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This report analyses the need and the reasoning for a management information system (MIS) for the security department during the Olympics London 2012. This report looks at the functions of the security department and how they will benefit from an effective information management system. Furthermore, the report discusses how management information systems are used for decision making and the importance of implementing such systems within any organization.

Executive summary

One of the most fundamental functions in any organization is the decision making process. When one considers the economy we face today, many organizations come to appreciate the importance of being able to challenge competitors, gain advantages and make intelligent use of their resources. The core element of this is the process of making decisions. Information can be central in achieving management goals successfully. To facilitate decision making it is imperative that managers have the correct information at the correct time to overcome the gap between needs and prospects. Furthermore to aid improvements in communication of information adequate management information systems (mis) are indispensable. Thus it is vital to have an appreciation of the management information systems used in an organization and have effective integration, by all levels of management. It is only then that there will be effective, profitable and constructive decision making.

Terms of reference

On the instruction of the senior manager, the security department was asked to evaluate and analyse the requirements for the duration of the London Olympics 2012. Details of the importance of information required and detailing what information will be required plays an important role in the reporting back to the senior manager.

Introduction

Regardless of the nature of an organization, every organization is filled with information. The information content of organizations is what makes the business function. The role of information in an organization is crucial. Information is important in order to allow for an organization to plan, control, measure performance, record movements and assist with decision making. Management information systems are the conversion and collaboration of this information, from both internal and external data sources into a format which is easily communicated and understood by managers at all levels. Ensuring that information is well structured and effectively stored allows ease of access and timely and effective decision making. Larry long and nancy long (2005, p. 370) describe an information system as: “a system is any group of components (functions, people, activities, events, and so on) that interface with and complement one another to achieve one or more predefined goals” (donald, 2005). Information system may also be considered to be a generic reference to a technology-based system that does two things: providing information processing capabilities and providing information people need to make better, more informed decisions (donald, 2005).

Management information systems are the result of a combination of internal and external sources; they provide a means by which data/ information can be easily manipulated, stored, amended etc. Furthermore, management information systems coalesce all the essentials which assist in the decision making process.

Security is by no means limited to any one aspect of an organization, particularly when on consider an event as large and as globally involving the London Olympics – 2012. For any organization, security cover the physical security of those involved, security of buildings and offices and security if information technology, both physical equipment and cyber security. Assistant commissioner chris allison released a brief on the security issues and concerns surrounding London 2012; his brief included all the ordinary security concerns, such as terrorism and petty crime, but also the danger of online ticket scams, potential protesters hijacking olympic websites and also the more sinister criminals (hervey, 2010).

The overall vision for the London 2012 olympic games and paralympic games, agreed by the olympic board is, ‘to host an inspirational, safe and inclusive olympic games and paralympic games and leave a sustainable legacy for London and the uk’ (London2012, 2010). In order to achieve this there any many threats and many angles from which threats can occur which need to be taken in to consideration. Furthermore, in order to manage and ensure security the information systems implemented must allow for effective decision making prior to the event and most importantly in the event of an untoward happening.

Findings and analysis

The security department cannot be limited to one specific function. The security department, especially for London Olympics 2012, will involve the handling of many aspects of potential threats to the people and systems involved for the Olympics. There are two primary areas which the security department will be responsible for. Firstly, cyber security and secondly the security of the public.

Cyber security

As technology, its uses and abuses expand at hasty rates, so does the level of threat faced by organizations and their information systems. Information technology forms an important feature of the information systems in place today. Information systems define what needs to done or managed and the information technology aspect is how this is done. Therefore, technological advancements and the increase in their abuse is a major threat where London Olympics 2012 is concerned.

A case study by students of the pennsylvania state university looked into some of the major threats which organization face in the form of it threats. These included; wireless network security, cryptography, access control, privacy control, risk management, operating system security, including server threats, vulnerabilities and firewalls. These are just a handful of examples (bogolea & wijekuma, n.d.). Amongst these examples and besides these examples are many others which are an easy cause for concern for London Olympics 2012.

For any organization it is imperative to exercise control over their computer based information systems. London 2012 needs to ensure that the computer based systems, those which rely on it are protected from threats, as the cost of errors and irregularities that may arise in these systems can be high and may even challenge the very survival of the event. An organizations ability to survive can be severely undermined through corruption or destruction of its database; decision making errors caused by poor-quality information systems; losses incurred through computer abuses; loss of computer assets and their control on how the computers are used within the organization (mandol & verma, 2004).

Cyber security expert professor peter sommer of the London school of economics warned that computer security would be extremely important during the games (hervey, 2010). A case study which looks at the tragic death of two boys 18, and 10 years of age discusses how cyber security was the issue in relation to the gasoline leak of olympic pipelines pipeline (abrams & weiss, n.d.). This is an example of the devastation to human life which cyber threats can cause, and when one considers this on the scale of London 2012, it becomes clear the number of people depending on optimum security.

In order to combat this threat, information needs to be obtained from both internal and external sources. External information may include information from professionals in the cyber security industry to information from intelligence agencies. Terrorism is as much of a cyber-threat as is the computer virus or any other infection. Information systems will only be able to cope with and combat these threats by ensuring they all well informed through risk assessments of potential dangers. Furthermore, in order to overcome any unexpected threats contingency planning forms an essential element of information systems development.

Risk assessment is an important step in a risk management procedure. Risk assessment is the determination of the quantitative or qualitative value of a risk related to an actual situation and a recognized threat. Maroochy water services, australia, are an organization a world apart from London olympic 2012, however for the purpose of their cyber security improvement program; risk assessment establishment played a key role (abrams & weiss, 2008). This example shows that important of risk assessments if by no means limited by industry, size of organization, or any other feature for that matter. Risk assessments provide a means for any organization to help avoid potential threats through prior consideration.

In addition to information required for a risk assessment, is the information required for a contingency plan. A contingency plan is a plan of action for if things were to go wrong. It is a backup plan. In order to overcome any type of disaster information must be collated into a contingency plan. This would again form an essential part of the information systems, as it would be crucial in the event of a disaster.

People

London Olympics 2012 will see several thousands of people from all over the globe in London. Amongst visitors will be players, key visitors and reporters. Those visiting, and then those who already reside in the uk, accumulate to an increase in population, and thus there is a risk of increase in crime. The crime can range from petty crime, to terrorism. The common factor amongst all, is that people need to be protected.

Security has been a crucial concern at the Olympics since the killing of 11 israeli athletes and coaches at the 1972 munich games. Olympic planners have ramped up security following the september 11, 2001, attacks in the united states (wilson, 2010). Inefficient management of the people involved in the Olympics and the public, can have devastating effects. This is a major concern during and time and for a city where terrorism is a real and potential threat.

In order to be able to implement information systems which can cope with, and appreciate the requirements with regards to security, information needs to collated from many sources. First of all, predictions are one of the very first decision making elements which need to be fulfilled by an information system in this situation. Information regarding the number of athletes expected to be present during the Olympics, statistics from previous olympic games will be required regarding the number of spectators/visitors the country had, and finally the number of security staff and resources available at present. By means of prediction and analysis through a computer being able to protect and serve the public can be achieved. The information system may be used to obtain information concerning the number of staff which will be required to patrol the streets. The number of security staff which will need to be put in to place to sufficiently protect the athletes and their trainers. Also, the locations which are expected to be busiest can be recognized, and thus will require more staff and concentration of cctv cameras.

In addition to predictions, is the actual information which will need to be included in an information system, this is information about the number of police officers, or security guards in other areas, or cities besides London that can assist in providing security in this situation. This information may well form a part of the contingency planning.
Where cctv cameras are concerned, or access controls, id badges etc there is the need for information systems to collate and manage all this information. Systems will be need to record information of who accessed which area or building at which time for access/ id cards, cctv will need to keep a recording of all activities captured, and there will be the need for databases to log people working for the period of the Olympics and athletes. This information will help to deter crime, provide an element of security and protect people.

Conclusions

Information systems come in not set type or standard. They are the collation of several information sets to provide a well-integrated system used to make decisions. The London Olympics 2012 are like no other organization, and are on a scale grander and vast the most other organizations deal with. It is this grandness and this large scale involvement of people, which in turn increases the risks and potential threats. London Olympics 2012 is an enormous event and is expected to employ several thousands of people. And furthermore have several thousand spectators, reporters etc. An effective and accurate management information system is essential in order to ensure that the city hosting the event is able to effectively plan, control, record people and protect systems. Hudson bank managed to overcome the problems it faced with adaptation of its information system, some of this was done using off the shelf software and the majority through establishment of customer requirements and communication essentials (anon., 2008).

The security department is involved with many people and many types of threats; the most important two being, securing people and securing systems. Cyber threats can not only damage systems, but even cease functioning of the event. In order to avoid this it is important that the potential risks are assessed, all that can be done to avoid them striking is done and contingency plans are set for action.

Another important aspect is protecting people. In order to do more staff would be required, police, community support, security guards etc. This is a large amount of shifting people around, staff from other cities, new recruits etc. Therefore it is vital that this information is managed efficiently. The information systems should be able to cope with large numbers of peoples and provide effective and accurate predictions and decision making results. As with all information systems, the number of information sources will need to extensive in order to provide optimum results.

Recommendations

Taking in to consideration the need and scope of the management information systems for the Olympics in London 2012, particularly the security departments’ involvement and requirements the following recommendations are made:

The security department need to ensure that all staff involved with the use of the information systems for them is full trained. Any glitch can have dire effects on the rest of the system and ignorance of any warnings of threats can also be horrific in consequence. Training is not only limited to the staff working with the systems, it is also important that staff working with people are trained to handle a large number of people, overcome any problems, identify potential threats, maintain the cooperation of people in the event of a disaster etc.

Risk assessments and contingency plans should be in place for each and every aspect of security. Furthermore, all staff should be made aware of both of these reports, particularly contingency planning. This will only help them do their job better and overcome any disasters. Informing staff will provide a more thoroughly aware work force and maintenance of security in the event of a disaster.

References

Abrams, m. & weiss, j., 2008. Malicious control system cyber security attack case study. Case study. Australia: maroochy water services.
Abrams, m. & weiss, j., n.d. Bellingham, washington, control system cyber security case study. Case study.
Anon., 2008. Banking on customer service. New jersey: hudson bank.
Bogolea, b. & wijekuma, k., n.d. Information security creation. Case study. Pennsylvania: the pennsylvania state university.
Donald, a., 2005. Mastering information management. Prentice hall.
Fitzpatrick, k., Fujimoto, y., Hartel, c. & strybosch, v., 2007. Human resource management: transforming theory into innovative practice. Malaysia: pearson australia group pte ltd.
Hervey, l., 2010. Sky news. [online] available at: hyperlink “http://news.sky.com/skynews/home/twin-terror-threat-to-London-Olympics-security-expert-warn/article/201003415579707” http://news.sky.com/skynews/home/twin-terror-threat-to-London-Olympics-security-expert-warn/article/201003415579707 [accessed 16 august 2010].
London2012, 2010. London 2012 sustainability policy. [online] London 2012 available at: hyperlink “http://www.London2012.com/documents/locog-publications/London-2012-sustainability-policy.pdf” http://www.London2012.com/documents/locog-publications/London-2012-sustainability-policy.pdf [accessed 6 august 2010].
Mandol, p. & verma, m., 2004. Formulation of it auditing standards. Case study. China: national audit office.
Wilson, s., 2010. Yahoo news. [online] available at: hyperlink “%20http://news.yahoo.com/s/ap/20100806/ap_on_sp_ol/oly_London2012_security” http://news.yahoo.com/s/ap/20100806/ap_on_sp_ol/oly_London2012_security [accessed 16 august 2010].

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Dissertation Proposal: An Examination of Legal, Ethical and Social Issues on Information Systems

Provisional Title

The Provisional Title of the Dissertation is as follows: “An Examination of Legal, Ethical and Social Issues on Information Systems”.

Brief Review of the Related Literature

We will begin our review of the related literature with a close examination of the literature concerning the definition of Information Systems. A clear definition of the concept of Information Systems is vital, because as Currie shows there is a great disparity between the extents to which clear concepts apply in a field such as chemistry compared with the academic discipline of management. “For example, physical chemists know exactly what they mean by ‘entropy’. Would-be scholars in the management field, on the other hand, have no shared precise meaning for many of their relevant concepts, for example ‘role’, ‘norm’, ‘culture’ or ‘information system’ all these terms are often fuzzy as a result of their unreflective use in everyday chat” (Currie 1999: pp.46). In this passage Currie eloquently sums up the task before us when we attempt to define the concept of Information Systems. The conceptual haziness and lazy use of concepts such as Information Systems in everyday usage as well as in academic circles has led to a situation in which providing a clear definition of the concept of Information Systems is a highly complex undertaking. For this reason it is probably not possible to provide a rigid and narrow definition of the concept of Information Systems, because any such definition will be criticised for its inability to incorporate the broad spectrum of features that management scholars understand by the term Information Systems. Many management scholars prefer this approach to the concept of Information Systems and the approach of Rainer is a clear example of this. She understands the concept of Information Systems to be a broad concept incorporating any number of activities that include the use of information technology to support management operations. “It has been said that the purpose of information systems is to get the right information to the right people at the right time in the right amount and in the right format” (Rainer 2009: pp.10). She looks closely at a range of concepts that full under the umbrella term of Information Systems and argues that “one of the primary goals of information systems is to economically process data into information and knowledge” (Rainer 2009: pp.10).

