Reevaluating Union Trade Responses

Since the 1980†³s academia and professionals alike have been picking at the bones of discussion regarding the ‘decline† of Trade Unions, their strategies of ‘survival† and issuing prescriptions as to the most suitable form Trade Unionism can take in order to modernise, compromise and indeed to qualify for a role within the ‘new† workplace. Within this plethora of discussion much is made of placing relevant unions into suitable and identifiable criteria, whether it be the AEEU and it†s ‘Enterprise† unionism or UNISON†s ‘Managerial† unionism. Although these criteria may be suitable within a fixed period or in order to understand a particular situation, the argument remains that they are static and do not necessarily reflect the many forms that unionism can take. Indeed much of the criteria presented is regarding the union as an organisation, as a business even, and in this way does not account the most important factor, that of a Union†s members and the branches within which they interact. Membership and the Collective voice is the foundation of Trade Unionism, it will therefore be argued that faced with a ‘New† Industrial Relations Trade Unions, in this country, have illustrated an uncoordinated approach and have merely tested solutions, moving gradually back to the membership in order to consolidate their position. Naturally there will be those unions who will stay with a tried and tested formula , however with the impending ‘Fairness at Work† legislation unions will be given space to engage their membership rather than attempting to engage managers in attempts at recognition. The reevaluation of union strategies will involve a critical analysis of both set criteria, prescriptions of moderation and a reconsideration of militancy . The argument will thus draw parts of certain ‘criteria† and aim towards methods whereby engagement and resistance may coexist effectively enabling effective ‘partnership† with effective ‘representation† through the education and strong organisation of union members. The term ‘New Industrial Relations† encompasses the change in the workplace, managerial trends, Trade Union strategies and the backdrop against which the play commences and adapts. This backdrop consists of historical, economic and social factors which have influenced industrial relations as it now exists. Much is documented about the gradual transformation of roles that occurred during the 1980†³s and certainly in the 1990†³s; The legislative onslaught upon the Trade Unions, by the Conservative Government, effecting both their financial and organisational strength. The backing and encouragement of the growth of big business, by the Conservative Government, in order to counteract the rise of unemployment and to replace the decline in such traditional areas such as manufacturing. The rise in unemployment effected a fragmentation on the workforce and ended the notion of ‘a job for life†, replacing the full time, dominantly male, workforce was the part time, temporary and the rise of the female workforce, itself transforming society and family roles. As can be seen through this chain of events the traditional base of trade unionism had disintegrated, hailing criticism that trade unionism is no longer relevant to this new workplace, criticisms that were supplemented by a falling membership and a weakened bargaining base. In extension and, to some extent, response to this business and managerial trends were being heavily influenced by both the presence of and the success of international companies who were utilising new management techniques. The two main trends that will be briefly discussed, in regards to their effect on Trade Union renewal, are that of Japanisation and Human Resource Management primarily through the work culture they wish to produce rather than their distinct workplace structures. It is to be noted, in regards to these two trends (which themselves have overlapping features), that two academic criteria have arisen in direct response and with distinct and reflective attributes, these two response criteria are Enterprise Unionism and Managerial Unionism . Enterprise Unionism can be best described in conjunction with the Japanisation of British Industry. Japanisation occurred not only through the presence of Japanese companies in Britain (Hitachi, Nissan etc.) but also through British business† observations of the success if Japanese Business, therefore the matter is twofold with Japanese businesses applying their business culture to their British subsidiaries and British business ‘borrowing† the better parts of Japanisation for themselves. The main aims of Japanese practices is best described by White and Trevor (1983) in that they aim to create: † a stable workforce with a high level of commitment to the company: extremely cooperative in accepting change, extremely unwilling to enter into strikes or any other forms of conflict, and generally putting the company†s interests level with or even ahead of it†s own. The outcome is a high and rising level of productivity, and an altogether easier climate in which management can plan for changes in products and processes† Dedication to the company and its ideals goes one step further when applied to the workplace and the presence of a trade union. The most obvious outcome is that the very existence of a trade union, and in deed it†s historical connotations, points towards an adversarial situation and a separation of ideals and goals. In order to counteract this fragmented relationship ‘Japanisation† also endorses the case for the single union deal. The very notion of the single union deal explains the terminology applied to those unions who seek them, for in order to get the deal one must put forward the best business case. The context and result of this situation is typified by the case of the EETPU and Hitachi, this union deal (being the first of many) can be said to have heightened the debate regarding the direction of Trade Unions and also bringing into question: â€Å"..many of the core concerns of trade unions, including the sanctity of traditional territorial boundaries between one union†s membership constituency and anothers, the extent to which unions should pursue their objectives via a consensual or a conflictual relationship with management, and to the degree to which, in contemporary work settings, unions can influence the ground rules of the union-management relationship, or are subject to managerial definitions of the basis upon which those relationships will operate.