Post on 07-Feb-2023
COPYRIGHT AND CITATION CONSIDERATIONS FOR THIS THESIS/ DISSERTATION
o Attribution — You must give appropriate credit, provide a link to the license, and indicate if changes were made. You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
o NonCommercial — You may not use the material for commercial purposes.
o ShareAlike — If you remix, transform, or build upon the material, you must distribute your contributions under the same license as the original.
How to cite this thesis
Surname, Initial(s). (2012) Title of the thesis or dissertation. PhD. (Chemistry)/ M.Sc. (Physics)/ M.A. (Philosophy)/M.Com. (Finance) etc. [Unpublished]: University of Johannesburg. Retrieved from: https://ujdigispace.uj.ac.za (Accessed: Date).
DIFFERING PERCEPTIONS OF PARTICIPATIVE MANAGEMENT BETWEEN DIFFERING LEVELS OF MANAGEMENT
AT MAKRO SOUTH AFRICA
FOe Labels OVI\VIPIIIIt11111
136A18 115F
BY
THIERRY PAUL FUCHSLOCH
DISSERTATION
SUBMITTED FOR THE PARTIAL REQUIREMENTS
FOR THE DEGREE
M.COM (BUSINESS MANAGEMENT)
IN THE FACULTY OF
ECONOMIC AND MANAGEMENT SCIENCES
AT
RAND AFRIKAANS UNIVERSITY
STUDY LEADER: PROF. S.G. GOUS
NOVEMBER 1989
EBIO FUCII
baS; _
RANDSE AFRIKAANSE UNIVERSITEIT
UNIVERSITEITS- BIBLIOTEEK Tel. 489-2165
VERVALDATUM
. 199 r jf
1992
Vi5)
t 8 12'36
t8 APR 20P7
17 SEF 2007
p .11. 52767
DIFFERING PERCEPTIONS OF PARTICIPATIVE MANAGEMENT BETWEEN DIFFERING LEVELS OF MANAGEMENT
AT MAKRO SOUTH AFRICA
BY
THIERRY PAUL FUCHSLOCH
DISSERTATION
SUBMITTED FOR THE PARTIAL REQUIREMENTS
FOR THE DEGREE
M.COM (BUSINESS MANAGEMENT)
IN THE FACULTY OF
ECONOMIC AND MANAGEMENT SCIENCES
AT
RAND AFRIKAANS UNIVERSITY
STUDY LEADER: PROF. S.G. GOUS
NOVEMBER 1989
11,1. 11E 1,11If, MI1 11,1,11i E 1111, E
II IP
I T 1111) Nil 1 4 1 111 ; 1 0 "1 14111111111 i ff 1,11 11( 114111,itf,1,1 1 /1 11 .1 11111 1115 1111d g 11311111 g 111
00S::11 A1.t4ORA!1 OTB
E3 1- FR et G
Participative management has been hailed as the strategic choice
to overcoming problems at the workplace. It has become a
buzzword for management in the 1980s, and yet has not become
entrenched far enough in South Africa to say that participative
management practice is, and has been a success.
The 1980s have been witness to major Industrial relations
/developments, which have been not only unprecedented, but also a
'/considerable test on South African managers. In a lot of cases - _
participative management is seen as the medicine for overcoming
poor worker relations at the work place, and furthermore as the
management tool for improving productivity.
The primary emphasis of this report was on researching whether
differences exist in perceptions of participative management,
between differing management levels at Makro South Africa.
Differences in perceptions of participative management would
quite clearly determine the success of any such programme, or
style, implemented.
From the research it has become quite clear that differences do
exist in the understanding, and perception of participative
management between differing management levels at Makro. These
differences were not only evident in the broad definition of
participative management, but also to specific ideas on what
participative management is.
From the study it also became apparent that there were differing
perceptions as regards management's commitment to participative
management within the company, and whether or not the climate
within Makro would be conducive to a participative management
style.
Finally, it was quite clear from the study that Participative
management is vaguely understood, and possibly seen as more than
it actually is; a management style and not some sort of
management tool which when implemented will bring harmony at the
work place with improved productivity.
-iv-
KNIOLAJL_
The author- wishes to acknowledge the assistance of:
Employees at Makro who participated in the
study.
Professor S.G. Gous for his guidance throughout
the dissertation.
-v-
EEE ID I C.:: 1- I (:) NJ
To my parents who have provided me with the opportunities I have
had in my life.
To Kerstin who provided the moral support, and typing expertise
for this dissertation.
-vi
F:E3 0 F DES
CHAPTER ONE - INTRODUCTION
1.1 STATEMENT OF THE PROBLEM 1
1.2 RESEARCH LIMITATIONS 4
1.3 OBJECT OF THE STUDY 5
1.4 DEFINITION OF PERCEPTION 5
1.5 PROCEDURE TO BE FOLLOWED 5
1.6 PLAN OF THE STUDY 6
CHAPTER TWO - LITERATURE STUDY
2.1 WORKER PARTICIPATION - SOME CONSIDERATIONS
2.1.1 EVOLUTION OF MANAGEMENT --
2.1.2 AN HISTORICAL PERSPECTIVE ON PARTICIPATION -- 12
2.1.3 WORKER PARTICIPATION - CURRENT ATTITUDES --
2.1.4 THE TRADE UNION AS A PLAYER -- 21
2.2 HISTORY OF INDUSTRIAL RELATIONS IN SOUTH AFRICA -- 25
2.3 THE LABOUR RELATIONS SYSTEM AFTER 1981 AND ITS
USE 28
2.4 CURRENT INDUSTRIAL RELATIONS PRACTICES AND HOW
THEY AFFECT PARTICIPATION 29
2.4.1 INDUSTRIAL COUNCILS 32
2.4.2 CONCILIATION BOARDS 35
2.4.3 MEDIATION 36
2.4.4 ARBITRATION 36
2.4.5 THE INDUSTRIAL COURT 37
2.4.6 UNFAIR LABOUR PRACTICES 38
2.4.7 STATUS QUO ORDERS 39
2.5 QUALITY CIRCLES 39
2.5.1 APPLICATION IN SOUTH AFRICA 41
2.6 WORKER PARTICIPATION IN YUGOSLAVIA 45
2.6.1 THE ROLE OF THE TRADE UNIONS 48
2.7 WORKER PARTICIPATION IN WEST GERMANY 49
2.7.1 PRINCIPLES OF CODETERMINATION 50
2.7.2 UNION INFLUENCE 51
2.8 PRODUCTIVITY RELATED TO PARTICIPATIVE
MANAGEMENT 53
CHAPTER THREE - RESEARCH METHODOLOGY
3.1 SAMPLE SELECTION 60
3.2 METHOD 60
3.3 SAMPLE SIZE 60
3.4 QUESTIONNAIRE DESIGN 60
3.5 LIMITATIONS 62
3.6 TESTING THE QUESTIONNAIRE 63
CHAPTER FOUR - MAKRO SOUTH AFRICA
4.1 HISTORY OF MAKRO IN SOUTH AFRICA 64
4.2 HUMAN RESOURCES PRACTICE AT MAKRO 65
4.3 UNION INVOLVEMENT DESIRED BY MAKRO 66
CHAPTER FIVE - ANALYSIS OF THE QUESTIONNAIRE AND PRESENTATION
OF RESEARCH RESULTS
5.1 SECTION 1 RESPONDENT DETAILS
5.2 SECTION 2 PERCEPTIONS AS TO THE DEFINITION
OF PARTICIPATIVE MANAGEMENT
5.3 PERCEPTIONS OF HOW PROFIT IS RELATED TO
PARTICIPATIVE MANAGEMENT
5.4 PERCEPTION OF HOW POWER IS RELATED TO
PARTICIPATIVE MANAGEMENT
67
83
87
5.5 VIEWS AND ATTITUDES OF PARTICIPATIVE MANAGEMENT
PRACTICE WITHIN MAKRO -- 92
5.6 VIEW OF THE TRADE UNION AND SHOP STEWARDS BODY
AS PARTICIPANTS IN PARTICIPATIVE MANAGEMENT
PRACTICE -- 101
5.7 VIEWS ON THE EFFECT OF PARTICIPATIVE MANAGEMENT
ON WORKER MOTIVATION -- 105
5.8 PERCEPTION OF THE RIGHTS OF EMPLOYEES RELATED
TO PARTICIPATIVE MANAGEMENT -- 107
5.9 UNDERSTANDING OF TRAINING RELATED TO
PARTICIPATIVE MANAGEMENT PRACTICE -- 111
CHAPTER SIX - CONCLUSION
6.1 CONCLUDING REMARKS ON THE RESEARCH 113
6.2 RECOMMENDATIONS TO MAKRO 118
REFERENCES
120
APPENDIX 1 QUESTIONNAIRE
126
APPENDIX 2 LETTER TO RESPONDENTS 135
L IE3 -T- C=3 F=7 -T- Pi 1E3 L__ FEE E3
17 CODETERMINATION AND PARTICIPATION
INDUSTRIAL RELATIONS SYSTEM BEFORE 1979 25
INDUSTRIAL RELATIONS SYSTEM AFTER 1979 27
BASIC DIFFERENCES BETWEEN JAPANESE AND
WESTERN EMPLOYEE BACKGROUNDS AND RELATIONS
WITH MANAGEMENT
42
FIGURE
FIGURE
FIGURE
FIGURE
FIGURE
FIGURE
1_ I B T- CI) F=7 F I C3 Li FR E...=
-- 70
-- 70
-- 71
-- 71
-- 72
-- 72
1
2
3
4
5
6
HOME LANGUAGE - TOP MANAGEMENT
HOME LANGUAGE - MIDDLE MANAGEMENT
HOME LANGUAGE - SUPERVISORY MANAGEMENT
HOME LANGUAGE - TOTAL SAMPLE
SEXUAL COMPOSITION - SUPERVISORY MANAGEMENT
SEXUAL COMPOSITION - TOTAL SAMPLE
FIGURE 7 AGE GROUPS - TOP MANAGEMENT -- 73
FIGURE 8 AGE GROUPS - MIDDLE MANAGEMENT -- 73
FIGURE 9 AGE GROUPS - SUPERVISORY MANAGEMENT -- 74
FIGURE 10 AGE GROUPS - TOTAL SAMPLE -- 74
FIGURE 11 RACE SUPERVISORY MANAGEMENT -- 75
FIGURE 12 RACE TOTAL SAMPLE -- 75
FIGURE 13 HIGHEST EDUCATIONAL LEVEL - TOP MANAGEMENT -- 76
FIGURE 14 HIGHEST EDUCATIONAL LEVEL - MIDDLE MANAGEM8NT -- 76
FIGURE 15 HIGHEST EDUCATIONAL LEVEL - SUPERVISORY MANAGEMENT -- 77
FIGURE 16 HIGHEST EDUCATIONAL LEVEL - TOTAL SAMPLE -- 77
FIGURE 17 LENGTH OF SERVICE - TOP MANAGEMENT -- 78
FIGURE 18 LENGTH OF SERVICE - MIDDLE MANAGEMENT -- 79
FIGURE 19 LENGTH OF SERVICE - SUPERVISORY MANAGEMENT -- 79
FIGURE 20 LENGTH OF SERVICE - TOTAL SAMPLE -- 79
FIGURE 21 PERCEPTION OF PARTICIPATIVE MANAGEMENT -- 82
FIGURE 22 PROFIT AGAINST PEOPLE -- 85
FIGURE 23 SHARING OF PROFITS -- 86
FIGURE 24 POWER AT THE WORKPLACE -- 90
FIGURE 25 POWER VERSUS POLITICAL RIGHTS -- 91
FIGURE 26 TOP MANAGEMENT COMMITTED TO PARTICIPATIVE MANAGEMENT -- 97
FIGURE 27 IS COMMITMENT NECESSARY -- 98
FIGURE 28 MANAGEMENT STYLE FAVORABLE -- 99
FIGURE 29 COMMITTED YES OR NO - 100
FIGURE 30 PARTICIPATION FOR WHOM - 103
FIGURE 31 UNION AND MANAGEMENT MAKE DECISIONS - 104
FIGURE 32 PARTICIPATION ALLOWS FOR MOTIVATED EMPLOYEES -- 106
FIGURE 33 EMPLOYEES DECIDING ON COMPANY OBJECTIVES -- 108
FIGURE 34 THREATENED TO LOSE YOUR JOB -- 109
FIGURE 35 TRAINING NECESSARY TO PERFORM -- 112
-1--
C F) -T- EEE FR ED r\J EEE --- I NJ -T- FR CE) ID L_J CE3 -T- I CD NJ
1.1 STATEMENT OF THE PROBLEM
Productivity in the 1940s and 1950s meant volume output - the
more the firm could produce the higher its productivity. In the
high demand years of the 1960s and 1970s productivity meant
efficient operations at lower cost. And now, in the 1980s the
terms productivity and quality are used as complementary
concepts to guide the overall improvement efforts of the
organisation. (Landel, 1986:1-3). The question posed by
management today is how do we lower costs and increase product
quality through the unique creative energies of the human
resources. As Raymond Ackerman (1982:20), says "productivity is
trying to do things more efficiently, getting motivated people
to achieve company goals with a feeling of dedication for what
they're doing"
Money plays a very important role and there is no question, the
flexing of muscles of the unions is forcing management to really
sit up and say "hey, am I really paying enough?" (Ackerman,
1982:20)
Managers in South Africa today must realize that the limits on
human collaboration in the organizational setting are not limits / of human nature, but of management ingenuity discovering how to
realize the potential of its human resource. If employees are
lazy, unwilling, indifferent, to take responsibility,
uncreative, or uncooperative, the cause lies with management's
view of the potential of the workers.
-2-
Managers truly believe that he or she is accomplishing just
about all that can be accomplished with the resources that are
available. It's only natural, therefore, that when pressed for
greater output, that most managers will call for better
equipment, new or improved systems, or new or better people.
Yet many senior executives who have provided these requested
investments have been frustrated and dissatisfied. Despite all
inputs, the expected results do not occur. The reason is that a
fundamental point is being overlooked: with rare exceptions,
significant performance improvements cannot be generated by
making an investment in new equipment, new systems, and or new
people. Such improvements require the highest order of
managerial action to process what's available. The answer lies
in managing productivity by way of introducing the management
methods and disciplines to sustain performance improvement.
Although participative management has become a buzzword for
management in the 1980s it has not entrenched itself far enough
yet for us in South Africa to say that participative management
practice is and has been implemented with success. With
increasing costs driven by rampant inflation, political pressure
and sanctions, coupled with increasing labour-union pressure
many organisations have looked toward participative management
practice. South Africa remains, however, a novice at this "new"
management intervention.
-3--
The problems associated with introducing participative
management technology was that some people dismissed it by
saying "That Japanese idea won't work here because our people
aren't sufficiently educated, trained, sophisticated etc,
etc...." (Evans, 1986:9). Clearly there are significant social
and cultural differences between Western and Japanese lives and
it is crucial for South African managers to take cognizance of
them. One cannot plug overseas participative management models
"voetstoots" into the South African Organisation and be sure
that it will bring productivity as well as employee satisfaction
(8ocker and Overgaard, 1983:17).
