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Participative Management and Productivity: Partners or Participative Management and Productivity: Partners or

Adversaries? Adversaries?

Michael Heenan Swearingen Western Michigan University

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PARTICIPATIVE MANAGEMENT AND PRODUCTIVITY:PARTNERS OR ADVERSARIES?

by

Michael Heenan Swearingen

A Dissertation Submitted to the

Faculty of The Graduate College in partial fulfillment of the

requirements for the Degree of Doctor of Education

Department of Educational Leadership

Western Michigan University Kalamazoo, Michigan

June 1995

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.

PARTICIPATIVE MANAGEMENT AND PRODUCTIVITY:PARTNERS OR ADVERSARIES?

Michael Heenan Swearingen, Ed.D.

Western Michigan University, 1995

The purpose of this study was to determine what style of management was

used by different office furniture manufacturers and whether or not a participative

style of management affected organizational productivity. Organizational produc

tivity was defined by factoring together the yearly sales and the financial stability

for the organization, as defined by Dun & Bradstreet.

The five hypotheses studied were:

1. The higher the educational level of the organization's management

is, the more likely they are to use a participative style of management.

2. The older an organization is, the less likely they are to use a partic

ipative style of management.

3. The older an organization's managers are, the less likely they are to

use a participative style of management.

4. Organizations that use a participative style of management are more

likely to be smaller in size than organizations that use a rigid style of management.

5. Organizations that use a participative style of management will have

increased productivity that will result in increased financial stability.

Likert's Profile of Organizational Characteristics was sent to 673 execu

tives of 120 companies listed in Dun & Bradstreet's Million Dollar Directory, as

having the Standard Industrial Classification code of 2521 or 2522. Additional


demographic data were collected on the respondent's age, sex, educational level,

their place in the organizational and the age and size of the organization (number

of employees and buildings). A total of 162 replies was received back and or

dered into response groups from executives within the same organization.

No conclusions could be drawn about the first, second, third or fifth

hypotheses. The analysis of the fourth hypothesis, that smaller organizations are

more likely to use participative management, revealed a positive relationship;

however, this would be interpreted as the larger the organization is, the more

likely it would be to use participative management, the opposite of the original

hypothesis.

An analysis of the difference between the responses by female and males

within the same organization showed that females, in organizations where a female

was the top executive, responded in nearly the same manner as their male coun

terparts. Females in organizations where males were in the top executive posi

tions gave responses that were substantially different Gower) than their male

peers.


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Copyright by Michael Heenan Swearingen

1995


ACKNOWLEDGEMENTS

Not being a "traditional" student, my path on the road of knowledge has

been long and rocky. Frequently, just prior to the completion of a long project, I

found myself wondering if I really wanted to continue or just pull the plug and let

everything quietly expire. It was during these periods that my wife, through both

flattery and threats, helped me jump start myself again. Without her help and

patience, I never would have finished.

I would also like to thank A1 Demers, Simonds Industries Corporate

Manager for Accounts Receivable/Payable. A1 performed a lifesaving act by

getting me the financial information I needed on the various organizations that

responded. Without Al's help, my fifth hypothesis could never have been tested.

Last, but not least, I would like to thank my committee members, Uldis

Smidchens, Dale Brethower and Patrick Jenlink. Dr. Smidchens, especially,

probably thought I had died and was buried in an unmarked grave when he hadn't

heard from me. His calls to me were another source of inspiration of "I want you

done and out of here".

All joking aside, I could not have done it without the people mentioned and

I want each of them to know how much I appreciate their help and concern.

Michael Heenan Swearingen

ii


TABLE OF CONTENTS

ACKNOWLEDGEMENTS..................................................................................... ii

LIST OF TABLES................................................................................................. vi

CHAPTER

I. INTRODUCTION....................................................................................... 1

Statement of the Problem....................................................................... 1

Purpose of the Study.............................................................................. 2

Summary................................................................................................ 3

II. REVIEW OF RELATED LITERATURE................................................... 5

Introduction............................................................................................ 5

Increased Communication.................................................................... 3

Quality Circles (QC).............................................................................. 9

Quality of Work Life (QWL)............................................................... 11

Joint Decision Making........................................................................ 12

Conflict Resolution.............................................................................. 15

Increased Job Satisfaction................................................................... 16

Increased Cooperation........................................................................ 17

Productivity.......................................................................................... 18

Summary.............................................................................................. 29

in . DESIGN AND METHODOLOGY........................................................... 31

Design of the Study............................................................................ 31

Participants in the Study...................................................................... 32

Instrumentation..................................................................................... 32


Table of Contents - Continued

CHAPTER

Collection of Data............................................................................... 34

Analysis of Data.......................................................................... 35

Hypothesis 1............................................................................... 36

Hypothesis I I ............................................................................ 36

Hypothesis III............................................................................. 37

Hypothesis IV ............................................................................. 37

Hypothesis V .............................................................................. 38

Summary.......................................................................................... 40

IV. RESULTS................................................................................................ 41

Introduction..................................................................................... 41

Demographic Characteristics of the Sample....................................... 44

Level 1 Female Present............................................................... 46

Level 1 Female Not Present.................................................. 46

Analyses Results................................................................................. 47

Results of Hypothesis 1...................................................................... 52

Results of Hypothesis II ..................................................................... 53

Results of Hypothesis III................................................................... 54

Results of Hypothesis IV ................................................................... 55

Results of Hypothesis V ..................................................................... 56

Summary.......................................................................................... 57

V. CONCLUSIONS AND RECOMMENDATIONS..................................... 59

Conclusions....................................................................................... 59

Response Rate......................... 60

iv


Table of Contents - Continued

CHAPTER

Correlational Analyses......................................................... 61

Hypotheses........................................................................................ 64

Hypothesis 1............................................................................... 64

Hypothesis I I .............................................................................. 65

Hypothesis HI.......................................................................... 65

Hypothesis IV ............................................................................ 66

Hypothesis V .............................................................................. 67

Recommendations.............................................................................. 67

Study Format Changes............................................................... 69

Summary.......................................................................................... 70

APPENDICES

A. Protocol Clearance From the Human SubjectsInstitutional Review Board........................................................................ 71

B. Cover Letter Sent to Participants.............................................................. 73

C . Profile of Organizational Characteristics andDemographic Survey.......................................................................... 75

D. Correlational Analyses of POC Sub-Factors WithPOC Sub-Factors................................................................................. 78

E. List of POC and Demographic Survey Components................................ 80

F . Summary Table of Correlational Analyses............................................... 82

G. Original SPSS-X Data Print Out..................................................... 84

BIBLIOGRAPHY.............................................................................................. 108

v


LIST OF TABLES

1. Demographic Characteristics of the Respondent Sample............................. 44

2. Comparison Between POC Sub-Factors andSub-Factor Average (Factor 2 6 ).................................................................... 47

3. Correlations Between POC Factors.............................................................. 48

4. Correlations Between Demographic Factors Exceeding 0.29........................ 49

5. Correlations Within Financial D ata.............................................................. SO

vi


CHAPTER I

INTRODUCTION

Statement of the Problem

Much has been said about participative management. Its adherents,

companies such as Hewlett-Packard, Harman International Industries, Cooperati-

va Central, International Group Plans, and British Triumph Motorcycle, to name

a few, tout it as the cure for all ills while its opponents, including General Foods,

McCaysville Industries, Rushton Mining Company, and Vermont Asbestos

Group, label it as an ivory tower pipe dream, unworkable in the "real world".

Those who are in favor of a participative style of management state that

the persons who oppose it really do not understand what they are opposing, that

participative management leads to increased productivity by increasing employee

involvement, and this leads to increased employee morale, which helps boost

productivity even farther. Participative management is composed of several

essential ingredients, including increased communication, quality circles (QC),

quality of work life (QWL), joint decision making, conflict resolution, increased

job satisfaction, and increased cooperation. There are other parts of the participa

tive management system, but they play a relatively minor role as compared to the

listed building blocks (Glaser, 1973).

Some organizations have a written policy stating that they believe in and

use a participative management style of management (South Bend Lathe, Inc.,

Saratoga Knitting Mill, and Mohawk Valley Community Corporation, for exam-

1


pie), however, it commonly becomes the case that although the organization may

subscribe to or pay lip service to the goal of participative management, the

communication is still from the top down with all decision and policy making held

in the hands of the top management personnel. This could be caused by several

factors, including unfamiliarity with what participative management really is and

how it works, and a static organization that has become complacent and actually

does not want to "rock the boat". One of the most commonly voiced concerns is

how much it will affect productivity and the "bottom line". If a program increases

productivity, but costs more than the additional productivity it generates, then the

program is essentially useless, since the goal of nearly all organizations, unless

they are non-profit or governmental agencies, is to make a profit..Is 1

Purpose of the Study

This study examined the relationship between the style of management

used and level of productivity, measured in terms of the organization's financial

stability. Other variables examined included the age of the top level managers,

their educational level, the size and age of the organization, and the organiza

tion's physical parameters.

In this study, the answers the respondents gave to the Profile of Organi

zational Characteristics (POC), were grouped for managers within the same

organization. The responses from within the organization were averaged to

produce a set of single values for each organization that were then compared to

other organizations as well as other factors, including financial stability. Chapter

n consists of the following major sections devoted to the various aspects of partic

ipative management: increased communications, quality circles, quality of work


life, joint decision making, conflict resolutions, increased job satisfaction, in

creased cooperation and productivity.

The sources of information for this study came from many sources, in

cluding various periodicals, books, papers presented at professional conferences,

studies performed by governmental agencies and educational institutions and

dissertations, to name a few.

The following hypotheses were tested during this study:

1. The higher the education level of the organization's managers is,

the more likely they are to use a participative management style of management.

2. The older an organization is, the less likely they are to use a partic

ipative style of management.

3. The older the organization's managers are, the less likely they are

to use a participative style of management.

4. Organizations that use a participative style of management are more

likely to be smaller in size than organizations that use a more rigid style of

management.

3. Organizations that use a participative style of management will

have increased productivity that will result in increased financial stability.

Summary

By determining whether or not productivity is affected by the use of a

participative style of management, we are laying the ground work for making

companies more competitive. As companies become more competitive, the cost

of the items they produce becomes lower, allowing the consumer to spend less

money on individual products which, in turn, allows them to make additional


purchases of other items. The conclusions from this study could point the way to

making companies more competitive by adding additional information to the

management process.


CHAPTER n

REVIEW OF RELATED LITERATURE

Introduction

A great number of studies have dealt with the concept of participative

management, what factors enhance it, what factors detract from it and what fac

tors influence whether or not it will even work. A review of the literature was

necessary to help determine the factors involved in defining whether or not other

studies that were done previously even addressed the issues that were targeted or

if they were pertinent, what the results were. The studies reviewed were divided

into one of seven categories, increased communication, quality circles (QC),

quality of work life (QWL), joint decision making, conflict resolution, increased

job satisfaction, increased cooperation and productivity (Glaser, 1973).

A number of sources were used in this review including periodicals, books

by established participative management experts, government and educational

agency publications, dissertations, article abstracts and other materials.

Increased Communication

Theological seminaries, as a rule, are rather bound by tradition, however,

Isenhart (1986) examined the issue of increasing employee participation in the

decision making and management processes of a Roman Catholic seminary. Data

were collected on how the decisions were made after Likert's Profile of Organiza

tional Analysis (POC) was explained to the participants at the seminary. Each

5


decision, after it was made, was rated by the persons involved as to whether it was

made using System 1, 2 3, or 4 (exploitive, benevolent, consultative, and partici

pative). The results demonstrated that there was a shift towards the participative

style of management, and that communication more easily flowed both up and

down through the hierarchy concerning these joint decisions. The paper conclud

ed on the note that there was little likelihood that employee participation in deci

sion making would advance beyond the present level due to the fact that the Vati

can had the final authority over the seminary, even though this style appeared to

produce more positive attitudes among the lower echelons.

One of the primary identifying components of a participative style of

management is the increase in communication from the lower to upper echelons.