† This active approach to single union deals gives rise to the aforementioned case case-putting, more candidly described as the ‘ ‘beauty contest'† These contests, as illustrated by the EETPU deal, can result in no strike deals , pendulum arbitration and the creation of Employee Board. Employee Boards may or may not include union reps and indeed their very existence has led to some critics to argue that such agreements ‘bind unions through institutional subordination to company councils† (Ogasawara and Stewart, 1992) . This obvious circumvention of traditional representative channels and the active promotion of employer friendly unionism could entail the union become a mere rubber stamp or an empty shell, and is itself an argument for internal organisation to build internal strength before these deals are even considered. A further criticism of this approach can be drawn from two AEU deals with Nissan and Toyota whereby recognition, via a single union agreement, was given before recruitment took place, taking potential memberships choice out of the equation and leaving no real alternative in regards to union response. Justifiably the EETPU and the AEU are the epitome of Enterprise Unionism, their subsequent merger and their steady gain of membership perhaps promote their tactics. These tactics, however, give rise to the questions as to whether numbers are more important than effective representation, admittedly the larger the union, the louder its voice, however when this voice is muted by employer dictated deals the situation does require a reconsideration of a union†s aims and objectives. If business Unionism is placed at the far right of the union response spectrum, then the Managerial Union can be placed in the middle due to it†s response to the individualisation of the contract and work experience by Human Resource Management (HRM) HRM can be seen as focusing upon the individual at work, with an emphasis on flexibility, training and pay and rewards, emphasising a rhetoric of joint aims between the Employer and Employee. It is the main strand of this rhetoric, individualisation, that can be seen as the most active in the modern workforce. In response to this individualisation and the decline of collective bargaining that the rise of the managerial servicing relationship can be seen: â€Å"We†¦need to see our members as our customers. As sophisticated users of services, people will make choices depending on what impresses them about a particular company or product and what is in it for them. They have become used to high standards and have expectations based on those standards. It is in this framework of customer choice, that unions increasingly have to stake their claim to recruitment. We need to reassess what people really want from a union and what will make them join.† This trend towards consumerism is often coupled with a reorganisation of union structure to encompass a servicing relationship in regards to the new workforce. This structural change can be seen in both the GMB, MSF†s and UNISON†s structures that promote representative channels for women, young people, ethnic minorities and disabled workers . These channels are themselves serviced by Full Time Officers. A structural description of a servicing relationship is given by Bob Carter and Gavin Poynter (fig.1). Within this structure it is clearer to see how this form of unionism could facilitate a partnership at work, it†s reliance on full time officers allows for a direct filtering down of National Policy and can circumvent the actions of any ‘unattractive† activism, which is further weakened by a reliance on the union for advice. This is an integral approach on behalf of unions, such as UNISON, who ‘increasingly came to advance the concept of a well- disciplined, politically sensitive and well-coordinated approach to†¦trade unionism† (Terry, 1996) . Terry goes further stating that COHSE and NUPE ‘were concerned that the new union would become an ‘activist union†, with the risks that activists might become detached from the members.† This reliance on servicing to circumvent activism has caused the worry of inactivity at branch level and the rise of ‘passive consumerism†, recruitment is not being paired with strong organisation at branch level. This idea of creating an active branch is illustrated by the TGWU past and present campaigns , which further illustrate the problems of a servicing relationship and the possibilities of a future of self-organising unionism, an approach that UNISON itself has recently approached on with it†s ‘Beactive† Campaign. This response can also be seen as an indication that mere moderancy and partnership do not necessarily reap much reward in regards to members. With an emphasis on Organising and therefore transforming the relationship from â€Å"what can the union do for me?† towards a more proactive ‘What can we do for our union?