Workers with Hearts:

Human Relations & TQM

Dr. Joe O’Mahoney 2007

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Learning Objectives

• To briefly revisit Human Relations

• To know the history and features of TQM

• To understand the methods by which TQM enhances managerial control.

• To examine the limits of control using TQM and Human Relations schemes

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AGENDA

1. The Failure of Taylorism?

2. Human Relations

3. TQM (neo-Human Relations?)

4. Critiquing TQM

- Rhetoric or Reality?

- Enhancing Control?

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The Failure of Rationality?

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Late 18th century art

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Early 20th century art

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The Failings of Science?

• The Great Depression

• The First World War

• The Holocaust

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Human Relations

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The discovery of the heart?

• The growth of ‘welfare’

• Growth in worker militancy

• Freud & the subconscious

• Anomie, alienation & angst

• WWI Personality testing

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Human Relations

• Hawthorne (Mayo), McGregor (Theory X & Y), Maslow (HoN)

• Psychology, sociology and Organisational Behaviour

• Practices:

- Team work

- Autonomous working

- Decision making

- Coaching

- Innovation / creativity

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Total Quality Management

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Japan v USA: a story of quality

1950

1985

2000

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Western Weaknesses

• Quality

• Costs of poor quality?o Loss of custom

o Product Repair

o Inspection

o Rework

o Complaints Management

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Supplier Inspection

Incoming Inspection

Fabrication Inspection

Sub-product Test

Final Product Test

Field Service

0.003

0.03

0.30

$3

$30

$300

Cost of finding and correcting a defective component

The Cost of Low Quality

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So what was Japan doing right?

• Innovation: In 1986 from a labor force of 60,000 Toyota received 2.6 million improvement proposals. 96% were implemented

• Error Free: 3.6 defective parts per million

• Efficient work layout & minimal waste

• Low inventory, no buffer stock

Yes, but HOW was it doing it?

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• “Continuous Improvement”- training

• Who are the experts?- empowerment

• Internal customers- Teamwork

Kaizen: Continuous Improvement

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• Team members volunteering (personal recognition)

• Different departments: engineering, marketing, HRM…

• Brainstorm Problems

• Potential Solutions

• Prioritized Solutions

• Implementation Plan

• 50% participation in Japan

• Illegal (in Japan) unless voluntary

Quality Circles

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Errors are inspected out Quality is built in

Workers are Drones Workers Are Experts

Managers tell Managers Support

Machines are sprinters Machines are marathon runners

Quality costs Quality is free

Specialisation Multi-skills

Hierarchy Flat Organisations

Traditional v TQM Philosophy

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Spread of TQM• 1980s

o Adoption of Japanese techniques

o Crosby: Quality is Free

o Peters and Waterman: In Search of Excellence

• 1990s & 2000so Expansion to non-manufacturing companies

o IEEE & Six Sigma

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Example: Xerox

• Japanese had entered the US market and were selling cheaper copiers

• Xerox lost its market share, down from 90% to 15%

• Mr. David Kearns became CEO of Xerox in 1982

• He adopted TQM– No inventory– No Inspectors– Managers as support

• It took 7 years for Xerox to get back its market share

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However….

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International Comparison

Suggestions per employee p.a.

Percentage accepted

Av. value of reward

% from operators

Japan 47 70% $35 84%

Rest of World

1 54% $178 55%

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Surveys of TQM Implementation

• Rhetoric not reality – WIRS 5% (Cully et al, 1998)

• Work intensification & enhanced controls

• Companies deemed ‘excellent’ later failed

• Evidence of resistance (e.g. Hawthorne)– Output restriction (Homans, 1959)– Acting-out– Informal resistance– Cross-cultural barriers

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TQM….empowerment or exploitation?

• Garrahan, P. and Stewart, P. (1992) The Nissan Enigma: Flexibility at Work in a Local Economy, London: Mansell

• Teamwork = surveillance & peer pressure

• Flexibility = exploitation

and intensification

• Quality = rhetoric & hype

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Weaknesses

• Not a miracle cure: 66% dissatisfied with TQM (Korukonda, A.P., Watson, J.G., and Rajkumar, T.M., ``Beyond Teams and Empowerment: A Counterpoint to Two Common Precepts in TQM''. S.A.M. Advanced Management Journal. Vol. 64 No. 1 (1999)).

• Takes a long time: 1 – 2 years to change mindset

• Things get worse before they get better (Estes, P. ``Northwood Research Raises Disturbing Questions about Employee Empowerment in Florida Businesses''. Northwood University Employee Empowerment Study, Fall (1997). http://www.seflin.org)

• Requires good labour relations (Boone, L.E. and Kurtz, D. Contemporary Marketing. Texas: The Dryden Press, 1998)

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Old wine, new bottle?

• Concerned with control

• Focus on intensification

• Scant evidence of real implementation

• Fits with modern rhetoric– Flexibility– Innovation– Creativity

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Thank you

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Reading• Peters, Tom and Waterman, Robert (1982) In search of excellence: lessons from

America’s best run companies. Crosby, Philip

• Crosby, P. (1979) Quality is Free. London: McGraw Hill.

• Willmott, H. (1995) Making quality critical

• Knights, David, and Darren McCabe (1998) ‘Dreams and designs on strategy: a critical analysis of TQM and management control’, Work, Employment and Society 12/3: 443-456.

• Knights, David, and Darren McCabe (1999) ‘Are there no limits to authority?: TQM and organisational power’, Organisational Studies, 20/2: 197-224.

• Rees, C. (1998) ‘Empowerment through quality management: employee accounts from inside a bank, a hotel and two factories’, in Experiencing Human Resource Management. C. Maybe, D. Skinner and T. Clark (eds.). Sage: London: 98-124

• Sewell, G., & Wilkinson, B. (1992). “Someone to watch over me’: Surveillance, discipline and the Just-in-Time labour process”, Sociology, 26(2), 271-289.

• Tuckman A (1994) “The Yellow Brick Road: Total Quality Management and the Restructuring of Organizational Culture”, Organization Studies, 15(5), pp727-751.

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