Employee Satisfaction and Productivity

Eaton Corporation is a diversified manufacturer with sales of $1.8 billion in 1976 and 18,000 employees in 65 plants in North America. Recently, it embarked on one of the most venturesome attempts to counter worker alienation in the U.S. The approach, referred to as the “new philosophy,” actually dates back to the late 1960s. Eaton was building a new plant in Kearney, NE, and the manager-to-be wanted to avoid the kind of deterioration in employee-management relations he had seen in his old plants.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

So he turned to Baton’s employee relations research and development manager, Donald N. Scobel, for help. Scobel suggested neither job enrich¬ment, job redesign nor participative decision making as possible solutions. Instead, he created something he re¬fers to as “an enriched environment.”

To Scobel, that means two things. First, workers who want to can get in¬volved in working on their own equipment or even total departmental operations, but no one is forced to take more responsibility or participate in an expanded or enriched job if he or she wishes not to.

Secondly, the “new philosophy” em¬phasizes equal treatment of blue-collar and office workers. Specifically:

• A formal hiring process has been replaced with informal “dialogues.” And there’s no probationary period.
• Blue-collar workers no longer punch a clock.
• There’s no formal system of rules and penalties.
• Supervisors are expected— and trained— to handle worker gripes and problems, such as extended ab¬sences or poor performance, through counseling, which, says One supervisor, requires “a lot of good judgment.”

• Production workers are allowed to repair their own equipment, if they are so inclined, and to switch work stations as bottlenecks occur.

• They or their representatives are invited to attend weekly staff meet¬ings, production-planning sessions arid other discussions. Scobel believes that implementa¬tion of the “new philosophy” affects more than morale. It also seems to af¬fect productivity—positively. Some of the verifiable results are:

• Hourly product output in the “new philosophy” plants ranges up to 35% higher than in the old. (New equipment and methods may attribute heavily to this figure, Scobel cau¬tions.)

• Absenteeism is running at a 0.5% to 3% rate in new plants, compared with 6% to 12% in old. Turnover, as the result of voluntary resignations, has been as high as 60% in old plants but is about 4% in new.

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.

There also have been some iownside” results:

• The safety records of new plants is poorer, perhaps because of workers’ greater flexibility in performing dif¬ferent tasks and repairing equip¬ment.
• Some supervisors and managers can’t cope with the flexibility and have had to be replaced by mana¬gers with more tolerance for am¬biguity.
• Some employees abuse the situation.

Employees tend to like the new philosophy. Some find that they can flexi-schedule themselves to take advantage of a long, mid-day break. Others report feeling more responsible, and many enjoy being treated like adults.
Bottom-line: At Eaton, at least, treating workers as adults pays off, not only in worker satisfaction but in productivity as well.

Source : Training Magazine Edisition January 1979

You can download excellent powerpoint slides on HR management, business strategy and personal development HERE.