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Home Articles from Tom Clason Unions vs. Management – Who is the “Bad Guy”? - Large Orders

When orders start coming in large numbers, management will go into a hiring frenzy. They do this because they don’t want to take a chance on missing out on market share. The window of opportunity, especially for new product lines, can be very small and management is myopic when it comes to dealing with growth. They treat hiring and firing, as well as layoffs as a simple and effective method of dealing with the ups and downs of business.

The problem with this approach is that, while it is simple to just shuttle workers in and out, it is not the most effective way of dealing with growth. The most effective way of dealing with growth is to ensure that productivity precedes growth, or at least is in concert with it. Companies start up as mean and lean and find a way of becoming slow and fat. It is only after the metamorphosis that they call in people like me to help them find the way.

 

I often like to use the Navy Seals as an example of what growth should look like. To make this example simple, I will just say that if at any time it is decided that more Seals are needed; do you think that they will just hire a bunch of regular sailors and call them Seals? No, what will happen is that the “ramp up” will require that the new Seals be as good at their jobs and just as tough as the men preceding them. Growth will happen, but it will be accomplished the correct way and with no loss of productivity.

Unions were created to ensure that the workers got a fair deal with management. They work to improve the financial status of the worker now, and in the future when they are ready for retirement. Their strength is in their numbers because management cannot take advantage of a few workers without facing retaliation from the membership. To avoid strikes which would be devastating to the company, management often gives in to the demands of the unions.

 

Strike avoidance sometimes pays off for the short term but comes back to cause problems later. The problems created later could be enough to sink a company. The sinking will be slow in most cases but very certain. Some examples of this can be seen today with the problems being experienced by GM and Chrysler. I know this to be true because I visited a Detroit plant about 10 years ago looking at setup reduction accomplishments there that related to the auto paint process. Essentially, the visit involved learning how they accomplished the changing from one paint color to another in less than a minute without removing the paint head.

I observed during that visit that there were new rules that were initiated by the unions to disallow certain tasks from being completed by anyone other than the person assigned to that task. In short, it meant that there could be no assistance given to a person by anyone not currently “certified” as qualified to do that task. The word “currently” is important here because it meant that even if a person was perfectly capable of doing the task, meaning that he or she had experience in that area but had moved on from that job to another that may have paid more; if he or she was not presently assigned to that task, they could not help. If an employee at a single person station was missing, the line stopped because nobody else was allowed to move from their job to help fill the void.

If the importance of this ruling is not apparent to you, it is because you do not understand the concept of the integrated work team (IWT). In an IWT workplace, everyone can do any job, including the foreman or lead. What this means is that workers “fold” to cover or assist an employee that is suddenly missing or overloaded with work. It is based on the belief (and truth) that an integrated work team will ALWAYS outperform a group of individuals.