One hundred three clerical employees and the lowest level of supervisors were

part of a study conducted at a comprehensive eastern university (Wheeless, et al,

1982). The questionnaire filled out by the participants measured communication

satisfaction with supervisors, supervisory receptivity to information, decision

participation level, actual participation versus desired participation difference, and

job satisfaction in relation to the supervisor, coworkers, promotions, compensa

tion, and work. The highest correlations within the study were found to be those

of communication satisfaction with the supervisors (0.9596) and satisfaction with

supervisors (0.9507) in regards to job satisfaction, that is, job satisfaction ap

peared to be highly correlated with communication satisfaction with supervisors

and general satisfaction with supervision. Interestingly enough, the lowest corre

lation found to exist (0.4275) was satisfaction with the communication with co

workers correlated with job satisfaction. This study was strictly a survey tool and

no training in the style of participative management was given prior to the admin


istration of the survey. The main thrust of this study was to show that job satisfac

tion is greatest when there is open communication between the workers and super

visors, one of the main premises of participative management. One blot on this

otherwise rosy picture occurred when the correlation of 0.43 was found between

job satisfaction and communication between co-workers. Communication in a true

style of participative management occurs not only up and down, but also within

levels, something which is obviously lacking to some extent here.

Phillips (1977) conducted research into the types of communication pat

terns used by two television group owners, whom he defined as fully owning

more than one United States commercial television station. The station manager

and subordinate managers were given Likert's Profile of Organizational Charac

teristics to help delineate and define what management style was used to generate

communication within the organization. The results of the study were that

although both of the general managers had similar roles, the philosophy of one

organization was more in line with a participative management style which result

ed in more open channels of communication between the various levels in the

organization.

Neil Bamhard (1980), developed a continuing education course for the

beginning or inexperienced supervisor. It was the feeling of Mr. Bamhard and

the program development staff, that the most important areas to concentrate on

were leadership, communication, conflict resolution, and motivation skills. The

article concentrates on the necessity of the supervisor and subordinate working as

a team, with open communication and a share in the decision making process,

both of which are essential components of participative management.

Flood (1985) wrote a treatise on effective leadership. His primary conten-


tion is that unless you have an effective leadership style, you really won't be

leading, but will just happen to be at the head of a pack going in a specific direc

tion. Although he describes his favorite style as consultative, his preferred style

has a number of participative management factors leavened in. The primary keys

to having good workers are communication, involvement in the decision making

process, and group involvement.

Most people consider quality circles (QC) and quality of work life pro

grams (QWL) to be synonymous with the concept of participative management,

however, while QC and QWL programs are similar, they do have some differ

ences and are a part of participative management systems, not a system in and of

themselves. Savage and Romano (1983) articulated what they perceive as the

differences in a paper presented at the Annual Meeting of the Eastern Communi

cation Association. They argued that QCs are usually involve employees with

similar backgrounds solving technical problems related to the job whereas with

QWL programs, the employees come from different levels and are involved in the

entire work environment. The QCs in Japan do not focus their programs strictly

on developing solutions for technical problems, rather they offer alternative

method for dealing with the company. Through the QC program, the average

Japanese worker can assist in planning production, receiving additional training,

and assist in modifying the work environment to more carefully suit the workers.

QC teams in the United States however, are formed to solve only technical prob

lems and are not allowed to roam outside the technical area of interest. This

causes the QC to succeed initially, but fail in the long run since the curiosity of the

participants eventually diminishes. The QWL offers a concept similar to what the

Japanese use as a QC concept, but involves the employee at a greater level than


the Japanese QC does. Whichever a company decides to use, either QC or QWL

program, they should be part of an integrated package that comprises a participa

tive management system.

Quality Circles (QC)

One of the major components normally seen in most participative man

agement programs is quality circles. Small (1987) examined participative man

agement in public school systems, specifically,an elementary and middle school in

the Baltimore public school system. Using an open ended questionnaire, the

teachers in each building were queried as to what they felt were the most pressing

problems facing them each day. The quality circle took the resulting answers and

tabulated them, and deciding to tackle the problems which were most frequently

mentioned. The teachers involved in the circle would brainstorm to come up with

possible solutions to each of the problems, come to a general consensus as to

which solution would be the most practical, and finally, submit their recommenda

tions to the appropriate authority. It is the contention of the author that participa

tive management can be introduced into organizations and work successfully as

long as there are upper level managers who are willing to commit resources to and

support quality circles and participative management.

In 1985, J. P. Elvins investigated how quality circles affected communica

tion within the organization. A random sample consisting of 102 quality circle

members from five different organizations were given Likert's Profile of Organi

zational Characteristics and an open ended survey concerning the respondent's

personal experiences with quality circles. The results of the study evidenced the

fact that the employees in the quality circles felt that quality circles had positive


effects on perceived individual influence, communication with superiors, subordi

nates and peers. The responses given, however, placed the organizations in either

a benevolent exploitative or consultative management system.

Central Piedmont Community College decided to institute a quality circle

(QC) program in the media production department (Moretz, 1983). The results

of the implementation showed that QC programs can be successful, but they also

encountered some problems while establishing its worth. Due to the fact that the

QC approach started in industry, there were some faculty members that ques

tioned the applicability of QC programs to an educational setting. Another prob

lem arose due to the number of other required meetings already planned for other

items, such as curriculum, etc., limiting the amount of available free time for QC

meetings. Interestingly enough, the number of advanced degrees proved to be a

two edged sword, allowing the participants to quickly grasp the essentials, but

also causing problems due to differing philosophies. Other problems included the

"end-of-the-term" slowdown, lack of budget flexibility, how to define "productiv

ity" in education, and worst of all, a number of educators were mired in a feeling

of helplessness due to previous tries at making changes and therefore exhibited

very low confidence in their ability to change things.

Satterwhite (1982) developed a method for effectively managing quality

circles in educational settings, including exercises and assessments. The author

felt that the necessary components of a successful quality circle were good plan

ning, trained participants, meeting management, group process, and following

through on decisions that came from the group.

Many individuals regard quality circles (QC) as a type of organizational

interventional strategy to optimize productivity and product quality through


employee participation. Hellweg and Freiberg (1984) investigated a number of

quality circles to test the viability of the quality circles concept specifically in

terms of whether or not they had any effects on the desired organizational out

comes. The authors felt that although the studies that they reviewed showed

promise, most of the studies exhibited little empirical evidence of attainment of the

predetermined goals. They felt that future studies should be directed towards

testing the specific effects of quality circles on the organization and individual.

Quality of Work Life (QWL)

Quality of work life (QWL) is a fairly recent development and is particu

larly new and unknown in the United States. Most Americans have heard of

quality circles (QC), usually in connection with the start up of a QC in their own

organization. Interestingly enough, while most people think that the Japanese

invented the QC concept, it was really part of the restoration effort of the Ameri

cans after the end of World War II. QWL differs from QC in that QWL encom

passes all of the aspects of a QC but also looks at the entire working environment

and does not limit itself to just technical problems as do the QC programs.

Pratzner and Russell published a paper in 1984 on the development of QWL for

use in vocational education programs. Their report limited itself to two major

items, the implications of QWL developments for the content and instructional

processes of vocational education, and what new participative management tech

niques may do to improve the nation's educational delivery system. The primary

thrust of the article is that educational needs to learn from industry and modify

the QWL techniques that have worked in industry to the educational setting. It is

the firm belief of Pratzner and Russell that QWL may not necessarily be the


panacea for all of the educational problems that are currently facing schools, but

that in these days of eroding tax revenues, any technique that will allow the better

and/or more efficient use of the available dollars should be earnestly studied.

One of the biggest problems facing unionized employers and unions today

is the resistance to change that they both experience when they present new and

novel ways of doing things to the other party. Savage in 1984, examined a joint

quality of work life (QWL) program established by two management/union

committees, composed of a municipality, a local university, and a union local.

The initial agreement stated that this was to be a 24 month experiment funded with

federal grant money. By the end of the grant (1978), the program was going so

well that the decision was made to continue the program using both union and

management funds. One of the primary focus points of the QWL committee was

decision making, and by the use of joint decision making between the various

involved parties, there was a "buying in" mind set that allowed changes to occur

that were thought to be impossible at the introduction of the QWL program.

Joint Decision Making

In contrast to McGregor's Theory X and Y, Owen (1987) has proposed a

new addition to McGregor's two theories, namely Theory Z. Theory Z differs

from either of the other two theories in that it reflects a participatory decision

making model, a reflection of the Japanese culture where it came into being. A

study was performed at Illinois State University where 18 departmental chairper

sons were queried as to their management style (Semlak, et al, 1986). The pur

pose of this study was to try and chart the current management style of a major

university and plot a probable future. The results of the study exhibited some


rather strange characteristics. The chairpersons, by and large, regarded their

management styles as being derived from Theory Z, however, on the two most

important issues (for Theory Z), they went wholeheartedly with a Theory X

stance. These two issues were quality control of the product (a top priority with

the Japanese), and tenure/promotion. The quality control statement that they

objected to was "In my department the entire faculty feels responsible for main

taining quality teaching, research and service. We continually have discussions of

how we can improve in these areas. ". They felt that tenure and promotion did

not arise from hard work but rather by "...getting along with key faculty members

in the department." These contradictions put a large stumbling block in way of

accepting that they have a Theory Z style of participatory management. A pro

vocative point to consider here is that while industry is moving towards a Theory

Z style of management, one of the leading universities in Illinois is moving to

wards a Theory X style of management.

Worker participation in decision making has often been touted as a "cure-

all" for labor related problems. Lloyd and Rehg (1983), investigated the quality

circle concept, which is considered by many to be one of the cornerstones of

participative management. They chose the area of vocational education to exam

ine what should be done to insure that quality circles were as successful as possi

ble.

The authors suggested that a quality circle course be included during the

final year of education and that the course be based upon the practical applica

tions of the quality circle process. The first skills to be taught were those of

management and leadership, supplemented by goal setting and conflict resolution.

As the students enter the third and fourth quarters, they would find themselves


14

tackling such issues as QC problem solving methodology, team building, statistical

quality control, simulation and process implementation techniques. The final

result would be a student with the practical and theoretical tools that would enable

them to successfully implement a quality circle program.

The subcommittee on Federal Services commissioned a report for various

agencies to consider when designing and implementing employee involvement

programs ("Employee Involvement" 1988). The key points of employee in

volvement programs that were noted were derived from an extensive study of the

experiences of both private and federal employers. One of the most important

factors to be addressed when considering the institution of an employee involve

ment program is management interest and support. The authors of this study,

along with a number of other researchers, feel that without management interest

and support for an employee involvement program, it is doomed from the start.

Other key concepts to weigh include a readiness assessment, communications,

training, and evaluation. A readiness assessment is necessary since a number of

employee involvement efforts have failed simply through the lack of readiness, a

case of trying to run before they could walk. Communications within and

throughout an organization is always critical but especially when the organization

is attempting to involve employees in the decision making process. Another

common problem for employee involvement programs is the lack of training in the

essential techniques needed for staying on task and assuring that everyone is

involved to the maximum extent. The last, but possibly the most important part of

an employee involvement program is a continual evaluation. This is imperative to

establish that progress is being made towards the original goals. The report

summarized its findings by stating that each of these salient points must be present


or the final product will probably not reach fruition.

Another study also examined participative management in an educational

setting. Robinson (1976) chose to examine the 675 teachers were given a ques

tionnaire that dealt with each person's input into the decision making in the school

system. The results of this study showed that the principals believe that the teach

ers have a greater role in the decision making than the teachers perceive that they

do, and the teachers believe that the principal's role in decision making is greater

than the principals themselves perceive it to be. Robinson feels that by increasing

the amount of participative management in the schools, the levels of teacher job

satisfaction and organizational productivity will also rise.

One of the primary constituents of a good participative management system

is participation in the decision making process. Steve (1984) was commissioned to

identify career development needs for students entering the National Institute for

the Deaf. One of the most essential ingredients for success that he found was

decision making/problem solving. In his paper, the various models and concepts

of participative management were reviewed, including ideas and views by Hep-

pner (1978), Greeno (1978), Bruner, et al (1956), and others. The conclusion of

the paper was that decision making/problem solving was one of the primary keys

to success, however, the process of decision making/problem solving is not an

instinctive procedure, but rather something that each person must be trained in

order to insure that they have the fundamental tools and strategies in order to

successfully solve a problem by devising and implementing a solution

Conflict Resolution

Another problem facing organizations is conflict, how to manage and


resolve it. In 1983, the New Mexico Research and Study Council performed an

analysis of the results of conflict within an organization, how to best manage them

so that they are productive rather than counterproductive, lb do this, they listed

the various sources of organizational conflict, reactions of the participants and

observers, and conflict resolution strategies. The study's authors believe that

conflict can be a valuable addition to the organization as long as the managers/

administrators can effectively respond to the conflict using the proper techniques

including increasing inter-group interactions, development of superordinate goals,

and organizational restructuring.

