The Role of Authority: Employee participation in decision-making

For nearly a half century, a central theme in social psychological and sociological research on organizations and in the work of consultants on

participation increases both employee satisfaction and productivity. The evidence from the numerous empirical studies that have been carried out is mixed. In general, participation does increase employee satisfaction, but it does not appear to have a consistent effect upon productivity.27

Interest in the subject has been reawakened by the use of quality circles in Japan, and their presumptive role as one of the elements in the rapid growth of Japanese productivity. To work our way around the sometimes conflicting empirical evidence, let us start at the other end and ask what theory would predict. The issues are both motivational and cognitive. On the motivational side, we might postulate that participation increases satisfaction; which increases employee identification with the organization’s goals, including productivity goals; which leads to increased effort, care in work, and desire to solve problems; which increases production. On the cognitive side, we might postulate that workers have certain kinds of information about the work that is not as directly available to their supervisors or to management, and that employees’ participation in decision-making leads them to contribute this information to diagnosing and solving quality problems (and other kinds of problems as well).28

If these are the important underlying mechanisms then at least two crucial conditions must be satisfied in order for participation to increase production: (1) the basic attitude of the employees to the organization must be sufficiently positive that the opportunity to participate is welcomed and leads to an increase in identification with organization goals; (2) the employees must, through observation or otherwise, have access to information about the manufacturing process that is important to maintaining product quality. It is easy to see that these conditions might be satisfied in some factory situations and not in others. It can also be seen that success with participative activities will depend on how they are conducted, and requires focusing on what employees are in a position to contribute. There is no reason to suppose that employees will be willing or able to increase productivity unless these conditions are met.

The theory just outlined is quite different from the proposition that employees who have the opportunity to participate in decision-making will “work harder.” The idea of the quality circles was not to induce employees to work harder, but to enable them to apply knowledge and intelligence toward improving the manufacturing process, including their part in it. Application of the principles of quality control, which emphasizes preventing defective work by tightening the manufacturing process rather than screening out defective products, can, in situations where standards are at all hard to meet, lead to very great increases in productivity. If 80 per cent of the products are defective (not unusual, for example, in the early days of computer chip manufacture), then reducing defects to 20 per cent increases productivity by a factor of four.

Returning to the general topic of participation, we see that it is something quite different from “democratization” of the workplace or the general withering away of the hierarchy of formal organizational authority. There is little evidence that many employees wish to participate in decisions that are not directly related to their own work experience and knowledge, except for decisions that bear directly on wages and other employment issues and thereby affect achievement of their personal goals. These latter issues, of course, raise questions of union representation of workers and of employee representation on company boards of directors. These are important questions, but they fall outside the scope of this book.

Source: Simon Herbert A. (1997), Administrative Behavior, Free Press; Subsequent edition.

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