INTERNATIONALHRM: A CROSS-CULTURALAPPROACH
By Terence Jackson. Sage, London, 2002, xii + 252 pp., $69 (paperback)
I
n this book, Jackson presents an innovative discussion of the cultural assump-tions that affect human resource management (HRM) in global organisaassump-tions. He focuses on some of the key differences in HRM orientation across national cultures (including Dutch, Japanese, Chinese and British) and geo-political divides (including post-Soviet, European Union, post-Colonial), and comments on how these differences may impact on indigenous and foreign companies in these regions.Each chapter in the book focuses on a particular cultural ‘model’ of organis-ations. Within each chapter, Jackson provides an overview of some of the cultural and management research relevant to each region, as well as case studies ‘to discuss issues as far as possible within the context of real companies and real cultures’ (page x). Each chapter also considers the implications for managerial action from the case(s) and developing further research in each area.
The author concentrates on a particular feature of HRM in each of his ‘models’. For example, in the Japanese model (chapter 5) he examines how a holistic approach to commitment has played a role in motivating the Japanese workforce, and how such a perspective may be exported to other parts of the world through Japanese multinationals. Another example is the Dutch model (chapter 4), in which Jackson focuses on the role of expatriates, and provides an understanding of the way in which Dutch companies may have developed specific roles for expatriates based on Dutch culture and history.
While each chapter focuses on a particular set of issues (for example, expatri-ation, training and development, and performance management), the purpose is not to suggest that one particular model is the most appropriate to deal with a particular human resource issue. Rather, Jackson takes aspects of HRM in each chapter and submits them to somewhat of a cultural litmus test—using the identification and practice of a particular concept (say, work flexibility) in a particular cultural context (say, the European Union) as an impetus to discuss the appropriate use of the same concept in other cultures and in global business management. He further makes the point that concepts such as commitment, job satisfaction, performance management, and development are most often seen from a Western point of view, developed within Western cultural assumptions and often imposed on other cultural contexts. Here perhaps, one assumption Jackson himself makes is that the reader is approaching the area from the perspective of a ‘Westerner’. He voices his concern that the opportunity to
transfer management lessons from non-Western countries to the West is often overlooked.
The concept of locus of human value is developed in this book to illustrate different ways of understanding the value of people, and their relationship to work and organisations. Jackson contrasts an instrumental perspective—human beings as a resource used in the pursuit of shareholder value, to a humanistic perspective—people regarded as having a value in their own right and being an end in themselves. His suggestion is that a hybrid form of HRM may provide an opportunity to apply the best of both extremes. The effective international manager should recognise the benefits of a range of cultural perspectives in order to successfully undertake management activities. However, Jackson’s locus of human value would appear to relate most closely to the role of organisations and business in society, and so fits particularly well within a discussion of manage-ment systems and processes.
Each chapter in the book provides case studies of an indigenous (or at least initially indigenous) organisation. These demonstrate the particular human resource feature and cultural assumptions drawn from Jackson’s overview of the cross-cultural research on the area. Some of the cases contribute more fully to this aim than others: IKEA’s initial ‘Swedish’ egalitarianism in Spain, or Crédit Lyonnais’ struggles to globalise with its ‘French’ career management structures, highlight the effect of indigenous HRM assumptions on company expansion into foreign markets. However, it becomes more difficult to integrate cases with research in geo-political divisions such as the post-Soviet or post-Colonial models, where research into East German, Russian, Czech, and African cultures is more limited.
Jackson states in the preface that the use of case analyses in the book does not aim to be comprehensive in their coverage of industries. Rather, they are intended to illustrate the activities and approaches of international organisations. However, there is some variation in the detail of the case studies provided, which may reflect the degree of detail available to the author (some cases are taken from already published sources). This variation serves to draw a sketchy picture of the activities of one or two of the organisations discussed in the text. For example, a fairly extensive four-page discussion in chapter 1 of IKEA’s HRM approach in Spain stands in marked contrast to a half-page discussion in chapter 10 of Colgate-Palmolive in South Africa.