The UK Academy for Information Systems agrees with the type of broad definition offered by Rainer and defines Information Systems as “the means by which people and organisations, utilising technologies, gather, process, store, use and disseminate information” (UK Academy for Information Systems 1999: pp.1). It is clear, therefore, that the term information Systems can be used and applied to a wide variety of activities.

Information Systems can denote the interaction between people, data, technology and knowledge and as a result Buckland also argues that a broad definition of the concept is desirable. As he explains, “information systems deal with data, texts and objects, with millions of these objects on endless miles of shelving, in untold filing cabinets, and on innumerable magnetic and optical devices with enormous data storage capacities” (Buckland 1991: pp.69). Buckland goes on to specify one of the most important reasons why a clear and concise definition of Information Systems is so difficult to attain. He argues that “any significant change in the nature or characteristics of the technology for handling the representations of knowledge, facts and beliefs could have profound effects on information systems and information services” (Buckland 1991: pp.69). In other words, Information Systems are likely to be affected by such an enormous variety of factors that a concise definition of the concept will probably always fail to include some important elements of the concept. It is for this reason that it is advisable for the purposes of this investigation to proceed in the same manner as the vast majority of the literature and therefore operate with a very broad and inclusive definition of the concept of Information Systems.

The next challenge that lies before us is to illustrate some of the most salient and prominent legal issues associated with Information Systems. Sacca defines one of the major challenges in the relationship between Information Systems and legal issues when he states that “first of all, the Rule of Law is based on these unavoidable elements, among others: equality and freedom of citizens. How can the legal system put this element into effect in a highly technological society?” (Sacca 2009: pp.29). Sacca argues that legislation governing the use of Information Systems has existed for a long time, stretching back as far as the 1970s, but that such legislation must constantly be updated in order to be able to keep up with the pace of innovation. He therefore proposes, for example, a “dialogue between institutions and citizens based upon a ‘digital citizenship’” in order to fully exploit the relationship between Information Systems, the government and people and set up an e-government in which everybody who has access to a computer and Internet can participate.

As Sacca states, “democratic legal systems have to foster and promote civil and political rights also with reference to the use of ICT, against digital divide” (Sacca 2009: pp.29). However, the issue of electronic democracy is only one of many legal issues that has been raised by the development of Information Systems. Pollack argues that “we are living in an era in which we routinely deal with issues such as privacy, digital security, identity theft, spyware, phishing, Internet pornography and spam. These costly and time consuming concerns were completely foreign to the American public only a few years ago” (Pollack 2006: pp.172). It is clear, therefore, that there are a multitude of legal issues surrounding Information Systems and Adamski argues that how we deal with information and data is a critical part of how we function as a modern liberal democracy and that the legal system must reflect this emphasis upon freedom of information. “Information, being an intangible and an entity that can be possessed, shared and reproduced by many, is not capable of being property as most corporeal objects do. Unlike corporeal objects, which are more exclusively attributed to certain persons, information is rather a public good. As such it must principally flow freely in a free society” (Adamski 2007: pp.1). It is clear, therefore, that legal issues are of vital importance with regard to Information Systems and that a multitude of issues must be examined in order to fully understand the relationship between Information Systems and the Rule of Law.

In the next section we will examine the extent to which ethical issues impact upon Information Systems. A study on the relationship between ethics and Information Systems has defined ethics as “the principles of right and wrong that individuals, acting as free moral agents, use to make choices that guide their behaviours” (Ethical and Social Issues 2010: pp.128). The study argues that the development of Information Systems has fundamentally transformed the relationship between management and ethics because new Information Systems give rise to a series of new ethical dilemmas. The study argues that “information systems raise new ethical questions for both individuals and societies because they create opportunities for intense social change, and thus threaten existing distributions of power, money, rights, and obligations” (Ethical and Social Issues 2010: pp.128).

Many of the ethical problems of Information Systems were foreseen by Mason in a famous study conducted in 1986 entitled ‘Four Ethical Issues of the Information Age’. In this study Mason argues that there will be above all four ethical issues that will dominate the era in which information Systems will dominate. He defined four ethical issues, namely “privacy, accuracy, property and accessibility” (Mason 1986: pp.5). Mason raised a number of pertinent questions that are indeed still relevant today and help us greatly in our quest to fully understand the relationship between legal, ethical and social issues and Information Systems. For example, with regard to privacy Mason asked, “What information about one’s self or one’s associations must a person reveal to others, under what conditions and with what safeguards? What things can people keep to themselves and not be forced to reveal to others?” (Mason 1986: pp.5). At this point it is important to point out that whilst such questions are clearly ethical questions in nature, the answers that society provides to such questions have clear and profound social dimensions and therefore the relationship between ethical and social issues is inextricably linked with regard to Information Systems. As the study on Ethical and Social Issues points out, “like other technologies, such as steam engines, electricity, the telephone, and the radio, information technology can be used to achieve social progress, but it can also be used to commit crimes and threaten cherished social values. The development of information technology will produce benefits for many and costs for others” (Ethical and Social Issues 2010: pp.128).

Despite the fact that ethical and social issues are inextricably intertwined, it is important that we delineate between the two concepts and in the final section of this dissertation we will focus upon the social issues relating to Information Systems. Here we will examine some of the most prominent social issues that arise when dealing with Information Systems. Some of the social questions we will examine concern the extent to which society is affected by a move toward computer-based systems. What costs do societies incur by doing so and what benefits do they accrue as a result? Do increased levels of automation affect employment patterns and cause people in lower social classes to lose employment opportunities? Will the rise of Information Systems serve to strengthen or dilute class divisions? It is possible to argue that Information Systems serve only to expand the power of the rich, because they re-enforce existing prejudices against the poor. As Wilson argues, “the economic climate and the differential stratification of resources will define some work environments as ‘information-poor’ and others as ‘information-rich’, with consequent effects upon the probability of information-seeking behaviour and the choice of channel of communication (Wilson 2006: pp.665). Another important social concerns the extent to which Information Systems will give rise to greater Identity Theft in which ordinary citizens are the victims and the great rise in the numbers of Identity Theft victims shows that there are a large number of negative social issues that have occurred since the birth of Information Systems.

Aims and objectives of the research

The aim of this dissertation is to encompass a broad spectrum of academic research in order to fully examine the legal, ethical and social issues on Information Systems. In order to be able to complete this task competently, we must first of all begin by outlining a clear structure of how this dissertation will be completed. We will conduct this investigation in five distinct sections. In the first section we will seek to define the concept of Information Systems. This is a vital task in this dissertation because in order to be able to fully and adequately analyse the legal, ethical and social issues on Information Systems we must first of all clearly define the concept of Information Systems in order to be able to proceed any further. In the next three sections we will focus upon the legal, ethical and social issues on Information Systems. We will examine each one of these issues in turn and begin by defining some of the most important issues that are relevant to Information Systems in each field. Once we have defined the relevant concepts in this dissertation we will move on to apply the concepts to an organisation that clearly reflects a number of pertinent issues raised by the literature review.

We have chosen to focus upon the firm Panasonic, because it is an example of an organisation that has been greatly affected by the developments of Information Systems over the last few decades and will allow us to fully explore the social, ethical and legal issues that arise when dealing with Information Systems.

Statement of the Design and Methodology

This investigation will allow us to critically evaluate the impact of legal, social and ethical issues upon Information Systems, focusing particularly on the organisation of Panasonic. It is likely that this dissertation will take a considerable amount of time and we will need to ensure that we have access to the relevant data and statistics that will be necessary in order to support and justify our findings. The aim of this dissertation is to clearly present a theoretical framework from which we can critically examine and evaluate the most important concepts within the title of this investigation. Once the internal theoretical framework has been established we will move on to apply the theoretical framework to the external world in order to analyse the extent to which this theoretical framework is supported by the realities of running a modern organisation in the real world. This will allow us to transfer the internal theoretical framework to the external world where such theoretical concepts operate.

Sources and Acquisition of Data

Throughout this dissertation we will focus primarily upon primary and secondary academic literature in order to establish the theoretical framework upon which this investigation will be based. If possible, it would also be useful to conduct some first-hand interviews with employees and manager of Panasonic in order to ascertain the impact that our theoretical framework has upon the company.

Method of Data Analysis

Throughout this dissertation we will employ both deductive and quantitative techniques as well as inductive and qualitative techniques. The literature review will be primarily based upon qualitative techniques, but we will also focus upon quantitative techniques in order to be able to compare the data and statistics that we found in our literature review with the evidence we will assemble from the firm Panasonic. We will also use both deductive and inductive techniques throughout this investigation and allow for the fact that the conclusions we reach may be false in nature. This type of hypothetical reasoning will strengthen our ultimate conclusions and findings.

Form of Presentation

The dissertation will be presented in written form, but where necessary relevant graphs, tables, charts and illustrations will be included in order to provide statistical data that support and justify the conclusions reached in this investigation.

References and Bibliography

Adamski, A., 2007. Information Management: Legal and Security Issues, pp.1-17

Buckland, M., 1991. Information and Information Systems. London: Greenwood Publishing

Currie, W., 1999. rethinking Management Information Systems. Oxford: Oxford University Press

Ethical and Social Issues in Information Systems, 2010, pp.124-165. http://www.prenhall.com/behindthebook/0132304619/pdf/laudon%20MIS10_CH-04%20FINAL.pdf Accessed 26/07/2010

Mason, R., 1986. Four Ethical Issues of the Information Age. Management Information Systems Quarterly, 10 (1), pp.5-12

Pollack, T., 2006. Ethical and Legal Issues for the Information Systems Professional. Proceedings of the 2006 ASCUE Conference, pp.172-180

Rainer, K., 2009. Introduction to Information Systems: Enabling and Transforming Business. London: Wiley Publishing

Sacca, D., 2009. Information Systems: People, Organisations, Institutions and Technologies. New York: Springer Publishing

UK Academy for Information Systems, 1999. The Definition of Information Systems, pp.1-6

Wilson, T., 2006. On User Studies and Information Needs. Journal of Documentation 62 (6), pp.658-670

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Open Health: A research prospectus on HMIS research
Introduction

Change management decision models based on shifts within the global economic order have forced administrators to seek new systems and relationships of oversight as organizations switch from traditional vertical work relationships to horizontal interactions. Much of the insight built into recommendations toward better change management models has been developed in scientific fields of practice. The interest in management of knowledge by science communities, and especially the integration of practice into localized IT systems has long been promoted by consultants and advisors to those fields, whom look to channels of facilitation as viable strategies toward competition in the context of change. The popularity of IT systems management as strategic model for practice field growth, as well as a core competency for institutional change, is well established. Cost cutting and innovative, IT knowledge sharing networks expand the options of institutions and professionals. Competitiveness now equates with interface with the highest calibre artificial intelligence in advancement of human potential toward global solutions that promise to enhance a new generation in oversight.

Andrew Grove, former CEO of Intel once observed that “only paranoid firms survive, primarily because they continuously analyse their external environments and competition, but also because they continuously innovate” (Hitt et al. 1995). Grove’s assertions are echoed by many corporate executives, whom have become sold on the constancy of research and development as the single most powerful source of competitive capital in organizations faced with ‘new market’ competition. For instance, the equity of ‘value’ is a price statement or ‘proposition,’ as well as a method of translating brand identity within the market through illustrated performance of a product. For service organizations, structural response to delivery is still inherent to value. Practice settings are environments desire synthetic opportunities to forge alliances between internal and external forces as they navigate against risk. Value increases continuously, and incrementally as capitalization is realized in relation to those activities.

Early responses to the local-global equation looked to structural articulation in what became known as ‘matrix organizations that allowed for retention of rational-analytical choice models, with modified response through process-oriented incremental decision. More recent organizational approaches, and especially in capital intensive fields such as IT, offer support for the benefit of incremental decision making with the salient distinction between the form and function of decisions. Content in both cases is driven by challenges to productivity, and executive direction is now more than before forced to consider incremental decision making as strategic option, despite the fact that rational choice inevitably overrides constant reinvention (Tiwana, A. et al. 2006).

Responsive to the aforementioned challenges in the emergent healthcare environment, leaders looking to new IT HMIS operations systems are seeking change management solutions that will enable them to forge lean and agile strategic growth models in settings known for fiscal and resource waste.
Six Sigma approaches to analysis have allowed businesses to streamline operations through combined methodologies of analysis (Edgeman and Dugan 2008). In the past ten years there has been increased demand for seamless service between hospitals, clinics and multidisciplinary teams concerned with the wellbeing of patients and their families. Healthcare organizations seeking competitive and more efficient options to serving patients now look to IT Healthcare Management Information Systems (HMIS) for optimizing capacity both in terms of finance and in standard of care to patients (Tan and Payton 2010).

Despite the upfront costs of planning and implementation that go into introduction of new IT systems into an existing HMIS setting, integrated operations enable the advancement of fiscal and other controls not previously realized due to time lapse, as well as precision in every step of the service provision process from decoupling point between allocations to actual delivery of patient services. If efficiency in information is directly linked to ‘duty of a reasonable standard of care’ within hospitals and healthcare institutions, the benefits to those organizations in terms of direction and better control of liability issues through information channels, offers new promise in terms of comprehensive patient care through “patient-centric management systems,” and ultimately sustainable organizational growth (Tan and Payton 2010). The foregoing research proposal outlines the development of HMIS in the medical field of practice in the United Kingdom.

