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High Performance Work Systems

By cfellers91 May 12, 2014 3581 Words


Does a High Performance Work System have the Ability to Induce Higher Job Satisfaction and Job Performance?

Abstract
The idea that a happy worker is a hard worker has been discussed and researched since the 1930 Hawthorne experiments. Researchers believed that with increased job satisfaction came an increase in job performance and vice versa. No matter how logical this idea seems, it has not been proven, and the argument continues. This paper looks at the facets of job satisfaction, job performance, how they are measured, and why they cannot be linked. Then, it moves on to cover the idea of a High Performance Work System and why this system is linked to increases in both job satisfaction and job performance. Through examination of research as well as business and sports examples, it is proven that a high performance environment is the key to promoting both high job satisfaction and job performance.

Does a High Performance Work System have the Ability to Induce Higher Job Satisfaction and Job Performance?
Since the 1930’s Hawthorne experiments, researchers have struggled with understanding the connection, if there is one, between job satisfaction and job performance. Although many people believe that there is a positive correlation between the two, research has proved inconclusive. Therefore, the question has remained unsolved. This topic is complex, and due to the fact different employees have varying attitudes, situations, and motivating factors, it has been a difficult question to answer. By comparing job satisfaction and job performance to the characteristics of a high performance work system, there is a clear connection between the three. By answering the following questions, the connection between the three will be made clear.

1. How is Job Satisfaction measured?
2. How is Job Performance measured?
3. Why can’t these two aspects of employee behavior be linked?
4. What is a High Performance Work System?
5. What is the Real-Life Connection between this System and Successful Teams (Sports and Business)? 6. How does High Performance promote Satisfaction among Team Members? 7. How does High Performance promote Performance among Team Members? Due to the different factors motivating people at work, it has been impossible for researchers to find a definite correlation between job performance and job satisfaction. However, these two highly scrutinized aspects of employee behavior are often a positive result of a high performance work system. How is Job Satisfaction measured?

Measuring job satisfaction is a complex task because it is difficult to develop quantitative tools for measuring the emotions one feels towards his/her job. One must rely on answers driven by emotions. When attempting to measure job satisfaction, companies usually choose to employ one of these three strategies: focus groups, interviews, or employee surveys. The main issue with the first two is that responses in focus groups or interviews can be tainted by a person’s attempt to appease others in the group or the interviewer. This results in an inaccurate sampling of employee satisfaction. The third option, surveys, which have their issues as well tend to be the most accurate because they eliminate the need to alter one’s answers for fear of judgment by peers or supervisors. The two most commonly used tests are the Cornell Job Descriptive Index and the Minnesota Satisfaction Questionnaire (Saari & Judge, 2004). Out of the two, it has been accepted that the Cornell Job Descriptive Index is the best measure of job satisfaction. The Cornell Job Descriptive Index, widely acknowledged as the most reliable, is intended to pass several different tests. The survey is designed so that it can be used over a wide range of job classifications, covers different aspects of the possible work situations, and is reliable in terms of internal consistency and long-term stability (Cain Smith). The test covers five different areas of satisfaction: overall satisfaction with work, satisfaction with pay, satisfaction with opportunities for promotion, satisfaction with supervision, and satisfaction with co-workers. The creators of this test chose these facets of work because they can be applied to any level and manner of work. In each section of the index, there are a series of adjectives or phrases describing a person’s work. The person then marks a Yes, No, or ? (Cannot Decide) next to each adjective or phrase to indicate the way they view their job. To increase the reliability of the test, the sample subjects were asked to complete the test in regards to their current job, the best job they could imagine, and the worst job they could imagine. Using these tests, researchers decided which phrases signified satisfaction and/or dissatisfaction with work and which ones seemed to be irrelevant or unreliable. This preparation was successful in achieving what they had hoped for. The consistency level for the test was between .8 and .88. Furthermore, the correlation between the five different test areas was low, at .37. This was an important factor because it showed the researchers that they were testing different areas of work, as opposed to repeatedly testing the same area with different words (Cain Smith). The development of the Cornell Job Descriptive Index was significant because it gave employers and researchers a fairly reliable way to test the job satisfaction of employees. By utilizing this test while also analyzing job performance, it is clear that the relationship between the two cannot be defined. Even though this can be a tough area of employee behavior to measure, it is important to do so. Its benefit is that it allows teams to see what areas they need to improve and how this is related to their overall system. How is Job Performance measured?