A number of interesting points are raised in this text. One is the dominance of a US-based competency perspective and its strong impact on HRM approaches in developing countries. Jackson suggests the economic power of the US lies behind this; the argument is basically that it would seem to make sense to copy the approach of a country that is successful, although the degree of transfer from other successful countries is questionable.
inter-dependence between HRM and other organisational considerations, such as strategic goals, product life cycles, and industry dynamics, is often glossed over in discussions of culture and management that can overemphasise the ‘people side’ of business in isolation from other organisational concerns.
In terms of the overall format of the book itself, some of the chapters appear a little isolated. Perhaps a linking table would help readers exposed to some of the information for the first time. ‘Briefings’ about each country or region would also benefit from a standard table in each chapter. To be fair, Jackson does this in the initial chapter, however, a reminder, in a similar format in each chapter, would be useful. In addition, it is annoying to find a number of spelling mistakes and tables that are formatted incorrectly (with a blank page in between columns, for example), particularly where mistakes alter the meaning of the text. Such errors are certainly not usual for a Sage publication and this detracts slightly from the readability of the book.
I would certainly recommend that this book be read in conjunction with earlier research on culture—an understanding of the work of Geert Hofstede (Culture’s Consequences: International Differences in Work-Related Values, Sage: Beverly Hills, 1980) and Alfons Trompenaars (Riding the Waves of Culture: Understanding Cultural Diversity in Business, Nicholas Brealey: London, 1993) would be advantageous in understanding some of the information presented in the book.
The end effect of International HRMis to provide an important, ambitious, and considered explanation of the way that managers may ground their own realities in cultural assumptions. The book highlights particular areas of business and human resource concerns across diverse cultures, demonstrating that different cultures approach these topics from a different set of assumptions about the person and the organisation.
CURTINUNIVERSITY OFTECHNOLOGY ELLIOTWOOD
PAYING FORPERFORMANCE: ANINTERNATIONALCOMPARISON
Edited by Michelle Brown and John S. Heywood. M.E. Sharpe, Armonk, New York, 2002, xiv + 298 pp., US$25.95 (paperback)
difficult to discern a shared understanding or central argument that unites the chapters and brings this particular group of authors together. This is more than a comment about structure as it affects the development of an argument within the book. Hence, despite the claim that ‘common themes across the countries’ are drawn out, it is sometimes difficult to discern these—a problem exacerbated by the indexing system, which deals with subjects such as ‘share ownership plans’ according to the country in which they are based. This further highlights the specificity of the research and makes cross-referencing or comparison difficult.
In the introductory chapter, Brown and Heywood make reference to the ‘new pay’ model, citing authors closely associated with this strategic-fit approach. However, the extent to which they endorse or refute this perspective is not clear. Despite these problems in providing a theoretical framework for the book, the empirical chapters that follow make valuable contributions to a research subject that continues to receive limited attention, as the following selected contribution summaries hopefully indicate. Chapter 2, by economist Daniel Parent, uses the Lazear model to evaluate the effects of performance pay in the US, where nearly half of all American workers claim to be paid some form of individual merit pay or profit sharing. Chapter 5 commences with an historical explanation of what the authors, Marsden and French, claim is the most important change in pay systems in Britain during the last 15 years, the spread of performance-related pay from the private to the public sector. Focusing on the introduction of performance pay at the Inland Revenue, these authors discuss the potential disadvantages and perceived benefits of performance-related pay based on analysis of questionnaire data collected during 1992 and 1996–7. They do so in a way that reveals the complexity of the issues involved. Chapter 8, by Hélio Zylberstajn, an economist from the University of São Paolo, outlines the legal situation that has historically prevented Brazilian firms from adopting flexible compensation and explores the extent to which they use performance pay to reduce compensation costs and enhance labour productivity. Other chapters provide in-depth analyses of performance pay in Germany, France, Japan, Canada and Australia. In the concluding chapter, the editors attempt to bring these diverse contributions together, claiming the ‘most remarkable finding to emerge from the studies in this volume is the accelerating nature of experimentation and change in payment methods’ (p. 265).
To conclude, this is a valuable text for anyone with an interest in this subject. It provides valuable comparative insight into current performance pay practice in a number of countries and demonstrates the widespread nature of this phenomenon. However, it is less successful in providing an overarching set of themes to unify the book and it may therefore be more appropriate to read the chapters selectively rather than sequentially.
