This article will outline a number of issues for organisations to consider when pursuing sustainable high performance workplace outcomes through high involvement management (HIM) initiatives and identifies those outcomes which reinforce corporate profitability and corporate survival, and those that satisfy employee aspirations and needs in the workplace. Organisational reform in Australia has resulted in a greater focus on relations between management and employees at organisational and workplace level. The stimulus has been the search for greater efficiency and productivity. Leaders in government, business and unions have agreed that improved human resource management (HRM) is pivotal, but such views have not necessarily been matched by the commitment of management attention, time and resources to HRM at the workplace. Evidence suggests that high-quality employee participation and involvement at the workplace constitutes a HIM approach leading to greater organisational productivity and effectiveness. However, it is also acknowledged that a high performance workplace approach through the application of HIM strategy poses a number of challenges and dangers which need to be addressed.

Keywords: employee involvement, high involvement management, high performance work systems,

human resource sustainability, organisational performance

Firms are facing an increasing struggle to gain competitive advantage in a much larger and more demanding marketplace. Markets stretch across international boundaries, trade barriers have crumbled and distribution channels have become more efficient. State intervention in many markets has diminished and many organisations confront increasing number of competitors. In addition,

Correspondence to: Paul J. Gollan, The London School of Economics, Department of Industrial Relations, Houghton Street, London WC2A 2AE, UK; e-mail: [email protected]

Asia Pacific Journal of Human Resources. Published by Sage Publications (London, Thousand Oaks, CA and New Delhi; www.sagepublications.com) on behalf of the Australian Human Resources Institute. Copyright © 2005 Australian Human Resources Institute. Volume 43(1): 18–33. [1038-4111] DOI: 10.1177/1038411105050305.

Asia Pacific Journal of Human Resources 2005 43(1)

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 18

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

consumers demand higher quality products and services than before, delivered faster, and at a lower price (Flood, Gannon and Paauwe 1995; Gollan 1995).

As a means to confront these challenges, a greater focus has been placed on management strategies to increase organisational productivity and effi- ciency at the workplace. A plethora of terminology has been created to refer to aspects of more highly developed human resource management (HRM) approaches or high performance work systems (HPWS) (Becker and Huselid 1998). These strategies have been labelled high performance workplaces, high commitment management (HCM) and more lately, HIM (Lawler 1992; Lawler, Mohrman and Ledford 1995; Levine 1995; Wood and Albanese 1995; Wood and De Menezes 1998; Wood 1998). Equally important is guaranteeing employees access to due process and providing a means to be heard (Walton 1985, 79–80). Above all, the HIM strategy involves policies that promote mutual influence, mutual respect and mutual responsibility (Wood 1996, 514).

HIM is designed to improve employee relations and increase organisa- tional performance and profitability through quality communication and consultation between management and employees. As part of this strategy, jobs are designed to be broader, and combine planning and implementation. Individual responsibilities are expected to change as conditions change, and teams rather than individuals are the organisational units accountable for performance. In addition, differences in status are minimised, with control and lateral co-ordination based on shared goals and understandings. There is thus an alignment of interests with expertise, rather than formal position or title determining influence and power.

It has been argued that many of these strategies have been rooted in the human relations movement of the 1930s (Cully 1998, 69). However, what can be identified in these strategies is the adoption of an integrated approach of innovative work practices and high employee involvement, encouraging higher commitment and increased organisational and workplace performance. Common to all approaches is the heavy emphasis on integration of business and employee relations strategy, and employee and management co-operation for the achievement of organisational goals. However, two models have been apparent. Normative models have stressed integration and co-operation through employee involvement and participation, recognising the needs of the individual as a means to achieve increased productivity. Alternatively, descrip- tive or functional models have used HRM as a management tool or strategy in the pursuit of organisational aims with the main function of HRM being to ensure the efficient allocation of resources.

HIM is premised on the belief that it will have positive effects on key performance variables: increased labour productivity, lower labour turnover and less absenteeism, greater output and a generally improved and flexible workplace culture. Wood (1998) suggests a contingency hypothesis stating that environmental and strategic factors will moderate the relationships between a system of HIM and performance variables. The other important aspect of this

High involvement management and HR sustainability 19

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 19

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

relationship is strategic integration of work practices and HIM and a strategic alignment with total quality management (TQM) (Kochan and Osterman 1994). In essence, the HIM approach involves an examination of the extent to which high involvement practices tend to co-exist and the managerial attitudes that are associated with their application.

