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Simply put, quality is how good a business's products and services are. Total quality management is a set of principles to monitor overall quality in a corporation.

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TQM is a set of management practices throughout the organization, geared to ensure the organization consistently meets or exceeds customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement.

Before reading more about TQM, it might be helpful to quickly review the major forms of quality management in an organization. These are briefly described at the top of the Quality Management topic.

7 Important Principles of Total Quality Management

© Copyright Quin Harris

Total Quality Management (TQM) is an approach that organizations use to improve their internal processes and increase customer satisfaction. When it is properly implemented, this style of management can lead to decreased costs related to corrective or preventative maintenance, better overall performance, and an increased number of happy and loyal customers.

However, TQM is not something that happens overnight. While there are a number of software solutions that will help organizations quickly start to implement a quality management system, there are some underlying philosophies that the company must integrate throughout every department of the company and at every level of management. Whatever other resources you use, you should adopt these seven important principles of Total Quality Management as a foundation for all your activities.

1. Quality can and must be managed

Many companies have wallowed in a repetitive cycle of chaos and customer complaints. They believe that their operations are simply too large to effectively manage the level of quality. The first step in the TQM process, then, is to realize there is a problem and that it can be controlled.

2. Processes, not people, are the problem

If your process is causing problems, it won't matter how many times you hire new employees or how many training sessions you put them through. Correct the process and then train your people on these new procedures.

3. Don't treat symptoms, look for the cure

If you just patch over the underlying problems in the process, you will never be able to fully reach your potential. If, for example, your shipping department is falling behind, you may find that it is because of holdups in manufacturing. Go for the source to correct the problem.

4. Every employee is responsible for quality

Everyone in the company, from the workers on the line to the upper management, must realize that they have an important part to play in ensuring high levels of quality in their products and services. Everyone has a customer to delight, and they must all step up and take responsibility for them.

5. Quality must be measurable

A quality management system is only effective when you can quantify the results. You need to see how the process is implemented and if it is having the desired effect. This will help you set your goals for the future and ensure that every department is working toward the same result.

6. Quality improvements must be continuous

Total Quality Management is not something that can be done once and then forgotten. It's not a management "phase" that will end after a problem has been corrected. Real improvements must occur frequently and continually in order to increase customer satisfaction and loyalty.

7. Quality is a long-term investment

Quality management is not a quick fix. You can purchase QMS software that will help you get things started, but you should understand that real results won't occur immediately. TQM is a long-term investment, and it is designed to help you find long-term success.

Before you start looking for any kind of quality management software, it is important to make sure you are capable of implementing these fundamental principles throughout the company. This kind of management style can be a huge culture change in some companies, and sometimes the shift can come with some growing pains, but if you build on a foundation of quality principles, you will be equipped to make this change and start working toward real long-term success.

Learn More in the Library's Blog Related to Total Quality Management

In addition to the information on this current page, see the following blog which has posts related to Total Quality Management. Scan down the blog's page to see various posts. Also see the section "Recent Blog Posts" in the sidebar of the blog or click on "next" near the bottom of a post in the blog.

Library's Quality Management Blog

For the Category of Quality Management:

To round out your knowledge of this Library topic, you may want to review some related topics, available from the link below. Each of the related topics includes free, online resources.

Also, scan the Recommended Books listed below. They have been selected for their relevance and highly practical nature.
Related Library Topics Recommended Books

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TQM is a set of management practices throughout the organization, geared to ensure the organization consistently meets or exceeds customer requirements. TQM places strong focus on process measurement and controls as means of continuous improvement. Before reading more about TQM, it might be helpful to quickly review the major forms of quality management in an organization.

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Strategic control is the process of overseeing the execution of a plan.

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Even the best-laid plans can go awry-strategic planning teams know this as much as anyone. Carefully crafted strategies may not necessarily lead you astray, but they will almost always change and evolve during their standard three- to five-year implementation. It's simply a fact that your internal and external environments will change and affect your strategy as it's being implemented. For this reason, it's incredibly important to create systems of evaluation and control to monitor your organization's performance. Establishing a control process as part of strategic management allows you to immediately course-correct if planned strategies cause unintended or unexpected results.

Establishing a control process as part of strategic management allows you to immediately course-correct if planned strategies cause unintended or unexpected results. Click To Tweet

In this article, we'll walk you through the various components of a strategic control process and how an organization might apply them.

What is strategic control?

Strategic control is a way to manage the execution of your strategic plan. As a management process, it's unique in that it's built to handle unknowns and ambiguity as it tracks a strategy's implementation and subsequent results. It is primarily concerned with finding and helping you adapt to internal or external factors that affect your strategy, whether they were initially included in your strategic planning or not.

The various components of the strategic control process generate answers to these two questions:

1. Has the strategy been implemented as planned?

2. Based on the observed results, does the strategy need to be changed or adjusted?

In many senses, strategic control is an evaluation exercise focused on ensuring the achievement of your goals. The process bridges gaps and allows you to adapt your strategy as needed during implementation.

The difference between operational and strategic control processes.

In contrast to the large amount of data and extended time frame required for strategic controls to take effect, operational controls monitor and evaluate day-to-day functions to correct any problems as soon as possible. Operational controls may be either manual or automated, and can involve people, processes, and technology. When successful, they flag potential risks, identify misalignments between plans and actions, and effectively implement changes to stay on course with your strategy.

For example, if there are technical malfunctions or performance is below expectations, operational control processes can initiate a course correction quickly. This could include updating an IT system or retraining particular employees, respectively. Or, imagine a factory that produces widgets. If the number of widgets drops below expectations or the error rate rises above expectations, a process control alert should be triggered to make the proper operational change.

Strategic control, on the other hand, might then evaluate whether your hiring criteria and employee onboarding processes need adjustment in order to achieve your strategy.

Strategic Control Techniques

There are four primary types of strategic control:

Premise Control

Every organization creates a strategy based on certain assumptions, or premises. As such, premise control is designed to continually and systematically verify whether those assumptions, which are foundational to your strategy, are still true. These are typically environmental (e.g. economic or political shifts) or industry-specific (e.g. new competitors) variables.

The sooner you discover a false premise, the sooner you can adjust the aspects of your strategy that it affects. In reality, you can't review every single strategic premise, so focus on those most likely to change or have a major impact on your strategy.

Implementation Control

This type of control is a step-by-step assessment of implementation activities. It focuses on the incremental actions and phases of strategic implementation, and monitors events and results as they unfold. Is each action or project happening as planned? Are the proper resources and funds being allocated for each step? This process continually questions the basic direction of your strategy to ensure it's the right one.

There are two subcategories of implementation control:

Monitoring Strategic Thrusts Or Projects

This is the assessment of specific projects or thrusts that have been created to drive the larger strategy. This early feedback will help you decide whether to continue onward with the strategy as is or pause to make adjustments.

You can pre-determine which thrusts are critical to the achievement of your goals and continually assess them. Or, you can decide which measurements are most meaningful for your thrusts or projects (such as timeframes, costs, etc.) and use that data as an indicator of whether a thrust is on track or not, and how that may subsequently affect the strategy.

During strategic planning, you likely identified important points in the implementation process. When these milestones are reached, your organization will reassess the strategy and its relevance. Milestones could be based on timeframes, such as the end of a quarter, or on significant actions, such as large budget or resource allocations.

Implementation control can also take place via operational control systems, like budgets, schedules, and key performance indicators.

Special Alert Control

When something unexpected happens, a special alert control is mobilized. This is a reactive process, designed to execute a fast and thorough strategy assessment in the wake of an extreme event that impacts an organization. The event could be anything from a natural disaster or product recall to a competitor acquisition. In some cases, a special alert control calls for the formation of a crisis team-usually comprising members of the strategic planning and leadership teams-and in others, it merely means activating a predetermined contingency plan.

Strategic Surveillance Control

Strategic surveillance is a broader information scan. Its purpose is to identify overlooked factors both inside and outside the company that might impact your strategy. This process ideally covers any "ground" that might be missed by the more focused tactics of premise and implementation control. Your surveillance could encompass industry publications, online or social mentions, industry trends, conference activities, etc.

This graph clearly depicts the application of the four techniques for strategic control and how they function alongside each other:

Six Steps Of The Strategic Control Process

Whether your organization is using one or all four of the previous techniques of strategic evaluation and control, each involves six steps:

Step 1: Determine what to control.

What are the organization's goals? What elements directly relate to your mission and vision? It's difficult, but you must prioritize what to control because you cannot monitor and assess every minute factor that might impact your strategy.

Step 2: Set standards.

What will you compare performance against? How can managers evaluate past, present, and future actions? Setting control standards-which can be quantitative or qualitative-helps determine how you will measure your goals and evaluate progress.

Step 3: Measure performance.

Once standards are set, the next step is to measure your performance. Measurement can then be addressed in monthly or quarterly review meetings. What is actually happening? Are the standards being met?

Step 4: Compare performance.

When compared to the standards or targets, how do the actuals measure up? Competitive benchmarking can help you determine if any gaps between targets and actuals are normal for the industry, or are signs of an internal problem.

Step 5: Analyze deviations.

Why was performance below standards? In this step, you'll focus on uncovering what caused the deviations. Did you set the right standards? Was there an internal issue, such as a resource shortage, that could be controlled in the future? Or an external, uncontrollable factor, like an economic collapse?

Step 6: Decide if corrective action is needed.

Once you've determined why performance deviated from standards, you'll decide what to do about it. What actions will correct performance? Do goals need to be adjusted? Or are there internal shifts you can make to bring performance up to par? Depending on the cause of each deviation, you'll either decide to take action to correct performance, revise the standard, or take no action.

Using A Balanced Scorecard For Strategic Control

The entire strategic planning, implementation, and control process takes significant effort and thought. It requires a lot of buy-in from your leadership team. It also requires employees to understand why their actions are important and continuously work toward achievement of goals-even if those goals shift over time.

A Balanced Scorecard helps tie your overall strategy to those day-to-day activities, giving more clarity about the what and why of strategic implementation to the entire company. You'll be able to do both operational and strategic control within one framework, linking the two processes and getting everyone on the same page. The Balanced Scorecard approach can provide a clear prescription as to what companies should measure during implementation to enact strategic control.
Learn everything you need to know about Balanced Scorecards in this article.
Conclusion

Putting strategic control in place is critical to a successful strategy implementation. Without proper controls, your strategy won't have the gut checks required to ensure it remains relevant, on track, and performing at or above standards.

Managing these controls can be made easier by using software to track KPIs, measures, and the external factors around your strategy. At ClearPoint, we see many organizations using our software to take strategic control.

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Strategic Control: Breaking Down The Process & Techniques | ClearPoint Strategy

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Even the best-laid plans can go awry-strategic planning teams know this as much as anyone. Carefully crafted strategies may not necessarily lead you astray, but they will almost always change and evolve during their standard three- to five-year implementation. It's simply a fact that your internal and external environments will change and affect your strategy as it's being implemented.

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This is a study on the effects of job enrichment, a motivation technique that encourages empowering workers. They found it to be effective in many situations.

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This article reports on five of a number of job enrichment studies which were and are still being carried out in Imperial Chemical Industries Limited and other British companies. The purpose of the studies was an attempt to shed light on important job enrichment questions dealing with(1) the generality of the findings, (2) the feasibility of making changes, and (3) the consequences to be expected. In addition, the studies set out to determine how the concept of job enrichment may be most effectively applied in furthering the attainment of companies' business objectives. Among them, they cover not only widely different business areas and company functions, but also many types and levels of jobs. Collectively, they provide insights which add to management understanding of both theory and practice.

In his pioneering article, "One More Time: How Do You Motivate Employees?" ¹ Frederick Herzberg put forward some principles of scientific job enrichment and reported a successful application of them involving the stockholder correspondents employed by a large corporation. According to him, job enrichment seeks to improve both task efficiency and human satisfaction by means of building into people's jobs, quite specifically, greater scope for personal achievement and its recognition, more challenging and responsible work, and more opportunity for individual advancement and growth. It is concerned only incidentally with matters such as pay and working conditions, organizational structure, communications, and training, important and necessary though these may be in their own right.

But like a lot of pioneering work, Herzberg's study raised more questions than it answered. Some seemed t o us to merit further consideration, particularly those in regard to the (1)generality of the findings, (2) feasibility of making changes, and (3) consequences to be expected. Consider:

1. Generality -Can similarly positive results be obtained elsewhere with other people doing different jobs? How widespread is the scope or need for equivalent change in other jobs? Can meaningful results be obtained only in jobs with large numbers of people all doing the same work and where performance measures are easily available?

2. Feasibility -Are there not situations where the operational risk is so high that it would be foolhardy to attempt to pass responsibility and scope for achievement down the line? Because people's ability and sense of responsibility vary so much, is it not necessary to make changes selectively? Do all employees welcome having their jobs enriched, or are there not some who prefer things to be left as they are? Can one enrich jobs without inevitably facing demands for higher pay or better conditions to match the new responsibilities? And, in any case, is not the best route to motivational change through participation?

3. Consequences -In view of so many possible difficulties in the way, are the gains to be expected from job enrichment significant or only marginal? Do they relate primarily to job satisfaction or to performance? What are the consequences for supervision if jobs are loaded with new tasks taken from above-i.e., does one man's enrichment become another's impoverishment? Finally, what are the consequences for management if motivational change becomes a reality? Is the manager's role affected? If so, how? And what are the implications for management development?

There are undoubtedly more questions that could be raised and investigated. But these seem particularly important from a corporate point of view if job enrichment is to take place on a widespread basis, as part of management practice rather than as a research activity. Accordingly, the purpose of this article is to probe into the complexities of job enrichment in an attempt to shed light on these questions and to determine how the concept may be most effectively applied in furthering the attainment of corporate business objectives.

In order to do this, we shall report in Part I on five studies carried out in Imperial Chemical Industries Limited and other British companies. Two of the studies-covering laboratory technicians in an R&D department and sales representatives in three companies-will be examined in some detail. The other three-encompassing design engineers, production foremen on shift work, and engineering foremen on day work-will be summarized. In Part II, the main conclusions emerging from the studies will be presented in the form of answers to the questions raised at the beginning of this article.

