CHAPTER 6:

DESIGN & REDESIGN

OF
WORK SYSTEMS

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 Exhibit 6
6--1
Model for Design of Work Systems

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 Design of Work Systems

• Job Specialization
– Creates jobs with very narrow task (activity) assignments
– Resulted in high efficiency, quickly achieved job competency, low
training costs, but created monotonous jobs
• Job Enlargement
– An increase in task variety to relieve boredom
• Job Rotation
– Employees moved across different specialized positions
– Enlargement and rotation add variety, but not necessarily responsibility

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 Design of Work Systems

• Job Enrichment
– Increasing amount of responsibility for quality and productivity
that employees have for their own work
• Vertical Loading
– Reassignment of job responsibility formerly delegated to
supervisor to the employee

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 Five Core Job Characteristics
• Skill variety
–Extent to which work allows
employee to use variety of skills
• Task identity
–Extent to which work allows
employee to complete whole or
identifiable piece of work
• Task significance
–Extent to which employee
perceives that work is important
and meaningful to those inside or
outside organization
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• Autonomy
–Extent to which employee is able
to work and determine work
procedure at own discretion
• Feedback
–Extent to which work allows
employee to gain sense of how
well job responsibilities are met
1–5
 Exhibit 6
6--2
Job Characteristics Model

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 What Workers Need

• Changing demographics • Employee needs

& life styles representation (“voice”)
– Worker needs vary by age, – Workers want to be involved
gender, race, religion, in work
work--related issues, and
physical abilities, sexual expect organization to listen
orientation, and marital and to concerns
family status • Employee concerns about
• Employee needs for safety in workplace
work/life balance – Workers want safe, hazard
hazard--
– Workers less committed to free working environment
organizations today
– Also suffer from burnout and
lower performance

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 Types of Task Interdependence

• Pooled interdependence • Reciprocal

– Individual employees work interdependence
independently of each other in – Workflow is random
performing tasks but utilize – Responds to immediate
coordination of activities situation
• Sequential – Employees have joint and
interdependence shared responsibilities for
work
– Work in process flow is linear,
from one individual to another • Higher levels of
– One individual depends on interdependence require
timely completion of quality higher levels of
work from another coworker coordination and attention

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 Redesign of Work Systems

• Current and future work systems more broadly

defined, and more closely related to strategic
choices
• Workers becoming more involved in design and
reengineering of jobs
• Cross
Cross--function teams strategically beneficial
– Also create challenges in effectively managing themselves
• Employees raised in individualistic cultures need
training to be effective team members

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 Outsourcing

• Involves contracting out some of organization’s

noncore work activities to outside specialists
– Can do work more effectively
– Often for less than cost of doing work in-
in-house
• Areas frequently outsourced:
– Payroll
– Benefits
– Technological support
• More than 75% of organizations outsource at least
one HR function

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 Outsourcing

• Can free up HR staff to focus on more

strategic issues
• Considerations:
– Cost savings
– Whether contractor can deliver
– Compliance with laws
– Impacts on employees whose jobs might be lost
– Impacts on morale of remaining employees

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 Offshoring

• Involves exporting tasks and jobs to countries

where labor costs are significantly less than in the
U.S.
• India remains largest market
• Wages approximately 10% of those paid in U.S.
– Often considered good by local standards
• Challenge of managing virtual global teams
• Need for tight organizational and operational
control to ensure coordination and communication

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 Offshoring

• Advantages • Disadvantages
– Cost savings – Loss of domestic
– Extend work day to jobs
24 hours – Transfer of technical
knowledge
– Public image/loyalty
concerns

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 Mergers and Acquisitions

• Mergers pursued for a variety of reasons:

– Economies of scale in operations
– Consolidation in saturated markets
– Improving competitive position through larger asset
base
• Two thirds of mergers fail
– Largely because of inability to merge cultural and
other human factors

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 Barriers to Change

• Disrupting status quo may be met with resistance

by both employees and managers
• Costs and reallocation of resources
• Employees will resist change unless they
– Perceive need to change
– See benefits from change
• Risk and uncertainty; no guarantee of
improvements
• Poor coordination and communication can
undermine change initiatives
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 To Overcome Resistance to Change

• Promote and implement change so it provides

benefits to those impacted
• Involve employees in change process to increase
their commitment to change
• Open, two-
two-way communication
– Early, before change decisions are made
– Dispel rumors
– Increase trust and acceptance of change by keeping
employees informed and asking for input

