Walters Chpt 1

Positive Management

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Positive Management

Increasing Employee Productivity

Jack H. Walters

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Positive Management: Increasing Employee ProductivityCopyright Business Expert Press, LLC, 2010.All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any meanselectronic, mechanical, photocopy, recording, or any other except for brief quotations, not to exceed 400 words, without the prior permission of the publisher.

First published in 2010 byBusiness Expert Press, LLC222 East 46th Street, New York, NY 10017www.businessexpertpress.com

ISBN-13: 978-1-60649-052-5 (paperback)ISBN-10: 1-60649-052-4 (paperback)

ISBN-13: 978-1-60649-053-2 (e-book)ISBN-10: 1-60649-053-2 (e-book)

DOI 10.4128/9781606490532

A publication in the Business Expert Press Strategic Management collection

Collection ISSN: 2150-9611 (print)Collection ISSN: 2150-9646 (electronic)

Cover design by Jonathan PennellInterior design by Scribe, Inc.

First edition: May 2010

10 9 8 7 6 5 4 3 2 1

Printed in the United States of America.

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I dedicate this book to Sirje Kiin, my wife and the best writer I will ever know, and to Judy Walters, my sister

and lifesaver during the creation and preparation of this manuscript.

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Abstract

There is a myth in American and other fi rst-world business cultures that being tough and unreasonable are keys to extracting high produc-tivity from employees, but profound economic, demographic, and cul-tural change are creating a workplace where that myth can no longer be believed. People who are hard to work for will face increasing diffi culty in fi nding top-quality employees, especially highly educated ones. If your organization has this problem, it could seriously hamper the accomplish-ment of strategic objectives. This book explains how to use positive man-agement (PM) as an organization-wide strategy to motivate employees, increase productivity, and accomplish organizational goals by creating upbeat and dignifi ed relationships in the workplace. It covers the use of PM in a variety of situations, including diffi cult and negative ones, to achieve higher employee commitment and motivation, to lower commu-nication ineffi ciencies, and to reduce absenteeism and turnover.

The following is an overview of the books contents:

Chapter 1: Why PM is needed, productivity and sustainability, and PM needs assessment

Chapter 2: Organizational productivity broadly defi ned, including its relationships to employee satisfaction and happiness

Chapter 3: The many negatives of negative management and why it must be removed from organizations

Chapter 4: What PM is and where it came from Chapter 5: Why PM is needed, focusing on productivity and

value creation Chapter 6: How and why PM motivates employees Chapter 7: PMs relationship to organizational culture, focus-

ing on the role of trust in the workplace Chapter 8: Answers to tough questions about the implementa-

tion and practical use of PM Chapter 9: PM and decision making

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Chapter 10: Specifi c steps to increase positivity in the workplace

Chapter 11: Examples of organizations with successful PM strategies

The target audience for this book is experienced middle and upper managers in larger organizations and owners/general managers of smaller ones. It can be useful to students of management or those who are just starting out, but its framework is best understood by those who have fi rsthand experience with supervising managers and line employees over an extended period.

Keywords

Management, productivity, human resources, human resource manage-ment, motivation, supervision, strategy, leadership, positive manage-ment, positive leadership, manager, subordinate, employee, organization, psychology, organizational behavior

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Contents

Chapter 1 Positive Management, Strategy, and Productivity . . . . . . 1

Chapter 2 Rethinking Productivity . . . . . . . . . . . . . . . . . . . . . . . . . 7

Chapter 3 Why Does Negative Management Exist, and Can It Be Reduced? . . . . . . . . . . . . . . . . . . . . . . . . 21

Chapter 4 The Emergence of Positive Management . . . . . . . . . . . 43

Chapter 5 Why Is Positive Management Needed? . . . . . . . . . . . . . 49

Chapter 6 Positive Management and Motivation . . . . . . . . . . . . . 63

Chapter 7 Positive Management and Organizational Culture . . . . 75

Chapter 8 Straight Talk About Positive Management . . . . . . . . . . 81

Chapter 9 Positive Management and the Day-to-Day Business of Managing . . . . . . . . . . . . . . . . 95

