Putting People First

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|PUTTING PEOPLE FIRST FOR ORGANIZATIONAL SUCCESS | |By: Pfeifer, Jeffrey, Veiga, John F., Academy of Management Executive, 10795545, May99, Vol. 13, Issue 2 | |Database: Business Source Premier | | | |Executive Overview | |There's a disturbing disconnect in organizational management. Research, experience, and common sense all increasingly point to a direct | |relationship between a company's financial success and its commitment to management practices that treat people as assets. Yet trends in | |management practice are actually moving away from these very principles. Why is common sense so remarkably uncommon when it comes to managing| |people? Why do organizations habitually overlook readily available opportunities to boost their financial performance? Drawing on extensive | |empirical research, an irrefutable business case can be made that the culture and capabilities of an organization--derived from the way it | |manages its people--are the real and enduring sources of competitive advantage. Managers today must begin to take seriously the often heard, | |yet frequently ignored, adage that "people are our most important asset." | |Over the past decade or so, numerous rigorous studies conducted both within specific industries and in samples of organizations that cross | |industries have demonstrated the enormous economic returns obtained through the implementation of what are variously called high involvement,| |high performance, or high commitment management practices. Furthermore, much of this research serves to validate earlier writing on | |participative management and employee involvement. But even as these research results pile up, trends in actual management practice are, in | |many instances, moving in a direction exactly opposite to what this growing body of evidence prescribes. Moreover, this disjuncture between | |knowledge and management practice is occurring at the same time that organizations, confronted with a very competitive environment, are | |frantically looking for some magic elixir that will provide sustained success, at least over some reasonable period of time. | |Rather than putting their people first, numerous firms have sought solutions to competitive challenges in places and means that have not been| |very productive--treating their businesses as portfolios of assets to be bought and sold in an effort to find the right competitive niche, | |downsizing and outsourcing in a futile attempt to shrink or transact their way to profit, and doing a myriad other things that weaken or | |destroy their organizational culture in efforts to minimize labor costs. | | | | | |Show Me the Evidence | |Though we could go on at length about a company like Apple as a case in point (see "The Apple Story"), executives frequently say, "don't just| |give me anecdotes specifically selected to make some point. Show me the evidence!" Fortunately, there is a...
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