HUMAN RESOURCES
STRATEGY IN OPERATIONS MANAGEMENT
MRS.
S. L. ADEYEMI (PhD) AND L. BADMUS (PhD).
DEPARTMENT OF BUSINESS ADMINISTRATION,
Abstract:
The paper describes human resources strategies in operations management
especially where the nature
Introduction
The conduct of most activities
undertaken by a firm especially those relevant to production, require the
availability of capable and skilled personnel. Human resources represent the
most valuable input to the production process and deserve the special attention
of all levels of management because of their unique role in the total system.
Human performance is crucial to an
organization’s performance. An organization does not function without people;
it does not function well without competent, motivated people. How the
operations manager formulates a human resource strategy determines the talents
available for operations. Human resources are expensive. Dowling’s study (1973)
showed that in many organizations, a third of total cost is in wages and
salaries and within the operations function, these costs range from 8% to 80%.
Because of the importance of personnel and their cost, early consideration of
human strategy options is necessary.
In most organizations, the human
resources function is responsible for resolving three basic problems related to
human resources.
a). Recruitment of a
sufficient number of people with adequate qualifications for the variety of job
descriptions to be filled.
b). Effective utilization of existing
personnel
c). Holding and improving existing personnel
through tangible and intangible rewards
The proper planning of the internal
working environment and the utilization of human resources must satisfy workers
in the same way as the design of products and services must the needs of
potential customers.
In the past it was assumed that
employee satisfaction was mainly related to wages or salaries and other
financial incentives. In contemporary business. It is widely understood that to
attract and maintain an effective work force requires the satisfaction of a
wide range of human needs relating to working conditions, proper motivation and
opportunity for self advancement.
Drucker (1974) argues convincingly
that in the design and operation of productive systems we must consider the
work to be performed and the working. The first relates to the tasks needed to
create a product or service and can be treated objectively, impersonally, and
in a logical fashion. The second aspect, working, relates directly to the
people performing the tasks and by its very nature is highly subjective and
personal, defying rational analysis. Effective systems are not possible only
with the logical analysis of the tasks to be performed i.e. the work, but most
clearly satisfy the needs of those working. Working is described in terms of
the following dimensions:
a.
The physiological dimension,
which differentiate people from machines
b.
The psychological dimension,
which covers the many and often conflicting attitudes for, and needs from,
work.
c.
The social dimension, which
explains the need for bonds through work with others and the community at large
d.
The economic dimension, which
covers the need to earn a living with one’s wages from work
e.
The power dimension, which
explains one’s relationships to others in a work group and the ability to
decide how rewards and punishments will be distributed
Thus, the proper utilization of
human resources requires working conditions, structuring of jobs and
development of plans that contribute not only to the achievement of the
organization’s objectives but to the satisfaction of needs of those employed in
it.
Objectives
of the Human Resources Strategy
The objective of a human resource
strategy is to manage labour and design jobs to human resources:
a.
Are efficiently utilized within
the constraints of other strategic operations m management decisions;
b.
Have a reasonable quality of
work life in an atmosphere of mutual commitment and trust.
By reasonable quality of work of
life, we mean a job that not only is reasonable safe and for which the pay is
equitable, but also that achieves an appropriate level of both physical and
psychological requirements. By mutual commitment, we mean reasonable,
documented employment policies that are honestly and equitably implemented to
the satisfaction of both management and employees. When management has genuine
respect for its employees and their contribution to the firm, establishing a
reasonable quality of work life and mutual trust is not particularly difficult.
Human
Resources Strategy Constraints
Many decisions that are made about
human resources are constrained by other strategic decisions. First, the
product mix may determine seasonality and stability of employment. Second,
technology, equipment and processes, may have implications for safety and job
content. Third, the location decision may have an impact on the ambient
environment in which the employees work. Finally, decisions requiring layout
may dictate, in large part, job content.
The trade-offs between the
technology available combined with location and layout decisions and the proper
capital investment decisions and quality of work life are pretty difficult.
Of all the strategy decisions, the
human resources strategy is as a result of the other operative design
decisions.
Dimensions of the Human Resources Strategy
Acknowledging the constraints
imposed on human resources strategy, we need to look at three distinct decision
areas of human resources strategy and they are:
1.
