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achieved, bringing this to the attention of the client, and assisting management in deciding how to set up and implement an energy-conservation programme.

17.4 The human aspects of operations

Companies worldwide are trying to overcome autocratic, highly hierarchical and Taylorist organization concepts which cannot cope with the competitive imperatives of customization, innovation, speed, productivity and quality. Consultants can play a major part in facilitating the transition process to highperformance work systems. A consultant in operations management will have to deal with the human and technical aspects of production in an integrated manner. Furthermore, the consultant has to help the client to choose among a wide range of practices and techniques, and to effectively combine and apply those that are appropriate in a particular client context.

It is sometimes difficult for consultants to convince their clients that the traditional approach of fine-tuning subsystems without reviewing the overall organizational structure will not yield the desired success. Therefore, optimization of the aspects of operations described below should always be carried out with a view to the overall concept of production organization.

The quality issue is perhaps the best proof that the human element is the determining factor in any operation (see also Chapter 21). It would be naive to propose, let alone implement, any recommendation without the involvement of the employees concerned and without examining its impact on people. There are two major areas in operations management consultations to be considered in this respect: physical working conditions and safety improvement; and job enrichment and group work.

Physical working conditions and safety improvement

The consultant needs to pay attention to measures at the workplace to protect workers from adverse conditions of temperature, humidity, light and noise levels, as well as air contaminants, dust and radiation, exposure to which may cause poisoning or occupational diseases.12

Ideally, either hazards should be eliminated altogether or the workers should be removed from direct contact with hazardous situations. If this proves not to be feasible, then either the source of hazard should be isolated or the worker provided with protective equipment and clothing. A common mistake is to concentrate on the so-called technical aspects of accident prevention – the provision of protective gloves, boots or goggles, and guards for machinery. In most plants, however, over half of the accidents are caused more through human misjudgement and negligence than through the absence of guards or protective equipment.

The consultant can discover much revealing information by analysing past accident records for the causes of accidents, the department, hour of the day, and day of the week in which they most frequently occur, and even the person

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injured. This information can prove invaluable for a concerted plan of action to introduce a safety scheme. Any such scheme should invariably include training. Since accidents can happen despite all precautions, it is also appropriate to check on the availability and adequacy of health care, first aid and emergency and sanitation facilities, as well as fire protection systems.

Job enrichment and group work

Many operations consultants are productivity-conscious and can underestimate both the need for job satisfaction and the impact of job satisfaction on productivity. In a production environment, the process design, the method of work, the arrangement of work assignments and the physical working conditions greatly affect the workers’ satisfaction. There are several ways that job satisfaction may be increased, including job enlargement and job enrichment. Time cycles for tasks can be lengthened, particularly in the case of tedious, monotonous jobs; work can be made more varied by adding other tasks to the original one; or more authority may be delegated to workers who can then take their own decisions on certain work-related matters. In the same spirit, the authority of operators to decide on how to customize services can be increased in many service sectors.

Considerable research has been done on group work under various names: new forms of work organization, sociotechnical systems, industrial democracy and semi-autonomous groups. Whole factories (for example, the Volvo plant in Kalmar, Sweden) have been designed around these concepts, and many industries in Japan, Europe, North America, Australia, and some developing countries have introduced such systems with a reasonable degree of success. These systems rest on two fundamental concepts. First, in designing and modifying work, it is necessary to consider the technical and social issues together. Thus improved methods of work have to be reconciled with the social needs of the working group in terms of factors such as the variety and the degree of challenge the job offers, the opportunities for learning and advancement, and so on. Secondly, people performing a certain task should participate in redesigning their own job.13

In this respect, small-group activities in particular are well known. Quality circles have over the years extended their scope of activities to cost reduction and productivity improvement. The success of the quality circles idea prompted many companies in developed and developing countries alike to follow the Japanese model, adapting several of its features, with varying degrees of success. It is clear that the participation of production workers and supervisors in issues relating to their work is gaining wider acceptance.

Involvement and participation at the shop-floor level may seem to be at odds with a production consultant’s job perceived in a traditional way. This is not the case: all depends on the consultant’s and the client’s attitudes. A consultant who approaches the assignment claiming to know all the answers and wanting to impose his or her views will invariably fail. There are many technical and

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human aspects of each job that have to be taken into consideration when designing or modifying an operation, and no one can be expected to know every detail. The consultant may be surprised to find how readily people will respond to enquiries, and offer helpful suggestions for improvements, if they feel he or she is sincere, appreciates their views and has their needs and interests at heart. A consultant who develops such an attitude will soon find that involvement and participation, far from being obstacles, are key factors in the success of any assignment in production and operations.

1For a more detailed coverage of operations and production management, see for example R. B. Chase, N. J. Aquilano and F. R. Jacobs: Production and operations management (Homewood, IL, Irwin, 1998). Also, many of the topics covered in this chapter are treated in more detail in G. Kanawaty (ed.): Introduction to work study (Geneva, ILO, 4th ed., 1993).