Each study was initiated in response to a particular problem posed by management, and the conclusions drawn from any one can be only tentative. Among them, however, they cover not only widely different business areas and company functions, but also many types and levels of jobs. Collectively, they provide material which adds to our understanding of both theory and practice.

Part I: The Job Enrichment Studies

As in all studies on job satisfaction and performance, the need to measure results introduced certain constraints which do not exist in normal managerial situations. Consequently, three main features were common to the studies we are reporting in this discussion:

First, the "hygiene" was held constant. This means that no deliberate changes were made as part of the investigation, in matters such as pay, security, or working conditions. The studies were specifically trying to measure the extent of those gains which could be attributed solely to change in job content.

Second, recognition of the normal hygiene changes led to the need to have an "experimental group" for whom the specific changes in job content were made, and a "control group" whose job content remained the same.

Third, the studies had to be kept confidential to avoid the well-known tendency of people to behave in an artificial way when they know they are the subject of a controlled study. Naturally, there was no secret about the changes themselves, only about the fact that performance was being measured.

All studies set out to measure job satisfaction and performance for both the experimental and control groups over a trial period following the implementation of the changes. The trial period itself generally lasted a year and was never less than six months. The performance measures always were specific to the group concerned and were determined by local management of the subject company. To measure job satisfaction, we relied throughout on a job reaction survey which measures the degree of people's satisfaction with the motivators in their job as they themselves perceive them.

Laboratory technicians

Managers in an industrial research department were concerned about the morale of laboratory technicians, or "experimental officers" (EOs). This group's job was to implement experimental programs devised by scientists. The EOs set up the appropriate apparatus, recorded data, and supervised laboratory assistants, who carried out the simpler operations. The EOs were professionally qualified people, but lacked the honors or doctorate degrees possessed by the scientists.

The average age of the experimental officers was increasing. A quarter of them had reached their salary maximums, and fewer now had the chance to move out of the department. Their normal promotion route into plant management had become blocked as manufacturing processes grew more complex and more highly qualified people filled the available jobs. Management's view of the situation was confirmed by the initial job reaction survey. Not only were the EOs' scores low, but many wrote of their frustration. They felt their technical ability and experience was being wasted by the scientists' refusal to delegate anything but routine work.

Against this background, the research manager's specific objective was to develop the EOs into "better scientists." If job enrichment was to be useful, it would have to contribute to the attainment of that goal.

Changes & experimental design

Here is the specific program of action devised and implemented for the experimental officers.

Technical:

EOs were encouraged to write the final report, or "minute," on any research project for which they had been responsible. Such minutes carried the author's name and were issued along with those of the scientists. It was up to each EO to decide for himself whether he wanted the minute checked by his supervisor before issue, but in any case he was fully responsible for answering any query arising from it.

EOs were involved in planning projects and experiments, and were given more chance to assist in work planning and target setting.

They were given time, on request, to follow up their own ideas, even if these went beyond the planned framework of research. Written reports had to be submitted on all such work.

Financial:

EOs were authorized to requisition materials and equipment, to request analysis, and to order services such as maintenance, all on their own signature.

Managerial:

Senior EOs were made responsible for devising and implementing a training program for their junior staff. In doing so, they could call on facilities and advice available within the company.

Senior EOs were involved in interviewing candidates for laboratory assistant jobs, and they also acted as first assessor in any staff assessment of their own laboratory assistants.

These changes drew on all the motivators. Each one gave important chances for achievement; together, they were designed to make the work more challenging. Recognition of achievement came in the authorship of reports. Authority to order supplies and services was a responsibility applying to all the EOs involved. The new managerial responsibilities reserved to senior EOs opened up room for advancement within the job, while the technical changes, particularly the opportunity for self-initiated work, gave scope for professional growth.

Some 40 EOs in all were involved in the study. Two sections of the department acted as experimental groups (N = 15) and two as control groups (N = 29). One experimental and one control group worked closely together on the same type of research, and it was anticipated that there would be some interaction between them. The other two groups were separate geographically and engaged on quite different research.

The changes were implemented for the experimental groups during October and November 1966, and the trial period ran for the next twelve months. After six months, the same changes were introduced into one of the control groups, thus converting it into an experimental group (N = 14). This was done to see whether a similar pattern of performance revealed itself, thereby safeguarding against any remote possibility of coincidence in the choice of the original groups.

Research work is notoriously difficult to measure, but as the aim was to encourage more scientific contribution from EOs, this was what had to be judged in as objective a way as possible. All EOs were asked to write monthly progress reports of work done. Those written by experimental and control group EOs were assessed by a panel of three managers, not members of the department, who were familiar with the research work concerned.

Reports were scored against eight specifically defined criteria thought to reflect the kind of growth being sought: knowledge, comprehension, synthesis, evaluation, original thought, practical initiative, industry, and skill in report writing. Whenever the assessor found particular evidence of one of these qualities in a report, he would award it one mark, the total score for a report being simply the sum of these marks.

In order to establish a baseline for clarifying standards and testing the assessors' consistency of marking, reports were collected for three months prior to the introduction of any job enrichment changes. The very high consistency found between the marking of the three assessors encouraged confidence in the system. The assessors, naturally, were never told which were the experimental and control groups, though it became easy for them to guess as the trial period went on.

The other main measure was to use the same system to assess research minutes written by the EOs. These were compared against an equivalent sample of minutes written by scientists over the same period, which were submitted to the panel for assessment, again without identification.

Motivational results

The assessment of monthly reports written by the experimental officers is given in Exhibit I, which compares the mean score achieved by all experimental group EOs each month with that achieved by all control group EOs. On occasions when a monthly report had obviously suffered because of the attention devoted to writing a research minute covering much the same ground, a marginal weighting factor was added to the score depending on the quality of the minute concerned. Both experimental and control groups improved their monthly report scores at about the same rate during the first five months. There is no doubt that with practice all were getting better at report writing, and it may be that the mere fact of being asked to write monthly reports itself acted as a motivator for both groups.

Exhibit I. Assessment of EOs monthly reports

Once the changes had been fully implemented in the experimental groups, however, performance began to diverge. Although the reports of the control groups continued to improve for a time, they were far outpaced by those of the experimental groups. With some fluctuations, this performance differential was maintained throughout the rest of the trial period. When, after six months, the motivators were fed into one of the two control groups, its performance improved dramatically, following the pattern achieved by the original experimental groups. Meanwhile, the performance of the other control group, unaffected by what was happening elsewhere, began to slip back toward its original starting point.

During the 12 months of the trial period, a total of 34 research minutes were written by EOs, all from the experimental groups, compared with 2 from the department as a whole during the previous 12-month period. There were also a number of minutes jointly authored by scientists and EOs, which are excluded from this analysis. Of the 34 being considered, 9 were written by EOs in the control group which was converted into an experimental group, but all came from the time after the changes had been introduced.

It is one thing for laboratory technicians to write research minutes, but whether the minutes they write are any good or not is a different matter. Exhibit II shows the quality of the EOs' minutes compared with that of the scientists'. The EOs' mean score was 8.7; the scientists' 9.8. All EO scores except three fell within the range of scores obtained by the scientists; the three exceptions were written by one man. Three of the EOs' minutes, one in fact written by a laboratory assistant with guidance from an EO, were judged to be as good as the best of the scientists' minutes.

Exhibit II. Assessment of EOs research minutes

Encouraged by the success of a training scheme designed for laboratory assistants, the EOs initiated one for themselves. It aimed to give them the opportunity to come to terms with the ideas and terminology of chemical engineering. Managers judged it to have been of considerable value, and one EO summed it up by saying, "A couple of pages of chemical engineering calculations and formulas won't frighten us off now."

One original idea followed up, as the changes now permitted, by an EO from an experimental group resulted in an important discovery with possible applications in certain kinds of national emergency. The idea was investigated further by a government department, which described it as the most promising of some 200 ideas submitted on that topic.

Three staff assessments on EOs were carried out-at the beginning, middle, and end of the trial period. Each followed the normal company procedure. The only group which showed a consistent improvement was one of the experimental groups.

The job reaction survey was given both before and after the trial period. In the initial survey, experimental and control group EOs could not be specifically identified, and so an exact comparison of the before and after scores of each group cannot be made. The overall mean score attained by all EOs in the department was no higher at the end of the trial period than it had been at the beginning. Although managers believed there had been a positive change in job satisfaction, that is not a conclusion which can be supported with data.

An internal company report, written by the personnel officer who managed and coordinated the study throughout, concluded that there had been definite evidence of growth among the EOs, particularly in one group, and that much useful work had been accomplished during the exercise. One of the experimental groups had been able to keep abreast of its commitments even though it lost the services of two of its six scientists during the trial period and functioned without a manager for the last five months of the study. There can be little doubt that job enrichment in this case helped to further the research manager's objective of tackling a morale problem by getting at the root of the matter and developing experimental officers as scientists in their own right.

Sales representatives

To investigate the potential of job enrichment in the sales field, work has been done in three British companies dealing with quite different products and markets, both wholesale and retail. In only one study, however, were experimental conditions strictly observed.

The company concerned had long enjoyed a healthy share of the domestic market in one particular product range, but its position was threatened by competition. A decline in market share had been stabilized before the study began, but 1967 sales still showed no improvement over those of 1966. So far as could be judged, the company's products were fully competitive in both price and quality. The critical factor in the situation appeared to be sales representatives' effort.

The representatives' salaries-they were not paid a commission-and conditions of employment were known to compare well with the average for the industry. Their mean score in the job reaction survey, like that of other groups of salesmen, was higher than most employees of equivalent seniority, which suggested that they enjoyed considerable job satisfaction.

The problem in this case, therefore, was that for the vital business objective of regaining the initiative in an important market, sustained extra effort was needed from a group of people already comparatively well treated and reasonably satisfied with their jobs. Here, job enrichment would stand or fall by the sales figures achieved.

Changes & experimental design

Here is the specific program of action devised and implemented for the sales representatives.

Technical:

Sales representatives were no longer obliged to write reports on every customer call. They were asked simply to pass on information when they thought it appropriate or request action as they thought it was required.

Responsibility for determining calling frequencies was put wholly with the representatives themselves, who kept the only records for purposes such as staff reviews.

The technical service department agreed to provide service "on demand" from the representatives; nominated technicians regarded such calls as their first priority. Communication was by direct contact, paperwork being cleared after the event.

Financial:

In cases of customer complaint about product performance, representatives were authorized to make immediate settlements of up to $250 if they were satisfied that consequential liability would not be prejudiced.

If faulty material had been delivered or if the customer was holding material for which he had no further use, the representative now had complete authority, with no upper limit in sales value, to decide how best to deal with the matter. He could buy back unwanted stock even if it was no longer on the company's selling range.

Representatives were given a discretionary range of about 10% on the prices of most products, especially those considered to be critical from the point of view of market potential. The lower limit given was often below any price previously quoted by the company. All quotations other than at list price had to be reported by the representative.

The theme of all the changes was to build the sales representative's job so that it became more complete in its own right. Instead of always having to refer back to headquarters, the representative now had the authority to make decisions on his own-he was someone the customer could really do business with. Every change implied a greater responsibility; together they gave the freedom and challenge necessary for self-development.

The company sold to many different industries, or "trades." In view of the initial effort needed to determine limit prices and to make the technical service arrangements, it was decided that the study should concentrate on three trades chosen to be typical of the business as a whole. These three trades gave a good geographical spread and covered many types of customers; each had an annual sales turnover of about $1 million.

The experimental group (N = 15) was selected to be representative of the sales force as a whole in age range, experience, and ability. An important part of each member's selling responsibility lay within the nominated trades. The rest of the sales force (N = 23) acted as the control group. The changes were introduced during December 1967, and the trial period ran from January 1 to September 30, 1968.

The background of static sales and the objective of recapturing the market initiative dictated that sales turnover would be the critical measure, checked by gross margin. The difficulties of comparing unequal sales values and allowing for monthly fluctuations and seasonal trends were overcome by making all comparisons on a cumulative basis in terms of the percentage gain or loss for each group against the equivalent period of the previous year.

Since they were selling in the same trades in the same parts of the country, the performance of all the representatives was presumably influenced by the same broad economic and commercial factors. In two of the trades, the experimental group had the bigger share of the business and tended to sell to the larger customers. In these cases it may be surmised that prevailing market conditions affected the experimental group's performance, favorably or unfavorably, more than the control group's. As it happened, in one of these trades commercial trends were favorable, while in the other they were distinctly unfavorable. In the third trade, the experimental and control groups were evenly matched. Taken together, then, the three trades give as fair a comparison as can be obtained between the performances of sales representatives under those two sets of conditions.

Motivational results

During the trial period the experimental group increased its sales by almost 19% over the same period of the previous year, a gain of over $300,000 in sales value. The control group's sales in the meantime declined by 5%. The equivalent change for both groups the previous year had been a decline of 3%. The difference in performance between the two groups is statistically significant at the 0.01 level of confidence.

Exhibit III shows the month-to-month performance of the two groups, plotted cumulatively. It can be seen that the control group in fact started the year extremely well, with January/ February sales in the region of 30% above the equivalent 1967 figures. This improvement was not sustained, however, and by May cumulative sales had dropped below their 1967 level. By the last five months of the trial period, performance was running true to the previous year's form, showing a decline of about 3%.

Exhibit III. Sales turnover within trades chosen as typical of the business as a whole

The experimental group, on the other hand, started more modestly, not exceeding a 20% improvement during the first quarter. During the second quarter, outstanding results in May compensated for poorer figures in April and June. The third quarter showed a steady, if slight, rise in the rate of improvement over 1967. This sustained increase of just under 20% was in marked contrast to the previously declining performance of the trades as a whole.

Comparisons with other trades suffer from the disadvantage that different economic and commercial factors affect the various parts of the business. Nevertheless, the experimental group's performance was consistently between 6% and 7% better than that for the rest of the business. Exhibit IV shows the month-to-month picture. It can be seen not only that the experimental group maintained a higher rate of improvement than the rest of the business throughout the trial period, but that the gap widened if anything as time went on. At the 1967 rates of turnover, this performance differential in all trades would be worth $1.5 million in sales value in a full year.

