High-Involvement Organization

High-involvement organizations are characterized by flat organizational structures with product- or customer-focused units rather than functional centers such as marketing, production and research and development. The management systems in high-involvement organizations involve participation in all aspects of the organization. Improved human resource management is an important element, and high-quality involvement by employees in those systems is necessary even though their involvement may be challenging at times. In addition, procedural justice and distributive justice are important elements in the successful implementation of high-involvement strategies.

As suggested by Edward E. Lawler III, there are four keys of involvement management: power, information, knowledge and rewards.
Power means that employees have the power to make decisions that are important to their performance and to the quality of their working lives. Power can mean a relatively low level of influence, as in providing input into decisions made by others or it can mean having final authority and accountability for decisions and their outcomes. Involvement is maximized when the highest
possible level of power is pushed down to the employees that have to carry out the decisions.

Information means data, including information on the quantity and quality of business unit output, costs, revenues, profitability, and customer reactions. A major challenge for managers developing a high-involvement work system is to create an information system that provides employees with data that is timely and relevant to their particular work process, that they can influence personally by either expending or withholding effort, and that they can understand.

Knowledge, or employee skills and abilities, can be distinguished from information, which is the data employees use to make decisions and take action. Improving employees' knowledge means a commitment to training and development. The training investments are essential in a high- involvement organization because when employees are making important workplace
decisions, it is important that they have the skills and abilities to make the right decisions.

The rewards component of the high-involvement equation means rewarding employees for expending discretionary effort to enhance organizational performance. A key element in the high-involvement equation, rewards for performance ensure that employees use their power, information and knowledge for the good of the firm. Firms with high-involvement philosophies are most likely to introduce compensation strategies that reflect that philosophy. High-involvement firms typically have team-based rewards, strategies that include variable pay programs (skill-based pay, gain sharing, employee ownership) and flexible benefits.

High-involvement organizations are most likely to occur in complex, unstable environments, with a prospector strategy (a focus on identifying and exploiting new opportunities quickly), an intensive nonroutine technology that produces ideas and a highly skilled workforce. Structures within an organization can either aid or constrain the firm's strategy. In some organizations, their implementation was either not effective or even deleterious.

Generally speaking, best practices in high-involvement management involve the optimization of job security and enrichment, empowerment and autonomy, the development of skills, open communication and less emphasis on status. These characteristics are also supported by compensation strategies that relate to employee skills/competencies and performance. High-involvement strategies are based on the premise that adoption of these practices will increase productivity and output, decrease absenteeism and turnover and generally create a better workplace culture, although this approach is not without challenges and there is no guarantee of success.
When an organization tries to make the transition from control style to a high involvement style, the managers in the organization will likely be seen as the villain who resists the new direction and fails to support the change process.

Often this occurs because the manager’s role gives little ownership over the “new way of managing”. The managers may feel that they can do little to change the management style, as they trapped within traditional system which often makes it impossible to adopt high involvement practices.

Many literatures are making the case that participative management/ high involvement management offers a competitive advantage, particularly to high technology company that face stiff international competition.