† , unions can only nurture such a relationship through the realisation that the antagonistic relationship between worker and employee is a continual matter that needs to be addressed in collective strength: â€Å"The policy question for unions would thus appear to be how to adapt collective organization to meet new circumstances rather than how to replace it with passive consumerism† (Kelly and Waddington 1995)    Kelly illustrates this argument with evidence regarding the falling success rate of unions in regards to recognition cases, the marginalising of Stewards and most interestingly the view of the strike being beneficial in terms other than those directly involved. Kelly argues that strikes retain and in some cases recruit members through the illustration of a Union†s strength and commitment to the Collective with the prospect of a heightening of the ideology of conflictual interests among this Collective. The most important part of Kelly†s argument is it†s acceptance and recognition of external constraints, namely the managerial and economic trends outlined previously ,in recognition of these constraints it would be necessary to add to Kelly†s theory the need for effective training and education of lay officials in the responses to these techniques in order to achieve the pragmatism that Kelly prescribes. Resistance to any new Employer technique can be seen as a natural response to anything ‘new† however Trade Unions need to ensure that lay officials are able to recognise benefits and pitfalls and approach likewise. A National Policy of Servicing and Partnership do not translate well at workplace level causing alienation of activists and poor responses as can be seen by the TGWU experience at Volvo in the 1990†³s, the insight to which is provided by one of Volvo†s Swedish Managers: â€Å"When I moved here in December 1990 the problem we had was not so much the people as the way the way they were used to working, especially on the union side†¦.the problem we had with the union was that they did not have enough information or knowledge needed to bring out their point of view. It is important that when dealing with a system you have to have a strong union with strong people who work well and believe in what they do†¦..it takes a long time and that is what has happened here†¦That is a result of history, because they have not trusted the manager and they are not used to doing things themselves and taking responsibility for change† (Swedish Production Director, Workington) The cycle of this achievement can be formualised as: issueg organisationg educationg unityg action . Moderate Unionism ignores the potential of issues to unite it†s membership, the servicing model may recognise the issues but does not give the issue to the member to understand and merely prescribes a National Policy, Enterprise Unionism has no real strength behind any action to place upon an issue. It is these weaknesses which beg the return to the Traditions of Militancy with a ‘new† informed attitude. There is no indication that Trade Unions are about to go the ‘way of the dinosaurs† however they could well seal the fate bestowed upon them by Basset and Cave ( that of a mere provider of services). This fate can only be provided by recognising that traditional antagonisms still exist and recruit and organise around this while still engaging the realisation that parts of the New Industrial Relations are beneficial to workers. Moderation in Unions is not effective as a National Policy, indeed not even realistic, whereas the empowerment of members through democratic structures within the Union will build a strong organisation which can recognise and compromise with managerial trends on its own terms could well hold them in good stead. It is within this context that renewal, rather than replacement, can be viewed. The future context of these arguments will make interesting viewing namely the impending ‘Fairness at Work† legislation and the Trade Union recruitment of Young Workers, in order to contract the demographic change occurring within it†s membership, whether Trade Unions will achieve a cultural change which will nurture a new generation of activists could well determine the future of the role of Trade Unions and depends very much on the Unions ability to Acheve rather than receive members. Reevaluating Union Trade Responses The following report shall analyse the importance of the implementation of the marketing philosophy and shall highlight the importance off this idea to be shared by all functions within the company including top management, finance, production right down to the customer service representatives. The report will also attempt to measure the degree and success of such an implementation with respect to the Ford Motor Co. Henry Ford started his working life as an engineer for the Edison Lighting Company Detroit, in 1884. Ford by chance, came across a science journal written by Nicholas Otto, a German engineer who was developing the internal combustion engine. Ford became very interested, some say infatuated, and he decided to build his own. In the Following years Ford have become the worlds second largest car manufacturer in the world. Until recent years the Ford Motor Co have famously used the production concept. An example of this is when â€Å"Henry Fords whole business philosophy was to protect the production of the Model T so that its costs could be reduced and in turn more people could afford it. He once joked you can have it in any colour as long as it was black.†(Kotler, 1996) Since falling behind the Japanese manufacturers in customer focus and service terms, Ford have quickly changed their focus and concept and are attempting to implement an all pervading marketing philosophy in order to â€Å"win back the confidence of consumers†. â€Å"Marketing must now pervade a business† entire operation to win the confidence of consumers†. (Jane Simms, Marketing Nov 23, 2000) â€Å"The marketing concept provides a single prescription for running a business successfully. The consumer must be recognised and accepted as the focal point for all business activities and knowledge of consumer needs and wants should be a starting point for all major business decisions†. (Raymond and Barkinsale, corporate strategic planning and corporate marketing, Business Horizons, Vol 32, no3, 1989). These definitions clearly indicate the pivotal role that a marketing philosophy and consumer focus play in the success of an organisation, if properly shared by all functions. â€Å"The marketing philosophy can be expressed as the means of operating within an organizational philosophy, the philosophy will be regarded as the medium which governs all organizational life†. (Robert E. Morgan, Management decision, 1996). This quote signifies how marketing can exist and operate as a company†s whole business philosophy. An example of a company who has begun to implement the marketing philosophy throughout all functions with considerable success is Ford Motor Co. After falling sales revenue due to focusing on production and finance orientations, Ford decided to become a