Exhibit IV. Sales turnover: experimental group and rest of business

In view of the greater negotiating authority granted to the experimental group representatives, it is important to check whether their substantial increase in turnover was achieved at the expense of profit. As all quotations other than at list price were reported by the representatives, it was possible to analyze the gross margin achieved by both groups. The analysis showed without doubt that the gross margin of the experimental group's sales was proportionally as high, if not higher, than that of the control group's sales.

Managers had the impression that representatives actually used their price discretion less often than they had previously asked for special prices to be quoted by the sales office. Also, in the sales manager's view, once the representatives were given real negotiating authority, they discovered that price was not the obstacle to sales which they had always imagined it to be. Under the new arrangements, they were able to assess more completely what the true obstacles to sales were in each individual case.

Over the trial period the control group's mean score in the job reaction survey remained static. In contrast, the experimental group's score rose by 11%.

Design engineers

The engineering director of one of the divisions of ICI wanted to see whether the job of design engineer might lend itself to motivational change. His design department faced an increasing work load as more design work for the division's plants was being done internally. The situation was exacerbated by difficulties in recruiting qualified design engineers. People at all levels in the department were being overloaded and development work was suffering.

Changes & experimental design

Here is the specific program of action devised and implemented for the design engineers.

Technical:

Experienced engineers were given a completely independent role in running their projects; the less experienced technical men were given as much independence as possible. Occasions on which reference to supervision remained obligatory were reduced to an absolute minimum. The aim was that each engineer should judge for himself when and to what extent he should seek advice.

Group managers sponsored occasional investigatory jobs, and engineers were encouraged to become departmental experts in particular fields. They were expected to follow up completed projects as they thought appropriate.

When authority to allocate work to outside consultants was given, the engineers were to have the responsibility for making the choice of consultants.

Financial:

Within a sanctioned project with a budget already agreed on, all arbitrary limits on engineers' authority to spend money were removed. They themselves had to ensure that each "physical intent" was adequately defined and that an appropriate sum was allocated for it in the project budget. That done, no financial ceiling limited their authority to place orders.

Managerial:

Engineers were involved in the selection and placing of designers (drawing office staff). They manned selection panels, and a recruit would only be allocated to a particular engineer if the latter agreed to accept him.

Experienced engineers were asked to make the initial salary recommendations for all their junior staff members.

Engineers were allowed to authorize overtime, cash advances, and traveling expenses for staff:

Motivational results

In summary fashion, these are the deductions that can be drawn from this study:

Senior managers saw a change in both the amount and the kind of consultation between experimental group design engineers and their immediate supervisors. The supervisors' routine involvement in projects was much reduced, and they were able to give more emphasis in their work to technical development. Some engineers still needed frequent guidance, others operated independently with confidence. The point is that not all were restricted for the benefit of some; those who could were allowed to find their own feet.

The encouragement of specialist expertise among design engineers was a long-term proposition, but progress was made during the trial period.

The removal of any financial ceiling on engineers' authority to place orders within an approved project with an agreed budget proved entirely effective. Whereas before the design engineers had to seek approval from as many as three higher levels of management for any expenditure over $5,000-a time-consuming process for all concerned-now they could, and did, place orders for as much as $500,000 worth of equipment on their own authority.

There is no evidence of any poor decision having been taken as a result of the new arrangements. In fact, at the end of the trial period, none of the senior managers concerned wanted to revert to the old system.

The changes involving the engineers in supervisory roles were thought by the senior managers to be at least as important as the other changes, possibly more so in the long term.

There was no doubt about the design engineers' greater involvement in the selection process, which they fully accepted and appreciated. Significantly, they began to show a greater feel for the constraints involved in selection.

The responsibility for overtime and travel claims was fully effective and taken in people's stride. There was no adverse effect from a budgetary control point of view.

The involvement of design engineers in making salary recommendations for their staff was considered by the senior managers to have been a major improvement. If anything, engineers tended to be "tighter" in their salary recommendations than more senior management. There was general agreement that the effectiveness of this change would increase over time.

Senior managers felt that none of the changes of its own accord had had an overriding effect, nor had all problems been solved. But there was no doubt that the cumulative effect of the changes had been significant and that the direction of solutions to some important problems had been indicated.

The changes may have been effective, but in this particular study the important question was whether they had a significant impact on job satisfaction. Some of the motivators introduced into the experimental groups had been in operation in the control group for some time; others-because of the specialist nature of the control group's work-were not as important to it as to the experimental groups. The control group had scored high in the initial job reaction survey, while the experimental groups had both achieved very low scores. If the experimental groups' scores did not improve, doubt would inevitably be cast on the relationship between job content and job satisfaction. As it turned out, comparison results of the before and after job reaction surveys revealed that the mean scores of the two experimental groups had increased by 21% and 16%, while those of the control group and all other design engineers in the department had remained static.

Factory supervisors

The final two studies, one in ICI and one in another British company, concerned factory supervisors: production foremen on shift work fabricating nonferrous metals, and engineering foremen on day work providing maintenance services. As the two studies seem to be complementary, they are considered jointly.

In both cases management was concerned about the degree to which the traditional role of the foreman had been eroded in recent years. The increasing complexity of organizational structures, plant and equipment, and industrial relations had left the foreman isolated. Decisions in the areas of planning, technical control, and discipline-originally in his province-were now passed up the line or turned over to a specialist staff. Many managers believed that as a consequence small problems too often escalated unnecessarily, managers were being overloaded, and day-to-day relationships between the foreman and his men had been weakened.

Changes & experimental design

Here is the specific program of action devised and implemented for the production and engineering foremen.

Technical:

Foremen were involved more in planning. Production foremen were authorized to modify schedules for loading and sequencing; engineering foremen were consulted more about organizational developments, given more responsibility for preventive maintenance, and encouraged to comment on design.

All were assigned projects on specific problems such as quality control, and could draw on the necessary resources for their implementation.

Other changes included giving foremen more "on the spot" responsibility, official deputizing for engineers, the writing of monthly reports, and more recognition of foremen's achievement of plans.

Financial:

Engineering foremen were given complete control of certain "on cost" budgets. Production foremen were encouraged to make all decisions on nonstandard payments.

Managerial:

Production foremen were given the authority to hire labor against agreed manning targets. They interviewed candidates for jobs and made the decision on their selection.

All the foremen were given complete disciplinary authority, except for dismissal. They decided what disciplinary action to take, consulted the personnel department if they thought it necessary, conducted the interviews, and kept the records.

All were given formal responsibility for the assessment, training, and development of their subordinates, and in some cases for the appointment of their own deputies. On the production side, a newly appointed training officer acted as a resource person for the foremen. Engineering foremen were involved more in the application of a job appraisement scheme and in joint consultation and negotiation with union officials.

The objective of integrating the foreman more fully into the managerial team dictated that responsibility should be the motivator chiefly concerned in these changes. Control of his own labor force, backed up by more technical and financial responsibility, was designed to give the foreman more opportunities for achievement and personal growth in the job. The main issue in these studies was whether foremen would prove themselves capable of carrying the increased responsibility. Thus, in monitoring the effectiveness of the changes, the aim was primarily to detect any instability or shortcomings in performance.

Motivational results

In summary fashion, these are the deductions that can be drawn from this study:

In six months the production foremen recruited nearly 100 men, and were judged by the personnel officer to be "hiring a better caliber of man at an improved rate." Their immediate supervisors were categorical in their approval and noted that the foremen were taking special care to "design their own shifts." Recruitment interviews were said to have improved the foremen's ability to handle encounters with existing staff and shop stewards.

Training was handled equally successfully by the production foremen. For each job it was specified that there should be a certain number of men trained to take over in an emergency. During the trial period, the margin by which the target number was missed was reduced from 94 to 55; the number of operators unable to do another's job fell by 12%, and the number of assistants unable to do the job of the man they assisted fell by 37%. No comparable improvement was achieved in the control group.

It became clear from both studies that foremen were fully capable of carrying disciplinary responsibility. An analysis of all cases arising during the trial year showed that there had been a reduction in the number of "repeat offenses" among employees with poor disciplinary records and a substantial reduction in short-term work stoppages. The analysis concluded that foremen were not prone to take one kind of action rather than another, they had developed a purposeful approach to such problems, and there had been no adverse union reaction.

About 50% of the engineering foremen's monthly reports during the trial year referred to consultation and negotiation with union officials-this on a site not noted for its harmonious industrial relations. Topics included demarcation, special payments, and the easing of bans imposed on "call outs." The incidence of such reports was spread evenly throughout the experimental group; their frequency increased during the trial period as the foremen became more confident of their abilities. All such matters appear to have been handled capably.

From both studies came evidence, confirming what has long been demonstrated in training courses, that special investigatory projects give foremen much needed opportunity to contribute their experience and expertise to the solution of long-standing technical and organizational problems. In only three cases where financial evaluation was possible, the estimated annual savings totaled more than $125,000.

Regarding the engineering foremen's control of budgets, in some cases the aim was to meet the target exactly; in others it was to reduce costs as much as possible. Both aims were achieved by the foremen at least as well as they had been by the managers. There is no evidence that plant efficiency or work effectiveness suffered in any way as a result of cost savings achieved by the foremen.

In the case of the engineering foremen, the experimental group's staff assessments at the end of the trial year were markedly better than those of the control groups. Despite the attempt made in the initial selection of experimental and control groups to achieve as good a balance as possible in ability and experience, there can be little doubt that the experimental group did in any case contain some more able men. But no one anticipated that such a large difference would show itself at the end of the trial period. As evidence of development, 45% of the experimental group's assessments referred to significant improvements in performance during the year, and 36% made particular mention of how effectively the foreman had dealt with increased responsibility received during the year. These assessments were written by managers who were not party to the study.

In the production foremen's study, superintendents reported that the new conditions were "separating the wheat from the chaff"; some of those who had previously been thought to be among the best of the foremen had not lived up to their reputations in a situation which placed little value on compliance, while others had improved enormously.

The production foremen's job reaction survey scores showed no particular improvement over the trial period. In the case of the engineering foremen, the experimental group's mean score showed a 12% increase, while the control group's had only risen by 3%.

Part II: The Main Conclusions

What has been described in the first part of this article is the consistent application of theory in an area where custom and practice are normally only challenged by individual hunch or intuition. As we have seen, each study posed a separate problem concerning a different group of employees; the only common element among them was the conceptual framework brought to bear on the problem, enabling a specific program of action to be devised and implemented. Much was learned in the process, by ourselves and managers alike.

Now in Part II, the main conclusions which emerged from the job enrichment studies are presented in the form of answers to the questions raised at the beginning of this article.

Generality of findings
Can similarly positive results be obtained elsewhere with other people doing different jobs?
Yes. The studies reflect a diversity of type and level of job in several company functions in more than one industry. From the evidence now available, it is clear that results are not dependent on any particular set of circumstances at the place of study. Our investigation has highlighted one important aspect of the process of management and has shown that disciplined attention to it brings results. The findings are relevant wherever people are being managed.
How widespread is the scope or need for equivalent change in other jobs?
The scope seems enormous. In brainstorming sessions held to generate ideas for change in the jobs covered by the studies, it was not uncommon for over a hundred suggestions to be entertained. The process of change in these particular jobs has started, not finished. In many places it has not even started. Though there probably are jobs which do not lend themselves to enrichment, we have never encountered a level or a function where some change has not seemed possible. It is difficult to say in advance what jobs are going to offer the most scope; the most unlikely sometimes turn out to have important possibilities. We have certainly not been able to conclude that any area of work can safely be left out of consideration.

The need is as deep as the scope is wide. The responsiveness of so many people to changes with a common theme suggests that an important and widespread human need has indeed been identified in the motivators. Moreover, it would seem to be a need which manifests itself in a variety of ways. If, from a company point of view, a gain once demonstrated to be possible is accepted as a need, then the performance improvements registered in these studies would seem to betray an organizational need which is far from fully recognized as yet.
Can meaningful results be obtained only in jobs with large numbers of people all doing the same work, and where performance measures are easily available?
No. Meaningful results can be obtained in situations very far from the experimental ideal. Indeed, the very awkwardness of many "real-life" situations leads to perceptions which could not come from a laboratory experiment.

Organizational changes are made, work loads fluctuate, people fall sick, managers are moved, emergencies have to be dealt with. The amount of attention which can be given to managing changes designed to enrich people's jobs is often slight. When a man's immediate supervisor does not even know that a study is taking place, there is no vested interest in its success. In circumstances such as these, whatever is done stands or falls by its own merits.

In few of the studies could members of the experimental groups be said to be doing exactly the same work. Changes sometimes had to be tailor-made to suit specific individual jobs. Yet from the diversity of application came an understanding of the commonality of the process. Although laboratory technicians were engaged in quite different kinds of research, they were all doing research work; although foremen were looking after radically different operations, they were all supervising.

The changes that seemed to have the most impact were precisely those which related to the common heart and substance of the role played by people whose jobs differed in many important details. More than this, it became clear that all of them-the laboratory technician following up an original idea, the design engineer buying equipment, the foreman taking disciplinary action, the sales representative negotiating in the customer's office-are essentially in the same situation, the crux of which is the private encounter between an individual and his task. Only a change which impacts on this central relationship, we believe, can be truly effective in a motivational sense.

Real-life conditions not only give an investigation authenticity; they highlight the problem of measurement. What is most meaningful to a manager, of course-a foreman's proprietary attitude toward his shift, for example-is not always quantifiable. An important discovery, however, was that the better the motivator, the more likely it was to provide its own measure. Employees' "sense of responsibility," judged in a vacuum, is a matter of speculation; but the exercise of a specific responsibility, once given, is usually capable of meaningful analysis. Laboratory technicians may or may not be thought to have innate potential; the number and quality of their research minutes can be measured. Several times managers commented that job enrichment had opened up measurement opportunities which not only allowed a more accurate assessment of individual performance, but often led to a better diagnosis of technical problems as well.

Feasibility of change
Are there not situations where the operational risk is so high that it would be foolhardy to attempt to pass responsibility and scope for achievement down the line?
Probably there are, but we have not encountered one. The risks attached to some of the changes in the sales representatives' study seemed frightening at the time. Few managers who have not tried it can accept with equanimity the thought of their subordinates placing orders for $500,000 worth of equipment on their own authority, even within a sanctioned project. The research manager in the laboratory technicians' study concluded that a change was only likely to be motivational for his subordinates if it made him lose sleep at nights.

