The Untrained, Unempowered Masses

Dec. 21, 2004
Manufacturers resist proven employee practices.

It can be shown both statistically and in practice that one of the tickets to becoming a world-class plant and achieving better performance is the empowerment and training of workers. World-class plants responding to the IW Census, as well as finalists in IndustryWeek's America's Best Plants program, consistently empower more and train more, and rely on both initiatives to keep a crisp edge on operations and outdistance the competition. Plants that take empowerment and training seriously rank among the best performers in key areas such as quality, technology implementation, and relationships with customers and suppliers. However, implementation levels for both initiatives are low and have remained flat at best during the three years in which the IW Census has been conducted. Of particular note in this year's IW Census is a finding that nearly 35% of plant-level executives said empowered or self-directed work teams have not been implemented, compared with the 30.8% reported in last year's survey. Meanwhile, more than 66% said one-quarter or less of their workforce participates in empowered or self-directed teams. Also of note is that just 4.6% of plants empower the entire workforce. Annual training hours for most plant employees also fall well short of the 40 that is considered minimally acceptable by many experts. More than one-quarter of respondents said workers receive less than eight hours of training per year, again relatively flat when compared with training-implementation rates reported in previous years' surveys. Can a case be made that firms simply do not understand the importance of empowerment and training despite statistical and practical proof that the initiatives lead to better performance? Probably not. In the area of empowerment, for example, 83.4% of plant-level managers said self-directed work teams are either "somewhat effective" or "extremely effective." So the question is, why do so many firms find themselves talking the talk of empowerment and training but unable to walk the walk? "It really is puzzling," says Peter Ward, associate professor of operations management and associate director of the Center for Excellence in Manufacturing at the Fisher College of Business, Ohio State University, Columbus. "Virtually 100% of the [America's Best Plants winners] are empowered, and you also see that well over 40 hours a year are devoted to training. That, to me, is pretty powerful evidence of a correlation between empowerment and training and how to become a Best Plant." Ward speculates that empowerment and training lose priority because many firms rightly are preoccupied with quality issues and how best to implement technology and manage inventory. But, he notes, the failure to link empowerment and training with quality and other concerns in a sustained program over a period of years leads to lax performance. "The real performance boost comes from doing a lot of things well," he says. "The trick to [increasing performance] is to understand that the whole is greater than the sum of the parts." One of the best ways to improve quality, Ward says, is to include empowerment and training components -- an approach many plants somehow overlook. "Any quality program should include team-building and educating workers," he says. "Those two go hand-in-hand." Like Ward, Marty Cohen, vice president of client services and programs at the Work in America Institute, Scarsdale, N.Y., says the gulf between brainstorming about empowerment and training and putting progressive programs in place often is hard to bridge. Cohen ventures that the gap between doers and talkers has something to do with an inability to view training as an investment and the pressures boards of directors place upon executives to slash costs. Senior management may say they see people as assets, he says, but that may be only lip service as modern corporate realities force more and more executives to make deep cuts both in personnel and in training. "This has continued to impact unfavorably in the past two years because of a never-ending series of mergers and acquisitions," Cohen says. "Within many of these corporations, transactions are being driven by stock prices and synergies at the top. You're losing both the people who could have been trained and the people who championed training."

Training Emphasis
Percentage of plants in each category reporting training levels
Annual hours of formal training per employee Total Census survey Fully achieved world-class America's Best Plants finalists/winners
Less than 8 hours 25.9% 5.5% 1.6%
8-20 hours 41.0% 50.9% 3.2%
21-40 hours 21.9% 23.6% 40.3%
More than 40 hours 11.1% 20.0% 54.8%
On the empowerment front, Cohen says, plenty of dinosaurs continue to exist in the executive suites of businesses. "There are still a number of people who, when given the chance, will invest in the machine rather than the person," he says. "There certainly is more than one generation of managers brought up in the command-and-control system who don't feel comfortable managing an empowered workforce." But, he adds, the problem is not limited to senior management. Workers accustomed to letting bosses make decisions and accept accountability aren't always eager to embrace empowerment. "People on the shop floor resist change," he says.
Empowerment & Productivity
Median productivity of plants in each category
Percentage of empowered workforce Median productivity
No empowered workers $150,000
1% to 25% $150,000
26% to 50% $165,000
51% to 75% $166,000
76% to 99% $180,000
100% empowered $237,000
Total survey sample $150,000
Perhaps helping to widen the gap between talk and action is a tendency by detractors of empowered workforces to tell "runaway team" stories in which the implied message is that employees easily lose focus if management's hand is not a constant presence, Cohen says. ABB Industrial Systems Inc., a Best Plants winner in 1996, champions empowerment and training, saying its workers are more focused than ever. Ken Morris, a senior vice president, says some firms have trouble making the leap from talking about strategies to implementing them because they can't envision finding answers to some fundamental questions. If workers are in charge of their own teams, many companies ask, what happens to the traditional supervisors and decision-makers? That question, Morris observes, leads to another series of questions: "Who does performance reviews and pay raises? Who gives pats on the back? Who resolves conflict?" When companies can't find easy answers or visualize a successful outcome, he says, many abandon empowerment and training strategies or engage in word games to create the appearance of change when the reality is that their tires are still stuck in the mud. "They may rename [a practice] and call it a team, but it's really just a matter of semantics, with the same decision-maker still in place," he says. "What you have to do is describe a new process and implement systems that are different from the traditional supervisor."

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