Literature Review

The 1990s marked the dawn of knowledge sharing systems in the space science industry, and the landmark mission deployed by NASA IT engineers in the development of what would come to be known as a Competency Management System (an online system that maps individuals to their competencies). Out of that seed project, the 2005 initiation of the NASA Engineering Network (NEN) was formed under the Office of the Chief Engineer in furtherance of the space agency’s knowledge-sharing capacity. Coinciding with a to benchmarked study with U.S. Navy, U.S. Army Company Command, the U.S. Department of Commerce, and Boeing Corporation, the NEN network enables “peers and experts through communities of practice, search multiple repositories from one central search engine, and find experts” (Topousis, D.E. et al. 2009). The research study follows this idea, and proposes to contribute to three (3) bodies of literature pertinent to the field of knowledge sharing: 1) General history of IT integration as change management strategy for advancement of purpose in science; 2) studies on the development of IT networks of practice within the health science community in particularly and the development of heath management information systems (HMIS); 3) literature dedicated to risk mitigation and compliance within legislative policy, and elements of security within institutional networks subject to oversight by chief information officers (CIO).

Invitation of recognized Technical Fellows noted in their discipline to facilitate their respective community of practice within the network set the pace for portal integration of human resource tools, such as jSpace. The platform can be utilized as communicator/research source for professional recruitment to projects and permanent roles. Links to related associations and professional societies offer participating fellows and partners access to an integrated contact source of engineers, “while fostering an environment of sharing across geographical and cultural boundaries.” The next step in NASA NEN is incorporation into the larger NASA Enterprise Search, and potential accommodation of oft requested ITAR-restricted information. The extension of the NASA space science knowledge sharing concept has done two things: 1) further the advancement of space science objectives through KMS (Knowledge Management Systems) and PMS (Plan Management Systems) toward design and launch of multinational space missions; and 2) extend the idea of an IT integrated field of scientific practice to other scientists in distinct fields of practice throughout the scientific community (Quattrone and Hopper 2004).

The emergent emphasis in organizational theory on IT Healthcare Management Information Systems (HMIS) as presented by Tan and Payton (2010), initiates query into the integration of extended practice setting networks. Interested in the advancement of IT platforms and software driven data bases as solution to change operations in global institutions, the search for approaches that succeed at meeting core competencies through risk reduction and resource maximization are the most sought after technologies for the betterment of the ‘total’ organization. The new IT systems offer interconnectivity between operational units within healthcare institutions, and link human intelligence to the logistics data analysis for in-depth insight into the history of expenditures and allocation requests. Some institutions have joined supply chain cooperatives in their region to further enhance the use of network logistics and stem of the flow of fiscal waste – a persistent concern within healthcare organizations – saving literally hundreds of millions of dollars annually (Healthcare Finance News, 2010).

Healthcare Management Information Systems (HMIS) offer integrated systems platforms and applications to the entire range of chain operations management activities within and between institutions that provide patient care. Consistent with the emergent interests in organizational knowledge sharing networks, healthcare institutions are looking to IT solutions for a number of reasons, and especially the growing impetus toward: 1) healthcare provider connectivity; 2) increased focus in tracking and management of chronic diseases; 3) heightened patient expectations regarding personal input in care process; 4) market pressures driving hospital-physician alignment; and 5) advances in the technological facilitation of systems operability in this area (Tan and Payton, 2010).

Design of systems architecture from institution to institution still varies, as data management and interconnectivity may be distinct and also subject to existing ‘legacy systems’ issues that might be incorporated in the new HMIS model. The core competency of HMIS is the more ephemeral side of systems planning which is the knowledge sharing path – where data and information become meaningful. The other key components to consideration of HMIS integration include: 1) the basic hardware, software and network schema; 2) process, task and system(s); 3) integration and inoperability aspects; and 4) user, administration and/or management inputs and oversight. For instance, IT HMIS designed to enhance the networking of financial operations in hospital institutions must be especially responsive to the growing complications in the US insurance industry as product options such as bundled claims force institutions into synchronous attention to patient’ demands. Convenience and competitive pressures to supply those services supersede mere fiscal allocation in service to patients amidst conglomerate interests in the healthcare industry (Monegain, 2010).

Chief Information Officers (CIO) are critical to the administration and planning of HMIS systems, and in particular, security measures and oversight of privacy protections. Unlike Chief Executive Officers (CEO) that serve as the primary responsible party for general governance, the CIO is more directly involved in the scientific praxis of organizational management; as precision in systems that retain data for record, and for analysis toward organizational growth are in their hands. CIOs are increasingly drawn into this external environment based on the nature of transactional relationships, as they are called upon to find IT systems of accountability within their own institutions (cio.com, 2010). Regulation of computer and telecommunications activities in the UK’s Computer Misuse Act (CMA) of 1990 has impact in regard to the stipulations pertaining to definitions of personal and professional use of HMIS by employees, partners and clients (Crown Prosecution Service Advice on CMA 1990).

Aims and Objectives to the study

The aim of the research is to study successful approaches to knowledge sharing, risk reduction and resource maximization through HMIS IT systemization. The most sought after technologies are those that expedite a ‘total’ organizational approach to information management. The goal of the research is to conduct a Six Sigma analysis of an IT based knowledge sharing infrastructure of a scientific community of practice. In spite of the nascent value of space science as a critical beginning to baseline assumptions the study proposes to survey the development of HMIS in the medical field in the United Kingdom. The three (3) core objectives to the study on healthcare IT infrastructure will be: 1) review of HMIS infrastructure as it is understood by healthcare administration in contract with systems engineers; 2) fiscal accountability is the second priority objective toward the goal of projected and actual capitalization on IT systemization in the practice setting; and 3) the significance of quality control of those systems in relation to government reporting and policy.

Methodological Consideration

Methodologies to the study will be implemented toward building a portfolio of practice on HMIS in the British healthcare industry based on data drawn from the following sources:

Survey of lead UK health institutions

The structured Survey instrument will be comprised of (50) questions and will be circulated in the HMIS practice community in the UK. A series of open queries at the end of the Survey will offer an opportunity to CIOs and IT administrators to contribute unique knowledge about their systems.

Interviews with CIO

Depth content to the research will be drawn from two (2) semi-structured Interviews with CIOs selected from information obtained from data generated in the Survey. Findings on the development of HMIS onsite in those chosen institutions will open up a new field of query into the actual challenges faced in planning, implementation and updated maintenance of architectural systems as new enterprise systems come on the market. Policy and procedure will also be discussed, as well as extended referral networks.
3. Internet Research
a. Patient Research. Review of patient interface with HMIS portals at lead organizations and community healthcare providers.
b. Aggregate Index. Research Data collected from healthcare industry indexes toward furtherance of trend analyses.
c. Risk Management. Recommended best practices, policy and security protocol toward risk management of fiscal information, institutional and staff privacy and non-disclosure of patient record will be investigated. Review of open source software as protective measure as well as sufficient firewalls, intrusion detection, and encryption.

Sources and Acquisition of Data

Acquisition of data on the study will be conducted in three phases: 1) Survey; 2) Interviews; and 3) Internet. Phases 1 and 2 will focus on CIO and other lead IT staff in selected UK healthcare institutions, and incorporate information from the two instruments, as well as augmentation of the research with information on engineer consultancy relationships that they have worked with, and institutional documentation on HMIS and unit databases. Phase 3 will be conducted consecutive to the latter two phases of the research toward supplementation of policy and other details to the project.

Data Analysis

Examination of standardized taxonomies to open source database repositories used in HMIS will serve to further data analysis: Customer Relations Management (CRM); Electronic Health Records (EHR); Enterprise Resource Planning (ERP); Personal Health Records (PHR); and Supply Chain Management (SCM) dedicated to total operations management control, patient referral and professional knowledge sharing (Tan and Payton, 2010). Analysis of data on the project will be based on a Six Sigma solutions oriented approach.

Table 1

Approach

Description

ITIL Area

Charter

Defines the case, project goals of the organization

Policy and Procedures

Drill Down Tree

Process Drill Down Tree

Engineering Process & Unit Oversight

FMEA

Failure Modes & Effects Analysis

Risk Assessment

QFD

Quality Function Deployment

Compliance

SWOT

Strengths, Weaknesses, Opportunities, Threats

Planning and Implementation (ongoing for future inputs)

Trend Analysis

Aggregate Narrative

HMIS industry trends

Table 1: Six Sigma methodologies for analysis of HMIS survey, interview and internet archive sources.

References

Computer Misuse Law, 2006. Parliament UK. Available at: http://www.publications.parliament.uk/pa/cm200809/cmhansrd/cm090916/text/90916w0015.htm#09091614000131
Crown Prosecution Service Advice on CMA 1990. Available at:
http://www.cps.gov.uk/legal/a_to_c/computer_misuse_act_1990
Edgeman, Rick L. and Dugan, J. P., 2008. Six Sigma for Government IT: Strategy & Tactics for Washington D.C. Available at: http://www.webpages.uidaho.edu/~redgeman/RLE/PUBS/Edgeman-Dugan.pdf
Hitt, Black & Porter, 1995. Management. Upper Saddle River: Pearson Education, Prentice Hall.
Jones, R.E., et al., 1994. Strategic decision processes in matrix organizations. European Journal of Operational Research, 78 (2), 192-203
Monegain, B. N.C. health system to launch bundled payment pilot. Healthcare Finance News, 22 June 2010. Available at: http://www.healthcarefinancenews.com
Quattrone, Paolo and Hopper, T., 2004. A ‘time-space odyssey’: management control systems in two multinational organizations. Accounting Organizations and Society 30, 735-754.
The imperative to be customer-centric IT leaders (2010). CIO.com. Available at: www.cio.com
Tan, J. and Payton, F.C., 2010. Adaptive Health Management Information Systems: Concepts, Cases, & Practical Applications, Third Edition. Sudbury, MA: Jones & Bartlett Learning.
Tiwana, A. et al. (2006). Information Systems Project Continuation in Escalation Situations: A Real Options Model. Decision Sciences, 37 (3), 357-391.
Topousis, D.E. et al., 2009. Enhancing Collaboration Among NASA Engineers through a Knowledge Sharing System. Third IEEE International Conference on Space Mission Challenges for Information Technology. Pasadena, CA: Jet Propulsion Laboratory.

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This essay will discuss three assertions: (i) that international law was not intended to deal with rights of individuals; (ii) that international law is not equipped to deal with rights of individuals; (iii) that individual rights should be the concern of domestic legal systems only.

We will deal with each of these in turn, with reference to international legal instruments and bodies. We will observe first of all how the rights of individuals, although falling outside the province of international law as it was conceived in the1600s, began to seep into the framework of international legal rules over the centuries, eventually coming to prominence during the ‘human rights era’ that followed the end of the Second World War. We will consider secondly the various mechanisms that have been put in place by the international community in order to deal with the enforcement and observance of individual rights enshrined in international legal instruments. Lastly, we will critically assess the claim that questions about individual rights should be the sole concern of domestic legal systems.

The scholars who laid the intellectual foundations of international law in the Western world, like Hugo Grotius (1625) and John Locke (1690), all stressed in their writings that legal systems, be they domestic or international, were founded in natural law and commonly accepted standards of (Christian)morality. It may seem surprising, therefore, that for centuries the rights of individuals played no significant role in the framework of international law. International law, as the name suggests, was the body of legal rules governing the relations between states – ‘the law of nations’. Nation states, and not individuals, were the ‘subjects’ of international law. The behaviour of a state towards individuals within its own territorial boundaries was governed by its domestic legal system. Any interference by one state in the internal affairs of another, for whatever reason, was viewed as a violation of state sovereignty, and as a threat to stability in international relations.

It did not take long for international law to begin to concern itself with the welfare of individual human beings. However, when this did start to occur it was not because human compassion and religious morality had risen to the foreign international relations; it was motivated rather by the reciprocal political and economic interests of states. An early concern of nation states was the manner in which their diplomats and other nationals were treated when residing and conducting their business in the territory of another state, as noted by Louis Henkin (1989):

Of course, every State was legitimately concerned with what happened to its diplomats, to its diplomatic mission and to its property in the territory of another State. States were concerned, and developed norms to assure, that their nationals (and the property of their nationals) in the territory of another State be treated reasonably, ‘fairly’, and the system and the law early identified an international standard of justice by which a State must abide in its treatment of foreign nationals.

Once such norms were agreed between two states, it was no longer possible for either of them to assert that the treatment of individuals within its borders was a matter exclusively to be dealt with by its domestic legal system, a point that was stressed in an Advisory Opinion on Nationality Decrees Issued in Tunis and Morocco (1923) of the Permanent Court of International Justice (the forerunner to the International Court of Justice).However, although the rights of individuals were thus ‘internationalised’ to a limited extent, the international agreements in question did not permit states to take action against any state that was deemed to be violating the rights of its own nationals. The position under international law in this respect began to change with the developing doctrine of humanitarian intervention.

