By Ian Glendinning (Contact)
(Back to K-Blog) (Back to
WorkinProgress)
Supervised by
Prof Sandra Dawson
(Currently Director of the Judge Institute,
Management School at Cambridge University)
A
dissertation submitted in partial fulfillment of requirements for the
Master
of Business Administration Degree, and the
Diploma
of Imperial College
IMPERIAL COLLEGE OF SCIENCE, TECHNOLOGY AND
MEDICINE
University of London
(Now known as the
Tanaka Management School,
where my course tutor Prof Dorothy Griffiths
is
Deputy Director of the school.)
Dec
1991 - Submitted and awarded highest grade for MBA Project Dissertations that
year.
Jun 1992 - Figures updated to capture all late survey results, no text changes.
Apr 1994
- Note and reference added to subsequent leadership analysis.
Feb 2002
- This on-line HTML version prepared – Text complete / Figures incomplete.
Feb 2006 - Updated with broken links fixed and scanned copies of questionnaires
linked.
INDEX
OF CONTENTS
CHAPTER 2 - THE COMPANY AND ITS BUSINESS
CHAPTER 3 - CHANGE AND FLEXIBILITY - A CURRENT FASHION?
CHAPTER 4 - ORGANISATIONAL LEARNING
CHAPTER 5 - PERFORMING A STAFF SURVEY
CHAPTER 6 - ANALYSIS OF THE OVERALL RESPONSE TO THE SURVEY
CHAPTER 7 - SURVEY ANALYSIS ACCORDING TO RESPONDENT SAMPLE
GROUPS
CHAPTER 8 - DISCUSSION AND CONCLUSIONS
CHAPTER 10 - CONCLUDING REMARKS
APPENDIX
B - COMPANY ORGANISATION AND STRUCTURE (Figure not included)
APPENDIX
C - PROCESS PLANTS DIVISION STAFF PROFILE (Figure not included)
APPENDIX
D - THE STAFF SURVEY QUESTIONN
APPENDIX
S - SURVEY SUMMARY AFTER 90 RESPONSES (Figure not included)
This dissertation
includes consideration of attitudes and cultural aspects relevant to the
management of change within an engineering contracting organisation. An outline
of the existing organisation is presented, and a perceived history of
difficulty in achieving change is noted. The dissertation includes discussion
of literature on the subject of organisational change, in particular, recent
literature emphasising the unpredictability of change in the 90's and beyond.
Also
reported are the conduct and findings of a staff survey concerned with their
perception of the organisation and the experience of change within it.
Analysis
of the survey response concludes that the organisation possesses strengths in
Total Quality Management and Project Management resources, but that there are
weaknesses in the culture and leadership of the organisation, which inhibit
change and flexibility.
Recommendations are presented which are intended to exploit the
strengths in overcoming the weaknesses in the areas of corporate identity,
wider measures of performance and the development of management style.
Firstly,
acknowledgements go to Foster Wheeler in general for their sponsorship of the
course; in particular to Jim Foley for his support of this project; to Kevin
Tremlett and Peter deCourcy for assistance from personnel department; and to my
long suffering managers, Peter Underwood, Doug Slawson and Dave Crease. Thanks
also to all those Foster Wheeler staff who took the trouble to respond to the
survey.
Special
thanks are due in particular to Sandra Dawson for her assistance with the
project in general and especially for the encouragement given when the going
got tough.
THIS
DISSERTATION CONTAINS MATERIAL THAT WAS CONSIDERED STRICTLY PRIVATE AND
CONFIDENTIAL FOR THREE YEARS FROM THE DATE OF PUBLICATION. PRIOR ACCESS WAS
RESTRICTED AND GRANTED WITH THE SOLE PERMISSION OF FOSTER WHEELER ENERGY
LIMITED.
Dedicated
to Sylvia, Tom and Robbie .....
THE
SUBJECT
The subject
of this dissertation is change and flexibility, specifically in connection with
my employer, Foster Wheeler, a process industries engineering and construction
contractor. The motivations behind looking at such a wide and complex issue
within the company are threefold: -
Firstly,
there is a perception within the company that there is a myriad of preserved
errors and/or missed opportunities for innovation. For example, looking at much
process plant hardware under construction, one would find many details
unchanged since pre-war days. Similarly, reports on engineering and
construction operations typically include recurring technical and interface
difficulties. Individually, many such instances may be trivial. Individually,
the existence of many may be rationally justifiable. Collectively, their number
and apparent endurance represent a cause for concern.
Secondly,
there is a perception that Information Technology, which pervades our operation
and our deliverables, far from increasing flexibility, creates new constraints.
There has been, and continues to be, major investment in IT and a shift from
centralised mainframe systems to distributed Personal Computer and workstation
based systems. Despite islands of success, and clear marketing benefits, there
is disappointment and frustration that tangible benefits from such innovation
are slow to materialise in the operation itself.
Thirdly,
change and flexibility, as strategic issues for any firm in any industry, have
become subjects for a mass of current press, learned texts and fashionable
"airport bookstall" literature (37).
The
questions prompted by these perceptions, and addressed in this dissertation,
concern whether the first two issues are as a result of underlying problems
with the management of change and flexibility, and whether the third offers an
appropriate strategy or general solution for them.
As the
opening paragraph suggests, this is a wide and complex subject. Many texts
whose titles include some permutation of Change, Strategy and Management, read
like general management texts, covering such subjects as : Planning,
implementation and control; Decision making; Power and authority; Structure,
systems, organisation and technology; People, attitudes and motivation; Rewards
and performance measurement; and so on.
Even
more so than Pettigrew and Whipp (50), authors of the latest UK research based
text on this subject, I must include in this dissertation, their "caveat
emptor”:
"There
is no single best practice in managing change. No quick fix is being
offered."
THE
OBJECTIVE
Having
noted that the subject is wide, and that the questions implied above are too
complex to expect exhaustive answers, I must declare a more limited objective.
I have
approached the subject with the belief that the underlying nature of the
perceived problems concerns people, attitudes and the culture of the
organisation. I have therefore chosen to focus on these issues. In essence my
objective is to answer the following question: -
"What
are Foster Wheeler's strengths and weaknesses in the areas of people, attitudes
and culture relevant to managing change? How might these be exploited or
mitigated in order to improve our future flexibility?"
THE
METHODOLOGY
The project
on which this dissertation is based had two principal phases.
Firstly,
there was a review of available literature on the subject of change management
generally and following up secondary references on issues arising, in order to
construct a model of change. Far from converging on key themes, this exercise
led to ever broadening avenues of investigation on the widest range of
management issues. One particular model of managed flexibility, the
"Organisational Learning" model was chosen as a framework on which to
hang a selection of relevant issues (5).
Secondly,
in order to focus on the issues in the context of Foster Wheeler, a survey was
conducted within the company. The survey was conducted using questionnaires
based on checklists suggested by Carnall (17).
THE
DISSERTATION
In
addition to describing the above activities, this dissertation includes
analysis of the survey responses, and discussion in the light of the
literature, leading to recommendations for action and further investigation.
However,
before describing the findings of these aspects of the project, I need to set
the context, as indeed I needed to do before embarking on the project itself.
With over thirteen years with the company, I was conscious that I had
preconceptions at the start of the project, which were likely to be subjective.
In order to establish a more objective picture of Foster Wheeler and its
business I performed an analysis of reports and accounts from Foster Wheeler
and a sample of competitors for the past decade. Much detail of this analysis
is not relevant to this dissertation, and in any event might be considered
commercially sensitive. The next chapter, however, draws on this analysis, as
well as my personal experience, to paint a background picture of Foster Wheeler,
its industry, its business performance and its organisation.
GENERAL
The
company under analysis is Foster Wheeler Energy Ltd (FWEL) and, if we are to
look at change and future flexibility, we need a base case; a snapshot of what
FWEL is now. This section provides such a description of the company, its
business and its recent performance.
FWEL is
a UK based Engineering and Construction (E&C) Contractor, which is wholly
owned by Foster Wheeler Corporation (FWC), via Foster Wheeler Ltd (FWL), a UK
holding company. FWC is a US Corporation listed on the New York Stock Exchange
and 1991 represented a centenary since the original Wheeler Condenser and
Engineering Company was formed. From the UK perspective, 1990 represented 70
years since its original formation in the Power Specialty Company Limited in
London.
Two
thirds of FWC's current operations are in E&C, serving energy and process
industries, and most of the remaining third is concerned with related energy equipment
and services. A significant and growing part of the business is in "own
and operate" projects for waste to energy and flexible high efficiency
power generation facilities. Foster Wheeler, including its UK based operations,
has a long history in power generation, involving design and manufacture of
fossil fired boilers for utility power stations and marine propulsion, and of
nuclear power plant components. Though still involved in design of fired
heaters for process plants, these power industry aspects no longer form a
significant part of the UK operation.
FWEL is
currently the largest of the five main subsidiaries within FWC's E&C group,
which operate in the US, the UK, France, Italy and Spain. In 1990 FWEL contributed
more than $250m to a corporation turnover of $1700m. Each of the five main
E&C contractors operates internationally, historically in its own local
region and typically in those areas where the home country had colonial
interests and a common language. In recent years however, by agreement within
the corporation, each tenders for contracts anywhere where its resources are
better able to serve the client's project.
FWEL,
based in Reading and Glasgow, therefore operates throughout the world. Recent
and current project locations include mainly the UK, Europe, south east Asia,
and Indonesia, as well as Scandinavia, and parts of Africa, the Indian
subcontinent, the Middle East, South America, the Caribbean and Australasia.
As
already noted, the E&C service is provided mainly in support of capital
investment in the process industries. These include onshore and offshore oil
and gas facilities, petroleum refineries, petrochemicals, general chemicals,
fine chemicals and pharmaceuticals. Not surprisingly therefore, important
clients include household names like BP, Exxon, Shell, ICI and Glaxo, and often
these operators have significant interests in some of the less well known
clients. Recent areas of diversification, serving a different client base, have
included combined heat and power generation, waste treatment, water supply,
factory automation, rail transport and even a cryogenic wind tunnel.
The
E&C service includes any or all of project management, specialist
engineering, purchasing, logistics, construction and commissioning, but can
also include project appraisal, conceptual engineering, project financing,
operator training and even plant operation. FWEL does not operate as a
manufacturer of plant equipment and in the past decade, in common with all UK
and most European competitors, has generally subcontracted construction
services. There are however, fabrication affiliates, and FWEL has started a
move back [since reversed] to direct labour construction, where a significant
proportion of value is added to a typical project.
Because
of the range of services involved and the range of industries served, it is
very difficult to talk in terms of the total world market and market share
vis-à-vis our competitors. Most of FWEL's competitors are also part of diversified
groups and corporations who operate in overlapping vertical and horizontal
segments of the market.
Horizontal
diversification includes for some; E&C services to oil and gas exploration
and production, mining and mineral extraction, metals processing, food
processing, civil infrastructure and industrial and general building
construction industries. Integration into vertical markets includes for some;
operation of exploration, production and processing facilities, and manufacture
or fabrication of plant or systems involved in any of the services or
industries mentioned.
The
extent of segment overlap amongst individual competitor operations is highly
varied, and in the extreme a few of the holding corporations are highly
diversified conglomerates. Domestically FWEL could consider some twenty E&C
competitors. Internationally up to two hundred E&C companies could be
identified competing in some or all of FWEL's markets.
THE
OPERATION
The
operation consists of a stream of concurrent and overlapping individual
projects.
These
are generally won by open competitive tendering, although in some cases
existing cooperative agreements with clients or rolling "term"
contracts reduce the competitive element in awarding some packages of work. On
the other hand, sales and marketing effort in the competitive phase may include
prequalification even before an invitation to bid is forthcoming. In any event,
there is a significant proposals operation involved in bidding for most
contracts.
As
already inferred, an individual contract may be a simple study, or a full
engineer, procure and construct project, or project management only, or any
other combination of the services mentioned previously. The contract terms can
also vary between lump sum and fully reimbursable, and more typically involve a
hybrid of both, such as reimbursable costs plus fixed fee. As with contract
management in other industries, the terms may be varied between phases of the
project; e.g. reimbursable during uncertain conceptual or pre-engineering
phases and lump sum during detailed phases after a definitive estimate. This
can be further complicated when there is competitive rebidding between
consecutive phases of a project, and there often is.
Typically
a project might last fifteen to eighteen months but could range from a month or
two for a conceptual or "front end" study to five years or more for a
major project management contract. The scale of a project may therefore vary
widely from a handful of people using a few hundred man-hours to produce a
report, to a peak of as many as five hundred people consuming two million
man-hours and procuring several hundred million [or a few billion] dollars
worth of materials and services.
Almost
invariably any project involving a significant number of people over a
significant period is organised as a task force, with specialist staff
physically relocated into designated task force areas or offices. Increasingly,
such task forces place great emphasis on team building, particularly as it is
also increasingly common for such teams to have client personnel integrated
into them.
Naturally,
where the contract scope includes construction and/or operating
responsibilities teams need to be set up at plant fabrication and construction
sites. During other phases it is not unusual for small teams to be established
at the offices of clients or other contractors. Sometimes it is necessary to
set up complete project teams local to clients’ offices or plants, and these
can involve some form of joint venture or partnering with clients or local
contractors.
So far,
we have looked at FW's history and operation in the briefest possible terms,
and later we will look at further aspects of the operation in describing the organisation.
Staying on the historical theme however, it is appropriate that we now look at
recent past performance of the operation as a starting point for future change.
In looking at performance in relation to competitors, we will also be able to
infer a number of features of the industry in competitive strategy terms
characterised by Porter (53).
PERFORMANCE
The
intent here is to look at performance from a recent historical perspective, in
order to infer some relevant features of the industry and FW's position within
it. For the management of change, we will see later that selection of measures
of performance and mechanisms for monitoring them are important issues. For the
limited intent here however, I need only concentrate on the bottom line. This supremely
objective [sic] measure also satisfies the requirement that this background
chapter be as objective as possible. [even accounts can be distorted for
political ends]
An
analysis was performed using a combination of published annual reports, statutory
public accounts and ICC data cards covering FWC, FWL, FWEL and a sample of
competitor operations over the past decade.