LEARNING FROMSATURN: POSSIBILITIES FOR CORPORATE
GOVERNANCE ANDEMPLOYEERELATIONS
By Saul A. Rubenstein and Thomas A. Kochan. Cornell University Press, Ithaca and London, 2001, x + 156 pp., US$25 (hardback)
The mid-1980s proved to be a significant time in US labour relations, both in terms of academic scholarship and in relation to experiments in the auto indus-try. Two of the most publicised initiatives in the US auto industry during the 1980s were the New United Motor Manufacturing Inc. (NUMMI) and Saturn plants. NUMMI was the joint venture between Toyota and General Motors (GM) at the latter’s old Fremont site in California. Saturn was originally the code name for the new GM project at Spring Hill, Tennessee, and subsequently became the name of the model of the car produced at the site. It was the Saturn workplace model that captured the imagination of people interested in fostering a different, post-New Deal labour relationship in the US. In this slim and engaging book, Saul Rubenstein and Tom Kochan have teamed up to write the labour relations and corporate governance story of Saturn.
The book draws on the premises as set out earlier in The Transformation of American Industrial Relations(by Tom Kochan et al., Basic Books, New York, 1986) that the New Deal labour relations model was under challenge and in decline. The philosophy underpinning Learning from Saturn is also consistent with Kochan’s broader philosophy of promoting a better social contract for American employees within a framework that legitimises a role for unions and seeks responsible action from corporations. Set against the backdrop of the demise of New Deal labour relations and competitive challenges facing the US auto industry, the book explores two issues: corporate governance and labour rela-tions. The authors argue that Saturn is about a ‘different model of organizational governance and a very different concept of labour-management relations . . . [Saturn shows that] the two debates are inseparable and should be treated as one’ (p. 2). These issues are both as important today, perhaps more so, as they were 20 years ago when Saturn was first conceived!
Despite the rise of the ‘new economy’, the knowledge worker, and diversified employment arrangements, the auto industry retains a fascination for many people. There is a long tradition of auto plant studies in labour relations research. This is possibly because the auto industry has encompassed the full range of interest areas: large scale manufacturing using both traditional and exceptional production systems, often accompanied by high levels of employment, unionis-ation and industrial conflict. Learning from Saturn adds to the genre and demon-strates that it is feasible to adopt a different path even within an established sector and that a new and different relationship between labour and management can be forged. With clear and honest attention to detail, Rubenstein and Kochan show us, however, that this is not achieved without difficulty.
self-directed work teams and integrating union representatives into the full range of management’s strategic and operational decision making processes. Interestingly, the current Saturn website provides a chronology of the plant. It explains that in January 1985, the Saturn Corporation was ‘founded from scratch, taking a clean-slate approach to everything’. According to the Saturn site, in July 1985, a ‘unique pact’ was formed with Saturn and the UAW to ‘create a revolutionary agreement’ that was so simple it could ‘fit in a shirt pocket instead of a three-inch-thick binder’ (www.saturn.com). In a similar vein, Rubenstein and Kochan claim Saturn was ‘the boldest and most far-reaching experiment in organizational form and labor-management relationship’ in the US. Saturn, its labour contract and management partnership arrangements were unique. Indeed, there is no match for it in Australia—certainly not in the auto industry. Saturn is also renowned for its special relations with suppliers, retailers and customers and has successfully introduced a ‘service-supply-chain strategy’ innovation.
Saturn appears to have exemplified the partnership and network model of manufacturing, combining some of the elements of lean production with a corporate governance model of shared responsibility and risk—with workers, union, retailers, customers and suppliers. This has difficulties for management as well as unions. The book sets out clearly and objectively these issues and dis-cusses a range of tensions that emerged at Saturn. These included intra-union rivalries between the local and national UAW leaders; and intra-organisational rivalries between Saturn management and GM management overall.