First expounded by Hugo Grotius (1625), the doctrine of humanitarian intervention allowed for limited exceptions to the rule that states were prohibited from interfering with the internal affairs of other states for the benefit of individuals within those other states. This could be done to stop the maltreatment by a state of its own nationals ‘when that conduct was so brutal and large-scale as to shock the conscience of the community of nations’ (Stowell 1921). The doctrine has been much abused throughout history, and is often invoked as a pretext for the invasion or occupation of weaker countries. However, it shows that states were becoming concerned with the welfare of individuals even when this was not directly linked to political and economic interests to be derived at the state level.

As we moved into the nineteenth century, a new wave of concern for human welfare sparked changes within the international system. European and American states abolished slavery and the slave trade, and international agreements were put in place to govern the conduct of war between states in such a way as to minimise cruelty and brutality in international conflicts. The Hague Regulations (1899) sought to codify principles of customary international law that had developed over time in relation to land warfare, making provisions to outlaw certain weapons that had proved particularly destructive to individuals on the battlefield and civilians, and to protect the welfare of prisoners of war.

This could not stop the catastrophe that was to unfold in the course of the First World War, which claimed more lives than any conflict in the history of humankind. In the aftermath of the War, the Covenant of the League of Nations (1920) came into force. This established the League and served as its constitution. Although it contained no express provisions dealing with human rights, it marked a substantial step forward in terms of international law recognising the rights of individuals, in three important respects. Firstly it recognised the rights of individuals living in the colonial territories of the states that were defeated in the War, transforming these territories into League Mandates, and stating in article 22 that ‘the principle that the well-being and development of [the native] peoples form a sacred trust of civilization.’ Secondly, article 23 of the Covenant stressed the need for ‘fair and human conditions of labour for men, women and children.’ This was to pave the way for the creation of the International Labour Organisation under the Treaty of Versailles (1919). Many scholars,including Leary (1981) have stressed the importance of the ILO in improving the working conditions for millions around the globe, and in turn making a significant contribution to the development of international human rights law. Finally, the League of Nations established a system for dealing with the protection of minority groups within certain states. A series of special treaties were concluded for the protection of ethnic, linguistic and religious minorities in several countries in central and eastern Europe (Hannum 1990).These treaties were supported by a relatively sophisticated (and successful)system of enforcement, whereby a committee accepted petitions concerning allegations that minority rights had been violated, with the possibility of the Permanent Court of International Justice rendering an Advisory Opinion on the legal merits (Stone 1934). International law showed itself to be more than equipped to deal with the rights of individuals belonging to minority groups during a short period between the two World Wars. This success was to prove short-lived.

The events of the Second World War, and in particular the systematic extermination of over six million European Jews by Hitler’s Nazi Germany, were to shock the world’s conscience. The notion of human rights,never before made explicit under international law, was to find its way into the Charter of the United Nations (1945), which was ratified after the War by most members of the international community. Although the rights accorded to individuals under the Charter were not as extensive as some had hoped (Robinson1946), it nevertheless began its Preamble with the words ‘We the peoples’ of the United Nations – human beings, as well as nation states, had now become subjects of international law. Article 1(3) of the UN Charter states that one of the purposes of the UN is:

To achieve international co-operation in solving problems of an economic, social,cultural, or humanitarian character, and in promoting and encouraging respect for human rights and for fundamental freedoms for all without distinction as to race, sex, language, or religion.

Article 55(c) also stresses the need for the UN to promote ‘universal respect for, and observance of, human rights and fundamental freedoms for all.’ The UN Charter was followed in 1948 by the Universal Declaration of Human Rights, which draws on documents like the French Declaration of the Rights of Man and the American Declaration of Independence(Eide 1992). This instrument, which has proved a driving force in the human rights movement, proclaims in article 1 that ‘all human beings are born free and equal in dignity and rights.’ The Universal Declaration on Human Rights was followed in 1966 by the International Covenant on Civil and Political Rights (ICCPR) and the International Covenant on Economic, Social and Cultural Rights (ICESCR). These Covenants create binding legal obligations for the states that have ratified them. Henkin (1977) emphasises that these states are therefore no longer free to claim that the rights contained in the Covenants fall exclusively within their domestic jurisdiction. International law has come a long way since the days of Grotius; there can be no doubt that individual rights are firmly enshrined within its framework.

If individual rights are plainly part of today’s international system, the next question that falls to be considered is whether international law is ‘equipped’ to deal with individual rights. We observed earlier how the League of Nations put in place a system of enforcement and observance for the minorities regime that existed during the inter-war years, oversee ultimately by the Permanent Court of International Justice. Various other mechanisms exist within the international system, and they have enjoyed varying degrees of success.

One of the most successful human rights enforcement mechanisms is the Human Rights Committee established under the ICCPR. The Committee exists to ensure that states that have ratified the ICCPR comply with the obligations they have assumed under it. State parties are required under article 40(1) ‘to submit reports on the measures they have adopted which give effect to the rights recognised [in the Covenant] and in the progress made in the enjoyment of those rights.’ Under the First Protocol to the ICCPR, the Committee will also accept petitions from individuals alleging that their rights under the Covenant have been violated by a state that has ratified the Protocol. The Committee has developed an extensive body of jurisprudence,which serves as a valuable tool in helping with the interpretation of the rights under the Covenant (McGoldrick 1994).

Regional human rights systems have also shown that it is possible to enforce the observance of individual rights in an arena other than the domestic legal system of a nation state. The European Court of Human Rights hears applications from individuals in member states of the Council of Europe concerning alleged violations of the European Convention on Human Rights(1950), a document that draws heavily from the Universal Declaration of Human Rights. Since the passing of the Human Rights Act (1998) into UK law, the English courts are obliged to follow rulings of the European Court of Human Rights, which presents us with an interesting example of the interplay between domestic and international law in relation to the rights of individuals. Other regional bodies include the Inter-American Court of Human Rights and the African Commission for Human Rights. Although less prolific and powerful than their European counterpart, these bodies have demonstrated that it is possible to enforce individual rights under international law.

Many who argue that international law is not ‘equipped’ to deal with individual rights point to the so-called ‘non-justifiability’ of economic, social and cultural rights, as well as third generation peoples’ rights. They aim to show in other words that, by their very nature, such rights are not capable of being determined judicially, unlike the sort of rights that arise ordinarily within domestic legal systems. In the context of civil and political rights, the argument goes, the individual holds a clearly defined right against the state, the violation of which can be tested in a court of law. However, it is said that ‘economic and social rights are not suitable for judicial consideration because of the wide range of issues that have to betaken into account and the uncertainty surrounding effective means of achieving the ends in question.’ While Article 2(1) of the ICCPR states: ‘Each Party to the present Covenant undertakes to respect and to ensure to all individuals within its territory and subject to its jurisdiction the rights recognized in the present Covenant, without distinction of any kind,’ Article 2(1) of the ICESCR states: ‘Each State Party to the present Covenant undertakes to take steps to the maximum of its available resources, with a view to achieving progressively the full realization of the rights recognized in the present Covenant by all appropriate means, including particularly the adoption of legislative measures.’

However, the Committee that oversees the ICESCR has refuted the ‘non-justifiability’ argument. In its General Comment No. 3(1990), the Committee insists that Article 2 of the Covenant imposes concrete legal obligations, requiring states to realise minimum standards relating to each of the rights, utilising available resources in an effective manner. It follows therefore that although economic and social rights under international law may be different to the sort of rights that are normally found within a domestic legal system, that is not to say that they are not capable of enforcement. Methods of enforcement do need to become more effective, but several international bodies have shown that they are equipped to perform this role, often with very positive results.

We finish by dealing with the assertion that questions about individual rights should be the concern of domestic legal systems only. We can safely dismiss this assertion as ill founded with the help of an unlikely source: Hermann Goering, during the Nuremberg trials that took place in the wake of the Second World War, exclaimed: ‘But that was our right! We were a sovereign state and that was strictly our business.’ Germany’s sovereignty, in Goering’s view, shielded individuals involved in the atrocities of the Holocaust from accountability.

When domestic legal systems (like that in Nazi Germany)fail to prevent the murder and ill treatment of prisoners of war, murder and ill-treatment of the civilian population and a policy of slave labour and persecution and murder of Jews, it is right that the international community should step in to protect the rights of the individuals concerned. There can be no doubt that the international system is often ill-equipped to deal with atrocities that occur within state borders; the genocide in Rwanda in 1994 is a case in point. However, that is not to say that we should not keep striving to perfect the systems that do exist under international law. It may not have been conceived to deal with such issues, but international law has evolved into a corpus of rules with huge potential as a mechanism for the enforcement and protection of individual rights. Nation states would be wise to build on this potential rather than ignore it.

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Introduction

Rewards can be defined as the compensations and benefits received by an employee in exchange for their services (Torrington Et al, 2014). Remuneration forms an important subset of the total rewards and comprises of those elements that can be valued in monetary terms (Jiang Et al, 2009). Effective remuneration strategy often underpins the success of the business as it is considered as one of the key factors to attract and motivate human capital. Herzberg (1993) asserts that inadequate remuneration is one of the key factors causing dissatisfaction amongst employees.

The term remuneration is often associated with basic pay. However, remuneration is a much broader term and can encompass a wide range of techniques for rewarding employees in the form of salaries, bonuses, piece based remuneration, commission, employee stock options, fringe benefits, deferred considerations, performance related pay and profit sharing amongst many others (Torrington Et al, 2014).

One of the major challenges for organisations in the contemporary business environment is that of employee motivation. Motivation can be defined as ‘the degree to which individual wants and chooses to engage in certain specified behaviour’ (Mullins, 2002, p.418).

The purpose of this essay is to critically examine various methods of employee remuneration and assess its role in strategic management of human resources for an organisation by shedding light on its key advantages and disadvantages. The essay will finally conclude by analysing if a particular method of remunerating employees fits all situations or is preferred over other means of remuneration.

Different methods of remuneration
Performance related pay scheme:

As the name suggests, performance related pay schemes reward employees by linking the level of reward with the performance of the employees (Perry, Engbers, and Jun, 2009). Typical examples of performance related pay include bonuses, commissions and deferred considerations. One of the key advantages of performance related remuneration is that it provides an effective means of rewarding by distinguishing between good and poor performers (Torrington Et al, 2014). Other advantages of performance related pay are increased motivation amongst employees to improve performance, attract and retain high performers and talented individuals, and ultimately improve corporate performance (Torrington Et al, 2014).

Nonetheless, empirical evidence highlights that the performance related pay has often been ineffective (Frey and Osterloh, 2012). Frey and Osterloh (2012) also highlight that the link between the increases in performance related pay and corporate performance has remained weak. Performance related pay is also criticised for inciting employees to take dysfunctional decisions, as it acts as an inducement for employees to take greater risks which could put an organisation’s survival at stake (Frey and Osterloh, 2012). Performance related pay may also lead to conflict of interest for the employees by inducing them to focus exclusively on areas that impact their pay and ignore other important tasks that may be in the long term interest of the company. Performance related pay might often supress the intrinsic motivation of employees (Frey and Osterloh, 2012, p.2). Amabile (1998, p.79) asserts that intrinsic motivation reflects employees passion and interest in work, which has a stronger impact on the performance of an employee and the business. Lastly, Maslow’s theory of motivation elucidates that within every individual there are hierarchy of five needs – basic physiological needs, safety needs, belongingness needs, esteem needs and self-actualisation needs (Maslow, 1943). Maslow asserts (1943, p.363) that the needs lower than the self-esteem needs can be accomplished through remuneration, whereas the higher level needs of esteem and self-actualisation for the senior management are unlikely to be achieved through extrinsic rewards, such as performance related pay. Thus, it may not act as a motivational factor for the senior management.

Profit Sharing

In the contemporary times, increased numbers of business organisations have started linking the level of remuneration offered to the employees with the profits of the organisation (Torrington Et al, 2014). Stock options are a common example of this type of remuneration. One of the key advantages of this remuneration policy is deemed to be higher level of commitment by the employee towards the company because of increased level of mutual interest (Torrington Et al, 2014). Other common advantage of profit sharing schemes is deemed to be change in attitude of workers due to increased sense of belongingness with the company (Rappaport, 1999). Amabile (1998) asserts that feeling of increased sense of belongingness leads to intrinsic motivation which has a more direct and stronger relationship with company’s performance.

However, Empirical evidence highlights a lack of evidence of relationship between this type of remuneration and performance of the company (Rappaport 1999). One of the key criticisms of this type of remuneration is that any improvement in company’s performance will reward both good and bad performers, resulting in poor motivation for high performers as they may feel that part of the reward that they deserve is being enjoyed by the low performers (Rappaport 1999). Furthermore, sometimes profit based remuneration policies might fail to motivate the employees as they often feel share prices are undervalued despite of business outperforming the forecasts (Rappaport 1999). Lastly, Kohn (1993) argues that shareholders expect the board to reward employees when the company has outperformed the market. However, empirical evidence highlights that for executives to exercise the option profitably, the performance of the company need not be superior and executive can easily benefit in the times of rising market (Rappaport 1999). Thus, if employees feel that the movement in share prices are independent of their performance, there is a risk that profit based remuneration scheme may not act as motivational factor.