HIM practices have been commonly referred to as part of a strategic approach to human resource management, though there is some debate over how this compares to traditional industrial relations approaches to people management. Nevertheless, a high degree of consensus exists on the need for co-operation between management and employees for the success of HRM strategies. Research also suggests that this co-operation relies upon building employee satisfaction and commitment through effective employee participa- tion processes (Guest and Peccei 1998).

General survey evidence shows there is much employee involvement and participation taking place in Australian workplaces (Campling and Gollan 1999; Morehead et al. 1997, 244). However, other findings have found little evidence of comprehensive employee involvement in organisational decision- making, suggesting that the rhetoric of greater empowerment of the workforce has not been matched by the experience (ACIRRT 1999). It has been argued that empowerment is often an illusion used by management solely as a tool for cost-cutting purposes. While current evidence suggests that little attempt has been made to introduce an integrated employee participation and involvement approach in Australian workplaces, case studies in Australia demonstrate that such an approach can achieve higher levels of performance (Campling and Gollan 1999).

At the same time as the policy debate over the degree of collective bargaining and decentralisation has taken place in Australia, considerable discussion has occurred in Australian academic and political circles about the impact of unions on the pattern of industrial relations at the workplace. These debates suggest ways in which we might expect to observe different industrial relations structures and processes in union and non-union workplaces. However, less attention has been given to the way in which different levels of employee involvement and consultation affect workplace relations, and in particular the degree of involvement and participation that employees have over the decision-making processes in new environments.

It has been argued that the shift towards greater non-union employee relations in Australia has also meant that there needs to be alternative institu- tional arrangements for employees to have a ‘voice’ in the workplace through greater participation and involvement. Some employers have always viewed the removal of trade unions as a prerequisite for successful performance in increasingly competitive domestic and international markets. However, the demise of trade unions has left a void in terms of ‘voice mechanisms’ available to employees. Evidence from a study of non-union workplaces by Campling and Gollan (1999) suggests there is greater satisfaction with management and

20 Asia Pacific Journal of Human Resources 2005 43(1)

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 20

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

greater employee commitment if participation and involvement of employees is sought. However, the research noted that the lack of a readily defined collec- tive structure in non-unionised workplaces. What has emerged from recent changes in the workplace is the importance of employee involvement and participation in achieving successful organisational change. Creating and developing an organisational culture that provides a foundation for positive organisational change may involve a considerable investment of management time and resources. But the link between such change and employee involve- ment arrangements is clear from a number of studies (Fernie and Metcalf 1995; Geary and Sisson 1994; Gollan and Davis 1998; Gollan and Davis 1999). Where there is a lack of participation structures, especially in the growing non- unionised sector, a greater emphasis is placed upon management’s ability to implement change processes.

As part of the organisational change process, when companies adopt more flexible forms of organisation in response to shifts in environmental conditions, there is a risk that the change in process and culture may be misunderstood. For example, employees may see new processes as simply an intensification of their workload rather than an enhancement of their skills and experiences. It is essential for organisations to allay employees’ fears and anxiety by devel- oping a set of policies and procedures to manage the change. Research shows that many organisations do not formally involve employees until the later stages of change, once management has clearly established how the new initia- tives will be implemented (Gollan 2000; Millward, Bryson and Forth 2000; Terry 1999). A more integrated consultative and participative approach would demand that employees be involved in organisational change from the outset, rather than just during implementation.

Underlying such processes are management attitudes. Some studies have also identified managerial attitudes as key to the existence of highly developed employee involvement practices (Fenton-O’Creevey, Wood and Callerot 1998; Kessler, Jennings and Undy 2000; Millward, Bryson and Forth 2000; Wood and Albanese 1995; Wood and De Menezes 1998). Underpinning such practices is a relationship based on a high level of trust between management and employees. It is assumed that employees can be trusted to make important workplace decisions that will result in greater productivity and effectiveness. Employees are therefore given the opportunity to develop their knowledge and skills so that they can make these decisions. Such an integrated approach incorporates employee involvement and participation in all aspects of the organisation’s planning and implementation processes.

In addition, related to information and employee consultation, Freeman (2001) suggests that information and consultation mechanisms are more likely to exist in firms that have introduced profit-sharing and share option plans. His research shows that joint consultative committees, quality circles and company-level information and consultation processes with workers are much more widespread among firms with shared compensation systems (any form

High involvement management and HR sustainability 21

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 21

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

High involvement management and organisational performance

of variable pay such as performance-related pay and share ownership schemes) than they are in other firms. Freeman (2001, 27) argues that:

This robust relationship fits well with economic logic. If an employer pays workers in ways that depend on business performance, it should benefit from communicating about that performance and should offer workers ways to contribute to improving performance. Conversely, firms that give workers greater decision-making authority at their workplace should also want to give them incentives to make decisions in the interests of the business.