2See, for example, S. G. Wheelwright, I. Clark and R. A. Hayes: Dynamic manufacturing (New York, The Free Press, 1988); or R. Schonberger: World class manufacturing (New York, The Free Press, 1982).

3See J. Womack, D. Jones and D. Roos: The machine that changed the world (New York, Rawson Associates, 1990).

4Cf. M. Hammer and J. Champy: Re-engineering the corporation (New York, Harper Business, 1993).

5See, for example, K. North: Environmental business management: An introduction,

Management Development Series, No. 30 (Geneva, ILO, 2nd ed., 1997).

6S. G. Wheelwright and K. B. Clark: Revolutionizing product development (New York, The Free Press, 1992), p. xi.

7Ibid., pp. 29–31.

8For an example from the automobile industry see K. Clarly and T. Fujimoto: Product development performance (Boston, MA, Harvard Business School Press, 1991).

9For a good overview see D. W. Dobler and D. N. Burt: Purchasing and supply management (New York, McGraw-Hill, 6th ed., 1996).

10For a detailed discussion see Kanawaty (ed.), op. cit.

11See North, op. cit.

12Extensive literature on these topics is available from ILO.

13See J. E. Thurman at al.: On business and work (Geneva, ILO, 1993).

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18.1 The changing nature of the personnel function

Personnel management, one of the traditional areas of management consulting, has undergone many changes over the past 20 to 30 years.

When consultants started dealing with the “people” side of business organizations, most of them tended to confine their interventions to problems grouped under the term “personnel administration”. In French-speaking countries personnel problems were included in the so-called gestion administrative (administrative management). In nearly all countries, a personnel administration specialist typically dealt mainly with personnel records, regulations and procedures, job evaluation, remuneration, and “employment” issues such as recruitment, selection, induction, promotion, discipline, termination of employment, and handling of grievances. Over the years this has broadened considerably. The main changes that currently affect the nature and role of the personnel function occur in the following areas.

First, the subjects of personnel management – people working in organizations

– have changed and continue to change in many respects. People have become better educated and prepared for their jobs, more aware of their rights, better informed and more interested in many issues of national and international economics and politics. Their value systems have changed; their employment and life aspirations have increased. Human relations within organizations have become complex, diversified and difficult to handle. These changes reflect not only technological development but also the significant trends of political and social change, such as the democratization of more and more countries (most dramatically, of course, in the former communist bloc), or the emergence of new social organizations and pressure groups (e.g. environmentalists and consumerists).

Second, an increased number of personnel issues, including conditions of employment, work and remuneration, are affected by legislation (including, in regions such as the European Union, international legislation), or have become the subject of collective agreements between workers’ and employers’

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organizations. When dealing with these questions the personnel consultant must be fully aware of issues such as the existing legal and labour-relations frameworks, the role of the trade unions and other workers’ representatives, and the need to inform or consult them in conformity with local practice.

Third, organizations are increasingly recognizing the value of their human resources, in terms of both cost and contribution. For most organizations, labour is the major operating cost item. Even where it is not, the skills and abilities of individual employees are critical. Human resources are the only ones that can generate added value out of other resources. Increasingly, organizations are coming to see their employees as a source of competitive advantage. It is recognized that most inventions or new services are readily copied by competitors, but the knowledge that is held within the organization, and the effective management of that knowledge, are much less easy to replicate. The important knowledge, of course, is not that which is written down, but the knowledge that exists in the minds of the organization’s people. Thus, achieving a balance between the cost and the capacity of human resources is a critical factor in organizational effectiveness and success.

One result of these changes has been the development of the concept of human resource management (HRM), as distinct from the more narrow concept of personnel administration or personnel management. Employees are viewed as the most valuable resource of an organization and from this basic premise a number of conclusions can be drawn as to ways of treating people. On the one hand, a focus on the cost side of the equation could involve a series of steps to limit spending on human resources and to link people more closely to results. It could include, for example, buying in labour capacity from outside the organization. On the other hand, a focus on capacity could lead to significant investment in motivating people for higher performance, in the role of leadership, through investment in training and development, or the choice of staff development systems.

A wide range of organizational development theories and concepts have emerged, and are being applied to the analysis of human problems in organizations, and to methods likely to increase the effectiveness of individuals and groups in achieving organizational goals.

Fourth, technological changes have had a significant impact on the way people are managed. This impact has been felt throughout the HRM environment, from the global integration of business through to the way that communication with employees is conducted. Before identifying a few key effects it is worth making the point that throughout the world there are vast numbers of employees almost untouched – at least directly – by technological change. Even within highly technical industries, international airlines for example, there are still people whose job is mainly to shift heavy materials by hand. Nevertheless, the impact of technological change operates at all levels. At the global level, technological change has “shrunk the globe”, making it easy to transfer goods and services around the world, improving the position of some nations and putting others under pressure. At the national level, technological change has led to a transfer of employment from primary industry (agriculture,

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