Like most greenfield sites that are genuine attempts to practice new manage-ment philosophies, foster new labour relations or introduce new production processes, Saturn required constant vigilance, renewal, attention and effort. As well as often being high performance and high commitment sites, such exemplars are high maintenance sites. So, just as with other greenfield experiments, the big question remains. How can such islands of innovation be positively transferred to the rest of the organisation, in this case GM, as well as mainstream labour relations? A first step is to fully understand what is involved in running such sites, and this is what Rubinstein and Kochan provide in this book. They meticulously investigate the struggle the local union had in defining its role at Saturn and similarly how GM handled Saturn within its own corporate world. The authors draw a number of lessons about teams, union renewal, learning organisations and labour-management partnerships.
The lessons from Saturn have broader application than just for GM and the auto industry. Unfortunately perhaps, the reality is that in most car plants the managers and people who work in them have never had the opportunity to experience the Saturn model. Rubenstein and Kochan have given us a good insight into the exceptional workplace, and they clearly challenge the view that the sole purpose of organisations is to maximise shareholder wealth. They are also honest about the dilemmas unions face in combining independent workplace representation at the same time as sharing in managerial decision making. I am not at all sure that it can ever be fully replicated, but there are ideas in this book that are worth considering seriously.
UNIVERSITY OFSYDNEY MARIANBAIRD
HEADHUNTERS: MATCHMAKING IN THELABORMARKET
By William Finlay and James E. Coverdill. Cornell University Press, Ithaca and London, 2002, 203 pp., US$29.95 (hardback)
This book reports on case study research into the contingent recruitment industry in the US. The authors are interested in three related questions: How do headhunters persuade employers and job candidates to sell themselves to each other? What do employers gain by using headhunters? and What criteria do headhunters use in choosing job candidates.
The book is structured as follows. In the first chapter the authors argue that there are broad changes in the US economy that have created an increased role for recruitment consultants. In the second chapter, they introduce the highly plausible notion that recruitment consultants are involved in a ‘double sale’— selling the job to the candidate at the same time as selling the candidate to the client. Chapter 3 argues that managers use headhunters because the practice provides them with not only economic advantages, but also political advantages over using internal resources. Chapter 4 turns to the uncertainty facing recruiters and examines some of the techniques they can use to avoid uncertainty in what can be a very fickle relationship. The fifth chapter examines ways that recruiters identify and present candidates for positions. In chapters six and seven, the authors attempt to identify the role that recruiters play in shaping who does (and who does not) get shortlisted for a position and what recruiters can do to influence clients’ perception of the field of applicants. The final chapter deals with the process of negotiation that takes place after a job offer is made.
of the market by flicking through the front section of the Sydney Morning Herald
or the Ageon a Saturday morning. Bear in mind too, that each of these ads costs clients between $3000–$5000. Nevertheless, much of what recruiters do involves a lot of confidential information about companies and candidates, and this would make research difficult. The approach taken by the authors—of conducting a limited number of case studies across a range of different types of organisations— overcomes this problem, but by the same token may exaggerate the prevalence of some practices and attitudes in the industry as a whole.
It is perhaps worth noting that this book is not really about headhunting as most people would understand it. ‘True’ headhunting is retained search; that is, the consultant is retained (not paid on results) who then looks for particular candidates. This book is about contingent search whereby consultants are only paid when they fill a position and, as such, are in competition with other recruiters. While contingent search is dominant in the US, it is not very common in Australia. In Australia, search is reserved for very senior positions and it is almost always retained.
Most recruitment in Australia is based on selection of a short list of applicants from a job ad. Selection is almost unheard of in the US, in part not only because is there no reputable national newspaper that carries classified advertising, but also because there is an assumption that nobody who is any good would apply to a job ad. The main distinction in the Australian market is between retained selection (where only a percentage of the fee is contingent on the placement), which is common for management and senior positions, and contingent selection (where the recruiter is paid only on filling the job) which is generally associated with non managerial recruitment.
There are a number of aspects of this book that reflect that fact that it is about the US, and readers seeking to apply it to Australia would need to take these differences into account. An Australian study would have to examine the relationship between recruiters and ad placement agencies and also look at how recruiters deal with positions that they have not filled, but yet have been paid a retainer.