Increased Job Satisfaction

Another aspect of participative management was analyzed in 1985 by Fish

and Adams, by comparing the size of the organization with its management style

and the job satisfaction of the Program Directors associated with each of the

respondent television stations. Questionnaires were sent to 274 randomly selected

stations with a return rate of 66.1 % (181). The results of the survey revealed that

as the stations grew larger in size, they were more likely to use a participative

style of management, and that Program Directors who were oriented towards

higher levels of management were more likely to express greater job satisfaction

than those who were not oriented to higher levels of management.

Unlike Beehr and Gupta (1982), Gaziano and Coulson (1987) did not find

that a "looser" style of management promoted job satisfaction among employees.

They examined two newspapers that were owned by the same company, a morning

paper and an evening paper. The 125 journalists that were polled using a 12 page

survey rated the morning paper as a blend of "democratic and authoritarian" while


the evening paper was considered to be authoritarian. The results of the survey

were that the journalists on both papers felt that their participation in decision

making was important, but the employees at the morning paper (democratic/au

thoritative) were no more likely to participate in decision making than the em

ployees of the more formal evening paper. In fact, there was more satisfaction

found in the working relationships between the journalists and the editors at the

evening paper than at the morning paper. The factors which caused this "dif

ference" from what was expected are unknown, but the authors suspect that it may

have to do with the fact that journalists tend to be more transient than other pro

fessionals.

Increased Cooperation

There have been major developments over the course of time in labor-

management relations, especially in the area of cooperation. There have been

many changes in the direction of negotiations between unions and the manage

ment. Two of the most profound changes have been the cooperation between

unions and management, and cooperation between management and the individual

employees. McCabe (1984) performed an integrative analysis on these two as

pects of cooperation between labor and management in an effort to help balance

the overwhelming glowing reports of participative management that usually

manage to either gloss over or ignore the negative features of participative man

agement. The final point of his analysis is that cooperation and participative

management are not ventures that can be put into place immediately and yield

instantaneous results, but rather need to be introduced slowly over a protracted

length of time.


Productivity

In a report on union-management cooperation prepared for the W. E.

Upjohn Institute by M. H. Schuster (1984), the author examined a number of

organizations over a five year period with the primary focus of the study being

improved productivity. One of the sections of this study dealt with a comparison

between Scanlon plans and Quality Circles. Some people use the two terms inter

changeably, they are, however, not the same thing. Scanlon plans are the

"brainchild" of Joseph Scanlon, a cost accountant and United Steel Workers union

official. During the mid 1930's, Scanlon devised a plan where a formula was

devised to help share the profits with all of a company's employees. This ap

proach encouraged increased union-management cooperation that changed their

previous adversarial working arrangement to one where the main focus was aimed

at reducing costs and increasing output (Moore and Ross, 1987).

Quality Circle committees usually involve more people than Scanlon

committees, rewards for suggestions usually are distributed between the members

of the circle whereas the Scanlon plans distribute the savings over the entire work

force, and last, the author notes that most companies who establish Quality Circles

are more likely to maintain traditional, authoritarian views on employee participa

tion and involvement.

The educational and organizational strategies required for improvement of

worker-centered productivity was the subject of a paper by Drewes (1982).

Drewes felt that unless a person was able to accurately assess productivity, there

could be no meaningful decision on whether or not changes that were made in the

organization were actually part of the solution and not an additional part of the

cause. The equation developed was that productivity equals the output (system


products) divided by the input (resources used). Using this equation, it is easily

understood that increased productivity could be caused by any of the following: (a)

an increase in the overall output (input remaining constant), (b) a decrease in the

resources used (output remaining constant), (c) an increase in the output with a

simultaneous decrease in the input, (d) a larger increase in the output than in the

input, and finally, (e) a smaller decrease in the output than is found in the input.

These five different scenarios must be considered whenever there is a major

change in the organizational philosophy, such as the introduction of a participative

management system. Drewes felt that there are four vital ingredients to successful

productivity improvement, information distribution, communication between indi

viduals, a mutual understanding and general consensus as to what the problem to

be tackled is, and finally, involvement of all parties. All of these issues must be

addressed through increased education of the involved workers into how to func

tion as a team and open the channels of communication, therefore it becomes vital

ly important that a participative management program is not just installed in place

without adequate training for all workers as to its function and purpose.

Although participative management systems appear to be the solution to

many of today's organizational work problems, one of the main factors to be

concerned about is productivity. If the productivity stays constant while the costs

go up, the organization will eventually go bankrupt and close, causing catastrophic

dislocations among its employees. In a study performed under the auspices of the

U.S. General Accounting Service, 36 firms who had installed productivity sharing

plans and nine who were either considering or had rejected productivity sharing

plans were interviewed. The results showed that 34 of the 36 firms with plans

currently in place detected an increase in productivity after the plans were initiated


20

and were going to continue to use the plans. There were two firms that were

unhappy with the plans in place. One firm had been increasing the amount of

automation that was associated with the job, reducing the potential of the workers

to affect production. The other company had come to feel that money was no

longer a good incentive for the workers and was planning to institute a Quality of

Work Life (QWL) program to replace its productivity sharing plan. On the

whole, it appears that productivity sharing plans, such as Scanlon, Rucker, and

Improshare, do have a positive effect on the productivity of the employees.

Previously, Frost, Wakely, and Ruh (1974) performed a rather intensive

look at Scanlon plans, what they were, how they were used, what were the advan

tages and pitfalls. Their analysis of the Scanlon plan showed an increase in

communication and an increase in productivity, however, a noticeable defect in

their study was that the productivity increase was never examined for short or long

term negative effects, such as short term increased costs, or long term losses due

to increased costs, etc. One negative side effect that did turn up was that in

several cases, increased productivity did not result in increased profits for the

company which could be passed on to the employees as bonuses. This had soured

the participating employees on any sort of participative management style profit-

sharing plan.

Beehr and Gupta (1982), examined two automotive supply organizations

which were similar in both size and level of technology used to conduct business,

but differed in managerial style. One plant was high unionized and therefore had

a very rigid hierarchical structure while the other plant used a modified Scanlon

plan (Frost, Wakely, & Ruh, 1974). The results of the study showed that the

employees at the unionized plant had a greater level of stress then the employees


of the plant that utilized the modified Scanlon plan, which manifested itself not

only in the measures taken through structured interviews, but was also seen in the

fact that the absenteeism was approximately 4 times greater in the unionized plant.

This difference is significant, however, Beehr and Gupta (1982) did not mention

analyzing the union contract to determine whether or not the contract language

might have inadvertently lead to increased absenteeism. The final conclusion of

this study was that the work environment was less stressful for the "rank and file”

but more stressful for the managerial staff in the organization where participative

management was used.

Steven Pejovich (1984) presents a contrasting point of view concerning

participative management as he depicts the style of participative management as it

is practiced in four different countries, West Germany, Norway, Ireland, and the

United States. Pejovich carefully outlines the conditions under which participative

management existed in the study's population, and then proceeded to show the

underlying assumptions that have been used for the rationale for the styles found.

In West Germany, several laws have been enacted to insure that the labor groups

represent approximately half of the entire board of directors in all companies that

have over 2,000 employees. Norway has gone even further into mandatory partic

ipative management by decreeing that labor participation in small firms (less than

50 employees) are subject to voluntary negotiations, medium sized firms (50-200

employees) must allow the employees to elect up to one third of the board if 50%

of the employees so desire, and it is mandatory that large firms (greater than 200

employees) have one third of the board comprised of employees. Another interest

ing feature of Norway's attitude towards participative management is that local

governments are not asking for a direct board representation.


22

Ireland, in 1977, passed the Worker Participation Act which mandated, in

a fashion similar to Norway's provisions, that one third of all boards of directors

must be composed of employees who are employed with the specific company

whose board they are on.

At the present time, participative management in the United States is

primarily a joint voluntary effort between the workers (or unions) and the man

agement. Signs of mandatory employee involvement are beginning to be seen in

the statements of participative management proponents, whose primary argument

for the passage of laws is that this would replace conflict between labor and

management with cooperation. In fact, in the countries where such laws have

been passed, it appears that the board usually divides itself into two camps, stock

holders and employees. Prior to each full board session, each of the groups meet

to discuss and map out strategy for the next meeting. This turns the board meet

ings into negotiation sessions rather than incubators for ideas. One critical issue is

the problem of confidentiality, and evidence from West Germany suggests that the

employee board members have leaked essential information to the unions during

wage negotiations.

The prime premise of this study is that if participative management pro

duces such excellent results, then why does it have to be legislated, since compa

nies are usually willing to try almost anything that will positively affect the bottom

line.

Edward Glaser (1973) spent considerable time gathering case studies of

organizations concerned with participative management. In a number of these

studies, the organization was floundering, apparently ready to collapse at any

moment when the upper level management decided to try using a participative


23

management approach to try and ward off the demise of the organization. In each

case, the company turned around and began to be profitable, or became more

profitable. In each of the case histories that were presented, the underlying theme

was that of a joint effort in problem solving and decision making between the

management and workers.

Some early research by Milutinovich (1971) into job satisfaction and group

cohesiveness was performed using race as one of the discriminant variables.

Using the Job Descriptive Index, Seashore's measure of group cohesiveness, and

Likert's Profile of Organizational Characteristics, the researchers found that there

was little differences between white and black workers in that they both preferred

a participative style of management to the more structured styles and this was

reflected in higher job satisfaction, greater group cohesiveness, increased pay, and

increased number of promotions. In summation, race appeared to play little if any

part at all in terms of job satisfaction and other measures of work group stability.

In fact, the more participative the style of management was, the more likely the

workers were to have increased job satisfaction.

Educational institutions should be on the cutting edge of new ideas, but in

1978, S. A. Prewitt found out differently. Likert's Profile of Organizational

Characteristics was sent out to a random sample of administrative employees from

the 31 educational institutions that make up the Southern Association of Colleges

and Schools (each of the schools in the sample had to have bachelors, masters, and

doctoral programs). The results of the study indicated that nearly all of the admin

istrative employees felt that their school's style of management fell somewhere

within the domain of consultative style. Interestingly enough, none of the re

spondents felt that their institution should be ranked as tending towards a participa-


tive management style on any of the twenty questions asked.

David Nash (1985) performed a similar study using dental colleges in the

United States. The deans, associate deans, and departmental chairs of the 60 U.S.

dental colleges were given a survey that consisted of a modified version of

Likert's Profile of Organizational Characteristics. The results of the survey

showed that there was very little difference between the results obtained by Pre

witt in his study and the placement of the dental colleges. Both schools tended to

be in the consultative style of management with occasional tendencies towards a

benevolent authoritarian format.

Considerable work and study has been given to the topic of Scanlon plans

and participative management, and one of the acknowledged experts in the field C.

F. Frost, coauthored a book on this matter with J. H. Wakely and R. A. Ruh

(1974). According to Frost, et al, all sharing plans, Scanlon not withstanding,

must have four basic underlying principles, an identity, participation by em

ployees, chance of equity (that is, an equitable return on their invest of ideas,

energy, competence and commitment), and finally, managerial competence. Frost

felt that even if the three other principles were in use, the plans would ultimately

fail if managerial competence was not present. Basically, the authors felt that if

employees believed that management was incompetent and that decisions were

irrational, then they would lose confidence in management and their cooperation

and work would suffer. Additional work by Thylor and Cangemi (1983), con

firmed the suppositions and principles set forth by Frost, et al.

In 1980, Daniel Zwerdling collected a series of case histories on participa

tive management, when it worked, and when it did not. In every case where

participative management styles were introduced, there were some immediate


changes for the better, however, in some instances, the changes that were wrought

reverted back to the previous unacceptable circumstances. In each instance where

there was a failure, it could be easily seen that much of the failure was due to the

fact that there was more lip service than actual follow through. This caused the

employees to become discontented with their jobs, and thus affected the organiza

tion's productivity. The main point that was driven home was that if a company

plans to introduce a participative management style, they must invest both the time

and effort necessary to make it work, including the retraining of traditional author

itarian managers and educating the employees themselves. Without firm backing

from upper management, including free flowing communications from the top to

the bottom and back, any attempt to introduce participative management will fail

and could actually make things worse than what they may currently be.

Hewlett-Packard is considered by many experts to be a forerunner in the

effort to effectively train and develop its management team (Nilsson, 1984). The

fundamental essence of the Hewlett-Packard program is that each employee is

involved in the company from their first day. They are instructed in the "HP

Way", the methods of corporate communication, decision making/problem solv

ing, and continuing training, to insure that they understand what to expect and

what is expected of them. These "rules of conduct" and corporate philosophy are

stressed through each training course and orientation, including those given to

senior corporate executives. The result is that the channels of communication

flow freely from the bottom to the top of the corporate structure as well as within

each level. This "whole corporation" approach has encouraged the employees to

challenge each other and the company to constantly improve on what they have,

striving for the optimal payback on each dollar spent.