Piece Based Remuneration

Piece based remuneration scheme is historically one of the most commonly used incentive schemes in practice for manual workers and is based on the number of items they produce or the number of hours worked by them (Torrington Et al, 2014). Typical examples of piece based remuneration schemes include individual time saving scheme, measured day work schemes, group incentives, plant wide bonus schemes and commissions (Torrington Et al, 2014). Advantages of such schemes typically include increased level of control by the management over the production process and it also acts as a cost control measure because the workers main goal is to do the task expediently and efficiently in order to achieve the goal (Kohn, 1993). Furthermore, Maslow’s theory of motivation (1943), as mentioned above, highlights that extrinsic rewards, such as piece based remuneration, might act as a motivational factor for manual workers because these workers are likely to have the lower level needs as per Maslow’s theory.

Like other types of remuneration, piece based remuneration has its own set of disadvantages. Remunerations such as group incentives and plant wide bonus schemes lead to additional pressure on employees and create interpersonal animosities because of high performers not being able to receive the incentives due to some low performers in the group (Torrington Et al, 2014). Furthermore, time saving schemes and measured day work schemes may act as a deterrent to creativity, as individual employee’s focus is on standardisation and predictability in order to complete the work in the minimum possible time (Kohn, 1993). Herzberg (2003) motivation hygiene theory suggests that job satisfactions and job dissatisfactions are two independent experiences. Whilst extrinsic rewards, such as piece based remuneration, can help the manual workers to avoid job dissatisfaction, it might not lead to job satisfaction as the employees are not intrinsically motivated by the work itself.

Skill Based Pay

This is a remuneration policy where employees are remunerated based on the skills and competencies they possess (Armstrong, 2002). One of the biggest advantages of skill based remuneration is that it promotes employees to acquire multiple skills, thereby, offering flexibility to the organisation in terms of using same employees for various purposes and responding to customer needs more efficiently (Torrington Et al, 2014). Such remuneration schemes also enable organisations to attract and retain skilled employees easily compared to their competitors as people are likely to be rewarded appropriately for the skills they possess under this scheme (Torrington Et al, 2014).

Potential disadvantages with this scheme is that costs often outweighs the benefits if the increase in productivity is not enough to compensate the increased cost of hiring and training skilled employees (Armstrong, 2002). As business operates in a dynamic environment, there is a risk of skills obsolescence and associated high cost of training. Lastly, the business might also bear the risk of losing a skilled employee, on whom the business has invested a significant amount in training, to a competitor due to a highly competitive labour market (Torrington Et al 2014).

Flexible and Fringe Remuneration

Fringe benefits can be defined as the benefits in kind provided to the employees and have substantially growth in the recent years (Armstrong, 2002). The value of the fringe benefits paid to the employees reflect approximately twenty to fifty percent of the remuneration and typically includes benefits like pensions, company cars, sick pay, private health insurance, mobile phones, staff discounts, maternity or paternity pay, creche facilities and relocation expense amongst many others (Torrington Et al, 2014).

Flexible benefits provide options to the employees to decide how their remuneration should be structured (Torrington Et al, 2014). Under such schemes, the gross value of the remuneration package is determined by the employer; however, the employees have the flexibility to choose the mix of cash and other benefits as a part of remuneration package (Dychtwald, Erickson, and Morison, 2006). Examples of flexible benefits include the option to choose between additional holidays, access to company creche, childcare vouchers or cash, amongst many others. The advantages of flexible benefits include the potential of increased employee motivation as they end up getting the rewards they desire. Savings in social security taxes could also be made through comprising the salary for the desired benefits that might attract a lower level of tax (Thomsons, 2015). Furthermore, research has highlighted that flexible remuneration programs contribute to attracting new employees, improve retention of existing employees and improve employee engagement (Thomsons, 2015).

The primary disadvantage of flexible benefits remuneration schemes is increased cost burden for the employer due to rise in the amount of administrative work related to managing the individual choices of employees (Armstrong, 2002). Another criticism of flexible remuneration policy is that the expensive company cars and glamorous lifestyle provided to employees have contributed little towards developing long term commitment towards the business organisation and retention of employees (Thrope and Homan, 2000). Empirical evidence highlights that the employees do not completely understand the value of the flexible benefits and there is little evidence of the positive motivational impact of these remuneration policies on the employees (Torrington Et al, 2014). Nonetheless, it does not indicate that employees do not value the presence of these benefits and are likely to resist their removal (Torrington Et al, 2014).

Conclusion

Based on the discussions in the sections above, it is evident that each method of remunerating employees has certain advantages associated with it. However, Maslow’s theory of motivation and Herzberg hygiene factors, as discussed above, have highlighted a common issue across all forms of remuneration, i.e. the extent to which extrinsic rewards can contribute to motivating an individual employee, thereby, improving the company’s performance. Kohn (1993, p.1) asserts that whether remuneration is performance based, profit based or piece based, it might motivate employees in the short run, but would not contribute to long term commitment towards the company.

Nonetheless, it is not deniable that remuneration plays an important role in influencing employee’s decision regarding the long term commitment towards the company. However, no one method of remuneration is deemed to be recommended over another method and a business might use a combination of methods to remunerate the employees according to the needs and motivations of the employees. Employees at lower level might be motivated by the prospects of better remuneration through different tools; however, for senior management self-esteem and self-actualisation needs would need to be satisfied in order to motivate them. Thus, rewards needs to be carefully crafted to support one another and incorporate both financial and non-financial remuneration.

References

Armstrong, M., 2002, Employee Reward: People and Organisation, Chartered Institute of Personnel and Development, pp. 410 – 420

Dychtwald, K., Erickson, T., and Morison, R., 2006, Flexible Compensation and Benefits: Why Variety Will Rule and How to Leverage it, Harvard Business Review, pp. 1 – 9.

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Introduction

The concept of scientific management, developed by Frederick Winslow Taylor, revolutionised many workplaces, increasing efficiency and control for employers while concurrently lowering costs (Buchanan and Huczynski, 2011; Grachev and Rakitsky, 2013; Taylor, 2012). Taylor’s book “The Principles of Scientific Management”, has been identified as the most influential management book of the twentieth century (Bedeian and Wren, 2001). However, despite the benefits for employers, and popularity of the idea, implementation was often associated with poor outcomes for employees, including lowering job satisfaction, increased attrition, and low levels of motivation (Parker, 2014; Pettinger, 2010). However, despite the perceived negative effects, scientific management remains popular (The Economist, 2015; Parker, 2014; Vidal, 2013). This paper examines and evaluates the concept, and then applies it to a modern organisation; Microsoft.

The Concept of Scientific Management

The development of scientific management was based on previous ideas regarding workplace efficiency which emerged during the Industrial Revolution (Buchanan and Huczynski, 2011). Prior to the Industrial Revolution, labour division was based on skills and knowledge, with craftsmen having a significant level of discretion regarding how a task was performed or job completed (Buchanan and Huczynski, 2011). The Industrial Revolution changed workplace practices, with the division of labour, where individual employees are given responsibility for a predetermined portion of any task (Buchanan and Huczynski, 2011). The economist Adam Smith credited this division of labour as creating the UK’s wealth, developing the concept of “economic man”, believing workers primary motivation was money (Smith, 1904). Charles Babbage referred to this as “The Great Principle of Economical Reproduction” (Buchanan and Huczynski, 2011; Smith, 1904). However, while this division of labour created efficiencies, Taylor believed further efficiencies remained, and while workers still retaining performance discretion they could use it to their advantage (Grachev and Rakitsky, 2013; Taylor, 2012).

Taylor’s approach improved efficiency was based on the standardisation of job design, breaking jobs down into component tasks, with performance requirements based on scientific studies identifying the most efficient workplace practices (Taylor, 2012). This approach increases the level of management control, reducing reliance on worker skills and discretion. By breaking jobs down into their smallest components, employers could hire and train cheaper, unskilled workers, replacing them as necessary (Buchanan and Huczynski, 2011; Pettinger, 2010). Child (1972), referred to this process of job design as the 3 S’s, specialisation, standardisation, and simplification.

The focus of job design was based on the task assessment, examining the best way any individual task could be performed (Grachev and Rakitsky, 2013; Taylor, 2012). This was seen at the Bethlehem Steel Works, where a study of the workers shovelling pig iron resulted in a job redesign reducing the number of workers required from 500, to 140, without productivity loss (Taylor, 2012). The workers that remained benefited from higher wages based on performance-related pay; wage increases of approximately 60% followed the implementation (Taylor, 2012). However, this did not mean his methods were welcomed by workers, in addition to creating redundancies, there was resistance to the change, also evidenced earlier at Midvale Steelworks (Grachev and Rakitsky, 2013). When Taylor first introduced scientific management approaches at Midvale, initially workers purposefully broke machines to resist work standardisation (Grachev and Rakitsky, 2013). Taylor overcame resistance by fining workers for broken machines, using an application Smith’s “economic man”, which appeared to work, as resistance decreased as workers complied to avoid the fines (Grachev and Rakitsky, 2013). Effectively, Taylor was treating workers as components of a production process, dehumanising them, considering only their labour input and labour output.

The resistance seen at Midvale steelworks was not isolated. A significant factor in the uptake of scientific management was the implementation at Ford, resulting in productivity increasing exponentially (Buchanan and Huczynski, 2011; Taylor, 2012). However, worker dissatisfaction also increased and attrition levels reached 400% (Buchanan and Huczynski, 2011). Again, using the concept of economic man, Taylor overcame this problem by introducing a $5 day, paying workers $5 for each day worked (Buchanan and Huczynski, 2011).The $5 day was successful, and workers remained, adopt an instrumental approach (Buchanan and Huczynski, 2011). It may be hypothesised, that if the implementation at Ford had been less successful, the idea may not have gained such wide scale support.

The concept of scientific management has continued in the modern workplace, not only in traditional manufacturing sectors, but many new sectors, e.g. call centres and fast food outlets (The Economist, 2015; Buchanan & Huczynski, 2011). If implemented, in line with the above findings and previous experience, it may be expected workers in these jobs would be dissatisfied, due to the dehumanisation processes demonstrated as present in scientific management techniques, such as Midvale and Ford. However, frequently dissatisfaction does not manifest. In research undertaken at the Vauxhall car manufacturing facility in Luton, Goldthorpe et al., (1980) found work conditions, based on scientific methods, were poor, with little opportunity for discretion, and a high level of disempowerment. However, with higher than average pay, the researchers found that workers remained motivated, adopting an instrumental approach, gaining satisfaction from utility provided by wages (Goldthorpe et al., 1980).

It may also be argued, that although implemented in a fashion which appears dictatorial and dehumanised, that Taylor may not have intended this approach. When describing the concept of scientific management, Taylor argued that although governed by rules developed through experimental processes, there should not be an old-fashioned dictator (Taylor, 2012). Furthermore, he also believed workers and management should operate in hearty cooperation (Taylor, 2012).

When examining modern implementations, additional knowledge and subsequent motivation research, facilitate implementation processes more aligned with Taylors’ idealistic cooperative concept, rather than rigid implementations. For example, under the human relations school of thought based on research of theorists such as Mayo, Maslow, and Herzberg, it was found social influences and desires impacted on motivation (Buchanan and Huczynski, 2011; Herzberg, 1968; Maslow, 2014). Strategies satisfying these needs/desires, include work variety to induce interest, empowerment demonstrating trust, and other enrichment strategies (Buchanan and Huczynski, 2011). If social satisfaction strategies can be used to improve working conditions and worker motivation where scientific methods are utilised (The Economist, 2015).

With a high level of potential value in terms of creating internal efficiency, as well as providing for consistent practices and standards, it is unsurprising that the practice still continues. However, in organisations that need to both operate on a massive scale, as well as support practices associated with innovation and change, not generally associated with scientific management, the question is whether or not this management concept is still relevant.

Scientific Management and Microsoft

Microsoft, founded in 1975, is a U.S.-based multinational technology organisation based in Washington. The basic operations include the development, manufacturing, licensing, and support of computer software, electronics, and the provision of computer services (Microsoft, 2015). The company, which is the world’s largest software organisation, offers a range of products and services to both the consumer and businesses, with the most well-known products and services including the Windows operating system and associated software, such as the Microsoft Office Suite, with additional interests technology and Internet-related businesses, including the acquisitions of Skype and Nokia, a presence in the game industry with the development of the Xbox (Microsoft, 2015). An initial consideration of the scope and range of products, and the pace at which they change, indicates the need for adaptability and innovation (Dodgson et al., 2008). Innovation may not inherently be associated with scientific management, the process requires those involved to undertake original thought, and non-standardised approaches towards identifying developing new ideas (Dodgson et al., 2008; Kontoghiorghes et al., 2005; Ziesak, 2009). In this context, applying the scientific management processes, as defined by Child (1980), would be a constraint on the potential development of new ideas, which would potentially hinder Microsoft as many of their competitive strategies are based on differentiation through first mover advantage (Nicholson, 2014). Therefore, in some areas it would appear that it is unlikely scientific management is taking place, especially in areas where there is a need for original thought innovation. However, it may be noted that in areas such as research and development, where innovation is important, there is the concept of specialisation, as the development teams conceive and undertake initial development only, with later development and manufacture undertaken elsewhere (Microsoft, 2015).