Labour Planning: Labour planning in
determining staffing policies that deal with (i) employment stability and (ii)
work schedules
2.
Job Design: Job design is specifying the
tasks that constitute a job for an individual or a group. A job consists of a
variety of tasks; a task consists of a number of elements; and an element
consists of micro-motions. Job design will be examined from the perspective of
four components:
i Job specialization and environment
ii. Psychological components
iii.
Ergonomics and work methods and
iv.
Motivation and incentive system
3.
Labour Standard: Labour standards help
us specify the labour required for given levels of production once jobs have
been defined.
We establish labour
standards via:
i.
Historical data
ii.
Work sampling
iii.
Method time measurement and;
iv.
Stopwatch standards
The paper focuses on the first two
dimensions of human resource strategy with less attention paid to motivation
and incentive system.
Labour Planning
Employment Stability Policies
The labour planning strategies
consist of the following:
1. Chase
Demand Exactly. Following demands exactly has the advantage of keeping
direct labour costs tied closely to production but incurs other costs. Here the
firm maintains fluctuating work force following demand. According to Dervitsiotion
(1981) the extra costs that would be incurred include:
a. hiring and termination costs
b. Unemployment insurance costs and
c. Perhaps, a labour wage premium to entice
personnel to accept unstable employment. Such a policy tends to treat labour as
a variable cost.
2. Hold
Employment Constant. Holding employment constant has the advantage of maintaining
a trained work force and keeping the hiring termination and unemployment costs
to the barest minimum. The demerit is that employees may not be utilized fully
when the demand is low, and the firm finds meeting demand difficult when demand
is high. Such a policy tends to treat labour as a fixed cost.
Maintaining a stable work
force may yield a wage rate lower than that paid by firms that do not. This may
provide a competitive advantage. However, managers who choose a strategy
resulting in fluctuating work force may also be choosing the most efficient
option available to them. Such a firm may have highly seasonal work and few
options for managing demand. Conceivably, however, the firm can find complementary
labour demand in other products or operations such as meeting the cans and
latels or repairing and maintaining facilities for a firm producing salmon
canner.
Firms must make a
decision as to employment stability. The above strategies and others can be
effective and efficient and provide a reasonable quality of work life.
Work Schedules
Although the standard work schedule
in Nigeria 1:30 p.m. rather than 11:30 a. m. is not much help either.
Some industries find that their
process strategy has severely constrained their human resources scheduling,
option. Fir instance, proper manufacturing, petroleum refining, and power
stations must be staffed around the clock except for maintenance and repair
shutdown. Firms in these industries are severely constrained when implementing
variable-time policies.
Another work schedule is a flextime
workweek. This often manifests itself in, four 10-hour days. This works in many
operations functions, provided suppliers and customers can be accommodated.
Firms that have high process star-up times (say to get a boiler up to operating
temperature or a plastic molding machine running properly) find longer workdays
options particularly appealing.
Another option is to have shorter
days rather than those longer days. This often moves employees to part-time
status. Such an option is particularly attractive in service industries, where
staffing for peal levels is necessary. Banks and restaurants are frequent
practitioners of this technique. Additionally, many firms are able to achieve
labour costs by reducing fringe benefits for part-time employees.
Job Classifications and Work Rules
Who can do what, when they can do it
and under what conditions are determined by job classifications and work rules.
Part of an operations manage4r task is to manage the unexpected. The work
flexibility a firm has when staffing and establishing work schedules, the more
efficient it can, Building morale and meeting staffing requirement is easier if
managers have fewer job classifications and work rule constraints.
Job Design
Andrew and Mare (1980), contend that
“The effective utilization
of a person as a productive component requires the careful design of jobs in
every phase of the production process. Such a design effort consists of
specifying for each job the actual work, in terms of related tasks to be
performed and responsibility for planning and control of these tasks. To
accomplish this, management must determine existing constraints and appropriate
criteria for performance.
In production and operations, job
design follows the planning and designing of product, process and equipment.
Job design specifies the content of each job and determines the distribution of
work within the organization.