Chapter 10 Creating a Positive Work Environment in Your Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

Chapter 11 Organizational Strategy and Positive Management . . . 115

Notes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125

Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

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CHAPTER 1

Positive Management, Strategy, and Productivity

We may be at a point of major change in how we manage organizations. Two powerful new insights have emerged:

1. It is recognized that the path to future prosperity for the developed world must come through different business models and strategies than have been used in the past.

2. The primary discipline underlying management is changing, and it may be necessary for the practice and study of management to change with it.

This book deals with the idea of building productivity in organi-zations (certainly not a new topic) but approaches it from a direction not thoroughly investigated in the past. Historically we have thought of productivity gains as being extracted from our workforces in the same way that we extract diamonds or oil from the ground. This approach presumes a tension between managers (representing owners) and the nonmanager employees hired to carry out the owners wishes. In this con-ceptualization, employees give up productivity because managers devise ways to get it out of them, just as they devise ways to get minerals out of the ground or more units of product from the same-size batch of raw materials. This view of productivity does not assume that employees are unwilling to be productive, but there is no presumption that they are willing, either. This book proposes an organizational strategy that treats employees more like partners than subordinates. The goal of this strategy is to increase commitment, effort, and focus in the organization and to increase productivity by leveraging those human resources.

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2 POSITIVE MANAGEMENT

Productivity and Sustainability

For fi rst-world economies, the key to sustaining employment and stan-dards of living in this century will lie along one of two paths. The fi rst path is already known: the creation of new businesses and industries that can-not be quickly duplicated by countries with signifi cantly lower labor costs. The second path was revealed to us by the fi nancial debacle during the fi rst decade of the 21st century: Organizations must sustain themselves by increasing effi ciency. Productivity is integral to both paths. It is crucial for nascent industries and the central issue in survival of mature organizations.

To sustain an income base that will maintain our current standard of liv-ing and support our businesses, we must fi nd a way to keep wages high and unemployment low. Keeping production of goods and services inside fi rst-world economiesnot allowing them to migrate simply because of lower wage structuresis one way to do this, but it is not nearly enough. The larg-est part of the equation is increasing productivity in existing organizations to limit infl ationary pressure on product and service prices. There is no magic wand that will protect fi rst-world businesses from being outsourced to sec-ond- and third-world economies, but sustained high productivity probably offers the best opportunity to slow or prevent that transition.

Though business productivity is an important focus of this book, we will not ignore not-for-profi t and public-sector organizations. The out-sourcing issue is not signifi cant for these parts of our economy, but the relationship between productivity and sustainability is likely to be just as important as it is in for-profi t organizations. Now is not the time to resignedly tussle with ever-increasing costs. If our organizations are to prosper, be it in making profi ts or better serving stakeholders, they must get better at what they do. If we are to sustain the lifestyles to which we have become accustomed and offer our quality of life to our children, we need to perform many organizational tasks more cheaply than they are done now, and these savings need to be created within our borders. We have found ways to maintain or even lower prices over the last 20 years, but we are now discovering that, in doing so, we have hollowed out some of the highest value-added sectors of our economy. The only way to level prices and maintain profi tability without further weakening our economy is to increase productivityto produce more outputs with equal or fewer inputs.


POSITIVE MANAGEMENT, STRATEGY, AND PRODUCTIVITY 3

Infl ation- and dividend-adjusted stock performance showed approxi-mately 0% change in value during the fi rst decade of the 21st century. The weak performance of equities can be attributed, at least in part, to a loss of energy and focus within organizations. That loss of ability is par-tially due to organizations signaling (for decades) that loyalty and com-mitment are unimportant. As the gears of demographics and economics entangle society in their mesh, we are realizing that building disloyalty into our organizations social fabric was not a good idea. The challenge for managers is to get loyalty and commitment back.

