Assignment

Of
Organisation change
And development
On
Employee involvement

Submitted to : Submitted by:

Mrs. Manbir Dhaliwal Indu rana
(assistant professor) Roll no.20518
Diksha
Roll no.20501
m.com 2 nd
Meaning of employee involvement:
It refers to work structures and processes that allow employees to
systematically give their input into decisions that affect their own work.
The direct participation of staff to help an organisation fulfil its mission and
meet its objectives by applying their own ideas, expertise, and efforts towards
solving problems and making decisions.
Regular participation of employee in deciding how work is done, making
suggestion for improvement , goal setting, planning and monitoring of their
performance.

Features of Employee Involvement:

1. Employee involvement means emotional and mental involvement and not

only the physical involvement.

2. Employee involvement is done through the representatives of the

employees.

3. Employee involvement can be formal and informal.

4. Collective bargaining and employee involvement is different.

5. Employee involvement is done at the different levels of management.

Objectives of Employee Involvement:

1. To Make Worker’s Role Important – The basic objective of employee’s

involvement is to make employees’ role important in an organisation. For
successfully attaining the objectives and goals of the organisation, it is essential
to make employees’ involved in the achievement of goal because without
them it is not possible to achieve the goals.

2. To Increase Productivity – When employees are involved in the decision

making with the management, this motivates them and their morale increases.
This leads to increase in their efficiency which brings increase in the level of
productivity.
3. To Satisfy the Needs of the Employees – Every employee wants to be
recognized for his capabilities, so participation in management makes them
feel recognized and they will be motivated to perform hard work. And
moreover, employees social and esteem needs will also be satisfied.

4. To Develop Human Personality – The employees’ involvement in

management gives them opportunity to express themselves. They express
their views freely at various levels and their hidden talent comes out. Thus
they get an opportunity to develop their personality.

5. To Strengthen the Employee Management Cooperation – Coordination and

cooperation between the employees and management improves the
relationship between them. Employees don’t feel neglected and when they
participate in decision making they feel recognized. And their relations with
their superiors also improve.

Elements of employee involvement:

1. Free Flow of Communication – For making the employee involvement in

management a success, there should be a free flow of information. Because
through communication employees can express their views freely and don’t
hesitate. This two way communication is necessary for both employees and
management.

2. Impartial of Both Employers and Employees – Both employers and

employees should express their ideas and views. There should be no personal
benefit for both. The employee involvement in management scheme cannot
be successful unless the employer and employee should have positive attitude
towards each other.

3. Implementation of Decision – For making the employees involvement in

management a success there is a need to implement the decisions which are
suggested by the employees. By this employees will be motivated and also
suggest good ideas in future. The delay in implementation of the decisions can
adversely affect the morale.
4. Idea from within – When involved with the management in the decision
making, the employees should give the ideas, which come straight from their
heart. They should not have to fulfil any legal formality while giving their views.
So they should suggest what they feel.
Employee involvement-3 major types:

The major types of employee involvement are as follows:

I. Participative Management

II. Representative Participation

III. Quality Circle

Type # I. Participative Management:

This is defined as the process in which subordinates share a significant degree

of decision-making power with their immediate superiors. It is the type of
management in which employees at all levels are encouraged to contribute
ideas towards identifying and setting organizational- goals, problem solving,
and other decisions that may directly affect them. It is also called as
consultative management. It enhances employee morale and productivity.

Four processes influence involvement , which are as follows:

a. Information sharing- It is concerned with keeping employees informed

about the economic status of the company.

b. Training- It involves raising the skill levels of employees and offering

development opportunities that allow them to apply new skills to make
effective decisions regarding the organization as a whole.

c. Employee decision making- It can take many forms, from determining work
schedules to deciding on budgets or processes.

d. Rewards- It is tied to suggestions and ideas as well as performance.

Pros and Cons of Participative Management:

Pros:

1. It enhances employee morale and productivity by creating a sense of

ownership among them.
2. Managers using participative style find their employees more receptive to
change.

3. Participation helps employees gaining a wider view of organization.

4. Employees become more creative and innovative.

Cons:

1. Employees get less time to finish their daily work or achieve their daily
standard.

2. Sometimes the management is less willing to turn over some of the

decision-making responsibility to subordinates.

3. The larger the organization, the more difficult it becomes to institute a

participative management style.

Type # II. Representative Participation:

This is defined as a process of employee involvement in organizational decision

making through a small group. It is the most widely legislated form of
employee involvement around the world. The objective of representative
involvement is to redistribute power within an organization, keeping labour on
a more equal footing with the interest of management and stakeholders.

The two most important forms of representative participation are:

1. Works Councils

2. Board Representatives

1. Woks councils are groups of nominated or selected employees who must be

consulted when management takes decisions involving personnel. It is also
defined as a “shop-floor” organization representing workers, which functions
as local/firm-level complement to national labour negotiations. Very often
being dominated by management it has little impact on employees of the
organization.