Although
a wider range of accounts was analysed, the comparative data is based on FWEL
and 18 other process industries E&C contractor operations in the UK,
ignoring the accounts of the more diversified company groups. The data used
covers the period 1983 to 1990. Detailed figures and graphs resulting from this
analysis are not included in this dissertation, however the following draws on
selected results.
As far
as longer-term performance is concerned FW's history is witness to its success
in satisfying customers and stockholders and in undergoing significant changes
in the industries and client base served. Clearly, part of that change has
involved acquisition, disposal and restructuring within FW and competitor
organisations. This feature in itself gave some difficulty in comparing
equivalent competitor operations at any given time, even during the past
decade.
Longer
term trends and fluctuation in the level of business for FW, and the E&C
industry as a whole, tend to have reflected cycles of recession and growth
affecting the energy industries and capital investment generally. Naturally,
higher profitability has been associated with such periods of higher capital
investment in these industries, where demand for E&C services has tended to
outstrip supply. This was generally not the case during the 80's.
In the
later 80's, since 1987, the figures for FWEC and FWEL show an encouraging 15%
per annum revenue growth trend for both companies, with FWEL certain to improve
on this for 1991. From the general picture however, it is apparent that, whilst
contributing a healthy share of the turnover, FWEL has returned relatively
small profits, but that these are generated from a very low asset base. In
order to draw more specific conclusions, we can examine the comparative ratio
analysis between FWEL and an E&C industry sample average.
FWEL
pre-tax profit margins are indeed low and show a downward trend, but this is
better than the industry average, which returns less than 1.4% in the long
term, compared to 1.9% for FWEL. The perspective from inside FWEL's operation,
comparing operating and pre-tax margins, is even more striking. The bulk of profits,
however small, have arisen largely from non-operating, investment and interest
income. The long term operating profit margin is just over 0.5%. An aggregate
statistic for the period 1983 to 1990 brings this point home. In that period
FWEL turned over $1 billion of contracts, earned pre-tax profits of œ20
million (2%), of which $15 million (75%
of the 2%) came from non-operating income. The picture is however entirely
typical of the industry, with a long-term average operating margin barely over
0.5%.
Typical
also of the industry is the low and erratic level of operating earnings per
employee, with long-term average of around œ400 per employee.
Though
still erratic, returns to capital employed (or net worth or net assets) look
healthier, reflecting the low capital intensity of the industry, with instances
reaching 10 and 20%, and a long term operating average around 4%. The after-tax
return to net worth is an important corporate target set for the FWEL operation
and is clearly aimed at satisfying stock investor's expectations, although it
is not translated into direct measures of operating performance.
A
measure of performance of interest to the operation, the investors and to
competitors is the forward workload, expressed internally in man-hours and externally
in turnover value. Published industry analyses typically include
"boxscores" of the value of contracts won in a given period and the
value of outstanding incomplete contracts at the start of the next period. Both
measures are concerned with success in winning business, and future security or
survival, but are not related to profitability directly. On such measures, FWEL
is currently performing extremely well, with record levels of pre-booked
contracts and forecast workload levels for 1991/2 reaching levels only
previously associated with the early 70's.
The
returns on net assets are again typical of the industry and are achieved
despite low profitability because of the low asset requirements of the E&C
service operation. The industry long term operating return on assets is just
over 3% compared with nearer 4% for FWEL. The low assets are also reflected in
the high asset turnovers achieved in the industry, with FWEL sweating its few
assets significantly more than the average.
The
preceding description of the performance of FWEL and the industry in general,
reflects both the possibilities for change and, paradoxically, one of the
difficulties in gaining advantage through change in this industry. These same
features of the industry point to generic strategies adopted within it.
GENERIC
STRATEGIES
An
obvious route to improved performance, for an operation with very low margins,
is to improve those margins through increased productivity or efficiency. Productivity
here includes producing higher value added for the same costs, as well as
producing the same value at reduced costs. Improving performance through
increased volume is resource limited, skilled human resource limited in this
case, and it is not a simple matter to rectify this by investment. On the other
hand the numbers make productivity improving changes hugely attractive. When
your operating margin is 0.5%, an improvement of 1% in productivity could
treble your operating profits in a perfectly competitive market; but therein
lies the rub.
Firstly,
the market is oligopolistic in the sense that contract prices are set in
competitive bidding and there can be only limited flexibility to relate prices
to our costs, our capacity and our desired margins. Secondly, whilst contract
pricing includes a reimbursable element, productivity improvements do not
accrue to the contractor directly, and may materialise only through incentive
bonus arrangements.
Related
to both of these is the client power in this market, not just in defining the
final product, whether plant or paper deliverable, but in defining the detailed
scope of the service during the course of the project. To a large extent the
content of the operation, and hence any change in it, is driven directly by
client requirements. Productivity improvements that add additional value during
a project may not result in additional earnings and as already noted those that
save costs may not benefit the contractor. Even those that save schedule may
not benefit the contractor directly.
This
particular feature of client power in setting contract terms can be over
emphasised, but it does mean that they tend to have a very detailed knowledge
of contractors' operations and costs, a feature that can only limit price
setting flexibility.
Another
feature of the industry that greatly limits the ability to sustain operational
competitive advantages is the high level of market intelligence. As already
noted clients have intimate knowledge of our operations, as they do of all
contractors they become involved with. The client organisations are therefore a
channel for exchange of project operational ideas from project to project, from
contractor to contractor. The industry also has a fairly cosmopolitan
workforce, with a turnover of staff between contractors and between contractors
and clients, and there is also a floating pool of agency and contract
personnel. In general FWEL has had a lower level of such temporary staff than
its competitors.
Another
channel for exchange of intelligence is the market for hardware, systems and
services sub-supplied to contractors on projects. In some particular segments,
like for example, the supply of Computer Aided Design ( CAD ) systems, these
suppliers can also have considerable monopoly power.
Despite
focussing on some very narrow measures of performance, and not having performed
a rigorous Porter analysis of industry structure, we are able to deduce that it
is by nature a low profits industry.
We have
high internal rivalry and high buyer power. Barriers to entry to the market as
a whole or to new sectors are mainly experience, a name and a reputation. Once
in, the barriers to providing new services or servicing new sectors are
generally low, the principal resource limitation being the human resource.
Despite this the operation itself does not benefit from economies of scale
except in certain areas of marketing.
For
reasons already noted strategies aimed at low costs and high productivity are
difficult to exploit and difficult to sustain. Also, although buyers have good
intelligence and high power, their incentive to drive down the costs of the
E&C service are not as great as might first appear. The cost of this
service may represent less than 10% of their capital investment in a project
and they may be more concerned that the quality of this 10% does not put the
other 90% at risk.
Conversely,
a strategy focussing on particular segments may have marketing merits, but this
focus must change as the market changes. There is little competitive advantage
in focussing the operations capabilities on too narrow a product range.
The
generic strategy adopted is one of differentiation on quality, but providing
the widest range of services to the widest range of industry sectors. In fact a
stated objective of FWEL is " To be in a position to command fees higher
than the competition ", whilst continuing to be a process industries
E&C contractor not limited to any particular sectors.
Before
looking at the issue of change and flexibility in general, we have analysed
very briefly the nature of the industry. Whilst we have drawn no conclusions
concerning any specific changes either necessary or possible, the objective has
been to make the following two points :
It is
an industry where a competitive advantage is very difficult to sustain once
achieved. This means that is is essential to introduce improvements
continuously just to keep half a step ahead of the competition, because they
too must be introducing change continuously in order not to fall more than half
a step behind. Everyone must run just to stand still.
If this
is a depressing prospect in a low profit industry, then there is another side
to the coin. Any change that creates significant additional added value or significantly
reduced costs could in principle be turned to competitive advantage. As we have
already noted, if such advantage could be exploited and sustained, the gains in
profitability could be disproportionately great because existing margins are so
low.
Even
from this simple historical analysis of performance and existing competition,
we can deduce that there is both necessity and attraction for change in our
industry, notwithstanding the perceived need for change described in the
introduction. But before we can talk about change at FW, we need to know a
little more about the organisation itself.
THE
ORGANISATION
In
order to characterise the organisation it is appropriate to have an
organisational model as a framework. Many writers have presented models of
organisations and clearly these vary depending on the writer’s original
objectives. In the most abstract sense all represent the organisation as an
"interactive open system". Interactive, in the sense that the
constituent elements of the organisation interact with one another; open, in
the sense that these elements also interact with the external environment; and
systems, in the sense that the elements and interactions cannot be treated in
isolation from one another.
The
simplest descriptions, after Leavitt (37), involve four elements: - OBJECTIVES,
PEOPLE, TECHNOLOGY, and STRUCTURE. As well as the external ENVIRONMENT, there
is the more intangible aspect of the internal environment that we might call
the CULTURE of the organisation, or what the Mckinsey model might call SHARED
VALUES and STYLE (48).
To move
from the abstract to the specific, it is necessary to describe some of these
features explicitly in relation to FW.
OBJECTIVES
OF THE FW ORGANISATION
In the
preceding sections I have already described in broad terms the purpose of an
E&C contractor and possible generic strategies for FW. We also noted a
number of business objectives in discussing recent performance above. I do not
intend to say anything more specific here, about FW's actual strategic
objectives.
STRUCTURE
OF THE FW ORGANISATION
Appendix
B includes outline organisation charts for FW Corporation, the Engineering and
Construction Group and FW Energy Limited. A management organisation chart is
included for Process Plants Division, the process plants E&C contracting
operation of FWEL. Also included is a typical project organisation chart.
With
operations organised as projects the organisation structure is quite naturally
a matrix form. Most individuals in the organisation find themselves reporting
to a hierarchy of project management as well as line management. In fact the
apparent hierarchy facing the individual can seem very complex. Within the
project there may be Discipline Leaders, Area Engineers, Project Engineers,
Project Engineering Manager, Project Manager and Project Director, as well as
other functional coordinators. The line management hierarchy includes levels of
seniority and status as well as Discipline Principals, Section Supervisors,
Discipline Chiefs, Group Managers and Divisional Directors.
Delegation
of recruitment, appraisal and technical management functions by line management
can further confuse this picture, but in practice the real hierarchy (33), with
hire, fire, reward and spending authority is rarely more than three levels.
In
recent years there was an attempt to flatten the engineering line management
hierarchy by removing a further level. This was however reversed due to
problems with issues of status and career development paths, which had not been
adequately addressed in the attempt.
The
structure is in fact an extreme form of matrix, largely consisting as it does,
of task forces, but where line management retains technical management and back-up
responsibilities for staff on projects. The organisation therefore also
experiences the normal matrix conflicts with competing claims for resources
between one project and another and between projects and corporate aims. Other
inconsistencies are apparent between project and corporate responsibility and
authority. For example, as an authorised signatory on a project an individual
may be authorising specifications and recommendations representing millions of
dollars worth of work, whilst that individual's line manager may have
negligible corporate spending authority.
PEOPLE
IN THE FW ORGANISATION
FW's
business is a "knowledge business" (26). It may be easy rhetoric to
say so, but clearly the main assets of an E&C contractor are its personnel,
their expertise, the systems and procedures they operate and the electronic and
paper "deliverables" they are able to generate.
Appendix
C contains a summary profile of the 1300 staff of FWEL Process Plants, the
operating division of FWEL. An additional significant proportion of employees,
typically around 30%, comprises temporary agency staff, particulary employed in
"production" departments delivering designs and drawings.
The
majority of staff in most departments have specific technical and professional
qualifications or the equivalent in terms of experience. The majority
therefore, whether formally affiliated to professional institutions or not,
behave as professionals with much that that entails. Positive examples would
include peer group influence on health and safety responsibilities or on
contractual codes of ethics, but there can also be negative aspects concerning
demarcations of responsibility, verging on restrictive practices.
TECHNOLOGY
IN THE FW ORGANISATION
The
technological resources of FWEL's operation fall into three broad areas.
-
Process Technologies.
- Plant
Design and Construction Technologies
-
Project Management Technologies
PROCESS
TECHNOLOGIES
This
area of technology involves expertise in the chemical engineering and physics
of the processes involved in the plants themselves. It is applied plant
functional definition, to the original specification of energy and mass
balances, pressures, temperatures, volumes and compositions of the processes,
to their control philosophies and to the ultimate commissioning and operating
procedures.
In
certain sectors of the core business, eg specific oil refinery process units,
such in house technology generates original process designs from basic concept.
In other areas the expertise is needed to extract and interpret process designs
from client/operators, process licensors and process package suppliers.
The
products of this technology within the operation are information deliverables,
paper or electronic, and in the commissioning phase can include direct
supervision and hands-on services.
DESIGN
AND CONSTRUCTION TECHNOLOGIES
These
are the technologies associated with the methods and processes of design,
engineering, construction and testing of process plant hardware and systems. This
ranges from basic civil engineering works, through a whole spectrum of
mechanical and electrical disciplines to control systems software engineering.
Most of the physical and systems design employs Computer Aided Design and
drafting technologies, and increasingly relies on three-dimensional (3D CAD)
modelling techniques.
Again
the bulk of the direct product of this technology within the operation is
information, whether delivered in electronic or paper form.
A large
part of the operation is concerned with coordination and interpretation of
technical data exchanged between different engineering and design disciplines
and between the project and specialist suppliers of equipment and systems.
The
same range of technologies and expertise are also brought to bear on the
surveillance, technical supervision, and inspection of manufacture,
construction and testing of plant at suppliers works and construction sites.
PROJECT
MANAGEMENT TECHNOLOGIES
As a
contractor, as opposed to a manufacturer or operator of process plants, the key
area of FWEL's technology is in project management. As in any other field of
project management, this expertise is concerned with the planning,
implementation and control of activities and resources with defined objectives
of cost, time and quality.