Although the two basic approaches to
job design were developed separately, they are not mutually exclusive. The
first, the micro approach scientifically examines each details of the job so
that wasted effort is eliminated and output rate is enhanced. The second, more
recent, approach to job design is behavioral. In it, physiological and
socio-psychological considerations encourage job enlargements and job conditions;
it too can result in improved output.
According to Kayewski and Ritzman
(1993), job design specifies job content, the employee skills and training
needed to perform that job, and the degree of specialization appropriate for
the job. Job design is an important part of a firm’s operation strategy because
it defines the amount of flexibility needed in the work force. They contend
that successful job design:
a.
Improves efficiency through
analysis of the job’s work elements;
b.
Improves productivity through
consideration of technical and human factors
c.
Increases the quality of the
firm’s products or services and
d.
Increases worker satisfaction
Hiexer and Render (1993) credited
job design’s importance as a management variable to Adam Smith. Smith (1876)
suggested that a division of labour also known as specialization would assist
in reducing labour costs in several ways:
1.
Development of dexterity and
faster learning by the employees because of repetition
2.
Less loss of time because the
employee would not to be changing jobs or tasks
3.
Development of specialized
tasks and the reduction of investment because each employee has only a few
tasks needed for a particular task.
Traditional Engineering Dimensions of Job Design
Taylor’s methods dealt with the
engineering aspects of design’s ways to best reach, grasp and move ,object, the
number of repetition to be performed before
a rest was needed; and the best physical position for the worker.
Many Managers have applied Taylor
Often managers responsible for many
subordinates and equipment feel overwhelmed by details. Couldn’t we be more
efficient if we improved our jobs? But how can we improve that when we hardly
know what the job? One answer to the managers’ dilemma is offered by the
scientific management approach. It urges managers to:
1. Identify the general operations problems area
and the jobs that seem to be contributing to or causing the problem
2. Carefully analyze and document how the work
is currently being performed (Established industrial engineering techniques are
available to assist in analysis and documentation,)
3. Analyze the content of individual jobs and
job elements
4. Develop and implement new work methods
Often jobs can be broken, separated
into elements. If the elements are assigned to different workers, each worker
can perform fewer elements, but he can perform them faster and perhaps under
more specialized conditions (with special tools or work benches; for example).
This basic concept, specialization of labour, has been very effective in
increasing ioperating efficiency in manufacturing; but it has been less
effective in the service industries (Heizer and Remder, 1993).
Everet and Ronald (1986) suggest
that to assist the manager or staff analyst to study a job in which a problem
has been identified, certain techniques can be. One of these techniques is the
operations chart which is used to analyze the job into elementary motions of
the right and left hands – reaching, carrying, lifting, pushing and releasing, for
example.
In some instances, a time scale is
placed in the middle of the operation chart so that it is clear how much time
each takes to perform the associated motion. Operation charts are appropriate
for routine, repetitive, short cycle task performed on how to moderate
production volumes.
Activity charts divide operations
into the major task segment performed by the machine arid separate them by a
vertical time scale. In this way, the analyst can easily complete the
percentages of productive and idle time and concentrate on method of reducing
idle time for the worker and/or machine.
Flow process charts analyze
interstation activities, attempts to portray the flow to the overall productive
process. To capture this flow, process into one of five standard categories
operations; transportation; storage; inspection, or delay. Flow process charts
are appropriate for visualizing the
sequential; stages of conversion process. They help reveal unnecessary product
movement or duplication of effort whose elimination would improve efficiency.
Flow process charts provide a broader level of analysis that the preceding
methods, many job are examined, but none in depth.
These three traditional techniques,
operations charts, activity charts and flow process charts, facilitate interjob
analysis (at the individual job station) and interjob (between job stations). After
systematically studying existing job content, engineers and technicians can
often find means of improving ,jobs that have been ,looked by foremen and
managers. To realize idle time, they inlay recommend eliminating unnecessary
elements or modifying the sequence of elements.
Job Specialization
A job with a high degree of
repetition; greater efficiency and high quality. Consider the tasks required in
a fast-food restaurant where the employees take the order, prepare and package
the meal and accept payment. This job design becomes inefficient as the volume
of orders increases because the employees start bumping into each other.
Alternately, the tasks could be divided into two jobs; one an order taker who
also keeps the French-fryer going, draw drinks, packages the meal and accepts
the payment; the other a burger maker who does all the grill work.
