MGT 3231 The High Performance Organization  Contingency approach to OB???  What do successful organizations have in common?  Careful with “best practices” and “benchmarking.”

MGT 3232 External Environment and OB: Performance Context  Economic and social conditions: Changing customer expectations – Total Quality Management (TQM). Meeting customer needs. Doing tasks right the first time. – Continuous improvement. Is this necessary? If so, can it be done better?

MGT 3233  Customers and Employees.. Most important – Upside-down pyramid view of organizations. Customers and clients at the top of organization. Workers directly affect customers and clients. Team leaders and middle managers directly support the workers. Top managers clarify the mission and objectives, set strategies, and make adequate resources available.

MGT 3234 What is a high performance organization?  High performance organizations (HPOs). – HPOs intentionally designed to: Bring out the best in people. Produce organizational capability that delivers sustainable organizational results. – HPOs place people first. Knowledge based economy

MGT 3235 What is a high performance organization?  Emphasis on intellectual capital. – Intellectual capital is the foundation for HPOs. – To utilize intellectual capital, HPOs often organize work-flow around key business processes and use work teams within these processes.

MGT 3236 What is a high performance organization?  Key components utilized in HPOs. – Employee involvement. – Self-directing work teams. – Integrated production technologies. – Organizational learning. – Total quality management.

MGT 3237 What is a high performance organization?  Employee involvement. – The amount of decision making delegated to workers at all levels. – Employment involvement can be visualized on a continuum. No involvement or parallel involvement. Moderate involvement or participative management. High involvement or employee empowerment.

MGT 3238 What is a high performance organization?  Self-directing work teams. – Empowered to make decisions about planning, doing, and evaluating their work. – Sometimes called self-managing or self- leading work teams. – Important in HPOs due to: Need to tap employees’ expertise and knowledge. Need for employees to manage themselves.

MGT 3239 What is a high performance organization?  Integrated production technologies. – Focus on providing flexibility in manufacturing and services and involves job design and information technology. – Key components: Just-in-time systems. Use of computers.

MGT What is a high performance organization?  Organizational learning. – A way for organizations to adapt to their settings and to gather information to anticipate future changes. – HPOs are designed for organizational learning.

MGT What is a high performance organization?  Total quality management (TQM). – A total commitment to: High-quality results. Continuous improvement. Meeting customer needs. – TQM is a a tightly integrated part of HPOs. Encourages all workers to do their own quality planning and checking.

MGT What are the management challenges of high performance organizations?  Challenges of environmental linkages. – HPOs are open systems influenced by a rapidly moving external environment. – Open systems components. Inputs: worksite problems and opportunities, and vision, mission, and strategy. Transformation processes: five HPO components. Outputs: individual, group, and organizational effectiveness, and contributions.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – HPO component: employee involvement. Flat and lean hierarchy. Heavy team emphasis throughout organization. Paper work minimized. Rapid decision making emphasized. People were empowered to do “whatever it takes” to get the job done.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – HPO component: self-directing work teams. Longer term service teams. Ad hoc teams for given projects or duties. Culture promotes cooperative activities.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – HPO component: integrated production technologies. Integrated use of information technology in distribution, order entry, crew pairings, dispatching of flights, revenue management, schedule planning, and parts replacement.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – HPO component: organizational learning. Deeply rooted in Southwest’s culture. Letters and newsletters about company business. Managers encourage workers to spend time at jobs other than their own. Southwest’s “University for People.”

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – HPO component: total quality management. “Southwest Spirit” focusing on a strong work ethic, a strong desire for quality work, going beyond the call of duty, helping others, and doing the “right” thing. TQM qualities are reinforced by empowerment, learning, and communications devices.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – Other HPO considerations: vision/direction setting package. “The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit.” Strategic elements in direction setting. Core values.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – Other HPO considerations: the people. Attitude reflecting “Southwest Spirit” is a key hiring requirement. Attitude more important than other hiring qualifications.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – Other HPO considerations: compensation. Flight attendants paid by the trip. Incentives for employee performance. Pilots’ salaries are comparable to other airlines but they fly 40% more hours. Profit sharing and pension plans. Usual airline fringe benefits.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – Other HPO considerations: dealing with the environment. Southwest flourishes in a deregulated environment. Southwest’s HPO attributes serve it well in dealing with a highly competitive environment.

MGT How do high performance organizations operate?  Southwest Airlines as an HPO. – Other HPO considerations: outcomes. Highly satisfied employees. Strong commitment to the company. Low turnover. Strong performance on various productivity measures. Active in contributing to the communities in which it operates.