Research also highlights that such integrated approaches need to be embedded in the workplace culture of an enterprise, and that this culture dictates the way that employees are consulted (Gollan and Markey 2001).

HIM also emphasises high trust relations between management and employees. In particular, it is based on the assumption that employees can be trusted to make important workplace decisions. In addition, employees can develop their knowledge and skills to make important decisions about the management of their work activities, resulting in greater productivity and effectiveness (Wood 1998; Lawler, Mohrman and Ledford 1995; Osterman 1994). The HIM approach can be seen as a management initiative based on relationships between management and employees in the organisation through employee involvement and participation, with the objective of increasing organisation performance and greater cost efficiency.

There is considerable evidence that an integrated approach to employee par- ticipation can achieve higher levels of performance (EPOC Research Group 1997; Fernie and Metcalf 1995; Gollan and Davis 1998; Guest and Peccei 1998; Knell 1999). In addition, research shows that comprehensive employee involve- ment and participation in employee relations policies and practices have the potential to make an important contribution to organisational competitiveness. The problem for many organisations is that human resource managers and professionals often find it difficult to convince senior management executives that progressive HR strategies make a difference due to the intangible nature of the benefits of many HR programs and the long timeframe for any efficiency gains to become apparent (Dunphy, Griffiths and Benn 2003). As Dunphy and colleagues suggest, the contrast is often expressed in terms of short-term cost efficiencies but medium to long-term negative impact (as in the case of down- sizing) versus short-term increased costs (such as in training and development) and medium to long-term benefits (Dunphy, Griffiths and Benn 2003).

22 Asia Pacific Journal of Human Resources 2005 43(1)

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 22

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

However, evidence now demonstrates that companies that do invest in people, rather than just talk about it, show positive financial outcomes.

For example, a comprehensive study by Patterson et al. (1997) has recon- firmed the importance and linkage of good people management practices to productivity and profits. The study showed that the management of people had a greater effect on a business’s performance than the combined effect of its strategy, product or service quality, manufacturing technology and expend- iture on R&D. These results demonstrate the importance of the relationship between employee attitudes and company performance and as such indicate that the more satisfied workers are with their jobs, the better the company is likely to perform in terms of profitability and particularly productivity.

However, the study’s most important finding was the linkage between ‘good’ human resource management practices and productivity. The report concluded that overall, HRM practices (i.e. appraisals, training and develop- ment) and in particular, employee involvement through team working, etc., explain 18 per cent of differences in productivity between companies and within organisations. As the researchers state, this is the most convincing demonstration in the research literature of the ‘link between the management of people and the performance of companies’ (Patterson et al. 1997).

A follow-up study of 5000 employees in 42 UK manufacturing companies conducted by West and Patterson (1998, 2) reinforce thelink between employee satisfaction and productivity and profitability. In fact they indicate that aggregated job satisfaction within a company predicted up to 25 per cent of the variation between companies in performance and 12 per cent of profitability one year later. They argue that no other factor (such as competi- tive strategy, technology, market share, total quality management or R&D strategy) could so effectively predict company performance (West and Patterson 1998, 3).

Research in the UK by Forth and Millward (2004) found that HIM practices such as team-based task practices, with other supports reinforce employees’ willingness to contribute to broader organisational goals. In addition, by using research based on a nationally representative survey of British workplaces found that HIM workplaces paid an average premium of around 8 per cent over otherwise comparable employees in workplace adopting a more traditional approach (Forth and Millward 2004, 118). However, as part of supporting practices, job security guarantees were critical for such practices to lead to greater rewards. Forth and Millward (2004, 118) conclude that ‘the provision of job security also appears to increase the likelihood that a high- involvement approach will yield performance improvements’.

Research highlighting the link between HR practices and mortality rates in the UK National Health Service (NHS) also reinforces the potential outcomes of HIM practices (West 2002). In a study of 61 hospitals in England there was a strong link between the extent and sophistication of appraisal systems in hospitals and lower mortality rates. In addition, there were also

High involvement management and HR sustainability 23

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 23

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

links between the quality and sophistication of training and high levels of employee involvement by the number of staff trained to work in teams. This research suggests that these measures enhance productivity by improving the knowledge, skill, motivation and performance of employees. Importantly, HR policies such as selection and training are associated with improved job performance. It was argued that by changing and enhancing employee behaviour, a more co-operative and helpful approach to colleagues develops and makes better team workers (West 2002).