26

The Duluth Minnesota Public Schools were in trouble in the early 1980's,

as evidenced by teacher strikes and employee relations benchmarks such as absen

teeism and turnover (Moeser & Golen, 1987). In 1984, the school board decided

to improve management and employee relations by instituting a participative

management plan. The plan stressed communication between the various levels of

the system as the best way to achieve results. The board went on to establish a

participative management policy, rules and regulations, a structure for communi

cation and sharing of ideas, and a budget for the process. The results of the

program showed that prior to institution of the plan, 152 grievances were filed,

however, in the first semester of the 1986-87 school year, only nine were filed.

The authors feel that the reduction in grievances is just the tip of the employee

relations iceberg, that there is vastly improved communications between the vari

ous organizational groups and many problems that would have been grieved earlier

are now being jointly resolved through the participative management process.

Three school districts were the focus of a paper that investigated the

concept of team management (Anderson, 1988). The team management approach,

as outlined by the author, is a participative management system that involves the

upper level administrators and excludes the middle level administrators and teach

ers. One of the key principles of the team management approach is that nearly all

of the decisions are a result of team consensus. Although this requires taking

longer to reach a decision, each of the school districts found that adding the extra

time to the beginning of a project shortened the implementation time and caused

fewer problems than had occurred with a "top down" decision.

Harris (1986) proposes three different leadership styles, the manager-as-

technician, manager-as-conductor, and manager-as developer, similar to the lead-


ership styles expounded upon by Bradford and Cohen in their book Managing for

Excellence (1984). Basically, the manager-as-technician is the manager who has

been promoted up the ladder to the present position. The manager got to the posi

tion by excelling in some area that is linked to the position. An example of this

would be promoting the top salesman to the position of sales training manager, the

supposition being that the best salesman is doing the right things, therefore, the

person must also know how they did it and can teach those skills to others. The

manager-as-conductor is an unfortunate offshoot of the participative management

theory, that is, the manager's prime goal is to try and work through the em

ployees, in other words, to control the individuals under them and make certain

that they perform the correct actions. The problem with both this and the manag-

er-as-technician styles is that both force the subordinates to rely on the manager's

direction, knowledge, and planning, thereby stunting the potential growth of the

subordinates. The third style, manager-as-developer, is the true inheritor of the

participative management mantle. These managers share the responsibility with

their employees and attempt to "develop" the team approach. This leads to the

influx of new ideas and methods to deal with problems that the organization may

face. In concluding his arguments, the author states that being able to effectively

manage "change" is the basic leadership requirement, and in this light, the manag-

er-as-developer is the most effective style.

Most people confuse leading with managing, or feel that the two terms are

synonymous. Leading is defined by Webster as the act of showing someone the

way, while managing is defined as influencing a person so that that person does

what the "manager" wants. The crucial word which clearly distinguishes between

the two is "influencing". Thomas Harris (1987) conducted a poll of randomly


28

selected non-Fortune 500 companies in the state of Indiana who had an annual

sales of at least $5,000,000. The CEOs or presidents of each company polled

were surveyed about situational leadership using Hershey and Blanchard's Leader

ship Effectiveness and Adaptability Description (LEAD). The results of the study

indicated that the managers favored a management style that was high task and

high relationship, and almost entirely neglecting the delegation of responsibility to

subordinates. The most interesting feature of the results is that although the

managers used a "hands on" style of management, their perception of themselves

was as a manager-as developer.

Wongruangwisan (1980) studied managerial leadership style and organiza

tional effectiveness by examining all privately owned manufacturing companies in

Bangkok which employed at least 1,000 persons (total size of the population which

met these criteria was 53). The random sample of 10 organizations was drawn

from this pool, and questionnaires were sent to each of the upper four levels of the

management, the top manager, the department manager, a supervisor, and three

workers (the supervisor and workers were randomly selected from each depart

ment within the company. The results of the study showed that the most common

type of management could be placed between the benevolent authoritative and

consultative. It was also found that the higher up in the organization a person

was, the more likely they were to practice participative management. Another

hypothesis examined by the study was that there was a positive relationship bet

ween the management system and the organizational effectiveness, which proved

to be true. The final hypothesis tested by this study was that there was a direct

relationship between the educational level of the department manager and the

organizational effectiveness. The null hypothesis was rejected because the ob


tained values did not exceed critical values, however, the very small difference

between the obtained and critical values indicated that additional research should

be conducted on the relationship between a department manager's educational

level and organizational effectiveness.

In 1982, Edward E. Lawler III, created a position paper on the relationship

between education, management style, and organizational effectiveness. One

study that was cited was a study of the educational levels of managers which

revealed that 49% of the managers who were under 40 had MBAs while only 16%

of the managers who were 50-59 had MBAs. Other points that were made

(supported by research) were that the more education an employee has, the more

likely they are to want participative management; there is little hard data on any

relationship between level of education and productivity; there is very little empir

ical research on organizations who have radically changed their style of manage

ment; there is little research on the effectiveness of high involvement systems

(participative management); and most arguments that favor a switch to participa

tive management rely heavily on comparative studies and on linking societal

change to work place change. His closing statements argue for more research in

the area of organizational effectiveness and productivity with a participative style

of management.

Summary

A review of the available literature shows that participative management is

not just one single, simple concept. Rather, it is an integration of at least six (6)

different, but related concepts, Leadership, Motivation, Communication, Goals,

Decision and Control.


Studies have been performed in a number of organizations, both private

and public, and in both the "for profit” and "non-profit" types. There have been

some studies that touched on the question of whether or not participative styles of

management increased actual efficiencies of the organization, but none of them

directly addressed this issue.

This study directly attempted to explore the issue of increased productivity

as a direct result of the use of participative styles of management.


CHAPTER m

DESIGN AND METHODOLOGY

Design of the Study

This study was designed to examine the relationship between the style of

management that an organization uses and its profitability, using Likert's Profile

of Organizational Characteristics (a standardized survey) to define the style of

management used and the Dun & Bradstreet financial rating of the organization to

help define profitability , the underlining premise being that a company with high

productivity is more likely to be profitable. The two terms (productivity and

profitable) are not interchangeable, because the ability to bring about a desired

outcome (productivity) is not the same as obtaining a financial gain or benefit

(profitable), since something can be productive without being profitable, such as

in the case of a child cleaning their room. A child cleaning their room will be

productive for the parent from a time management point of view, but will not

necessarily yield a financial gain for either the parent or the child. A number of

different variables were examined through the use of a demographic section that

was added to the Profile of Organizational Characteristics. The demographic

variables were included to help determine whether any differences in the man

agement style ratings between companies or between individuals within the

companies could be due to inconsistencies that were previously noted in earlier

research. The variables that were investigated are (a) the age of the top level

managers (Hypothesis HI); (b) the educational level of the top level managers

31


32

(Hypothesis I); (c) the sex of the top level managers (to determine if there is two

terms (productivity and profitable) are not interchangeable, because difference

between female and male responses); (d) the age of the organization (Hypothesis

II); and (e) the size of the organization in terms of both number of employees and

the number of buildings it uses (Hypothesis IV). The data used for the fifth

hypothesis were taken from the Dun & Bradstreet ratings and compared to the

organizational mean response on Likert's Profile of Organizational

Characteristics.

Participants in the Study

The participants in the study were all officers of organizations that manu

facture office furniture in the United States of America, taken from Dun & Brad

street's Million Dollar Directory, further identified by having an Standard Indus

trial Classification code of 2521 or 2522. A SIC Code of 2521 denotes a company

that produces metal office furniture while a SIC Code of 2522 is for organizations

that produce wood office furniture. These codes are by no means exclusive, and a

company could be registered under both. Financial data on the responding organi

zations was taken from the most recent Dun & Bradstreet ratings.

The protocol of this study was categorized as exempt by the Human Sub

jects Institutional Review Board (Appendix A).

Instrumentation

Each subject was sent a letter stating the purpose of the study (Appendix B)

along with a copy of a modified version of Likert's Profile of Organizational

Characteristics (POC - Appendix C). The survey assessed six key elements


(leadership, motivation, communication, decisions, goals, and control) used to

differentiate between exploitive, benevolent, consultative, and participative styles

of management. Demographic questions were added at the end of the survey to

help more fully characterize the responses received and test the hypotheses. These

questions included the number of full time employees, the number of work sites

(separate buildings, the age of the organization, the level of the respondent in the

organization, how many persons there were on the respondents level, the respon

dent's educational level, their sex and finally, their age.

Likert's Profile of Organizational Characteristics (POC), is comprised of

six sections, Leadership (questions 1-3), Motivation (4-6), Communication (7-

10), Decisions (11 and 12), Goals (13 and 14) and Control (15 and 16). Each of

these questions was compared not only to each of the nine demographic questions

and the two financial factors, but also to each other (Appendices E and F).

The POC currently has three different forms, Form J, Form S and a modi

fied version of Form S. A split half reliability on Forms J and S usually result in

values of +0.90 to + 0.96. This study used Form S, which has been in use since

1977 and in a great number of studies, a number of them performed by the Insti

tute for Social Research at the University of Michigan. J. M. Ketchel (1972), in a

doctoral dissertation study, examined management styles in 17 counties that

comprised the mid-Ohio Health Planning Federation. Ketchel received 158

completed responses from 16 different counties and correlated the mean total

scores for each county with the performance for that county. The correlation

between the POC mean score and the member rating of county effectiveness was

+0.83, while the correlation for POC mean score and member scaled expectancy

rating was +0.74.


34

There have been a number of studies conducted in Japan, Yugoslavia and

the United States, to name some of the better known studies, and in each case

there was a distinct difference between the scores on the POC and the dependent

variable, production output. In the Japanese studies (two were cited with numbers

for comparison purposes), a t test was performed to determine whether or not

there were significant differences in the styles between production units which

were doing well and production units which were not doing well. The results

showed a fobt of -7.56 with a fcril of 4.30 at the a = 0.05 level with two degrees of

freedom.

Basically, the high productivity plant had a style of management that was

different from the style of the low productivity plant, as measured by the POC.

The researchers concluded that since the plants used similar equipment, produced

the same product and were the same size, that at least in the plants studied, a

participative style of management was more conducive to productivity.

Collection of Data

Surveys were sent to the individuals identified in all organizations in the

United States with the SIC 2521 and/or 2522, identified in Dun & Bradstreet's

Million Dollar Directory. Each individual that the survey was sent to was as

signed a specific four digit identification code that appeared on the upper right

hand comer of the survey. The individuals who received the questionnaire were

asked to complete it within a two week period from date of receipt and return it

via the self addressed, stamped envelope (the assumption was made that it would

have taken no more than one week from date of mailing to receive the letter).

Sixty days after the initial letters were sent out, telephone calls were made to those


35

individuals who had not responded to the written request.

No more than two telephone calls were made to any listed individual. If

the individual indicated during the first call that they were not interested in filling

out the survey, they were thanked for their time and the conversation was ended.

If the person indicated that they had not received the survey, they were sent anoth

er survey. If the person indicated that they had received the survey but had not

gotten around to filling it out, they were asked to please complete it and return it

as soon as possible.

Only those individuals who stated that they were going to complete the

survey during the first telephone conversation received a second call, approximate

ly 30 days after the first call. No additional calls were made after the second

attempt, the assumption being that if a written request and two telephone calls

failed to get a response, another telephone call would likewise be ignored.

Analysis of Data

The responses were individually keyed into the computer, care being taken

to insure that members of the same organizations would be joined together for an

average organizational response in the final analyses. Means were calculated for

each question to determine whether or not there were any inconsistencies with

regards to previously reported studies involving the POC. Correlational analyses

were performed on each of the questions on the questionnaire. Due to the fact

that Factor 24 dealt with the sex of the respondent, point bi-serial correlations

were performed when there was a comparison between Factor 24 and any other

factor. Additional correlational analyses were performed utilizing the various

sections of the POC (leadership, motivation, communications, decisions, goals and


controls) with the various demographic questions to help determine whether or not

any of the subsections of the POC correlated with any of the demographic factors

better than the overall POC score. For each hypothesis, the null hypothesis was

expressed in terms of population values of the correlation coefficients equaling

zero, or symbolically represented as:

Ho: p(rho) = 0,

with a level of significance of a = 0.05 (two tailed test). Correlations were

considered only if their absolute value was equal to or exceeded 0.30, due to the

fact that a correlation of 0.30 will account for nearly 10% of the variance of the Y

variable when predicted from the X variable and is frequently used in the social

sciences as the lowest critical correlation that assumptions can be based on.