Yet in no case did disaster result. In reviewing the results of the studies with the managers concerned, it was difficult in fact for us as outsiders not to have a sense of anticlimax. By the end of the trial period, the nerve-racking gambles of a few months before were hardly worth a mention. The new conditions seemed perfectly ordinary. Managers had completely revised their probability judgments in the light of experience.

Theory provides an explanation for the remarkable absence of disaster experienced in practice. Bad hygiene, such as oppressive supervision and ineffectual control systems, constrains and limits performance, and may even lead to sabotage. Administrative procedures that guard against hypothetical errors and imaginary irresponsibility breed the very carelessness and apathy which result in inefficiency. With too many controls, responsibility becomes so divided that it gets lost. Hygiene improvements at best lift the constraints.

The motivators, on the other hand, make it possible for the individual to advance the base line of his performance. The road is open for improvement, while present standards remain available as a reference point and guide. When a man is given the chance to achieve more, he may not take that chance, but he has no reason to achieve less. The message of both theory and practice is that people respond cautiously to new responsibility; they feel their way and seek advice. When responsibility is put squarely with the person doing a job, he is the one who wants and needs feedback in order to do his job. His use of the motivators, not our use of hygiene, is what really controls performance standards.

As managers, we start having positive control of the job only when we stop concentrating on trying to control people. Mistakes are less likely, not more likely, than before; those which do occur are more likely to be turned to account, learned from, and prevented in the future, for they are seen to matter. Monitoring continues, but its purpose has changed. Now it provides the jobholder with necessary information and enables management to see how much more can be added to a job rather than how much should be subtracted from it. That way, continual improvement, while not being guaranteed, at least becomes possible as the scope for the motivators is extended. It is the nearest thing to a performance insurance policy that management can have.

Such is the theory, and from the evidence of the studies, practice bears it out. If the studies show anything, they show that it pays to experiment. No one is being asked to accept anything on faith; what is required is the courage to put old assumptions and old fears to the test. For the manager, the process is like learning to swim: it may not be necessary to jump in at the deep end, but it surely is necessary to leave the shallow end. Only those who have done so are able to conquer the fear which perverts our whole diagnosis of the problem of managing people.
Because people's ability and sense of responsibility vary so much, is it not necessary to make changes selectively?
No. To make changes selectively is never to leave the shallow end of the pool. We are in no position to decide, before the event, who deserves to have his job enriched and who does not. In almost every study managers were surprised by the response of individuals, which varied certainly, but not always in the way that would have been forecast. As the job changed, so did the criteria of successful performance change. Some people who had been thought to be sound and responsible under the old conditions turned out merely to have been yes-men once those conditions were changed; their performance was the same as it had always been, but now compliance was no longer valued so highly. At the other extreme was one classic example of an awkward employee, about to be sacked, who turned out to be unusually inventive and responsible when he has given the opportunity to be so.

In one study, not reported, a promising set of changes brought relatively disappointing results-the changes had been implemented selectively. When pressed to explain the grounds on which people had been chosen, the manager quoted as an example someone who had already carried similar responsibility in a previous job. It is exactly this kind of vicious circle that job enrichment seeks to break.

When changes are made unselectively, the genuinely good performers get better. Some poor performers remain poor, but nothing is lost. Because the changes are opportunities and not demands, all that happens is that the less able ignore them and go on as before. Some people, however, develop as they never could under the old conditions, and do better than others originally rated much higher. This is the bonus from job enrichment. Not only is overall performance improved, but a clearer picture emerges of individual differences and potential.

So long as a foundation of new job opportunities available to all is firmly established, there is no harm in restricting certain changes to the more senior of the jobholders. Such changes can be seen in both the laboratory technicians' and the design engineers' studies. This is a very different matter from introducing changes selectively in the first place. It is a way of providing scope for personal advancement within the job and recognizing the achievements of those who build well on the foundation of opportunity already provided.
Do all employees welcome having their jobs enriched, or are there not some who prefer things to be left as they are?
Individual reaction to job enrichment is as difficult to forecast in terms of attitudes as it is in terms of performance. Those already genuinely interested in their work develop real enthusiasm. Not all people welcome having their jobs enriched, certainly, but so long as the changes are opportunities rather than demands, there is no reason to fear an adverse reaction. If someone prefers things the way they are, he merely keeps them the way they are, by continuing to refer matters to his supervisor, for example. Again, there is nothing lost.

On the other hand, some of the very people whom one might expect to duck their chance seize it with both hands, developing a keenness one would never have anticipated. In attitudes as well as in performance, the existence of individual differences is no bar to investigating the possibilities of job enrichment.
Can you enrich jobs without inevitably facing demands for higher pay or better conditions to match the new responsibilities?
Yes. In no instance did management face a demand of this kind as a result of changes made in the studies. It would seem that changes in working practice can be made without always having a price tag attached.

Here, as in the matter of operational risk, what is surprising in practice is easily explicable in terms of theory. The motivators and the hygiene factors may not be separate dimensions in a manager's analysis of a situation, but they are in people's experience. It is time that our diagnosis of problems took more account of people's experience. The studies demonstrate again that, when presented with an opportunity for achievement, people either achieve something or they do not; when allowed to develop, they either respond or stay as they are. Whatever the result, it is a self-contained experience, a private encounter between a person and his task.

It is something quite separate when the same person becomes annoyed by his poor working conditions, worries about his status or security, or sees his neighbors enjoying a higher standard of living. The cause-effect relationship between hygiene and motivation scarcely exists. Motivation is not the product of good hygiene, even if bad hygiene sometimes leads to sabotage. Higher pay may temporarily buy more work, but it does not buy commitment. Nor does commitment to a task, by itself, bring demand for better hygiene.

Managers often complain of their lack of room for maneuver. In doing so, they are generalizing from the rules of the hygiene game to the total management situation. There is little evidence that the workforce in fact prostitutes its commitment to a task, although incentive bonus schemes, productivity bargaining, and the like assiduously encourage such prostitution. Before the process goes too far, it seems worth exploring more fully the room for maneuver freely available on the motivator dimension.

This is not to say, however, that the motivators should be used as an alibi for the neglect of hygiene. If people genuinely are achieving more, taking more responsibility, and developing greater competence, that is no reason to take advantage of them for a short-term profit. Any tendency to exploitation on management's part could destroy the whole process.
Is not the best route to motivational change through participation?
Yes and no. We have to define our terms. So far as the process of job enrichment itself is concerned, experimental constraints in the studies dictated that there could be no participation by jobholders themselves in deciding what changes were to be made in their jobs. The changes nevertheless seemed to be effective. On the other hand, when people were invited to participate-not in any of the reported studies-results were disappointing. In one case, for example, a group of personnel specialists suggested fewer than 30 fairly minor changes in their jobs, whereas their managers had compiled a list of over 100 much more substantial possibilities.

It seems that employees themselves are not in a good position to test out the validity of the boundaries of their jobs. So long as the aim is not to measure experimentally the effects of job enrichment alone, there is undoubtedly benefit in the sharing of ideas. Our experience merely suggests that it would be unwise to pin too many hopes to it-or the wrong hopes.

Participation is sometimes held, consciously or unconsciously, to be an alternative to job enrichment. Instead of passing responsibility down the line and possibly losing control, the manager can consult his subordinates before making a decision, involve them, make them feel part of the team. It all seems to be a matter of degree, after all. Participation, in this sense of consultation, is seen as a safe halfway house to job enrichment, productive and satisfying to all concerned.

A multitude of techniques are available to help the manager be more effective in consultation: he can be trained to be more sensitive to interpersonal conflict, more sophisticated in his handling of groups, more ready to listen, more oriented toward valuing others' contributions. Better decisions result, especially in problem-solving meetings that bring together colleagues or opponents in different roles or functions.

But in the specific context of the management of subordinates, it is worth asking who is motivated in this kind of participation. The answer would seem to be the person who needs a second opinion to make sure he comes to the right decision-the manager in fact. The subordinate does not have the same professional or work-inspired need for the encounter, for he is not the one who has to live with responsibility for the decision. It is doubtful whether his "sense of involvement" even makes him feel good for long, for an appeal to personal vanity wears thin without more substance. However well-intentioned, this halfway-house kind of participative management smacks of conscience money; and receivers of charity are notoriously ungrateful. In the case of professional staff it is downright patronizing, for the subordinate is paid to offer his opinion anyway.

Theory clarifies the position. It is not a matter of degree at all. The difference between consultation and enrichment is a difference in kind. Consultation does not give a subordinate the chance for personal achievement which he can recognize; through involvement, it subtly denies him the exercise of responsibility which would lead to his development, however humbly, as an executive in his own right. Far from being the best route to motivational change, this kind of participation is a red herring. It is hygiene masquerading as a motivator, diverting attention from the real problem. It may help to prevent dissatisfaction, but it does not motivate.

The laboratory technicians, sales representatives, design engineers, and foremen did indeed participate, but not in a consultative exercise designed to keep them happy or to help their managers reach better decisions. Nor was it participation in ambiguity-an all too common occurrence in which, although no one quite knows where he stands or what may happen, the mere fact of participation is supposed to bring success. The participation of employees involved in the studies consisted of doing things which had always previously been done by more senior people. In all cases consultation continued, but now it was consultation upward. In consultation upward there is no ambiguity; tasks and roles are clear. Both parties are motivated, the subordinate by the need to make the best decision, to satisfy himself, to justify the trust placed in him, to enhance his professional reputation; the manager by the need to develop his staff.

When design engineers consulted their more senior colleagues, it was on questions of technical difficulty, commercial delicacy, or professional integrity-all more to the point than the mere price of a piece of equipment. Foremen consulted their managers on unusual budgetary worries, or the personnel department on tricky disciplinary problems. Sales representatives consulted headquarters on matters such as the stock position on a certain product before negotiating special terms with a customer.

Participation is indeed the best route to motivational change, but only when it is participation in the act of management, no matter at what level it takes place. And the test of the genuineness of that participation is simple-it must be left to the subordinate to be the prime mover in consultation on those topics where he carries personal responsibility. For the manager, as for the subordinate, the right to be consulted must be earned by competence in giving help. Therein lies the only authority worth having.

Expected consequences
In view of so many possible difficulties in the way, are the gains to be expected from job enrichment significant or only marginal?
We believe the gains are significant, but the evidence must speak for itself. In all, 100 people were in the experimental groups in the studies described. A conservative reckoning of the financial benefit achieved, arrived at by halving all estimated annual gains or savings, would still be over $200,000 per year. Cost was measurable in a few days of managers' time at each place.
Do the gains relate primarily to job satisfaction or to performance?
Contrary to expectation, the gains, initially at least, seem to relate primarily to performance. Wherever a direct measure of performance was possible, an immediate gain was registered. In one or two instances, performance seemed to peak and then drop back somewhat, though it stayed well above its starting point and well above the control group's performance. Elsewhere there seemed to be a more gradual improvement; if anything it gained momentum through the trial period. We have no evidence to suggest that performance gains, once firmly established, are not capable of being sustained.

In the short term, gains in job satisfaction would seem to be less spectacular. Attitudes do not change overnight. Satisfaction is the result of performance, not vice versa, and there is a long history of frustration to be overcome. When direct measurement of job satisfaction was possible, the most significant gains seemed to come when the trial period was longest. There is every reason to think that in the long term attitudes catch up with performance and that job enrichment initiates a steady and prolonged improvement in both.
What are the consequences for supervision if jobs are loaded with new tasks taken from above-i.e., does one man's enrichment become another's impoverishment?
The more subordinates' jobs are enriched, the more superfluous does supervision, in its old sense, become. Several of the studies showed that short-term absences of the experimental groups' supervisors could be coped with more easily as day-to-day concern for operational problems shifted downward. The need for the supervisor to be always "on the job" diminished; greater organizational flexibility was gained.

But though supervision may become redundant, supervisors do not. Fears of loss of authority or prestige were never realized. Far from their jobs being impoverished, supervisors now found that they had time available to do more important work. Design engineers' supervisors were able to devote more effort to technical development; production foremen's supervisors found themselves playing a fuller managerial role.

The enrichment of lower-level jobs seems to set up a chain reaction resulting in the enrichment of supervisors' jobs as well. Fears that the supervisor may somehow miss out are based on the premise that there is a finite pool of responsibility in the organization which is shared among its members. In practice new higher-order responsibilities are born.

Even when subordinates are given responsibilities not previously held by their own supervisors, as happened in the sales representatives' study and to a lesser extent in some of the others, there is no evidence that supervisors feel bypassed or deprived, except perhaps very temporarily. It soon becomes apparent to all concerned that to supervise people with authority of their own is a more demanding, rewarding, and enjoyable task than to rule over a bunch of automatons, checking their every move.
Finally, what are the consequences for management if motivational change becomes a reality? Is the manager's role affected? If so, how? And what are the implications for management development?
The main consequence is that management becomes a service, its purpose to enable, encourage, assist, and reinforce achievement by employees. Task organization and task support are the central features of the manager's new role. In task organization two complementary criteria emerge: (1) tasks have to be authentic-i.e., the more opportunity they give employees to contribute to business objectives, the more effective they are likely to be motivationally; (2) tasks have to be motivational-i.e., the more they draw upon the motivators, the more likely they are to produce an effective contribution to business objectives. In task support, factors such as company policy and administration, technical supervision, interpersonal relations, and working conditions all have to be pressed into the service of the motivators. Control of the job is achieved by providing people with the tools of their trade, with the information they require, with training as appropriate, and with advice when sought.

The job itself becomes the prime vehicle of all individual development, of which management development is only one kind. In aiding the process of development, our starting point, as always, is problem diagnosis-in this case, assessment of individual abilities, potentials, and needs. When people are underemployed, we have no way of distinguishing between those who are near the limit of their abilities and those who have a great deal more to contribute. All too often, potential has to be inferred from risky and subjective judgments about personality. Such judgments, once made, tend to be static; people become categorized. The studies show that when tasks are organized to be as authentic and motivational as possible, management receives a more accurate and a continuing feedback on individual strengths and weaknesses, ability, and potential. Task support becomes a flexible instrument of management, responsive to feedback.