However, while there is a need for the organisation to adapt to change, the organisation is also required to provide a high level of standardised products and services, where workers operate in the same manner, to provide the same output, a process which is highly associated with scientific management. Therefore, in some areas of the organisation scientific management will be applicable. For example, the company operates a number of call centres, and while a number are outsourced, there are also some provided in-house in the United States (Thibodeau, 2010). The processes utilised within call centres are invariably based on scientific management, where the components of dealing with customer issues are broken down into component parts, with various employees focusing on different issues, and providing advice only on specific areas, based primarily on scripts rather than their own knowledge, with comprehensive scripts developed by the company (Thibodeau, 2010). Unsurprisingly, the approach adopted, with the provision of scripts to guide the customer support process, is based on the company’s own customer care framework, a software solution designed for medium to large enterprises, facilitating dynamic scripting based on customer responses (Microsoft, 2015). Therefore, within these type of operations it is clear that scientific management processes may be used, although, based on the reviews of Microsoft as an employer on the job review site “Glass Door”, it also appears that the organisation adopts the concept with in a modern interpretation, with different elements of empowerment and support motivation, as job satisfaction does not appear to be low (Glass Door, 2015). The conditions in the outsourced sector also display the characteristics associated with scientific management, but with the lower labour costs, higher cost savings, and higher levels of attrition with in outsourced suppliers (Thibodeau, 2010), the implementation of scientific management techniques are more likely to be based on the traditional rigid approach, rather than implementing the empowerment strategies, and embracing the concept of hearty cooperation. Similar arguments may be made for the presence of scientific management in many of the manufacturing processes, although notably these are outsourced to third-party offshore suppliers (Microsoft, 2014).

Conclusion

There is little doubt that scientific management is thrives in 21st-century, adopted by many organisations. The method of management may not be found across all areas of large organisations, it does appear to be a concept which is applicable Microsoft, particularly in the areas where there needs to be standardisation of products and/or services, such as the call centres. However, internally within the organisation, not at the outsourced suppliers, it is not the original rigid approach towards scientific management is implemented, but a softened with the provision of enrichment strategies. This is a version of scientific management in which employees are not seen as only motivated by economic interest, but also by social interest, effectively embracing the ideas of Mayo, Herzberg, and Maslow, as well as the ideas of Taylor. Therefore, scientific management may be seen as applicable at Microsoft, manifesting in different ways across different divisions.

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Introduction

The professional services sector is largely comprised of highly skilled, specialist knowledge workers, with an array of qualifications, expertise and experience (Suddaby, Greenwood and Wilderom, 2008). According to Newell, Robertson, Scarbrough and Swan (2009, p. 18), knowledge workers, also known as gold collar workers, are “individuals with a high level of education and specialist skills, combined with the ability to apply these skills to identify and solve problems”. It is these characteristics of knowledge workers that creates both opportunities and challenges for the Human Resources (HR) functions of professional services organisations. The highly skilled nature of knowledge workers makes them very attractive to organisations seeking to deploy their human capital for strategic advantage (Kelly, Mastroeni, Conway, Monks, Truss, Flood, and Hannon, 2011). At the same time, knowledge workers are less apt than their less skilled counterparts to remain in one position for an extended period of time (Vaiman, 2010). Scarbrough (1999), for instance, suggested that one of the most salient characteristics of specialist, skilled professional workers is their lack of an occupational identity. This makes them organisationally and occupationally fluid, which creates a retention challenge for HR managers. With this context in mind, this paper identifies strategies that a growing professional services organisation could use to attract and retain highly skilled workers. The strategies that are highlighted are predicated on the assumption that professional services organisations are not able or willing to use pecuniary reward as a means of increasing their appeal to these specialists.

Recruitment is concerned with the set of processes utilised by business organisations to identify a sufficient pool of candidates from which they can select an employee (Wilton, 2013). However, recruiting is not as straightforward as it might seem. There are a plethora of methods and strategies that organisations can use in order to increase their appeal to job hunters, and thereby increase the pool of talent from which they are able to apply their selection procedures (Hiltrop, 1999). What is important is that the recruitment policies, practices and procedures are carefully designed with the needs of both the organisation and the candidates in mind.

This question about the optimal design of recruitment and hiring practices was considered by Horwitz, Heng and Quarzi (2003). Those authors conducted a survey of Chief Executive Officers (CEOs) and HR directors in a range of organisations that rely on a highly skilled and specialist workforce. The research identified two key strategies that the companies used for attracting skilled workers: carefully designed recruitment strategies and the provision of opportunities for career and talent development. Of the recruitment strategies that were utilised most effective strategies were the use of targeted media advertising, and, to a lesser extent, the use of headhunters (Horwitz et al, 2003). The authors suggested that targeted media advertising is more effective than general advertising because candidates for specialist roles are characterised by occupational fluidity and are therefore more likely to keep an eye on the job market by scanning the recruitment media that are specialist to their roles. Headhunters and other specialist external recruitment agencies are also likely to have access to large databases of potential candidates, many of whom they may have aided in finding work before (Wilton, 2013). The professional services firm may therefore find it easier to identify and locate a pool of suitable candidates for its specialist roles if it outsources its search and hiring activities to an agency that specialises in such activities.

Importantly, research suggests that the organisation needs to take into account the nature of the external business environment in designing their recruitment strategies. In particular, the extent to which there exist a tight labour market is vital (Wilton, 2013). A tight labour market is one in which there is intense competition for a relatively short supply of workers, and skills shortages exist. This is certainly the case in the professional services sector (Hor and Keats, 2008). Where a tight labour market exists, a firm may be required to adopt more creative recruitment and hiring practices. One way of overcoming the challenge of recruiting highly skilled professional workers would be to extend the reach of the search (Vaiman, 2010). One of the key features of highly skilled, specialist knowledge workers is their geographical mobility. Since these ‘gold collar workers’ apply their intellect and intelligence rather than their physical labour to work activities, they are also able to work remotely (Vaiman, 2010). This means that a professional services firm that is struggling to identify appropriate workers locally might be able to find skilled candidates by extending the search in geographical terms (Richardson, McBey and McKenna, 2008).

Interestingly, one of the most effective ways to attract skilled workers identified in the Horwitz et al (2003) research is for the firm to have a “reputation as an employer of choice” (p. 32). Reputation is thought to be an important factor in enhancing attractiveness for reasons relating to both the labour market as well as to the characteristics of the knowledge workers (Sutherland, Torricelli and Karg, 2002). First, a good reputation enables an employer to gain a competitive edge when it is competing for scarce talent in a highly competitive labour market. Second, because of their skills and abilities, knowledge workers are in a good position to be selective in their choice of employer. A good reputation, particularly in terms of working conditions is one way in which a growing firm can attract candidates from their rivals. Giauque, Resenterra and Siggen (2010) see reputation as particularly important to young professionals, because these individuals are sensitive to the way in which their own image is projected, and view their own image as reinforced and reflected by the corporate image. For this reason, “knowledge workers, very mobile and anxious to retain an important employability, will therefore invest more sustainably in a prestigious organization rather than in an organization that does not enjoy a positive image” (Giauque et al, 2010, p. 190). The HR function has a key role here in ensuring that working conditions are organised and arranged in such a way as to support the development of the firm’s reputation as a good employer (Wilton, 2013). This will include such aspects as managing the relationship between the employees and the employers (through aspects such as ensuring that conflicts are resolved adequately or enhancing employee voice), developing, managing and coordinating appropriate reward packages, providing training and development initiatives and interventions and ensuring safety and wellbeing (Wilton, 2013).

Strategies to aid retention of highly skilled specialists

Empirical research suggests that the way in which work activities are designed should be commensurate with the nuanced needs of specialist skilled workers (Newell et al, 2009). Since highly skilled professionals tend to rely on their intellect and expertise in the performing of their workplace tasks and activities, they may demand and require less in the way of workplace monitoring and control, and greater autonomy (Holland, Hecker and Steen, 2002). Indeed, there is some evidence that granting skilled workers autonomy over the way in which they approach their organisationally designated tasks can lead them to be more committed both to their jobs and to their employers (O’Donohue, Sheehan, Hecker and Holland, 2007). This could include delegating these workers managerial control over tasks and activities or allowing them flexibility and mobility in terms of their work schedules. Furthermore, skilled workers seem to prefer to work in organisations with flatter organisational structures, for these are facilitative of trust-oriented relationships and hierarchical structures undermine their need for autonomy (Newell et al, 2009). The new, Strategic Human Resources function can help to support job design and organisational (re)structuring because of its role as a strategic business partner (Teo, Lakhani, Brown and Malmi,2008). The design of work should be considered as a key HR practice that supports the achievement of the organisation’s goals. More specifically, it is recommended that the organisation offers its skilled workforce autonomy and control over their mandated tasks and activities, and that the organisation moves towards a flatter structure if it is serious about wishing to retain its specialist workers.

Alvesson (2000) has argued that while knowledge workers may not necessarily have an occupational identity, they do have a professional identity and seek communitarian and peer collegiality through their employment choices. This suggests that skilled workers that are provided with a sense of belonging will be more likely to remain with the organisation and resist the enticements of the firm’s competitors (Alvesson, 2000). There are a number of ways in which the development of a social and professional identity can be supported through HR initiatives. First, skilled workers can be supported to join and progress through the ranks of relevant professional bodies or learned societies (Hor and Keats, 2008). This might mean paying membership fees, providing workers with time off so that they are able to take up learning and training programmes, or providing internal training to support workers’ upskilling ambitions (Newell et al, 2009). Benson and Brown (2007) add that supervisor and co-worker support are key to the development of peer collegiality, and reducing turnover intentions. Co-worker support can be stimulated by the organisation of workers into teams, as appropriate to the task, and providing workers with adequate training to undertake team-based work whilst maintaining individual levels of autonomy. Supervisor support can also be encouraged through the careful design of line manager training schemes.

Aside from salary, the aspect of work that was identified in the Horwitz et al (2003) research as making the greatest contribution to knowledge workers’ organisational commitment were opportunities for promotion and personal and professional development. As Giaque et al (2010, p. 191) note, “a willingness to develop skills, whether by means of training or other career development activities, indicates to employees that the organization considers its human capital to be a source of competitive advantage”. Offering skilled workers the ability to engage in continuing professional education serves two purposes. First, it communicates to the employee the desire on the part of the company to forge long term relationships with the employee (Giaque et al, 2010). Second, it communicates to the worker the notion that the employer is supportive. Both aspects are thought to enhance feelings of commitment and loyalty on the part of the worker and may prevent them from defecting to competitors.

Finally, developing an organisational culture that is conducive to information sharing is thought to bring about enhanced organisational commitment in knowledge workers (Benson and Brown, 2007). To a greater extent than their traditional blue or white collar counterparts, gold collar workers rely on readily available information in order to undertake their work because they tend to work autonomously and exert greater control over decision making (O’Donohue et al, 2007). In addition, a culture in which information is easily disseminated creates a climate of trust, confidence and respect, which is known to facilitate affective attachment in highly skilled workers (Giaque et al, 2010). Thus, HR policies and practices should be designed in such a way as to stimulate information sharing in order to prevent loss of specialised workers to competing firms.

Conclusion

To conclude, recruiting and retaining highly skilled gold collar workers is increasingly difficult as the rate of growth of the professional services sector of the economy appears to be outstripping the rate at which individuals are acquiring and accruing the skills necessary to sustain it. In this climate, it is vital that firms identify and deploy strategies designed to attract highly qualified suitable candidates to the organisation, and put into place policies, practices and procedures that will engender those workers’ loyalty and commitment once they are there. Drawing on the extant literature in Human Resource Management, this paper has identified a number of strategies and methods available to professional services organisations including enhancing the firm’s reputation, outsourcing recruitment activities, developing the corporate culture and offering these vital workers opportunities for upwards progression and development.

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Introduction

Organisations and managers are now using a number of appraisal methods in order to assess employee performance, and these methods both have benefits and negatives. An employee performance appraisal is a critique and a review of an employee’s performance during the year, or another specified time period (Woods, 2003). Performance appraisals are one of the most important processes for successful businesses, and are one of the key metrics a human resource department within an organisation will be judged on (Kressler, 2003). Performance evaluations and appraisals have been conducted since the times of Aristotle, and the measurement of an employee’s performance can allow a company to take rational decisions on an individual employee level, when reflecting on their performance (Virginia Tech, 2010). Employee performance appraisals provide a structure for managers and employees to meet and discuss performance with each other (Lotich, 2014). Jafari et al., (2009) assert that performance appraisal is one of the most important processes that the human resource department has to implement.

Indeed, “there is little disagreement that if well done, performance measurements and feedback can play a valuable role in effecting the grand compromise between the needs of the individual and the needs of the organisation” (Virginia tech, 2010). Companies need to understand the purpose of appraising performance. This is to motivate an employee to increase their performance levels by attempting to help the employee understand why they are not performing effectively. It is also to identify how they can perform better (Kokemuller, 2012). This essay will look at a range of different employee performance appraisal methods, ranging from rating scales to team and self-evaluations. Both the benefits and the limitations of these will be looked at, in order to assess how effective they are as performance appraisal methods. Finally, the conclusion will discuss if there is one effective method that organisations should use, or if this is not the case.

