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Chapter 16: Implementing HR Strategy: High-Performance Work Systems: 16.4c Evaluating and Sustaining the Success of the System Book Title: Managing Human Resources Printed By: Cedric Turner ([email protected]) © 2016 Cengage Learning, Cengage Learning

16.4c Evaluating and Sustaining the Success of the System

Once high-performance work systems are in place, they need to be monitored and evaluated over time. First, there should be a process audit (Determining whether the high- performance work system has been implemented as designed) to determine whether the system has been implemented as it was designed and whether the principles of high- performance work systems are being reinforced. Questions such as the following might be included in the audit:

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?

Second, the evaluation process should focus on the goals of high-performance work systems. To determine whether the program is succeeding, managers should look at metrics such as the following:

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. As with any change activity, there will be missteps during the system’s implementation for any number of reasons. Xerox Corporation found that when it implemented teams without also changing the compensation system to support teamwork, it got caught in a bad transition. The teams actually showed poorer performance than did employees working in settings that supported their individual contributions. Xerox’s executives concluded that they needed to change the entire system at once because piecemeal changes were actually detrimental. In other words, building and fostering high-performance work systems must be an ongoing activity. Perhaps the job is never fully completed.

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Moreover, even though an HPWS can increase employee satisfaction and engagement, because the work teams in such a system are performing at their peak, burnout can be an issue. For example, employees of Facebook are the youngest and most satisfied of workers in big U.S. tech firms, but a recent survey found they are also the most stressed out. If there are not enough staff members to manage the volume of work, stress is almost guaranteed.

Employee poaching by competitors can be an issue, too. Motorola’s Indian division discovered this firsthand. The division strategically recruited its employees and put together a high-performance work system, thereby capturing a significant amount of India’s mobile device business. Later the division discovered that its employees were being hotly sought after by other companies such as Nokia. Consequently, Motorola had to look for new ways to retain and motivate the division’s workforce.

Finally, high-performance work systems should be periodically reevaluated in terms of new organizational priorities and initiatives. Because a high-performance work system is built to deliver value to customers and thereby increase a firm’s strength, as their needs change, so too should the system. When change occurs, it should be guided by a clear understanding of the business needs and exhibit a close alignment with strategy.

Small Business Application

Are Your Employees Engaged, or Do You Need an HPWS?

Companies with disengaged workforces suffer from problems that do not seem to get better, including excessive employee turnover, lower productivity, and profits. When employees are engaged, however, the results can be much different. One Gallup study reported that firms with top engagement scores had 18 percent higher productivity and 16 percent higher profitability. According to a study by the Corporate Executive Board, engaged employees outperform average employees by 20 percent and are 87 percent less likely to leave their organizations than highly disengaged employees. Because there simply is not enough margin for error when it comes to performance in today’s highly competitive environment, in a small business, engagement can have an even bigger impact.

As a small business owner, how do you know if your employees are engaged or not? One way would be to survey them. Gallup has come up with a 12-question survey designed to gauge employee engagement that includes:

Do you have the materials and equipment you need to do your work right?

At work, do you have the opportunity to do what you do best every day?

In the last seven days, have you received recognition or praise for doing good work?

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Does your supervisor, or someone at work, seem to care about you as a person?

Is there someone at work who encourages your development?

At work, do your opinions seem to count?

Barb Taylor Krantz, the author of HR Professionals, Leadership, Personal Growth, has a better idea about how to measure engagement: Why not just talk to your employees? There is no way a CEO of a large company could talk to all of the firm’s employees. Small businesspeople have that luxury. Do not do it during a performance evaluation but during a relaxed and casual conversation, Clough suggests. Ask employees to talk about why they work for your organization, what motivates them to achieve, and what success on the job looks like. Which aspects of their jobs are most satisfying, and how could they contribute more in those areas? What challenging goals can they set for their own development? If they cannot answer these questions, chances are good that they are not engaged.

So how can you increase the engagement of employees other than by asking them to work harder than they already are? Simply looking for a quick fix to engagement is not likely to be a solution because engagement is a measurement. “People who think their holy grail is increasing their employee engagement score are sorely mistaken,” says HR blogger Gautam Ghosh. “For world-class companies like Southwest Airlines, employee engagement is a way of life that’s taken them years to build into their cultures. It’s not a strategy or program to them. It’s just part of their corporate DNA.”

Thus, what you may need to do as a small business owner is look at the culture of your firm, rethink how you operate, and implement the concepts in this chapter. In addition to the suggestions in this chapter, two good publications that can help a small business person implement an HPWS are The HR Scorecard: Linking People, Strategy, and Performance by Dave Ulrich, Mark A Huselid, and Brian E. Becker, and The Power of Full Engagement: Managing Energy, Not Time, Is the Key to High Performance and Personal Renewal by Jim Loehr and Tony Schwartz. As this chapter has explained, research has shown that high-performance work systems can successfully be used by small- and medium-sized organizations as well large ones.

Sources: Barb Krantz Taylor, “Are Employees Going Above and Beyond?” The Bailey Group (July 10,

2009), http://www.thebaileygroup.com; “The Backlash against Employee Engagement,” RiseSmart (April

2, 2010), http://www.risesmart.com.

Chapter 16: Implementing HR Strategy: High-Performance Work Systems: 16.4c Evaluating and Sustaining the Success of the System Book Title: Managing Human Resources

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Printed By: Cedric Turner ([email protected]) © 2016 Cengage Learning, Cengage Learning

© 2020 Cengage Learning Inc. All rights reserved. No part of this work may by reproduced or used in any form or by any means - graphic, electronic, or mechanical, or in any other manner - without the written permission of the copyright holder.