If the job itself is the prime vehicle of individual development, task support is the means by which management can influence it. We still think of individual development, especially management development, far too much as something which can be imposed from outside. We pay lip service to on-the-job training but go on running courses as a refuge. We speak of self-development, but we are at a loss to know how to encourage it. Now, however, we can postulate a criterion: self-development is likely to be most effective when the task a person is engaged in is authentic and motivational and when in doing it he receives understanding, imaginative, and capable support. When these conditions are met, the job itself becomes a true learning situation, its ingredients the motivators.

Though only one study set out specifically to measure individual development, the most pervasive impression from all was one of development and personal growth achieved. The latent inspirational value of jobs appeared to have been released. People were able to demonstrate and utilize skills they already possessed, and go on to learn new ones. Each new facet of the task required a response in terms of individual development, and results suggest that that response was seldom lacking.

The best evidence of development came, however, not from the experimental groups in the studies, but from the managers who put the studies into effect. It is sometimes said that attitude change is the key to success. But in seeking to improve the performance of our business, perhaps we rely too much on efforts to change managers' attitudes. These studies went ahead without waiting for miracles of conversion first. Just as the experimental groups in the studies represented a cross section of employees engaged on those jobs, so the managers who put the studies into effect represented a cross section of managers. Enthusiasts and skeptics alike agreed to judge the studies by their results. They did, and the effect was clear for the observer to see. Success proved to be the key to attitude change. In retrospect, who would want it otherwise?

1. HBR January-February 1968, p 53.

A version of this article appeared in the March 1969 issue of Harvard Business Review.

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This article reports on five of a number of job enrichment studies which were and are still being carried out in Imperial Chemical Industries Limited and other British companies. The purpose of the studies was an attempt to shed light on important job enrichment questions dealing with(1) the generality of the findings, (2) the feasibility of making changes, and (3) the consequences to be expected.

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Motivation is something that you need your workers to have for them to be most effective, and there are lots of theories that describe why motivation arises and how to create it.

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20 Most Popular Theories of Motivation in Psychology

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There is no single motivation theory that explains all aspects of human motivation, but we look at a few theoretical explanations.

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Leadership is a set of skills and mentalities that anyone can have, and uses to inspire others to work to reach a shared goal. Not all managers are leaders, but those who are will usually find more success.

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Communication is very important in business. You need to choose an effective method for the situation that will get your message across as intended.

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The world has become smaller in recent years as communication methods in the workplace become more plentiful and far-reaching. While technology makes methods of communication more convenient and swift, if you don't choose the proper channels of communication the message can be lost. Context can be misread, as sometimes happens in a hastily written text message. A message recipient who isn't comfortable with technology might not understand how to open an email, while an account representative who needs an order expedited is not likely to wait a week for a letter to arrive in the mail.

Therefore, it's extremely important to know not only the different communication methods in the workplace, but also when to properly and effectively execute each one depending on your audience and what type of message you are trying to convey. The first step is to identify the ways to communicate business information that humans typically use every day.

Verbal Communication Methods

Verbal communication consists of the words, sounds, accents and dialects that humans use to communicate. While verbal communication has been around for millennia, and therefore may seem simple, there are many subtleties involved.

In some languages, an inflection on a particular syllable of a word can mean a completely different thing. This makes it extremely important to know what language your recipient speaks so that nothing is lost in translation.

You'll find examples of several methods of communication in this list:

Face-to-Face Communication as Verbal Communication

Face-to-face communication is the oldest communication method in business. It is a verbal method. It is also the most efficient and accurate way to get a message across. Face-to-face communication allows a message recipient to take cues from non-verbal communication such as facial expressions, body language and eye contact.

There is still no better way to instill confidence and trust in a business transaction than to look someone in the eye.

Video Conferencing as Verbal Communication

Video-messaging platforms such as Skype, GoToMeeting and Facebook Messenger are other methods of communication that have made it easier to communicate with business associates who aren't in close proximity to each other. The method requires little more than a computer, internet connection and a video camera to connect, and the number of people who can be connected in a meeting are limitless.

While video conferencing does make things easier and faster than, say, using the telephone as a communication method in the workplace, it still has its limits.

Unlike in face-to-face contact, the message recipient only sees what's on the computer screen, and while they can see facial expressions, they will not see other non-verbal cues like body language or be able to take in the entire background setting. For some people, that can be uncomfortable.

Also, video conferencing is at the mercy of technology. If someone's computer isn't working properly, or if an internet connection goes down, crucial time can be wasted in a business meeting. Even worse, a poorly executed video call filled with interruptions can give a prospective client the impression that you are not professional.

Non-Verbal Communication Methods

Non-verbal communication consists of what we don't hear when we communicate with someone. A smile, an open hand, a smirk or the wink of an eye can all mean different things. You wouldn't want to approach a prospective client with crossed arms, for instance, because that can signify that you are closed off to communication.

There are several ways that you can use non-verbal communication as a communication method in the workplace to more effectively send a message, especially if you are doing business in different countries with different customs. However, there are some things to be aware of:

Touching. Depending on the culture, touching can either be a welcoming gesture or an insult. In the United States, a handshake is considered a gesture of friendship or partnership. In some Asian cultures, two men who are friends walking down the street holding hands is considered common practice.

Gestures. Certain gestures can be used to send non-verbal messages, but they can also come off as insulting. The common "V" sign, which signifies peace in the U.S., can be quite insulting in countries such as Ireland or South Africa. A thumbs up sign in the Middle East basically means "Up yours!"

Personal space. While many European cultures tend to give each other plenty of personal space unless they are close acquaintances, business associates in countries such as Italy or the Middle East are more likely to stand closer to each other, or even give hugs as a symbol of business partnership.

Written Communication Methods

This type of communication method in business refers to the act of writing, typing or printing symbols such as letters and numbers to convey information. It can be helpful, because unlike verbal communication, written information leaves a paper trail to be used as a reference.

Written reports. This is a very common way of using written words to communicate a large amount of information to people, while also maintaining a hard copy for later reference. This is most effective for busy people who may not be good notetakers, or for multitaskers who need to go back and reread the information for clarity.

Emails. Emails have become one of the most common uses of written communication in business settings today. They are quick, instantaneous and can be received on the go. On the downside, emails can be impersonal and generally don't transmit a large amount of information.

Mobile communication. Even less formal than emails, texting and mobile messaging on platforms such as Facebook have become a quick way to get information to and from business associates. While it's definitely a speedy way to transmit information, it's not a secure way to transmit information and suffers from the lack of non-verbal information cues.

Visual Communication Methods

Visual communication is the act of using photographs, art, drawings, sketches, charts and graphs to convey information, and can often be an effective way to break up gray, boring expanses of text in reports or as a way of providing dramatic effect to help make a message clearer.

Visuals are often used as a communication method in the workplace during presentations to provide helpful context alongside written and/or verbal communication. Also, for some people with different learning styles, visual communication can be more effective in helping them understand concepts.

PowerPoint Presentations. This popular software is an easy-to-use, effective way of delivering lots of information to a group of people in a format that appeals to many people. Colorful graphics and photos can be used to demonstrate points and convey large amounts of information much more effectively than using just text.

Content Marketing Videos. Content marketing is being used by more brands as a way to attract prospects and transform prospects into customers by creating and sharing valuable free content in the form of informative videos.

Sketch Drawings. In some situations, it makes much more sense for a visual sketch to help bring across a message. How many car designers have sold the idea of a sports car to an investor using a sharp and colorful sketch of a concept? Architects start the process of building skyscrapers with a few ideas and some colored pencils, and event planners sell the idea of colorful flowers and brightly decorated halls using sketches.

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Communication Methods in Business. Choosing the best ways to communicate your messages to employees, contractors, vendors, customers and investors requires a mix of different tools and methods. Older audiences might prefer face-to-face meetings, while younger people might respond better to texts, tweets and emails. ...

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The human resources department in a company has many responsibilities to help facilitate a positive relationship between managers and employees

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discrimination in the workplace is a very serious issue. This is a link to federal regulations against various forms of it.

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Learn about the various types of discrimination prohibited by the laws enforced by EEOC. We also provide links to the relevant laws, regulations and policy guidance, and also fact sheets, Q&As, best practices, and other information.

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Learn about the various types of discrimination prohibited by the laws enforced by EEOC. We also provide links to the relevant laws, regulations and policy guidance, and also fact sheets, Q&As, best practices, and other information.

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Building a company culture is very important, but implementing one is not always easy. This article details how to communicate a company culture so that it can be realized.

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Once a week, Michael McCain, president and CEO of Maple Leaf Foods, sends a note to Maple Leaf team members. The email is essentially a candid review of McCain's weekly experiences and impressions: he talks about the company's activities, about success stories and about other industry-related news. The main point of the note however is that the examples and stories he gives, are meant to reinforce the values of the organization. It's a popular read, and often results in one-on-one interaction between those who are reading it and the CEO.

McCain's weekly email is but one example of the way in which communication is used to reinforce the organization's culture. Whether it's their quarterly town hall webcasts (which are designed to highlight the company's values and provide dialogue between management and employees), their internal social network and intranet site where employees can collaborate and connect with team members, or the Maple Leaf Foods' Leadership Academy, the key for each of these tactics is that communication is the tool used to reinforce values and behaviour. The other important factor? These communication initiatives are leadership-driven - and in the case of Maple Leaf Foods (a four-time winner of Canada's Most Admired Corporate Cultures and an inductee in our Hall of Fame), the person typically in the driver's seat is the president and CEO.

If you believe (like we do) that culture is one of the greatest assets an organization can have - and one that also impacts performance -then it makes sense that you would want to cultivate that asset. In fact, one of the best ways to ensure that it lives, grows and appreciates is through communication.
Get to Know your Culture
When we started working in and around corporate culture, our clients were saying to us: culture is difficult to understand and it's hard to put any shape to it. So how can you communicate it? Well we believe, if there's no shape to culture at a particular organization, it's because that organization hasn't yet gone through the exercise of defining the core behaviours that both represent and drive their culture.

We've been told that one of the strengths of our firm is our ability to define and articulate the culture of our clients. I think the reason we've been successful at doing so is because we'll define an organization's culture in plain language that describes behaviour: if people in a company behave independently, we'll say your organization exhibits the behaviour of independents. If it's very co-dependent, and requires a lot of cooperation, we'll use those terms and we'll give examples to back it up. Once your organization has defined its culture the next step is to determine how that culture will take shape so that you can articulate it.
Talk from the Top
Articulating your culture may be a challenging process, but once you get it you need to communicate it - a lot. What's really important though is that the leaders lead the charge. If they can do it well, and if it can be done through an employee brand - or a consumer brand if you have one - it will really help to reinforce your culture.

This can take the form of mantras, credos, rallying cries - whatever you want to call it. Sometimes the mission of the organization can represent the culture (and sometimes not), but these things all help. The key is this: when you really have the ability to communicate your culture in everything you do, and when that communication comes from the top of your organization, it becomes pervasive - and people start to truly understand what defines it.
Keep it Simple
Great organizations communicate culture well, because they keep the message simple. For instance, Four Seasons Hotels and Resorts have a guiding principle of "The Golden Rule" -do unto others as you would have done unto you. The beauty of The Golden Rule is its simplicity - easy to communicate, easy to understand and easy to use as a guide for behaviour. Employees can always ask themselves, am I following The Golden Rule? Am I treating people the way I would wish to be treated?

The Golden Rule started at the Four Seasons because they wanted to reinforce the notion that a customer focus could not survive independent of an employee - the two had to work in tandem. In fact, for them, employees attitudes were mostly going to be driven by management's attitudes and therefore the rule helped them ensure that cycle of caring and giving flowed down the waterfall from management to the employee and out to the guest. It was as simple as that.
Repeat Yourself
What's also key in communicating your culture? Repetition. Meaning, find as many opportunities as you can to reinforce your message.

Let's look at Coastal Contacts, based in Vancouver. Coastal is one of the fastest growing online retailers of contact lenses and eyeglasses. At Coastal, they really do have a culture of low ego. But more importantly, their culture is built on accessibility to the people who work there.

Because they're an online retailer - customers don't always get to meet the person handling their order. As an organization, Coastal has had to figure out how they're going to communicate their culture and their brand - how are they going to show their customers who they are and what they do. It's something they have to do constantly, and often social media is heavily involved in the process.

For instance, the company has dozens of videos posted on YouTube, featuring everything from a fun lip dub involving hundreds of their employees in all aspects of the business- to more information-driven videos, where Coastal's own people show off the latest frames, or talk about how to order online.

The point is this: Coastal is constantly communicating their culture, showing who they are, what they do and how they behave: it's fun, it's exciting, but at the same time these communication tactics show the world what they do and give people - customers - access to the organization. And why have they been successful? Because people have an expectation of what they're about; their brand is about exceptional customer service for a low price. That's their culture, and it's communicated over and over in a consistent way.
Build Links
Another great way to communicate your culture and to make it stick is to draw a link to the history of the company. A recent example is "The Schlegel Organizational Culture", an eight-page document which outlines the vision, family history, shared cultural values and expected behaviours of Schlegel Villages, 16 continuum of care campuses owned and managed by the Schlegel family of Kitchener, Ontario.

The document talks about how the Schlegels, through company founder Dr. Ronald Schlegel, have been involved in seniors' care since 1953 and demonstrates their very personal and unique perspective on long term care and retirement living. It weaves this historical information into the modern day, and talks about the continuing role of the Schlegel family in the organization, how the business has grown and more importantly - how the Schlegel's define the organization's culture.

Very few organizations create this type of 'Our Company's Culture' or 'Our Way' document, but more should. It's one of the best recent tools I've seen and if you're an organization that sees culture as an asset I would recommend creating a similar document.
Make it Measurable
Finally, organizations will have better luck communicating their culture when what they are communicating is something that's measurable. Often organizations are desperate to communicate their values. But values aren't necessarily how people act, and trying to measure against or talk about values the same way you do for behaviours is not easy. For instance, if integrity is one of your core values at your organization, how do you measure it? If someone has stolen or lied, it's perhaps do-able, but otherwise it's hard to measure integrity on a day-to-day basis. Conversely, look at the Four Seasons' The Golden Rule. Isn't it much easier to measure how your employees are caring, or how they're treating others? The Golden Rule defines an organization's culture, because it's easy to communicate and offers measurable behaviours.