An understanding of differing perceptions of what participative
management is, and what it means to different people at
differing levels of the organisation, is crucial to the
implementation of any such system. Without a clear
understanding of these differing perceptions organisations have
no clear directive as to what form of participative management
to use and secondly , how to implement it with success.
-4--
1.2 RESEARCH LIMITATIONS
It would be impossible to determine perceptions of participative
management throughout the entire Industry, in a study of this
nature and size, and consequently this study will concentrate on
determining perceptions of:
Top Management - Categories A - E at Makro
Middle Management - Categories F - J at Makro
Supervisory Management - Categories K - L at Makro
In the wholesale Industry, and more specifically at one of the
leading wholesale Companies in South Africa namely Makro (South
Africa)
Random sampling will be used to draw a sample of the population,
which will ensure that each member of the population has an
equal chance of being selected.
1.3 OBJECT OF THE STUDY
The object of this study is to determine whether or not
perceptions differ between the management levels (as defined) at
Makro, and if so, to what degree these differences will
influence the implementation of a participative management
system and culture.
Within this broad objective a closer examination will be made of
specific factors that contribute to differing perceptions of
participative management between said levels of management.
1.4 DEFINITION OF PERCEPTION
For the purposes of this study "perception" will be defined as:
"Knowledge acquired through the senses, and cognition of fact or
truth by the activity of thinking. Any insight or intuitive
judgement of fact or truth".
1.5 PROCEDURE TO BE FOLLOWED
The study will follow the sequence tabled below:
1) Literature Study A literature study will be
undertaken to: a) Discuss and compare current
ideas of participative management.
b) Consider the role of Industrial
relations in participative management.
c) Consider participative
management in other countries.
-6-
2) Empirical Study - A questionnaire will then be
distributed to the management levels, already
mentioned, to gather the necessary data so as to
provide information regarding perceptions of
participative management.
Questionnaires will be distributed as follows:
Top Management 16
Middle Management 19
Supervisory Management - 18
1.6 PLAN OF THE STUDY
CHAPTER ONE - INTRODUCTION
This chapter will be an introduction to the dissertation stating
the problem and forwarding the object of the study.
CHAPTER TWO - LITERATURE STUDY
This chapter will be the literature study of the dissertation
and look specifically at:
The history of management.
What participative management is all about.
The effect of organised labour on
participative management.
Participative management in other countries.
Productivity related to participative
management.
-7-
CHAPTER THREE - RESEARCH METHODOLOGY
This chapter will highlight the questionnaire in terms of how it
was designed and what aspects of participative management it
will be questioning.
CHAPTER FOUR - MAKRO SOUTH AFRICA
This chapter will present a brief synopsis of Makro South
Africa.
CHAPTER FIVE - RESEARCH RESULTS
This chapter will present the results of the analysis of the
questionnaire.
5) CHAPTER SIX - CONCLUSION AND RECOMMENDATIONS
This chapter will present the conclusions of the study.
-8-
G fa F.. 1- — L_ I -1- I- FR AY Li F=2 U D sse'
2.1 WORKER PARTICIPATION - SOME CONSIDERATIONS
2.1.1 Evolution of management
The combined efforts or energy will always be greater than the
separate parts. This is one of the premises upon which
production is built. Today's organisation is a dynamic one,
where the modern manager operates in a dynamic system with
rapidly changing technologies in an increasingly complex
environment. The development of organizational practice is
strongly influenced by these forces.
The evolution of values are also critical in the development of
management thought. Capitalism has evolved, and transformed
itself over time, which has been significantly affected by
changing sociocultural values. A number of historians consider
the changes in religious values and attitudes as an important
basis for the development of the capitalist ethic.
By the mid 1770s Capitalism was well entrenched in Europe. Adam
Smith with his publication in 1776 of "An enquiry into the
nature and causes of the wealth of nations" dominated economic'
thought (kast & Rosenzweig, 1985:29.)
Charles Darwin's concept of the survival of the fittest
propagated that the most capable and resourceful people would
rise to the top of the social hierarchy. It was only natural
that there would be rich and poor classes, and any attempt to
upset this hierarchical order was considered unnatural and
against the best interests of society. (Kast & Rosenzweig, 1985:
15)
-9-
Social Darwinism provided the basic ideology for the
practitioner in the late 19th century and justified the
accumulation of resources and their use for self-interest.
There were those who dissented this Ideology. The most famous
Karl Marx who wrote the Communist Manifesto with Frederick
Engels in 1848, and Das Kapital in 1867. They saw the
Capitalist system as a threat to the social culture and
recommended revolutionary remedies.
Today in the 20th Century, the Capitalist ethic continues to be
acceptable practice, throughout the Western World. In the
1980s, however, there has been concern over continuing reliance
on a laissez faire philosophy and market forces to determine
industrial structure, and economic well being.
Decline in the rate of productivity improvement , high
inflation, severe recession, and high levels of unemployment, in
South Africa, have led to increasing questioning as regards the
effectiveness of a working Capitalist ethic.
There have automatically been significant changes in the
Capitalist Ideology and in societies view the legitimate role of
the manager and the corporation. Heil Broner (Kast &
Rosenzweig, 1985:44) summarises this change "in the concept of
new Capitalism, distinguished by its sense of professional
responsibility, characterised by large-scale technological
units, imbued with a concern for human values, and aware of the
legitimacy of labour and Government as centers of economic
powers, we have an expression, however incomplete, of what
capitalism means that is markedly different from what it meant
to the late nineteenth - or early twentieth - century big
businessmen and considerably different from the lingering
conservative depiction today." (Kast & Rosenzweig, 1985:44)
-1 0-
Today's employee
With the legitimacy of labour we have witnessed
the human resource assuming rights and wants within the
organisation.
Employees today want:
A successful, dynamic, growth oriented business.
A normative culture.
Fair rewards (extrinsic) linked top performance and
contribution.
Ability to contribute and develop to full potential.
Recognition and feeling of personal value / worth.
Quality leadership.
Perceived equal opportunity and equity / fairness.
A clear and meaningful purpose / vision / course.
In South Africa management is generally autocratic in style and
assumptions such as these listed below are made:
Work is inherently distasteful to most people.
Most people are not ambitious, have little desire
for responsibility and must be and prefer to be
directed.
Most people have little capacity for creativity in
solving problems.
Motivation occurs only at the physiological and
safety levels.
Most people must be closely controlled and often
coerced to achieve organizational goals and
objectives. (Coetzee, 1988:1)
In many organisations, formal structured lines of communication
have been the main focus. Too much reliance on content or
loutdated methods and packages which do not apply or fit well
enough into South Africa's requirements is another cause for our
problems.
' Llrthermore, vast amounts of money are being spent by
inexperienced managers, while it can safely be said that human
resource departments are not strong enough.
-12-
In recent times where much emphasis is placed on inter-group
relations and communications, it is often found that lip service
is paid to the bridging of cultural and racial differences.
Changing conditions and circumstances are frequently glossed
over and their effects ignored.
Business leaders and professional consultants should be much
more involved in the change process and to facilitate training
and development. Creativity and problem solving abilities have
been sadly lacking within organisations which has also inhibited
the possibilities of more participative styles of management to
infiltrate the South African Organisation.
2.1.2 An historical perspective on participation
The notion of employee participation has since the early
Twentieth Century received its initial stimulus from the
writings and empirical studies of Frederick Taylor and Elton
Mayo (Roethlisberger and Dickson, 1939:160.)
The Scientific Management approach of Taylor tended to regard
the needs of workers as primarily economic and that only the
physical or mechanical aspects of work were important. Taylor
believed that output of the average worker could be improved
through study and analysis. He made time and motion studies
popular and introduced piece work to reward productive workers.
Although scientific in his approach Taylor received criticism
for his allegedly oversimplified or non scientific approach to
the role of the human element in management. Taylor believed
that workers were generally idle and that only economic
incentives and coercion would make them productive.
-13-
The Hawthorne Studies are regarded as the pioneering work from
which the human relations approach to management developed. The
primary findings of the experiments (in which thirteen variables
including the effects of illumination, length of working day and
length of rest pauses were considered) conducted in the Western
Electric Company were that variables such as style of
supervision and the social pressures from informal work groups
used to gain compliance to group norms, were important factors
influencing work output.
The Hawthorne studies provided scientific verification for the
changing view of many students of industrial organisations in
that the human element was regarded as part of the organisation
over and above capital and machinery.
The studies led to new approach to the study of management.
Management became defined as getting work done through others.
Management training began to concentrate on motivation,
leadership styles, informal groups, job enrichment,
communication, conflict, and resistance to change.
Leadership Studies conducted by Social Scientists have since the
1930s focussed on the differences between the leadership styles,
and have tended to advocate the benefits of participative
leadership styles.
-14-
In 1945 the Ohio State Leadership studies, using a leader
behaviour description questionnaire, analyzed leadership in
numerous types of groups and situations, including Air Force
Commandos, teachers and manufacturing foremen. (Stogdill and
Coons, 1957:1-3)
The Michagan Studies of leadership styles found that supervisors
of high-producing sections at the Prudential Insurance Company,
New Jersey, were significantly more likely to give general
rather than close supervision to their employees and were more
employee-orientated than production-oriented.. (Likert in
katz, Maccoby and Morse (eds.), 1950:62)
Douglas Mcgregor's theory X and theory Y added further impetus
to the human relations movement by differentiating between
theory X or authoritarian type of management (with its negative
assumptions about man's inherent dislike of work, 'requiring him
to be coerced to achieve organisational objectives - a notion
similar to the Taylorian Scientific view and theory Y, which
holds that man seeks responsibility and that work is as natural
as play or rest (McGregor, 1960:33-34).
The more recent Managerial approach of Blake and Mouton
similarly distinguishes between a concern for production, theory
X, and a concern for people, theory Y. (Hersey and Blanchard,
1977:97-100) In the Managerial grid five different types of
leadership are located in four quadrants similar to those
identified by the Ohio State studies. The model is based upon
concern for people on the one axis, and concern for production
on the other. The high concern for both production and concern
for people is considered as an ideal form of participative
management. Excessive concern for either people or production
is seen as an ineffective managerial orientation.
-15-
Many behavioural scientists emphasise the value of more
democratic, less authoritarian, less hierarchically structured
organisations than proposed by traditional protagonists
including Taylor. The manager of the organisation of today, has
become more involved in the management of people, taking
cognizance of the needs of the employee.
2.1.3 Worker participation - current attitudes
The principle underlying worker participation is that the people
who will be affected by decisions should be involved in making
these decisions (Kachelhoffer, 1979:39 ) As such, participation
is linked to the concept of industrial democracy. Whether or
not participation does in practice contribute towards industrial
democracy depends on the nature and degree of worker involvement
in decision making ie. how much involvement does the worker 2
actually have in that decision making exercise?
It is useful to distinguish between consultation, on the one
hand, and co-determination on the other when trying to clarify
what participation means.
Consultation (normally joint consultation) involves an attempt
to influence decision making. In a consultative system, the
responsibility for all decision making remains with management.
A more comprehensive definition is offered by Hovels and Nas,
(1977:119) where joint consultation is defined as, "The
independent formulation of problems concerning any aspect of
management policy by elected members on behalf of workers and
from the point of view of the employees, its discussion with top
management and the attempt to influence top management policy on
such a basis".
Consultation is generally regarded as a weak form of
participation and some writers do not regard it as a form of
participation at all. (Poole, 1978:76)
The main principle of co-determination is that workers enjoy
actual control over and authority for certain decisions (Poole,
1978:79). Bendix, (1978:6) provides a concise view on
co-determination in that "it implies a range of co-decision
rights and makes a decision of the employer dependent on the
consent and approval of employees". As with consultation ,
co-determination may take place on different levels - shop
floor, board, industry, etc. The scope of co-determination may
vary, in terms of the range and activities within which
participation occurs, or in terms of the kinds of decisions that
workers may be involved in. One must distinguish for example,
decision making about aims, goals and ends, from decision making
about means. One would expect under co-determination workers
having decision making powers in matters such as personnel
policy and practices (hiring, firing, redundancies ),
remuneration and working conditions, welfare and socio-economic
issues (health, safety, pension) and so on.
As far as rights that workers enjoy under co-determination are
concerned , they are certainly far stronger than rights under
consultation.
Another distinction that is necessary to make is that of direct
and indirect participation. Direct participation would be
participation of workers in shop-floor, job related decisions,
and indirect participation, through Trade Union representatives.
0
A
0
-17-
HIGH CO-DETERMINATION
DIRECT PARTICIPATION
HIGH CO-DETERMINATION
INDIRECT PARTICIPATION
LOW CO-DETERMINATION
DIRECT PARTICIPATION
LOW CO-DETERMINATION
INDIRECT PARTICIPATION
PARTICIPATION
TABLE 1
The table indicates these two concepts quite well, indicating
that parties to the participative process may elect between
co-determination or consultation irrespective of whether direct
or indirect participation is preferred.
-18-
To make a choice between what form of participation parties will
elect will be preempted by the question "What are the effects of
participation?" Perhaps the question of participation should
be viewed not in terms of its potential threats but rather in
terms of its effects on workers, managers, and the
organisation. Conclusive evidence on participation's effect in
South Africa is meagre however and making a choice of the form
of participation to employ is therefore difficult.
It is often assumed that participation in decision making
implies greater control by workers over aspects of their working
lives and an augmentation of their power vis a vis management.
As Mulder and Wilke, (1970:2) put it, participation has been
assumed to reduce power differences in organisations, and has
been regarded as a form of power equalisation. Power
equalisation is defined as "a process of reduction in the power
differential between people....on two levels in the formal power
hierarchy" (Mulder and Wilke, 1970:22).
Mulder and Wilke, (Mulder and Wilke, 1970:23) have questioned
the assumption that participation reduces the power differences
between workers and managers in that it leads to power
equalisation. In a number of experiments he has shown the
contr'ary takes place - participation leads to power distance
between the two parties. He ascribes the reason for this as
participation seldom involving interaction among equals. The
parties usually involved are unequal in many respects. Firstly
there is a difference in the functions that said parties perform
within the organisation. Those at the higher levels of the
formal authority structure tend to have more information at
their disposal, and more knowledge, than those at the lower
levels, on issues relating to the organisation, financial
resources, the relation between production and technology and so
on. They are therefore in a better position to make decisions
affecting the organisation, and furthermore to justify such
dectsions.
-19-
Mulder and Wilke, (Mulder and Wilke, 1970:29) make
reference to expert power (knowledge information expertise)
which managers, rather than workers have at their disposal.
This expert power, according to Mulder, is potential influence
which through interaction with others may be turned into
effective influence.
Greater participation then, rather than bringing about power
equalisation, enables the ones with more expert power to
increase their effective influence over the participants,
according to Mulder and Wilke. (Mulder and Wilke, 1970:35)
Another factor, not quite as well developed, in Mulder and
Wilkes work, is the difference in motivation. Effective
participation, requires_ strong motivation on the part of both
management and workers. Low motivation, which could be linked
to lack of self confidence, reinforces expert power, and makes
the less powerful more susceptible to being influenced by the
more powerful.