Interestingly, the research also revealed greater employee participation and involvement by the introduction of self-managing teams, which led to greater co-operation and better inter-departmental communication, with workers reporting that they felt involved in the decision-making process. As a consequence, workers stated that the increase in professional and emotional support gained as part of a team environment increased job satisfaction, producing lower sickness absence rates (West 2002). The research found that the employee involvement through team working lowered patient mortality. Importantly, these findings allowed for differences in size, regions and socio- economic status.

For example, an association was found between team working and deaths following emergency surgery, with 25 per cent more staff working in teams able to produce 275 fewer deaths per 100 000 admissions or 7.1 per cent of the total (West 2002). West concludes,

If you have HR practices that focus on effort and skill; develop people skill; encourage co-operation, collaboration, innovation and synergy in teams for most, if not all, employees, the whole system functions and performs better. Another striking finding from the research is that when HR directors are members of the board of the hospital, the association between HR practices and lower patient mortality are even stronger… The resource implications are considerable. The magnitude of returns for investments in HR practice can be substantial.

Importantly, these studies suggests that the personnel or HR function should move away from being seen as a peripheral administrative activity and be placed at the centre of the organisations activities (Richardson and Thompson 1999). Overall, the evidence suggests that management should equip employees to make decisions, through the provision of information and training, and share ownership in the outcomes of those decisions for the organ- isation. Research by West and Patterson (1998) into employee satisfaction and productivity indicates that encouraging know-how and locating information at the lowest levels of the organisation gives employees the expertise to manage their work, recognise problems and generate solutions. To reinforce these developments, organisations need to create a culture of information sharing, consultation and greater organisational knowledge.

24 Asia Pacific Journal of Human Resources 2005 43(1)

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 24

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

HIM has also been viewed in terms of human resource sustainability, defined as the capacity of organisations to create and regenerate value through the sustained application of participative policies and practices (Dunphy and Griffiths 1998; Gollan 2000 ). The people management and development policies and practices need to be integrated for sustained business performance and positive employee outcomes of equity, personal development and well- being.

Figure 1 represents the major factors, influences and outcomes of human resource sustainability in organisations. While not intending to be exhaustive, it identifies five major factors in the debate about human resource sustain- ability. Essentially, the model defines human resources sustainability in terms of the capacity of organisations to create value, thereby having the ability and

High involvement management and HR sustainability 25

High involvement management and human resource sustainability

Figure 1 Factors and influences in human resource sustainability

Source: Gollan (2000).

Human

resource

sustainability

Employee

consultation

and

involvement

Organisational

change

Career

development

and

organisational

learning

Work and life

balance

Workplace

institutions

and systems

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 25

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

capacity to regenerate value and renew wealth through the application of human resource policies and practices. This will entail investment in human knowledge through continuous learning, and the application and development of such knowledge through employee participation and involvement. In addition, the model identifies four main drivers for organisations trying to achieve corporate human resource sustainability and examines their impact on employee satisfaction and commitment and on the traditional organisational objectives of increased productivity and profits. Importantly, the model suggests that for human resource sustainability to be achieved, the HR policies and practices need to be integrated for business performance and positive employee outcomes of equity, development and well-being.

Overall, the sustainability of high performance work systems is predicated on organisations recognising the needs of employees and implementing sustainable policies and practices to reinforce its values and principles through greater employee involvement and participation. Only by acknowledging the importance of employee satisfaction and commitment through the develop- ment of integrated employee consultation, organisational change, work and life policies, workplace institutions and comprehensive career development programs, will the organisation achieve greater efficiency, and productivity.

Figure 2 presents an integrated model of the HIM process, emphasising the influence of organisational culture and the impact of the external envir-

26 Asia Pacific Journal of Human Resources 2005 43(1)

Figure 2 Human resources, capabilities and sustainability – a way forward

Source: adapted from Gollan and Davis (1998, 7).