Hypothesis I

The higher the educational level of the organization's managers is, the

more likely they are to use a participative management style of management.

Within responding organization, the responses from each person respond

ing were averaged and the averages used in a Pearson Product Moment Correla

tion. A positive correlation greater than or equal to 0.30 between the educational

level of the organization's respondents and the score on the PCX! would indicate

that higher educational levels in managers result in an increased use of participa

tive management.

Hypothesis II

The older an organization is, the less likely they are to use a participative

style of management.


37



tion. A negative correlation less than or equal to -0.30 between the age of the

organization and the average score on the POC would indicate that younger

companies are more likely to use a participative type of management than older,

more established organizations.

Hypothesis III

The older the organization's managers are, the less likely they are to use a

participative style of management.



tion. A negative correlation less than -0.30 between the age of the managers and..x

the score on the POC would indicate that older manager's are less likely to use a


Hypothesis IV

Organizations who use a participative style of management are more likely

to be smaller in size than organizations who use a more rigid style of management.



tion. A negative correlation less than -0.30 between the size of the organization

and the score on the POC would indicate that smaller organizations are more

likely to use a participative style of management than larger organizations.


38

Hypothesis. .V

Organizations that use a participative style of management will have in

creased productivity that will result in increased financial stability as compared to

organizations that do not use a participative style of management.



tion. A positive correlation greater than 0.30 between the financial stability of the

organization and the score on the POC would indicate that a participative style of

management results in increased productivity which is translated into increased

financial stability. Productivity was defined in terms of financial stability for a

number of reasons, the most obvious being is that financial stability is something

that can be readily measured in discrete, objective units. Each company was rated

on a financial stability scale that was composed of two parts, yearly sales and a

financial rating from Dun & Bradstreet. Both of these factors were computed for

each responding company using a linear number conversion of the factors. A

number of previous studies using the POC have found that overall sales appears to

be positively correlated with a high score on the POC. Yearly sales of

$1,000,000 to $5,000,000 were assigned a point value of two, $6,000,000 to

$10,000,000 were assigned a value of four, $11,000,000 to $25,000,000 were

assigned a value of six, $26,000,000 to $50,000,000 were given a value of eight,

$51,000,000 to $100,000,000 were assigned a value of 10, and finally, any

companies with yearly sales greater than $100,000,000 were given a value of 12.

Dun & Bradstreet rates financial stability using a five point system, with

1A being the lowest rating and 5A being the highest. Each of these financial


39

stability ratings was doubled, resulting in the final financial stability rating being

two for 1A, four for 2A, six for 3A, eight for 4A and 10 for 3A.

The numbers obtained from both parts of the financial stability indicator

(yearly sales and the Dun & Bradstreet rating) were separately compared to the

POC average and they were also multiplied (yearly sales times Dun & Bradstreet

rating) and compared to the POC averages. The final results of the study were

analyzed using the factor obtained by multiplying the yearly sales by the Dun &

Bradstreet rating, increasing the spread between companies with sound financial

ratings and those with below average financial ratings.

Correlational analyses were performed on all variables, including the

following: averages of responses on questionnaire, age of organization, size of

organization (number of employees), number of different locations, type of

management style, age of top managers, educational level of top managers, and

sex of top managers. Additionally, correlational analyses were performed bet

ween the demographic variables to determine whether or not there were any other

demographic factors influencing the five hypotheses. The correlations were per

formed in order to determine whether or not any of the five hypotheses were true,

or rather if the null hypothesis for each of the five hypotheses could be false. The

critical value for rejecting the null hypothesis is approximately ± 0.156 (a =

0.05) for all hypotheses that do not involve the financial factors, annual sales,

current financial status (rating) from Dun & Bradstreet and financial stability

rating (Factors 27, 28 and 29). The critical value for rejecting the null hypothesis

for These factors is ± 0.201 (a = 0.05), due to the fact that there were fewer

degrees of freedom.


Summary

Each of the employees listed as part of the organization's management

team in the Million Dollar Directory within each of the targeted organizations was

sent a copy of the survey instrument, Likert's Profile of Organizational Character

istics (POC), that had been supplemented with nine demographic questions. Sixty

days after the surveys had been sent out, telephone contact was made with all of

those individuals who had not yet responded, and another survey form was sent to

them if they requested one.

The data that was received was analyzed using SPSS, Release 4.1, on an

IBM Model 3090-200E mainframe computer, located at Ferris State University,

Big Rapids, MI. Correlational analyses were performed on all 29 factors/ques

tion, consisting of 16 POC questions, nine demographic questions, a response

average of the 16 POC questions, and three different financial statistics (annual

sales, Dun & Bradstreet rating and a financial stability rating). A t test was per

formed for each of the hypotheses as well as a confidence interval for each of the

pertinent correlation coefficients.


CHAPTER IV

RESULTS

Introduction

The purpose of this study was to determine if using a participative style of

management would increase the productivity of an organization, thereby increas

ing its financial stability. Additionally, research was conducted to determine

what demographic factors had to be present in order for an organization to use a

participative style of management. Likert’s Profile of Organizational Characteris

tics, with a demographic survey added, was sent to all of the executives listed in

the Dun & Bradstreet Million Dollar Directory with a self-addressed, stamped

envelope for ease of return. The review of the literature in Chapter n outlined

the various components of what comprised a participative style of management

and how each of these components fits into the entire participative management

scenario.

The results of this study, all research hypotheses and other Endings of

interest, are presented in this chapter. Each of the hypotheses are presented in

the same order in which the were discussed in the Erst and second chapters.

673 surveys, complete with stamped, addressed return envelopes, were

mailed with sent to the executives listed in Dun & Bradstreet's Million Dollar

Directory, whose organizations had the SIC (Standard Industrial Classification) of

2521 or 2522. There were 138 initial responses to the survey. Follow up on

non-respondents occurred 60 days after the initial mailing by telephoning the

41


company and asking for the individual. During the telephone contact, each person

who had failed to respond to the initial request was asked if they had received the

survey and if they had, when would they be able to fill it out. In 18 cases, a

second survey was sent to the person who stated that they had not received it. An

additional 10 surveys were sent to individuals who had replaced the initial person

that the survey was originally sent to. 30 days after the first follow up telephone

calls, an additional 23 completed surveys were received. At this point, additional

telephone contact resulted in no additional surveys, with the exception of one

survey that was received 14 months after the initial mailings.

For the most part, surveys with low ratings were evenly distributed

through the return flow of the surveys. The only exception to this occurred at the

very end of the return period, after the first telephone contact, when two of the

lowest rated POCs were among the last four received.

A return rate of 24% is not particularly high. The most common reason

given for not returning the surveys in the time requested was that the person was

too busy. Other possible participants stated that they had not received the survey

or did not know where to return it. Finally, other potential respondents stated

that they did not fill out surveys.

Correlational analyses on were performed on component factors of the

POC to determine whether or not the POC was valid, in this instance, for the

variables being examined. Comparisons between the various factors have been

performed in other studies and the results from this study compare favorably to

similar correlational analyses performed in other studies between the various

components of the POC. Null hypotheses were constructed for the five hypothes

es under examination in the study, using a = 0.05, as follows:


43

Ho: p(rho) = 0 (a = 0.05)

A t test for independent means was used to test the existence of a relationship

between the level of education of the organizations's managers, the managers'

ages, the size and age of the organization and the organization's financial stability

and the style of management used by each responding organization. The null

hypotheses (Ho) were:

1. There will be no difference in the educational levels of the mangers

who use a participative style of management and the managers who do not use a


2. There will be no differences in the ages between organizations that

use a participative style of management and organizations that do not use a partici

pative style of management.

3. There will be no difference in age between managers who use a

participative style of management and managers who do not use a participative


4. There will be no difference in size between organizations that use

participative management and organizations that do not use a participative style of

management.

5. There will be no difference in financial stability between organiza

tions that use participative management and organizations that do not use participa

tive management.

Chapter IV consists of the following major sections: demographic charac

teristics of the sample, correlational analyses, female-male response analyses,

hypotheses testing and summary.


44

Demographic Characteristics of the Sample

Likert's Profile of Organizational Characteristics (POC), as stated in

Chapter m , contains 16 questions that relate to each other within specific group

ings that help define management style. An additional nine questions concerned

with the demographics of the respondent population were added at the end of the

POC. Ihble 1 includes the information related to the demographic parameters of

the respondents.

Thblel

Demographic Characteristics of the Respondent Sample

Factor Female Male Average

Age of Respondent 41-45 46-50 46-50

Education 2.9 3.3 3.3

Level 1 Employee 6 65 71*

% Level 1 40.0% 44.2% 43.9%

Level 2 Employee 9 82 91*

% Level 2 60.0% 55.8% 56.2%

Response Average 4.83 5.44 5.39

Level I Females 5.68 . . . . . .

Level II Females 4.32 ------ ------

# of Employees 151-250 500+ 500+

# of Buildings 3 9 8

Age of Organization 31-40 36-45 36-45

Organizational Sales Average

* Total

$40MM $65MM $60MM


Approximately 9.3% of the respondents were female, with an average age

somewhere between 41 and 45, and had slightly less than four years of college.

By contrast, the male population had an average age of somewhere between 46

and 50, with slightly more than four years of college. The organizations that

females worked in tended to be smaller (151-250 employees in 3 buildings) than

their average male executive (500+ employees in an average of 9 buildings). The

overall response average for females was 4.83 while for males it was 5.44.

During the inputting of the data, it was noted that in a number of cases, female

respondents appeared have lower average response ratings than males within the

same organization. An analysis was then performed to determine if there was a

relationship between sex and low responses on the POC. A t test was run on the

grand mean for the females as compared to the grand mean for the males, to

determine whether or not the mean of the females could be a subset of the entire

study population. This can be symbolically stated as

Ho: n = 5.39 (a = 0.05)

The results were t = -1.944 and tcv = -2.145. The null hypothesis was not re

jected at the a = 0.05 level.

Although the null hypothesis was not rejected, further examinations were

performed by separating the response averages for Level I and Level II females.

Level I positions are those top executive positions that hold the title of CEO,

president, etc., while Level II positions are typically vice presidents, department

managers, plant managers, etc. At this point the decision was made to separate

out the females who were in organizations with a Level I female and those female

respondents who were in organizations where there were no Level I females. The

means for the two groups were 5.7 and 4.3, respectively. Separate t tests were


performed for each of the two means resulting in the following null hypotheses:

Level 1 Female Present

Hypothesis: There will be no difference in the means between females

who are in an organization with a Level I female and the male response average.

This null hypothesis was represented as:

Hq: n = 5.39 (a =0.10)

The results were t = -0.782 and tev = ± 1.860. The null hypothesis not

rejected, that is, the obtained t value of -0.782 does not exceed the tn value of

-1.860. In other words, there is no appreciable difference between the male

response average and the female response average of females in organizations

where there is a Level I female (a female holds the top executive office).

Level 1 Female Not Present

Hypothesis: There will be no difference in the means between females

who are in an organization with a Level I male and the male response average.

This null hypothesis was represented as:

Ho: n = 5.39 (a = 0.10)

The results were t = -5.012 and tcv = -2.015. The null hypothesis is re

jected due to the fact that the obtained t value of -5.0122 exceeds the t value of«i cv

-2.015.

It appears that females who are in organizations that do not have a female

in a top level position (CEO, president, etc.) responded with lower ratings on the

POC than companies who had a female in the top level (Level I).


Analyses Results

47

The correlations between the 16 questions of the POC and the sub-factor

average (Factor 26) ranged from 0.63 to 0.78 (see Thble 2).

Thble 2

Comparison Between POC Sub-Factors and Sub-Factor Average (Factor 26)

Sub-Factor Number Sub-Factor Type Correlation

1 Leadership 0.75

2 Leadership 0.71

3 Leadership 0.71

4 Motivation 0.66

5 Motivation 0.66

6 Motivation 0.77

7 Communication 0.66




11 Decision 0.74

12 Decision 0.78

13 Goals 0.75

14 Goals 0.67

15 Control 0.69

16 Control 0.72


48

Factor 26 is an average of each individual's responses to all of the 16 POC

questions, therefore, there should be a high correlation between the individual

responses and the average of these responses. The primary purpose of performing

these correlations was to check and insure the reliability and validity of the data

gathered. The correlations between the various individual sub-factors ranged

between 0.30 and 0.71 (Appendix D).