This then is the danger of consultative schemes, that they
depend on the holders of formal power (that is management) for
participation to take place. Therefore if workers have no
formal power it is unlikely that effective participation will be
possible.. An additional danger lies in the mere "appearance of
participation". Im such a situation worker representatives are
satisfied with their councils or committees, because of their
involvement in these. They may claim to be able to influence
decisions, and that they are 'equal partners' with management,
while in fact management remains the sole decision maker and no
real participation takes place (Hovels and Nas, 1977:130)
According to Douwes Dekker (Douwes Dekker, 1973:12) most
managers perceive power to be a fixed sum. That is, any gain on
the part of the workers is experienced as a loss. Management
will then set up pseudo-participation systems to regain control.
(Douwes Dekker, 1973:12)
-20-
However, if power can be shown, through experience, to be an
expandable commodity, the union will not be perceived as a
threat. - A critical distinction to clarify the nature of
worker's participation in decision making is between direct and
indirect participation. In direct participation the emphasis
falls on interaction between the individual worker and his
supervisor, as well as co workers as a means to influence the
way work is carried out. This form ranges from suggestion
schemes to Job enrichment programmes and autonomous work groups
such as quality circles. The latter represents the most
commonly accepted meaning of the labour relations approach to
Industrial Relations. This form of participation is
interaction through a Joint union management body.
The indirect system of workers participation requires ground
rules to govern the interaction and to facilitate the
empowerment of the union and its representatives to ensure the
implications of distance inherent in the hierarchical structure
is narrowed and a near power balance achieved.
Throughout Western society, managers often tend to view
participation as an interference of political ideology in
running the business. Hethy and Mako in their study of workers
participation in Hungarian factories, argue that participation
is a tool by which to strengthen the co-operation of people.
(Hethy and Mako, 1977:1-4)
Hethy and Mako, (1977:4) concluded that the lower level (plant)
and short range (operational) decisions come closer to and more
directly concern the workers' interests than higher level
(company) and long range (strategic) decisions. In other words
the influence of workers and representative bodies decrease as
one moves from short-term to long-term decisions. Decision
making, according to Hethy and Mako, (1977:4) consists of
several phases including problem identification, problem
-21-
analysis, formulating alternative strategies for its solution
choosing
the most
appropriate alternative, actioning the
decision and finally, reviewing. Furthermore Hethy and Mako,
(1977:5)
argue that direct participation tends to occur in
some, but not all the phases of decision making.
An important facet of the decision making variable is the
worker's willingness and ability to participate. This
propensity to participate appears to be dependent on several
factors, particularly the workers assessment of the costs and
benefits of participation. Inevitably worker participation
implies not only participation in management decisions, but also
a share of managerial rights, tasks and responsibilities. (Hethy
and Mako, 1977:1-4)
2.1.4 The trade union as a player
In July 1984 Unisa's School of Business Leadership released the
results of the first phase of Project Free Enterprise. Based on
the data gathered from 3723 questionnaires submitted to the
personnel of 7e of South Africa's leading organisations, these
results identified critical issues for management.
The most important perceptions of the workforce with the most
alarming implications for Business in terms of improving
quality, productivity and employee commitment were:
Businesses are funded from limitless resources of
capital provided largely by banks and government.
Revenues and profits are largely used for management
bonuses and salaries and for government taxes.
-22-
There is little or no understanding of the need for
productivity and for an organisation to generate its
on capital.
Sources for providing increased wages for workers
are seen as paying whites less, increasing product
prices and obtaining loans. -
There is consensus from all levels of the workforce,
including management, that increasing prices is the
most effective way of creating revenue for wage
increases.
Business is seen as being exploitative,
discriminatory and as profiting only (white)
management.
These perceptions are an important contributor to an already
poor quality and productivity record in South Africa. An
important consideration is that quality and productivity
improvement, is effectively nullified by these worker
perceptions. (Executive overview, Project free enterprise
1987:4)
Essentially both quality and productivity are irrelevant to
workers who feel that they do not participate in, or benefit
from, the business system.
The micro analysis enabled the project to determine the
perception of management regarding the major issues that need to
be addressed by the Business sector. The priorities from which
the ultimate four major priorities were formulated were:
1. Management commitment.
2. Participative systems ie. systems such as
quality circles and briefing groups.
-23-
3 Interface management. Managing problems at the
interface level. ie . where management - generally
white, and the workforce - generally black, asian
or coloured, meet.
Monetary reward. ie . increased incentives for
improved performance.
Black advancement.
The business sector's efforts to address the strategic
priorities at the micro level are generally in an early,
exploratory and immature phase of development. The phase is
typically characterised by the search for clear-cut goals,
initial errors in implementation, wastage and a feeling of
crisis. However, constructive action usually achieves quick
results in this phase.
The research revealed that management considered that they had
already laid much of the groundwork for developing the strategic
action plans identified. Nonetheless, the following findings
make it clear that there is much more practical and goal
orientated work to be done.
There is a large discrepancy between the
perceptions of management and workers as to how
much has in fact been achieved.
Management tends to be satisfied with broad,
generic statements of intent, rather than
implementing specific action steps.
Management pays lip service to some important
issues, eq. Black advancement and incentives.
Top and senior management intentions are not
properly communicated down the line or are
disbelieved.
-24--
Some of the basic findings of the study are tabled below. They
are tabled in no specific order of importance.
The exclusion of workers from meaningful participation
undermines the very essence of organisational survival -
quality, productivity and growth.
The most effective means of gaining understanding and
commitment to the process of business, as well as ensuring
personal development, is the encouragement of worker
participation.
The major priority in ensuring that participative systems
work within an organisation is to ensure that they are
viewed and practised as a total philosophy of management.
Management is generally still guilty of totalitarian and
autocratic styles of management that negate or prevent any
meaningful participation by workers in basic processes such
as performance improvement, productivity enhancement, and
decision-making.
Knowledge, awareness and insight are crucial to
participation. The dissemination of information is thus a
key issue in maintaining participative systems.
Much of the success of participative systems depends upon
employees understanding of why a company needs to make
profits in the first place.
It should be noted that participative systems were at no stage
viewed as being participation by workers at the highest levels
of management for the purposes of the study. It was
realistically described as managerial ability and intent to
involve workers in the day to day activities which they need to
perform in order to ensure the efficient and on-going running of
the organisation. (Executive overview, Project free enterprise,
19E17:5-8)
-25-
2.2 HISTORY OF INDUSTRIAL RELATIONS IN SOUTH AFRICA
Before 1979
Before the Wiehahn investigation there were two major laws
controlling I.R. in South Africa. The Industrial Conciliation
Act covered White, Asian, and Coloured workers, whereas the
Black Labour Relations Regulations Act covered Black workers.
INDUSTRIAL BLACK LABOUR I
CONCILIATION I RELATIONS
ACT REGULATIONS ACTI
I I I 'MINISTER OF!
I LABOUR I
1 1
1
NATIONAL INDUSTRIAL'
COUNCIL
1 MINISTER OF I
LABOUR
I I
1 1 1 1 1 IWAGE AGREEMENTS ETC. I I CENTRAL I I
A 1 IBLACK LABOUR'
I BOARD I
1 'TRADE UNION!
I EMPLOYER I / 1 I N
I FEDERATION' IEMPLOYEESkI COMPANY
I I I I LIASON OR A
WORKS
I COMMITTEE
I WHITES I I EMPLOYERS I
I COLOUREDS I
I ASIANS I
T I I BLACKS I
TABLE 2
(TINS ITEMS, 1988:2)
A.
A
-2-
As you can see from this diagram, Whites, Coloureds, and Asians,
under the Industrial Conciliation Act, could belong to a trade
union of their choice. This trade union would represent these
employees when negotiating with employers who belong to the
Employer Federation. This whole system was under the Industrial
Council system with the Minister of labour being the highest
authority.
Blacks however were not covered under the Industrial
Conciliation Act and were not allowed to belong to a registered
trade union. This was not very fair as Blacks make up 70 % of
the South African labour force and they also wanted recognised
union membership. Because Blacks were not covered under the
Industrial Conciliation Act, there was another law called the
Black Labour Relations Regulations Act which was only for
Blacks. (Natrass, 1984:35)
This act allowed Blacks to form either Liaison or Works
Committees, which were seen by the Government as a replacement
for unions. These committees would negotiate with the employer
on all matters and were controlled by the Central Black Labour
Board. These committees however did not really work well as
they were a very poor replacement for proper trade unions.
Trade Unions get their strength from their membership and
independence from the employer, and the liaison/works committees
did not have 'members and were also not independent from
employers and management. Professor Nic Wiehahn recognised the
weakness of the committee system, and he proposed that both the
Industrial Conciliation Act and the Black Labour Relations
Regulation Act be done away with and combined into one law which
would be for all racial groups. (Natrass, 1984:27-28)
-27-
AFTER 1979
I LABOUR RELATIONS ACT I
f 1 I TRADE I I EMPLOYERS I
<.. > I I UNIONS I !FEDERATION !
I I I
!
IEMPLOYEESI IEMPLOYERSI IEMPLOYEESI !EMPLOYERS!
1 1 ! 1 ! I 1 i
White
Asian
White Asian
Black
Coloured
Black Coloured
TABLE 3
(TINS ITEMS, 1988:3)
The new Labour Relations Act came into being in 1981 to replace
the previous two laws. This new act applied to all racial
groups and allows all employees the right to belong to an
external body (trade union), and to be represented by an
internal Works Council within the company which will deal with
smaller areas of dispute. A revised Bill was put before
Parliament in August 1988 and certain amendments suggested by
the National Manpower Commission were adopted in early 1989.
INDUSTRIALI I WORKS I
I COUNCIL I COUNCIL I
A
An
-2B-
So we can see that the Labour Relations Act is the most
important labour law in South Africa today. It grants the right
to all employees, regardless of race, to belong to a trade union
if they choose. The basic purpose of this act is to provide for
the negotiation and settlement of disputes on labour issues
within South Africa.
2.3 THE LABOUR RELATIONS SYSTEM AFTER 1981, AND ITS USE
The Labour Relations Act, or as it was called until the August
1981 amendments, the Industrial Conciliation Act, is the
cornerstone of the South African system of labour relations,
because it provides, through the medium of industrial councils,
the forum within which employer representatives, and employee
representatives can come together to negotiate binding
agreements on wages and conditions of service, enforceable in
terms of South Africa's industrial legislation. In addition,
the Act provides for the registration and regulation of
employer's organisations, trade unions and federations of trade
unions, as well as for mediation, conciliation and arbitration
machinery to settle -disputes which may arise between employers
and employees.
-29-
2.4 CURRENT INDUSTRIAL RELATIONS PRACTICES AND HOW THEY
AFFECT PARTICIPATION
If we tried to give a definition of Industrial Relations we
would say that it has to do with the relationship between an
employer and his employees, which is influe'nced by rules,
guidelines, procedures and laws. The field of I.R. covers many
topics including:
The relationship between trade union and company.
The negotiations between management of a company and
either a trade union or some other employees' body such
as a works council or workers committee.
The situation of strikes by employees or lockouts by
employers (the employer "locks" his employees out of
the work place and decides not to let them work).
The method in which grievance and discipline
situations are handled.
The whole set of laws covering labour setting out:
minimum wages, minimum leave conditions, hours of work.
The law is also vital in setting out the relationship between
employer and employees. In the past 80 years the Government has
passed many laws which have to do with people at work. These
laws cover wages, safety, sick leave, hours of work and many
other subjects. The single most important law in the Industrial
Relations scenario is the LABOUR RELATIONS ACT which governs the
activities of companies and trade unions.
-30-
Among the various forms of participation, some already
mentioned, collective bargaining is the most widespread and the
most generally acceptable in both Industrialised and developing
countries. (Cordova, 1982:195)
Although it is usually carried out by representatives, it may
also involve individual workers in the preparation of the list
of demands, the appointment of negotiators and the ratification
of agreements. Collective bargaining is also a highly flexible
and functional process capable of evolving and adapting to the
most different circumstances.
Most countries havp approached worker's participation from more
than one angle and it has manifested itself in many forms. One
can however consider four forms of participative management as
common practice in most Western countries:
Participation at shop floor level.
Works councils.
Collective bargaining.
Representation on company boards.
The systems of self-governance in industry by means of
collective bargaining between employers and employees has
operated for a number of years in South Africa. The success of
the system, however depends on the voluntary association of
employers and employees into organisations competent to
represent their member's interests.
-31-
Not any trade union or employers organisation can gain
registration under the Act. This is an important factor since
registration confers certain benefits upon the organisation, not
the least of which is the right to become a party to an
industrial council, and thereby negotiate agreements which can
be made binding in law, with criminal sanctions for
contravention.
In order for a trade union or employer's organisation to become
registered, proof has to be furnished to the Industrial
Registrar that the organisation is sufficiently representative
of the interests it seeks to represent, and the organisation
will be registered for the areas and interests in which it is
sufficiently representative.
No union will be registered unless the Registrar is satisfied
that:
The requirements set out in the Act concerning registration
have been complied with;
The constitution of the union is consistent with the Act,
and does not contain provisions which are contrary to the
provisions of any law, or are calculated to hinder the
attainment of the objectives of any law, or are unreason-
able in relation to the members of the public; and
The union has not been formed for the purpose of evading
the provisions of any law, and is not affiliated to any ,
political party. (People and Profits, Dec 1981:15 -16)
-32-
Neither trade unions nor employers' organisations are, however
required by law to become registered, and unregistered trade
unions are therefore not illegal. Unregistered unions have to
however comply to a large degree with the rules and regulations
which apply to registered unions. These rules and regulations
are the following:
The union must furnish the Registrar with a copy of its
constitution, its head office address and the names of
its office bearers and officials.
It must keep proper registers and books of account;
It must notify the Registrar of any changes of con-
stitution;
Its officials may not vote at meetings of its executive
committee;
It is prohibited from affiliating to a political party;
(Peoples and Profits, Dec 1981:15 - 16)
2.4.1 Industrial Councils
An industrial council is a forum within which registered trade
unions and employers meet and bargain in order to formulate an
agreement over conditions of employment.
An industrial council is set up voluntarily by the parties
concerned and, provided the requirements of the Act are complied
with, the council will be registered.
-33-
In all cases the employer and the trade unions parties have an
equal number of votes on the council. Some councils consist of
five or six trade unions and dozens of employer organisations
while others are made up of only one union and one employer.
Some industrial councils have jurisdiction over the entire
country in respect of a particular industry while others have
jurisdiction over only a particular area of the country. It is,
therefore, possible to have several industrial councils for the
clothing industry but by the same token, to have only one for
the engineering industry. This also does not mean that there
could not be several industrial councils for the engineering
industry, if the interested parties concerned decided that they
wanted more than one industrial council. An industrial council
can have its area of jurisdiction extended if there is proof
that the members of the council are sufficiently representative
in the new area.