One of my early bosses at Johnson and Johnson was Gary Hough. Hough was a wonderful leader and I believe no one understood culture like Hough. He was a communicator, a great story teller, and he knew how to bring a team together through shared values, great parties and wonderful mentorship. During one of our many discussions, Hough passed along a great piece of advice: anything important needs to be discussed, openly and honestly - whether it's a relationship, an asset or a goal. Culture is something that must be communicated in that way. If culture is to be developed, honed and valued it needs to be talked about often, it needs to be challenged and it needs to be lived in the organization - starting at the top.
You can read more in my book, About Marty Parker Culture Connection, where I go deeper into the topic of creating the culture conversation for your organization.
Marty Parker is chief executive officer of Waterstone Human Capital, and considered the country's leading expert on human capital. He is a frequent commentator on issues surrounding corporate leadership and organizational culture and author of "Culture Connection: How developing a winning culture will give your organization a competitive advantage".

In 2005, he founded Canada's 10 Most Admired Corporate Cultures™, an annual program that recognizes best-in-class Canadian organizations for having a culture that has helped them enhance performance and sustain a competitive advantage. In 2014, the program expanded to include Canada's Most Admired CEO™.

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Communicating Your Corporate Culture - News & Views - Waterstone Human Capital

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Once a week, Michael McCain, president and CEO of Maple Leaf Foods, sends a note to Maple Leaf team members. The email is essentially a candid review of McCain's weekly experiences and impressions: he talks about the company's activities, about success stories and about other industry-related news.

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Organizations can be organized a number of ways, depending on how they need management to work. This picture is of a matrix style organization where each low level manager has two heads.

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A decision tree can be used to see all possible outcomes in a situation

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Cognitive biases can affect decision making so knowing what they are so you can identify when you do one will improve your decision making skills

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A cognitive bias is a systematic error in thinking that occurs when people are processing and interpreting information in the world around them and affects the decisions and judgments that they make.

The human brain is powerful but subject to limitations. Cognitive biases are often a result of your brain's attempt to simplify information processing. Biases often work as rules of thumb that help you make sense of the world and reach decisions with relative speed.

Some of these biases are related to memory. The way you remember an event may be biased for a number of reasons and that, in turn, can lead to biased thinking and decision-making.

Other cognitive biases might be related to problems with attention. Since attention is a limited resource, people have to be selective about what they pay attention to in the world around them.

Because of this, subtle biases can creep in and influence the way you see and think about the world.

The concept of cognitive bias was first introduced by researchers Amos Tversky and Daniel Kahneman in 1972. Since then, researchers have described a number of different types of biases that affect decision-making in a wide range of areas including social behavior, cognition, behavioral economics, education, management, healthcare, business, and finance.

Cognitive Bias vs. Logical Fallacy

People sometimes confuse cognitive biases with logical fallacies, but the two are not the same. A logical fallacy stems from an error in a logical argument, while a cognitive bias is rooted in thought processing errors often arising from problems with memory, attention, attribution, and other mental mistakes.

Signs of Cognitive Bias

Everyone exhibits cognitive bias. It might be easier to spot in others, but it is important to know that it is something that also affects your thinking. Some signs that you might be influenced by some type of cognitive bias include:

Only paying attention to news stories that confirm your opinions

Blaming outside factors when things don't go your way

Attributing other people's success to luck, but taking personal credit for your own accomplishments

Assuming that everyone else shares your opinions or beliefs

Learning a little about a topic and then assuming you know all there is to know about it

When you are making judgments and decisions about the world around you, you like to think that you are objective, logical, and capable of taking in and evaluating all the information that is available to you. Unfortunately, these biases sometimes trip us up, leading to poor decisions and bad judgments.

Types of Cognitive Bias

Learn more about a few of the most common types of cognitive biases that can distort your thinking.

Actor-observer bias: This is the tendency to attribute your own actions to external causes while attributing other people's behaviors to internal causes. For example, you attribute your high cholesterol level to genetics while you consider others to have a high level due to poor diet and lack of exercise.

Anchoring bias: This is the tendency to rely too heavily on the very first piece of information you learn. For example, if you learn the average price for a car is a certain value, you will think any amount below that is a good deal, perhaps not searching for better deals. You can use this bias to set the expectations of others by putting the first information on the table for consideration.

Attentional bias: This is the tendency to pay attention to some things while simultaneously ignoring others. For example, when making a decision on which car to buy, you may pay attention to the look and feel of the exterior and interior, but ignore the safety record and gas mileage.

Availability heuristic: This is placing greater value on information that comes to your mind quickly. You give greater credence to this information and tend to overestimate the probability and likelihood of similar things happening in the future.

Confirmation bias: This is favoring information that conforms to your existing beliefs and discounting evidence that does not conform.

False consensus effect: This is the tendency to overestimate how much other people agree with you.

Functional fixedness: This is the tendency to see objects as only working in a particular way. For example, if you don't have a hammer, you never consider that a big wrench can also be used to drive a nail into the wall. You may think you don't need thumbtacks because you have no corkboard on which to tack things, but not consider their other uses. This could extend to people's functions, such as not realizing a personal assistant has skills to be in a leadership role.

Halo effect: Your overall impression of a person influences how you feel and think about their character. This especially applies to physical attractiveness influencing how you rate their other qualities.

Misinformation effect: This is the tendency for post-event information to interfere with the memory of the original event. It is easy to have your memory influenced by what you hear about the event from others. Knowledge of this effect has led to a mistrust of eyewitness information.

Optimism bias: This bias leads you to believe that you are less likely to suffer from misfortune and more likely to attain success than your peers.

Self-serving bias: This is the tendency to blame external forces when bad things happen and give yourself credit when good things happen. For example, when you win a poker hand it is due to your skill at reading the other players and knowing the odds, while when you lose it is due to getting dealt a poor hand.

The Dunning-Kruger effect: This is when people who believe that they are smarter and more capable than they really are. For example, when they can't recognize their own incompetence.

At times, multiple biases may play a role in influencing your decisions and thinking. For example, you might misremember an event (the misinformation effect) and assume that everyone else shares that same memory of what happened (the false consensus effect).

Causes of Bias

If you had to think about every possible option when making a decision, it would take a lot of time to make even the simplest choice. Because of the sheer complexity of the world around you and the amount of information in the environment, it is necessary sometimes to rely on some mental shortcuts that allow you to act quickly.

Cognitive biases can be caused by a number of different things, but it is these mental shortcuts, known as heuristics, that often play a major contributing role. While they can often be surprisingly accurate, they can also lead to errors in thinking.

Other factors that can also contribute to these biases:

Emotions

Individual motivations

Limits on the mind's ability to process information

Social pressures

Cognitive bias may also increase as people get older due to decreased cognitive flexibility.﻿﻿

Impact of Cognitive Bias

Cognitive biases can lead to distorted thinking. Conspiracy theory beliefs, for example, are often influenced by a variety of biases.﻿﻿ But cognitive biases are not necessarily all bad. Psychologists believe that many of these biases serve an adaptive purpose: They allow us to reach decisions quickly. This can be vital if we are facing a dangerous or threatening situation.

For example, if you are walking down a dark alley and spot a dark shadow that seems to be following you, a cognitive bias might lead you to assume that it is a mugger and that you need to exit the alley as quickly as possible. The dark shadow may have simply been caused by a flag waving in the breeze, but relying on mental shortcuts can often get you out of the way of danger in situations where decisions need to be made quickly.

Tips for Overcoming Bias

Research suggests that cognitive training can help minimize cognitive biases in thinking.﻿﻿ Some things that you can do to help overcome biases that might influence your thinking and decision-making include:

Being aware of bias:Consider how biases might influence your thinking. In one study, researchers provided feedback and information that help participants understand these biases and how they influence decisions. The results of the study indicated that this type of training could effectively reduce the effects of cognitive bias by 29%.﻿﻿

Considering the factors that influence your decisions: Are there factors such as overconfidence or self-interest at play? Thinking about the influences on your decisions may help you make better choices.

Challenging your biases: If you notice that there are factors influencing your choices, focus on actively challenging your biases. What are some factors you have missed? Are you giving too much weight to certain factors? Are you ignoring relevant information because it doesn't support your view? Thinking about these things and challenging your biases can make you a more critical thinker.

Reducing cognitive bias may also be beneficial in the treatment of some mental health conditions.﻿﻿ Cognitive bias modification therapy (CBMT) is a treatment approach based on processes that are designed to reduce cognitive bias. This form of therapy has been used to help treat addictions, depression, and anxiety.

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How Cognitive Biases Influence How You Think and Act

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Cognitive biases influence how we think and can lead to errors in decisions and judgments. Learn the common ones, how they work, and their impact.

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As you start and grow a business it is important to spend time thinking about your business strategy. Think of the business strategy as your map - with it, you'll determine the direction of your business and what you want it to look like in the future.

By clearly defining the strategy, you'll have the guidelines and structure to develop your business or growth plan and achieve your business goals.

Remember, you cannot be all things to all customers. You do not have to be the market leader to compete successfully, but you do need to focus on your company's strengths to find a way to differentiate from other competitors.

DEFINING YOUR BUSINESS STRATEGY

Once defined, your business strategy sets priorities for the company and management team and helps you attract and retain the talented workers you need.

Although individuals in your company may focus on different priorities to accomplish specific tasks, these priorities should not conflict with the overall strategic direction of the company.

Your business strategy can be defined in either several paragraphs or be written as a set of strategic statements. It is a summary of how the company will achieve its goals, meet the expectations of its customers and sustain a competitive advantage in the marketplace.

Your business strategy should answer these questions:

Why is the company in business?

What is our core strength?

Which customers should we continue to serve or start serving?

Which products/services should we stop offering, continue to offer or start offering?

Why have we decided on these strategic directions?

Answering these questions will help you establish your strategic priorities. After all, you can't be all things to all customers - nor should you be!

You don't have to be the market leader to successfully compete, but you do need to focus on your company's strengths to differentiate your business from the competition and help customers understand the value you offer, including features and benefits.

Let's dig into two examples that not only showcase a business strategy in action, but also highlight the difference between a business strategy and business goals. In continuing with the "business strategy as a map" analogy, goals are the journey - in other words, how you'll follow the map to reach a destination. If you want to prioritize these two elements, it's often easier to develop your strategy first, then outline the goals that will help you achieve that strategy.

EXAMPLE 1: PINNACLE PERFORMANCE GROUP

Pinnacle Performance Group is a consulting company that provides performance improvement strategies, assessments and training programs to mid-sized businesses.

Pinnacle has successfully worked with a variety of service businesses on an innovative client retention process. Some of the most positive feedback has come from accounting firms and financial planners who have used these services.

Like many consulting companies, Pinnacle's current revenues are tied to the number of hours the consultants can work, and the majority of its clients are located in a four-state area.

The Pinnacle team wants to grow the business. After conducting a SWOT analysis and brainstorming their three-year vision, they developed the following strategy and goals to accomplish them.

STRATEGY

Pinnacle Performance Group will offer performance improvement strategies, assessments, training programs and tools to help mid-sized businesses build sustainable futures, increase productivity, and develop staff and customer loyalty.

In addition to continuing its regional consulting services, Pinnacle will:

Develop a software program based on Pinnacle's successful client retention process.

Create a turnkey training program that can be used to help potential customers achieve the greatest benefits from the client retention software.

Broaden Pinnacle's distribution activities to market the new client retention software and training program to mid-sized accounting firms and financial planners nationwide.

Implement a marketing plan to position Pinnacle as the expert in client retention for accountants and financial planners.

GOALS

Enhance the value of the Pinnacle Performance Group brand.

Develop a revenue stream independent of consulting time that will provide 50 percent of Pinnacle's sales revenue within three years.

Increase the assets of the business so that in the next five years, Pinnacle could be sold to another company or individual.

EXAMPLE 2: O-FOODS

O-Foods offers a line of organic foods that range from cereal and soups to cheese and chicken. These products are currently sold at three company stores, and those products that can be easily shipped are also sold through the O-Foods website. In addition to the O-Foods branded products, they also carry other organic products.

Each of the company stores is located in a town with a major university; both students and working adults interested in a healthy lifestyle are their target customers. O-Foods attracts and retains a talented staff that provides product information along with a high level of service to its customers - creating a strong competitive advantage.

The following strategy and goals were developed based on their SWOT analysis and three-year vision.

STRATEGY

O-Foods will provide its customers with the freshest and finest organic food available. O-Foods' team ensures each customer has an outstanding shopping experience by providing a high level of service and product information. O-Foods will:

Implement an employee stock ownership program for those employees who have worked for the business for a minimum of one year.

Develop an employee training program to further enhance all employees' product knowledge and customer service skills.

Create a unified look for the stores, the website and the product packaging.

Design a marketing plan to increase purchases by current customers and attract new customers within the existing target markets.

Increase operational efficiencies.

Improve shipping capability so that perishable products can be ordered from the website and shipped anywhere in the United States.

GOALS

Develop incentives to maintain high employee retention with a turnover rate of less than 20 percent annually for those at or above the assistant manager level and less than 30 percent for all other employees.

Build the O-Foods brand.

Increase profits by 15 percent each year for the next three years.

READY TO BUILD YOUR OWN BUSINESS STRATEGY BUT NEED MORE HELP GETTING STARTED? REGISTER FOR KAUFFMAN FASTTRAC AND GET THE INSIGHT AND RESOURCES YOU NEED TO START OR GROW YOUR COMPANY.

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As you start and grow a business it is important to spend time thinking about your business strategy. Think of the business strategy as your map - with it, you'll determine the direction of your business and what you want it to look like in the future.

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The planning cycle describes the continuous cycle of different activities involved in planning. Planning is essential in business because it establishes goals and describes steps to achieve them.

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Different strategic approaches to global business

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Global supply chains involve acquiring resources, assembling them, and selling them, all in different areas of the globe. This is an effect of globalization and is beneficial for corporations by lowering costs.

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Different aspects of foreign cultures affect how you can most successfully conduct business there

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Are you looking to enter the global marketplace? Do you have an understanding of cultural differences in business and how they can affect your efforts? In the wake of the COVID-19 pandemic, our world and the way we do business have undergone some significant changes. Now, more than ever, organizations need to harness the power of global markets, but it is also vital for them to understand the essential role that culture plays.