Specialization results in benefits such as:
·
Less training time needed per
employee because the methods and procedure are limited
·
Faster work pace, leading to
more output in less time; and
·
Lower wage paid because
education and skill requirements are lower
However, the arguments against job
specialization suggest that narrowly defined jobs lead to:
·
Poor employee morale, high
turnover, and lower quality because of the monotony and boredom of repetitive
works
·
The need for more management
attention because the total activity is broken down into a large number of jobs
and a large number of employees, all of whom have to be coordinated to produce
the entire product or service and
·
Less flexibility to handle
changes or employees absence
The degree of specialization should
relate directly to the competitive priorities of the firm. A high degree of specialization
tends to support the competitive priorities of a product-focused firm; low
costs, consumer quality and little variety. A low degree of specialization
tends to support the competitive priorities of a process-focused firm;
customization, high performance design and flexibility. However, some firms
that compete on the basis of low costs and consistent quality such as Motorola.
AT & T etc. are exploring organizational models based on less
specialization.
Behavioral Dimension of job Design
In the past, industrialized
societies have used economic criteria as their primary guides in designing job.
Traditional job design emphasizes specialization, task repetition and reduction
of skill requirements to minimize the impact of the individual worker on the
production process. Jobs have been designed to minimize immediate costs and
maximize immediate productivity, it is agreed that economic criteria are still
paramount. However, we must not forget, that behavioral implications in job
design can and do influence performance. To ignore these concepts is to bypass
the opportunity to add further economic benefits to those we obtain through
traditional approach.
i). Job Rotation: Where considerable
aspects of a job cannot be eliminated either by redesigning or automating it,
job rotation, provides an excellent way to approach such a job.
Job rotation is a system whereby
workers exchange jobs periodically, thus getting more diversity in task
assignment. This approach is most effective when the jobs require an equal
level of skills. Because workers learn many aspects of the job, job rotation
increases the skills of the work force, giving management the flexibility to
replace absent workers or to move workers’ workstations as necessary. In
addition, rotating jobs can give each worker a better appreciation for the
production problems of others and the value of passing only good quality to the
next person.
Just as employees can move in and
out of a shift that is undesirable they can be rotated in and out of jobs that
are undesirable. Even there is no change in job content; rotating employees among
different jobs can reduce boredom and monotony by exposing the employee to a
broader perspective of the entire production process.
2). Job Enlargement: The horizontal
expansion of a job that is increasing the range of tasks at the same level is
called job enlargement. The employee competes a large proportion of the total
work required for the product or service. Typically, this approach requires
that workers have various skills and training programmes and wage increase
often accompany it. Besides reducing boredom, job enlargement has the potential
to increase employee satisfaction because the worker feels a greater sense of
responsibility, pride and accomplishment.
We can think in terms of jobs being
composed of tasks each of which is performed by a worker. With each task is
associated a set of stimuli, auditing, visual and /or tactile. As the worker
performs the tasks, he receives various stimuli, cues. The number and kinds of
stimuli depend on the nature of the tasks. A job consisting of many varied tasks
provides varied stimuli; a job with routine, repetitive tasks usually provides
few stimuli.
Proponents of job enlargement argue
that we have simplified and routinized jobs to the point where they are so
specialized that workers perceive them to be monotonous: workers are bored and
dissatisfied. Michael (1975) contends that as a result of boredom and
dissatisfaction, many workers may disengage from the organizations that are
characterized with high level of tardiness, absenteeism and turnover. If managers
would enlarge job by adding tasks, additional stimuli would reduce the
ill-effects of too simplified, too specialized jobs. Figure 1 illustrates the
assumptions behind job enlargement.
Source: Everet, E and Roonald, J. E. (1986), Production and
Operations Management: Concepts, Modes and Behaviour, 3rd ed. P 327
The conceptualization of an enlarged
job offers the employees four opportunities:
1. Variety, the opportunity to use a variety of
skills
2. Autonomy, the opportunity to exercise control
(over how and when the work is completed;
3. Task identity, the opportunity to be
responsible for an entire piece or a programme of work and
4. Feedback, the opportunity to receive on-line
information
Thus, job enlargement is the
procedure of redesigning job or modifying work so that employees can feel more
involved in and responsible for what they do.