Industrial councils are financed from small levies paid by
workers and the employers, which pay for the administration of
the council. The primary function of an industrial council is
to maintain industrial peace. It must therefore try to prevent
and settle disputes by the negotiation of agreements. An
industrial council agreement may include provisions covering a
large number of matters listed in the Act. Generally these
agreements include provisions relating to wages, hours of work,
overtime, holiday bonus, fringe benefits, and any other matters
affecting the remuneration or other conditions of employment of
all classes of employees. (Tims Items, No. 1:4)
Industrial council agreements are submitted to the Minister of
Manpower and if gazetted they then become law, and are binding
upon all employers and the employees covered by the jurisdiction
of the council. (Tims Items, No. 1:5)
-34-
It is the function of an industrial council to settle any
disputes arising between employers and employees subject to its
jurisdiction. The constitution of the council will make
provision for the procedure for dealing with such disputes.
The industrial council has a duty to settle disputes between
employers or employers' organisations and employees or trade
unions who are within its registered scope of jurisdiction, even
though they may not necessarily be parties to the council.
The usual practice in an industrial council constitution for
dealing with disputes is to provide for a "cooling off" period
in the event of a deadlock. The council would then hold at
least three further meetings in an attempt to settle the
dispute, with no more than two meetings being held on any one
day. The "cooling off" period would thus last at the very
minimum two days, but could well extend over several weeks or
months. (People and Profits, Dec 1981:17)
If the parties to the dispute are, however, unable to settle,
they may (if they agree to do so) apply to the Minister of
Manpower for the appointment of a mediator or they may decide to
refer the dispute to arbitration. Some industrial councils have
constitutional provisions whereby it is compulsory for
unresolved disputes to be referred to arbitration. (Tims Items
No. 1:5)
If an industrial council is unable to resolve a dispute
concerning an unfair labour practice within 30 days (or any such
further period as the Minister may fix), the dispute must be
referred to the industrial court for determination. (People and
Profits, Dec 1981:18)
-35-
2.4.2 Conciliation Boards
A conciliation board is an ad hoc body consisting of an equal
number of employer and employee representatives. Where no
industrial council exists, a conciliation board may be set up by
the Minister to resolve a particular dispute. -When the board
has completed its task it is discharged. An unregistered trade
union or employers' organisation, representative of the
employers or employees concerned, and which has complied with
various provisions of the Act (such as submitting a copy of its
constitution to the Industrial Registrar), may also apply for
the establishment of a conciliation board. The minister of
Manpower makes the agreements between the parties to a
conciliation board binding, by publishing the agreement in a
Government Gazette. The agreements remain binding for a period
fixed by the Minister (Tims Items, No. 1:5) Failure by the
conciliation board to settle a dispute can open the door to a
legal strike after the correct procedures have been followed.
The parties to the dispute may, however, choose to refer the
dispute to either mediation or arbitration. If a conciliation
board fails to settle a dispute concerning an unfair labour
practice, the matter must be referred to the industrial court
(People and Profits, Dec 1981:17)
-36-
2.4.3 Mediation
An industrial council or conciliation board may request the
Minister to appoint a mediator to assist in settling the
dispute. A mediator is a go-between to effect an agreement
between the two parties. In doing this the mediator has to rely
on persuasion: he has no powers of compulsion and he cannot
impose an agreement upon the parties.
2.4.4 Arbitration
An industrial council or a conciliation board may voluntarily
decide to refer a dispute to arbitration. In the case of a
prescribed essential service, however, arbitration is
compulsory. In addition, some industrial councils provide for
compulsory arbitration in their constitutions. The findings by
the arbitrators in either voluntary or compulsory arbitration,
if these take the form of an award, are binding upon both the
employer and employee parties who were party to the original
dispute, and who are members of the organisations which
instituted arbitration proceedings (Tims Items, No. 1:6)
-37--
2.4.5 The Industrial Court
The industrial court was established by the Labour Relations
Amendment Act of 1979, to replace the former industrial
tribunal, but with considerably extended powers. Further
provisions regarding the composition and function of the court
were made in the Labour Relations Amendment Act of 1980. The
court has jurisdiction in all the provinces of the Republic, and
can conduct a sitting at any place. It has no fixed programmes
of sessions and can sit as frequently as it deems necessary.
(People and Profits, Dec 1981:18)
The functions of the court are:
To decide on issues of conflicts of interest and rights;
To determine whether a labour practice in a specific
instance is unfair or not. Thereby the court will set
precedents which will serve as guidelines for subsequent
cases;
To enquire into and report back on any matters referred to
it by the Minister of Manpower regarding the objects of the
Labour Relations Act; (People and Profits, Dec 1981:18)
-38-
2.4.f Unfair Labour Practices
The concept of unfair labour practices was introduced in the
1979 amendments to the Act. In further amendments made in 1980,
an unfair labour practice is now defined as:
(a) any labour practice or any change in any labour practice,
other than a strike or a lockout which has or may have the
effect that:
any employee or class of employee is or may be unfairly
affected, or their employment opportunities, work
security or physical, economic, moral or social welfare
is or may be prejudiced or jeopardised thereby;
the business of any employer or class of employers is or
may be unfairly affected or disrupted thereby;
labour unrest is or may be created or promoted thereby;
the relationship between employer and employee is or may
be detrimentally affected thereby; or
(b) any other labour practice or any other change in any
labour practice which has or may have an effect which
is similar or related to any effect mentioned in paragraph
(a). (People and Profits, Dec 1981:18)
-39-
2.4.7 Status Quo Orders
Status quo orders are covered in Section 43 of the Act.
Sometimes the settlement of a dispute can be a lengthy process,
causing considerable difficulties to the parties. However, if a
dispute concerns the termination of, or suspension from,
employment of employees, a change in conditions of employment or
an alleged unfair practice, a party can apply to the industrial
court for a status quo order. If granted the status quo order
will compel the party concerned to restore the situation of
conditions which prevailed prior to the outbreak of the dispute.
2.5 QUALITY CIRCLES
Quality Circles have their roots in the concept of improved
motivation through employee participation in the decision-making
process. The Hawthorne experiments in the late 1920s and early
1930s and subsequent studies in America and Japan during the
1940s led to the realization that management should be concerned
with using the companies most important resource, its workforce,
and in so doing capturing the creative and innovative power that
lies within the workforce. (Aft, 1983:356).
-40--
Quality Circles defined by Dessler (Dessler, 1983:93) as a
"Group of 5 to 10 specially trained employees who meet for an
hour once a week for the purpose of spotting and solving
problems in their work area", were then introduced in Japan in
1962. Since its introduction in the West during the early 1970s
the progress of the Quality Circle movement has been relatively
slow. One of the major reasons for such sluggish , performance
has been lack of relevant information, disinterest by management
as a result of bias, preoccupation with cliche thinking as well
as poor management education (Bendix & Rocker, 1982:5).
Quality Circles is a special philosophy and organisations and
management must develop special management skills and attitudes,
before they can be implemented with success. The use of Quality
Circles has to grow out of management's long-term commitment to
increase quality and productivity, and managements realization
that his efforts will require tapping the creative'potential of
every employee. Quality Circles promote a people oriented
management style that respects the intelligence of employees
with the capacity to absorb training and motivation and to use
them constructively, a style that listens to employees
recommendations and recognizes achievements in a personal way
(Evans, 1986:10)
Quite clearly then a productive organisation results from a
participative, quality-focussed, and caring organisation.
Furthermore it is a merging of motivated, trained and involved
people, with the proper quantity and quality of materials,
efficient and effective methods, and the appropriate application
of advanced technology. Within the South African scenario, a
case of economic survival for many organisations, especially
with the pressure of sanctions and in other cases world-wide
competition it is time for our entrepreneurs and leaders to go
back to the drawing board.
-41--
2.5.1 Application In South Africa
Quality Circles arrived on the South African scene some five
years ago. The reception they received were somewhat mixed.
Some dismissed them by saying "That Japanese idea won't work
here because our people aren't sufficiently educated, trained,
sophisticated etc, etc ..." (Evans, 1986:9). That was a nice
and easy way out because it meant that they didn't have to do
anything. The organisation with a vision in South Africa
however, seized upon the concept, and through trial and error
application managed to improve quality and productivity even in
a deteriorating economic climate. This was possible through
ignoring common belief that Quality Circles are, secrets, a
magical new wisdom.
Alien and exotic, management interventions (Bocker and
Overgaard, 1983:17). Their method was through researching the
subject fully, and adapting the approach to their own particular
environment and circumstances, instead of plugging the overseas
mode "Voetstoots" into the system.
Clearly there are significant socio-cultural differences between
western and Japanese industrial lives and it is crucial for
South African managers to take cognizance of them.
-42- BASIC DIFFERENCES BETWEEN JAPANESE AND WESTERN EMPLOYEE
BACKGROUNDS AND RELATIONS WITH MANAGEMENT
JAPAN
WESTERN COUNTRIES
Homogeneous culture in a small country with almost no natural resources.
Deeply ingrained sense of hierarchy, place and obedience to authority.
Prevalence of an ethic of conservation resulting in creating much from little
Guaranteed lifetime employ-ment for most workers.
High work ethic, fast rising productivity.
Extensive pre and post em-ployment orientation pro-grams.
Emphasis is on quality .
B. Distinction between labour and management less impor-tant, because excessive "top-to-bottom" cross trai-ning, job exchanging and career development planning are the norm, closing the gap between management and labour.
9. Decision reached through consensus and participation.
10.QC programs are perceived as natural extensions of training and education.
11.Eagerly seeking workers suggestions.
12.Believing in capacity for responsibility of workers, who seek challenges and exercises self-direction and self-control.
Usually not so homogeneous in larger countries with more resources, particu-larly in the case of the US.
More individu'alistic atti-tude.
Attitudes and habits of wasting, illusions of "abundance".
No such guarantees.
Lower work ethic with sagging productivity.
Very little or no orien-tation.
Emphasis is on cost.
Great distinction between management and labour, little or no employee training and development, therefore managers are more likely to see them-selves as elite corps of decision makers.
Decisions made by relying on"orders from authority" mostly excluding indivi-dual creative thinking.
QC programs are a "new technique" viewed with scepticism and suspicion.
Restricting input of ideas from floor level.
Believing in lack of re-sponsibility, initiative and creativity or workers who "strongly need outer direction".
(BENDIX AND OVERGAARD, 1993:18) TABLE 4
-43--
All too often Western World Quality Circles have been
implemented in isolation. This is probably the major reason
that they have not, in general been as successful as those in
the Far Eastern Countries. Western managers undertake
pilgrimages to Japan in an effort to find out why they were
losing International market share, to their Eastern competitors.
Quality Circles were seen as the magic potion when in fact they
were only part of a total approach to productivity and quality
improvement. In Japan they refer to total quality control or
company wide quality control (CWQC) as opposed to simply Quality
Circles. As John Riddle, (Riddle, 1986:12) General manager of
steel operations at Iscor points out "While Quality Circles are
extremely valuable, they should never be seen as a magic wand
that can be waved to improve financial results on the bottom
line, or a magic tool which will instantly create a productive,
motivated work-force"
Another problem with implementing Quality Circles in South
Africa, as a panacea for all its work life, is that management
have tunnel vision with the concept. Eastman Kodak Chairman,
Fallon (quoted by Rocker and Overgaard, 1983:17) points this out
with the statement "You can't drive a good work force 30 %
harder, but we have found that we could often work 30 or 50 or
even 150 per cent smarter".
International expert Jeff Beardsley (quoted by Daniel, 1983:107)
points out four rules that must be adhered to when dealing with
Quality Circles.
Specific
Conditional
Measurable
Accountable
-44-
Starting Quality Circles means changing organisational be-
haviour and it is therefore crucial that organisations write
down as specifically as possible, and in a way that can be
communicated to others, what their objectives are for Quality
Circles.
Be as specific as you can about your conditions, expectations
and actions, all must be geared to promote commitment, moti-
vation, trust, openness, co-operation and communication.
Management must address the question: What are the limits ?
What is going to happen in this situation ?
The Quality Circles process has the potential of becoming one
of the most viable and effective management processes. But
if progress toward the specifics of rule 1. is not measured,
no one will know what changes are required.
Rules 1, 2, and 3 are pre-requisites for rule 4.
In other words the specificity demanded of rule 1. and the
parameters required of rule 2. will mean little without the
responsibility of rule 3. and the involvement of rule 4. Start
at the top or as high as you can get, teach them how to do it,
teach them how to get involved, teach them how to measure
themselves and to give feedback on how the process is working,
and teach them how to hold themselves accountable for managing
their people (Daniel, 1983:107-111)
-45-
2.6 WORKER PARTICIPATION IN YUGOSLAVIA
Yugoslavia's scheme for worker self-management is the most
comprehensive one operating to date. Unlike Soviet Russia,
Yugoslavia has attempted to introduce self-management based on
Marxist theory before the completion of economic development.
Since the 1950s enterprise level participation has formed the
basis of the entire socio-political system. They have regarded
it as imperative to begin the introduction of works
participation well before the completion of economic
development, in order to nurture the requisite skills and habits
of responsible decision making.
First introduced at the enterprise level in 1950 worker self
management and its associated procedures and structures have
gradually been built up as the foundation of the entire Yugoslav
socio-political system. Codified in the 1974 Federal
constitution and the November 1976 law on associated labour
(Miller, 1978:264)
The first step in operationalising the concept of worker
self-management was the promulgation of the Basic Law on the
Management of State Economic Enterprises in 1950. This laid the
main foundation for the present system administration in
Yugoslav factories. The principal organs established by the Act
were: the workers' council; the management board and the
enterprise director. In each workplace a workers' council,
elected by the entire work force, was to be given overall
responsibility for policy and the general economic activity of
the plant. The workers' council - consisting of between 15 and
120 members, depending on the size of the establishment - in
turn was to elect its own management board of 3 - 11 members to
carry out policy and settle a number of personnel and economic
-46-
matters. The Director was to be elected from the ranks of the
management board and he was to be responsible for the day-to-day
administration of policies which stemmed from the decisions of
the workers' council. However, the original configuration of
workers' self-management gave very little real power to the
workers' council. For example, it had no control over the
distribution of enterprise income. The management board has
some measure of authority, for example, in the selection of
second-level managerial and technical appointments, but the
Director remained the de facto boss of the enterprise with
virtually uninhibited power over working conditions and business
operations. Most importantly, he retained a veto over all
decisions of the other two bodies.
During the two decades which followed the introduction of the
original law many important formal changes were introduced -
some by government fear and the concept of worker
self-management underwent substantial elaboration in the
mid-70s. Very early in the 50s it was realised that as long as
a command-planning system was in force - with its detailed
specification of production, wage and, investment targets for the
indiviudal enterprise - there would be little scope for genuine
worker participation in decision-making. Two changes in
particular should be noted. Direct participation came to the
fore as a supplement to the representative system and greater
autonomy was granted to individual plants than was conceded by
initial legislation. Thus, in an attempt to promote workers'
involvement in decision-making, workers' councils were extended
to middle level management and in 1961 the so called "economic
units" were spawned in an effort to ensure greater freedom of
decision on the shop floor.