This
expertise is not confined to Project Managers, Project Engineers or others with
specific project control functions, but is inextricably part of the technical
coordination activities described above, and is bound up in other purchasing,
sub-contracting and logistical functions.
As well
as the aggregate experience and knowledge of individuals, such proprietary
expertise and systems are captured in a significant body of "Contract
Execution Procedures".
CULTURE
OF THE FW ORGANISATION
Of the
component parts of the organisation, its culture is one of the least tangible
and most difficult to describe objectively. Culture is a measure of the style
and personality of the organisation, which affect the natural patterns of
behaviour within it, but in ways that are taken for granted.
Handy
(30) categorises culture according to the predominant patterns of organisation
in the operation; Power, Role, Task and Person cultures. On these axes, FWEL is
predominantly a role culture, as witnessed by the range of functional titles in
appendix C. Whilst, no doubt, few individuals refer to their job descriptions,
there are few who do not recognise demarcations around their job function and
many who would react defensively if others transgressed. I believe even new
employees quickly sense such demarcations long before they appreciate their
subtle details.
Such a
role culture is moderated only on the smaller, more close knit, project task
forces or proposal teams, who can develop a task culture, with all hands on
deck to achieve specific milestones. A strong role culture is typical of large
bureaucratic organisations and is ideal only in the most stable of
environments.
Deal
and Kennedy (22) characterise cultures according to the nature and potency of heroes,
rituals and anecdotes that exemplify the culture and underpin its beliefs and
values. In order for such informal symbolic features to represent an asset, it
is argued that they need to be common across the organisation and consistent
with formally stated aims.
Employees’
perceptions of the company are also indicators of the strength and direction of
its culture. Some aspects of this are revealed by the staff survey analysed
later in chapter 4, but an earlier survey of corporate image by Paul Peters
(45) indicated some important themes. For example:
The
dominant perceptions of the company's personality, according to its staff were
successful, good quality, reliable and traditional, but with low ratings of
dynamism, innovation and flexibility. When asked openly to identify FW's good
points, technical quality and reliability recur.
The
great majority of staff also perceived that neither themselves nor the company
as a whole had sufficient vision of its goals and direction. When invited to
identify bad points, inflexibility, bureaucracy and lack of innovation recur,
but so also do perceived internal problems with listening and communication.
Again when invited to identify areas for improvement, most of the previous good
and bad points recur, but so do issues of commitment, involvement, belonging
and motivation.
Another
later survey (65) of 80 staff members of one particular large department, was
concerned with their perceptions of team leaders and managers within that
department and with those leaders views of their own styles. Whilst there was
clearly a large range of perceptions of individuals, the average ratings
reflect the inherent leadership style or culture in the organisation. This
yielded extremely low ratings concerning the extent to which management inspire
any vision for the future or the extent to which they tend to question or
effectively challenge the established practices and processes. The ratings were
so low as to place them in the bottom 15 to 20% of any management population
sampled.
In
summary, there is a strong quality image, but with a traditional, reliable,
bureaucratic theme running through FW's culture. The fact that there is no
strong vision of direction and goals means that we must assume that any
informal heroes, rituals and anecdotes are unlikely to be common and consistent
across the organisation, or consistent with any formal goals. Whilst the
traditional quality culture is strong and could be considered positive in the
appropriate circumstances, it is unlikely to be seen as positive when we
consider future change and flexibility.
THE
FASHION
As well
as an interest in the specific needs and opportunities for change within FW,
the introduction also noted that there has been a recent fashionable focus on
the issues of change and flexibility. The purpose of this section is to look at
some of the issues in the headlines and to identify their relevance to FW, and
also to identify the extent to which such issues are already established
management themes.
The
fashion for change and flexibility is apparent not only in the popular
management literature, but also in a wide range of management texts, current
business press and trade press. Several of the references in the bibliography,
not listed here explicitly, serve to demonstrate this. The fashionable aspects
have been linked particularly to an overriding perception that factors
affecting business internally and environmentally are changing:
a. increasingly rapidly
b. in increasingly large steps
c. in disjointed and less
predictable ways
The
general implication is that such change will be a constant part of business
life and that in order to handle it, organisations themselves must also change.
One
only has to sample the language of the titles, subtitles and headings being
used by recent popular management authors to get a flavour of current thinking:
"World
turned upside-down" "Chaos" "Change is the only
constant" to quote Peters (46).
"The
age of unreason" "Change is not what it used to be"
"Catastrophe theory" "Discontinuous upside-down thinking"
to quote Handy (29).
"Riding
the Whirlwind" to quote Benton (9).
"Cacophony"
"Revolution" "Discord" "Creative destruction" to
quote Kanter (35) quoting Marx and Schumpeter (60).
"Waves
of change" "Turbulent world" "Fracture lines"
"Outside-in management" to quote Morgan (42).
The
language may seem out of place in business organisations, but can these, and a
dozen other gurus, all be wrong? There is no suggestion that they are wrong,
but the point is what is actually new ? It is after all, only a small mental
leap;
from -
Chaos, Discord, and Unreason,
to - Uncertainty, Paradox, and Irrationality.
In the
context of business management and management in general, these are not new
fashions, but established themes featured in a wealth of literature.
UNCERTAINTY
Uncertainty,
is the reason why managers, or anyone else for that matter, need to make
decisions. Without it, decisions would make themselves. Without uncertainty,
much of the science of operations management and quantitative analysis is
redundant.
PARADOX
Paradox,
the fact that possible outcomes may not only be competing, but may also be
mutually exclusive, is one reason why management decision making is much more
than an analytical science. Many paradoxes arise in decisions which may have
both long and short term outcomes, but there are many other classic examples:
Centralisation vs De-centralisation
Specialisation vs Integration
Control vs Discretion and Empowerment
The
"competing values model" of organisational effectiveness presented by
Quinn and Rohrbaugh (57) summarises a number of paradoxical issues which need
to be balanced by Management. See figure 3.1.
Figure
3.1 -
The Competing Values Model (57)
IRRATIONALITY
Irrationality,
as an issue for management consideration, is one manifestation of paradox.
Brunsson's
work on decision making (11)(12) links "Decision rationality" with
"Action irrationality", the point being that decisions made by the
most rational analysis of all available data are unlikely to be those executed
most effectively. Which is not to say that human decision-making behaviour
defies logic, more that individual actions depend on individually perceived
logic.
The
decision making process is an important determinant of how effectively a
decision will be implemented. Furthermore, implementing a decision is by
definition, making a change; the action taken changes the situation that would
exist in the absence of the action. The issues of rationality, decision-making
and the management of change are closely linked.
CONSTANT
CHANGE
Another
implication of the fashionable focus on change has been the fact that it will
be ever present, but this constancy of change is not a new theme either. As
interactive open systems, "business organisations are never static,
something about them is always changing" (21). At any time, changes are
occurring in the people, the technologies, the structure, the objectives and so
on. Changes in culture perhaps occur most slowly, and changes in environment
least predictably, but changes in any of these elements interact with one another
and, in any event, include both planned and unexpected aspects.
To note
that change is constant is not to suggest that it is continuous or uniform.
Ever since Schumpeter (60) in 1911 and Kondratiev (36) in 1925, observed trends
of recession and boom in macro-economic activity, the pace and direction of
change has been seen to be cyclical. Schumpeter and others linked such cycles
to underlying technology changes, and even now economists agree (7) that the
growth phase of the business cycle is driven predominantly by advances in
technology. Most recently, Freeman and Perez (27) have characterised these
macro-cycles, or Kondratiev waves, as paradigm shifts from one
"Techno-Economic Paradigm", or TEP, to another.
Whilst
at this macro-economic level these cycles may appear long and gradual, it is
quite reasonable to predict sudden transformations for individual industries
and businesses. A firm may be experiencing incremental changes in some aspect
of its operation which are part of the emergent TEP. When a critical mass of
changes has occurred in the industry, the existing status quo and
decision-making norms can be undermined to a point where the industry finds
itself at a cusp in its development. Subsequent change can be particularly
disruptive and unpredictable, as the whole structure of the industry is
transformed into the new TEP. This ongoing cycle of change allows current gurus
to predict the unpredictable, and draw on the language of catastrophe theory
and the science of chaos.
The
upswing of K5, the fifth Kondratiev wave, into the information and
communications TEP, might in itself be enough to predict a period of uncertain
change. However, as much of the current change literature reminds us, we are at
the same time also experiencing several other unconnected, and potentially
far-reaching, changes in our environment. For example, shifts in population
demographics; globalisation of competition; economic union in the EC; social
and political shifts in the disintegration of eastern bloc countries; a third
world debt crisis; social and political pressures increasing the importance of
ecological issues and alternative technologies. Unpredictable or not, a number
of these factors are
worth
discussing in relation to FW.
GLOBAL
COMPETITION
Like many
of our multinational clients, we operate and face competition globally.
Currently FWEL are very active in Southeast Asia and Indonesia, but the
possibility of counter competition is real. Already, for some years, the
Japanese are the main competition in these local markets and in other markets
such as the Middle East and Africa. How long will it be before the Japanese
compete seriously in markets nearer to home? What significance should we attach
to the Japanese contractor managing a construction site half a mile from Foster
Wheeler House, our main office? How long before we must take seriously threats
from players in Korea, Malaysia, India and other recently developed countries?
Will these nations have the same human resource limitations (54)? Are our traditional
clients not also facing similar competition in their own markets?
Like
many industries before, the existing Far East competition has acquired a
cut-price and ruthless image contractually. If we pursue the strategy of
targetting higher price, higher added value, niches in the market, might we one
day look back on an irretrievable sector retreat?
INFORMATION
TECHNOLOGY
We have
already noted that the human resource is the key resource and an important
growth limiting resource for an E&C contractor. We have also noted that the
business is information intensive, a "knowledge business" (26).
Clearly information technology, in all its guises, has already made major
inroads into our operation and those of our clients. The theoretical technical
possibilities for IT to further increase efficiencies and add value are
virtually boundless. Unfortunately, or perhaps fortunately, the limitations
remain human, but solving them may keep us ahead of those players with less
limited human resources.
For
example, some of the possibilities could have a major integrative effect on the
businesses of clients, contractor and suppliers. It is possible to envisage, if
not yet realise, major changes in the structure of the industry and the nature
of our business operation. As information and communications technologies are
central to the emergent TEP we might also expect IT changes quite unrelated to
our existing value chain to impinge on our operating environment. Again it is
not relevant to speculate on the detail of such possibilities here, merely to
note them and their significant potential consequences.
GREEN
ENVIRONMENTAL PRESSURES
In
contrast to the march of hi-technologies, there is the march of alternative
technologies to consider, not that they are mutually exclusive. There are
fairly obvious opportunities for a process industries E&C contractor
created by legislative and other pressures to reduce pollution or emissions and
to recycle waste generally. We have benefitted already from such process
requirements as the demand for unleaded gasoline, low sulphur fuels generally
and the demand to make use of low-grade waste heat, or the demand to have
environmental impact assessments performed and so on.
The
other side of the story is the threat to various sectors of our clients'
businesses from green pressures and alternative technologies. The alternatives
may not be process industries.
CHANGE
AND FLEXIBILITY AS A STRATEGY
Apart
from having spawned new metaphors, clearly one new message in the rash of new
literature on this subject is in the degree of unpredictability in the speed,
magnitude and direction of changes in the 90's and beyond. It’s not difficult
to see that if the future is unpredictable, then flexibility is a good
strategy. The novelty is in the implied urgency.
Flexibility
has passive connotations, the straw bending with the wind. Whilst going with
the prevailing flow is a perfectly valid tactic in many an operational
situation, it is definitely not the basis of a business strategy. Not much
advantage being flexible, if the next gust of wind blows your field off the
map. Here we are concerned with proactive flexibility, adaptability and
learning. Morgan (42) talks of needing "proactive mindsets".
On the
other hand, if the future is so unpredictable, why bother to prepare for it?
Don't panic, it might never happen. Plus ca change, plus c'est la meme chose.
Peters (46) describes this hurdle as "facing up to the need for a
revolution". Handy's boiling frog metaphor (29) is already hard-boiled. As
Handy himself says, the more accurate metaphor concerns Spanish invaders as
seen by South American Indians. It is not a matter of not noticing the change
arriving, more a matter of not recognising the potential in its arrival, whilst
you still have time to take appropriate action. The boiled frog simply fails to
notice a very gradual change that is taking place.
The
potential in an externally triggered change can be either negative or positive;
threat or opportunity. If the future of change is so unpredictable and
disjointed as to be chaotic, hinging on catastrophes and fracture lines, then
being in a position to handle it is not simply a defensive posture against the
potential threat. It is being in a position to exploit the opportunities
arising. "Thriving on chaos" as Peters put it (46).
Taken
to its logical extreme, if you can thrive on chaos, you may be able to create
further advantage by creating a little chaos in the first place. Others (47)
have cited examples of chaos created in stock markets by the introduction of
"junk bonds". Another high risk example which comes to mind is
Malcolm MaClaren, new wave music impresario who operated under the slogan
"Cash from chaos" during 1977.
Both
examples might appear equally irrelevant to a process industries engineering
contractor. No self-respecting major existing player in a mature industry with
powerful buyers and risk-averse stockholders could contemplate anything so
radical as even admitting the existence of chaos, let alone a strategy to
deliberately engineer it. The significance of health and safety issues in this
industry further reinforces this risk-aversion.
But it
brings me, however, to a final point in this section on the need for, and
opportunities inherent in, preparing for future change.
Even if
future change turns out not to be as chaotic as the pundits would have us
believe, we must be open to unexpected and unconventional possibilities for
changing the shape of the industry; daring to be different. Like many writers
before me on the subject of the management of change, it seems fitting to quote
some words from George Bernard Shaw:
The reasonable man adapts himself to
the world.
The unreasonable man persists in
trying to adapt the world to himself.
Therefore, all progress depends on
the unreasonable man.
