Quản trị kinh doanh - Chapter 15: The employment relationship

Chapter 15: The Employment Relationship4/8/2013Chapter 15: The Employment RelationshipEmployment as an Economic TransactionPerfect CompetitionImperfect CompetitionComplex ContractingSorting and Investments in Human CapitalJob DesignPay for PerformanceSummary Communication Between Management and WorkersCommunication from Management to WorkersCommunication from Workers to ManagementEmployee Power and Earnings ProfileThe Optimal Level of Worker ConsultationImproving CooperationFrom the Prisoner’s Dilemma to EmploymentReputation and the Employment RelationshipInvesting in ReputationHistory ConsistencyFirst ImpressionsEconomies of ScaleLeadershipCorporate Culture and Centralized Human Resource PoliciesSummary4/8/2013A Jigsaw PuzzleStart w/ strategy, & knowledge needed to implement leads to cascade of related org. design policiespolicies should not just match strategy, but also complement each otherexample from above:“Give stronger incentives ifsorting for talent is more importanteffort is more costly to employeeseffort has greater impact on firm valuethe employee has valuable specific knowledgeintrinsic motivation is relatively low or distorts behaviorthe evaluation is more effectiveless risky, distorted, or manipulablewell balanced across multiple taskssubjective evaluations are trusted more”4/8/2013Start with StrategyProduct + strategy + environment drive the key knowledge you need to create & usejob design & decision making follow from thatthis is why one buzzword does not work for all firmsKey questions“Who / what / where / when / why?”emphasize ex ante optimization, continuous improvement, or both?complexity, instability & unpredictability push toward continuous approachdo managers tend to be biased toward centralization?4/8/2013Employment as an Economic TransactionMost transactions occur in imperfect markets, owing toThin supply or demandImperfect informationLegislative or other imposed requirementsNumerous tools and techniques were introduced for dealing with imperfect markets (Ch 1 – 4)4/8/2013How to Think(About Organizational Design)Concluding Remarks4/8/2013Goals (of Organizational Design)Sorting / matchingInvestmentCreation & use of knowledgeMotivationAdaptation / evolution4/8/2013Ideas (for Rigor)Incomplete / asymmetric informationscreening, signaling, adverse selectionInvestmentgeneral & firm-specific human capitalreputationlearning (ex ante optimization & continuous improvement)Bargaining / contractinghold up problemsspot, long term, & implicit contractingDecision makingspecific knowledge of time & place; need for coordinationspecialization v. job enrichmentcreativity v. controlAgency theoryperformance evaluation (quantitative & subjective)shape of pay-performance relationship4/8/2013How to Think (derived from the Ideas)Firms can be thought of as “mini economies”use of knowledge + coordinationincentives for good decision makingcentral optimization or decentralized adaptation?An organization’s role is largely a developer & processor of knowledgehuman capital & intellectual propertyspecialized & general skillsspecific knowledge of time & place; integrationknowledge managementWhat’s good for employees is usually good for the firmprove & invest in themselveshave intellectual challenge in their jobsdevelop new ideas & implement themearn rewards for their contributions4/8/2013Then Move to Internal OrganizationDecision making processesModularize from the overall business down to the jobAddress coordination problemsDevelop knowledge management systemsInternal labor marketsrecruiting; training; development & patterns of job movesintellectual propertyMotivationintrinsic from job designperformance evaluation & incentives4/8/2013A Different View: Managing Your CareerTalentspecialist or generalist?signaling & investing in your talentscontinually reinvesting in new knowledgeWorkgo for what is most intrinsically motivatinginnovation & creativity are what is most valued, in the long runfocus on developing skills & knowledge that are hard to replicatePaybuy the job?evaluation & link to rewards more important than level (in the long run)Management / Leadershippersonality & reputationhow to give & receive evaluations4/8/2013Chapter 15 – The Employment RelationshipAfter Today’s Lecture, you will be able to address the following questions:Why is it difficult to write a contract that encompasses all dimensions of the employment relationship?How is the market metaphor applied in practice?What is the personnelist’s possible role in designing the firm’s communications processes?What can be done to garner mutual gains on behalf of the employee and the firm? 4/8/2013Empowerment through CommunicationOpen Book management introduced as a current conceptCould be most appropriate in labor-management settingsOther contexts worker empowerment through communication includeRevelation of plans and preferencesOpenness about salary and benefitsInclusion in the creativity processN.B., two critical factorsFor effectiveness, trust is required over cyclesShould only be undertaken when firm gain is available4/8/2013Improving CooperationPrisoners Dilemma is an example of cooperation in which both sides could be made better offContrasted with zero-sum gamesKey to gains as with the prisoners dilemma is trustFirm reputation is affected byPast actionsPresent communicationsConsistency of bothSidebar about Baldrige AwardPersonalities of leadership and management permeate the organization *4/8/2013RECAP – Chapter 15The best employment relationships are a combination of formal agreement and implicit understandingsUtilization of markets within the firm requires careful reviewCommunication can be used to empower workers – but benefits to the firm must be clearly understoodThe prisoners dilemma is solved through trust and repeated interactionBottom lineOutcomes in the employment relationship that are assured by trust, can be made more efficient by economics; The converse is not true4/8/2013