Organisational

aims

• codes & standards • legislation & trade unions • competition & business cycle

• labour & product markets

External environment

Organisational culture

• leadership & management style

• employee involvement & participation

• customs & norms

Operational

practices

Outcomes

Human resource

sustainability

• work arrangements • technology utilization • customer/supplier relations • multi-skilling & job redesign • organisational structure • production processes (teamwork, TQM, JIT)

• training & appraisal

• productivity & profits • effectiveness & efficiency • employee commitment & lower employee turnover

• equity & perceived fairness skills development

• knowledge management • flexibility

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 26

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

onment based on human resources capabilities and sustainable organisational outcomes. It presents a model of organisations pursuing a human resource sustainable approach. It emphasises the influence of organisational culture and the impact of the external environment on sustaining outcomes. The model shows that improved performance and productivity are predicated on the need for managers to use situational attuned approaches to ensure that the potential of the organisation is contributing to desired organisational aims. Thus, there is no one best way for all organisations, only organic processes based on situa- tional characteristics which satisfy the aims and objectives for the organisation and its employees in a sustainable way.

The future capabilities in the organisation and, as a consequence, the improvement in performance are premised on the belief that it is necessary to develop a new workplace culture, which emphasises the role of employees as assets rather than merely as a costly factor of production. Importantly, human sustainability is based on organisations pursuing a strategy in which employee relations policies are embedded into all aspects of the organisation’s planning and implementation process (Gollan and Davis 1998). An organisation must ‘continuously [develop] the organisational capabilities to identify and integrate within its vision and strategy the conceptual shifts needed to respond to dynamic markets and the operational capability to deliver’ and enhance performance (Ford 1999, 3).

A recent critical assessment of the high performance literature and research by John Godard (2004) has raised a number of limitations on the effects of the high performance workplace and HIM agenda. He concludes that ‘compared to what has been thought of as good management practice, claims that these systems yield superior performance outcomes may be unwarranted, and their implications for both workers and unions are at best uncertain’ and instead advocates an alternative paradigm which promotes legal and institutional reforms (Godard 2004, 349). He argues:

that the promise of the high-performance paradigm appears to have been a false one, and hence that it is more a question of having state policies and laws that promote … ‘good’ work and employment practices, ensuring quality jobs, progressive employer practices and meaningful representation and voice, rather than promoting an absolute, optimum model that fails to account for the institutional conditions of the employment relation. (Godard 2004, 350)

Godard (2004) suggests that while there is little reason to doubt that such practices are potentially highly effective in some workplaces and the adoption

High involvement management and HR sustainability 27

The challenges and limitations

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 27

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

of at least some of these practices may increase performance, it is likely that proponents not only overestimate the positive effects but also underestimate the costs. As a result, full adoption of a HPWS approach may yield little or no advantage over traditional good personnel practices, and in some workplaces may result in more negative organisational outcomes. Regarding employee involvement and communication, Godard cites work by Barker (1993) into autonomous teams in the US manufacturing plant which concluded that workers as individuals felt pressured by strict performance norms, a circum- stance he referred to as ‘concertive’ control. Evidence would also seem to indicate that where HPWS are initially received positively by workers, such support decays over time as experience with such practices accumulates (Godard 2004, 356). In another study by Appelbaum et al. (2000) over 4000 workers in 44 US plants in steel, apparel, and medical electronics industries suggested that self-directed teams and off-line teams made very little difference and ‘where they did their effects were negative almost as often as they were positive’ (Godard 2004, 356).

Godard concludes that because the costs of an involvement approach can be high, it is necessary for employers to ensure high benefits if the program is to be a success. Even when employers do not follow a high intensification approach, it may in ‘many cases be necessary to create a high-pressure envir- onment if the performance gains needed to justify a high level of adoption are to be achieved’ (2004, 368). He goes on to say: ‘Workers may therefore be subjected to considerable pressures to work still harder, even if through norms enforced by peers rather than from direct employer pressures’ (2004, 368). Godard argues this may also provide a further explanation as to why full adoption of a HPWS approach is relatively rare and difficult to sustain. ‘That is, because of high levels of pressure, and hence stress, experienced by employees, the gains associated with high levels of adoption are even more difficult to sustain’ (2004, 368). Moreover, Godard (2004) advocates that greater regulation and state intervention in the labour market would address problems of distrust and conflict that arise out of the inherent conflictual nature of the employment relationship, and the associated cost of the full adoption of a HPWS approach. This would also provide a minimum benchmark that all organisations would have to adhere to, reducing the possibility of shirking or opting out by some firms to avoid the associated cost of implementing a comprehensive HIM and HPWS agenda.