For employees to perform well day in and day out, they need to want to perform well. This, too, is challenging because median house-hold income is also stagnant, with practically no change between 1998 and 2008.1 In fact, the infl ation-adjusted median household income was lower during the majority of that period than it was for 1998.

With company performance and household incomes stagnant, some-thing fundamental must change to again allow sustained wealth and income creation from sources other than natural resources, importation of goods produced elsewhere, and fi nancial manipulation.

New Thinking About the Psychology of Management

Changes in the underlying fi eld of psychology have led to the develop-ment of a new subfi eld in management focused on the construction and maintenance of positive relationships in the workplace. Generally this subfi eld aims to create a better balance between positive and nega-tive actions in work environments. It operates on the (quite reasonable) assumption that negative information currently commands the majority of management attention in organizations. Positive management (PM) focuses new and much-needed attention on the role of happy, confi dent, and secure employees in the overall performance of the organization. By using an economic (as opposed to accounting) defi nition of productivity, we can link increases in productivity to positive work relationships.

Can This Really Work?

Skepticism about positive management (PM) is understandable, espe-cially if one adheres to the simplistic view that it is just being soft on



employees. If one holds that view, reactions to PM might include the following:

Nobody coddled me in my career. If you go too easy on people, theyll slack off. Sometimes bad things happen, and it is foolish to act like they

dont. If competition is intense and becoming more so, why is now a

good time to use positive approaches? Things have tanked in the past few years. Now is not the time

to preach about being nice.

PM does not mean that anybody is soft on employees. It does, how-ever, require that managers exercise higher degrees of professionalism and self-discipline. Tough times dont last. Economic history has proven this time and again. As this century rolls forward, normal strategy issues will dominate our agendas:

How to build competitive advantages through people and capital investments

How to deal with changes in industry and global economic conditions

How to plan for the very long term

The biggest challenge will come from looming shortages in educated employees, who are necessary to sustain fi rst-world economies. From an organizational perspective, one solution to this problem is to use super-visory techniques that increase commitment and effort, thus reducing turnover and slowing the need to expand staff. Perhaps most important, correctly applied PM techniques can leverage the creativity of educated workers, providing an opportunity for large gains in productivity.

Positive Management and the Ethics of Managing

It is good to be a positive and uplifting leader. It is good to avoid excessive negativity and appropriate to question negative approaches used now and in the past. But I want to make it clear that I would not write this book


POSITIVE MANAGEMENT, STRATEGY, AND PRODUCTIVITY 5

if those were my only reasons for advocating PM. As people interested in

strategy, we have to be focused on what is best for the organization in the

intermediate to long term. I am writing this book because PM can help

you build and sustain competitive advantage.

Many aspects of PM would be well received by religious and social

service organizations because they emphasize fairness and empathy. While

that framework is worthy and appropriate, it is not the basis on which

this book is written. This books embrace of PM is based on the idea that

effectiveness, effi ciency, profi tability, and sustainability can be linked to

the use of positive techniques. Negativity, which is deeply embedded in

our business culture, is a problem that needs to be reduced or, in a best-

case scenario, eliminated.

The terms methods and techniques are used throughout this book

because they effi ciently convey important information. It is very impor-

tant, however, to realize that the actions recommended by this book can-

not work simply as performed behaviors. One must accept them as a

better way of managing and be willing to replace current practices with

them. Some managers simply will not be able to accept these more trust-

ing and egalitarian approaches as workable and will never be comfortable

enough to stay with them over time. However, for those who are willing

to embrace a new human resources strategy, PM can alter the culture to

create a more committed and sustainable organization.

Assessing the Positive and Negative Conditions of the Organization

Some who read this book may say, Great idea. Were already doing

it. Their interests may be limited to checking on whether their orga-

nizations successful positive culture building meets or exceeds what is

suggested here. Others may be in a very different cultural situation and

may be considering making signifi cant changes. To assist in determining

where an organization is in terms of implementing PM, consider this list

of questions:

Does the organization have an anonymous suggestion box?