The nature and content of a job may
be changed through enlargement in two ways. First, more tasks of a similar
nature and skill level can be added. If as job consists of tightening one bolt
for example, it could be redesigned to consist of tightening four different
nuts on different bolts. The job would then be enlarged horizontally. Second,
other tasks of a different nature but similar skill level may be added. Instead
of tightening one nut on one bolt, the worker could assemble two pieces of
metal and a piece of plastic, tighten a nut and bolt to hold the assembly
together, and walk to a storage area to get more nuts and bolts. The job would
then be enlarged vertically. Job rotation, mentioned earlier, is a variation of
job enlargement, where the job per se is not enlarged, but rather the employee
is allowed to move from one specialized job to another.
3). Job Enrichment: The most comprehensive
approach to job design, is job enrichment, which entails a verticals expansion
of job duties. That is, workers have greater control and responsibility for an
entire process, not just a specific skill or operation. This approach supports
the development of employee empowerment and self-managed team, whereby
employees make basic decisions about their jobs.
Job enrichment presumes that many
jobs are so highly specializes that operative workers can no longer visualize
how their works contribute to the organization goals. The worker tightening a
nut on a bolt all day long loses sight of the fact that because that nut helps
hold a wheel on a new car, the safety of family might well depend on how
diligently he does his job.
Job enrichment not only provides
satisfaction, however, it cam also make the organization more efficiency. Many
managers feel that goals of job enrichment and increased efficiency are not
only compatible, they are comforting and necessary partners. They argue that it
is impossible to sustain productivity without the conscious satisfactions that
the job environment helps create.
The conditions needed to be
established for effective job environment include:
i.
Management must supply
information on goals and performance that previously was not available to the
workers
ii.
A proper organizational climate
does not imply excessive of individual behavior in the organization
These two conditions can be met by
recreating traditional management theory:
1.
Every employee must be viewed
as a manager. Each must get involved in the management activities of planning,
organizing and controlling his own job. This is the basic goal of job
enrichment
2.
The organization should strive
to make work like play, to make the job fun. If a worker’s job can be designed
so that it offers the rewards that game does- visible and meaningful goals,
immediate feedback, group cohesiveness and people are there because they want
to be their workers would enjoy them
Limitations to ob
Enlargement and Job Enrichment
In spite of enormous benefit
associated with job enlargement and enrichment in the workplace, they have a
lot of limitations. These limitations include:
a.
Higher capital cost
Job enlargement and enrichment
require facilities that cost more than conventional layout. This extra
expenditure must be generated through savings (greater efficiency or through
higher prices).
b.
Many Individuals Prefer Simple
Jobs
Some studies indicate
that employees, majority in some cases, opt for the less complex jobs. In a
discussion about improving the quality of work life, it seems appropriate that
we must not forget the importance of individual differences. These differences
provide latitude for the resourceful operations manager when designing jobs.
c.
Higher Wage Rates are required
People often receive
wages for their highest skills, not their lowest, so enlarged and enriched jobs
may well require average wage than jobs that are not.
d.
Smaller Labour Pool Exists
Because enlarged and
enriched jobs require more skill and acceptance of more responsibility, the job
requirements have increased. Depending upon the availability of labour, this
may be a constraint.
e.
Increased Accident Rates May
Occur
Enlarged and enriched
jobs may contribute a higher accident rate. This indirectly increases wages,
insurance costs and workmen compensation.
f.
Current technology may not lend
itself to job enlargement and enrichment
These six points provide the
constraints on job enlargement and job enrichment. The practices increase
costs. Therefore, for the firm to have competitive advantages, its savings must
be greater than its costs. It is not always obvious that such is the case.
There is no guarantee that productivity or quality will improve with the
situation of job enrichment or job enlargement. The strategic decision is not
an easy one.
Psychological Components of Job Design
Effective human resources strategies
also require consideration of the psychological components of job.
Psychological components of job design focus on how to improve the quality of
work life, job satisfaction, and motivation by designing job that meet some
minimum psychological requirements. Some of these psychological parameters of
good job design can be identified as follows:
i.