A recent Australian survey of high performance work practices indicated the importance of the HR function in the successful adoption of HIM and HPWP practices (Murphy and Southey 2003, 75). This research suggests that the strategic HR practitioner as part of the HR function has the potential to be a

28 Asia Pacific Journal of Human Resources 2005 43(1)

The opportunities for the HR function

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 28

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

pro-active agent of change with the ability to develop, plan and implement a wide range of organisational activities linked to firm performance (Murphy and Southey 2003, 75). In particular, the research indicated that central to the success of the implementation of such practices were the important practitioner dimen- sions of networking skills, HR group climate and the role of the HR group, and organisational leadership (Murphy and Southey 2003, 85). Regarding networking skills, practitioners who recognise the need for and possess the ability to use a wide variety of networking skills are able to develop productive relations with key elements within organisations (Murphy and Southey 2003, 85). The researchers also suggested that HR practitioners who acknowledge the value of innovation-conducive climates are more likely to devote greater resources to creating and maintaining them and thus are more likely to be open to the adoption of new practices, to actively engage behaviours that successfully apply appropriate HPWPs (Murphy and Southey 2003, 86).

Murphy and Southey (2003) also highlighted the significance of organ- isational leadership. The evidence would suggest that while there continues to be difficulty for the HR function to assert their influence in organisational decision-making, the issue of legitimacy and justifying their role in the appli- cation process is critical to the success of HPWPs initiatives. The researchers cited three areas where organisational leaders can encourage new HR practice. Leaders can determine the role of the HR function, have a significant impact on ‘innovation friendly’ cultures, and provide a clear focus and direction for the development innovative activity (Murphy and Southey 2003, 86–7). Linked to this is the importance of the HR function being represented within the higher levels of the organisational hierarchy and the strategic role within the organisation and thus the degree of political power that the HR function then possesses. The researchers conclude that practitioners developing legitimacy within the organisation are more likely to be involved in the successful adoption of HPWPs (Murphy and Southey 2003, 86–7).

Dave Ulrich (1998) has suggested four ways which HR function can deliver organisational excellence. First, by forming the link between board- room decisions and the marketplace, the HR function can become a partner with senior and line managers in strategy implementation. Second, by providing relevant expertise in the way work is organised and executed, it can ensure administrative efficiency. Third, the HR function can represent employees’ concerns to management while simultaneously giving employees the capacity to increase their contribution to organisational decision-making. Fourth, the HR function should be an agent of change, shaping processes and culture that together improve and enhance an organisation’s capacity for change (Ulrich 1998, 124–5).

In particular, managers need to reassess the role and level of the HR function, specifically its role in persuading organisations to adopt practices that support a sustainable approach (Hunt 1999). This requires devolved decision- making emphasising medium to long-term sustainability rather than the short-

High involvement management and HR sustainability 29

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 29

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

term horizons characteristic of more traditional, centralised corporate HR or personnel management approaches. The advocates of corporate level human sustainability issues and practices need to be political movers and leaders putting forward a HR agenda to support sustainability. At lower levels HR advocates need to be co-ordinators, mentors and integrators, linking and inte- grating human capabilities into organisational structures, technologies and practices of organisations (Hunt 1999). As John Hunt (1999, 21) has suggested:

The key to the success of the function lies in the struggle to acquire more influence, something that is being carried out in a climate of downsizing and outsourcing. Even the change of name from personnel to HR is indicative that the way people view and perform this role is changing – with the new name communicating a desire to break with the past and to throw off an image that was limp and limiting... The future of the HR function may be far from certain ... [however] ... In situations of uncertainty, it is the confident who win through ... I know of no organisation whose senior managers believe their company will operate, in the future, without any human beings. Whether ensuring the supply of those human beings resides in a function called HR or not is rather irrelevant.

The evidence presented suggests that the implementation of employee involve- ment and participation programs can be linked to improved organisational performance. Company performance will usually benefit from the integration of human resource management and product and market strategies, improved understanding of the needs of employees at the workplace, and better use of their skill and ingenuity. Strategies designed to achieve a more comprehensive use of employees’ human potential, desire to learn, flexibility and personal responsibility would appear capable of delivering higher levels of performance (Gollan and Davis 1998).

This is at the heart of the argument for more attention to HIM. Other things being equal, it will improve the organisation’s profitability by changing employees’ attitudes, overcoming resistance to change and increasing commit- ment (Gollan and Davis 1998). Moreover, there will be the experience of mutual advantage. Management will benefit from improved performance and, for instance, reduced levels of turnover and absenteeism. Employees will enjoy more secure employment, upgraded tasks, a large degree of workplace autonomy and incentives to take responsibility for a quality product. Evidence from West and Patterson (1998) seems to reinforce these points.