Rating Scales

One method of appraisal is rating scales, and this is one of the more common forms of performance appraisal found within organisations (Jafari et al., 2009). Two of these which are commonly used are the graphic rating scale as well as the behavioural rating scale. Using the graphical rating scale, the employees are assigned a score based upon different criteria which are important to job success (Kokemuller, 2012). The behavioural scale focuses on the actual behaviours an employee displays. The benefits of rating scales is the fact that they are easy to use and to understand. Many managers and employees are also familiar with this technique, and they offer a simple way to communicate areas of strengths and weaknesses to the employee (Kokemuller, 2012). The graphical rating scale is not very time consuming at all, and they are easy to develop and administer as well as allowing for a range of quantitative analysis. Negatives of rating scales is the assumption that they are tied to a raise or a bonus for the employee, and this can contribute towards score inflation. Managers can also have a negative bias towards employees when utilising this method too (Kokemuller, 2012).

Narrative Techniques

Another technique is the narrative technique, which is similar to the critical independent method. When compared to the rating scales technique, these offer a more detailed analysis of job performance (Kokemuller, 2012). In these, an essay assessment is written of the performance for the narrative technique, with a log kept for the critical independent method. This log is based on the critical incidents which occur over the year, or the period of time the performance appraisal focuses on, and looks to the actual performance as opposed to behaviours like the essay technique (Jafari et al., 2009). A benefit of these techniques is the amount of detail, and how thorough they can be in analysing the behaviour of employees (Kokemuller, 2012). Maintaining a detailed set of notes throughout the year enables a manager to give a well-rounded and an accurate account of employee performance (Root, 2011). As well as this, there can be a focus on praising positive behaviours, as well as addressing areas where correction is needed. However, this thoroughness and scope for wide ranging discussion does leave the analysis up for open interpretation without a scoring and rating system, and therefore the employee may interpret the evaluation in a too positive or too negative light (Kokemuller, 2012). This method can be used in conjunction with other methods, such as the graphical scale, to enable something more quantitative with a qualitative rating too (Jafari et al., 2009).

Comparison Methods

Comparison methods is a multi-person method, which is a common appraisal technique. This approach, and the forced distribution method, compare the employee’s performance to the fellow workers within the organisation (Kokemuller, 2012). This allows the manager to communicate to an employee where they are performing well, and where they are not performing well in comparison to the other employees. The benefits of this are that this can motivate performance in competitive workplaces and among employees who have a competitive nature (Kokemuller, 2012). However this comparative methods could cause infighting, lack of teamwork and a lack of harmony among employees within the business, and this could lead to a deterioration in performance (Kokemuller, 2012). This method could be used in conjunction with the graphical scale, as the graphical scale would allow easy comparison between employees (Root, 2010).

360 Feedback

The development of an employee is dependent on the progress made within the specific department that they work in, as well as how effective they are when working with the rest of the company (Root, 2010). 360 degree feedback is a popular performance appraisal technique in modern organisations. In this method, the employee is evaluated by a wide range of people. This can range from co-workers, to supervisors as well as customers and those working under them (Kokemuller, 2012). One advantage of this is that the employee can see how a wide range of stakeholders view their performance in the key relationships that are critical to the employee’s job role. Different perspectives are also a positive in the appraisal process, and this is much more comprehensive than having just one person assessing the employee’s performance (Kokemuller, 2012). Hakala (2012) notes that 360 degree feedback is the most comprehensive, but also the most expensive performance appraisal measure and is normally only reserved for key employees within the organisation. Indeed, 360 degree feedback can be seen to be very good for gaining a broader perspective, having multi source feedback and for greater self-development. It is able to measure a range of different objectives effectively that other aspects may not, such as interpersonal skills and customer satisfaction (HRwale, 2015). There is also the 720 degree method, which Shaout and Yousif (2014) cite that it is 360 degree but practiced twice. It includes getting feedback from further external sources such as suppliers, family and communities of which the organisation is intertwined with. 360 degree feedback is expensive and time consuming for organisations to implement, as it is much more comprehensive, and requires much more time invested in it to implement as opposed to the other methods previously discussed.

Self Evaluation and Team Evaluations

Another form of effective performance appraisal has been seen to be self-evaluation and team evaluation. The benefits of these are that they are easy to administer, involving forms that can be filled in and used to rate yourself or those in your team based on a number of different criteria (Root, 2011). These forms can also be used in conjunction with other methods in an attempt to see if their colleagues and self-performance evaluations are of a similar view to the managers. Indeed, Root (2010) mentions that this is particularly useful when teamed with a performance review. Fellow workers may possibly have a better perspective of the jobs that are performed by their peers, and also have a better insight into what working them is liked (Root, 2012). However, there is obviously the possibility that a bias may exist when self-evaluation, or evaluating colleagues who may be friends, or who may be disliked despite having stellar performance in their job roles. This evaluation by peers or by the team can help to open up conversation between the manager, the employee, and the team which can be extremely beneficial to the overall development for the employee (Root, 2010). This is because there can often be discrepancies between what the management, and what the employee consider to be important performance factors (Hakala, 2008).

Management By Objectives

The final technique of performance appraisal is management by objectives. Here, employees are assessed on how they can accomplish a specific set of objectives that the company have asserted are critical for the successful completion of the organisations corporate objectives (Jafari et al., 2009). Their performance can be graded against the objectives which are specified by the management (Shaout and Yousif, M, 2014). This is a process which converts objectives or organisations to objectives for the individual employees. This requires: setting goals, periodic reviews, plans of action as well as self-control (Jafari et al., 2009). So, the process would begin with statements of action such as “reduce defected parts in the manufacturing process to 5%”, throughout the process there would be a close monitoring and reviewing of the objectives previously identified to keep the employee focused on their goals (Hakala, 2008). Therefore at the end of year performance appraisal, the progress the employee has made towards their goals is assessed, with new goals set for the next year. This process can be seen to be more useful for managerial positions, as their key goals may be more closely aligned with corporate strategy, and thus easier to identify. Likewise, the negatives may not be applicable to all jobs. Another negative would be the fact that focusing on specific objectives in the performance review may lead the employee to neglect any objectives which are not so heavily scrutinised, or not tied to the allocation of merit pay (HRwale, 2010).

Conclusion – Is there one best method of performance appraisals?

As has been seen in this essay, and as academics assert, there is no one size fits all approach to employee performance appraisal (Scott and Einstein, 2001). It can be seen that a range of different performance appraisal processes are effective when implemented (Root, 2010). As well as this, more and more companies are beginning to recognise that effective performance appraisal is key to successfully achieving corporate objectives (Grote, 2000). Human resource management and performance appraisals are aimed to improve corporate performance, while targeting individuals on the individual level as opposed to the business level. It is important to develop realistic and clear performance standards while reducing communication problems between the managers and their employees. Companies need to select the correct method for them based on a range of different factors, such as the need to compare employees, the cost of the method, the scope for error as well as the training needs evaluation for their specific company (Jafari et al., 2009).

If performance appraisals are not done correctly, a mixed message can be left which leaves employees feeling disappointed and confused, whereas the purpose of performance appraisals are to reinforce the good work the best performers do, and to try and improve what poor performers do (Knight, 2011). In order for the performance appraisal process to be successful, it needs to have the same quality of businesses who thrive. It needs passion, agility, speed and alignment (Bersin, 2013). Organisations need to be flexible in their processes, and arrange them to meet the targets for their specific company. Organisations also need to be aware of overcoming the negatives of performance evaluation such as having a one sided conversation, or an evaluator bias (Johnson, 2011). If these are present, they can have a negative effect upon employees, which is not intended. Therefore it is impossible to recommend one process over all of the others. As has been seen, all the processes have negatives and positives and are more applicable in different situations. 360 degree feedback is the most comprehensive of all the methods, but this is expensive and time consuming and can still fall foul of the negative aspects of performance appraisal. Companies thus need to ensure efficient performance appraisal, and align the process with their corporate objectives.

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Introduction

Cyert (1990: 29) defines leadership as ‘the ability to get participants in an organisation to focus their attention on the problems that the leader considers significant’. The functions of leadership considered by Cyert (1990: 29) therefore align to organisational, interpersonal and decisional actions. In light of increased attention being directed towards the heightened levels of dynamism found in the global business environment, an emerging interest is being directed towards the need to explore how leadership relates to organisational actions and, importantly, change management (Teece, 2009; Beerel, 2009). Change is an on-going part of any firm’s strategy and is a strategy which has proven to be significantly related to a firm’s ability to perform and sustain competitive advantage (Kavanagh & Ashkanasy, 2006). The postmodern era thus demands that organisations are able to deal with change as a constant dynamic within the firm (Hayes, 2007; Teece, 2009). As such, attention is directed within this essay towards the influence of different types of leadership on promoting a change vision within the firm (Anderson & Anderson, 2010).

Change and leadership

Gill (2002) argues that change ‘requires effective leadership to be successfully introduced and sustained’ (p.307). Combining an understanding and translation of vision, values and strategy coupled with inspiration is argued by Gill (2002) to promote a more sustainable change approach within the firm. This essay introduces four leadership theories: authoritarian, democratic, transformational, and transactional, and discusses their approach in relation to change management. Stemming from this it is argued that there is a need to adopt a situational based approach to leadership to assume the flexibility and adaptability required to support change within the firm (Steers, Sanchez-Runde & Nardon, 2012).

Change and the role of autocratic leadership

Early studies of leadership including that of the theoretical development of Great Man Theory approached leadership from a trait perspective and argued that there were characteristics within a leader, which made them successful. This theoretical position thus supported the contention that leaders were born and not made (Hoffman, Woehr, Maldagen-Youngjohn & Lyons, 2011). One of the earliest approaches to leadership, Great Man theory paved the way for a study of the leader as a separate entity to those within the firm. Aligned to this, autocratic styles of leadership promoted a separation between the leader and his employees. Autocratic leaders are therefore leaders who impose a style, which is characterised by individual control over decisions within the firm. This type of leadership style results in little opportunity for input from employees, with the leader instead dictating decisions across the firm (Van Vugt, Jepson, Hart & De Cremer, 2004). Aligning this to the context of change management, this is a leadership style which has been shown empirically to hinder the progress of change within the firm (Bennis, 2000).

As seen in Kotter’s eight stage model of change, change can be approached in a prescriptive, diagnostic manner. Kotter (1996) argues that in order for change to be sustained within the firm there is a need to ensure high levels of employee involvement. This employee involvement is needed to overcome the deeply rooted structural inertia related to change processes as presented in the work of Hannan and Freeman (1984). Hannan and Freeman (1984) argue that change challenges the equilibrium within the firm, and thus there is a need to lead change in a way which lowers resistance through employee involvement. Autocratic leadership therefore offers no room for this involvement and is thus linked to higher levels of employee resistance and a lack of stability as part of the change programme (O’Toole, 1995). Denton (1996) argues that autocratic change goes against the simple rules of change by failing to appreciate the need to gain input from employees to sustain and in turn operationalize change.

Despite the negative associations between an autocratic style of leadership and change there are times when autocratic styles of change may be suitable. For example, reflecting upon the different types of change presented by Gersick (1991) autocratic styles of change may be appropriate for those firms having to make a dramatic, time pressurised change under a punctuated equilibrium approach. The quick decision making processes aligned to this form of leadership would speed up the change process and would enable one individual to take control of the change to ensure a consistent approach. It is however widely noted that whilst elements of autocratic leadership may be appropriate in terms of pressurised change, the overall style of autocratic leadership in its entirety fails to allow for change to foster and develop in an effective way across the firm (Burke, 2013).

Change and the role of democratic leadership

Moving towards a greater capacity to allow for employee involvement, democratic forms of leadership promote an open, collaborative form of leadership, which seek to facilitate conversations within the firm through the promotion of sharing ideas across all levels within the firm. Considered to be a leadership style, which supports flexibility within the firm, this type of leadership is positively aligned to change practices within the firm (Foels, Driskell, Mullen & Salas, 2000). Foels, Driskell, Mullen & Salas (2000) for example argue that democratic leadership has the potential to enhance the satisfaction of employees during change. It does so by supporting employee involvement, which Kotter (1996) argues facilitates a more sustainable approach to change by lowering damaging forms of employee resistance. Under democratic leadership styles, employees feel fostered and feel valued to share their opinions. This can in turn result in a greater development of change options with employees being able to directly influence the direction of change. This type of leadership is most successful when aligned to gradualist, evolutionary forms of change within the firm. Intentional, planned change can be supported by democratic conditions, which allow the time to involve all. This however is associated with challenges largely related to the time it can take to make a decision under this leadership style. Unlike autocratic forms of leadership where one person makes the decision, democratic leaders draw on as many perspectives as possible, which can slow down the rate of change. Sustainable under planned change, the democratic leadership style would be less suited to conditions of punctuated equilibrium change.

The changing vision of leadership

Whilst autocratic and democratic styles of leadership were considered to be viable leadership options in the 1980s/1990s, today’s business environment demands a more aspirational, visionary approach to leadership driven by dynamism and the rising power of employees. The transformational leadership style is a style, which epitomizes passion and inspires positive changes across the organisation. Both process and people driven, transformational leaders relate to the need to understand employees within the firm. Moving towards a more personalised form of leadership, this leadership style has been positively related to effective and sustainable approaches to change within the firm (Avolio & Yammarino, 2013). Eisenbach, Watson & Pillai (1999) for example argue that transformational leadership is the most appropriate approach to change due to the passion and inspiration it promotes. This in turn supports the prescriptive model of Kotter (1996), which highlights the importance of creating and maintaining a momentum for change (Carter, Armenakis, Field & Mossholder, 2013).