The central argument of the book is that the hiring decision is a social process as well as an economic one and the authors use the metaphor of romance to try to capture its major elements. While there is a kernel of truth in this, I think there is a danger in pushing the romance metaphor too far. In my experience, while the social aspects of the hiring decision can be important (because the hiring decision can have major economic consequences for the organisation), economic factors play a greater role than the authors seem to suggest. What is more, I believe that I am an excellent recruiter but not a very good matchmaker. Perhaps more important is the observation that every applicant is a potential client and therefore needs to be handled respectfully.
men. They seem to find it easier dealing with and employing other men, not because there are no women capable of doing the job.
One major area that the book does not cover, but I believe warrants a closer examination, is the economics of recruitment firms themselves. There are a number of remuneration models operating in the recruitment industry and these impact on the recruitment process. There are two major distinctions: if pay systems are individualised or group-based, and whether you are rewarded for getting the job (business development) or filling the position (execution). In traditional firms, the bulk of the fee goes to a senior consultant that develops business and execution is left to assistants who do not get any extra rewards. This can have some undesirable outcomes. Other companies have experimented with group-based payments, which also attempt to take execution into account. The recruitment industry has also witnessed a number of other changes, including mergers and the growth of large multinational firms like TMP, attempts by companies like my own to use the Internet to redefine the industry space, and the growth of longer term managed service agreements between recruiters and clients. All of these developments have the potential to fundamentally alter the economics of the recruitment industry.
Headhuntersis an excellent introduction for anyone interested in the world of recruiting. It would be a valuable addition to the reading list of both general and specialist HRM courses and academics interested in the labour market would find it appealing. It would also make useful reading for managers who are considering engaging a recruitment company, those applying for jobs and may even provide a few pointers for the recruiter themselves. I would also like to see more research in this area, particularly research that focuses on the Australian scene.
KORN/FERRYINTERNATIONAL SHARONCOLLINS
SEXUALPOLITICS ANDGREEDYINSTITUTIONS
By Suzanne Franzway. Pluto Press, Sydney, 2001, x + 186 pp., $34.95 (paperback)
For anyone who is suffering under the delusion that gender is not an issue in the union movement, time should be set aside to read this book. For anyone else who is interested in how change is made (or not made), it is also an interesting read. Franzway bases her empirical work on interviews conducted with a series of women trade union officials. She covers their issues thematically to protect identities—underlining what a small world women occupy in the union movement—and by doing so, also makes it easy to navigate her central ideas.
If one is unfamiliar with feminist theory, it is worth attempting to grasp the concepts on offer here and Franzway explains some of the key dichotomies that besiege understandings of sexual politics in a relatively accessible fashion. If readers feel unequal to the conceptual challenge, it is still possible to skip or skim the ‘hard’ theory section in chapter two and yet follow the threads of the book’s main argument.
Franzway investigates how and why gender issues remain marginal in the trade union movement. She makes the key observation that women who work in unions are subject to the needs of two greedy institutions: the union movement and the household/family. Both institutions make powerful demands on the time, energy and emotion of women. Despite decades of struggle to re-align gender respon-sibility on the home front, overwhelmingly the burden of care and continuity of family resides with mothers, sisters and daughters. Franzway comprehensively illustrates that women active in unions also have to contend with the tacit rule in the ‘movement’ that the labour struggle is primary. This ‘conflict’, where women are torn between the household/family (in which they are invisible) and the bottomless requirements of being an activist (where women suffer a special kind of scrutiny) is, in many cases, unsustainable.
Given the overwhelming pressure these two fronts place on women officials and activists, it is less surprising that the strategic aims of the union movement do not encompass the major concerns of women in paid work, and even less surprising that progressive union aims fail dismally to address the issues of women’s unpaid work. In many ways, the trade union movement has been better equipped to save koalas than achieve equity for women! Recently, I sat in a room of ‘progressive’ organisers (all men) who were seriously troubled by the use of part time work that their union continues to actively fight against. When I worked in a public sector union we were unable to influence the membership of a particular workplace to support the establishment of a child-care centre rather than a gymnasium. Franzway makes clear that the women in positions in unions apparently able to direct and develop progressive strategies for their female constituents are significantly outnumbered and still confront discrimination on the basis of their sex and sexuality. Moreover, they confront daily the sapping time and energy demands of the public as well as the private spheres they labour in.