A MODEL
FOR CHANGE
The
previous chapter included the simple message that flexibility and innovation must
be an important part of FWEL's strategy for the future in a changing world,
whether strategic objectives are primarily growth, profitability or survival,
and whether the generic strategy is one of quality differentiation, cost
leadership or segment focus.
What we
would like to address now are those organisational attributes that confer the
appropriate form and degree of flexibility. The management of change and
flexibility however, involves all the elements and linkages of our model of the
organisation, and we could draw up lists of apparently desirable features
against each of them. In fact many of the authors I have so far referred to,
include their own prescriptions of such features.
I
choose to start this section with the "Organisational Learning"
metaphor of Argyris and Schon (5). I choose it simply because the model
developed has a form which I believe appeals to the engineering mind,
consisting as it does, of a series of activities and decisions linked in a flow
diagram with feedback loops. There is no intent however, to limit our thinking
to the perspective of the purely functionalist paradigm (15). Because it is
incomplete, we can only get so far with this model, but it leads us to some of
the missing elements.
SINGLE
LOOP LEARNING
The simplest
form of learning, organisational or otherwise, is single loop learning (5).
Refer figure 4.1. Picture it as a quality control, whereby an error is detected
and fed back to initiate corrective action as appropriate. Alternatively, Tichy
(62) uses the less structured example of learning to ride a bicycle for the
first time. Staying with our quality control example however, there is still a
range of appropriate corrective actions :
1.
Reject and repeat or recycle until the deliverable meets the required standard.
ie Change the deliverable.
2.
Accept the deliverable by relaxing the original quality standard. ie Change the
specification.
3.
Recycle the deliverable but modify the process to achieve the required
standard. ie Change the process.
Typically,
even in a simple case, any and all of the options might be considered, in any
order, before acting to correct the problem. However, in all three cases, the
considerations and actions all concern the original deliverable, its
specification and the process that produced it. This is the essence of single
loop learning.
Figure
4.1 -
Single Loop Learning Model (5)
DOUBLE
LOOP LEARNING
Figure
4.2 -
Double Loop Learning Model (5).
In
double loop learning, the essential difference is the additional level or loop
of enquiry into the original "defect". Refer figure 4.2. As well as
looking to correct the original error in the original deliverable, questions
raised might include:
1.
Are we producing the right deliverable?
2.
Are we going about it the right way?
3.
Is there conflict in what we are trying to achieve?
4.
Is this symptomatic of some other problem?
5.
Whilst we're thinking about it, is there some other opportunity we're
missing (internal or external)?
Furthermore,
the single and double loop considerations might also arise in the QC and
learning processes themselves, as well as those involved in the deliverable and
its processes. Argyris and Schon call this Deutero-learning. Learning about how
to learn more effectively from your learning experiences.
Having
started with a QC analogy for single loop learning, it is interesting at this
stage to note also the parallel between the concept of double loop learning and
a formal quality management program. As we shall see later, this is no
coincidence.
Argyris
and Schon admit that the distinction between single and double loop learning is
not necessarily particularly clear cut in a real organisation with complex
processes and deliverables whose quality standards rely more on fitness for
purpose than physical attributes.
The
point however is that single loop learning is not organisational learning. It
is hard to imagine an organisation without a basic quality control level of
learning, but the best you could hope to learn with this, is to do well what
you already do. It is the very antithesis of flexibility and could only be
considered satisfactory if you planned to "stick to the knitting"
(48) in a permanently stable world.
Organisational
learning must include the additional features of double loop learning and it
must be effective. Graphically and procedurally it is perfectly feasible to
describe mechanisms for generating feedback, analysing it and acting on
decisions made. By coincidence I was asked to draft just such a procedure for
FWEL (28) at about the same time I embarked on this project. Refer figure 4.3.
Figure 4.3 - A Double-Loop Learning
Scheme within FWEL (28).
BLOCKAGES
TO LEARNING
The
crucial point is that, in general;
SUCH SCHEMES DO NOT WORK AT ALL
EFFECTIVELY (4).
The
problem with such a mechanistic scheme of organisational learning is that it is
really only a description of how things might happen in some form of ideal
world. As Pettigrew and Whipp put it, these are only the "secondary
actions and mechanisms" for learning and change (50). It is our first
indication that the double loop model of organisational learning is by itself
an incomplete model of the management of change.
Typically,
the real world of organisations is full of inhibitors and blockages to learning
and change planned and implemented along these lines. Argyris (4) calls them
organisational defences. Recognising what these are and then either breaking
them down or going round them is the key to organisational learning.
Argyris
and Schon's work proceeds to categorise the various defensive effects as
"Budgetary Games", "Fancy Footwork", "Skilled
Unawareness" and "Skilled Incompetence". They also are able to
identify the points at which they arise in the learning loops, and are
consequently able to develop their systematic flowchart analogy to represent
many of the subsidiary distorting and counter-productive loops which can exist.
But this is still just a model of the real world, and as Quinn and Cameron put
it "incapable of capturing the buzzing, booming confusion [ of paradox ],
no matter how strongly our logical arrogance tries to convince us
otherwise" (56).
Remarkably
however, Argyris and Schon claimed a single root cause of most, if not all, the
blockages. They considered that nearly all individuals in nearly all [western]
organisations hold nearly the same model of organisational behaviour (5). This
"Model I Theory-in-use" as they call it could be largely summed up as
"avoidance of embarrassment to yourself and others you deal with".
Two points are worth drawing from this:
Firstly,
we have the term "theory-in-use". That is the issue concerns the way
people actually behave, not their "espoused theories", those rational
principles that individuals might claim govern the way they act.
Secondly,
the emphasis is entirely on underlying patterns of behaviour, in a word;
CULTURE. The important implication here is that any structural or systematic
blockages are either generated or preserved by such consistent patterns of
behaviour.
OVERCOMING
THE BLOCKAGES
We have
implicitly concluded that blockages to change and organisational learning in
the double loop model above are due to problems with culture. An alternative
statement of the problem is that culture is the missing element in this
mechanistic model of change.
More
recent models acknowledge culture as an essential element involved in change
processes. Dawson's model (21) includes culture in most of the processes of
change. Also, this model incorporates feedback links at each stage of the
process and acknowledges the unpredictable inputs possible at each stage. Refer
figure 4.4
Figure 4.4 - Dawson's model of
change processes (21).
Brocklehurst (10) presents a checklist of the elements of a model of change
which includes specific aspects of culture. It includes the need to recognise
the dominant decision making model in the organisation and to recognise the
political structure in terms of the distribution of power and unity of
interests across the organisation.
Carnall
(17) talks of establishing "conditions which encourage the emergence of
creative solutions ". On the subject of major strategic change, Pettigrew
and Whipp (50) talk of establishing "primary conditioning features"
needed to plan and implement change.
The
choice between breaking down or avoiding blockages to change is equivalent to
deciding to change the culture of the organisation or to modify existing change
processes to take account of existing culture and politics. The decision is
clearly contingent on the scope and nature of change under consideration and
the extent to which cultural blockages are expected to interfere with desired
outcomes.
A few
discrete changes can probably be handled whilst playing the necessary political
games, without risk of unplanned compromise in the outcome. A few discrete
cultural obstacles may demand "blockbusting" (2) or specific
additional actions to "overcome organisational defences" (4).
If the
history of change has been either unsuccessful, or unacceptably difficult and
inefficient, and general cultural problems are seen as the cause, then what may
be needed is to take a leaf from the book of the "unreasonable man"
and try to change the world. Make the cultural environment a little more ideal
for learning.
THE
OBJECTIVE
So far
we have talked in very general terms about some aspects of FWEL and some
aspects
of the management of change. We have also become focussed on issues of
culture.
We need now to generate data which is more specific to change at FWEL and
which
provides tangible information on which to base an analysis of a most intangible
issue.
A
survey of staff perceptions on the subject of change within FWEL was considered
a
practical
means of gathering the necessary data. The objective of performing the survey
was to
gain a wider general picture of how the company itself perceived the issues of
change and
change management, rather than relying on the writer's preconceptions. As
the
survey developed, it became possible also to consider how such perceptions
varied
across
groups within the company.
BACKGROUND
TO THE SURVEY
During
the study of the subject "Management of Change" on the MBA course,
reference
had
been made to Carnall's "Managing Change in Organisations" (7). In
syndicate
sessions,
several different checklists presented by Carnall had been used in conjunction
with
brainstorming and force-field analysis on case studies. These included :-
Measures of effectiveness matrix. (p73)
Functional analysis of effectiveness.
(pp76-81)
Organisational diagnosis. (pp89-91)
Motivating leadership potential. (p100)
Management development needs. (p102)
Readiness for change. (pp202-203)
Managing change. (pp204-205)
The
general conclusions of these exercises were that the techniques indicated
powerful
means
of identifying key issues for the management of change, although we had clearly
been
limited by the level of company specific data which could be generated within
such
syndicate
sessions.
As
presented by Carnall, the checklists are generally intended for use by a
consultant
engaged
in structured interviews or group sessions with the management team of a client
company.
I decided in connection with this project that several were suitable for use as
questionnaires
to be completed by a wider range of staff within FW. This decision
involves
"suspending disbelief" that the management issues embodied in the
questions
might
not be seen as meaningful by this wider audience.
THE
QUESTIONNAIRES
Two
questionnaire were generated from three of Carnall's checklists. Copies of both
are
included
in Appendix D.
Questionnaire
1, entitled "Change Audit" includes 33 statements and comprises two
of
Carnall's
checklists appended one after the other. Statements 1 to 15 are statements 1
to 15
from the "Readiness for Change" checklist. Statements 16 to 33 are
statements
1 to 18
from the "Managing Change" checklist.
Questionnaire
2, is entitled "Organisational Diagnosis" includes 40 statements and
consists
of Carnall's checklist of the same name.
A few
editorial changes were made to suit the questionnaire format for issue within
FWEL.
Since, however, it was intended to make use of Carnall's own groupings of
responses
according to the subject of each statement, such editorial changes were
minimised.
Consideration
was, in fact, given at this stage to more extensive modification to the
questionnaires
to tailor them more specifically towards the target population and the
project
objectives. It was recognised that this would have been a major exercise to
accomplish,
without introducing bias and preconceptions concerning the behaviour of
respondents.
This compromise has its down-side in limitations in the value of some of
the
data collected.
THE
FORM OF STATEMENTS AND GRADING OF RESPONSES
Each
questionnaire consists of a series of statements which prompt alternative
responses.
Both are closed, in the sense that respondents must select their response to
each
statement from those available rather than originating their own. The only open
responses
invited are to indicate any specific change which the respondent considered
relevant
in completing questionnaire 1, and to provide any additional general comments
at the
end of questionnaire 2. The two questionnaires are however, quite different in
form.
Questionnaire
2 ( Organisational Diagnosis ), consists of statements requiring response
on a
seven point scale from 1, representing total agreement, through 4, the neutral
response,
to 7, representing total disagreement. Not surprisingly, as the results show
later,
this form prompted very few null responses, and those few could reasonably be
interpreted
as the neutral response in the subsequent analysis. Not only does this scale
cover
all possible responses, but all the responses to each different statement
clearly lie
on the
same continuous scale. It is therefore a simple matter to evaluate and compare
responses
to individual and grouped statements in terms of average (mean) responses
and
their standard deviation or some other measure of variance.
Questionnaire
1 ( Change Audit ) on the other hand, has 4 individual multiple choice
responses
to each statement. Whilst no other responses are invited, alternative responses
are
conceivable as are multiple responses and a null response is an additional
alternative.
A null
response might indicate either indecision or simply that the statement or its
relevance
are not understood, none of which are necessarily equivalent to any of the
other
reponses. As we shall see later, alternative responses were forthcoming
The
other feature of questionnaire 2 is that the available responses are less
clearly graded
on a
continuous scale. For most, the first response (a) represents the ideal case
and the
other
three (b), (c) and (d) represent less ideal cases or different and
progressively more
difficult
problems. As already noted, alternative or null responses generally indicate
additional
problems. Whilst the above is generally true, there are a number of statements
concerned
with the extent to which possible problems are recognised, for example
statements
20, 31 and 33 which concern the pace, effort and stress associated with
implementation
of change. Depending on the actual circumstances and the role of the
respondent
in the change, a low perception of the issue might indicate either that the
issue
was not a problem or that it was a problem which went unrecognised or
underestimated.
These are quite different conclusions.
In
analysing the general response to questionnaire 1, responses (a), (b), (c) and
(d) were
in fact
interpreted as a range from 1 to 4, where 1 represented the ideal or least
problematic
case and 4 represented a problem area. For statements 20, 31 and 33, this
was
reversed, ie responses (a) to (d) were interpreted from 4 to 1 on this scale.
This is
equivalent
to assuming repondents experienced the change as end users, rather that as
implementers
of the change. In all cases, null and alternative responses were assigned
the
value 4 on this scale. This facilitated comparison of average responses to
individual
statements
and groups of statements with other statements or groups. For reasons noted
above,
however, this interpretation is imperfect and caution will be needed in drawing
conclusions.
Testing
the significance of any conclusions may require categorical non-parametric
tests
of
response distributions, and may require more information about the respondents
involvement
in a given change than the questionnaire was designed to collect.
THE
SURVEY SAMPLE
The
original intention had been to select a sufficiently large random sample to
represent
the
pattern of perception across the staff as a whole. In order to simplify its
administration,
the first limitation to this aim was to confine the survey to Process Plants
Division,
which falls entirely within the authority of the sponsoring director. The staff
population
of this operating division at the time of the survey was 1273. A detailed
breakdown
of the population is given in appendix C.
Establishing
the minimum necessary sample size requires some assumption concerning
the
range of responses and their likely variance. The decision to obtain data which
could
be
analysed meaningfully across various groupings within the population required
sufficiently
large samples within each group. The populations of pre-defined natural
groupings,
for example across ages, lengths of service and departments, varied widely,
some
being much smaller than others. This implied the need to optimise pre-defined
groupings
and group sample sizes as well as the overall sample size.
