This paper aims to critique Pfeffer and Veiga’s article “Putting people first for organisational success”, published in the Academy of Management Executive, Vol. 13. No. 2 in 1999. The premise of this article is that organisations’ success is fundamentally based on the quality of people and the ability of the organisations to invest in their management. While this concept might seem axiomatic, reality begs to differ. Companies, either due to lack of conviction or as a part of ineffectual attempts to increase the bottom line, often ignore the piling empirical evidence that point to a strong correlation between financial success and its commitment to people focussed management practices. In other words, actually believing in the phrase “ people are our most important asset” (Pfeffer & Veiga 1999, p.37).
With organisations moving towards a ‘lean and mean structure’ , the authors believe that unthinking outsourcing and downsizing are only short term remedies to increase profit (Pfeffer & Veiga 1999, p.37) . The article centres around seven practices of successful organisations that emerge based on research across industries and nations.
Provide employment security.
Self-managed teams and decentralisation as basic elements of organisational design
Comparatively high compensation contingent on organisational performance
Reduction of status differences
The above practices outlined by the authors challenge the most commonly held beliefs about management. They further go on to debunk the ideas that to employ these practices, it is necessary to work in the right sector while maintaining the size of the organisation and that it is essential to have a global presence. The authors also believe that downsizing is actually dispensable.
The authors objectively demonstrate the logic behind placing the work force in the centre of the management practise and compellingly argue that focussing on employees will lead to long term success as opposed to short lived financial gains achieved through downsizing and outsourcing. The arguments made by the authors stand to reason because of the huge empirical evidence backing their claims. The authors question long held orthodox beliefs on banking on tradable monetary assets and high light the significance of valuing the work force in organisations spanning industries and countries.
The authors substantiate their claims of people oriented focus by providing insights into why and how this method would benefits organisations in general. This is supported by not only hard evidence, but also practical examples like the case of Dunlap and South West Airlines.
The authors convincingly argue that most organisations do not significantly take into consideration the capabilities and organisational culture when a change is being planned and implemented. Pfeffer, in his book The Human Equation, also states that largely due to the alignment of...