Hawthrone Studies: The publication of
the Hawthrone finding in 1939 demonstrated conclusive that there is a dynamic
social system at the workplace. Ironically, these studies were initiated to
determine the impact of lighting on productivity. Instead they found the social
system and distinct role played by employees to be more important than the
intensity of the lighting. They also found that individual differences may be
dominant in what an employee expects from the job and what the employee thinks
his contribution to the job should be. The Hawthrone studies introduced p
psychology to the workplace.
ii.
Maslow’s Hierarchy of Needs: Maslow’s
need theory (fig. 2) suggests that well-designed jobs should allow employees to
address physiological and psychological needs. Furthe4r, Maslow’s need theory
suggests that once employees have satisfied lower-level needs, they seek to
satisfy those needs at the next higher level. Ideally then, job should contain
ingredients that allow people to satisfy needs at all levels. Job design has
the potential of providing both satisfaction and motivation as the employee
seeks to satisfy higher level needs.
iii.
Herzberg’s Two-Factor Theory (or Motivation/Hygiene Factors): Frederick Herzberg’s, in his dual-factor theory, suggests that job can
contain hygiene elements (there are dissatisfactions if not fulfilled) and
motivation (there cam motivate people about their job.) the dual-factor theory
is shown in fig. 3
If we make assumption
that virtually any job in the Western world can and should provide for Maslow’s
lower needs and Herxberg’s higher level and elements, then good job design will
also include Maslow’s higher level and Herzberg’s motivators. Engelstead (1979)
these psychological components of job design when he offers the following six
guidelines:
1.
The need for the content of a
job to be reasonably demanding for the individual in terms other than sheer
endurance and yet provide some variety (not necessarily novelty)
2.
The need for an opportunity to
learn on the job and to go on learning
3.
The need for some minimal area
of decision making that the individual can call his own
4.
The need for some minimal
degree of social support and recognitioin at the workplace
5.
The need to be able to relate
what individuals do and when thsy produce to their social life
6.
The need to feel that the job
leads to some sort of desirable future
The idea is to use the psychological
components of job design not only to improve the quality of work life and job
satisfaction but also to motivate employees. Employees should be as committed
as management to meeting organizational objectives. World-class firms build
environment that motivate employees to contribute, and motivation often,
include employee involvement. Employee involvement includes participation fostered
by supervisory action, teams, committees, and job design.
Figure 3 Herzberg’s Two-Factor
|
Job Satisfiers
|
1. Challenging
work
|
Self-actualization
|
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|
2. Achievements
|
Ego
|
|
|
3. Growth in
the job
|
|
|
|
4. Responsibility
|
|
|
|
5. Advancement
|
|
|
|
6. Recognition
|
|
|
Job Dissatisfies
|
1.
interpersonal relations
|
Social
|
|
|
2. Quality of
supervision
|
Safety
|
|
|
3. Company
policies and Admin;
|
Physiological
|
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|
4. Working
conditions
|
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5. job Security
|
|
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6. Salary
|
|
Ergonomics and Work Methods
Taylor and his contemporaries
examined the role of management and employees in the workplace and were
concerned with:
1.
Matching employees to the task
(individual differences)
2.
Work methods (improving task
performance)
3.
Work standards (so both employees
and employer would know what was to be done and what constituted a fixed day’s
work)
With the foundation provided by
Taylor and his contemporaries, we have developed a body of knowledge about
people’s capabilities and limitations.
The operations manager is interested
in building a good interface between human and machine. Studies of this
interface are known as ergonomics in America
Edwin (1976) contends that because
male and female adults come in limited configuration, the design of the
workplace must depend on biomechanics and anthropometrics data. Biochemist and
anthropometrics data provide the basic strength and measurement data needed to
design tools and workplace.
The Work Environment
The physical environment in which
employees work affects their performance. Safety and quality of work life
illumination, noise and vibration, temperature, humidity and quality are work
environment factors under the control of the organization and the operations
manager. Tile manager must approach them as controllable.
Illumination is necessary, but the
proper level depends upon the work being performed. However, other factors
include reflective ability, content of the work surface with surroundings,
glare and shadows.
Noise of some form is usually
present in work area, and many employees seem to adjust well. However, high
levels of sound will impair hearing. Therefore, most managers make substantial
effort to reduce noise and vibration through good machine design.