Whilst
such an exercise was theoretically possible, there were two practical expedient
reasons
why this was not done :-
Firstly,
the groups of interest are not clearly defined by the original scope and
objective
of the
project. Any useful information obtained concerning response variation across
groups
was effectively a bonus. It was not essential that they be pre-defined.
Secondly,
since the survey was to be conducted voluntarily via the internal mail system,
the
response sample was clearly not going to be the same as the target sample.
Apart
from
value in analysing the level and pattern of response, it was considered
wasteful to
expend
further effort pre-defining group samples.
QUANTIFYING
THE SAMPLE SIZE
In
order to draw conclusions about sample mean responses with any confidence,
minimum
sample sizes are needed. Looking at the questionnaires, with their four and
seven
point scales, the maximum standard deviations we might expect, for say an
entirely
uniform distribution of responses, are 1.1 and 2.0 respectively. Assuming a
more
normal
distribution is more likely, we might reasonably expect standard deviations
somewhere
less than 1 in questionnaire 1 and somewhere over 1 in questionnaire 2.
Assuming
on these scales we would like to obtain estimates of average (mean) responses
+/-
0.25 with 90% confidence, then the sample size required is given by :-
n = ( t.s / 0.25 )2
where s = sample standard deviation,
approx. = 1
and t = the t statistic, approx. =
1.7 for 90% CI
hence n = 46 approx.
Later
our analysis will involve responses to groups of questions, groups of 3 in
questionnaire
1 and groups of 5 in questionnnaire 2. Each repondent will therefore
provide
a sample of 3 or 5 data points on each issue analysed. This implies that the
sample
size required in terms of numbers of respondents could be as small as 10 or 15,
ignoring
any direct correlation between an individual's different responses to different
questions.
Assuming
a 50% response rate, then a target sample of 200 individuals will provide 100
responses.
This should provide sufficient flexibility to permit subdivision into 5 sample
groupings
of up to 20 each. The intention, therefore, was to target an overall sample of
around
200.
SELECTING
THE SAMPLE
A
database file representing the entire process plants division staff was
extracted from
the
company's "Perseus" personnel database system as a formatted ASCII
text file. For
subsequent
manipulation and sorting this file was imported into DBASE IV (R) and LOTUS
123 (R)
form. For each of the 1273 current staff, the extracted file included :-
EMPLOYEE NUMBER
NAME
DEPARTMENT CODE NUMBER
JOB-TITLE
COST CODE NUMBER
STAFF GRADE
SEX
AGE LAST BIRTHDAY
YEARS SERVICE COMPLETED
LOCATION
The
first action needed was to rationalise on those attributes which were of
interest. This
was
partly to make handling the data manageable and partly for reasons of
confidentiality.
Employee
number was discarded at the outset. Name and Location were retained in the
target
sample files for use only in addressing questionnaires to individuals, and are
not
included
in or linked to respondent files. The only unique identifiers in these files
are
sequential
file record numbers.
Sex,
age and years service were retained as attributes for subsequent sorting and
grouping
of the population, the target sample and the response samples.
Department,
title, cost code and staff grade required some rationalisation. Department
clearly
indicates the general area in which an individual works as does the title, but
it is
the
cost code which indicates the specific functional discipline. Unfortunately
there are
some 63
different cost codes represented in the population and their primary function
is
to
allocate staff costs. It was considered impractical to use this cost code for
grouping
and
sorting the sample during analysis for this project, however cost code remains
as an
attribute
within the target and response samples. Department is the only indication of
functional
area of work used here.
In
order to have some indication of an individual's level in the organisation in
terms of
management
responsibility and authority, title and staff grade are relevant. Staff grades
are
actually an indication of wide overlapping salary bands, and the combinations
of title
and
staff grade are not applied uniformly or rigorously across all departments.
Furthermore
there are some 358 unique titles and 643 unique combinations of title and
grade
within the population of 1273 staff. Recognising their imperfection, staff
grades,
of
which there are 20, were selected as the only indicator of level in the
organisation.
This
left 5 useful attributes to be use for sorting and stratifying the population
and any
subsequent
samples :-
DEPARTMENT
STAFF GRADE
AGE
YEARS SERVICE
SEX
It was
theoretically possible, but not practically appropriate for reasons noted
earlier, to
stratify
the population on each of these bases before selecting samples uniformly
distributed
within each band on each axis. A simpler approach was adopted.
The
entire population was arranged alphabetically on employee surname and, starting
from
the randomly chosen third entry, every seventh candidate was selected. Having
removed
from this sample a number of anomalous entries with null attributes and zero
years
service completed, a sample of 165 remained.
Sorting
this sample according to the five attributes selected shows subjectively at
least
that
the sample includes a reasonably uniform proportion from each stratum. ( Refer
appendix
C ). The most apparent anomaly is the disproportionately small sample of grade
12 and
13 staff. No further attempt was made to reselect or adjust this sample before
proceeding.
Each
copy of the questionnaires issued was labelled with the five selected
attributes (and
cost
code) of the target individual. This allowed anonymity whilst permitting the
necessary
sorting of responses without any link back to the population and target sample
files.
GENERAL
LEVEL OF RESPONSE
Of the
165 individuals targetted, 90 returns or 55% had been received at the time of
the
analysis
described here. A further 7 individuals responded informally that they would
not
be
returning the questionnaires. Reasons given were too few years service to
comment,
long term
remoteness from corporate organisation on assignments, and no experience of
significant
changes on which to base comment. Two other individuals queried issues of
confidentiality
and these may or may not be included in the returns above.
A full
summary and breakdown of the responses are included in appendix S. This chapter
describes
how the response data was handled and analyses the overall response to the
questionnaires,
including individual and grouped questions. The following chapter
considers
the response of various sample groups within the overall reponse.
HANDLING
AND PRESENTATION OF RESPONSE DATA
For
each returned questionnaire the data logged included :
-
Details of the respondent as defined earlier.
-
Their response to each individual statement, including null
or alternative comments.
-
The relevant change indicated in questionnaire 1.
-
Any additional comments made specifically after
questionnaire 2 or incidentally
elswhere.
The
aggregate response to each questionnaire statement is summarised and presented
as a
histogram with tabulated totals, and as the sample mean and standard deviation
values
evaluated on the scales discussed above. ( Figures S6 and S7, in Appendix S,
present
these summaries for questionnaires 1 and 2.)
In
analysing and comparing responses later, the sample means are used extensively
for
rating
and ranking problem levels perceived in relation to FWEL. For questionnaire 1
this
is a
rating on the scale of 1 to 4 from least to most problematic. For qustionnaire
2 this
is a
rating on the scale from 1 to 7, ranging from least to most problematic, or
most to
least
agreed with, depending on the context. For shorthand the phrase "... the
statement,
[or
group of statements], whose mean response yielded the most [least] problematic
perception
..." will simply become "... the most [least] problematic statement
[or
response,
or issue] ..." throughout the following analysis.
Figure
S8 summarises the changes indicated in response to questionnaire 1.
Figure
S9 summarises the supplementary comments received.
OVERALL
REPONSES TO THE QUESTIONNAIRES
On the
whole responses were generally positive, that is grouped closer to the least
problematic
end of the scales defind, and relatively few extreme individual responses
were
indicated. A significant number of additional comments and remarks were also
received.
I concluded that the questionnaires had been completed thoughtfully and that
there
was no reason to doubt the validity of responses.
With a
survey of this nature, requiring voluntary effort by each respondent, we might
expect
a positively biased response in relation to the whole staff population.
Of the
four respondents who identified no relevant change on which to base
consideration
of questionnaire 1, all four left that questionnaire entirely unanswered, and
one
also ignored the whole of questionnaire 2. Their null responses are included in
average
responses on the basis described above along with null responses to other
individual
statements.
OVERALL
RESPONSES TO INDIVIDUAL STATEMENTS
The
least and most problematic statements from each questionnaire are tabulated in
figure
S10.
QUESTIONNAIRE
1
The
most problematic individual response, No.27, indicates that on the whole staff
perceived
that changes implemented had included only problems and no specific
incentives
for users in their implementation. Contrasting this with two of the least
problematic
responses, No.s 29 and 30, indicates that on the whole the effects of
changes
were perceived to be measurable even if most perceived that any benefits did
not
accrue to them.
Two of
the next most problematic responses, No.s 22 and 23, reveal the perception that
inadequate
emphasis was given to training in connection with changes. This contrasts
with
two of the least problematic reponses, No.s 10 and 11, whereby staff perceived
senior
management enthusiasm for change and the committment of resources to
implementing
change. Also, two more of the least problematic responses, No.s 1 and 3,
indicate
that changes made have generally been perceived as successful.
The
implications so far are that change has generally been initiated and
implemented by
senior
management decree rather than by wider committment to it. Consistent with this
is
response No. 26, indicating a perceived problem with the level of discussion
between
staff
and management generally in connection with change.
Another
of the least problematic responses in questionnaire 1 was that to statement
No.12,
where most staff perceived performance appraisal as important to change
management.
Interestingly, a number of the qualified responses to this statement
included
; "What has this to do with change ?" and "[It's important] only
if it's done
properly."
This gives an indication that whilst performance appraisal is perceived as
important
it is not necessarily done well, certainly not in relation to change. I suspect
a
number
of others who agreed with its importance may have left such qualifications
unsaid.
This point is significant as we move on to look at questionnaire 2 on the same
basis.
OVERALL
RESPONSES TO INDIVIDUAL STATEMENTS - QUESTIONNAIRE 2
Two of
the most problematic responses to questionnaire 2, No.s 22 and 36, indicate
that
on the
whole, performance appraisal is seen as infrequent and arbitrary. Several
writers
have
indicated the need to include appraisal of change performance in general
performance
appraisal. I believe this is supported by the general perception within FW.
Furthermore,
the survey seems to indicate a significant performance gap between the
perceived
importance of appraisal and the experience of appraisal. Addressing this issue
clearly
holds significant potential for improving change management at FW.
Another
problematic statement is No.12, which indicates that in general most staff
consider
that they deserve greater financial remuneration. Whilst this is perhaps
predictable
behaviour in response to the statement posed, it does indicate some potential
for
linking appraisal of change performance to valued financial incentives.
Significantly
however,
this question also yielded the flattest response, with a standard deviation of
1.68
compared to around 1.0 to 1.3 for most other responses and 2.0 for a
theoretically
uniform
response. This clearly indicates, if further evidence were needed, that
financial
rewards
are not the only valued motivator. This does not however undermine the implied
potential
in performance related rewards.
On the
subject of motivation, several of those statements most agreed with, indicate
the
perception
that individuals and teams are motivated to achieve good performance. No.17
specifically
suggests that individuals consider the work itself motivating. No.s 16, 27,
37 and
40 all confirm the impression of motivation, but give no indication of the
source
of
motivation.
Whilst
on the whole individuals find the work motivating, there is strong disagreement
with
statement No.32 that all tasks are ncessary and effective. Not surprisingly
therefore,
in
response to statement No.23, there is the general perception that individuals
would
like to
make changes to their work, coupled with the reassuring perception, in response
No.31,
that the organisation possesses the capacity to change.
One
area where individual perceptions indicate no problem is in relationships with
people
around
them, with statements No.11 and 19 being the two most agreed with.
There
is an interesting difference between the response to statement No.1 "I
understand
the
objectives of FW", which was one of the most agreed with, and statement
No.25
"FW's
priorities are understood by its employees", which was one of the most
disagreed
with.
This looks like a behavioural issue associated with the questionnaire itself,
and the
wording
of statement No.1. So far as an individual knows FW's objectives, it is
difficult
to
admit not understanding them, even anonymously, and even recognising the
different
view of
others. I note that when I trial completed the questionnaire myself, I too
exhibited
this behaviour.
Alternatively,
if we accept individuals' objectivity in their response, the general positive
bias in
the overall response may mean that, in general, those who responded do indeed
identify
more with corporate aims than those who did not. Either way, my conclusion
here is
to suspect that FW's priorities and objectives, other than current project
objectives,
are not generally well understood.
Finally,
in this section on responses to individual statements in questionnaire 2, the
single
most
problematic statement, No.28, and two of the others most disagreed with, No.s
14
and 30,
are management criticisms.
The
perception that "encouragement and recognition are not given for all tasks
at FW"
is a
concern for motivation whose only conceivable consolation is the possibility
that
inclusion
of the word "all" made it subtly too extreme to attract general
agreement. The
other
two problem statements criticise "senior management style" as
innefective and
unhelpful,
and leadership of "the management team" as innefective and
uninspiring. A
number
of the general comments received, presented in appendix H, also reinforce this
perception
One
concern with these criticisms based on perception is to establish who is being
criticised.
The lack of encouragement and recognition may be aimed at colleagues and
peers
as well as immediate supervisors and higher management, although we should bear
in mind
that most perceived good relations with those around them.
I would
surmise that most individuals include management higher than their immediate
supervisor
when referring to senior management and the management team. This is
borne
out by the contrast with statement No.s 5, 6 and 38 which drew consistently
more
favourable
responses in relation to "my boss" on similar issues. Clearly this
issue can be
analysed
further later when looking at diferences in response across different levels in
the
organisation.
A
second problem here is to decide if it matters whether such criticisms are
based on real
or
perceived problems. Clearly it does matter, in the sense that a different
problem may
demand
a different solution, but either way a problem is indicated. If the criticisms
are
not
founded in real objective issues of management style, then the problem may be a
perception
of "us and them", whoever the management team is perceived to be.
Again,
if not,
we will need to consider what they are based on.
OVERALL
ANALYSIS OF GROUPED STATEMENTS
We have
analysed the overall response to individual questionnaire statements only where
their
average ratings were the more extreme. There nevertheless appear to be some
themes
emerging concerning problem areas. In order to take account of responses to all
statements
not just the most extreme, it is necessary to group the responses. Carnall,
on
whose checklists the questionnaires are based,
proposes a grouping applicable to
each
questionnaire based on the issues reflected in each statement. As we shall see
several
of the themes already identified recur in these groupings.
