Summarise the employee commitment issues in the Optical Fibres Case and develop proposals to deal with the three problems emerging in the case. Overview of Employee Commitment Issues Employee commitment issues are those related to the psychological contract between the organisation and the employees. The psychological contract is ‘an unwritten agreement between individuals and the organisation of which they are members. ‘ (Schein, 1970) The overriding issue is the different perceptions the employer and employee have of the same events, actions or behaviour.
There is an evident dichotomy between the perception Optical Fibres (OF) wishes its employees to have, and tries to generate, as part of its side of the psychological contract and the reality of its employees perceptions, I will illustrate this later. This is in part due to a failure of OF to update in a meaningful way its HRM policies and practices to deal with the evolved labour market, its business and the expectations of employees. What they did at the outset & what they are not doing now?
The Optical Fibre business opened in North Wales in the late 1970’s, the site developed was a Greenfield site so the joint venture injected much needed income and employment into the area. By bringing employment, new skills and a new industry to a depressed area, the expectation is that the company bought and generated a lot of beneficial kudos regarding the ‘psychological contract. ‘ This continued with the adoption of a progressive training policy, based on US principles. The US project leader worked with two local managers who ‘cascade trained’ (Hendry, 2004) the rest of the business.
However the, ‘comprehensive training and updating tended to lapse (however) and become rather ad hoc,’ even though this training had contributed to the success of the business. The businesses success had been attributed to the quality of the product, the close technical co-operation with customers and dependable technical support. If the contributions these attributes made to business success had been widely known and understood by employees, they will have helped to build a culture of pride and commitment.
The suggestion now is that the market has matured and (‘in just seven years’) the optical fibre product has become something of a commodity product. This change affects worker perceptions of their product, consequently both their psyche’s and commitment are affected as they feel they are ‘making continued contributions’ but their endeavours are resulting in less differentiated and highly regarded output. The empowerment of staff through close technical co-operation with customers, helped to generate self-belief, and worker ownership/involvement.
The business has grown to around 300-350 people, this throws out a number of issues. Originally there were 140 workers who, were with the business from day 1 and are likely to feel that they ‘contributed to great success. ‘ At a headcount of 140 people it is possible to know, at least by sight, co-workers; this socialisation is important, particularly in menial/repetitive roles and as the business has grown this may have changed leading to isolation.
Additionally the key motivating personalities, at the businesses outset, may have less day-to-day contact with staff as both staff numbers and their roles have grown; this dilution of direct contact with ‘managers’ can contribute in making, at least these older workers, feel less valued. The OF factory was newly built on a Greenfield site in the late 1970’s; likely influence from the US partners would have resulted in a modern ‘state-of-the-art’ factory, with advanced working conditions. However 20, or so, years on this factory may be tired; the working environment has an effect of making workers feel valued, motivated and committed.
The technology is heavily automated so that, rather than a production-lines’ repetitive tasks, the roles at the lower end for employees focus on monitoring equipment. The perception of these monitoring roles, coupled with pay premiums in the late 1970’s may have meant that machine ‘operators’ saw their status as not merely production line workers. Perhaps the growth of the business, the widespread identification & publication of the key roles and lack of training has had an effect on morale.
For the first five years, during the height of union power pre-Thatcherism, there were ‘less than a dozen union members,’ the implication is that there are now more union members, which is indicative of the failures of the Advisory Board. The contract workers are not represented at any point in the ‘consultative system. ‘ The contract workers make up 24 out of 168 manufacturing employees, and 5 in computer, so perhaps as much as 10% of the workforce is not represented. This is a potential issue; disenfranchised employees may represent their own views in impromptu forums throughout the business planting a seed of dissatisfaction.