Are employee suggestions given serious consideration?



Is there an employee reward for continuous quality improvement?

Is there an employee reward for product or process innovation? Do employees have a mechanism for discussing complaints and

problems about supervision? Is that mechanism insulated from employees chains of

command? Does the organization have a stated policy about preserving

respect and dignity for employees? Is compliance with that policy routinely measured? Are managers compensation and incentives tied to mainte-

nance of a positive work environment? Are grievances about supervisory practices frequent? Are surveys of employee attitudes routinely conducted? Are the results of those surveys used in senior-level decision

making? Are the results of those surveys shared with employees? Are employees who participate in surveys generally satisfi ed

with the organizational climate? Have scores on the surveys recently changed? Can observed changes be tied logically to events or specifi c

employees? Is the work environment an issue discussed among senior

managers?

The purpose of this list is to stimulate thinking and discussion about the overall PM condition of an organization. If the answers to most of these questions are negative, then so is the organizational environment. Implementing the practices listed here is a step in the right direction, but it will not create a positive workplace. Implementation depends on underlying psychological and leadership principles that can allow imple-mentation not just by an individual but also by a coordinated network of managers. Before a work environment can be shaped to be more positive, a clear mental image of what it will look like and how it will be accom-plished must exist in the minds of key managers. The focus of this book is on helping managers to construct that image.


Index

Aabnormal, 43, 96absenteeism, 810, 14, 16, 17, 28,

72, 115Academy of Management, 46accounting productivity, 78Acton, Lord, 41administrative ineffi ciency, 1011Administrative Science Quarterly, 98adverse selection, 910age groups, bachelors degree by, 31American culture, 2325American Psychological Association, 44appreciative inquiry (AI), 4546

Bbaby boomers, 30bachelors degree by age group, 31blame, 1079bombastic boss syndrome, 33bounded rationality, 9596British culture, 2325business models, 5153

CCameron, Kim, 45Carter, Jimmy, 91China, 49Collins, Jim, 96commitment

breaking behaviors, 17and happiness, 1819and satisfaction, 1617

competitivenessadvantage of human resources, 115and positive management, 4953

Conference Board, 23Cooperrider, David, 4546

creativity, 11criticism, 100101

praise and, 8586culture

American, 2325British, 2325organizational, 7580positive organizations, 11520quality and, 7778trust and honesty, 7677untrusting, 7880

customer relationships, 6162

Dday-to-day management, 9598decentralization, 9798demand, 90Devon Energy, 11718discretion, 111Drucker, Peter, 73dysfunction, 44, 46

Eeconomic productivity, 8education levels, 3132effectiveness versus negative manage-

ment, 4042ego

and negative management, 3638perceived outcomes and, 3738

emergence, positive management, 4346emergency mode, 33employee

dissatisfaction, 1516happy, 6162job satisfaction, 23lower level, 92unhappy, 2223

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130 INDEX

employment, 1415empowerment, 9798ethics, 8485

and positive management, 45extinction, 70

Ffear, 3334fi ght, 2526

and organization, 26free agency problems, 5762

Ggender terms, 1023generalizations, 10910Gen X, 3132Gen Y, 3132goal setting, 7374Great Place to Work Institute

(GPTWI), 117Green, Cecil, 118

Hhappiness, 1719

commitment and, 1819identifi cation and, 1819

happy employees, 6162Hawthorne studies, 15Heckscher-Ohlin model, 55Hells Kitchen (television series), 103Herzberg, Frederic, 71Hewlett-Packard, 100hierarchy of needs, 6365high-value-creation business models,

5152Hinckley, John, Jr., 91Hofstede, Geert, 109honesty and culture, 7677human resources as competitive

advantage, 115hypercriticism, 38

Iidentifi cation and happiness, 1819India, 49individual differences, 62intellectual property (IP), 5152, 54, 117