Measuring job performance can be time consuming, but obtaining an accurate measurement is much easier because job performance can be quantified. When measuring job performance, one must decide which areas of overall job performance, one would like to account for. There are many different areas such as quantity of units produced, quality of work, timeliness, absenteeism, tardiness, manager appraisal, self-appraisal, 360-appraisal, and the list goes on (Hakala, 2008). To provide employers with a more sound approach to measuring performance, Robert Kaplan and David Norton developed the “Balanced Scorecard” approach. This survey allows employers to measure several different areas of performance and combine the areas to produce a score for each employee that accurately reflects their personal performance. This was important because it simplified the task of measuring and scoring multiple categories. The more categories that an employer chooses to score, the more reliable the analysis becomes (A Handbook for Measuring Employee Performance). Why can’t these two aspects of employee behavior be linked?

It seems that common sense would allow people to make the connection that a happy worker is more likely to be a productive worker, and this is the problem people have struggled with for decades. Although continued testing has shown that there is no conclusive connection between job satisfaction and job performance, people continue to search for that illusive answer. Realistically, after so many years, they have found their answer. People just refuse to believe it. Job satisfaction does not produce a higher level of job performance.

In the 1930’s General Electric had the idea that if companies were to increase the lighting in company warehouses etc., companies could increase their production. To test this theory, GE hired Elton Mayo and his team of researchers to conduct a series of experiments that would become known as the Hawthorne studies. During the first trial, the lighting in the working environment of a warehouse was increased. To GE’s delight, the production levels increased. As they continued to increase the light, production continued to stay higher than the average levels. Unfortunately, when the lights were dimmed below normal levels, production still increased, which disproved the theory that the level of light in a working space correlated to the level of production (Izawa, French, & Hedge, 2011). Although this was disappointing for GE, researchers were still left with the question of why production had continued to increase throughout the experiment. After much thought and deliberation, researchers speculated that the special treatment of being allowed to participate in the experiment had led to the increased productivity. By making these workers feel important, their level of satisfaction in their work had increased, therefore increasing their performance. This seemed to be a completely plausible theory, and further testing was arranged. The group of researchers decided that workers in the next experiment would be split into teams and their individual pay grades would be based on their level of performance. Although performance increased, the employees seemed to find an acceptable level for performance, which the majority of employees tended to produce at. This showed that although a pay-for-performance strategy increased productivity, the acceptance of their peers ultimately controlled their level of performance (Economist.com, 2008). If their theory had been correct, researchers expected to see many employee’s performance levels continue to increase in an effort to gain a higher pay level, but the results seemed to disprove their theory. These experiments gained the attention of many researchers and have been scrutinized for many years. With all findings taken into consideration, along with experimental design flaws, data factors, and uncontrolled work-related factors, researchers deemed the experiments flawed and inconclusive.

One of the factors behind this conclusion is that people have different motivating factors behind why they decide to undertake a certain occupation. These motivating factors lead people to carry one of three possible different attitudes about their work: instrumental1, solidaristic2, or bureaucratic3. These three different attitudes have the possibility to change the attitude and/or the performance level of an employee. For example, someone who has an instrumental attitude toward their work may not be motivated to do any more than the bare minimum, but they may be satisfied with their position and wish to retain the job. In this case, job satisfaction would not be enough to increase job performance. On the other hand, someone who carries a bureaucratic attitude towards their job may love their occupation and be motivated to go above and beyond the call of duty. In this case, job satisfaction could be connected with job performance. With these attitudes in mind, the reasoning behind the reoccurring result of inconclusive evidence is explainable (Furaker, Hakannson, & Karlsson). What is a High Performance Work System?

Over the last few decades, and especially in the last few years, due to the recession, managers have been looking for ways to increase productivity and retain employees. A High Performance Work System, although not traditional, allows a company to accomplish both these goals. In order for a company to create a high performance environment, managers must relinquish control and convert from a vertically organized system to a horizontal, decentralized group (Kling). By decentralizing power, a company is able to make better judgments because more people have an influence on the final decision. Workers, who may not usually be included in the decision making process, may have insight and a direct understanding of how certain issues should be solved, and these people can be a serious asset if properly utilized by a company.

