPWS
Bartlett and Ghoshal, “Changing the Role of Top Management: Beyond Systems to People,” Harvard Business Review, May-June, 1995, pp. 132-142.
Senge, P. “The leader’s new work: Building Learning Organizations” Sloan Management
Review, 1990.
Case: NYPD New
Case Questions:
1) What is the source of success for the New York City Police Department?
2) What was the role of department leadership in shaping this outcome?
3) What challenges face the department as it tries to move forward and continue its success?
4) What specific steps would you propose for the leadership to address these challenges and build on their successes?
November 12 – Technology and Human Resource Systems