So if HIM approaches are positive and worthwhile, why do more firms not embrace this more readily? Three main issues can be highlighted from the

30 Asia Pacific Journal of Human Resources 2005 43(1)

Conclusion

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 30

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

research. First, it can sometimes be difficult to prove the link between good employee involvement and consultation practices and organisational perform- ance. Second, the time period can be an important dimension, with employee consultation normally requiring short-term costs for achieving long-term rewards. Third, perhaps the most difficult obstacle is that effective employee consultation requires a change in culture for managers and employees, which may involve considerable leadership skills, vision, time and resources.

In summary, there is evidence that there is a great deal of employee involvement and participation taking place in Australian workplaces (Morehead et al. 1997). However, other findings highlight that the amount of employee participation might well be exaggerated and the quality of many schemes may be limited (Campling and Gollan 1999). Too little attention has been paid in practice to the implementation of integrated HIM approaches. The evidence also suggests that the sustainability of high performance work systems is predicated on organisations recognising the needs of employees and implementing sustainable policies and practices to reinforce its values and prin- ciples through greater employee involvement and participation. Only by acknowledging the importance of employee satisfaction and commitment through the development of integrated employee consultation, organisational change, work and life policies, workplace institutions and comprehensive career development programs, will the organisation achieve greater efficiency, and productivity. Overall, what can be drawn from the research is that high- quality communication and consultation between management and employees at the workplace is essential in achieving HIM and improved organisational performance and sustainable outcomes for organisations and employees.

Paul J. Gollan (MBA (Nottingham), MSc (LSE)) is a Lecturer in the Department of Industrial Relations at

the London School of Economics. He has lectured at a number of universities and colleges throughout

Australia and the United Kingdom.

Paul has authored, co-authored and co-edited a number of books in the fields of human resources

and industrial relations. His current research interests cover employee participation and involvement,

high performance work systems, high involvement management, non-union employee representation,

and corporate and human resource sustainability.

References

Appelbaum, E., T. Bailey, P. Berg, and A. Kalleberg. 2000. Manufacturing advantage: Why high-performance work systems pay off. Ithaca, NY: Cornell University Press.

Australian Centre for Industrial Relations Research and Training (ACIRRT). 1999. Australia at work: Just managing? Sydney: Prentice Hall.

Barker, J.R. 1993. Tightening the iron cage: Concertive control in self-managing teams. Administrative Science Quarterly 38(3): 408–37.

Becker B.E. and Huselid M.A. 1998. High performance work systems and firm performance:

High involvement management and HR sustainability 31

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 31

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

A synthesis of resource and management implications. In Research in personnel and human resources management, ed. G.R. Ferris, vol. 16, 53–101. Stamford, CT: JAI Press Inc.

Campling, J. and P. Gollan. 1999. Bargained out: Negotiating without unions in Australia. Sydney: Federation Press.

Cully M. 1998. The state we’re in. People Management 4(21): 68–72 Dunphy, D. and A. Griffiths. 1998. The sustainable corporation: Organisational renewal in

Australia. Sydney: Allen & Unwin. Dunphy, D., A. Griffiths and S. Benn. 2003. Organisational change for corporate sustainability,

London: Routledge. EPOC Research Group. 1997. New forms of work organisation: Can Europe realise its potential?

Dublin: European Foundation for the Improvement of Living and Working Conditions.

Fenton-O’Creevey, M., S. Wood, and E. Callerot. 1998. Employee involvement within European multinationals. European Works Council Study Group, Stage 1 Research report, July.

Fernie, S. and D. Metcalf. 1995. Participation, contingent pay, representation and workplace performance: evidence from Great Britain. British Journal of Industrial Relations 33(3): 379–415.

Flood, P., M. Gannon, and J. Paauwe. 1995. Human resource strategies for world-class competitive capability. Managing without traditional methods. Cambridge: Addison- Wesley.

Ford, J. 1999. The learning enterprise: Market driven organisational transformation in lead enterprises in Sweden. Unpublished working paper. Bronte, NSW.

Freeman, R.B. 2001. Upping the stakes. People Management 7(3) (8 Feb.): 24–9. Geary, J. and K. Sisson. 1994. Conceptualising direct participation in organisational change –

The EPOC Project. Dublin: European Foundation for the Improvement of Living and Working Conditions.

Godard, J. 2004. A critical assessment of the high-performance paradigm. British Journal of Industrial Relations 42(2) (June): 249–378.