Why is this the case? Franzway argues that it is because we have not spent enough time explaining the links between the public and the private spheres; that they currently occupy different conceptual spaces despite the fact that in reality they intermingle and impact one upon the other in a complex (but currently unstudied) fashion. According to Franzway, women in the union movement face a triple bind: women continue to confront male hostility to their involvement in the movement; issues that are central to women’s lives continue to be peripheral to the movement; and building and maintaining the private sphere (house-hold/family) continues overwhelmingly to be the responsibility of women. This cocktail of barriers limits the political and practical reach of most women in comparison to men who more often than not have their private concerns attended to by others.
Trade unions in Australia are currently beset by a profound series of challenges: the rapidly changing nature of work and the growing alignment of political and economic interests that seriously confound a traditional trade union movement. Franzway believes that the best response to these fundamental shifts will be to ‘(integrate) the effects of patriarchal gender relations and sexual politics’. She sees real power in the intersection of feminist and trade union politics that transcend the current invisible boundary between the private and the public spheres.
ACIRRT, SYDNEY JUSTINEEVESSON
ORGANIZATIONALCULTURE: MAPPING THETERRAIN
By Joanne Martin. Sage, Thousand Oaks, California, 2002, xii + 402 pp., $64 (paperback)
In recent years, a number of criticisms have been levelled at organisational culture leading to claims that cultural research was ‘dead’, that it was just another managerial fad and simply something upon which consultants and practitioners could make a lucrative living. There has also been considerable scepticism as to whether or not culture was something that could be manipulated to enhance organisational performance. One of the challenges facing cultural researchers is that it encompasses a number of different intellectual traditions and there is little agreement within and between the traditions. This book is the culmination of many years of research by the author into the murky field of organisational culture. Martin confronts the criticisms and makes a passionate, but balanced, defence of cultural research into organisations.
not a ‘how to do it’ for practitioners. Rather, it is a considered, critical and elegant review of the organisational culture literature that challenges the reader to think about the subject matter in different and deeper ways. To this end, Martin achieves her goal.
The book is divided into three parts. Each of the chapters is organised around a series of related questions or what Martin calls ‘dilemmas’ that confront the cultural researcher. The first part is the largest section of the book and deals with mapping the cultural terrain. Here, Martin introduces us to the culture wars of the 1980s and 1990s which outline the key debates and major controversies surrounding the topic. One of the real treasures is Martin’s analysis of what culture is and what it is not. In an exhaustive review of the culture literature, Martin introduces and explains in detail the central constructs of organisational culture and how they might be operationalised. For new researchers, part one provides an invaluable introduction to the core concepts and debates. Most of part one is taken up with a detailed examination of theoretical perspectives on culture, including the ‘three-theory perspective’ developed elsewhere by Martin and Debra Meyerson, and considerable space is devoted to the defence of this perspective. The salient, but often taken-for-granted question of whose interest is served by the research and in whose interest is the researcher working, is raised.
The second part explores the practice of conducting cultural research. In this part of the book, Martin reviews the methodological debates, primarily the quantitative verses qualitative debate, and argues for a multi-method approach to culture studies. Perhaps the most useful part of the book is the integration and review of sample studies and writings about cultures, whereby Martin presents an overview of a selection of well-known culture studies along with the comments of two reviewers contrasted with her opinion. This section of the book concludes with an examination of scholarly writing about culture. Martin explores how studies of culture have been presented to their intended audience, examines a range of written styles including the use of reflexivity, criticality and post-modernism, and calls for the use of innovative writing styles, as she puts it ‘to convey and acknowledge the ambiguities of meaning and the uncertainties of contemporary life’ (p. 307). Academics writing for scholarly journals in the social sciences will find this part of the book useful in addressing some of the criticisms directed towards cultural studies and the selection of research methods.
corporations, international cultural issues, new organisational forms, the work–family boundary, as well as inviting us to consider new media for studying cultures. Unfortunately, part three is the shortest section and is the book’s main weakness. Martin’s analysis of the margins of cultural theory differentiates this book from others on the topic and this part deserves wider discussion.