Creating a high performance system can’t stop at decentralization. Companies should look to employ different tactics and perks for their employees such as incentive pay, job security, information sharing, formal training, and teamwork. Combining these tactics make employees feel happy with their work environment, while giving them a sense of empowerment. Employees who feel empowered begin to embrace responsibility, decision-making, and problem solving on the job. This leads to not only happy employees, but also productive employees.

High Performance Systems are still resisted by some companies who do not wish to decentralize power. These companies often believe by utilizing below market pricing strategies they can gain market share. Although this is true, companies who sell their products at extremely low prices are going to have find other ways to cut expenses. This often results in a loss of wages for employees. When employees feel the brunt of the cost crunch, they will frequently decide to move to another company or simply resign. When this occurs, companies must fill those empty positions with inexperienced workers. The more inexperienced employees that a company must use, the lower the production levels and the lower the quality of their products. In the end, this type of system may end up being more harmful than helpful. Also, as more companies begin to create high performance environments, it will become standard, and employees will expect an empowering work environment. This is why High Performance Work Systems are essential as teams move forward. How does High Performance promote Satisfaction among Team Members?

The key to a high performance system that promotes satisfaction among team members is the empowerment of a company’s employees. When employees are given the opportunity to take place in company decisions and activities that are more important than their individual job, they feel valuable. On the job, people may feel one or two types of satisfaction. The first, affective satisfaction, has to do with the pleasurable feelings that an individual has about their overall job. The second type, cognitive satisfaction, is fulfilled by a job that satisfies the different aspects of work that are measured by the Cornell Job Description Index (Cain Smith). Although cognitive job satisfaction is important to fulfill, it does not necessarily improve performance, and it can be fulfilled by a job that does not employ a high performance system. High performance systems are unique because they are able to fulfill the affective satisfaction that one can feel for their job. The responsibility and importance that this system offers provides a pleasurable feeling towards one’s job. Although this cannot be quantified, and therefore is harder to prove, it is evident in several success stories that have come about from this system. How does High Performance promote Performance among Team Members? Although the level of satisfaction is hard to quantify due to the type of satisfaction provided by a high performance system, the level of performance increase is easily discernible. One of the most important aspects of a High Performance Work System for companies is formal training. This shows employees that the company is concerned about the improvement of its employees, and in turn, improved employees are able to produce more efficiently. In a Bureau of Labor Statistics survey taken on small manufacturing firms in Michigan, those who afforded extra formal training to their employees saw a 7% reduction in scrap products4. Also, a separate study that compared formal training to productivity showed that companies that furthered formal training for their employees saw a 19% increase in productivity over three years. When a company is able to increase productivity while increasing the quality of their products this can be a serious advantage. Not only will they be able to sell a higher quantity, but also their products will be in higher demand because the product will be recognized as high quality. Attention to quality also saves the company money because less product is wasted during production, which means that the value of their raw materials increases (Kling). Furthermore, these studies have been proven in the real business world. According to BLS.Gov, Fortune 1000 companies who used at least one High Performance Work System practice saw increases in productivity of 60% and an increase in the quality of their products of 70%. Although it has been proven that a high performance environment can produce increases in job performance, one may ask, why does this increase occur? The reasoning behind the increase has to do with the improvement in skills as well as the mindset of the employees in this environment. Cognitive satisfaction, as discussed earlier, does not increase production, because an employee can be cognitively satisfied and be producing at the bare minimum. When employees are satisfied beyond a cognitive level, they are motivated to contribute to the company. This motivation and belief in company goals, combined with an increased skill level, has a direct influence on job performance. What is the Real-Life Connection between this System and Successful Teams (Sports and Business)?

Throughout the years, several teams have been able to utilize a High Performance Work System in order to achieve success across many different fields. One prime example was the 1969-1970 New York Knicks coached by Red Holzman. When Holzman took the job, he knew what he wanted to accomplish with the team and set out with a system, he believed, would allow him to achieve it. He believed that the most important thing to do was to keep the game simple and focus on the fundamentals. These could be taught and ingrained in his players’ minds easily. Once these were in place, all that was left to do was to monitor the upkeep of these fundamentals, and to show his players he believed in them by empowering them. During games, Red would often allow players to draw up plays. This showed that he had a great deal of trust in his players and that their opinions were just as important as his. The level of trust and respect that was evident between coach and players allowed Red to get the most from his team. In 1970, when they won the championship, every player averaged more than 10 points per game and 2 assists. Also, when the team’s center, Willis Reed, was injured, he was able to play through the injury to help his team win game 7 and the championship. His injury was considered very severe, and many players would have not been able to play through, but his dedication to his team allowed him to persevere through the pain (Berman, 2013). Although this is simply sport, it is a great example for businesses. To succeed companies need to focus on what is important and find ways to make their employees believe this as well. Once this is done, a team can run itself with a little monitoring. This kind of control places a lot of responsibility on the shoulders of the team members, but as long as they have a manager’s trust, most employees will happily accept it.