At the macro-economic level, economists and politicians alike
realised that worker self-management could have meaning only if
-47-
the workers in an enterprise were made responsible for decisions
which genuinely affected the fortunes of the enterprise and
their on personal livelihood. This would mean the abandonment
of tight central planning and State budgetary tutelage - in
short the establishment of some form of market relations in the
economy (Anglo American Corporation, Occasional Paper, 1984:3)
One of the fundamental goals of the Yugoslav self-management
systems, based on social ownership of the means of production,
is to abolish exploitation (in the capitalist sense) by giving
the workers control over the distribution of "surplus value"
they have created and by rewarding them according to the
value-creating work they have done. Workers are to have a say
in the disposition of investment capital created by their
respective enterprises. A problem regarding participation here
has been the tendency for capital to "leak away" and accumulate
in the banks and various state investment agencies either as
repayments for past loans and credits or as taxes and
assessments of enterprise income where it is disposed of by
"technocratic-managerial" forces beyond the influence of the
worker self-management system. As far as income distribution
policy is concerned there has been, on the one hand, a
substantial increase in the share of enterprise income left at
the disposal of self-management organs while, on the other hand,
there is increasing pressure on these organs to see that
decisions on the structure of distribution of enterprise
earnings are in line with the goals of higher authorities (Anglo
American Corporation, Occasional Paper, 1984:5)
-48-
2.é..1 The Role Of The Trade Unions
The need for trade unions in the Yugoslav system has been a
matter of some debate among Yugoslav officials and scholars ever
since the introduction of meaningful self-management. In a
system where workers or their delegates themselves make the main
decisions on employment policy, wage levels and working
conditions, it has sometimes been argued, the trade unions have
no role to play. In assessing this debate, one has to keep in
mind the chequered history of trade union activities in the
Soviet model which the Yugoslays had initially endeavoured to
follow. Soviet-type trade unions had characteristically
operated as an arm of the state bureaucracy with the primary
function of raising worker productivity and mobilising the
labour force for greater sacrifice. When strikes first began to
appear in Yugoslavia in the late 1950s, the trade unions were
usually found on the "bosses'" side of the barricades, but this
relationship has begun to change.
At the present stage of development of worker self-managment the
trade unions continue to perform the functions of an agent of
governmental policy. As noted, the trade unions' role is built
into the system at various strategic points; to recapitulate, in
the preselection of nominees for management organs and in the
nomination of candidates for workers' council and workers'
control organs, in the initiation and guidance of self-managment
agreements on wage rates and income distribution, in the
provision of backup support to workers' control organs in
locating and eliminating operational shortcommings
197B:166)
-49-
2.7 WORKER PARTICIPATION IN WEST GERMANY
The German labour relations system is known for its strong
worker influence, which pervades all levels of business in the
form of codetermination. The worker influence is precisely
defined and structured, affecting all levels of business, from
the Board of Directors to the assembly line workers. The word
codetermination itself indicates some sort of equality; a
balance between the worker representatives and management.
Employee rights guaranteed by German federal law provide a basis
for equal negotiation strength between worker representatives
and employers. Codetermination guarantees worker
representatives three various types of rights:
right to specific information
right of consultation
approval rights in specific matters
Which codetermination rights are applied under what conditions,
is defined by law. Some examples of the right to specific
information include profit and loss statements, investment
plans, head-count and personnel planning, product planning,
sales figures and planned office area remodeling.
The consultation right is more far reaching than the right to
specific information in that it allows worker representatives to
present suggestions and alternatives. These suggestions or
alternatives must be heard by management but they need not
necessarily be accepted. However, management must get approval
from worker representatives in some matters, such as hiring,
firing and the training of employees. These rights, which are
provided for the employee by virtue of the Works Constitution
Act, assure the employee a right to partly codetermine certain
aspects of the employment relationship. The framework in which
-50-
these various levels of interaction occur, and the interaction
itself, is clearly defined and resulted in German labour law.
2.7.1 Principles Of Codetermination
The adversary approach, which is the cornerstone of the American
labour-management system, is not the foundation block upon which
the codetermination system is built. The German system is a
multifaceted system without equal in the industrial relations
area. On the other hand, the Japanese have developed their
worker influence system within the day-to-day business
activities on all levels. This is referred to as quality
circles, where the employee is provided with an opportunity to
voice his opinion. The Japanese quality circle is not at all
similar to the German system, in which the workers' sphere of
influence is defined by codetermination. The Japanese structure
does not assume the worker is an equal, nor is it a system whose
historical basis is solidly anchored in federal legislation.
To be effective, top management in Germany must deal efficiently
with worker representatives at supervisory board meetings. The
most important function of a supervisory board is to audit the
board of directors. - The board of directors is required under
corporate law to regularly report (at least four times a year)
to the supervisory board as to the company's financial status
(e.g. profit-loss, sales, inventory, new products). The board
of directors is elected by the supervisory board. The
supervisory board is also responsible for an orderly change in
the board of directors' personnel.
When a company has more than DM 20 million in assets, then under
German corporate law the number of supervisory board members
shall be 21. One-third of these members are elected directly by
-51-
the employees. The remaining two-thirds are elected by the
general assembly. The general assembly is comprised of members
elected by the stockholders. Practically, its only function is
to elect supervisory board members. A smoothly operating board
of directors, together with a content supervisory board, has a
direct effect on the quality of the product and the efficiency
of manpower utilization. Work slow-downs, strikes, walkouts do
not exist in Germany. The stability of management and worker
representatives indirectly affects sales, stability in meeting
delivery dates, better quality and increased worker morale.
(Falk, 1902:198).
2.7.2 Union Influence
Although the German unions do not have direct control over the
works councils, they do exert influence over them.
Communication between the unions and the works councils is an
ongoing process. The unions set long-term goals: provide
information on what has been negotiated by other works councils:
provide some job-oriented training: and provide political, legal
and minor financial support.
In addition to works council members, union representatives are
chosen from among the employees to directly represent the
interests of the union within the factory. (In addition to any
other irregular activities which may arise.) In at least one
automobile company, the union representatives have attained a
verbal agreement with management for monthly meetings during
working hours, lasting approximately one hour. However, it must
be noted that the works councils are an autonomous entity, with
respect to the unions.
-52-
In order to attain results at the negotiating table, works
councils often utilize the powers provided under German law.
This power manifests itself in direct and indirect avenues which
are products of the officially promulgated law. The strongest
long-term influence that the works council possesses is over
matters concerning personnel (hiring, firing, transfer). All of
these activities must be approved by the works council. These
are considered collective rights of the works council, which
must be viewed together with those rights provided for the
individual employee under the Works Constitution Act (Falk,
1982:202)
Another powerful right which the works council has is the right
to obtain financial information from the companies, so the
general economic situation of the company can be determined.
The works council's foremost interest is in ascertaining the
economic effect on employees. The Works Constitution Act
mandates that an economic committee be formed comprising works
council appointees and management appointees. The employer must
inform this committee about its economic situation. The law
specifically assures that information about the following five
will be provided:
methods of manufacture and work
the product program
economic situation of the company
production and marketing situation
other circumstances materially affecting the
interests of the employees of the concern
-53-
This quite extensive list provides the works council with the
ability to attain insight into the economic status of the
company. Information that is so obtained must be kept strictly
confidential when the information can negatively affect the
capacity of the concern to compete with others. The company is
obligated to provide information only if this can be done
without risk to the trade secrets of the the company (Falk,
1982:203).
2.8 PRODUCTIVITY RELATED TO PARTICIPATIVE MANAGEMENT
Real productivity improvement in the South African context is
dependent on a variety of factors, many of which are applicable
across the board, others applying to a particular company or
organisation.
Goals should be expressed in realistic criteria followed
by feedback as regards general as well as specific matters.
Participation, at all levels, in terms of decision
making, is important.
Continued pressure, as to achieving organisational
objectives, must be exercised.
As far as these factors are concerned, two pre-requisites are
necessary.
The executive must be committed and dedicated to whatever
objectives have been identified.
Subordinates must have an extraordinary high level of
commitment to keep on responding in a manner that will
actually indicate progress in respect of productivity
improvement. (Van Den Bergh, Sept 1988:6).
-54-
In many organisations managers who are asked to improve their
performance respond with "What's wrong? Aren't we doing a good
job?" Generally, in such organisations, the call for
significant improvement is the signal of something amiss, a
crisis. In fact to make significant and lasting improvement in
productivity, an organisation must strive constantly,
perpetually, for excellence. In such a culture, performance
•improvement is not a fluctuating activity, turned on and off.
It is a central, continuing, and ubiquitous character of company
management.
Seven factors will make the difference between a successful
organisation and one that performs satisfactorily.
Communicate the expectation that constant
improvement is the overriding responsibility for each
manager. The foundation for constant improvement is a
managerial climate in which even- managers who have done
outstandingly well never feel "we have arrived".
Instead, the planning and execution of significant
improvements always occupy a significant share of time
and attention.
Develop the expectation that existing resources must
be fully exploited before seeking additional resources.
Since most managers are not getting the best of what is
available to them, there is plenty that can be done to
get greater returns. Before looking to "more",
managers need to ask: What can we do to get more from
the human and physical resources that we're already
paying for? How can we do a better job of managing
improvement?
-55-
3. Integrate improvement into the regular management
processes. To become long lasting, the management of
improvement must be built into the day-by-day,
week-by-week organisation mechanisms.
4. Integrate performance improvement and management
development. Instead of sending managers off for
training, hoping that they can apply their newfound
skills to getting something accomplished, the
performance improvement process itself can be designed
to develop management's most important skills and
abilities.
5. Create a high performance culture by:
Communicating your expectations for constant
improvement.
Emphasizing better exploitation of current
resources.
Focusing on a few key goals.
6. Provide management methods and disciplines to
sustain improvement by:
Maintaining continued leadership by top
management
Making appropriate help available to key, .
accountable department heads and managers.
Introducing new methods and technology
gradually.
7. Get started on short-term, low-risk, success
projects. (Bobbie & Schaffer, August 1982:25).
-56-
Productivity is often enhanced where people work smarter.
Ultimately, productivity improvement does not mean that fewer
people produce more. A more successful company will have more
work to do and is likely to employ more people. There are of
course, also other ways to make a company more successful.
One can obtain capital at more favourable rates.. One can buy
more efficient machines. One can increase production capacity
or improve the quality or quantity of the physical input
materials.
All these efforts, however, will only increase productivity
marginally, if one neglects labour productivity. One can
describe labour productivity in terms of efficiency and
effectiveness. When an employee is efficient, he/she is doing
things the right way, when an employee is effective he/she is
doing the right things.
Examples of doing things the right way, are carrying out tasks
correctly, doing more than the average or standard, rendering
outputs of a high quality or quantity and restricting wastage
and interruptions.
Doing the right things could refer to increased commitment to
company goals, the development of a positive attitude towards
oneself, the work group and the company, and contributing to
innovative change in the company.
While there is no doubt that companies often pay a great deal of
attention to the efficiency of individuals, their effectiveness
may receive less attention.
This may well be why productivity improvement programmes often
receive a negative response from employees: they see the
-57-
programmes as focussing only on their outputs (doing things
right) and not also on their participation in setting company
goals, in evaluating why goals are too easy/too difficult to
meet, in measuring individual and group work satisfaction and in
creatively improving work processes (doing the right things).
The key factors in dealing with these dimensions of labour
productivity are supervisory and managerial emphasis and
leadership style.
Mature supervisors and managers are willing to share
decision-making with subordinates, because they believe that
employees on the lower levels of the company's status-authority
hierarchy, can contribute to the success of the company.
Less mature line management only strives to have technically
competent and efficient subordinates. We should 'have a closer
look at managerial emphasis and leade'rship style and how they
contribute to organisational climate (Van Wyk, September
1988:18).
In South Africa what ought to be our greatest asset - our
multi-coloured multi-cultured tapestry of people is deemed to be
our greatest problem, our greatest liability.
The differences between us are not seen as advantages but as
reasons to create political boundaries and fences between us.
The similarities are used to create groups with boundaries
around us and power structures to protect these "laagers". Far,
far too many people are living what Thoreau describes as lives
of "quiet desperation". What on earth are we doing wrong and
what is it that the four finalists in the competition have done
right?
-58-
There is a major issue which is worth discussing, that of a
self-created leadership crisis.
In any society or natural group of people about 15 per cent are
achievers and the other 85 per cent conformers. The achiever
wants to lead, perform, excel, make money, do things differently
and make his on individual mark upon the world. He thrives in
a merit society, a free enterprise society and dreams of what
the world or his society will be like when it reaches the
destination he has planned for it. He is a natural leader.
The conformer is a natural follower. He values consistency,
conformity, justice and fairness, seeks security and safety and
happily settles for second place. He is essentially socialistic
and favours a status society.
The tragedy of South Africa is that whites have assumed that the
15/85 per cent rule of thumb applies but on the basis that all
the whites are achievers and all the blacks are conformers or
sheep.
The cost of this awful error has been disastrous.
On the other hand we have amongst the whites a cadre of
outstanding achievers and leaders, which explains why South
Africa, until recently at least, had an international standing
in many fields of human endeavour far more impressive than a
small young country would normally expect to have.
But the other 85 per cent of the whites who have been thrust
into the achiever role are over-promoted, have no followers
amongst the blacks they are expected to lead and are under very
serious threat and therefore stress.
-59-
Hence the high rates of social insecurity and all the
consequences thereof. For the non-whites the impact is equally
serious particularly for the 15 per cent who are natural
leaders. Denied easy access to the institutions which they
would normally dominate - legitimate politics, business, the
church, the universities, they have no alternative but to seek
power and opportunity where they can find it -_Jegitimate or
not. And their's is surely a life of deep frustration and anger
(Hall, 1986:5-6).
f'l CD ID CD CD CE3
3.1 SAMPLE SELECTION
To elicit a high response rate across the range of managers
within Makro, the questionnaire was administered to half (52) of
the managers within the group.
The population consisted of 104 managers. Each person's chance
of being selected was 1/104. After selecting the person, that
person was not returned to the population, so that the chance of
the remaining population was 1/103. This procedure is known as
sampling without replacement.
3.2 METHOD
Random numbers were assigned to the population and any person
who was randomly assigned the number 10 was drawn.
3.3 SAMPLE SIZE
The sample was as large as possible in order to give the
principle of randomness a chance to work. A small sample would
possibly have resulted in a deviant sample. From a research
point of view the sample must have approximately the same
characteristics of the population relevant to the research.
3.4. QUESTIONNAIRE DESIGN
The questionnaire which is presented in appendix 1 was handed
out with a covering letter, presented in appendix 2. This
letter stressed the importance of responding, in that the study
will be more valid and reliable as a result of more responses.
-6i--
The questions in view of the research objectives were divided
into nine sections.