Additional correlational analyses were performed between the various

sections (an average was taken of each of the sub-factor groups and the groups

were compares to each other) of the POC, Leadership, Motivation, Communica

tion, Goals, Decision and Control and the results are shown in Ihble 3.

Thble 3

Correlations Between POC Factors

1st POC Factor 2nd POC Factor Correlation

Leadership Motivation 0.70

Leadership Communication 0.63

Leadership Decision 0.64

Leadership Goals 0.63

Leadership Control 0.65

Motivation Communication 0.69

Motivation Decision 0.62

Motivation Goals 0.68

Motivation Control 0.65

Communication Decision 0.69


49

Thble 3 - Continued

1st POC Factor 2nd POC Factor Correlation

Communication Goals 0.68

Communication Control 0.61

Decision Goals 0.73

Decision Control 0.63

Goals Control 0.60

As can be readily seen in Table 3, there are very strong, positive relation

ships between the various POC factors.

There were a number of correlations between the various demographic

factors where it appeared that there was a relationship between the factors under

consideration, shown in Ihble 4.

Tible 4

Correlations Between Demographic Factors Exceeding 0.29

1st Demographic Factor

2nd Demographic Factor Correlation

it of Employees if of Work Sites 0.59

# of Employees it of Employees on Respondent's Level

0.35

# of Employees ft of Employees on Tap Two Levels

0.46

# of Employees Annual Sales 0.73

# of Employees Financial Stability 0.61


50

Ihble 4 - Continued

1st Demographic Factor

2nd Demographic Factor Correlation

tt of Sites Annual Sales 0.44

it of Sites Financial Stability 0.39

Organization's Age Financial Stability 0.41

Respondent's Level Respondent's Sex 0.30*

it of Employees on Respondent's Level

it of Employees on Top Two Levels

0.79

if of Employees on Respondent's Level

Financial Stability 0.41

it of Employees on Tbp Two Levels

Financial Stability 0.36

* Performed using a point bi-serial correlation

It is logical that there were fairly high correlations between the factors

dealing with number of employees, work sites and age of the organization since

the more employees a company has the more work space it needs to provide and

as a company gets older, it expands and grows, requiring more employees.

It is also understandable that there should be a high correlation between the

number of employees on the respondent's level and the number of employees on

the top two levels of management. Since there are more lower level (2nd echelon)

employees than upper level employees, they make up the greatest percentage of

the number of employees on the top two levels. Therefore, the correlation bet-


51

ween the total number of employees and a part of the total should be high since

there is approximately 80% of the total number of upper level employees are on

the 2nd level rather than the first.

There were some correlations that dealt with financial stability that had

high values and are shown in Thble 5.

Thble 5

Correlations Within Financial Data

1st Demographic 2nd DemographicFactor Factor Correlation

Yearly Sales D&B Rating 0.34

Yearly Sales Financial Stability 0.81

D&B Rating Financial Stability 0.81

The reason for the high correlations between the financial stability rating

and the yearly sales and the financial stability rating and Dun & Bradstreet rating

is that the yearly sales multiplied by the Dun & Bradstreet rating is the financial

stability rating, therefore, there would be a high correlation between the whole

and its parts.

A final set of correlational analyses were performed between the demo

graphic data and the POC factors, Leadership, Motivation, Communication,

Goals, Decision and Control. Of the 96 different correlations, only six correla

tions showed a relationship with a correlation value of 0.30 or greater, and these

were the averages of the various factors with Factor 26, which was the response

average for all factors. This would be of note only if the correlations were not


52

significant since there should be high correlations between the various parts and an

average of those parts.

A majority of the correlations between the POC sub-factors, Factor 26 (the

overall response average) and the demographic data were less than 0.30. In each

case where the correlation was less than 0.30, indicating a relatively weak associa

tion, the relationships were not examined any further (Appendix E - copy of the

original computer data printout in found in Appendix F).

Results of Hypothesis I

The higher the educational level of the organization's managers is, the

more likely they are to use a participative management style of management. The

operational hypothesis for this can be stated symbolically as,

H: p 4= 0 (a = 0.05).

The null hypothesis for this can be stated symbolically as,

Ho: p = 0 (a = 0.05),

where p is the population value of the correlation coefficient between the variables

of educational level of the managers and the type of management style used.

The results of the correlation between the educational level of the managers

and the likelihood of using participative management is 0.063. Testing the hy

pothesis using Student's t distribution, we obtain the following result,

t = 0.063 y[ (162-2)/(l-(0.0040)J = 0.798

The critical values for t for a = 0.05 is ±1.97. Since the test statistic of

0.798 is found within the limits of the critical value, the null hypothesis is not

rejected. The confidence interval was (-1.97, 1.97).

Since the critical value for the correlation coefficient is ±0.156 (a = 0.05)


and the correlation is 0.063, the null hypothesis, that the correlation would be

zero, is again, not rejected.

The interpretation of this is that no conclusion can be drawn as to whether

or not there is a relationship between the educational level of the managers and

whether or not the organization uses a participative form of management.

Results of Hypothesis n

The older an organization is, the less likely it is to use a participative style

of management. The operational hypothesis for this can be stated symbolically as,

H: p =H 0 (a = 0.05).


Ho: p = 0 (a = 0.05)


of the age of the organization and the type of management style used.

The results of the correlation between the age of the organization and the

likelihood of using participative management is 0.018. Testing the hypothesis

using Student's t distribution, we obtain the following result,

t = 0.018 yf (162-2)/(l-(0.0.0003)s = 0.228

The critical values for / for a = 0.05 is ±1.98. Since the test statistic of

0.2.28 is found within the limits of the confidence interval, the null hypothesis is

not rejected. The confidence interval was (-1.98, 1.98).

Since the critical value for the correlation coefficient is approximately

±0.156 (a = 0.05) and the correlation is 0.018, the null hypothesis, that the

correlation would be zero, is again, not rejected.



or not there is a relationship between the age of an organization and whether or

not the organization uses a participative form of management.

Results of Hypothesis m

The older the organization's managers are, the less likely they are to use a

participative style of management. The operational hypothesis for this can be

stated symbolically as,

H:p =|= 0 (“ = 0.05).


Ho: p = 0 (a = 0.05)

where p is the population value of the correlation

coefficient between the variables of the age of the organization's managers and the

type of management style used.

The results of the correlation between the age of the organization's manag

ers and the likelihood of using participative management is 0.104. Testing the

hypothesis using Student's t distribution, we obtain the following result,

t = 0.104 yf(162-2)/(l-(0.0.0108)2 = 1.323

The critical values for r for a = 0.05 is ±1.98. Since the test statistic of

0.228 is found within the limits of the confidence interval, the null hypothesis is

not rejected. The confidence interval was (-1.98, 1.98).

The critical value for the correlation coefficient is approximately ± 0.156

(a = 0.05) and the correlation is 0.018, the null hypothesis, that the correlation

would be zero, is again not rejected.


or not there is a relationship between the age of an organization and whether or


not the organization uses a participative form of management.

55

Results of Hypothesis IV


to be smaller in size than organizations who use a more rigid style of management.

The operational hypothesis for this can be stated symbolically as,

H :p =|= 0 (ot = 0.05).

The null hypothesis for this can be symbolically stated as

Ho: p = 0 (a = 0.05)


of size of the organization and the type of management style used.

The results of the correlation between the size of the organization and the

likelihood of using participative management is 0.161. Testing the hypothesis

using Student's t distribution, we obtain the following result,

t = 0.161 yf(162-2)/(1-(0.0259)* = 2.063

The critical values for t for a = 0.05 is ±1.98. Since the test statistic of

2.063 is not found within the limits of the critical value, the null hypothesis is

rejected. The confidence interval was (-1.98, 1.98).

The critical value for the correlation coefficient is approximately ±0.156

(a = 0.05) and since the correlation is 0.161, the null hypothesis, that the correla

tion would be zero, is rejected.

The interpretation of this is that there is a relationship between the size of

the organization and whether or not the organization uses a participative form of

management. Interestingly, although the null hypothesis was rejected, the direc

tion of the correlation was positive while the initial hypothesis would have yielded


56

a negative correlation, had it been true, between the size of the organization and

use of participative management. It appears therefore, that the size of the organi

zation does make a difference in whether or not it uses a participative form of

management, but participative management appears to be used more in larger

rather than smaller organizations.

Results of Hypothesis V


creased productivity that will result in increased financial stability. The operation

al hypothesis for this can be stated symbolically as,

H:p =|= 0 (a = 0.05).

The null hypothesis for this can be symbolically stated as

Ho: p = 0 (a = 0.05)


of increased productivity, as defined by increased financial stability and the type

of management style used.

The results of the correlation between the financial stability of the organi

zation and the use of a participative style of management is 0.138. Testing the

hypothesis using Student's t distribution, we obtain the following result,

t = 0.138 yf(96-2)/(l-(0.0190)2 = 1.351

The critical values for t for a = 0.05 is ±1.98, which yields a confidence

interval of (-1.98, 1.98). Since the test statistic of 1.351 is found within the limits

of the critical value, the null hypothesis is not rejected.

The critical value for the correlation coefficient is approximately ±0.156

(a = 0.05) and since the correlation is 0.138, the null hypothesis, that the correla-


57

tion would be zero, is again, not rejected.


or not there is a relationship between the financial stability of an organization and

whether or not the organization uses a participative form of management.

Summary

162 surveys were received back out of 677 sent, or a return rate of 24%,

and 91 of the responses came from companies where financial data was available,

or 13.4% of the total surveys sent out. 9.9 % of the 91 respondents were female

with an average age of 41-46 with an average educational level of 3-4 years of

college, while their male counterparts were 46-50 years old with just over 4 years

of college.

A closer examination of the difference between the average response given

by females and males revealed that females who worked in an organization where

there was a female in the top executive position rated the management style very

similar to their male colleagues whereas females who worked in organizations

where a male held the top executive position rated the organization's style of

management as being much more restrictive than their male colleagues.

An correlational analysis between the POC sub-factors with the average

response of the POC (an average of all of the sub-factors) showed correlations of

0.63 to 0.79. An additional analysis was performed between the various factors of

the POC, Leadership, Motivation, Communication, Goals, Decision and Control.

These correlations ranged from 0.60 to 0.73.

A correlational analysis was executed on the demographic information and

it was found that there were a number of correlations within the collected informa


tion that showed a definite relationship between the variables. Most of these relat

ed variables were concerned with the size, age and financial stability of the organ

ization. The financial correlations, dealing with yearly sales and Dun & Brad

street ratings, ranged from 0.34 to 0.81.

No support was shown for Hypotheses I, II, m and V, that is, this study

showed no discernible relationship between:

1. The educational level of the organizations's managers and the like

lihood of using a participative style of management.

2. The age of an organization and the likelihood of using a participa

tive style of management.

3. The age of the managers and the likelihood of using a participative


5. Whether using a participative style of management causes an in

crease in financial stability.

The fourth hypothesis "Organizations who use a participative style of

management are more likely to be smaller in size than organizations who use a

rigid style of management" did show a positive relationship. Unfortunately,

though, in order to fulfill the requirements of the hypothesis, the result should

have been negative correlation, that is, the smaller organizations should have been

more likely to use a participative style of management. A positive correlation

means that the larger an organization is, the more likely it is to use a participative

style of management, the exact opposite of what was proposed in Hypothesis IV.


CHAPTER V

CONCLUSIONS AND RECOMMENDATIONS

Conclusions

Optimal productivity is the goal of every "for-profit" organization.

Optimal productivity can be gained through the use of a number of different ele

ments, including technologically advanced machinery, increased computer usage,

redesigning work station flow and advanced management methods, to name a

few.

One of the "new" management techniques is participative management,

where everyone in the organization has some input into the decisions made. The

advantages of participative management are obvious, you get input not only from

the management side, but also from the workers, the employees who will be

performing the work. This group of people know the actual production operation

inside and out and are able to give additional insight that may not be readily

apparent from casual observation.

Participative management also has problems, especially in its inception.

Most managers in established organizations tend to continue running the organiza

tion as it had been run, following the axiom "If it ain't broke, don't fix it". Some

of these managers are not easily able to relinquish the control that they have, and

participative management requires that everyone share the responsibilities and

decisions, although not necessarily on the same level.

Adherents of participative management strongly support the concept being

59


60

have flaws in how they portray their point of view and that of their opponents.

The review of literature examined a number of organizations, both private

and public non-profit and "for profit" organizations, and their attempt to integrate

some, if not all, of the elements of participative management into their organiza

tion's management structure. The general consensus of the studies was that par

ticipative styles of management help increase the efficiency of the organization,

although actual "pre" and "post" implementation measurements of efficiency were

not performed, therefore the most that can be said is that the use of participative

management leads to better working conditions, in the opinion of the employees

of the organizations about whom the articles were written.