In an empirical study by Carter, Armenakis, Field & Mossholder (2013) transformational leadership was shown to improve the quality of change and the relationship quality between leaders end employees. This was further supported by Paulsen, Callan, Ayoko & Saunders (2013) who argue that transformational leadership supports innovation during times of major change. Supported by findings from employees, Paulsen et al (2013) showed that employees were most influenced by transformational leaders and this in turn inspired a greater engagement with the change environment.

Change and the role of transformational leadership

Adopting a personal approach to change, transformational leadership has been praised for its ability to lower resistance to change. As widely noted across the change management literature, resistance to change can be a hinder to the effectiveness and sustainability of change (Hayes, 2007). Resistance can thus be debilitating for those firms who have to change to survive. Oreg & Berson (2011) thus show that under the umbrella of transformational leadership, employees are less likely to resist large-scale organisational change. Change values were positively related to the passion inspired by the transformational leader. This leadership style is therefore effective at eliciting change, which is inspirational. This approach may be appropriate during a large-scale change where there is a need to instil employee confidence and trust. Supported by the change management literature, transformational leadership supports many of the stages of the change process to ensure that any change is deeply rooted in the new culture of the firm. In particular, this type of leadership has been aligned to a continual, evolutionary process of change, which again is deemed to be best suited to this style.

Whilst transformational leadership is aligned to a number of core advantages, it is again in a similar vein to democratic leadership related to slower forms of decision-making compared to more autocratic styles of leadership. It is therefore important to create a culture within the firm where change is planned and incremental in nature. This is supported by the link between incremental change and the overall sustainability of change (Gersick, 1991).

Change and the role of transactional leadership

The final leadership style considered within this essay is that of transactional leadership. The transactional approach to leadership refers to a leadership style, which directs followers in the self-interests of the leader. Whilst transformational leadership has democratic foundations, transactional approaches motivate employees to perform by aligning rewards to the wider strategic goals of the firm. In the context of a change management programme, an employee would be rewarded for facilitating new changes within the firm but would be punished if they failed to operationalize the changes implemented. The exchanges between the leader and his followers are therefore exchanges based upon the achievement of wider organisational goals. Supported by the clear articulation of change goals, this is a leadership style, which is considered to achieve order in light of change (Bono, Hooper & Yoon, 2012).

As shown in the work of Zhu, Riggio, Avolio & Sosik (2011) when directly compared to transformational leadership, transactional leadership approaches were not as successful when leading change. However, both have the potential to enhance the employee’s motivation to change. The success of the transactional style of leadership is however dependent upon the type of people within the firm. This type of leadership works best when the clear aspects of change can be defined and translated into achievable goals. Aligned to goal setting theory, this is an approach which works well with those employees who are motivated by challenging environments. With a speedier change process than transformational leadership, transactional styles balance the motivation for change with the need to operationalize it in an efficient manner. This is therefore an approach, which is often coupled with transformational styles with academics arguing that a dual focus on both is the most sustainable solution (Zhu, Riggio, Avolio & Sosik, 2011).

Conclusion

In conclusion, this essay has detailed four individual approaches to leadership and has discussed the pros and cons of each style. Arguing that perhaps what is needed is a move towards more situational forms of leadership, this essay states that situational leadership offers an approach to change which aligns to the flexibility and adaptability required in the external business environment (Thompson & Glaso, 2015). Reflecting upon an emerging trend within the leadership literature, situational leadership refers to a combination of different styles dependent upon the situation. This therefore supports discussions within this essay where the pace of change dictates the suitability of different styles. In light of heightened dynamism, adaptability is key and thus adaptability is also key to the leadership style adopted. Perhaps therefore the most suitable leadership style to elicit change is one where emphasis is placed on having an appreciation of the most suitable style for the situation at hand. This is thus an approach, which requires leaders to have the skills to switch between different styles when appropriate.

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The international business literature highlights the importance of global integration and the increasing interfaces, which exist between people, nations and cultures within the modern multi-national corporation (MNC). Managing a MNC requires a management of differences with local distinctiveness increasingly positioned as a point for competitive differentiation (Hartmann, Feisel and Schober, 2010). The pressure for global integration and local responsiveness as highlighted in the work of Rosenzweig (2006) requires MNCs to successfully balance both cultural and institutional variables. This report, draws on research in order to critically evaluate three cultural variables and three institutional variables which are positioned in this essay as having the power to influence managerial and employee behaviour within MNCs. Research into MNCs often positions them as being complex and multi-layered in nature (Scherer, Palazzo and Seidl, 2013). MNCs face growing challenges in managing the complexity of interactions and thus, this requires firms to understand dimensions of employee and managerial behaviour and both are influenced by cultural and institutional variables (Meyer, Mudambi and Narula, 2011). This essay begins with a consideration of cultural variables of importance to MNCs.

Culture is defined by Hofstede (1980, p. 12) as: ‘Not a characteristic of individuals; it encompasses a number of people who were conditioned by the same education and life experience. When we speak of the culture of a group, a tribe, a geographical region, a national minority, or a nation, culture refers to the collective mental programming that is different from that of other groups, tribes, regions, minorities or majorities, or nations’.

Broadly speaking, culture refers to the collective mental programming of individuals and this influences the way in which managers and employees behave within the firm. One cultural variable of importance is national culture and in particular as highlighted in the work of Hofstede (1980) five dimensions of culture should be considered: power distance, uncertainty avoidance, individualism/collectivism, masculinity/femininity and short-long-term orientation. Managerial and employee behaviour within MNCs is inherently influenced by cultural dynamics with employees being a product of the culture they exist within. Two cultural elements in particular require consideration, power distance is a cultural dimension, which refers to ‘the extent that individuals accept differences between people as legitimate and expected’. If the population has a high power distance, then this reflects a focus on hierarchical power and differences in status. Employees from this culture would be accepting of different managerial groups and taking lead from those above them. This naturally influences employee behaviour with employees in a high power distance culture able to accept instruction from managers (Farh, Hackett and Liang, 2007). Farh, Hackett and Liang (2007) evidence this by arguing that power distance impacts upon levels of perceived organisational support and the outcome of employee relationships within the firm. Hofstede (1980) also highlighted the importance of individualism/collectivism and the need to understand the extent to which individuals focus on individual needs or the needs of the group. This is a cultural variable, which impacts upon behaviour within the firm. Further, an additional complexity lies in the international operations of the MNC and a firm will have to deal with different cultures. For example, India is viewed as a collectivist culture compared to the UK, which is more individualistic in nature. This will have natural implications on employee behaviour and the management of relationships within the firm.

A second cultural variable refers to cross cultural differences across employees within the MNC. It is important that MNCs are able to develop cross-cultural teams in a manner, which enhances the ability of the firm to integrate innovative thinking with the competitive orientation of the firm. Managers within MNCs have to be able to avoid cultural misunderstandings and adopt a level of cultural sensitivity. Haas and Cummings (2014) argue that due to the multi-layered nature of MNCs there is a need to focus upon person-based differences. The development of cross-cultural teams is often highlighted as being an important condition of competitive performance (Caligiuri and Lundby, 2015). Barner-Rasmussen et al (2013) position cultural skills as a resource, which maximizes organisational human capital. In order to maximize the effective positioning of human capital, managers have to be able to understand the role culture plays in creating an underlying, strong link amongst individuals (Schein, 2012).

A third cultural variable of consideration is the study of organisational culture (Schein, 2012). Organisational culture refers to the shared values and the inherent norms which exist within the firm (Schein, 2012). Pothukuchi et al (2002) argued that organisational culture could have a negative impact on international business and on the actions of MNCs. Considered to be a mechanism of differentiation; organisational culture is positioned as overseeing and supporting employee behaviour within the MNC. Due to the multi-layered nature of the MNC, Al-Husan, Al-Hussan and Perkins (2014) argue that there is a need to have multilevel human resource management systems in place in order to support different employee groups. This does however raise a challenge with regards to the promotion of consistency while at the same time differentiating on the basis of culture. This is a particular challenge for the MNC where a global, brand image is required amongst the dynamic determinants of employee behaviour within the firm. Sofka et al (2014) argue that for an effective organisational culture to result, MNCs have to be able to focus upon value creation.

Cultural variables are a soft consideration, which ultimately have the power to affect employee behaviour within MNCs. Difficulty lies in the intangible nature and the difficulty associated with the measurement of organisational culture (Baird, Hu and Reeve, 2011). Thus, while cultural variables notably are considered to impact upon MNCs and the wider realm of international business, it is difficult to precisely account for difference and this is largely tied up within the power of individuals within the firm. It is important however to utilize frameworks such as those provided by Hofstede (1980) to move towards a more detailed appreciation of culture (Hofstede, 2011).

Aligned to the multi-layered nature of the MNC, culture can also be viewed as having different layers (Steenkamp, 2001). National culture as reviewed in the work of Hofstede (1980: 2011) is one layer but it must be appreciated alongside other elements of culture including more microelements including organisational culture. The study of culture and its impact on international business requires a greater exploration of how different elements of culture interact.

Managerial and employee behaviour is also influenced by a number of institutional variables. This essay discusses three institutional variables in particular: political, religious and economic. Each institution affects firms differently dependent upon the country of operation. Morgan, Kristensen and Whitley (2001) argue that a multinational firm must be able to organize across institutional devices and this requires an understanding of different economic, political and religious considerations. While increased attention has been directed towards the value of standardized approaches, in reality, adaptation is considered to be the most effective way to deal with different dynamics in the external environment (Teece, 2009).

The political environment is widely considered to influence the environment within which MNCs operate. Luo (2004) highlights the importance of developing a platform built on co-operation between the MNC and the host government. An inclusive, integrated partnership is often positioned as being the most effective platform from which to build relationships. Present within a particular political institution, individuals will align to a particular political identity. A political institution such as the leadership of the Conservative government in the UK has the power to influence the way in which employees and managers behave. Largely, the influence on behaviour is fuelled by regulation and the design of policies and practices. Any new regulation implemented will have a natural effect on behaviour within the firm. Difficulties however arise when change is resisted within the firm and this can often arise through a collection of individuals promoting the status quo within the firm (Hayes, 2007). Offering a different viewpoint to that of Luo (2004), Heikkila, Brewster and Mattila (2014) argue that while largely political institutions affect the larger operation of the MNC, what is needed is a more micro exploration as to how political conflicts can influence employee behaviour. They, in particular, argue that political conflicts within a given country or amongst individuals within the firm can result in inherent challenges related to the overall effectiveness of human resource management within the firm. From a critical perspective, the work of Heikkila, Brewster and Mattila (2014) highlights the importance of both a macro and micro exploration of the political institution. Too often the political institution is viewed as having a higher-level influence on the firm.

A consideration of religion is needed within any MNC. An internalized look at an individual is needed in order to understand and then manage individuals at work (Hollway, 1991). An analysis of employee behaviour promotes an understanding of individuals and, importantly what makes up that individual. Lund Dean, Fornaciari and McGee (2003) explore the influence of religion on employee behaviour and argue that religion plays a core role in influencing employee behaviour and should therefore be given more consideration than it currently is across the academic community. More specifically, McGhee and Grant (2008) explore the link between religion and work and argue that individual’s behaviours interpret their own individual actions through a religious lens. Increasingly, attention has been directed towards the links, which exist between the religious orientation of an individual and their ethical behaviour in the workplace. Playing an important role in the global economy, increased attention is directed towards the brand image of MNCs and their responsibility to the wider community. Religion as an institution thus becomes important to consider how this influences the way in which individuals interpret decisions and perhaps behave in an ethical manner due to their religious affiliations. Another consideration related to religion refers to the prominence of diversity and, in particular the levels of diversity MNCs have to deal with. The modern day MNC must be able to manage this diversity and use it to their advantage by promoting difference across the firm within cross-cultural teams.

A final institutional variable considered is the role of the economic institution in influencing employee and managerial behaviour. The economic institution captures all institutions that are a player in the economy. This includes everything from competitors, consumers to those providing financial services. Focusing upon one specific economic institution, this essay argues that it is important to focus upon manufacturers and how this particular economic institution influences employee and managerial behaviour. In a global market, which is often positioned as being highly, dynamic and adaptable, there is a need for firms to understand how the actions of manufacturers will influence the behaviour of individuals within the firm. For example, any changes in manufacturing resulting in a change of process within the firm would have a natural influence on employee behaviour and importantly the way in which managers approach change within the firm (Hayes, 2007). Managers need to be closely aligned to manufacturers they are working with and use this to guide an integrated approach to behaviour. Within the economic setting, any economic institution has the power to influence the objectives and future of the firm. A focus on the sustainable future of the firm is required to ensure that if changes in the market exist for example changes to demand and supply, managers must be able to adapt in a timely manner. Economic institutions are thus often positioned as driving flexible and adaptable decision making from managers (Liu, 2009).

In conclusion, research into MNCs suggests that they are complex and multi-layered in nature. The role and prominence of MNCs requires attention to be directed towards the individuals, which make up the actions of the firm. As discussed in the essay a number of cultural and institutional variables can be identified as having an influence on the way in which employees and managers behave. A running theme throughout the discussion is the importance of balancing micro level considerations with a higher-level understanding of macro phenomenon. This therefore promotes the need to conduct research at multiple levels within the firm most notably starting with individual employees.

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