Cultural differences can affect consumer behavior, ultimately placing a brand's opportunities at global success in the hands of their efforts to bridge cultural barriers between local and foreign markets.

Cross-Cultural Challenges

As you learn more about cultural differences in business, you will encounter several more concepts, such as low-context and high-context cultures. In low-context cultures like the United Kingdom, the United States, and Canada, communication is explicit and clear. In contrast, in a high-context culture like Russia, communication is nuanced and implicit, and there is more shared content. However, the opposite happens when negative feedback is to be given. Russia becomes direct, while low-context cultures tend to be indirect when negative feedback is called for.

Building trust is another challenge for businesses. The concept may be relationship-based or task-based. When doing business in China , for example, one of the ways to build good relationships involves spending time together at the dining table (drinking and eating). It is akin to building a solid network where gaining trust opens a path to success as cultural differences are set aside. The Chinese call this type of relationship 'guanxi.' In the United States, however, people don't often socialize with potential business partners unless necessary to avoid embarrassing situations.

Another factor that affects trust-building is the comfort of silence. In some countries, a few seconds of silence make the conversation uncomfortable. This happens in countries where the comfort of silence is low, such as France, Italy, and the United States. In Asian countries like Korea, Indonesia, and Japan, however, the comfort of silence is high, which often results in Asians not speaking often during business meetings with people from Western countries. Asians are not likely to feel uncomfortable if the conversation stops for as long as 30 seconds.

Business executives should learn that cultural sensitivity is essential when engaging in cross-cultural business. Never look at cultural differences as weaknesses. Instead, respect cultural differences to gain success.

Understanding Cultural Differences in Business

Accepting cultural differences provides you with a wide range of business expertise and gives you novel business insights to overcome business-related problems. It's your way to cope with potential barriers regarding international business and culture.

A global company needs to understand that there is a difference in the definition of culture per se and culture in relation to international business. Culture is typically defined as a group of ordinary and accepted standards shared by a specific society. When you put it in a global business context, what one society considers professional may be different for another foreign society.

You must understand that cultural differences affect global business in three primary areas - organizational hierarchy, etiquette, and communication. Understanding them and recognizing their effects on your business will prevent you from creating misunderstandings with foreign clients and colleagues.

By implementing lean processes effectively in your workplace, you can better observe your staff and see any inefficiencies in their communication styles. From there, you can create a step-by-step process that explains to your team how to effectively and productively speak to each other based on cultural differences. This will help you reach your desired output faster, whether that's bridging cultural gaps or improving production tasks.

Communication

Effective communication is vital to business success, whether you are a start-up or a big corporation. Although it is common to hear that English is the language of business, it's never wise to assume that your global business partners will all understand English.

When you venture into the international business arena, one way of bridging cultural differences is through language. Understand the language your target market speaks and know how you use it to convey your message. In India, for example, business professionals typically communicate in nuanced and indirect ways. This is opposite to the Finns, who tend to be direct and brief in their communication.

Aside from verbal communication, it is essential to learn that non-verbal communication is also critical when dealing with international businesses.

Interactions

Gestures that are commonplace in your own country, like kissing people you meet on the cheek, making eye contact, and shaking hands firmly, may be taken as offensive or unusual by your foreign clients or business partners. As many business coaches will tell you, you must remember the proper professional interactions when dealing with different cultures. Researching accepted and proper business etiquette is essential. In some cases, you need to be extra observant of body language, and at times, it is better to ask than commit a cultural faux pas .

Workplace Etiquette

When you are working for a multinational company, you are likely to encounter many differences, which prompt you to learn international business etiquette.

Pay special attention to the formality of address when dealing with foreign business partners and multicultural teams. In some cultures, it is acceptable to address a person you've recently met by their first name, while in other countries, they would instead that you address them by their surname or their title. Canadians and Americans often use first names, even when dealing with new acquaintances. But in many Asian countries, such as Singapore, China, and South Korea, you should always address a person formally by adding Mr. or Ms. before their surname. If you are in doubt, use the formal way of address.

Punctuality is relative. When you deal with business partners, clients, or colleagues from the United States, South Korea, Japan, and Russia, you are expected to be on time. In Germany, you are even expected to be at least 10 minutes early for your appointment. In Greece, they expect foreigners to arrive on time, but just like in Russia, you may expect your counterpart to arrive slightly late. Brazil is ambivalent. They could either be late by a few or several minutes unless you indicate that they should follow the English time, meaning they should arrive at the agreed time.

In Malaysia, expect to wait up to an hour if your counterpart stated that they would be about five minutes late. They are not required to explain either. In China, it is acceptable to be at least 10 minutes late, while in Mexico, it is pretty normal for people to be late by 30 minutes for a business meeting. When doing business in Nigeria or Ghana, the appointed hour for the meeting may be one hour late or within the day. In Morocco, personal meetings could be delayed by an hour and, in some cases, a day. When scheduling meetings in India, understand that being punctual is not one of their ways.

Organizational Hierarchy

Cultural norms dictate how attitudes towards management and organizational hierarchy are perceived. In some cultures, junior staff and middle management may or may not be allowed to speak up during meetings. In some countries, it is challenging to question decisions by senior officers or express opinions that are different from the rest.

Attitudes are dependent on social equality or the societal values of a country. In some countries such as Japan and South Korea, where respect for elders and people in positions of authority is deeply ingrained in the members of society, the concept is applied to the workplace as well. It helps define responsibilities and roles in the company, and those holding positions in senior management expect deference from junior staff and a higher level of formality and respect.

However, the situation is different in Scandinavian countries. In Norway, for example, societal equality is emphasized, so the organizational hierarchy tends to be flat. The workplace environment calls for cooperation across all departments, and informal communication is prevalent.

Differences in Negotiation Styles

Negotiation is a principal component of international business. Culture influences the way people behave, communicate, and think. These characteristics are reflected in the way they negotiate. Companies must understand cultural differences during business transactions and find ways to hurdle the barriers these differences present.

Spanish speakers view negotiation as the means to have a contract, while in some Asian countries, negotiations help build firmer business relationships. The Japanese regard negotiation as a win-win process while the Spanish look at it as a win-lose process.

The way one communicates during negotiations should be carefully considered. Israelis and Americas are very direct, so you immediately know if the transaction is approved or not. The Japanese, however, tend to be indirect. You have to read and carefully interpret vague signs to see if they rejected or accepted your proposal.

Even the way different cultures handle contracts varies. Americans like to have every detail included in the contract because they want to anticipate possible eventualities and circumstances. The deal equates to an agreement. Therefore everything that was discussed and accepted during the negotiation should be specified in the contract. The Chinese, on the other hand, prefer a contract to have the general principles only because, for them, sealing a deal means forming a relationship with the business partner.

Remain Competitive and Successful in the Global Marketplace

Cultural differences are sensitive issues, and those who take the time to address these differences will have a better chance of remaining competitive and thriving in the international business environment.

Businesses preparing to enter the global market have to diligently learn how cultural differences can affect their business conduct in different markets. Their performance depends on understanding cultural diversity and that different markets have their own set of priorities, preferences, and expectations. . can help you navigate the complexities of cultural differences through Day Translations, Inc localization.

Our translators live in-country; thus, they have insider knowledge of specific cultures. They are also native speakers, assuring you that every nuance of the language is appropriately incorporated in the localization process. We share our comprehensive experience and long-term expertise in translation and localization to ensure that your business can genuinely respond to the needs of your target markets. For your translation and localization requirements, you can or call us at 1-800-969-6853 anytime night or day. We are open 24 hours a day, every day of the year, to quickly respond to your linguistic needs.

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Why Cultural Differences in Business Matter Business

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Organizations entering the global market should understand that cultural differences in business matter. Here's how to adapt.

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Most businesses have a sustainability plan that describes steps to minimize their environmental impact

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official ethics laws and guidelines

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The Principles of Ethical Conduct were established by Executive Order 12674, modified by Executive Order 12731, as basic principles regarding the conduct of federal employees. It is important that federal employees observe these principles in order to promote confidence in the integrity of the federal government.

United States Code, Title 18 contains the criminal conflict of interest statutes applicable to employees in the executive branch of the government. Included in Title 18 is a prohibition against solicitation or receipt of bribes; a prohibition against acting as an agent or attorney before the government; post-employment restrictions; a prohibition against participating in matters affecting personal financial interest; and a prohibition against receiving supplementation of salary as compensation for government service.

Standards of Ethical Conduct for Employees of the Executive Branch
The Standards were developed by the Office of Government Ethics and set forth the basic obligation of public service. The standards contain regulations regarding matters such as conflicting financial interests, impartiality in performing official duties, and misuse of position.

HHS Supplemental Standards of Ethical Conduct
On February 3, 2005, The Department of Health and Human Services (HHS) amended the Supplemental Standards of Ethical Conduct ( 5 CFR 5501) and Supplemental Financial Disclosure Requirements section ( 5 CFR 5502), both effective on that date. On August 31, 2005, HHS published the Final Rule for both sections.

Department of Health and Human Services--Standards of Conduct
These regulations were superceded in 1992 by the Office of Government Ethics "Standards of Ethical Conduct for Employees of the Executive Branch." However, certain portions of the HHS Standards of Conduct remain applicable. This link contains the remaining relevant portions of 45 CFR Part 73.

Related Links

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links and descriptions of ethics laws and regulations applicable to FD

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The Principles of Ethical Conduct were established by Executive Order 12674, modified by Executive Order 12731, as basic principles regarding the conduct of federal employees. It is important that federal employees observe these principles in order to promote confidence in the integrity of the federal government.

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Corporate social responsibility describes how corporations should leave an impact on the world. Whether they help the environment or their community, businesses should aim to make a positive difference.

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What is corporate social responsibility?

Corporate social responsibility is a type of business self-regulation with the aim of social accountability and making a positive impact on society. Some ways that a company can embrace CSR include being environmentally friendly and eco-conscious; promoting equality, diversity, and inclusion in the workplace; treating employees with respect; giving back to the community; and ensuring business decisions are ethical.

CSR evolved from the voluntary choices of individual companies to mandatory regulations at regional, national and international levels. However, many companies choose to go beyond the legal requirements and embed the idea of "doing good" into their business models.

There is no one way a company can embrace CSR, but one thing is certain - to be perceived as genuine, the company's practices need to be integrated into its culture and business operations. In today's socially conscious environment, employees and customers place a premium on working for and spending their money on businesses that prioritize CSR. They can detect corporate hypocrisy.

To ensure CSR authenticity, a company should look at its values, business mission and core issues and determine which initiatives best align with the business's goals and culture. The business can do this internally or hire a third party to conduct an assessment.

Reviewing the United Nations 17 Sustainable Development Goals is a good place to start. While goals like Good Health and Well-Being or Gender Equality can apply to most businesses, specific goals like Life Below Water or Affordable and Clean Energy may be relevant to select industries like water technology or energy providers.

Why CSR is important

There are many reasons for a company to embrace CSR practices.

1. It improves customers' perception of your brand.

It's increasingly important for companies to have a socially conscious image. Consumers, employees, and stakeholders prioritize CSR when choosing a brand or company, and they hold corporations accountable for effecting social change with their beliefs, practices, and profits.

"What the public thinks of your company is critical to its success," said Katie Schmidt, founder and lead designer of Passion Lilie. "By building a positive image that you believe in, you can make a name for your company as being socially conscious."

To stand out among the competition, your company needs to prove to the public that it is a force for good. Advocating and raising awareness for socially important causes is an excellent way for your business to stay top-of-mind and increase brand value.

The Kantar Purpose 2020 study demonstrated a direct correlation between perceived positive impact and brand value growth. Companies that the public considers highly impactful demonstrated a brand value growth of 175% over 12 years, while businesses with a low positive impact showed only 70% growth.

Schmidt also said that sustainable development could help a business financially. For example, using less packaging and less energy can reduce production costs.

2. It attracts and retains employees.

Consumers aren't the only ones drawn to businesses that give back. Susan Cooney, head of global diversity and inclusion at Symantec, said that sustainability strategy is a big factor in where today's top talent chooses to work.

"The next generation of employees is seeking out employers that are focused on the triple bottom line: people, planet and revenue," she said. "Coming out of the recession, corporate revenue has been getting stronger. Companies are encouraged to put that increased profit into programs that give back."

According to Deloitte's 2021 Millennial and Gen Z Survey, the modern workforce prioritizes culture, diversity, and high impact over financial benefits. An estimated 44% of millennials and 49% of Gen Zers rely on their personal ethics in determining the type of work and companies they'd join. The respondents of the Porter Novelli Purpose Tracker 2021 report go even further, with 70% saying they wouldn't work for a company without a strong purpose.

What's more, employees that share the company's values and can relate to its CSR initiatives are much more likely to stay. Deloitte's 2020 Global Marketing Trends Report shows that purpose-driven companies retain talent up to 40% more than their competitors. Considering that the estimated cost of losing an employee averages 40% of their annual salary, according to a report by the Washington Center for Equitable Growth, offering your team a sense of purpose and meaning in their work is worth the effort.

3. It increases your appeal to investors.

By demonstrating a developed CSR program and initiatives, your company is bound to become more appealing to both current and future investors. CECP's influential 2021 Giving in Numbers report shows that investors play a growing role as key stakeholders in corporate social responsibility. Almost 80% of surveyed businesses were open to providing them with data and considering their perspectives on sustainability. Just like customers, investors are holding businesses accountable when it comes to social responsibility.

At the same time, a company that takes CSR seriously signals to both investors and partners that it's interested in long-term as well as short-term gain. CSR goes hand in hand with environmental, social, and governance (ESG) metrics that help external analysts quantify the company's social efforts, and becomes a key factor for investors' consideration and continued interest.

4 types of corporate responsibility your business can practice

In recognition of how important socially responsible efforts are to their customers, employees and stakeholders, many companies focus on four broad CSR categories.

1. Environmental efforts: One primary focus of CSR is the environment. Businesses have large carbon footprints, regardless of size. Any steps a company can take to reduce its footprint is considered good for both the company and society.

2. Philanthropy: Businesses can practice social responsibility by donating money, products or services to social causes and nonprofits. Larger companies tend to have plentiful resources that can benefit charities and local community programs; however, even as a small business, your efforts can make a difference. If you have a specific charity or program in mind, reach out to the organization. Ask them about their specific needs and whether a donation of money, time or your company's products would best help them.