Response Rate

The low response rate occurred for a number of different reasons that were

listed earlier. The most likely reason that the surveys were not completed was that

there was no "buy in" for the participants. It did not directly affect them since

they were not involved other than filling out a questionnaire, it therefore gave

little or no value for the time involved. Future studies of this nature might fare

better if concentration were focused on a smaller number of companies, and these

companies were visited in person. This would cause a face to be attached to the

questionnaire which would allow the respondent to feel as though they were a

bigger part of the project rather than just a set of numbers for another "college

study".


Correlational Analyses

As stated previously, the correlations did not reveal any startling facts nor

do they lead to any startling conclusions. There were a number of high correla

tions, however, since most of these correlations were measuring the same proper

ty, it would therefore stand to reason that they would correlate fairly well with

themselves or similar factors. The correlations between sex and number of

employees in the organization (0.18) and sex and the respondent's level in the

organization (0.27) were calculated using a point bi-serial correlation because sex

only has two conditions, female or male.

The correlations between number of employees and the number of work

sites (0.59), the number of employees and number of employees on the respon

dent's level (0.35), the number of employees and number of employees in the top

two levels of the company (0.46), the number of employees and annual sales

((0.73), number of employees and financial stability rating (0.61) are obviously

going to be high due to the fact that Factor (Question) 17 asks for the total

number of employees in the company. Each of the factors that correlate highly

with Factor 17 (the number of employees) are concerned in some way with size

of the organization or the logical results that occur as an organization increases in

size. As an organization grows larger, there is an increase in the number of

buildings occupied (Factor 18), more managers (Factors 21 and 22) to run the

organization and the larger the organization the greater the annual sales (Factor

27). The financial stability rating (Factor 29) is a direct product of the annual

sales (Factor 27) and the organization's current financial status, as appraised by

Dun & Bradstreet (Factor 28), so if the correlation between the number of

employees and annual sales is high, then the correlation between the number of


employees and the financial stability rating will also be high.

The correlations between the number of work sites and annual sales

(0.44), the number of work sites and the financial stability rating (0.39) are high

due primarily to the same reasons that the correlations involving the number of

employees are high, larger organizations have larger infrastructures.

The correlations involving the organization's age and financial stability

rating (0.41)) are also significant for the same reasons that were stated earlier in

the analysis of factors involving the number of employees and the number of work

sites, that is, as organizations grow older, they usually get larger, with more

employees and more work sites.

The high correlation between number of employees on the respondent's

level and number of employees on the top two levels of management (0.79) is

clearly due to the fact that they are both measuring the number of members in

each of the two top levels of the organization. Obviously, there will always be

either the same or more total employees in the top two levels of the organization

than there will be in either of the component levels (the sum is equal to the total

of its parts).

The correlation between the number of employees on respondent's level

and the yearly sales (0.32) is easily explained by the fact that companies with

greater sales volumes are usually larger companies and have more top level

managers.

The final correlations examined were between the yearly sales and the

Dun & Bradstreet rating) (0.34), the yearly sales and the financial stability rating

(0.81), and the Dun & Bradstreet rating and the financial stability rating (0.81).

Basically, the correlation between the yearly sales and the Dun & Bradstreet rating


shows that the companies who have greater sales volumes are more likely to be

financially secure. This again is a fairly obvious and logical observation. The

correlations between the financial stability rating and the yearly sales and the Dun

& Bradstreet rating are high due to the fact that the financial stability rating is the

product of the numerical values of the annual sales and the Dun & Bradstreet

rating, therefore there would be a direct, positive relationship between the size or

size increase in either of those factors and an increase in the final product.

The correlations between the various parts of the POC correlate rather

highly with themselves, that is, each of the different subsections of the POC are

highly correlated with the other subsections. Although these high correlations

have little bearing on the hypotheses examined in this study, it is important to

note because if the subsections did not correlate well, the entire instrument would

be suspect as a valid measure of management styles.

There were t tests performed on the averages of the responses based on sex

of the respondent, to determine whether or not the response mean of the females

could be part of the sample mean. The first t test was performed to see whether

or not the response averages from females were could be contained within the

sample averages. The null hypothesis (that there was no difference between

female and male response averages) was not rejected , so the females responses

were split into two different averages, those with a female in a Level 1 position

and those without a female in a Level 1 position. It was found that those females

with a female in a Level 1 position had an average that was slightly higher than

the overall population average. It was also found, though, that females in organi

zations where there was not a Level 1 female had response averages that were

well outside critical limits. In other words, females in organizations where there


were no upper level management females did not see the organization's style of

management in the same light as their male counterparts in the same organization.

This could be interpreted in any number of different ways, but the most

likely interpretation is that there is sexual bias within the organizations polled.

Females who were Level 2 employees within an organization where there was a

Level 1 female employee gave the highest responses for females to the question

naire. At the same time, Level 2 females within organizations with Level 1 males

were more likely to give responses lower than their male colleagues to the POC.

Hypotheses

Four out of five hypotheses that were tested did not prove out, and the one

that did actually resulted in the opposite conclusion from what was originally

stated. There are a number of reasons that this could have occurred that the

hypotheses could have failed. The possible reasons will be discussed for each

hypothesis.

Hypothesis I

The higher the educational level of the organization's management is, the

more likely it is to use a participative style of management.

The basic assumption that was made when this hypothesis was developed

was that participative management techniques are discussed and taught in upper

level college courses, therefore, it is logical to expect that the more higher educa

tion a person has pursued, the more likely it is that they would have been exposed

to the concepts of participative management. One of the most obvious fallacies of

this logic is that participative management has become a very common topic in


numerous magazines and in many "mini" seminars around the country. Manage

ment experts often point to the Japanese, as models for consensus building, as an

example of participative management at work.

It no longer, therefore, is the case that it is necessary for a person to take

higher level college courses in order to learn about participative management.

Hypothesis II

The older an organization is, the less likely it is to use a participative style

of management. The underlying assumption here was, again, that in order to

learn about participative management, it would be necessary to take advanced

level college courses. Older managers would have taken advanced college level

courses when the theory of participative management was considered to be a "pipe

dream" and something of little or no consequence. Once again, the surprising

dominance of the Japanese in the world marketplace caused the concepts of partic

ipative management to be re-considered in a different light, spawning an avid

desire to know what the Japanese knew and what we did not..Is 1

Hypothesis III

The older an organization's managers are, the less likely they are to use a

participative style of management. The basic management philosophies taught in

the from the early 1900's until the early to mid 1980's were based on Frederick

Thylor and the other early industrial engineers. These philosophies stressed a

"one-man" operation, run from the top down, just like a military unit is run.

The primary job of top management was to make decisions and pass them down to

the middle management for implementation. The middle managers were responsi


ble to oversee the actual operations and the job of the shop or floor employees was

to perform the work. Good ideas were encouraged from the ranks primarily

through monetary incentives and company recognition. The original conjecture

that formed the base of Hypothesis II was that the older the managers were, the

more likely it was that the fundamental management style that they were taught

was the "top down” model. A item to consider at this point is that the response

average for the entire sample that was used was 5.39 out of a total scale that

ranged from one to eight. This actually puts the response average in the consulta

tive management style rather than in a true participative management style. It is,

therefore, conceivable that although the null hypothesis was not rejected, that the

"top down” model did and still does influence upper management behavior, result

ing in a lower response average.

Hypothesis IV


to be smaller in size than organizations who use a rigid style of management.

The null hypothesis was rejected, unfortunately, in order for the original hypothe

sis to be true, the resulting analyses would have to have been numerically nega

tive, that is, if smaller organizations were indeed more likely to use a participa

tive style of management than larger organizations, a numerical decrease in the

size of the organization would have been accompanied by a numerical increase in

the response average on the POC. Instead, the was a increase in the response

average as the organizations grew larger.

There is no logical explanation for this phenomenon, especially since the

number of large, small and medium organizations was equally distributed through


out the returned responses. At this time, the reason for this result is unknown. It

is unclear whether this is an actual cause and effect relationship or just an anoma

ly.

Hypothesis V


creased productivity that will result in increased financial stability. In order to

define what effects should be visible in organizations that use participative forms

for management, a number of financial experts were consulted. The general

consensus of the experts was that if an organization was performing efficiently,

its financial stability and annual sales would be the first measurable items that

would be affected. It was also decided to multiply the two items together, thus

enhancing the effects of both good and bad performance by organizations. The

biggest problem was that it appeared that all organizations were using similar

styles of management, as evidenced by the homogeneity of the response averages

for each organization.

Recommendations

The null hypotheses for Hypotheses I, II, III and V were not rejected.

This does not necessarily mean that there is no effect, but rather that whatever

effect that it had was not measurable against background noise. One of the prob

lems is that the instrument is self-administered. This can cause several concerns,

including whether or not the respondent thought or was apprehensive about the

possibility of their answers be available to their superiors. Although the respond

ents were assured that their answers would remain anonymous, if the organization


style leaned towards the exploitative or even the benevolent style of management,

this could have caused anxiety about answering truthfully.

Another problem with self administered instruments is the fact of interpre

tation of what any particular phrase means. Some people will view an benevolent

style of management as an enlightened way of doing business while others will

view it as a return to the "sweat shops" of the early 1900s. This was seen many

times in the results that were received, particularly in one case where two re

spondents of the same sex, had very similar responses, indicating, by the pattern

of their answers, that the organization was definitely using the participative style

of management. The third respondent from the same organization was of a dif

ferent sex and from their perspective, the style was just short of whips and

chains, with a large number of negative responses.

Another problem may be that the tool used to measure financial stability

may not have been sensitive enough to measure actual differences in worth.

Although the financial ratings of institutions such as Dun & Bradstreet are used

every day to make major, crucial decisions in the business world, these indicators

may not be discriminating enough to help discern between the differences in a

strong market competitor who uses an exploitative style of management and a

strong market competitor who uses a more participative style of management.

It could also be that the tool was not measuring an appropriate co-variant.

As stated previously, one of the assumptions that was being examined is that a

participative style of management increases productivity and increased productivi

ty results in an organization that has increased financial stability. There are

however, other factors that can affect an organization's financial stability, includ

ing currency exchange rates, interest rates, product diversification and so on. At


69

this point, it is doubtful that there is any financial co-variant that could be used to

measure the true effect of a participative style of management on an organization's

productivity.

Study Format Changes

In order to accurately gauge the effect of a participative style of manage

ment and its effects on productivity, it will be necessary to actually go into the

organizations under study and take productivity measurements, or obtain valid

historical measurements that track productivity over time with care taken to

insure that other competing variables are not influencing any productivity chang

es, such as the introduction of gain sharing or profit sharing plans or the change

from a non-union to a union environment or the visa versa.

Since the null hypothesis of one of the hypotheses (Hypothesis IV),

"Organizations who use a participative style of management are more likely to be

smaller in size than organizations who use a more rigid style of management", was

rejected, then it can be inferred that larger organizations are more likely to use a

participative style of management. It would make any future study of this subject

more valid if comparisons of style were performed on subject organizations that

were closely matched on size and other physical characteristics. The only variable

that would differ between the individual members of matched pairs would be their

ratings on their style of management, with each organization have distinctly differ

ent styles of management.

Part of the study would also involve measurement of the management

style, but do to the interfering factors that were mentioned earlier, it would be

advantageous for the researcher to conduct all analyses of the management style


70

rather than rely on self administration.

Summary

Although the study did produce some interesting data and insights into the

use of participative management in organizations, there were some flaws.

In order to correct the flaws in the study, it is recommended that for

future studies, the analysis of the organization's style of management be per

formed by one person rather than relying on individuals within the organization to

complete the questionnaire themselves.

The second recommendation would be to match organizations on the basis

of their physical characteristics, that is, size, number of employees, annual sales,

etc., and then assess their efficiency and what style of management they use.

The third and final recommendation is that the study use data from within

each organization on actual efficiencies to determine whether or not a participa

tive style of management would be conducive to increased efficiencies over other

styles of management.


Appendix A

Protocol Clearance From the Human Subjects Institutional Review Board

71


W e s t e r n M ic h ig a n U n iv e r s it y

72

Date: January 6, 1991

To: Mike Swearingen

From: Mary Anne Bunda, Chair M o - v y & n r \ e

Re: HSIRB Project Number: 91-12-25

This letter will serve a s confirmation that your research protocol, "Participative management and productivity partners or adversaries" has been approved under the fiaampi category of review by the HSIRB. The conditions and duration of this approval are specified in the Policies of W estern Michigan University. You may now begin to implement the research as described in the approval application.

