There is a chasm between the American model of “I disagree, you’re fired!” and the European model of “unless they break a law, we will pay them off to avoid a possible employment tribunal”. The model I was taught to use was the carrot and the stick, and to hold both of equal importance when managing a situation. As time goes on, I am seeing more and more often people managing with either one or the other but not both. I do not think that either model provides the best outcomes for all circumstances when used in isolation and fear that if allowed to continue on its current course, western countries will find themselves at a considerable disadvantage with market globalisation.
Having considerable experience leading teams under both types of models, I believe that although each have distinctive benefits, used almost exclusively in isolation they both have the ability to cripple a business. Neither option are a one size fits all solution and therefore businesses should consider using an employment model somewhere in between (Balanced Employment Model).
A companies’ employees are their greatest asset and not having the ability to provide staff with risks AND rewards both disincentives stretch and gives the impression that the business does not treat staff with respect. Either of these models remind me of the motto “when you’ve got a hammer everything looks like a nail”. All too often we see leaders/management act without considering the options at their disposal regarding HR matters and focus on one of three solutions depending on their demographic and business culture:
- Treat staff as a commodity, bring in HR and/or Legal to let staff go when convenient for the business (Replacement Employment Model).
- Focus on the social aspects of employment and only address critical situations to otherwise avoid potential conflicts with staff (Protective Employment Model).
- Give in to the bureaucracy and accept the situation due to very complicated processes and excessive consequences, and do nothing (becoming the future EU Employment Model in my opinion).
There was a rule during my time at GE that if someone was bring the team down because they were not a pulling their weight and if the manager didn’t manage them effectively, the business would find a manager who would, therefore removing the option of doing nothing.
Without addressing the situation and balancing the scales we run the risk of encountering some very dire consequences by using either model almost exclusively:
- Replacement Employment Model – Poor staff retention, high turnover and increased salaries which limit global competition.
- Protective Employment Model – Reduced staff morale, stifled innovation and dumbing down of the labour force.
… Next week part 2 of 3, I review in more detail the Pros and Cons of the individual models.
These are my thoughts, do you agree? I, as well as many of the other readers, would be interested to read your opinion.
Through Willard Enterprises, I specialise in helping businesses achieve successful lasting change through IT transformation, process improvement, smart sourcing and providing IT transparency such as assisting you in completing department health checks. As always, if there is something I can do to help your business or someone you know deliver their next challenge, please look at my website and contact me for more information.