THE
ISSUES IN QUESTIONNAIRE 1
According
to Carnall, for questionnaire 1, concerned specifically with planning and
managing
changes, statements represent groups relevant to the folllowing issues :-
TRACK RECORD ( No.s 1, 2 and 3 ). Has
past change been successful,
resisted, misunderstood, met with caution
?
EXPECTATIONS ( No.s 4, 5 and 6 ). Does
everyone know what to expect
from change, are the objectives clear ?
OWNERSHIP ( No.s 7, 8 and 9 ). Who
identifies with the change; staff,
management or is it just procedure ?
TOP SUPPORT ( No.s 10, 11 and 12 ). Are
top management supportive,
do their actions match the perception ?
ACCEPTABILITY ( No.s 13, 14 and 15 ). Is
there a fit between current
work, future aims and planned change ?
PLANNING ( No.s 16, 17 and 18 ). Are change
plans clear and achievable,
are responsibilities well defined ?
INTEGRATION ( No.s 19, 20 and 21 ). Will
the scope and pace of change
be accommodated by the organisation ?
TRAINING ( No.s 22, 23 and 24 ). Is
appropriate training provided, is it
correctly targetted ?
COMMITTMENT ( No.s 25, 26 and 27 ). Will
the manner of
implementation create ownership and
committment ?
FEEDBACK ( No.s 28, 29 and 30 ). If the
benefits will accrue slowly or to
others, will users see them ?
STRESS ( No.s 31, 32 and 33 ). Is it
recognised, how will problems be
handled in the "coping cycle" ?
THE
ISSUES IN QUESTIONNAIRE 2
For
questionnaire 2, concerned with organisational performance as a whole, Carnall
arranges
responses to the statements into 8 groups of 5 as follows :-
KEY TASKS ( No.s 1, 9, 17, 25 and 33 ).
Are the basic objectives defined
and work tasks meaningful ?
STRUCTURE ( No.s 2, 10, 18, 26 and 34 ).
Are there problems with the
organisation and structure of tasks ?
RELATIONSHIPS ( No.s 3, 11, 19, 27 and 36
). Are there problems with
the way staff relate to one another ?
MOTIVATION ( No.s 4, 12, 20, 28 and 36 ).
Are there problems with
encouragement, recognition and reward ?
SUPPORT ( No.s 5, 13, 21, 29 and 37
). Are there problems with
organisational support ?
LEADERSHIP ( No.s 6, 14, 22, 30 and 38 ).
Are there problems with
management style and leadership ?
ATTITUDE ( No.s 7, 15, 23, 31 and 39 ).
Do staff have an attitude
problem towards change ?
PERFORMANCE ( No.s 8, 16, 24, 32 and 40
). Are there problems with
performance and achievement ?
ANALYSIS
OF GROUPED RESPONSES
On the
basis of the above groupings the mean responses to each group of statements
in both
questionnaires are presented in figure S11. These are ranked in order from the
most to
least problematic issues as perceived by the aggregate sample. Perhaps not
unexpectedly,
the most and least problematic groups of statements include several of the
most
and least problematic individual responses.
In
connection with change specifically, the same issues arise in questionnaire 1
as
perceived
problems. For example ;
The two
most problematic issues concern TRAINING in connection with change and
implementation
of changes in ways likely to achieve COMMITTMENT. Again also, this
is
contrasted with the fact that TOP SUPPORT for changes from management is not in
doubt
and must, in part at least, be responsible for the perceived success in
implementing
specific
changes.
The
next most problematic issues were perceived to be INTEGRATION and
ACCEPTABILITY.
These indicate possible problems with changes not being perceived to
fit
with wider goals and objectives or previously defined tasks, or problems with
introducing
specific changes too fast on too wide a scale.
Three
of the least problematic issues were perceived to be the TRACK RECORD in
actually
implementing changes, the generation of FEEDBACK from changes, and the
PLANNING
of changes. The success in actually planning and implementing specific
changes
should be expected in an organisation whose core operation is project
management.
On the
whole questionnaire 1 did not exhibit a wide spread of ratings for the mean
response
to grouped questions. Such trends as are indicated however, appear consistent
with
the analysis of the more extreme responses.
Looking
at the mean grouped responses for questionnaire 2, also presented in figure
S11,
we see
again the issues of MOTIVATION, LEADERSHIP and organisational SUPPORT
perceived
as most problematic. Conversely, Individuals see the definition of KEY TASKS
and
objectives, the general ATTITUDE towards change and their RELATIONSHIPS with
others
as least problematic.
Generally
again, the analysis of grouped statements reinforces the analysis of individual
statements
without highlighting any new issues and it is now possible to summarise the
overall
response to the survey :
SUMMARY
OF THE OVERALL SAMPLE RESPONSE ANALYSIS
Having
analysed the overall sample mean responses to individual and grouped
statements,
we are in a position to summarise the analysis of ovearll staff perceptions.
A
number of themes and key issues have arisen, several of which are common to
both
questionnaires.
In summary :
* Planning and implementation of
identifiable changes in the recent past
are perceived to have been successful.
* The support from top management for
such specific changes is
perceived to have been enthusiastic and
this has contributed to such
success.
* There is perceived to be an underlying
recognition of the need for further
change and an implicit desire for
involvement in it.
* Problems are perceived concerning
involvement with and committment
to changes experienced, possibly related
to inappropriate use of training
and feedback, though feedback in itself
is not perceived as a problem.
* The style of management and leadership
is perceived to be discouraging,
which conflicts with management
enthusiasm for specific changes and
which acts against the apparent positive
attitude to further change.
* Problems are perceived with motivation
generally and specifically with
incentives to generate change. There is
evidence to link this with
ineffective use of performance appraisal,
reward and recognition.
* There is a perception that corporate
goals, wider than immediate project
objectives, are not widely recognised.
ANALYSIS
OF REPONSES FROM DIFFERENT RESPONDENT SAMPLES
All the
previous analyses have been based on the mean responses from the overall
sample
of 90 respondents, looking first at individual questionnaire statements and
then
at
grouped statements relevant to particular issues. We can get information about
how
responses
vary for various groups within the sample by sorting according to the various
attributes
defined earlier for each respondent and calculating mean responses within each
sample
group.
There
is no specific requirement in the stated objectives to analyse particular
groups, but
any
significant response differences may warrant different conclusions and
recommendations
concerning that group. The main objectives here in analysing different
sample
groupings are firstly, to establish the extent to which the overall sample is
representative
of the overall population, and secondly, to establish the extent to which
the
overall mean responses reflect general perceptions or merely the average of
more
diverse
perceptions of different groups of the population.
THE
SELECTION OF SAMPLE GROUPINGS
The
overall sample responses were sorted according to each of the respondent
attributes
recorded
earlier and according to the change indicated in connection with questionnaire
1.
Against each of these axes, the sample was grouped into bands which were
contiguous
across the whole sample, and which maintained useful sample sizes within
each
band so far as practicable.
Analysis
of responses to individual statements was going to be impractical across
multiple
groupings and therefore all considerations of useful sample size were based on
subsequent
analysis of groups of three and five statements per issue. Using the
arguments
which led to the original overall sample size, the target was to select groups
of not
less than 15, although groups of 10 only could be considered useful in
analysing
responses
to questionnaire 2.
Because
of the limited objectives in analysing the group samples there was no intent to
establish
significant correlations between groupings on different axes, nor sub-groups
within
groups. In looking at responses from different smaller sample groups to
different
issues
it was useful to bear in mind the sample mean confidence intervals implicit in
the
data.
The analysis includes references where applicable to approximate estimates of
the
90%
confidence intervals related to the actual sample sizes and sample standard
deviations.
GROUPINGS
ACCORDING TO CHANGES INDICATED
Respondents
indicated relevant recent changes in response to questionnaire 1, the
change
audit. These are summarised in figure S8, and discussed below. An important
point
to bear in mind during the subsequent analysis is that the responses give us no
indication
of the individual's role in the change indicated, other than that they
experienced
it and thought it relevant to the survey.
Apart
from those 6 respondents who identified no relevant change, only 7 changes were
identified
by more than one respondent. The groupings of change indicated are as
follows:
CHANGE
INDICATED "SWIPE"
16
people referred to the introduction during the previous year of an electronic
swipe
card
system, as a combined replacement for security passes and manual clocking-in
cards
for all
employees. As far as individual users' activities are concerned , practical
effects
ofthis
change are limited to eliminating a few minutes effort each week manually
calculating
and reporting their hours attended at the office. The system automatically
generates
such records for management, and permits interested individuals to interrogate
their
own hours recorded so far. For supervisors and administrators, checking of
manually
completed
clock-cards is replaced with the task of checking and reconciling system error
reports.
CHANGE
INDICATED "DMS"
Interestingly,
the next most frequently indicated change reflects the other side of the
same
coin. 14 people indicated the introduction and upgrade of a project management
information
system. The Document or Deliverable Management System ( DMS ) was first
introduced
over four years prior to the survey and since then has been introduced onto
most
projects and has undergone a couple of upgrades. The system impinges on all
staff
involved
in project operations, who must individually allocate and report their hours
spent
against work breakdowns and subdivided activities
associated with deliverables within
the
DMS. Prior to introduction of this system, reporting of activities at levels
lower than
overall
contract and account codes was the exception rather than the rule. For line
managers,
project managers and supervisors, the DMS is one, if not the, key means of
planning
activities, allocating manpower resources and budgets and the monitoring and
controlling
subsequent progress. In some areas, the definition of tasks within the system
are being
linked to specific procedures and work instructions for quality management
purposes,
and to higher level planning and estimating activities. Like any powerful MIS,
its
value relies on detailed planning, reporting and forecasting by those involved
at the
individual
task level. This is the other main area where DMS impinges on the activities
of most
individuals in involved in project operations.
CHANGE
INDICATED "TQM"
9
respondents indicated as their subject change, the introduction during 1989 of a
Juran
based
Total Quality Management program. This has so far involved setting up of a
Quality
Council, several Quality Improvement and Action Teams and numerous Quality
Circles.
In part at least, its introduction stemmed from recognising its importance to
major
clients, but also from internal recognition of its potential for making
operational
improvements.
Having adopted TQM is almost certainly a marketing success, and in fact
much of
the language of TQM has become accepted curency throughout the company
and on
projects. It is quite normal to refer to "TQM facilitators",
"team building",
"internal
customers" and "opportunities" as opposed to problems. The jury
must remain
out
concerning the extent to which significant tangible benefits have accrued, but it
is
still
relatively early days to expect dramatic improvements. Despite frustration in
some
quarters,
there remains high level recognition that TQM not only holds enormous potential
for
change, but also that tangible benefits may need to be preceeded by less
tangible
cultural
changes. To some extent, the brief for this project stems implicitly from this
latter
point.
(With a
sample of only 9 groups of 3 or 5 statements, the 90% confidence interval for
sample
mean responses is estimated to be around +/- 0.33 on each of the scales
defined.)
CHANGE
INDICATED "LRQA"
Another
9 respondents selected another quality related change; accreditation of our
operation
by LLoyds Register according to BS 5750 Quality Systems. More so than with
TQM, this
was a directly market driven change. The organisations we were dealing with
and
important competitors were becoming accredited and there was a danger of this
becoming
a definite diasadvantage in the market place. FWEL has operated systems and
procedures
satisfying much of the intent of BS 5750 or ISO 9000 since before such
standards
existed. This quality image had in fact probably given FWEL certain competitive
advantage
prior to widespread accreditation. Individual involvement with this change
varied enormously.
Some were heavily involved in a major "facelift" given to all our
existing
contract execution procedures. Most if not all individuals will have been
exposed
to the
published revisions to these procedure. To a greater or lesser extent many have
been
involved in preparation for and participation in increased audit activities,
prior to
during
and since accreditation.
( The
same comment applies to the sample size as TQM above.)
CHANGE
INDICATED "PC/IT"
15
respondents indicated IT changes. This included 4, who referred to the
widespread
introduction
of Personal Computers (PC's) for general purpose use, whilst the remainder
indicated
11 different specific IT changes affecting their own areas of work. Only one
referred
to the widespread introduction of "PDS" 3D CAD modelling as the main
design
tool on
current projects. Only one referred to the recent introduction of, so called,
"intelligent
flowsheets" as a project engineering tool on some recent contracts.
OTHER
CHANGES INDICATED
Changes
indicated by the remaining 21 respondents are lumped together as the
"REST"
for
later analysis.
Of
these, 5 identified the adoption of an American Express (AMEX) based personal
expense
account system to replace the existing internal system.
3, all
from Project Engineering, identified the reorganisation which merged their
department
under the Engineering and Computer Aided Design department.
5
others identified structural changes; various separate group reorganisations
and one
personal
assignment change.
The
remaining 8 identified different procedural changes, such as the introduction
of
specific
new systems or practices into specific groups.
It is
relevant to note at this point the nature of the changes indicated as relevant
by more
than
one respondent. Three of the changes indicated are administrative or control
systems
( SWIPE, DMS and AMEX ), and two are quality management initiatives ( TQM
and
LRQA ), the other being a structural change. None are operating systems.
Clearly
we might expect a larger sample from the administrative changes simply because
they
directly affect most of the population. Whilst this finding does not in itself
indicate
a low
level of operational changes, it does nevertheless seem to indicate a lower
general
emphasis
on these as perceived by the staff population.
GROUPINGS
ACCORDING TO SEX ( Refer figure S3 )
Not
much mystery here about the groupings. In fact the response included 76 men and
14
women and hence these form the two groups analysed. This reflects a very
similar
response
rate between the sexes, 58% for women, 54% for men. The target sample was
also
very uniformly distributed according to the distribution of the sexes in the
population,
15% women and 85% men. The overall response sample analysed earlier is
therefore
very closely representative of the mix of sexes within the staff population.