Temperature and humidity parameters
have been well established. Managers with activities outside the established
comfort zone should expect some adverse effective on performance.
Motivation and Incentive
The Maslow’s need structure and Herzberg’s
dual factor theory provide insights into the psychological factors that may
contribute to job satisfaction and motivation. In addition to these
psychological factors, there are monetary factors. Money often serves as a
psychological as well as financial motivator. Monetary rewards take the form of
bonuses, gain sharing and incentive systems.
Bonuses, typically in cash or stock
options, are often used at executive levels to reward management. Gain sharing
technique rewards employees for improvement made in an organization’s
performance. The most popular of these is the Scanlon plan, where any reduction
in the cost of labour is shared between management and labour. These systems
are often based on the employee or crew achieving production above a predetermined
standard. The standard can be based on a standard time per task or number of
pieces made, standard time systems are sometimes called measured day-work,
where employees are paid based on the amount of standard time accomplished. A
piece rare system assigns a standard time for each piece, and the employee is
paid based on the number of pieces made. Both systems typically guarantee the
employee at least a base rate for the shift.
Labour Standards
Labour plans require knowledge of
the human resource required. Therefore, labour standards are established.
Labour standard are the amount of time required to perform a job or part of a
job. Every firm has labour standards, although they may vary from those
established via informal methods to those established by professionals. Only
when accurate labour standards exist can management know what its labour
requirements are, what its costs should be and what constitutes a fair day’s
work.
Conclusion
How well a firm manages its
resources strategy ultimately determines its success. The production/operations
management activity has a large role to play in achieving human resources
objectives. The first objective is to achieve efficient use of human resources
within the operations function; this is often a major goal of a firm because
operations is usually the function with the highest labour cost, and labour is
often the large part of the total cost of the product. The second objective is
the design of jobs that are effective, safe and provide a reasonable quality of
work life for the employee in an atmosphere of mutual respect.
Further, the fundamental function in
production and operations management is organizing work. This required the
manager to design jobs, establish job standards, and perform work measurement.
In practice, methods analysis (job design) is followed by work measurement
(establishing the job standard through measurement).
The traditional engineering
approaches to job design have emphasized the use of operational charts,
activity charts, flow process charts and principles of motion economy.
Considerations must also be given to worker psychology and environmental
conditions as these affect job design. Such behavioral concepts as job
rotation, enlargement and enrichment and redesign of job characteristics can
enhance productivity and satisfaction. If managers use both traditional
modeling and contemporary behavioral concepts in designing jobs, the result may
be more effective and efficient.
References
Andrew, S. S, Jr; & Marc, W. J.
(1980), Organization Behavior and Performance, 3rd ed. Santa Monica
Califonia Goodyear Publ. Co.
Dervitsiotis, K. N. (1981),
Operations Management, McGraw-Hill, 3rd Boston
Dowling, W. P. (1973), “Job Design
in the Assembly-Line: Forward to the collars Blues”’ Organizational Dynamics,
Spring pp51-67
Dowling, W. F. & Gilberson
(1973), “Volvo Increases. Productivity Through Job Enrichment”’ California
Management Review, pp64-68
Everett, E. & Ronald, J. E.
(1986), Production and Operations Management: Concepts, Models and Behavior;
Prentice-Hall International, 3rd New Jersey
Edwin, R. T. (1976), “Biomechanics
Sustain Occupational Safety and Health, Industrial Engineering . Feb.; pp46-53
Englestead, W. A. (1979),
Productions and Operations Management, McGraw-Hill ,
New York
Fredrick, H. Mausner, B. &
Snydeman, B. B. (1965), The Motivation to Work, New York
Heizer, J. & Render, B. (1993),
Production and Operations Management, Allyn & Bacon, 3rd Boston
Krajewski, L. J. and Ritzman,
(1977), Production and Operations Management, McGraw-Hill , New York
Michael, F. (1975), “Job Enrichment
Does Not Work”’ Atlanta Economic Review, Nov-Dec; pp50-59
Maslow, A. W.
(1941) “A Theory of Human Motivation”’ Psychological Review, 50 pp 370-396
Myers, M.S.
(1970), Every Employee a Manager, New
York
Taylor, F. W. (1911), Scientific Management, New York
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