3. Ethical labor practices: Companies can demonstrate CSR by treating employees fairly and ethically. This is especially true of businesses that operate in international locations with labor laws that differ from those in the U. S.

4. Volunteering: Participating in local causes or volunteering your time (and your staff's time) to community events says a lot about your company's sincerity. When your company does good deeds without expecting anything in return, you express concern (and support) for specific issues and social causes.

Building a socially responsible business

While startups and small companies don't have the deep financial pockets that enterprises have, their efforts can have a significant impact, especially in their local communities.

"Even 5%, though it might not sound like a lot, can add up to make a difference," Schmidt said. "When thinking of ways to donate and give back, start local, and then move from there."

When identifying and launching a CSR initiative, involve your employees in the decision-making process. Create an internal team to spearhead the efforts and identify organizations or causes related to your business or that employees feel strongly about. You'll increase engagement and success when you contribute to something that matters to your employees. Involving your employees in the decision-making process can also bring clarity and assurance to your team.

"If decisions [about CSR] are made behind closed doors, people will wonder if there are strings attached and if the donations are really going where they say," Cooney said. " Engage your employees [and consumers] in giving back. Let them feel like they have a voice."

Whichever strategies you use for sustainable development, be vocal. Let your consumers know what you are doing to be socially conscious. [Related read: PayPal's Mission for Corporate Social Responsibility]

"Consumers deserve to share in the good feelings associated with doing the right thing, and many surveys have found that consumers are inclined to purchase a sustainable product over a conventional alternative," Cooney said. "Announcing these benefits is a win-win from both a commercial and sustainability perspective."

What to avoid when creating a socially responsible business model

Becoming a socially responsible business can be simple, but there are a few caveats.

1. Don't choose unrelated initiatives.

Avoid participating in charitable efforts that are not related to your core business focus or that violate your company's ethical standards in any way. Instead of blindly sending money to a completely unrelated organization, find a nonprofit that your company believes in or invest in a project in your community.

2. Don't use CSR as a marketing scheme.

Don't use CSR opportunities solely for marketing purposes. Schmidt said running a corporate responsibility campaign as a quick marketing scheme can backfire if your business doesn't follow through. Instead of trying a one-time stunt, adopt socially responsible business practices over time. Schmidt said employees and consumers react positively to companies that embrace long-term social responsibility.

3. Don't wait for the industry to catch up.

If you are considering sustainable activities that aren't legally required yet, don't wait. By adopting socially responsible norms early on, you set the bar for your industry and refine your process. [Related read: 14 Examples of Socially Responsible Businesses]

Undertaking CSR initiatives is a win for everyone involved. The impact of your actions will not only appeal to socially conscious consumers and employees, but can also make a real difference in the world.

CSR certifications

While many companies self-assess their CSR efforts, often the most practical and trusted way to prove your company's social accountability to the public is to undergo a third-party social impact assessment.

These three corporate social responsibility certifications can help you achieve public recognition for your sustainability and CSR efforts.

B-corp certification

Certified B corporations, or B-corps, are companies verified by B Lab to meet high standards of social and environmental performance, accountability, and transparency. To become a B-corp, a company must undergo a rigorous and holistic verification process every three years, integrate B-corp commitments to all stakeholders (rather than only shareholders) into its governing documents, and pay a sales-based annual fee.

While B-corp status is mainly associated with multinationals like Patagonia or Ben & Jerry's, small businesses and startups that strive for social and environmental excellence can also receive this CSR certification. The first step is to complete the free and confidential B Impact Assessment on the B Lab website and receive a minimum score of 80. If you meet the baseline, you can submit the impact assessment for review and start the verification process.

ISEAL code compliance

ISEAL Alliance is a global membership organization for credible sustainability standards whose members include Fairtrade International, Gold Standard, Alliance for Water Stewardship and more. An assessment from ISEAL is carried out by an independent third-party verification provider that determines whether a business meets Codes of Good Practice and can be deemed ISEAL Code Compliant. This assessment offers a reputable seal of approval for companies that emphasize sustainability.

In some circumstances, verifications from ISEAL members can directly impact business continuity. For example, the absence of a certification from the Roundtable for Sustainable Palm Oil can effectively close down a supply chain for some consumer brands.

SASB standards

The Sustainability Accounting Standards Board is one of the most established environmental, social, and governance (ESG) guidance frameworks, providing standards for disclosing the financial impact of a company's sustainability efforts. In other words, it allows businesses to communicate the financial outcomes of their CSR and ESG measures to investors and other stakeholders.

SASB Standards are evidence-based, cost-effective, market-informed, and industry-specific, covering 77 industries. These standards help produce structured, comparable, and standardized data that is perfect for both internal and external communications of CSR and ESG impacts.

Examples of CSR companies

If you're looking for CSR inspiration for your business, here are six companies practicing corporate social responsibility on a large scale.

LEGO: The toy company has invested millions of dollars into addressing climate change and reducing waste. LEGO's environmentally conscious efforts include reduced packaging, sustainable materials, and investments in alternative energy.

TOMS: TOMS donates one-third of its net profits to charities that support physical and mental health as well as educational opportunities. During the pandemic, the brand directed all charitable donations to the TOMS COVID-19 Global Giving Fund.

Johnson & Johnson: The brand Johnson & Johnson focuses on reducing its environmental impact by investing in alternative energy sources. Globally, Johnson & Johnson also works to provide clean, safe water to communities.

Starbucks: The global coffee chain has implemented a socially responsible hiring process to diversify its workforce. Its efforts are focused on hiring more veterans, young people looking to start their careers, and refugees.

Google: Google has demonstrated its commitment to the environment by investing in renewable energy sources and sustainable offices. CEO Sundar Pichai is also known to take stands on certain social issues.

Pfizer: The pharmaceutical company's focus on corporate citizenship is reflected in its healthcare initiatives, which include spreading awareness about non-infectious diseases and providing accessible health services to women and children in need.

Corporate social responsibility FAQs

Corporate social responsibility is a modern approach to running a business. Here are some of the most frequently asked questions about it.

What is corporate social responsibility (CSR)?

Corporate social responsibility is a way of describing how companies measure and control their impact on society. This includes a company's contributions - both positive and negative - to the economy, environment and greater community.

Who is CSR for?

Businesses of all sizes can choose to introduce a comprehensive CSR program or selected initiatives and reap the associated benefits. No matter the size or maturity of your business, an investment in ethical behavior and sustainable practices can improve your brand value, build customer trust, grow your company, and improve the bottom line.

What are the benefits of CSR for companies?

CSR can be beneficial to a company in several ways. The first is by improving its brand image. When customers or clients see evidence that a business is socially responsible, they tend to respond positively.

The second benefit is improving employee morale. Morale tends to be higher at companies that invest effort and resources into ethical and socially responsible behavior.

The third involves appealing to new talent. Modern employees often choose purpose-driven and environmentally conscious companies over financial benefits.

Lastly, CSR-active companies attract investors and partners. A company that is willing to invest in long-term policies and improvements offers security to potential investors.

What are examples of CSR initiatives?

Some examples of CSR components are reducing carbon footprint and energy consumption, engaging in wildlife conservation initiatives, encouraging charity and volunteer work, supporting local communities, improving labor policies, ensuring diversity and equality in the workplace, investing in nonprofit organizations, and guaranteeing ethically sourced materials.

Whichever practices you employ, make sure they are authentic and match your corporate values. Otherwise, your business might be accused of greenwashing.

How do you monitor CSR?

There are a few key ways to measure CSR. The first is to break CSR goals into categories, such as philanthropy, labor practices, and environmental efforts.

To track the success of these investments, look for measurable key performance indicators. How much has your company's carbon footprint changed? How many people did you reach with a charitable effort? Monitor new developments and keep a pulse on general public perception of issues associated with your company's social causes.
Skye Schooley, Nicole Fallon and Sammi Caramela contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article.

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What Is Corporate Social Responsibility (CSR)?

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Corporate social responsibility is imperative for businesses that want to appeal to modern consumers. Learn what it is and how to maintain it.

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Managerial skills

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What are Management Skills?

Management skills can be defined as certain attributes or abilities that an executive should possess in order to fulfill specific tasks in an organization. They include the capacity to perform executive duties in an organization Corporate Structure while avoiding crisis situations and promptly solving problems when they occur. Management skills can be developed through and practical experience as a manager. The skills help the manager to relate with their fellow co-workers and know how to deal well with their subordinates, which allows for the easy flow of activities in the organization.

Good management skills are vital for any organization to succeed and achieve its goals and objectives. A manager who fosters good management skills is able to propel the company's mission and or business goals forward with fewer hurdles and objections from internal and external sources.

Management and leadership skills are often used interchangeably as they both involve planning, decision-making, problem-solving, communication, delegation, and . Good managers are almost always good leaders as well.

In addition to leading, a critical role of a manager is to also ensure that all parts of the organization are functioning cohesively. Without such integration, several issues can arise and failure is bound to happen. Management skills are crucial for various positions and at different levels of a company, from top leadership to intermediate supervisors to first-level managers.

Types of Management Skills

According to American social and organizational psychologist Robert Katz, the three basic types of management skills include:

1. Technical Skills

Technical skills involve skills that give the managers the ability and the knowledge to use a variety of techniques to achieve their objectives. These skills not only involve operating machines and software, production tools, and pieces of equipment but also the skills needed to boost sales, design different types of products and services, and market the services and the products.

2. Conceptual Skills

These involve the skills managers present in terms of the knowledge and ability for abstract thinking and formulating ideas. The manager is able to see an entire concept, analyze and diagnose a problem, and find creative solutions. This helps the manager to effectively predict hurdles their department or the business as a whole may face.

3. Human or Interpersonal Skills

The human or the interpersonal skills are the skills that present the managers' ability to interact, work or relate effectively with people. These skills enable the managers to make use of human potential in the company and motivate the employees for better results.

Examples of Management Skills

There is a wide range of skills that management should possess to run an organization effectively and efficiently. The following are six essential management skills that any manager ought to possess for them to perform their duties:

1. Planning

Planning is a vital aspect within an organization. It refers to one's ability to organize activities in line with set guidelines while still remaining within the limits of the available resources such as time, money, and labor. It is also the process of formulating a set of actions or one or more strategies to pursue and achieve certain goals or objectives with the available resources.

The planning process includes identifying and setting achievable goals, developing necessary strategies, and outlining the tasks and schedules on how to achieve the set goals. Without a good plan, little can be achieved.

2. Communication

Possessing great communication skills is crucial for a manager. It can determine how well information is shared throughout a team, ensuring that the group acts as a unified workforce. How well a manager communicates with the rest of his/her team also determines how well outlined procedures can be followed, how well the tasks and activities can be completed, and thus, how successful an organization will be.

Communication involves the flow of information within the organization, whether formal or informal, verbal or written, vertical or horizontal, and it facilitates smooth functioning of the organization. Clearly established communication channels in an organization allow the manager to collaborate with the team, prevent conflicts, and resolve issues as they arise. A manager with good communication skills can relate well with the employees and thus, be able to achieve the company's set goals and objectives easily.

3. Decision-making

Another vital management skill is decision-making. Managers make numerous decisions, whether knowingly or not, and making decisions is a key component in a manager's success. Making proper and right decisions results in the success of the organization, while poor or bad decisions may lead to failure or poor performance.

For the organization to run effectively and smoothly, clear and right decisions should be made. A manager must be accountable for every decision that they make and also be willing to take responsibility for the results of their decisions. A good manager needs to possess great decision-making skills, as it often dictates his/her success in achieving organizational objectives.

4. Delegation

Delegation is another key management skill. Delegation is the act of passing on work-related tasks and/or authorities to other employees or subordinates. It involves the process of allowing your tasks or those of your employees to be reassigned or reallocated to other employees depending on current workloads. A manager with good delegation skills is able to effectively and efficiently reassign tasks and give authority to the right employees. When delegation is carried out effectively, it helps facilitate efficient task completion.

Delegation helps the manager to avoid wastage of time, optimizes productivity, and ensures responsibility and accountability on the part of employees. Every manager must have good delegation abilities to achieve optimal results and accomplish the required productivity results.

5. Problem-solving

Problem-solving is another essential skill. A good manager must have the ability to tackle and solve the frequent problems that can arise in a typical workday. Problem-solving in management involves identifying a certain problem or situation and then finding the best way to handle the problem and get the best solution. It is the ability to sort things out even when the prevailing conditions are not right. When it is clear that a manager has great problem-solving skills, it differentiates him/her from the rest of the team and gives subordinates confidence in his/her managerial skills.

6. Motivating

The ability to motivate is another important skill in an organization. Motivation helps bring forth a desired behavior or response from the employees or certain stakeholders. There are numerous motivation tactics that managers can use, and choosing the right ones can depend on characteristics such as company and team culture, team personalities, and more. There are two primary types of motivation that a manager can use. These are intrinsic and extrinsic motivation.

Bottom Line

Management skills are a collection of abilities that include things such as business planning, decision-making, problem-solving, communication, delegation, and time management. While different roles and organizations require the use of various skill sets, management skills help a professional stand out and excel no matter what their level. In top management, these skills are essential to run an organization well and achieve desired business objectives.

Additional Resources

Thank you for reading CFI's guide to management skills. CFI is a leading provider of for finance professionals. To continue learning and advancing your career, the additional resources below will be helpful:

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Management Skills - Types and Examples of Management Skills

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Management skills can be defined as certain attributes or abilities that an executive should possess in order to fulfill specific tasks in an organization. They include the capacity to perform executive duties in an organization Corporate Structure while avoiding crisis situations and promptly solving problems when they occur.

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Vertical management rankings

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Hi my name is Zack Graves I am 20 years old and I am from Jacksonville FL. It should be noted that I will be a junior at Florida Tech in the fall. My major is Oceanography, I recently changed from engineering. This summer the tempo of my life has slowed due to lockdown, but I am excited to start this class. I have been on pause for too long and I am ready to start working again. I think that this course will be instrumental to my success in the future, not only is it required to graduate, but the skills I learn from it will hopefully be helpful in life. If I can find the key to excelling here I will be in tune with the business world later in my career. This course sounds like it will be hard, but I am ready to put in some work and succeed.