PARTICIPATIVE MANAGEMENT

Meaning & Concept of Participative Management

Type of management in which employees at all levels are encouraged to contribute ideas towards identifying and setting organizational-goals, problem solving, and other decisions that may directly affect them is called Participative Management/consultative management.

Participative management is a relatively new concept in management. It is a concept where organization decision makers include those affected by decisions within the decision making process; this method effectively ensures that everyone’s needs are met before making an organization decision. This method is a method that gives the employee empowerment as he/she has more accountability and responsibility. Also it shows that an organization has trust and values their employees. Organizations that implement such as approach also understand that management only cannot create innovative ideas especially since they do not interact directly with customers who they are essentially trying to satisfy.

The advantages of this approach -

1. Increase in productivity – The added responsibility given to employees will give a greater sense of association. Therefore employees will now work harder and longer hours to implement strategies that included their opinions. 
2. Job Satisfaction – Job satisfaction will be higher amongst employees as their opinions are heeded and implemented. This will give employees a feeling of being an integral part of the organization. 
3. Motivation – Decentralization of the decision making process gives employees more responsibility this means that employees will feel more important as his/her voice is heard. This importance in turn will increase motivation in all employees of the organization. 
4. Improved Quality – By including employees who are involved in various processes within the company all details of each and every process will be taken into consideration. In other words even the smallest detail will not be missed in any process as employees will remind the management team of missing steps. This will improve the overall quality of projects and its implementation.

The disadvantages of this approach -

1. The decision making process slows down – Because of the increase amount of participants in the decision process. The process itself slows as feedback and opinions start pouring in from everyone involved especially those who are trying to make a good impression.
2. Security concerns – Early within the decision process a lot of confidential information will be distributed among many members of staff. This will increase the risk that this information maybe leaked by someone lower in rank as they may not understand that the information he/she is privy to is to be kept a secret.
3. Lack of interest – All employees may not be interested or want to be involved in the decision making process this is attributed to the different behaviours employees have. For this approach to be effective employees must be interested in being part of the decision making process. 
4. Implementation process and one approach doesn’t fit all – participative management will not be implemented overnight as steps will have to be followed, goals and objectives need to be met before a system like this can be implemented. Lastly this approach will not work for every organization or department.

Benefits of participatory management

A number of benefits that can be derived from PM are as follows:

·         A major source of pleasure and happiness for highly extroverted individuals because PM means more social interaction

·         Participative management has been found to promote such things as customer orientation, continuous learning, and improvement in quality and control

·         Promotes teamwork, cooperation in solving problems, and combining knowledge

·         PM is critical to the struggle to improve the effectiveness of projects

·         Enhance the Feelings of being needed and wanted and that everyone’s opinions count will promote ownership

·         Decision making therefore benefits from wider range of knowledge, information, experience and increasing choices and opportunities

·         PM promotes the adoption of problem solving, rather than a predictive blue print approach to management to ensure flexibility, and maintain the ability to adapt to constantly changing realities

·         PM increases local capacity and empowerment. PM has to be introduced in which power is shared, everyone is given an opportunity to participate, work is conducted by consensus and multidisciplinary teams are utilized to implement processes

·         Improvement of organizational productivity with new ideas discovered by employees from practical experience;

·         Giving employees a chance to exercise creativity in their jobs and thus strengthen their motivation as well as increasing job satisfaction;

·         Ensuring that wages, bonuses and other remuneration are given on the basis of merit

·         The feeling of hostility towards orders from the top level of organization will be eliminated or decreased

·         Helps employees to feel able to drop their defenses and expand their energy productively instead

·         Provides more valid viewpoints because persons closest to the situation are involved develops interest and enthusiasm of subordinates

Forms of Participation in India

Organizations use a variety of programs aimed at increasing employee participation. All the different programs have one major objective and that is to increase employee participation. However the programs differ with regard to the degree of direct or indirect involvement, the influence they exert and the time length of the program.

            An organization is said to be using participative management when it uses either a very significant approach with widespread application or a sufficient number of programs to develop a substantial sense of empowerment among its employees. Participative management is basically a process where subordinates share a significant degree of decision making with their immediate superiors.

The different types/forms of participation in India are :

1.          Works committees: 

The Industrial Disputes Act of 1947 provides for establishing works committees in every establishment employing hundred or more workers. This legislation thus makes it compulsory for the organization to ensure employee participation. The work committee consists of equal numbers of workers and employer.

The employer’s representatives are nominated by the employer and should be those who are connected with the firm and have day-to-day contact with workers. The workers representatives are elected from among the workmen engaged in the firm in consultation with the union.

The main function of the works committee is to promote measure for securing and preserving amity and good relations between the employers and the workers. The works committee is normally concerned with day-to-day problems of the firm. Their task is to smooth away any friction that may occur between the management and the workers.

2.          Co-partnership:

In this method, employees are paid the share of profits in the firm of shares and not cash. Thus workers become shareholders in the company in which they are employed. Being shareholders of the company they are entitled to participate in management. They also receive dividend on their shares. Co-partnership increases the status of workers and improves their relationship with the management.

3.          Employee Directors:

Under this method one or two representative of the workers are nominated on the board of Directors of the company. They enjoy the same privileges and have the same authority as other directors have. They participate in the decision making process as regards policies and procedure. The representatives of the employees to be nominated are selected or suggested by the unions of the employees. The management of this method of participation is that many worker directors are ignorant about their role on the board and get in to conflict with other board members.

4.          Joint Management Councils (JMC) :

Under this system, joint management councils are constituted. These councils consist of equal number of representatives of employers and workers. The councils discuss various matters concerning the working of the company. The decision of that council is advisory in nature. The management however considers these decisions sympathetically and implements them although it is not mandatory.

5.          Suggestion schemes:

 As the name itself indicates, suggestion programs are formal plans to invite individual employees to make suggestions for work improvements. The suggestions are then sorted out as per their applicability and cost-benefits ratio. Employees whose suggestions result in cost saving for the organization are given monetary rewards that are proportionate to the company’s savings.

6.          Quality Circles :

The success of quality circles in Japan has led to their increasing popularity in Europe and the United States. A quality circle consists of a group of employees who meet regularly to discuss their quality problems, investigate causes, recommend solutions, and take corrective actions. Quality circles usually consist of eight to ten employees and supervisors who typically meet once a week on company time and on company premises.

7.          Total quality management :

TQM or total quality management is a philosophy of management that aims at constant attainment of customer satisfaction through continuous improvement of all organizational processes.

TQM is not a merely a quality improvement technique but rather a set of corporate values-a way of life demonstrating a strong commitment to improving quality in everything that is done.

8.          Self-managing Teams :

Self – managing teams are sometimes referred to as semi-autonomous work groups or socio-technical teams. Self – managing teams are natural work groups that are given a large degree of decision-making autonomy; they are expected to control their own behavior and results. In simple words, self-managed teams are teams whose members are permitted to make key decisions about how their work is done.

9.      Quality Circle – A Way of Participative Management:

Quality circles pioneered by Dr K Ishikawa, in early sixties, helped Japanese Industry to make a miraculous recovery from the ravages of the Second World War and transforming its earlier image as producer of substandard products into leading industrial nation with high productivity and reliable quality.