GROUPINGS
ACCORDING TO STAFF GRADE ( Refer figure S2 )
With 20
different staff grades represented in the population and the target sample, the
response
sample includes widely ranging response rates and sample sizes for each
individual
grade.
Firstly,
consecutive grades were grouped to provide useful sample sizes as follows :
Grades 18, 19 and 20 formed a sample
of 11
Grade 17 formed a sample of 15
Grades 15 and 16 formed a sample of 21
Grades 12, 13 and 14 formed a sample
of 14
Grades 10 and 11 formed a sample of
18
The remaining grades 0 to 9 formed a
sample of 11
Even
having done this, the response rate and population proportions vary
significantly
between
groups. For example :
The
higher grades 17 to 20 had a higher response rate of 73% to 75% compared to 55%
overall,
whereas grades 12 to 14 and 0 to 9 yielded a lower response rate of 34% to
45%.
Whilst this is in itself of interest in terms of identifying the most positive
response
behaviour
amongst the higher grade staff, the effect on the representative nature of the
overall
response needs also to take into account the bias in the target sample.
As noted
earlier, grades 12 and 13 were already under represented in the target sample.
The net
result is that the overall response analysis presented earlier is biased
towards the
grade
18, 19 and 20 group, and under represents the 12 to 14 and 0 to 9 groups. We
need to
bear in mind also that staff grade is only an imperfect indicator of
organisational
level.
GROUPINGS
ACCORDING TO AGE ( Refer figure S4 )
Responses
were first grouped into age bands of useable sample sizes.
Those up to and including 25 years
of age last birthday
formed one group of 15.
Those 26 to 35 years formed a group
of 18.
Those 36 to 40 years formed a group
of 13.
Those 41 to 45 years formed a group
of 16.
Those 46 to 50 years formed a group
of 11.
Those 51 and over formed the
remaining group of 17.
The
response rate across the age groups was quite uniform, ranging from 49% to 59%
compared
to 55% overall, except for the 41 to 45 year band which yielded a 76%
response.
Taking into account the original bias in the target sample, the overal
population
was
uniformly representative of the population age bands, with a slight bias
towards
those
in the 36 to 45 year groups being over represented.
GROUPINGS
ACCORDING TO LENGTH OF SERVICE ( Refer figure S5 )
As with
the other groupings, the response sample was grouped into bands which
provided
useful sample sizes.
Those with 1 to 2 years service
completed formed the first
group of 25.
Those with 3 to 5 years service
formed a group of 12.
Those with 6 to 10 years service
formed a group of 22.
Those with 11 to 15 years service
formed a group of 16.
Those with 16 and over years formed
a group of 15.
There
was some variation in response rate; the 6 to 10 and the 16 and more year bands
yielded
69% and 65% responses compared to the overall rate of 55%.
The
overall response sample was uniformly representative of the population, except
for
a bias
towards the 6 to 10 year band being over represented. Because of a deliberate
bias in
the target sample, the response did not include those with less than one years
service
completed at the time of the survey.
GROUPINGS
ACCORDING TO DEPARTMENT ( Refer figure S1 )
Departments
do not fall into neat groupings, and several smaller individual departments
yielded
very small response samples. It was not generally possible to create artificial
groupings
of useful sample size, as was the case with other groupings. Those groups
analysed
are summarised as follows :
The Glasgow and Glasgow assigned
departments, 111 and
112, formed one small group of 8
responses.
The Process Engineering department,
152, yielded another
small sample group of 7 responses.
The Engineering and Computer Aided
Design department,
153, is the largest department and
yielded the largest
sample group of 38 responses.
The Materials Management department,
165, incorporating
purchasing, inspection and shipping
groups, provided a
useful sample group of 11 responses.
The Home Office and Field
Construction departments, 193
and 196, yielded another small
sample group of 5
responses.
The remainder formed a group of 21
responses.
Both
the Glasgow (111/112) and Construction (193/196) departments yielded below
average
response rates of 44% and 42% compared to 55% overall. Construction
departments
response rate as recorded is depressed by two of their target sample who
failed
to receive their questionnaires in time, whilst assigned to more obscure
locations.
Unfortunately,
Construction were also somewhat under represented in the randomly
selected
target sample. The low response from Glasgow may be connected with two
queries
of confidentiality originating from there.
The net
result is that the overall sample is clearly dominated by the largest
department;
Engineering
and CAD. The overall sample is in fact biased towards both this dept and to
Materials
Management department, whilst both Glasgow and Construction departments
are
under represented.
The
sample sizes of response from Glasgow, Process and Construction departments are
too small
to draw much significance from their mean responses.
ANALYSIS
OF RESPONSE FROM GROUP SAMPLES
For
each of the sample groups described above, mean responses were evaluated from
the
aggregate response to each defined group of statements relevant to a specific
issue,
in the
same way described earlier for the overall sample.
These
mean responses for all sample groups for all groups of statements are presented
in a
single table; figure S12. In this figure responses are tabulated within each
questionnaire
in the same ranking from most to least problematic issues derived from the
overall
analysis. By highlighting the two most and the two least problematic issues
according
to the perception of each sample group in this table, comparison between the
ranking
of issues according to each sample group and the overall sample is facilitated.
Several
alternative graphical representations of this data were investigated, involving
either
large numbers of individual histograms or fewer multivariate histograms. I
concluded
that none were any easier to interpret and compare across the groupings than
the
tabular form. Clearly if specific comparisons or correlations warrant further
analysis,
then
specific graphical presentations may prove more useful and the data remains
available
to generate these at a later date.
The
following analyses are therefore based on the data tabulated in figure S12.
GENERAL
OBSERVATIONS ON SAMPLE GROUP RESPONSES
The
first point to note is that the general rankings from most to least problematic
issues
according
to the perceptions of each sample group is much the same as the overall
sample.
The following are three examples of the extent to which this is true :
Firstly,
there are no exceptions to the statement that the top 2 most problematic issues
in any
of the 32 sample groups in either questionnaire are always ranked more highly
in
the
overall sample than the 2 least problematic issues in the same sample group.
Secondly,
there are only 2 exceptions to the statement that 3 out of the 4 most
problematic
issues in any sample group of responses to questionnaire 1 are ranked
amongst
the four 4 problematic issues in the overall sample. Furthermore in 12 of the
32
sample
groups, all 4 issues fall in the overall top 4.
(
Interestingly, for 12 of the 17 groups where only 3 of their top 4 fall in the
overall top
4, the
4th ranked issue is STRESS, the 5th most problematic issue in the overall
sample.
As
noted earlier, this issue incorporates reponses to individual statements 31 and
33,
whose
evaluation on the scale adopted was most suspect, depending on an assumption
about
the individual's role in the change.)
Thirdly,
there is only 1 exception to the statement that 2 out of the 3 most problematic
issues
in any sample group responses to questionnaire 2 are ranked amongst the 3 most
problematic
issues overall. Furthermore, 25 of the 32 groups have the same top 3 issues
as the
overall sample.
Having
said that, a number of exceptions and trends are observable amongst the sample
groups:
RESPONSE
DIFFERENCES ACCORDING TO CHANGES INDICATED
The
mean responses from the sample indicating the TQM change were generally less
problematic
than the overall reponse for both questionnaires.
As a
well publicised initiative, whose objectives have been the subject of numerous
presentations
and communications within the company, there are relatively low problems
perceived
with the issues of COMMITTMENT, INTEGRATION and ACCEPTABILITY.
Perhaps
not unsurprisingly, TQM scores relatively badly on issues of TRACK RECORD and
FEEDBACK,
consistent with a perceived lack of tangible benefits.
The
sample indicating the LRQA change produced the lowest average level of
perceived
problems
in questionnaire 1, although it exhibits virtually the same relative ranking of
problem
issues as the overall sample. Particularly low perceived problem levels were
indicated
for the issues of ACCEPTABILITY, EXPECTATIONS, PLANNING and TOP
SUPPORT.
This was a change whose success and schedule were known by all to be of
the
highest importance to top management and to FW's position in the market.
The
response from the sample indicating the SWIPE change also reflects the nature
of
the
change and its implementation. FEEDBACK was the least problematic issue, but
then
the
system provides some immediate feedback to those interested. It gave the 2nd
lowest
STRESS rating, but then it involved minimal new activities for most users.
Interestingly,
it scored above average perceived problem levels for the issues of
COMMITTMENT,
ACCEPTABILITY and EXPECTATIONS, but then the success of a
change
with minimum tangible impact on users does not necessarily demand high levels
of
committment and understanding of its fit with wider objectives.
The DMS
change reponse yielded the highest perceived problem levels for questionnaire
1. The
system involved in this change is now widely active and hence successfully
implemented.
This is reflected in the relatively low perceived problem level for TRACK
RECORD.
Nevertheless FEEDBACK yields a relatively high problem level, probably
reflecting
a significant body of users who remain sceptical about its benefits outweighing
the
extra effort and discipline. This too is consistent with the higher than
average
problem
ratings perceived for the issues of COMMITTMENT and ACCEPTABILITY and the
highest
perceived problems with STRESS. Despite higher than average problem ratings
for the
DMS change, TOP SUPPORT still yields one of the least problematic ratings,
reflecting
that users are nevertheless well aware of the importance that higher
management
attach to this system.
In
questionnaire 2, the change indicated is not directly relevant, but reflects
firstly, the
particular
groups of individuals who saw each change as relevant in the previous
questionnaire,
and secondly, the extent to which perceptions specific to the change are
carried
forward to the general issues in questionnaire 2.
In
fact, responses to questionnaire 2, the organisational diagnosis, vary little
with the
change
indicated in questionnaire 1. The only significant observation is that those
who
indicated
the DMS change also yielded higher than average general problem ratings for
questionnaire
2. This group yielded the most extreme perceived problem levels for the
issues
of LEADERSHIP and MOTIVATION, which appears quite consistent with this
group's
perception of the DMS change.
RESPONSE
DIFFERENCES ACCORDING TO SEX
As the
dominant sample, response to both questionnaires from the men more or less
reflect
the overall sample analysed earlier.
Women
perceived higher average problem levels for both questionnaires. Both sexes
agreed
on the four most problematic issues in questionnaire 1, but women perceived
COMMITTMENT
and ACCEPTABILITY issues of specific recent change as significantly
more
problematic.
Women
also considered STRESS as least problematic, which could reflect either that
women
are more tolerant of pressure, or that women in the organisation are less
exposed
to it. The
survey sample summaries in appendix S show that the distribution of womens
roles
are skewed into certain grades and departments, however to pursue any
correlations
and causal connections is beyond the scope of this dissertation. ( Remember
also
that responses concerning the STRESS issue are of more doubtful significance
due
to
survey limitations. )
In
questionnaire 2, women are also unique as a group in perceiving the definition
of KEY
TASKS
and objectives as one of the most problematic issues. The fact that the women
do
emphasise different issues from men supports the idea that encouraging women
into
a wider
range of roles and levels can only improve the balance of issues addressed in
future
decision making.
DIFFERENCES
ACCORDING TO STAFF GRADE
With
perceived problems of management style, LEADERSHIP and MOTIVATION as key
themes
emerging, any pattern or trend in perceptions across levels in the organisation
would
be of particular interest.
In
questionnaire 1, the change audit, those in the hihest grades, 18, 19 and 20,
yielded
higher
than average problem ratings but this does not seem to reflect any general
trend
across
the grades. Significant differences in the general ranking of issues include
the fact
that
ACCEPTABILITY and STRESS are elevated to the top two perceived problem issues
for
grades 17 to 20.
In
questionnaire 2, the organisational diagnosis, there are differences across
grades, but
again
no clear trends are apparent. All except grades 10 and 11 perceive MOTIVATION
and LEADERSHIP
as the two most problematic issues. Grades 10 and 11 place SUPPORT
and
MOTIVATION as the top two problem issues and relegate the issue of LEADERSHIP
below
STRUCTURE and PERFORMANCE. The lack of any clear trend is illustrated by the
fact
that grades 1 to 9, 12 to 14 and 17 all perceive the issues of MOTIVATION and
LEADERSHIP
more problematic than do grades 10 and 11, 15 and 16, and 18 to 20.
DIFFERENCES
ACCORDING TO AGE AND YEARS SERVICE
These
two groupings are analysed together because they exhibit very similar patterns,
probably
reflecting a correlation between age and length of service.
In
questionnaire 1, the two most problematic issues concern TRAINING and
COMMITTMENT
for ages up to 35 years and all lengths of service up to 10 years. Above
these
bands, there is a general reduction in average problem levels received,
bringing
issues
of INTEGRATION, ACCEPTABILITY and STRESS to the top of the list of problems.
In
questionnaire 2, the three most problematic issues remain MOTIVATION,
LEADERSHIP
and
organisational SUPPORT across all bands of age and all lengths of service,
except
those
46 to 50 years of age. The three issues perceived as least problematic,
RELATIONSHIPS,
ATTITUDES to change, and the definition of KEY TASKS and
objectives,
also remain the same across all bands, except for those over 16 years service
where
issues of structure are perceived less problematic.
DIFFERENCES
ACCORDING TO DEPARTMENT
There
are observable differences in response across departments, but the dominant
samples
from departments 153, 165 and the REST ( excluding 111, 112, 152, 193 and
196 )
agree most closely with the overall ranking of problem issues. The more marked
differences
are yielded by the less significant samples, department groups 111/112, 152
and
193/196.
Of the
more significant samples, Engineering and CAD department (153) yielded the
highest
average perceived problem levels for questionnaire 1, the change audit. Of the
less
significant samples, Process Engineering department (152) perceived the highest
average
problem levels.
Glasgow
departments (111/112) indicated COMMITTMENT and INTEGRATION as their
most
problematic issues, which would be consistent with a general perception that
Glasgow
tend to be less involved with Reading originated changes. It is worth noting at
this
point that the voluntary response rate to the questionnaire was particularly
low from
Glasgow.