You must seek reapproval for any changes in this design. You must also seek reapproval if the project extends beyond the termination date.

The Board wishes you success in the pursuit of your research goals.

xc: Smidchens, Edld

Approval Termination: January 6, 1993


Appendix B

Cover Letter Sent to Participants

73


74

Dear John Doe:

I am a doctoral candidate at Western Michigan University, in the Department of Educational Leadership, and am currently conducting research into the relationship between management styles and organizational success in industry.

I would appreciate your help in completing this study. Please complete the enclosed survey (no more than 5-7 minutes), and return it in the stamped, addressed envelope.

Each survey form is identified in the upper right hand corner with an identification number. This number will be used only to help group responses from the same company. Once the responses have been grouped, the identification number will be removed from the survey forms.

Please feel free to call me at (616) 796-4858, if you have any questions. An abstract will be sent to all companies whose management responds. Copies of the final results and an executive summary will be available upon completion of the study, and may be obtained by writing to:

Michael H. Swearingen C/0 Dr. U. Smidchens

Western Michigan University Dept, of Educational Leadership

Kalamazoo, MI 49002

I would like to thank you in advance for your time and effort in helping me with this study.

Sincerely,

Michael H. Swearingen Dr. Uldis SmidchensDoctoral Committee Chairman


Appendix C

Profile of Organizational Characteristics and Demographic Survey

75


76

Management Style Survey Number

This survey was developed to help people describe the type of management style their organization uses. It is important to remember that there is no right or wrong answer, so please answer each question the best you can. The answers that you give will be kept totally confidential.

Each question can be answered using an 8 point scale, as illustrated below:

Seldom 1 2

^ Occasionally Frequently Almost Always 8

If the question asks whether or not you feel that work is rewarded promptly and you felt that the answer was not "Almost Always”, but more than ‘Occasionally", then you would circle either 5 or 6, whichever number you felt was closer to what you feel the answer is.

Please be sure to complete questions, place the questionnaire into the self- addressed, stamped envelope and mail when you are finished.

This survey takes no more than 5-7 minutes to complete. Thank you for your cooperation. An abstract of the study will be sent to all parties that respond, and copies of the final results and an executive summary may be obtained by writing to:

Michael H. Swearingen C/O Dr. U. Smidchens

Western Michigan University Dept, of Educational Leadership

Kalamazoo, MI 49002LEADCTSHIP

1. How much confidence and tru s t isshown in subordinates?

2. How free do subordinates fee l tota lk to superiors about th e ir uork?

3. How often are subordinates' ideassought and used constructively?

Very l i t t l e 1 2Not free

1 2Seldom

1 2

Some

Somewhat free 3 4

Occasionally 3 4

Quite a b it 5 6

Quite free 5 6

Frequently 5 6

A very great deal 7 8

Very free 7 8

Almost Always 7 8

4. Is predominant use made o f: a) fear b) th rea ts , c) punishment,d) rewards, e) involvement?

5. Where is responsib ility f e l t for achieving high performance?

a ,b ,c and occasionally d

1 2Mostly a t top 1 2

H0TIVAT10Md withsome c

3 4

Top and middle 3 4

Mainly d with some c and e 5 6

Fairlywidespread 5 6

d and e, based on group se t goals

7 8

At a l l levels 7 8

6. How much cooperative teamwork exists?

Very l i t t l e 1 2

Some 3 4

Quite a b it 5 6

A great deal 7 8

7. What is the usual d irec tion of information flow?

COMMUCATICM

Top down Mostly down 1 2 3 4

Up and down 5 6

Up, down, and sideways

7 8

8. How is downward communication accepted?

With d is tru s t

1 2

Often with suspicion

3 4

Often accepted

5 6

Fully Accepted

7 8

9. How accurate is upward communication?

Usually Inaccurate

1 2

Occasionally Inaccurate

3 4

Often Accurate

5 6

Almost always Accurate

7 8

10. How well do superiors know the problems faced by subordinates?

Not well 1 2

Somewhat 3 4

Quite well 5 6

Very well 7 8


77

11.

DECISIONS

At what level are decisions made? Mostly a t top

1 2

Policy a t top, some delegation

3 4

General policy a t top, more

delegation 5 6

Widespread decision making, well coordinated

7 8

12. How often are subordinates involved Almost never in decisions re la ted to th e ir work? 1 2

Occasionally consulted 3 4

Generally Consulted 5 6

Fully Involved

7 8

13.

GOAISOrders, some By orders a f te r

How is goal se ttin g usually done? Orders issued comments discussion1 2 3 4 5 6

Generally by group discussion

7 8

14. How much do subordinates s t r iv e to Very l i t t l e Some Quite a b i t A great dealachieve organization 's goals? 1 2 3 4 5 6 7 8

15. How concentrated are review and control functions?

CONTROL

Very highly a t top

1 2

Highly a t top

3 4

Moderate delegation a t lower levels 5 6

Widely Shared

7 8

16. What are cost, p roductiv ity , and other control data used for?

Policing, punishment 1 2

Reward and punishment 3 4

Reward, some self-guidance 5 6

Group guidance & problem solving

7 8

DEMOGRAPHIC DATA

17. Total number of fu ll time employees? 1 -2 5 ___ 26-75 76-150 151-250 251-500 ________501-1000 ____ 1001-2000 _ 2001-5000 ___ 5001-10,000 ___ 10,001+___

18. Total number of employee work s i te s (separate buildings). Nunber ___

19. Number of years in business? 0-2____ 3-5__ 6-8__ 9-12___ 13-16____ 17-20__ 21-25___26-30 31-35 36-40 41-45 46-50 51-60 61-75 76-100 101+

20.

21.

22.

23.

24.

25.

Your level in your organization.a. 1st (CEO, presiden t, plant manager, managing d irec to r, e tc .)b. 2nd echelon (vice president, section manager, e tc .) ___

How many persons are there on your level? Number ____

How many persons are there in the top two levels of your organization? Nunber _____

Your educational level. High school _ _ A ssociate 's or some college ___ 4 year degree ___Graduate degree ____ S pecia list degree Doctoral degree M.D., O.D., D.V.M., e tc . ___

Your sex. Female Male

Your age. 18-25___ 26-30___ 31-35___ 36-40___ 41-45_55-60 61-65 66+

46-50 51-55

Thank you for the time you spent in f i l l in g out th is survey.


Appendix D

Correlational Analyses Results of POC Sub-Factors With POC Sub-Factors

78


79

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oin vo $ i i i i i i i 1 i i i io o o i i i i i i i 1 i i i i

voin CNVO i i i i i i i I I I i i Id o i i i i i i i S 1 I i i i

532 o00 2 pD zw o oQ o uII II II

HQ o u

vo• i i i i i i i i i i i i i i^ i i i i i i i i i i i i i i! ! ! ! ! ! ! ! ! ! ! i ! I !

j j j S S S u u u u q q o o u


Appendix E

List of POC and Demographic Survey Components

80


Question Definition

1 P.O.C. Leadership sub-factor



4 P.O.C. Motivation sub-factor



7 P.O.C. Communication sub-factor




11 P.O.C. Decision sub-factor

12 P.O.C. Decision sub-factor

13 P.O.C. Goals sub-factor

14 P.O.C. Goals sub-factor

15 P.O.C. Control sub-factor

16 P.O.C. Control sub-factor

17 Number of employees in respondent's organization

18 Number of buildings in respondent's organization

19 Organization's age

20 Respondent's organizational level

21 Number of employees on respondent's level

22 Number of employees in top two management levels

23 Respondent's educational attainment level

24 Respondent's gender

25 Respondent's age

26 Average of responses to Questions 1-16

27 Annual sales from Dun & Bradstreet

28 Current financial status from Dun & Bradstreet

29 Financial stability rating


Appendix F

Summary Table of Correlational Analyses

82


Reproduced

with perm

ission of the

copyright ow

ner. Further

reproduction prohibited

without

permission.

t

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29

1 _ 0.61 0.56 0.50 0.46 0.53 0.43 0.43 0.43 0.44 0.54 0.50 0.50 0.49 0.47 0.49 0.18 0.21 0.03 0.15 0.12 0.05 0.04 0.15 0.00 0.75 0.18 0.06 0.072 - - 0.62 0.46 0.33 0.57 0.33 0.43 0.40 0.51 0.45 0.52 0.51 0.35 0.48 0.52 0.18 0.23 0.00 0.08 0.05 0.03 0.07 0.20 0.03 0.71 0.13 0.14 0.033 - - - 0.47 0.47 0.53 0.33 0.45 0.34 0.42 0.42 0.57 0.52 0.35 0.44 0.50 0.18 0.11 0.01 0.01 0.18 0.10 0.01 0.18 0.10 0.71 0.20 0.06 0.104 - - - - 0.30 0.48 0.41 0.38 0.39 0.33 0.35 0.44 0.51 0.32 0.39 0.55 0.07 0.12 0.08 0.04 0.14 0.08 0.02 0.10 0.06 0.66 0.15 0.01 0.085 - - - - - 0.53 0.46 0.40 0.43 0.27 0.47 0.42 0.36 0.57 0.41 0.35 0.12 0.02 0.09 0.02 0.02 0.03 0.01 0.16 0.10 0.66 0.19 0.14 0.206 - - - - - - 0.49 0.47 0.47 0.50 0.51 0.54 0.48 0.51 0.49 0.57 0.15 0.10 0.05 0.14 0.02 0.07 0.00 0.17 0.20 0.77 0.18 0.08 0.197 - - — — - - - 0.48 0.40 0.31 0.48 0.42 0.49 0.47 0.47 0.36 0.03 0.01 0.01 0.06 0.01 0.09 0.04 0.11 0.07 0.66 0.06 0.03 0.018 - - - — - - - - 0.43 0.49 0.47 0.51 0.42 0.49 0.36 0.44 0.02 0.08 0.13 0.08 0.06 0.01 0.09 0.04 0.11 0.07 0.06 0.02 0.009 - - - — - - - - - 0.49 0.45 0.48 0.41 0.40 0..8 034 0.14 0.20 0.03 0.09 0.01 0.05 0.07 0.10 0.02 0.63 0.10 0.11 0.0310 0.58 0.43 0.38 0.39 0.48 031 0.04 0.12 0.06 0.04 0.01 0.01 0.20 0.09 0.65 0.01 0.05 0.05U - - - — - - - - - - - 0.65 0.60 0.44 0.51 0.47 0.16 0.19 0.05 0.05 0.11 0.01 0.12 0.16 0.07 0.74 0.19 0.00 0.1212 - - - - - - - - - - - - 0.71 0.50 0.51 033 0.14 0.14 0.02 0.03 0.08 0.04 0.17 0.22 0.15 0.78 0.21 0.01 0.1513 - - - — - - - - - - - - - 0.45 0.45 0.47 0.17 0.16 0.00 0.05 0.08 0.01 0.08 0.23 0.05 0.75 0.18 0.03 0.0714 - - - - - - - - - - - - - - 0.40 0.46 0.23 0.11 0.14 0.07 0.05 0.12 0.08 0.08 0.16 0.67 0.24 0.06 0.1515 - - - - - - - - - - - - - - - 033 0.06 0.05 0.10 0.04 0.07 0.05 0.05 0.24 0.06 0.69 0.16 0.11 0.1716 - - - — - - - - - - - - - - - - 0.04 0.06 0.09 0.12 0.12 0.02 0.03 0.10 0.12 0.72 0.17 0.12 0.1517 - - - - - - - - - - - - - - - - - 0.59 0.28 0.00 0.35 0.46 0.21 0.17 0.15 0.16 0.73 0.14 0.6118 - - - - - - - - - - - - - - - - - - 0.04 0.02 0.11 0.19 0.16 0.11 0.05 0.16 0.44 0.09 03919 - - - - - - - - - - - - - - - - - - - 0.00 0.26 0.30 0.03 0.07 0.05 0.02 0.19 0.25 0.4120 — - - — - - - - - - - - - - - - - - - - 0.26 0.04 0.12 030 0.25 0.09 0.01 0.02 0.0121 - - - - - - - - - - - - - - - - - - - - - 0.79 0.05 0.12 0.00 0.08 0.28 0.25 0.4122 032 0.16 03623 0.03 0.09 0.06 0.24 0.06 0.1924 0.12 0.22 0.22 0.08 0.1225 0.10 0.17 0.13 0.1626 0.22 0.01 0.1427 034 0.8128 0.81

Appendix G

Original SPSS-X Data Print Out

84


85

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