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 Reading 6.1 (Nahavandi & Aranda)
Restructuring Teams for Re-
Re-engineered Organizations

• Reasons for using teams in organizations:

– Unlikely one individual will have all of the knowledge
and information needed to make complex decisions
– Teams provide more “buy “buy--in” to decisions
– Managers believe teams enhance motivation and
productivity
– Facilitate acquisition and sharing of information vital
to organizational growth and flexibility
– Facilitate variety of internal quality control initiatives

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 Reading 6.1
Restructuring Teams for Re-
Re-engineered Organizations

• Problems with teams

– May fail without proper training and support
– Often poorly integrated into organization’s hierarchy
– Individuals often feel their team contributions dilute
personal success
– Few teams have found effective means to deal with
“freeloaders”
– Usually not represented at top levels of organizations,
sending a mixed message about their importance

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 Reading 6.1
Restructuring Teams for Re-
Re-engineered Organizations

• Three keys to successful teams

– Value and endorse dissent
– Encourage fluidity of membership
– Enable teams to make decisions

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 Figure 1
Three Key Elements for Success of US Teams

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 Figure 2
Team Development Model

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 Supplement to Reading 6.1 (Werner & Lester, 2001)
Research on Student Case Teams

What predicts the performance of student teams?

Satisfaction Grade
– Team structure positive strong positive
– Team spirit strong positive strong positive
– Social support strong positive negative
– Workload sharing positive not significant
– Communication not significant not significant

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 Reading 6.2 (Greer et al.)
HRM Outsourcing: Make or Buy Decision

• Five competitive forces driving

organizations to outsource HR activities:
– Downsizing
– Rapid growth or decline
– Globalization
– Increased competition
– Restructuring

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 Reading 6.2
HRM Outsourcing: Make or Buy Decision

• Operational rationales for outsourcing

– Small firms lack resources; large firms gain
economies of scale
– Specialized HR expertise and objectivity
• Reduced liability and risk in legally sensitive HR
areas
– Innovations and economies of scale in HRIS
technology used by outside vendors
• Simplify transactions
• Reduce HR costs
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 Reading 6.2
HRM Outsourcing: Make or Buy Decision
• Operational rationales for outsourcing
(continued):
– Time
Time--sensitive issues better handled by outsourcing
– Temporary or cyclical increases in HR needs
– Efficient vendor management practices drive costs
down more than economies of scale
– Specialized vendors offer activities as their core
business and strategic focus

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 Reading 6.2
HRM Outsourcing: Make or Buy Decision
• Strategic rationales for outsourcing:
– Outsourcing nonstrategic activities permits HR to
move away from administration toward strategic role
– Decentralization of HR function through
redeployment of some of assets to operating units
– Develop less bureaucratic HR departments
– Downsizing may require HR to reduce staff,
eliminating specialized in
in--house expertise
– Outsourcing provides “big picture” perspective

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 Reading 6.2
HRM Outsourcing: Make or Buy Decision
• Positive outcomes
– Lower HR costs
– Higher service quality
– Realignment or redeployment of internal HR
expertise
– Development of negotiation and broker skills
– Enhanced credibility of HR function
– Risk and uncertainty absorption by HR vendor

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 Reading 6.2
HRM Outsourcing: Make or Buy Decision

• Negative outcomes
– Significant cost savings not always
experienced
– Vendor switching costs
– Long
Long--term vendor contracts
– Disruption of firm’s culture
– Removal or distancing of HR function from
employees
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 Reading 6.3 (Evangelista & Burke)
Productivity in Downsizing
• Many downsizing firms face immediate
challenge of keeping operations going with
minimal staff
• Productivity often declines
• Survivors
– Working more hours
– Receive with bigger workload
• Morale often plummets

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 Reading 6.3
Work Redesign

• Typical problems
– Failure or inability to identify and categorize
duties and assignments
– Failure to identify when employee is over-
over-
tasked
– Failure to see when business unit’s demands
exceed its capacity

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 Reading 6.3
Work Redesign: Task Categories
• Critical tasks • Minor tasks
– Enable company to – Add value to firm, but
accomplish primary will not hinder
objectives operations or goals if
• Sub-
Sub-critical tasks left undone
– Need to be • Unnecessary tasks
performed, but – Can be discarded
average standard of because they drain
quality will suffice resources

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 Reading 6.3
Work Redesign
• Output from work categorization process
must be shared with all employees, so they
have list of tasks for which they are
accountable
• These tasks are used to drive performance
management process

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