....,,_ 1. Respondent details - questions related to the personal
characteristics of the respondent. (questions
1,2,3,4,5,6,7,8)
Perceptions as to the definition, and acceptable forms of
participative management. (question 9)
Perception of how profit is related to participative
management practice. (questions 16,18)
:-- 4. Perception of how power is related to participative
management practice. (questions 21,24)
Views of attitudes to participative management practice
within Makro. (questions 10,11,12,14,15)
View of the Trade Union, and Shop Steward's Body as
participants in participative management practice.
(questions 13,22)
Views on the effect of participative management on worker
motivation. (question 17)
e. Perception of the rights of employees related to
participative management practice. (questions 19,23)
9. Understanding of training related to participative
management practice. (question 20)
More than one question was asked in six of the none sections to
check for consistancy in responses to specific issues.
-62-
3.5 LIMITATIONS
1. There was no interviewer present to observe the
respondents' non-verbal behaviour or spontaneous responses.
2. There was no control over the order in which respondents
may have answered the questions.
3. There was little control over the environment in which
the questions were completed.
4. Of the 52 questionnaires that were administered only
were returned completed. This represents a response of 737.
38
be
is
MANAGEMENT GROUP ADMINISTERED RETURNED PERCENTAGE
TOP MANAGEMENT 16 12 75%
MIDDLE MANAGEMENT 18 13 73%
SUPERVISORY MANAGEMENT 18 13 73'/.
5. When we draw a random sample we hope that it will
representative, that all the relevant characteristics of the
population will be present in the sample in approximately
the same way they are present in the population. There
never a guarantee of this by way of a random sample.
-63-
3.6 TESTING OF THE QUESTIONNAIRE
The questionnaire was tested on a group of ten people, from
differing levels in the company, prior to it being administered
to the sample. This was to ensure that it was understood, and
complete, in terms of gathering data that was relevant to the
objectives of the study.
-64-
CI-APMR F- DUR — Mf=tKRCI) SIDUTH
4.1 HISTORY OF MAKRO IN SOUTH AFRICA
Makro International, based in Holland, began trading in 1968,
and the concept was so successful that the company looked abroad
for expansion opportunities. At the same time Rennies Holdings
were operating a wholesale business, J•W. Jagger & Co. It was
decided that Jaggers should be phased out and replaced by Makro.
In 1971, the Germiston store was opened, being the first Makro
store in South Africa. Today, Makro has six stores operating
around the country.
In 1987 Makro International sold their 2/3 shares for Makro
South Africa to the Wooltru Group, the remaining 1/3 share was
still held by Rennies. Wooltru bought this in 1988.
The wholesale and retail distribution trade is economically
concentrated and largely dominated by powerful business
corporations which are well established in the market.
Makro S.A. carries a vast range of food, liquor and non-food
items. The product range is extensive and it takes in
everything from tinned baked beans to electrical appliances,
fine wines and this season's fashions.
Makro offers small businesses a unique wholesale service. Makro
clients are mainly small store owners, from corner cafes, to
suburban supermarkets.
Makro's customer base is restricted to eligible businesses,
institutions, organisations and associations. This has always
ensured a degree of exclusivity for Makro customers.
-65-
4.2 HUMAN RESOURCES PRACTICE AT MAKRO
Makro has always, by virtue of its International Origins,
coupled by Management insight, been a progressive company, in
terms of Human resource management practice. The company has
always been an equal opportunity employer and dedicated to the
development of people.
All Makro employees enjoy a range of benefits including:
A Pension fund
Makro medical aid
C Staff purchasing policy
Group life assurance scheme
Housing scheme
F Maternity leave (up to six months)
Study loans
Educational Bursaries
I Privilege day off (one a month)
(Obviously all statutory benefits are included.)
More importantly however, are the benefits related to the growth
of people. Makro is committed to ensuring the continual
upliftment and improvement of staff in a suitable and healthy
environment. All employees are exposed to a career path, with
performance appraisals done twice a year. This process ensures
that the company permits its on people to grow enabling them to
take up the more senior positions in the company as they arise.
Makro also put a great deal of emphasis on the right of
employees to be managed competently, and to this end Makro
ensures that all managers are competent in people management
skills. For those who require training in this regard, Makro
provides a number of management courses.
-66-
4.3 UNION INVOLVEMENT DESIRED BY MAKRO
Makro have always recognised the rights of employees and to this
end have abided by a recognition agreement with the
representative Union CCAWUSA (COMMERCIAL CATERING AND ALLIED
WORKERS UNION OF SOUTH AFRICA) since 1983. Labour Relations
Practice within the company is regarded as critical to the
performance of the business and for this reason Makro place a
great deal of emphasis on Industrial Relations training, and
practice.
All stores have an operative shop stewards body which meet with
management at least once a month, to discuss any issues of
importance.
-67-
C=2 E-4 F: F> -T- EE: F=2 F=7 I <1 FEE F: INJ L__ Y' EE3 DF7 -T- F-1 EEE
NI ID
OF- FR ARCI--1
5.1 SECTION 1 - RESPONDENT DETAILS
Questions one to eight are all related to biographical details
of respondents in terms of:
A Home language
Sex
C Age
Race
level of education
F Length of service with Makro
Position in the Company
Figures one to twenty are percentage representations of this
data. The data is compared within the management groups and
then as a total sample.
Question What is your home language? Refer to figures 1 -
4.
Question Your sex? Refer to figures 5 and 6. Interesting
to note here that only 5.37. of the total
respondents are female, which were
in the Supervisory group.
representative
Question Your age? Refer to figures 7 - 10.
-68-
Question 4: What is your citizenship? All responses to this
were "SOUTH AFRICAN"
Question 5: What is your race? Refer to figures 11 - 12. In
both the top management and middle management
groups there were only whites. In the supervisory
management
Black and
group (Figure 11) there were Coloured
Asian respondents present.
Question What is
achieved?
the highest level of education you have
Refer to figures 13 - 16.
Question Length of service with Makro? Refer to figures 17
20.
Question What is
question
respondent
your current position with Makro? This
was asked to establish in which group the
was for purposes of the analysis.
Makro's
groups for
Management structure falls into three
the purposes of this study:
Group 1: Top Management Categories A - E
Group 2: Middle Management Categories F - J
Group 3: Supervisory Management Categories K - L
Level "A" represents the Managing Director and other Directors
and level "L" represents a department manager (the first level
of management within Makro)
-69-
Consideration of the biographical information related to the
entire group of respondents has brought interesting information
to the fore.
Over half of the respondents are english speaking.
It would have been expected that a great deal of
management staff would have been afrikaans (Dutch) due
to the fact that the Company was originally started by
the Dutch.
The management group is relatively young. 47% of
respondents are between the age of 26 - 35. This is
a reflection of the management scenario within South
Africa, in that it has become increasingly difficult to
find "good managers" which has pushed down the average
ages of managers who are in relatively senoir
positions.
Only 5.37. of the sample are Female, and this in the
supervisory group only. Although many woman have come
back into the job market, in general, due to the ailing
economy, this has not yet manifested itself at Makro.
ENGLISH 66.6
AFRIKAANS 33.3
ENGLISH 84.6
AFRIKAANS 15.4
Pig. 2
-70-
HOME LANGUAGE TOP MANAGEMENT
IN PERCENTAGES
HOME LANGUAGE MIDDLE MANAGEMENT
IN PERCENTAGES
ENGLISH 68,5
it* HINDI 2.6
N. SOTHO 2.6
S. SOTHO 2.6
-7 1-
HOME LANGUAGE SUPERVISORY MANAGEMENT
ENGLISH 53.8
S. SOTHO 7.7
F 1L
IN PERCENTAGES
HOME LANGUAGE TOTAL SAMPLE
AFRIKAANS 23.7
IN PERCENTAGES
-72--
SEXUAL CO\APOSITION SUPERVISORY MANAGEMENT
Fig.
IN PERCENTAGES
SEXUAL COMPOSITION TOTAL SAMPLE
MALE 94.7
FEMALE 5.3
IN PERCENTAGES
-73-
AGE GROUPS TOP MANAGEMENT
T, I , 1g. (
IN PERCENTAGES
_ AGE GROUPS MIDDLE MANAGEMENT
8
IN PERCENTAGES
26 - 35 47.3
Fig. 1_0
16 - 25 2.6
56 - 65 2.6
- 7 4 -
AGE GROUPS SUPERVISORY IVANAGEMENT
16 - 25 7.7
56 - 65 7.7
46 - 55 23
Fig. 9
IN PERCENTAGES
AGE GROUPS TOTAL SAMPLE
IN PERCENTAGES
COLOURED 23.1
Fig, 11
WHITE 76.3
ASIAN 7.9
COLOURED 7.9
BLACK 7.9
Fig. 12
-75-
RACE SUPERVISORY MANAGEMENT
IN PERCENTAGES
RACE TOTAL SAMPLE
IN PERCENTAGES
PATRIC 38.4
DEGREE 7.7
DIPLOMA 53.9
Fig. 14
-76--
HIGHEST EDUCATIONAL LEVEL TOP MANAGEMENT
DIPLOMA 8.4
Fig. 13
IN PERCENTAGES
HIGHEST EDUCATIONAL LEVEL MIDDLE MANAGEMENT
IN PERCENTAGES
-77-
HIGHEST EDUCATIONAL LEVEL SUPERVISORY MANAGEMENT
Fig. 15
H4 PERCENTAGES
HIGHEST EDUCATIONAL LEVEL TOTAL SAMPLE
MATRIC 52.7
STD. 8 10.5
DIPLOMA 26.4 DECREE 10.7
Fig. 16
IN PERCENTAGES
ONE YEAR 16.7
TEN YEARS 8.3
FIVE YEARS 8.3
LESS THAN ONE YEAR 25
FIFTEEN YEARS 8.3
LESS THAN ONE YEAR 15.4
FIFTEEN YEARS 7.7
ONE YEAR 15.4
TEN YEARS 23
FIVE YEARS 38.5
-78-
LENGTH OF SERVICE TOP MANAGEMENT
THREE YEARS 33,3
Fig,
IN PERCENTAGES
LENGTH OF SERVICE MIDDLE MANAGEMENT
Fig. IS
IN PERCENTAGES
TEN YEARS 23.1
THREE YEARS 23.1
LESS THAN ONE YEAR 23
FIFTEEN YEARS 7.7
FIFTEEN YEARS 7.9
TEN YEARS 18.4
THREE YEARS 18.4
LESS THAN ONE YEAR 21
-7 9-
LENGTH OF SERVICE SUPERVISORY MANAGEMENT
FIVE YEARS 15.4
Fig. 19
IN PERCENTAGES
LENGTH OF SERVICE TOTAL SAMPLE
FIVE YEARS 21
20
IN PERCENTAGES
-80-
5.2 SECTION 2 - PERCEPTIONS AS TO THE DEFINITION OF
PARTICIPATIVE MANAGEMENT
Question 9: How do you understand the term "participative
management? This question elicited responses on
options 1, 2 and 3 only (indicated below), from
all respondents. Refer to figure 21
Choices
Managers participate with other managers and
make decisions concerning the company, at all
levels of the company.
Managers and employees participate to make
decisions, concerning the company, at all levels
of the company.
Managers and employees participate to make
decisions, concerning the company, at some levels
of the company.
From figures 21 it can-be seen:
The majority of Top management perceive
participative management as described in option one.
(59%)
The majority of Middle management perceive
participative management as described in option two.
(63%)
The majority of Supervisory management perceive
participative management as described in option three.
(63%)
-81-
Quite clearly there is a distinct difference in perception of
"participative management", in its broadest sense, between the
three levels of management at Makro. This differance in
perception, especially in the broadest sense, of participative
management, will inhibit any attempt of implementing a
participative management system or style without training.
A comment from one respondent in each group will support this
finding.
Top management: "lower levels should not be
involved in decisions which are those of
management, simply for the sake of involvement.
This can divert them and waste time." "All
managers and employees are involved and make a
contribution to those decisions, which: A)
affect their work lives, 13) over which they can
make an influence based on their specific
expertise or experience"
Middle management: "Participation is the major
route to gaining commitment from others. If doing
the job depends on others, then participation
becomes the way. It could also very well lead to
the job being done in the best way: having being
determined by the coalface"
Supervisory management: "I think managers and
other managers must make all decisions and also
get .a feeling from the employees side of view"
-83--
5.3 SECTION 3 - PERCEPTION OF HOW PROFIT IS RELATED TO
PARTICIPATIVE MANAGEMENT PRACTICE
Question 16: Profit is far more important than people. Refer
to figure 22.
From the graph it can be seen that top management
have in 597. of the cases responded by saying "do
not know". It is important to mention here that
in 427. of those cases respondents indicated on
the questionnaire that profit and people are
interdependent.
Middle management, by 937., disagree with the
statement without any comment.
Supervisory management responded by 317., that
profit is more important than people. This
response is interesting from this group, and can
only be understood in terms of profit satisfying a
security need, in the form of salaries.
Question 18: How do you understand the term participative
management in terms of company profits? Refer to
figure 23.
The question elicited responses to options 1, 2 and 5.
All profits shared equally at all levels.
Profits shared proportionately depending on your
level.
5. Profits shared by shareholders only.
-84-
The response to this question was overwhelming -
907. (from respondents in all three groups) to
option two - "Profits shared proportionately
depending on your level". This response is in
line with the companies policy on incentive
bonuses. These are dependant on year end profits,
and paid proportionately, from level A to level K.
In terms of profit related to participative management practice
there is a difference in perception of the importance of profit
related to people. This is evident in the supervisory group
where 317. perceive profit to be more important than people.
Although profit is not mentioned frequently in the literature,
as the one of the primary aspects related to participative
management, it is critical in any consideration of participative
management, especially in South Africa, where wages have become
an important aspect in an inflationary environment.
It was interesting to note that managers in the supervisory
management group responded, by 317. that profit is more important
than people. This response can be interpreted as this level
appreciating the importance of profit, in that profit meaens
beter saleries, and beter increases. The higher one goes in the
management structure the less important salery becomes, and the
more important recoginition and responsibnility becomes.
Should participative management be introduced it would be
necessary to address profit in terms of what it would mean to
the manager, and to the employee. This would require carefull
thought.
-85-
AGREE FULLY DO NOT KNOW DO NOT AGREE
TOP MANAGEMENT MEI MIDDLE MANAGEMENT
L1 SUPERVISORY MANAGEMT
Fig. 22
OPTION 1 OPTION 2 OPTION 3
SUPERVISORY MANAGEMT
TOP MANAGEMENT Mi MIDDLE MANAGEMENT
- 8 6 -
Fig. 23
FIT
120
93 92 100
80
60
40
20
IN PERCENTAGES
-87-
5.4 SECTION 4 - PERCEPTION OF HOW POWER IS RELATED TO
PARTICIPATIVE MANAGEMENT
Question 21: Participative management at Makro will mean that
management will no longer have power, giving the
employees all the power, and the company will
suffer financially Refer to figure 24.
From figure 24 it is evident that the entire sample responded
"do not agree at all" to this statement.
The overall perception of power is quite clearly understood as
the power to make decisions in this question, as can be
appreciated from some statements that were made by respondents.