Process
Engineering department (152), also one of the smaller less significant samples,
yielded
the highest average perceived problem level for questionnaire 1. It was however
also a
particularly flat response, such that even the two issues perceived as least
problematic,
TRACK RECORD and TOP SUPPORT, are in fact rated more problematic than
even
the average problem ratings of most other groupings.
In
questionnaire 2, the two most significant samples from Engineering and CAD
department
(153) and Materials Management department (165), show the highest
perceived
problem ratings for the MOTIVATION issue. Also in questionnaire 2,
department
152, Process Engineering, was unique in ranking ATTITUDE to change equal
to
LEADERSHIP as the most problematic perception, relegating MOTIVATION to third
place.
GENERAL
CONCLUSION FROM SAMPLE GROUP RESPONSES
The
general conclusion from this section must support the general observation at
the
start
of the analysis of sample group responses, namely that the ranking of perceived
problem
issues is uniform across most groupings. This can only reinforce the impression
that
the analysis of the overall response does reflect generally held perceptions.
A
possible alternative conclusion, which I believe should be discounted, is that
the design
and
execution of the survey is unsatisfactory and is perhaps unable to separate the
issues
involved. The responses could merely reflect some other random scatter of
responses
associated with surveys of this type rather than the specific statements and
issues.
Faith
that the survey does indeed reflect perceptions concerning the issues under
analysis
was
confirmed in particular by the variation of responses according to the change
indicated.
Significant variations in the change audit perceptions as a function of the
change
seemed to fit most plausibly with my own ab-initio experience of the specific
changes,
quite separate from the questionnaires themselves. Furthermore the rankings
of
responses to questionnaire 2, the organisational diagnosis were particularly
uniform
across
the same grouping. This was entirely consistent with the prior statement that
the
response
to the organisational diagnosis should not be directly dependant on the change
indicated
in the change audit.
Part of
the objective stated in the introduction was to identify FWEL's strengths and weaknesses
in relation to the management of change.
The
strengths can be summarised under four headings:
- Project Management
- Project Culture
- Networking
- Total Quality Management
The
weaknesses will be discussed under also under four headings:
- Bureaucratic / Role Culture
- Management Style
- Corporate Identity
- Performance Appraisal
STRENGTHS
- PROJECT MANAGEMENT
The
implementation phase of any change whose intended outcome can be pre-defined in
terms of deliverables can be managed as a project. Project management is a core
aspect of FWEL's operation and we should not be surprised to find this a
strength in the management of change. Visible top management support and clear
planning have contributed to successful implementation of specific changes.
STRENGTHS
- PROJECT CULTURE
As well
as the mechanics and skills of project management, a general feature of the
operation is that most functions are project based. The majority of the workforce
is accustomed to a fresh start on each new project assignment. This break with
the old is particularly clear-cut for those physically assigned to new task
forces. Many things about the new role will be the same as the old, but the
start of each new assignment is a trigger to ask what's new. The start of each
new project is also the natural opportunity to introduce new systems.
This
does not in itself overcome the natural fear of uncertainty in any new features
of a new project, but staff are used to having to cope with it. This feature
too may also contribute to the relative success in implementing specific
managed changes and to the positive attitude towards change perceived by
individuals.
A
counter feature however is the natural effect that in order to have a necessary
level of continuity from project, and in order not to reinvent too many wheels
each time, there is the need for formalised systems and contract execution
procedures against which tasks are planned and controlled.
STRENGTHS
- NETWORKING
The
regular setting up and disbanding of project teams means that individuals meet
a range of opposite numbers in different groups with which they must interface
on each project. Groups of individuals who gain good experience of team members
on one project have made useful contacts to draw on informally when
difficulties arise on later projects.
This
feature can at least partly explain why individuals generally perceive
satisfactory interpersonal relationships whilst experiencing some remoteness from
members of their home department and line management.
STRENGTHS
- TOTAL QUALITY MANAGEMENT
The
current TQM initiative already represents a significant investment in financial
and human capital. I am not able to claim from this project that there is
evidence of tangible success in TQM, but it is an undoubted asset in the
management of change.
Key
aspects include identifying relevant indicators of performance by open
brainstorming, monitoring and evaluating the indicators, diagnosing problems
and opportunities, evaluating and selecting courses of action and so on. The
aims and philosophies of TQM are entirely consistent with the management of
change
In
addition to the techniques and tools of change management, TQM also recognises
the importance of less tangible elements like culture and commitment, even if
it does not itself provide prescriptions for managing these.
WEAKNESSES
- A BUREAUCRATIC ROLE CULTURE
We have
already noted that the range of specialist disciplines and functional titles in
the organisation tend naturally to indicate a role culture. Even before quality
management systems became widely formalised, health and safety aspects of the
operation demanded clear definition of authority and responsibility for
technical decisions of all kinds. Extensive procedures and administrative
controls are a natural consequence.
As IT
spreads into the work processes and control systems, the controls can take on
the flavour of direct technological control. When it does, the balance between
control and discretion moves towards control, and it becomes increasingly
difficult to buck the system. I consider that these lines of argument can
explain some of the perceptions of an impersonal bureaucracy.
It seems
almost unnecessary to point out that such a culture is a weakness when trying
to encourage creativity and innovation.
WEAKNESSES
- MANAGEMENT STYLE AND LEADERSHIP
Another
inescapable weakness is the fact that management styles and leadership are perceived
to be ineffective and even discouraging.
We
noted that questionnaire statements referring to "my boss" drew
generally more favourable ratings, implying that the perceptions were levelled
mainly at higher management, however this is not necessarily the whole story.
Whilst some individuals’ perceptions of "higher management" will be
based on their direct experience of individual managers or directors, many will
not. Some will no doubt be based on here-say and reputations, but it is quite
possible that many could be attributed to a more anonymous image perceived
through the culture of the organisation.
(Added
1994) Note also the later survey (65) of 80 staff members of one particular large
department yielded extremely low ratings concerning the extent to which
management inspire leadership or any vision for the future - ratings so low as
to place them in the bottom 15 to 20% of any management population sampled.
WEAKNESSES
- PERFORMANCE APPRAISAL
Another
motivational weakness identified concerns the perception that performance
appraisal is infrequent and arbitrary. Linked to this perception is the
perception that there is insufficient attention to reward, recognition and
encouragement.
I
believe the importance of performance appraisal in encouraging creativity and
change is being overlooked. There is potential for linking such appraisal to
rewards and recognition in general.
WEAKNESSES
- CORPORATE IDENTITY
One
downside of the project management strengths and the project culture is the
weakening effect on corporate identity. Individuals identify with their current
project(s) and for good project management reasons are encouraged to do so. For
a large body of individuals, assigned to one project after another, links with
line management and corporate aims can be greatly weakened.
It is
not surprising therefore to find the perception, in both this survey and Paul
Peters' survey (45), that corporate goals and performance are not widely
recognised, and that corporate management appear somewhat remote.
Recommendations
are proposed under four headings:
- Total Quality Management
- Measures of Performance
- Corporate Identity Program
- Management Development
TOTAL QUALITY
MANAGEMENT – A ROSE BY ANY OTHER NAME
My
first recommendation is quite simply that any of the following recommendations
be explored and developed under the TQM banner using TQM tools and techniques.
I have already stressed that TQM is an important asset for the management of
change.
It
would be entirely inappropriate to institute a further general program of
change alongside or in place of TQM. To supersede TQM with a new initiative
concerned with change and flexibility would be to replace it with TQM by any
other name.
If
there are perceived to be blockages to achieving success with TQM in the
corporate sphere, as opposed to on projects, then these should be addressed
directly.
MEASURES
OF PERFORMANCE
As a
short-term measure, awareness of the importance of performance appraisal of
individual staff should be raised amongst all managers, who should be
encouraged to ensure that existing arrangements are at least applied regularly.
In the
longer term, measures of performance should be addressed more widely by an
appropriate Quality Team. Those measures directly relevant to individual
performance should become the basis of performance appraisal and performance
related rewards. For example, If contributions to change and flexibility are
valued by the company, then performance appraisal must reflect this. Ultimately
rewards should be directly related to such performance indicators.
The
concern with measures of performance is much wider than this however. We need
to be concerned with the "performance gap", or the "cost of poor
quality" in Juran TQM terms, across a whole range of values of importance
to the company. Subsequent use of such measures in all appropriate applications
can gradually define the cultural values within the company.
Carnall's
"measures of effectiveness matrix" (17) presented in figure 8.1, may
be used as a framework for brainstorming ideas relevant within FWEL. The
important point is that we should aim to identify a whole range of measures
that together give a balance between efficiency and effectiveness, between
resources and objectives, and between the quantitative and the qualitative. It
is a simple matter to identify quantitative effectiveness and efficiency
objectives like profitability, growth, productivities and reject rates. It
would be normal to find an existing imbalance of available measures in this
direction and qualitative resource measures are needed to restore the balance.
All
future Quality Teams will have this inventory of measures available on which to
base assessment of other desirable improvements, and against which to monitor
their progress. If the performance of TQM activities is to be valued, they too
need measures of performance.
CORPORATE
IDENTITY PROGRAM
Corporate
identity programs are credited with a whole range of operational, marketing and
other benefits, and may comprise a whole range of elements, from the visual
image of the corporate logo to the less tangible aspects of corporate culture
(45) (43). We are not concerned here with the arguments for or against FWEL
initiating a corporate identity program of this type, however the need to
address the extent to which staff identify with corporate aims, is a clear
conclusion of this project.
I
recommend that another quality team be charged with the task of establishing a
corporate communications program. The object would be to increase awareness of
corporate aims and performance against those aims. It must draw on the measures
of performance established above. It must also, where appropriate, raise
awareness of the significance of specific aims in relation to FWEL's position
and threats in the market and the environment in general.
Vehicles
of communication should not be limited to one-way top down publications and
presentations, but should also consider the use of more interactive discussions
at group levels. In other words such communication must address understanding,
commitment and involvement as well as information.
MANAGEMENT
DEVELOPMENT
It is
impossible that perceived problems with corporate leadership and management
style can be seen here as specific actual problems with specific remedies.
There can be little doubt however, that the perceptions are genuine and that
they do represent a blockage to creativity and change which needs to be
addressed.
We have
already acknowledged that part of the problem may be a general perception of
the culture rather than specific experience of individuals or groups of
managers. Strengthening the image of a wider range of corporate values can go
some way to improving this general cultural perception.
Perceived
visibility and remoteness of line management from project assigned staff could
only benefit from a simple recommendation that managers should increase their
use of "management by walking around". A renewed attention to regular
performance appraisal would also improve perceived visibility.
Reading
the perceived criticisms of discouraging management style and ineffective
leadership, managers may not openly recognise specific failings that they could
correct. Understanding and accepting such problems as may exist would however
be a pre-requisite for planning any remedial action.
Ensuring
that the range of performance indicators explored above included qualitative
management performance indicators is an essential step towards identifying such
problems. A natural next step is to ensure such indicators are included in
managers' performance appraisals. Management involvement in quality teams
addressing management performance indicators may in itself also contribute to
those managers recognising problems of management style.
In an
organisation tending towards a bureaucratic role culture, it would be
surprising not to find these development activities compromised by existing
politics, organisational defences (4) and various perceptual, emotional and
cultural blockages (2). Performance indicators themselves will be prone to
manipulation for diverse ends during definition, reporting and analysis. This
is one reason for ensuring that the widest range of performance indicators is
available and in use wherever appropriate.
Nevertheless,
it may be necessary to address such cultural blockages directly, rather than
expecting commitment to TQM and the establishment of clearer corporate values
to generate a gradual change in the underlying values. There are no clear
conclusions from this project as to how this might be achieved and there is
every indication that this would be a far from easy process. It is beyond this
dissertation to propose specific actions here.
This
project has been successful in achieving the stated objectives of identifying
strengths and weaknesses in the areas of attitudes and culture relevant to the
management of change at FWEL, and of identifying actions intended to exploit or
mitigate these. This dissertation has presented findings which may be
summarised as follows:
Concern
with future change and flexibility at FWEL is a relevant current issue
demanding attention with some urgency. FWEL must be ready to change in ways
that cannot necessarily be predicted.
FWEL's
Total Quality Management and Project Management resources provide powerful
mechanisms for managing change, but successful change and flexibility rely on
more than mechanisms. There are cultural weaknesses manifest in perceptions of
bureaucracy, management style and corporate identity, which the recommendations
address directly and indirectly.
As
acknowledged at the outset, the subject was wide and encompassed most general
management issues, many of which I have barely touched upon. Choosing to focus
on attitudes and perceptions of culture and style has presented a challenge in
objectivity of analysis and presentation.
The
survey itself, which made direct use of checklists presented by Carnall (17),
appears to have been successful in identifying the issues. Limitations arose
from failing to establish each respondent’s role or involvement in the specific
changes identified, and in the selection of sufficiently large samples from
some of the groups of interest.
The
actual response to the survey yielded no major surprises, however it provided
essential data without which objective analysis of intangible issues in the
FWEL context would have been near impossible.
There
were two conclusions that interested me in their own right, quite apart from
their future relevance to FWEL.
The
first was the realisation of the close parallel between the management of
change and TQM, although I did not followed up any links in the literature. It
reinforced the impression that making TQM work is an essential component of
future change and flexibility.
The
second was recognising the culture of the FWEL organisation in my own choice of
the organisational learning model of change as the starting point of my
analysis. I was starting with a logical, rational system model against which
the softer issues might be seen as secondary. It's the way we do things around
here, or at least it has been.
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(Added 1994) UNPUBLISHED.
LEADERSHIP PROFILES INVENTORY, FOSTER
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APPENDIX
B. COMPANY ORGANISATION AND
STRUCTURE
APPENDIX
C. PROCESS PLANTS DIVISION
STAFF PROFILE
APPENDIX D. THE STAFF SURVEY QUESTIONNAIRES
(Linked are zipped, scanned PDF copies of the Questionnaires actually used,
but with the statistical summary results pasted in.)
APPENDIX
S. SURVEY SUMMARY AFTER 90
RESPONSES