market-oriented organisation. â€Å"The market oriented firm is one which successfully applies the marketing concept. The term â€Å"market oriented† is preferred to â€Å"marketing oriented† as this highlights the organisational wide application†. (Sonny Nwanko, Journal of consumer marketing, Vol 12, Nov 1995). Fords Application of the Marketing philosophy Ford is zeroing in on the consumer and is currently in the first year of a five-year revitalisation plan to get back to basics and rebuild relationships with customers through the organization wide marketing philosophy. According to Fords General marketing manager Daryl Hazel â€Å"our aim is to transform Ford from a solid performer as an automotive manufacturer to a superior performer as a customer focused company†. Ford realise that their success in this proposed change: â€Å"Depends on the degree of implementation of the marketing concept throughout the company†. (Bernard, 1987) Ford is just one company who realise that the marketing must not be confined to the marketing department but must be organisational wide pervading all functions. Ford has used marketing for many years in the form of advertising and public relations. Now Ford are using the marketing discipline throughout the organisation they are achieving far better results. However, many companies struggle in implementing this concept due to a lack of understanding. â€Å"Much of the confusion over the years in defining marketing and understanding the marketing concept results from a failure to make these three distinctions between marketing as a culture, as a strategy and as a tactic† (Webster, 1992) This quote is referring to the error that many companies make that marketing is simply just advertising and selling rather than identifying the needs and wants of their customers and satisfying these desires through marketing information and strategies. Ford have attempted to combat such errors by hiring more marketing people who understand these concepts and are able to clearly outline the company†s marketing objectives in order for all staff to understand these objectives, and in turn create satisfied customers. In order to satisfy these customers Ford must truly understand the psychological and social factors, which determines the customers† action. â€Å"Market orientation is the organisation wide generation of market intelligence pertaining to current and future customer needs, dissemination of the intelligence across departments an organisation wide responsiveness to it†. (Kohli and Jaworski 1990) This highlights that in order to maximise the relationship with a customer through marketing, a strong intelligence system must be developed to understand the current expectancy level of the customers. To enable Ford to gain this information they conducted a market research survey of existing customers and discovered that after sales service was of paramount importance to their customers. Ford then devised and implemented a new customer service department, providing solutions and care to their customers. This came in the form of Ford Business Solutions allowing one point of contact for the customer without them being shunted around between departments looking for the appropriate member of staff to deal with their problem. This allowed relationships between the company and customer to flourish. By significantly differentiating themselves from their competitors Ford have created outstanding value for their customers and also in turn they will find it easier to quickly anticipate their customers forthcoming needs due to the better understanding of the customer. This clearly illustrates the marketing philosophy permeating through the company and adheres to the following definition. â€Å"Placing a major emphasis on the analysis of the target markets needs and wants, and delivering the desired satisfaction more efficiently and effectively than competitors†. (Kotler 1996). The next step in the marketing objectives outlined by Ford was to assign brand managers to each product line. The main reason for this was to enable them to clearly understand the target market that a particular product line was aimed at, and in turn improve effectiveness and develop this consumer orientation accordingly. â€Å"The necessity for firms to identify the basic customer needs and wants and define their product accordingly†(Levitt, 1960). This idea has been clearly illustrated in the tactics employed by the brand managers of Ford. The customers who buy different products require different features and benefits from them and the brand managers at Ford must try to understand this and differentiate their product from similar products offered by competitors. An example of this within Ford is what added extras now come as standard with the product due to the customers needs and expectations escalating. Air conditioning, air bags, power steering and A.B.S. are features, which would have been paid for as extras only a few years ago, are now however appearing on the standard model of most of the Ford cars. This indicates that the brand managers, manufacturing team and the product development staff are effectively utilizing the marketing concept. â€Å"We have had some very innovative ideas and campaigns as a result of having people focus on a particular market†. (Hazel, Marketing manager Ford). The production and design team were also educated in the marketing concept to ensure this newly adopted marketing philosophy reached all functions of the business. By introducing the production and design team to strategies such as market research they were able to understand the customer they were designing and building the product for. Through this research it was discovered that the customer no longer wanted the box shaped cars which the majority of car manufacturers were producing, but the consumers were beginning to desire a more aero dynamic look. Ford was able to react extremely quickly to this by releasing models such as the Ford KA and the Ford Focus. Older models such as the Ford Fiesta were rejuvenated and also giving a new aero dynamic shape. â€Å"This promotes a more pragmatic assessment of the market place – one which is likely to reveal