What also sets this book apart from others on organisational culture is the breadth and detail of Martin’s analysis and its written style. One of the highlights of the book is the accessibility of the written material. The argument is presented in a manner that is both engaging and interspersed with a reflexive voice and personal style that I found refreshing. This book has much to recommend it and I am sure that it will become a standard text to a wide audience, or simply a good starting point for those setting out on their own voyage of discovery into the world of organisational culture.
UNIVERSITY OFSYDNEY SHAUNRYAN
THEREALWORLD OFEMPLOYEEOWNERSHIP
By John Logue and Jacquelyn Yates. Cornell University Press, Ithaca and London, 2001, xvi + 247 pp., £11.50 (paperback)
This book, as the title suggests, is about employee ownership in Ohio, US. It is based on the authors’ long-term involvement with employee-owned firms in the Ohio Employee Ownership Centre, as well as their scholarly activities in the area. Much of the material presented in the book is derived from a survey of employee-owned firms in the early 1990s, supplemented by the authors’ intimate know-ledge of many of the firms in the survey and, at times, by the findings of an earlier survey. The authors’ primary concern is to address the proposition that ‘it is the combination of employee ownership with employee participation systems, open communication about the business, and the training to use those systems, and to understand the information communicated which has a positive impact on company performance’ (p. 6). Thus, there are chapters on communication and training (by Karen Thomas and Jennifer Maxwell), employee participation, unions and employee ownership, the impact on performance, and the encouragement that can be given to employee ownership by public policy.
The authors attempted to survey the entire population of firms with employee share ownership plans (ESOPs) or similar mechanisms, and secured a response rate of over 60 per cent. The survey findings indicate that the most important reason for establishing an ESOP was to buy stock from a retiring owner. A philosophical commitment to employee ownership, aided and abetted by generous tax incentives, was the main reason that retiring owners took the employee ownership route. Just under 15 per cent of ESOP firms took the employee ownership route to avoid a shutdown or job-loss. Most employee ownership firms were minority employee-owned and 30 per cent were majority-owned. They find that most ESOPs take some steps to broaden employee participation in management, but that in most cases these changes are quite modest. A quarter of firms make no changes at all. These findings are broadly similar to those observed elsewhere.
The over-riding picture arising from the book is that of the diversity of motives, practices, and impacts between firms with employee ownership. Logue and Yates point out that the patterns of participation are quite bewildering. They note 18 distinct patterns of participation. Interpretation of these findings could have been assisted by greater use of statistical methods to cluster the data. For the most part, the authors rely on frequency distributions and simple tests of association (there is, however, a causal path multivariate model towards the end of the book). Some may argue that this limits the findings on performance because other relevant influences are not controlled for. This is unfortunate since advocates for employee ownership would welcome a stronger foundation to the claim that ‘expanding participation is one of the surest methods of enhancing financial success for ESOP firms’ (p. 101). The two most potent forms of participation were involvement at the shop floor and representation on the board of directors, and combining these two is good for the bottom line. By contrast, employee representation on the administrative structures for operating the ESOP did nothing for the bottom line. A further important finding, though one subject to the limitations mentioned above, is that some of the firms that did not introduce any forms of employee participation in decisions post-ownership-conversion suffered falls in their profits relative to the sector norm.
The chapter on unions and employee ownership should be of interest to those concerned that employee ownership can undermine union membership and representation. To my mind, however, the authors compress a little too much information into this chapter. They focus on the impact on union repre-sentation, the relationship between unions and participation, and the relation-ship with performance. It all gets a little too complicated, and it is difficult at times to see the wood for the trees. It might have been beneficial to draw on their case study experience in this chapter as the dynamic relationships between unions and employee ownership is arguably not readily captured by a single-shot survey.
All in all, this book makes a valuable contribution to the employee ownership literature. It provides evidence that confirms important propositions in the employee ownership literature, even though it does not aim to test theory. If Logue and Yates were to do a second edition, they could simplify the presen-tation of findings by using a greater battery of statistical tests. They could also draw more explicitly and extensively on some of the other work being done on employee ownership in the US at the moment.
