Strategies in U.S. Organizations
A key strategic issue for all corporations in the United States involves labor relations (Mello, 2009, p. 540); the programs utilized within U.S. organizations may impact employee morale, productivity, adaptability and cooperation. Labor relations involve management’s ability to or strategies utilized to prevent and resolve workplace issues with employees. For example, Germany's Volkswagen utilizes a program called, Works Councils (Finkin, & Kochan, 2014). This program allows employees to share their work to reduce working hours rather than allow management to lay off employees at the company. On the other hand, Southwest Airlines, and Kaiser Permanente tailored programs specific to fit their individual company needs (Finkin, & Kochan, 2014).
Lima Tire Company, a subsidiary of Treadway Tire Company was having issues with high operational cost and high turnover among foremen. Although the programs that were designed to control labor relations for the company; they were not effective as the company hoped. The company still faced the issue of a dysfunctional organization (Skinner, & Beckham, 2008). So, what are some of the strategies utilized by U.S. union free organizations today and why is it critical to the success of an organization to meet its goals and mission? This paper presents a summary of Lima Tire Company, a non-unionized organization, provides an alternative to handling its major problems, and provides a recommendation to help with the major issues.
Brief Case Overview
By the opening of the Lima Tire Plant in January 2008, Ashley Wall, the current Director of Human Resources has to devise plans that will correct several serious problems the company faced. Currently the HR Director saw an increased turnover rate among foremen, lack of training, skyrocketing raw material cost, global competition, productivity issues, low morale, and employee dissatisfaction within the company (Skinner, & Beckham, 2008).
Major Issues
Although all of these are serious issues, an increased turnover rate and a dysfunctional organization are the major issues. The remainder of the issues the company faced were only minor but significant issues (Skinner, & Beckham, 2008).
Alternative Action
Considering Lima Tire Plant is a dysfunctional organization with a high turnover rate among foreman and does not train its employees well; I will begin with taking action into correcting the high turnover rate issue. Since the majority of foreman who oversaw all phases of production were non-union Lima Tire Plant employees; the HR Director should have started a mixture of two programs like Southwest Airlines and Kaiser Permanent as an alternative. Southwest Airlines designed their plan to fit their organizational needs according to federal regulations; while Kaiser Permanent designed a Labor-Management Partnership into managerial groups to represent employees (Figueroa, & Lazes, 2002; Southwest Airlines, 2014) These programs combined will set employee/organizational goals, improve performance, labor relations, competitiveness, and job satisfaction combined (Figueroa, & Lazes, 2002).
Therefore, designing a program to fit Lima Tire would incorporate the 50 line foreman in one program, the 13 general supervisors in one program, and the remainder line segment employees in another program. Assuming that the line segment employees are hourly; there should be no issues faced by the company to implement the program. In addition, the 5 area managers would be in one program; while plant managers will be in one program, filling in the remainder of the positions into sections.
In addition, the company saw a lack of training among foreman to transfer to managerial positions; this program will allow the company to train some of its foeman into managers. To handle this problem the company can devise a training program to include interest-based problem solving, partnership skills, education on internal and external economic reality issues (Figueroa, & Lazes, 2002). For example, Eastern Airlines allows employees complete access to company financial records to help smooth labor relations; while the owners of Disneyland and their employees compromised on a wage freeze (Bernstein, 1985). Doing so allows employees to provide input on how the company can grow to become a successful organization.
Recommendations
Fortunately, Southwest Airlines utilizes 4 different programs with 6 being in the negotiation stages (Southwest, 2014); and Kaiser Permanente designed its own Labor Management Partnership made up of 27 union locals, Kaiser Permanente and the Permanente medical groups in each operating region (Figueroa, & Lazes, 2012, p. 53). Unfortunately, having a high turnover for Lima puts more emphasis on the high turnover rate than on the training provided to foreman to transfer into management positions. Furthermore, foremen were categorized at Lima into separate operating departments: Production, Maintenance, Material Control, and Quality Assurance (Skinner, & Beckham, 2008). Therefore, in order to fill these open positions within the company; Lima’s management was forced to utilize college dropouts; resulting in a blue collar labor force.
Therefore, it is my recommendation that Lima Tire Company/Treadway negotiate a plan with the American Federation of Labor – Congress of Industrial Organizations (AFL-CIO). The AFL-CIO promotes all the key areas that Lima is lacking: training and job satisfaction. This federal program develops ways to address increasing market pressures and severely deteriorated labor-management relations (Figueroa, & Lazes, 2002). Kaiser Permanent utilizes the AFL-CIO as a labor management partnership to ensure employees have a voice in the workplace to provide input on the business activities and regarding changes within the company, have job security, and the AFL-CIO ensures that employees maintain a leading wage and benefit package with the company (Figueroa, & Lazes, 2002).
Conclusion
In conclusion, Lima Tire Company needs to design a quick program that will deter high foreman turnover and improve employee satisfaction before the company sees another closure. For that reason, a unionized workplace can help identify and sustain improvement activities and create a collaborative work culture for any non-union organization. Entering into a contract agreement with the AFL-CIO or implementing its own Labor Management Program are several of many strategies implemented by U.S. corporations today. The AFL-CIO was enacted in 1955 via a merger between the AFL (the American Federation of Labor) and the CIO (Congress of Industrial Organizations) to improve lives of the individuals who work in the United States; the program is a democratic organization that helps create a respectful workplace via supportive partnerships with organizations to allow collective bargaining (AFL-CIO, 2014). References
AFL-CIO. (2014). What the AFL-CIO does? Retrieved on October 17, 2014 from http://www.aflcio.org/About/What-the-AFL-CIO-Does
Bernstein, H. (1985, January 23). If Eastern pact works, it could become model. Los Angeles Times. Retrieved from http://articles.latimes.com/1985-01-23/business/fi-14608_1_labor-relations
Figueroa, M., & Lazes, P. (2002, July). Labor-management participation in the healthcare industry. Retrieved from Cornell University, New York, ILR School Healthcare Transformation Project website: http://www.ilr.cornell.edu/healthcare/our-research-and-publications/index.html
Finkin, M., & Kochan, T. (2014, January 20). The Volkswagen way to better labor-management relations. Los Angeles Times. Retrieved from http://articles.latimes.com/2014/jan/20/opinion/la-oe-finkin-vw-work-councils-20140120
Mello, J. A. (2009). Labor relations. In Strategic Human Resource Management (4th ed.), (pp.539-567). Stamford, Connecticut: Cengage Learning
Skinner, W., & Beckham, H. (2008, June 12). The Treadway tire company: Job dissatisfaction and high turnover at the Lima tire plant. Harvard Business Review. Retrieved from http://hbr.org
Southwest Airlines. (2014). Labor relations. Retrieved on October 11, 2014 from http://swamedia.com/channels/labor-relations/pages/labor-relations#chart