the customer as being at the heart of the organisations strategy process – a partner of the organisation†. (Nwanko, 1995). â€Å"A truly high profile customer oriented organisation will, for example define its product in customer specific terms†. (Nwanko, 1995). Ford achieved this through the launch of a customer magazine. The Ford magazine plays a pivotal role in the development of customer loyalty and prospecting programme to cement and improve Fords position as the United Kingdoms number one car manufacturer. The marketing philosophy is the major focus within the magazine; this is highlighted in a study using 40 focus groups concentrating on the target audiences and to create a reader empathy with a major feature on â€Å"Why I love my Ford† a photojournalism essay rare in such customer magazines. This allows Ford to build strong relationships with the customers. Ford has also understood that measuring the satisfaction of the customers is a key element in the marketing philosophy. Therefore in addition to the thoughts on the product survey they have introduced a satisfaction and service experience survey. Studies are done as early as 90 days and as long as four years after the initial purchase. This definitely implies that Ford are beginning to successfully implement and understand the importance of this concept and how all departments have a part to play. Ford brand sales and service satisfaction continues to improve every month and so far in 2002, both measures are indicating an all time high. This would clearly indicate that there is a certain degree of success with the introduction of the marketing philosophy and highlights the importance of it being shared by all functions in customer terms. Internal and third party measures of satisfaction provided by Ford credit and Hertz are also tracked. The customer in the provider contract category in a 2001 consumer financing study rated Ford credit highest. Internal satisfaction studies showed 84 percent of customers who finance or lease with Ford credit were completely or very satisfied and 90 percent would recommend Ford credit to friends and family members. With the introduction of such ventures throughout the organisation it would appear Ford have a high degree of implementation of the marketing philosophy through all functions within the organisation. â€Å"The marketing philosophy focuses directly on three key issues of customer orientation, integrated effort and profit direction†. (McGee and Spiro, 1998) This quote highlights the three key aspects of the marketing philosophy and it would appear that Ford have adhered to this basic framework, although it is imperative that Ford do not rest on their laurels and must continue to develop this philosophy to maintain market share or achieve potential growth. The aim must be to move to the next level of connecting with customers, and how they can introduce the new products they are launching to them. One key tactic, which would allow Ford to do this would be to attempt through marketing communications to latch onto a few small differences between their own products and the products offered by competitors and advertise these differences heavily. Managers at Ford must also continue to be aware of the crucial role that market research can play in the company achieving this customer orientation. The role of market research in a customer orientation context is of extreme importance. It is imperative that Ford continue to constantly conduct market research in order to identify new and existing customers and their needs, help to set performance indicators, and in monitoring the companies† performance progress and finally to gain the information to help with the successful introduction of any changes. Such a process would ensure the continued development of the marketing philosophy through the organisation. If Ford can do this they will continue to be successful in the implementation of the marketing philosophy. â€Å"Research indicates that companies which focus on boosting loyalty among customers and staff will reap the long term benefits†. (Donkin, 1997) Ford must also understand that to achieve this the top level management must be focused on the marketing orientation. â€Å"The pursuit of customer driven goals requires, first and foremost, a customer oriented attitude on the part of the organisations top leaders and customer driven organisational systems†. (Felton, 1959) Therefore top management must be aware that to effectively implement this marketers should be leading cross functional teams to ensure this pan company marketing works as these marketers would ensure the following was properly managed: â€Å"Customer focused techniques such as total customer experience and customer relationship management and correctly measuring every part of the organisation was evaluated against what it has contributed to these factors†. (Simms, 2000). â€Å"Strategic customer orientation management presents a new opportunity for organisations and should be regarded as a positive and competitive marketing tool. A way forward is for managers to pay serious attention to the internal dynamics of the organisation: systems and structure, which were supportive of, and well attained to an overall culture of customer orientation† (Nwanko, 1995) Ford are a company who seem to have understood this idea and set up a structure which allows support for all functions of the organisation to optimise the results of the customer orientation and hopefully gain new customers through this and retain existing customers in order to expand the business. It is clear that Ford have had considerable success due to implementing the marketing philosophy throughout all internal functions of the organisation functions, however they must continue to develop this using the recommendations previously made. Constant monitoring of customers and their needs and wants in conjunction with analysing the actions of competitors is imperative for Ford to maintain or grow their market share .If Ford can do this they will have achieved their ambition of transforming from a solid performer as an automotive manufacturer to a superior performer as a customer focused company.