KKing, Martin Luther, Jr., 25

Llanguage, negative, 1035learned helplessness, 43Leontief, Wassily, 55lower level employees, 92low-value-added business model, 5253

Mmanagement

day-to-day, 9598by objectives (MBO), 73of psychology, 3psychology transfer, 4445by walking around (MBWA), 100See also negative management (NM);

positive management (PM)Maslow, Abraham, 6364Mayo, Elton, 15McClelland, David, 6566McGregor, Douglas, 6869monetary rewards, 1314motivation, 6374motivator-hygiene theory, 7172

Nnames, political correctness and, 10111National Transportation Safety Board

(NTSB), 87need for achievement (nAch), 6567need for affi liation (nAff ), 6667need for power, 6768negative-framework managers, 77negative language, 1035negative management (NM), 2142,

3840ego and, 3638

negative reinforcement, 70negative situation, 9697negativity, 2123

advantages, 2627disadvantages, 2729myth, 3435noise and, 2829versus reality, 93


INDEX 131

Network (fi lm), 24nicknames of individuals, 105noise and negativity, 2829noncreative goals, 73nonmonetary rewards, 1314normal value-creation business model,

52

Oorganization, fi ght and, 26organizational culture, 7580

role, 7678why important, 75

organizational development (OD), 46organizational strategy, 11520Organizations In Action (Thompson),

97outward focus, 17

PPackard, David, 100101passive-aggressive managers, 8687Pavlov, Ivan, 69perceived outcomes and ego, 3738pet names, 1056POB. See positive organizational

behavior (POB)politeness, 112political correctness, 10111positive and negative conditions of

organization, 56positive culture organizations, 11520positive management (PM), 16

and competitiveness, 4953diffi culty, 8384effectiveness problem solving,

4142effectiveness versus negative man-

agement, 4042emergence, 4346ethics of managing and, 45implementation undermining,

8283motivation and, 6374need for, 4962skepticism about, 34weaknesses, 8183

positive organizational behavior (POB), 4647

positive organizational scholarship (POS), 4445

positive psychology, 4344positive reinforcement, 70positive work environment, 99113positivity myth, 3536possessive terms, 107power, 65praise, 8586

and criticism, 100101problem solving, effective, 4142production cascade, 5557productivity, 16, 4953

defi ned, 714rethinking, 719and satisfaction, 1516sustainability and, 23value chain and, 55

psychologymanagement of, 3positive psychology, 4344transfer from management, 4445

punishment, 70

Qquality and culture, 7778

Rrational compassion, 94Reagan, Ronald, 9192reality versus negativity, 93reengineering economics, 5355reinforcement theory, 6971restraint, 113rethinking productivity, 719

Ssatisfaction, 1517

commitment and, 1617productivity and, 1516

satisfi ce, 96Schweitzer, Albert, 46Seligman, Martin E. P., 4344, 45, 96Simon, Herb, 9596sincerity, 82, 9394


132 INDEX

skepticism about positive manage-ment, 34

Skinner, B. F., 70social capital, 9596Southwest Airlines, 11517strategy, 16sustainability and productivity, 23SWOT (strengths, weaknesses, oppor-

tunities, threats), 58

TTDIndustries, 11920Texas Instruments, 11819Theory X, 6869, 7879Theory Y, 6869, 78Thompson, James, 9798Thorndike, E. L., 70three-needs theory, 6568titles for individuals, 1067trust, 99100

and honesty, 7677turnover, 89

24 (television series), 24

UUltimate Software, 117undermining postive management

implementation, 8283unhappy workers, 2223unionization, 8790University of Michigan, 45untrusting culture, 7880

Vvalue chain and productivity, 55

Wwar, 2526weaknesses of positive management,

8183win-lose approach, 1114

Zzero-sum game, 1114, 53


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