Examples of similar success are abundant in the business world as well. Before their founder passed away, UPS maintained an extremely productive High Performance Work System. Their managers were required to go through a basic training that was very hard but prepared them for their job and instilled a real belief in their system. While this system was in place, UPS workers often had to be disciplined for working too many hours. Employees willingly working overtime in the company’s interest does not happen very often, but the system they had in place became so important to the employees that anything less would have been considered insufficient (Oxford, 2013). This shows the influence on job satisfaction and job performance that a high performance system can have. Employees who work overtime in a company’s interest, instead of their own, demonstrate that they are committed to high job performance while being satisfied at the same time.

For many years, researchers have battled over whether or not a connection exists between job satisfaction and job performance. After analyzing and experimenting, it is safe to say that researchers have a solid base of data to draw a conclusion, but some continue to search for an answer. When all the data is taken into account, it is clear that the connection between the two is that at times they can be related, but do not have a connection that persists over time.

On the other hand, creating a High Performance Work System provides the proper environment for both job satisfaction and job performance to increase. When this system is properly established and maintained, this idea holds true in both experiments and the real world. High Performance Work System is an effective solution to increase job satisfaction, job performance, or both.

References
Berman, M. (2013, April 24). 5 Tips for Building a High Performance Work Team -- Red Holzman Style. The Huffington Post. Retrieved May 25, 2013, from http://www.huffingtonpost.com/mike-berman/red-holzman-leadership_b_3116468.html Buchanan, K. (2006, September 4). Job Performance and Satisfaction. Ezine Articles. Retrieved May 17, 2013, from http://ezinearticles.com/?Job-Performance-and-Satisfaction&id=290072 Cain Smith, P. (n.d.). The Development of a Method of measuring Job Satisfaction: The Cornell Studies. Retrieved May 20, 2013, from sba.oakland.edu Denhartog, D. N., & Verburg, R. M. (2004). High Performance Work Systems, Organizational Culture, and Firm Effectiveness [Abstract]. Human Resource Management Journal, 14(1), 55-78. Retrieved May 25, 2013. Furaker, B., Hakannson, K., & Karlsson, J. C. (n.d.). Commitment to Work and Job Satisfaction: Studies of Work Orientations (Routledge Studies in Management, Organizations and Society) [Kindle Edition]. Retrieved May 14, 2013. Hakala, D. (2008, February 19). 16 Ways to Measure Employee Performance - HR World. HR World. Retrieved May 20, 2013, from http://www.hrworld.com/features/16-ways-measure-performance-021908/ A Handbook for measuring Employee performance. (n.d.). Retrieved May 15, 2013, from http://www.opm.gov/policy-data-oversight/performance-management/measuring/employee_performance_handbook.pdf The Hawthorne Effect. (2008, November 3). The Economist. Retrieved May 18, 2013, from http://www.economist.com/node/12510632 THE HAWTHORNE STUDIES. (n.d.). World Academy Online. Retrieved May 17, 2013, fromhttp://worldacademyonline.com/article/27/383/the_hawthorne_studies.html Izawa, M. R., French, M. D., & Hedge, A. (2011). Shining New Light on the Hawthorne Illumination Experiments [Abstract]. Human Factors: The Journal of the Human Factors and Ergonomics Society, 53(5), 528-547. Kling, J. (n.d.). High Performance Work Systems and Firm Performance. BLS.gov. Retrieved May 24, 2013. Oxford, C. (2013, May 7). Where the Happy Talk About Corporate Culture Is Wrong. Nytimes.com. Retrieved May 25, 2013, from http://boss.blogs.nytimes.com/2013/05/07/where-the-happy-talk-about-corporate-culture-is-wrong/ Saari, L. M., & Judge, T. A. (2004). Employee Attitudes and Job Satisfaction [Abstract]. Wiley Interscience, 43(4),

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