Gollan, P., ed. 1995. Globalisation and its impact on the world of work. ACIRRT Working Paper no. 38. Sydney: University of Sydney.

Gollan, P. 2000. Human resources, capabilities and sustainability. In Sustainability – The corporate challenge of the 21st century, eds D. Dunphy, J. Benveniste, A. Griffiths, and P. Sutton, 55–77. Sydney: Allen & Unwin.

Gollan, P. and E. Davis. 1998. High involvement management and organisational change: Beyond rhetoric. Unpublished paper. Sydney: Labour-Management Foundation, Macquarie Graduate School of Management.

Gollan, P. and E. Davis. 1999. High involvement management and organisational change: Beyond rhetoric. Asia Pacific Journal of Human Resources 37(3): 69–91.

Gollan, P.J. and R. Markey. 2001. Conclusions: Models of diversity and interaction. In Models of employee participation in a changing global environment: Diversity and interaction, eds R. Markey, P.J. Gollan, A. Chouraqui, A. Hodgkinson, and V. Veersma, 322–43. Aldershot: Ashgate.

Guest, D. and R. Peccei. 1998. The partnership company: Benchmarks for the future. London: Involvement and Participation Association.

Hunt, J.W. 1999. Working in a rich human vein. Financial Times 10 February: 21. Kessler, I., R. Jennings, and R. Undy. 2000. A comparative study of employee communication and

consultation in private sector companies: final report. Oxford: Templeton College, University of Oxford.

Knell, J. 1999. Partnership at work. DTI Employment Relations Research Series no. 7. London: Department of Trade and Industry.

32 Asia Pacific Journal of Human Resources 2005 43(1)

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 32

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/

Kochan, T. and P. Osterman. 1994. The mutual gains enterprise: Forging a winning partnership among labor, management, and government. Boston, MA: Harvard Business School Press.

Lawler, E.E. 1992. The ultimate advantage: Creating the high-involvement organization. San Francisco: Jossey Bass.

Lawler, E.E., S.A. Mohrman, and G.E. Ledford, Jr. 1995. Creating high performance organizations. San Francisco: Jossey-Bass.

Levine, D. 1995. Reinventing the workplace: How business and employers can both win. Washington, DC: Brookings Institution.

Millward, N., A. Bryson, and J. Forth. 2000. All change at work? London: Routledge. Morehead, A., M. Steele, M. Alexander, K. Stephen, and L. Duffin. 1997. Change at work:

The 1995 Australian Workplace Industrial Relations Survey. Melbourne: Longman. Murphy, G.D. and G. Southey. 2003. High performance work practices: Perceived

determinants of adoption and the role of the HR practitioner. Personnel Review 32(1): 73–92.

Osterman, P. 1994. How common is workplace transformation and who adopts it? Industrial and Labour Relations Review 47(2): 173–88.

Patterson, M., M. West, R. Lawthom, and S. Nickell. 1997. Impact of people management practices on business performance. Issues in People Management. London: Institute of Personnel and Development.

Richardson, R and M. Thompson. 1999. The impact of people management practices on business performance: A literature review. Issues in People Management. London: Institute of Personnel and Development.

Terry, M. 1999. Systems of collective representation in non-union firms in the UK. Industrial Relations Journal 30(1):16–30.

Ulrich, D. 1998. A new mandate for human resources. Harvard Business Review 76(1) (Jan.–Feb.): 124–34.

Walton, R.E. 1985. From control to commitment in the workplace. Harvard Business Review 64(2) (March–April): 77–84.

West, M. 2002. A matter of life and death. People Management Online, http://www.people management.co.uk/archiveitem.asp?id=6285.

West, M. and M. Patterson. 1998. People power: The link between job satisfaction and productivity. CentrePiece 3(3) (Autumn): 2–5.

Wood, S. 1996. High commitment management and payment systems. Journal of Management Studies 33(1): 53–78.

Wood, S. 1998. Human resource management. LSE Research Seminar, 3 November, London. Wood, S. and M. Albanese. 1995. Can we speak of high commitment management on the

shop floor? Journal of Management Studies 36(2): 215–47. Wood, S. and L. De Menezes. 1998. High commitment in the UK: evidence from the

Workplace Industrial Relations Survey, and Employees’ Manpower and Skills Practices Survey. Human Relations 512(4): 485–515.

High involvement management and HR sustainability 33

APJHR_43_1_Gollan.qxd 31/01/2005 3:32 PM Page 33

at Victoria University on February 13, 2012apj.sagepub.comDownloaded from

http://apj.sagepub.com/