A) Top management: 1. "Management must still have
the final say, set the pace and give direction".
2. "Participation does not
mean abdication, but rather an opportunity to be
involved in the decision making process".
3. "Participation runs on a
continuim from total democracy in its purest sense
to some form of tokenism at its worst. My feeling
is that Makro should position itself closer to the
former, with management deciding on the objectives
and employees deciding on how to get there.
8) Middle management: 1. "Management will
ultimately still hold the power, but you will gain
motivation and commitment through the sharing of
ideas.
2. "By managers involving
employees in decision making does not mean that
managers relinquish power or authority. On the
contrary managers become more aware of problems,
ideas etc", and are in a better position to handle
this timeously".
3. "Participative
management is not a question of power, but rather
a management style".
C) Supervisory management: 1. "Managers will
always be there to guide employees and set goals
and objectives to make more profit".
"Participative
management does not mean that the employees will
have the power to decide where the company is
going. Management and employees will participate
in making our business a success".
"Major decisions
will always be the right of management and these
carry the power".
Question 24: Does participative management in operation mean
that the political rights of employees become more
important than the daily running of the business?
Refer to figure 25.
From figure 25 it is appreciated that 97% of all respondents
responded "not at all". Only 87. of respondents in the
supervisory management group responded "do not know".
Quite clearly respondents feel that the political rights of
employees is not of any importance at the work place as can be
appreciated from comments below.
Top management: 1. "Participative
management is about management style. Trade
unions in South Africa is about political,
social and economic issues".
-89-
"This is a business
not a political party".
"Participative
management has nothing to do, in my opinion, with
political rights. Participative management is
within the workforce, and political rights stay
outside".
8: Middle management: 1. "We are in business
to make a profit for our shareholders".
"Political rights
do not play a role in business".
"If employees are
given the opportunity to participate in the
process, it will reduce the need to politicize the
workplace as a means of protest".
C: Supervisory management: 1. "The daily running
of the business is the most important aspect.
Without successful operations there is no
profit and no benefit to employees:.
If politics were
to run our business, a lot of people would be
without a job soon".
"Politics and
business do not mix".
In terms of power, it is quite clear that all groups think
alike. This response was unexpected especially in an
organisational environment that is so volatile in terms of
Industrial Relations.
Should power have been pecreived differently amongst the groups,
it would be very difficult to introduce a participative
management style because power sharing is a prime ingreadient
for it to be a success.
LU
AG
RE
E S
TR
ON
GLY
TO
P M
AN
AG
EM
EN
T
DO
NO
T A
GR
EE
IN P
ER
CEN
TAG
ES
SUPE
RV
ISO
RY
MA
NA
GE
MT
T II
0 0 0 0 0 0 0 CV 0 CO CD 04,5
1'
-92-
5.5 SECTION 5 - VIEWS AND ATTITUDES OF PARTICIPATIVE
MANAGEMENT PRACTICE WITHIN MAKRO
Question 11: Top management are committed to the principle of
participative management (the principle as you
understand it). Refer to figure 26.
From figures 26 it can be seen that there is a difference in
views between the levels of management.
A) Top management believe that there is total
commitment (50% - strongly agree and 507. - agree.
No respondents indicated "disagree"). If one
relates this to their response to question 9,
(58.37. responded that participative management
means: Managers participate with other managers to
make decisions) it can be understood that all
respondents feel that management are committed to
the principle of participative management.
8) Middle management felt that top management are
not committed to the principle of participative
management, by 327.
C) Supervisory management felt, by 16%, that top
management is not committed to the principle of
participative management.
-93--
Question 12: Does top management have to be committed to the
principle of participative management for it to be
a success? Refer to figure 27.
All respondents in the whole sample, excepting two (5.27.) from
the supervisory management group responded "Strongly agree" to
this question, as can be appreciated from figures 37 and 38.
Those two (5.27.) responded with "Agree".
It is clear that there is understanding that for a participative
management style to be effective it requires commitment from top
management.
Question 14 The dominant management style in Makro provides a
favorable environment for participative management
practice. Refer to figure 28.
A) Top management responded, by 917. (507. strongly
agree and 417. agree) that they agreed with this
statement. There were no respondents who felt
that they disagree with this statement.
13) In the middle management group 377. responded
strongly Agree and agree, however a further 567
responded strongly disagree and disagree.
c) In the supervisory management group 46%
responded strongly agree and agree and 317.
strongly disagree and disagree.
-94-
Comments from various respondents will elucidate this finding.
A) Top management 1: "There is an
understanding within management of the importance
of people and their ability to influence the
success or failure of the business".
"We have the right
culture and climate to make it successful".
"Management have
an open door with the M.D. and I believe employees
have an open door with their respective managers".
B) Middle management 1: "The worker's see
management as an elevated bunch of snobs with a
"closed open door policy who like telling a lot
and are low on feedback".
"The management
style is "dominant" and it prevents the idea or
philosophy of encouraging participation".
"There is no
consistency of management styles between the
different stores".
C) Supervisory management 1: "Management and
staff do work together at Makro".
"Suggestions from
staff on the floor are always viewed by management
and sometimes implemented".
"Top management
are willing to understand the problems that staff
have".
-95-
Question 15 If there were to be a participative management
programme at Makro would you be committed to it,
and why would you be? Refer to figure 29.
All respondents in the whole sample except for one (2.6%) in the
top management group, responded "yes" to this question. Quite
clearly therefore, there would be commitment to an operative
participative management programme.
Some comments will support this finding.
A) Top management 1: "Because it
works!".
"Simply because I
believe results are achieved by people, through
people".
"Participation on
a broad basis raises expectations and involves
people who are not qualified or experienced to
have a valid opinion". (this respondent answered
no to the statement).
-9 's-
B) Middle management 1: "It is in the
interest of the company's future".
"By encouraging
and involving all levels of employees you get a
committed workforce".
"Participation
will bring profit and working harmony".
C) Supervisory management 1: "Participation
allows for growth and that is what keeps people
motivated".
2: "It will make
everyone feel a part of the company and people
will feel secure in their jobs".
3. "I will part and
parcel of it because as a manager I can't do the
work without involving my subordinates".
Question 10 How many subordinates report directly to you?
This question was asked to establish whether or not the
respondents are managers, by virtue of having people reporting
to them. All respondents do have people reporting to them. The
least a manager has reporting to him is 1, and the most is 14.
The average is 6.5 for the whole sample.
Clearly there is an understanding throughout the group, that
commitment is a pre-requisite for any participative management
system or style, to be a success, and especially from top
management. There were however different perceptions between
the groups as to the level of commitment, to patricipative
management from managers at Makro. Clearly all managers, at all
levels would, not only gave to be commited, but also be aware of
each others commitment for a participative management style to
be a success.
-4
0
r-
930V
INA
01:1
3d N
I
IN
3IA
I3O
VN
VIN
c10
1
IIPO
OV
NIIN
AEI
OSI
AH
3c11
19
-4 53
r-
33
1:10\/ i
NtO
CI
IN31
A13
0V
NY
V1 3
100
11AI
BR
EJO
YS
IG "S
N.) O 0) 0 0 0 0 0 0
01 0
AA\ \
t7f4Frs:0057:1-s, \ \ At% N
\ \ \
-97-
Fig. a
NECESS
AGREE STRONGLY AGREE
120
100 100 100
80
60
40
20
0
15
-98-
TOP MANAGEMENT Mi MIDDLE MANAGEMENT
SUPERVISORY MANAGEMT
IN PERCENTAGES
Fig. 27
930V
IN3
0113
c1 N
I
0
IN
3V+4
30V
liN
RD
YN
VIN
AEI
OS
IM:1
3d11
8
..L.
PO•N. 0) co 0 to 0 0 0 0 0 0 0
co &XXI
IN
MAI
3OV
NV
IAI 3
10
(111A
1
co
-100-
Fig. 29
-101-
5.é SECTION 6 - VIEW OF THE TRADE UNION, AND SHOP STEWARDS
BODY AS PARTICIPANTS IN PARTICIPATIVE MANAGEMENT
PRACTICE
Question 13: Who do you believe should be entitled to have
participation in the company? Refer to figure 30.
Top management feel that the shop stewards body
should be entitled to participation to the tune of
67% (337. shop stewards and managers and 347. shop
stewards and employees).
79 Percent of middle managers answered this
question with "Do not know". Important to note is
that 627. of these respondents indicated "all
employees and management should be entitled to
participation", on their questionnaires.
76 percent of supervisory managers feel that shop
stewards should be entitled to participation in
the company (537,. shop stewards and managers and
237. shop stewards and employees)
Question 22: Participative management means that the union,
(through the shop stewards committee) together
'with management make decisions related to the
company. Refer to figure 31.
From the figure 31 it can be seen that 587. of top
management agreed with this statement.
-102-
£1 percent of middle managers responded "did not
know". All these respondents whom responded "do
not know indicated all employees should be
entitled to participation" on their
questionnaire.
69 percent of supervisory managers agreed with
this statement.
Of importance in this section is that the shop stewards body is
perceived as an important decision making body by the top
management group, and even more so by the supervisory management
group. The middle management group do not perceive this to be
the case, but rather point out the importance of participation
for all.
There is obviously confusion between the management groups as to
the role of the shop stewards body in the participative
management system. Organised labour is viewed as an important
aspect of Makro's management ethos, and therefore it is critical
that there is common understanding and perception of the role of
organised labour (through the shop stewards body) in a
participative management system or style.
To achieve this common perception, Makro would not only have to
undertake Industrial Relations training, to enlighten managers
and employees of Industrial Relations practice, but there would
also have to be further training, as to the role that labour
plays in a participative management system or style.
(13 11\2
1,4
39V
M1 3
100
1Vil
Co
... a
a 0 a 0 0 0
Co
93
0V
1N3
01:0
1d N
I
77 N
O -1
2ON
N
11\2
1'4
30, V
MM
d0
1
Co Co
11A
130V
NV
IN A
HO
SIA
EI3
d118
ENSEEZES
-103-
Fig. 30
ika 01 CI) \I CO 0 0 0 0 0 0 0 0 0
SRO
VI.
N39
Ela
d N
I
IMO
VN
VIA
AH
OSI
ALI
3d1 1
8
INT
AI3
OV
NV
IN 3
1C1
01141
IN
TA
RO
VN
VIN
d01
Jaw
IMMEMECIM ,I;41034,,
z
33
EIO
VS
IO X
1313
1d61
00
-104-
Fig. 51
-105-
5.7 SECTION 7 - VIEWS ON THE EFFECT OF PARTICIPATIVE
MANAGEMENT ON WORKER MOTIVATION
Question 17: Participation will allow for an environment in
which employees will be more motivated to do their
work. Refer to figure 32.
All respondents to this question responded "fully agree", as can
be depicted from figure 32.
Common understandimg and perception of the effect of
partivipative management practice on motivation is engouraging
to see. Clearly a participative style or system would only
enhance motivation because accountability and responsibility are
shared by all, to differing degrees, which. are "real"
motivators.
-107-
5.8 SECTION 8 - PERCEPTION OF THE RIGHTS OF EMPLOYEES
RELATED TO PARTICIPATIVE MANAGEMENT PRACTICE
Question 19: Do employees have a right to decide on the
companies objectives? Refer to figure 33.
Top management agree with 847., and disagree with
16%
Middle management agree with 937. and disagree with
17%
Supervisory management agree with 307. and disagree
with 70%
Question 23: If Makro were to adopt a participative management
style would you feel threatened that you would
lose your job with the company? Refer to figure
34.
All top management respondents responded "no". No
respondents said "yes".
82 percent of middle management responded "no".
No respondents said "yes". 18 percent responded
indifferent.
77 percent of supervisory management responded
"no". No respondents said "yes". 23 percent
responded indifferent.
S3O
VIN
39
1:13d
NI
1N31
/43e
NIN
VN
d0
1
iVaD
VN
VIA
I AEI
OSI
AE
9d
118
IN3N
3OV
NV
IAI 3
1001
1/1
CO
MP
LE
TELY
AG
RE
E M
NG
T &
EM
PL
TO
GE
TH
ER
.1%W\M1
AN
Vdi
Ali
0
12132=31
REIMS=
-108-
1\3 CO CO 0 0 0 0 0 0 0
Fig. 53
oo coo
930
V-IN
30
1:13d
NI
1N31
6139
VN
VIA
I daL
IVI3
VIN
VV
\I A
HO
SIA
En
drI
S
1N3
IAIR
OV
NV
VI 3
100 W
I
v
Catas
\Mtil
- 109 -
Fig. 34
-110-
Comments from some respondents will elucidate this finding.
A) top management: 1. "I believe in
results and good ones will not result in my losing
my job".
"Participative
management should be seen as an opportunity and
not as a threat".
"As long as I do
my job I am not threatened".
B) Middle management: 1. "My aim is to get
the job done to the best of my ability and this
will never be threatening to me".
"If you push
accountability and autonomy down performanc
increases without threat".
"Participative
management is not a question of power but rather a
management style".
C) Supervisory management: 1. "If accountability
is shared by a whole work group I would feel less
threatened than I do now".
"participation
creates mutual trust and not threats".
"Participative
management should not be biased in any way so that
an employee who is qualified to do his job feels
threatened".
Again there is differing perceptions on the issue of the righrs
of employees, in terms of participating in deciding on company
objectives. It would be necessary to adress this issue proir to
implementing any participative management style, because there
would have to be understanding of what levels, in the compamy,
would become involved in objective setting.
5.9 SECTION 9 - UNDERSTANDING OF TRAINING RELATED TO
PARTICIPATIVE MANAGEMENT PRACTICE
Question 20: Do you believe that you need to be trained in
order to perform in a participative management
environment? Refer to figure 35.
58 Percent of top management believe they need
training to perform in a participative management
environment whilst 42 percent do not.
38 Percent of middle management believe they
require training to preform in a participative
management environment whilst 62% do not.
23 Percent of supervisory management believe they
require training to perform in a participative
management environment whilst 77 percent do not.
In terms of the idea that training is necessary prior to
managers performing well in a participative management
environmant there are widely differing perceptions.
Clearly there is little understanding of what participative
management really is, between levels of management. Furthermore
it goes without saying that managers and employees would have to
be trained to perform efficiently and effectively within a
participative management environment, because it means that
accountability and responsibility are passed down to the lower
levels within the organisation.
Kt%
S3O
VIN
29
1:13
d N
I
.1.11
31A
IBO
VN
VIAI
dO
i ..1
N3
INB
OV
NV
IAI 3
10
G
0
0
z
MO
N:4
ION
00
0 0 0
-112-
-113-
G 1-11F) F2 I X G L_LJ I D NJ
6.1 CONCLUDING REMARKS ON THE RESEARCH
From this research project it has become clear that there are
numerous differences in perceptions of participative management
between management levels at Makro South Africa. The primary
emphasis of this report has been to examine the nature, and
pattern of perceptions of participative management. Since it is
difficult to define participative management in a finite
definition it is difficult to draw finite conclusions. It is
possible however to make observations from the empirical data
that was collected and collated.