2. Board representatives are employees who sit on a company’s board of

directors and represent the interests of the firm’s employees.
Type # III. Quality Circles:

Quality is conformance to the claims made. Quality circle is a volunteer group

composed of workers who meet together to discuss workplace improvement,
and make presentations to management with their ideas. Typical topics are
improving safety, product design, and manufacturing process. Quality circles
have the advantage of continuity; the circle remains intact from project to
project.

Pros and Cons of Quality Circle:

Pros:

1. The use of quality circle has been one of the central aspects in the evolution
of total quality management, a much broader intervention strategy.

2. It meets the psychological needs of the workers (self-expression,

involvement, recognition, etc.).

Cons:

1. It suffers from various structural problems.

2. Sometimes the concept has not been well understood by managers,

supervisors and workers.

Importance of employee involvement:

1. Increased Commitment – When employees are consulted for taking

important decisions and also to formulate policies. They express their views
and ideas. The employees feel that they are important to the organisation and
their commitment also increases.

2. Organisational Peace – Organisational conflicts occur between the

employees and the management and they become opponent of each other.
But employee involvement brings the cooperation between them and they
come closer to each other.

3. Growth and Development of Employees – When employees are allowed to

express their views freely, this makes them creative. They also design new
methods for performing the work. Therefore, involvement of employees in
management leads to their growth and development.

4. Increase in Mutual Understanding – In the present scenario the employees

and the employers both think each other as their rivals. But involvement of
employees bring both the parties on the common platform, they come close to
each other and understand each other’s problem. This increases their mutual
understanding.

5. Acceptance of Change – Whenever change is introduced, employees are

first to resist the change and when the employees are the part of the decision,
which introduces the change, they will accept it easily. So in this way resistance
to change is reduced through employee involvement in decision making.

6. Increased Production – The employees’ involvement will increase the

morale and the efficiency of the employees, which will lead to the increase in
the production. Further, the organisational peace will also lead to increase in
the contribution made by each employee.

7. Way of Self Expression – The employee involvement in management

provides an opportunity to the employees to express themselves. They explain
their views, difficulties, problems, suggestions, freely and without any fear.
This makes them to do their work without any pressure.

8. Motivation and Job Satisfaction – The importance given to the employees

by consulting them on various decisions will motivate them and provide them
job satisfaction. Goals are set up with the consent of employees and they feel
motivated to achieve them on time. The improved performance of the
employees will give them job satisfaction.

9. Solidarity among Employees – It will help in creating solidarity among the

employees. They will become an organized force. Since employees will be
required to send their representatives for participating in various bodies they
will come on the common platform. The employees will come together under
the common banner for increasing their bargaining power. So employees’
involvement will bring solidarity among them.
Methods of employee involvement:
Method # 1. Work Councils:

Work council consists of equal representatives from both the parties i.e.
employees and the employers. They meet regularly for discussing the different
problems. Both the parties present their suggestions and decisions are taken
jointly. And these jointly taken decisions are binding on both of them. The
matters which are normally discussed are education, accidents, safety, welfare
facilities etc.

Method # 2. Collective Bargaining:

An individual employee does not have the full knowledge about the
appropriate pay rates for his services. So he joins the employee union and the
representatives of employee union equally participate with the management,
discuss the aspects and fix the pay rates for the employees. Negotiations in this
way are done on equal basis. So this process is known as collective bargaining.

Method # 3. Co-Ownership:

In this method employees are provided with the ownership rights. Employees
are encourages to purchase the shares, they will get the voting right to elect
their directors and will be able to send their representations in the board of
directors and can influence decision making process.

Method # 4. Representation in the Board of Directors:

In this method the representative from the employee is taken in the Board of
Directors. He is also named as employee director. But this method is not very
much effective because he would be in minority and his suggestion will have
little weight. This may bring inferiority complex in him and he may be
completely suppressed or frustrated.

Method # 5. Joint Consultation:

In this method the joint committee represented by the employees and the
management is set up to discuss and give suggestion for improvement with
regard to matters of mutual interest. The decision of such committee will be
binding on both the parties.
Method # 6. Discussions:

In this system managers call the meeting of the employees and share the
information with them. He explains the problem to the employees, gives
information to them and invites suggestions. The employees give their opinion
to their problem and decision making authority is not transferred to them.

Method # 7. Suggestions System:

Under this system the employees are encouraged to make suggestions for the
improvement. The employees may suggest some new methods of production
or new schemes for the particular work. The employee who provides
innovative suggestions are provided with monetary and other rewards.

Conclusion :
One of the greatest underlying factors in the success or failure of any
organisation is the power of its people and how well that power is
focused towards meeting the organisation objectives.