These findings follow the format in which the questionnaire was
analysed.
Section 1 In terms of the biographical data the
interesting findings were:
The small amount of females within the
management_ structure (only in the supervisory
,group).
The relatively young nature of the management
sample (47.37. of the entire sample is between the
age of 26 - 35).
Section 2 The response to the definition of
participative management was different in all three
groups.
1. Although the question related to the perception
of participative management, in this case was in
general terms, the responses were significantly
different between the management groups.
-114-
Top management quite clearly perceive
participative management to be a management style
shared between management only. Furthermore,
participation in decision making decreases as one
goes lower down the management hierarchy.
Participation by employees is seen to be
time-consuming and an interference in the
direction of the company. Management are seen as
the decision makers in determining the company's
goals and objectives whilst employees are involved
in decisions that affect their work lives.
Middle management perceive participative
management to be a style that permits all
employees to be involved in decision making.
The supervisory group perceive participative
management as a style that allows for
participation by employees in "some" decisions.
Section 3 In terms of the link between profit and
participative - management it is quite clear that all
three groups feel that profits should be shared between
employees depending on their level in the company.
This was to be expected as this is current policy
within the company.
The response to the thought of profit being more
important than people was especially interesting in
that the supervisory group felt by 31% that profit is
more important than people. One would have expected
that -this level would be the least likely to respond
this way. Clearly there is a difference in perception
on this issue between management levels. (refer figure
22)
-115-
Section 4 Perceptions of how power is related to
participative management elicited an almost identical
response from all management groups.
There is clearly common perception of power at
the work place between the management groups.
Management are obviously perceived as the power
holder whether or not participative management is
operative or not.
The political rights of employees are also
clearly not an issue at the workplace,
irrespective of whether or not participative
management is operative or not.
Section 5 This section elicited the most widespread
responses, between the management groups, in the study.
In terms of whether or not top management is
committed to the principle of participative
management, there were widespread responses. Most
significant is that middle management felt by 327.
that they were not committed.
The respondents felt, almost unanimously, that
commitment from top management is necessary for a
participative management programme to be a
success.
The question as to whether or not management
style at Makro was conducive to participative
management also elicited widespread response.
Again middle management felt, by 567. that
management style was not conducive.
-116-
4. Clearly all would be committed to a
participative management style should it be
implemented at Makro. It is important to mention
that this commitment would be in accordance with
the style as each group perceives it. For example
top management would be committed to a
participative style whereby managers decide on
company goals and objectives and employees make
decisions on aspects that affect their work lives.
Section 6 It is clear from the study that the trade
union is perceived, as an important player in the
decision making process, by all groups. This
perception is strongest at the supervisory management
level, and second strongest at the top management
level.
The trade union is perceived as a more
important decision making body than employees in
the company.
Supervisory management would perceive this to
be the case because they are closest to the shop
stewards in their daily responsibilities.
Section 7 The entire sample perceive a positive
correlation between participative management and worker
motivation.
Section 8 In terms of employees having a right to be
involved in making decisions on company objectives
there are two findings.
-117--
1. Top and middle management agree to this whilst
supervisory management disagree by 707.. The
response by top management is contradictory to
their perception of participative management. The
response from the supervisory management group is
linked to the previous section in that because
they feel that the shop stewards body should be
involved in decision making they see no necessity
for employees to be involved in decision making.
They feel that the employees have the shop
stewards to serve their interests.
Section 9 Training related to participative
management was perceived differently by all management
groups.
Top management perceive training as necessary
to be able to perform in a participative
management style whilst supervisory management do
not.
Clearly supervisory management perceive
, participative management as it is, a style, as
opposed to top management who perceive it as a
more complex management tool.
Although mentioned already, it is important to say again that
training would be necessary prior to implementation of any
participative management style or system not only to ensure
common understanding and perception, but also to ensure
commitment.
-118-
6.2 RECOMMENDATIONS TO MAKRO
The object of this study was to determine whether or not
perceptions of participative management differ between differing
levels of management at Makro and whether such differences would
have an impact on the implementation of a participative
management style or system.
To conclude the study, taking cognizance of the research
results, it can be appreciated that perceptions do differ
between differing levels of management at Makro. Furthermore
these differing perceptions would be signifigant enough to
inhibit any attempt of introducing a participative management
style or system at Makro without training.
Although participative management has been around for some time
I feel that it has been greatly misunderstood by South African
managers. All too often it is perceived as some sort of panacea
to overcoming problems at the work place. Furthermore it is
seen to be a finite package implementable in all situations,
which it is not.
It is important to remember six principles upon which
participative management is based before management attempt to
implement it.
-119-
It is a management style, rather than a
management package
There will always be differences in perceptions
of participative management, between differing
people, and with those differing perceptions come
differing expectations between said people.
Top management commitment is critical to the
success of any participative management style, in
whatever form it manifests itself within the
organisation.
It is not necessarily a style which is suitable
for all organisations.
If it is misunderstood or misperceived by
management and employees within an organisation,
it could result is failure rather than success.
Employees have a right to be managed
competently, and if a participative management
,style encroaches this right in any way it should
be disregarded.
-120-
REFERENCES
Ackerman, R. 1982. Productivity: A crisis ahead. I.P.M Manpower
Journal Vol. 12 No. 2 (April)
Aft, L.S. 1983. Productivity: Measurement and improvement
Prentice Hall.
Anglo American
Industrial Relations in Jugoslavia:
Corporation. 1984
Occasional Paper, Industrial Relations
Department. Information unit - Johannesburg.
Bendix, D.W.F. 1978. Limits to co-determination. Industrial demo-
cracy in the Federal Republic of Germany
1945 - 1977. Johannesburg Lex Patria.
Bendix, D.W.F. and Quality Circles as a response to the produc-
Bocker, H.J. 1982. tivity crisis. Manpower Journal - (June).
Bocker, H.J. and Structuring Quality Circles: A management
Overgaard, H.O. 1983. challenge to combat ailing productivity. Lea-
dership and organisational development Journal
Vol. 3 No. 5
-121-
REFERENCES (Cont.)
Bobbie, R. and Want productivity improvement? Manage it
Schaeffer, R. 1982. Administrative management journal Vol. 43
No. 8 (August)
Coetzee, C. 1988. Participative Management: Cure for many
• business problems. Human Resource
management journal. (March)
Cordova, E. 1982. Workers participation in decisions within
enterprises: Recent trends and problems.
International labour review Vol. 121. No. 2.
(March-April)
Daniel, R. 1983. Making quality circles work. Management
journal. (October)
Dessler R. 1983. Improving productivity at work: Motivating
today's employees. Prentice Hall.
Douwes Dekker L.C.G Worker participation as an important process
1973. in the institutionilization of an open plural
society. Johannesburg S.A.I.R.R.
-122-
REFERENCES (cont.)
Evans, P. 198b. Quality Circles: Integrating people and
production: Productivity S.A. Vol. 12
No. 2. (April)
Falk, A. 1982. An American look at German labour rela-
tions: Personnel Journal. (March)
Hall, C. 1989. People Growth: The most rewarding and essen-
tial business commitment. Human Resource Man-
agement Journal. (Yearbook)
Hersey, P. and Management of organisational behaviour,
Blanchard, K. 1977. utilizing human behaviour resources
3rd ed New Jersey. Prentice Hall.
Hethy, L. and
Workers direct participation in decisions
Mako, C.S. 1977. in Hungarian factories: International
labour review Vol 116 No. 7
Hovels, B.W.M, Workers councils in the Netherlands: Some
Nas, P. 1977. findings from an empirical survey. The
Netherlands Journal of sociology.
-123-
REFERENCES (cont.)
Kachelhoffer G.L. Industrial democracy: Employee participation in
1978. the decisions of an undertaking. (In S.M. Smart
(ED) Employee participation: Challenge to man-
agement prerogatives.) Pretoria. Unisa
Kast, E. and Organisation and Management: A systems and
Rosenzweig, J. 1985. and contingency approach. Mcgraw - Hill.
Landel, R. 1986. Managing productivity through people: An
operation perspective. Prentice Hall.
Lickert, R. 1950
(In Katz, D. Maccoby, N. and Morse, N.
(Eds) Productivity, Supervision and Morale
in a situation. University of Michagen.
Survey Research Centre.
Mcgregor, D. 1960. The human side of enterprise. New York.
Miller, R.F. 1978. Worker self-management in Yugoslavia. The
current state of play. Journal of Industrial
Relations (Sept).
-124-
REFERENCES (Cont.)
Mulder, M. and Participation and power equalization Organi-
Wilke, H. 1970. sational behaviour and human performance.
Natrass, J. 1984. The South African economy, its growth and
change: Oxford University Dress: Cape
Town.
People and Profits, Fact sheet No. 95. Labour Relations Act
1981. (Dec.).
Poole, M. 1978. Worker Participation and Industry: London:
Rautledge and Kegan Paul.
Project Free
Economic participation in South
Enterprise, 1987. Africa. Pretoria: Unisa School of
Business Leadership.
Riddel, J. 1986. Management: The driving force: Productivity
S.A. Vol. 12. No. 2. (April)
Roethlisberger, F. Management and the worker
and Dixon, W. 1939. Cumbridge Mass: Harvard Univeristy Press.
Stogdill, R. and
Leader Behaviour: its description
Coons, A. 1957. and measurement. Columbus Ohio
State University. Bureau of business research.
-125-
REFERENCES (cont.)
Tims Items. 1988. Labour Relations edition No. 7. Editorial
Committee: Prof. Luther Backer, Mr. Derek
Weston.
Van Den Bergh, T. Enlightened Leadership enhances productivity
1988. improvements. Human Resources Management
Journal. (Sept.)
-126--
F' FR -T- I CD I -T- I V E.:. rvi P•4 9 EEE Ni EE:NI T-
1-1 EE: EE3 -T- I CD P\A Ni I FR EE:
What is your home language?
ENGLISH
AFRIKAANS
ZULU
TSWANA
N. SOTHO
S. SOTHO
XHOZA
OTHER (INDICATE)
Your sex
MALE
FEMALE
Your age
16 - 25
26 - 35
36 - 45
46 - 55
56 - 65
-127-
What is your citizenship?
BY BIRTH
PRESENTLY
What is your race?
COLOURED
BLACK
WHITE
ASIAN
What is the highest level of education you have achieved?
STD. 6.
STD. 8.
STD. 10.
DIPLOMA.
DEGREE.
Length of service with your company
LESS THAN 1 YR
UP TO 1 YEAR
UP TO 3 YEARS
UP TO 5 YEARS
UP TO 10 YEARS
UP TO 15 YEARS
-128-
What it is your current position at Makro?
POSITION
DEPARTMENT
LOCATION
How do you understand the term "PARTICIPATIVE MANAGEMENT"?
Managers participate with other managers and make decisions concerning the Company, at all levels of the company.
Managers and employees participate to make decisions, concerning the company, at all levels of the company.
Managers and employees participate to make decisions, concerning the company, at SOME levels of the company.
Employees participate and make all decisions, concerning the company, at all levels of the company.
, Shop Stewards and management make all Company decisions, at all levels of the company.
If none of the above; please enter your point of view here.
-129-
10 (a). How many subordinates report directly to you?
NUMBER OF SUBORDINATES
10 (b). Indicate the breakdown of subordinates in terms of sexual and racial composition.
(INDICATE NUMBERS)
ASIAN WHITE BLACK COLOURED
FMFMF M F M
Top Management at Makro are committed to the principle of Participative Management: (the principle as you understand it)
STRONGLY AGREE AGREE NEUTRAL
DO NOT AGREE
STRONGLY DISAGREE
Does Top Management have to be committed to the principle of participative management for it to be a success?
STRONGLY AGREE AGREE NEUTRAL
DO NOT AGREE
STRONGLY DISAGREE
Who do you believe should be entitled to have participation in the Company?
MANAGEMENT ONLY
MANAGEMENT & SHOP STEWARDS
NEUTRAL EMPLOYEES &
SHOP STEWARDS
EMPLOYEES ONLY
-130--
The dominant management style in Makro provides a favorable environment for participative management practice.
STRONGLY AGREE
AGREE NEUTRAL DO NOT AGREE
STRONGLY DISAGREE
State a reason for your answer:
If there were to be a participative management programme at Makro would you be committed to it and why would you be?
YES
NO
State a reason for your answer:
-131-
Profit is far more important than people.
AGREE FULLY
DO NOT KNOW
COMPLETELY DISAGREE
Participation will allow for an environment, in which employees will be more motivated to do their work.
AGREE FULLY
DO NOT KNOW
COMPLETELY DISAGREE
How do you understand the term "participative management" in terms of Company profits?
ALL PROFIT SHARED EQUALLY AT ALL LEVELS
PROFITS SHARED PROPORTIONATELY DEPENDING ON YOUR
LEVEL
PROFITS SHARED BY MANAGEMENT ONLY
PROFITS SHARED BY EMPLOYEES ONLY
PROFITS SHARED BY SHAREHOLDERS
ONLY
-132-
Do Employees have a right to decide on the Company's objectives?
YES COMPLETELY AGREE
MANAGEMENT AND EMPLOYEES DECIDE TOGETHER
NOT AT ALL
Do you believe that you need to be trained in order to perform in a participative management environment.
PERFORM WELL WITHOUT TRAINING
DO NOT KNOW
NEED TO BE TRAINED IN ORDER TO PERFORM
Participative management at Makro will mean that Management will no longer have power, giving the employees all the power, and the Company will suffer financially.
AGREE STRONGLY
DO NOT KNOW
DO NOT AGREE AT ALL
State reason for your answer
-133-
Participative Management means that the Union, (through the shop stewards committee) together with management, make decisions related to the Company.
STRONGLY AGREE
DO NOT KNOW
COMPLETELY DISAGREE
If Makro were to adopt a Participative management style, would you feel threatened that you would lose your job with the Company?
EXTREMELY THREATENED
WOULD NOT FEEL ANY DIFFERENT
NOT THREATENED AT ALL
State reason for your answer
-134-
24. Does participative management, in operation, mean that the political rights of employees become more important than the daily running of the business?
DEFINITELY
DO NOT KNOW i
NOT AT ALL
State a reason for your answer.
THANK YOU
-135-
16 October 1989.
Dear Mr. C. Johnstone
You have been randomly selected to take part in a study at Makro. The study requires you to complete the enclosed questionnaire and return it to me (at Makro Germiston) by no later than the 27th of October 1989.
The study is being done to compare perceptions of "participative Management" within the company. It requires total honesty about the way you interpret the questions, and the strictest confidentiality will be exercised, with your answers.
All levels of management are involved in the study and I will share the results of the study with you, once it is completed in January 1990.
It is very 'important that you complete the questionnaire because the better the response, the more valid and reliable the study will be.
Should you have any questions, or problems, please do not hesitate to contact me at the Germiston Store, at any time, or at home (011) 58-6340.
Thanking you for your participation in this study.
Yours sincerely
THIERRY FUCHSLOCH HUMAN RESOURCES MANAGER - GERM ISTON