Business Improvement Models

Introduction

A longitudinal study of business improvement models: cross purposes or congruity? Joy Taylor and Rodney McAdam The authors Joy Taylor a is Lecturer at the Business Institute and Rodney McAdam is Reader in the Faculty of Business and Management, both at University of Ulster, Newtownabbey, Belfast, UK Keywords Business improvement, Small to medium-sized enterprises, Case studies, United Kingdom Abstract The end of the last and the beginning of this century saw an increasing interest in business improvement (BI). BI tools and techniques have their roots in improving quality and the maintenance of quality systems. In response to the decline of the UK's competitiveness in world terms the Government spearheaded the adoption of interventions including a raft of quality mechanisms. There is a considerable amount of literature describing the application of each of these models, their advantages and disadvantages. However, there is a paucity of studies that comparatively analyse BI models derived from different philosophical and practice based origins. Focuses specifically on the value-addedness resulting from the adoption and implementation of Investors in People and the Business Excellence Model (BEM). Before addressing the models discusses the environmental factors driving their development and diffusion; describes and critiques IIP and BEM showing the complementary linkages; and discusses a longitudinal study of the implementation process in a hotel context. Concludes with recommendations for BI adopters. Electronic access The Emerald Research Register for this journal is available at http://www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at http://www.emeraldinsight.com/0960-4529.htm Managing Service Quality Volume 13 . Number 5 . 2003 . pp. 382-398 # MCB UP Limited . ISSN 0960-4529 DOI 10.1108/09604520310495859

The end of the last and the beginning of this century saw an increasing interest in business improvement (BI). BI tools and techniques have their roots in improving quality and the maintenance of quality systems. In response to the decline of the UK's competitiveness in world terms the Government spearheaded the adoption of interventions including a raft of quality mechanisms. The mechanisms include the Business Excellence Model (BEM), ISO 9000, Benchmarking and Balanced Scorecards. One of the more recent interventions is the standard Investors in People (IIP). Here, IIP is compared with the BEM. The two distinctive, though complementary, models for organisational improvement leading to competitive advantage hold interest for organisations and academia. Interest focuses on the value-addedness gained by adoption of the BI model; the implementation process itself; and the benefits to be achieved at individual and organisational level. Prior to examining the models in detail there is a discussion of the background environment and factors driving their development and subsequent diffusion. Next IIP and BEM are compared and critiqued with linkages highlighted. The impact of implementing the principles of BEM to an IIP organisation is discussed. Discussion of the models is supported by a longitudinal study in a hotel context. The paper concludes with recommendations for BI adopters.

Contextualisation of business improvement approaches The early twentieth century brought a mechanistic view of organisations and production in particular. Two BI approaches Business Process Re-engineering (BPR) and Total Quality Management (TQM) emanated from this period. BPR and TQM owe their ethos and structure to the ideologies of mechanistic organisations (Peppard, 1995; Burns and Stalker, 1961). Taylorism (Taylor, 1947) had given rise to succeeding related themes, involving information and control theory, work study, and operations. The TQM era of the 1980s and 1990s has the same mechanistic ancestry. This mechanistic view of organisations resulted in the ``tool

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and technique'' approach to quality efforts. Figure 1 shows the cultural shift associated with such BI approaches. The emphasis increasingly is on organic organisations with greater flexibility and more effective communication structures. The Department of Employment's Training Agency's (1987) report, Training in Britain, identified that Great Britain spent less on training than competitors and the skills gaps was widening. The Government responded by establishing a National Training Task Force (NTTF) (1988) and Training and Employment Councils (TECs) ``to promote to employers the necessity of their investing in the skills of the working population'' (Taylor and Thackwray, 1996). Concomitantly research showed that UK companies had been slow to invest in training. Managers received less training and development than international counterparts (Constable and McCormick, 1987; Handy, 1987). Thomson et al. (1997) found that in larger organisations managers receive five days training and just less than this in smaller organisations. Organisations in the 1980s developed specifically-tailored training and development programmes. The programmes were an attempt to achieve better results. Some organisations made representations to the NTTF, a coalition charged with the

responsibility of developing a mechanism to harness the often hidden potential of organisations. At the same time the CBI (1989) report Towards a Skills Revolution identified the ten principles of an Investor in Training. The principles of Investor in Training and the CBI's conclusions formed the basis of the NTTF's deliberations. These deliberations resulted in the initiative, IIP. At the organisational level most innovations result from borrowing rather than invention (Cohen and Levinthal, 1990). IIP ``borrows'' from other initiatives to create an approach ``which sets the level of good practice for improving an organisation's performance through its people'' (Investors in People, 2000). Although it is generally recognised that improving workforce skills is critical, the rate of adoption of specific initiatives appears to be low (Table I). Lee (1996) suggests that where the organisation is on the maturity continuum determines the predisposition to innovative practices. The advance of TQM and associated BI initiatives in both the USA and the UK in the 1980s and early 1990s, seemed to promise a utopian mix of business success and employee satisfaction. The change initiatives gained impetus due to increasing business competition from the Far East, Japan in particular.

Figure 1 Relative cultural shift of BI approaches

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Table I Diffusion of BI initiatives in UK Approach Main focus

Evidence of diffusion in UK

IIP

Training and development of people in line with organisational goals: Commitment Planning Action Evaluation

Limited (16,641)a

BEM

Leadership People Policy and strategy Partnerships and resources Processes People results Customer results Society results Key performance results

Increasing interest (10,500)b

Little cognisance is given to people. People, or the individual employee, is central to IIP. IIP focuses on individuals and their role in developing organisational competitiveness. IIP is underpinned by the three beliefs of: (1) the existence of definable standards of ``best practice''; (2) a direct relationship between certain management practices and organisational performance; and (3) the universal applicability of best practice (Alberga et al., 1997). The next section describes, critiques and compares the BEM and IIP models.

Description, discussion and comparative critique of IIP and BEM

Sources: As at May 2000 from aIIP (UK); bBritish Quality Foundation

As TQM programmes began to yield significant business organisational improvements in the late 1980s and early 1990s, comparisons were made with ISO 9000. ISO 9000 has the implementation frameworks and supporting measurements lacking with TQM. In 1992 the BEM was developed to incorporate the principles of TQM in an implementation framework with a set of measures. BEM enables organisations to measure their progress on the ``TQM journey'', but applying BEM is not synonymous with applying TQM (Dale and Lascalles, 1997). The BEM is not TQM. BEM is, however, derived from TQM principles, shares the underlying assumptions of TQM. The shared assumptions include: . An ancestry of mechanistic thinking through its association with TQM. . Dependency on a mechanistic view of the organisation, as distinct from an organic view (Spencer, 1994). This view is reflected in the language associated with the model, ``assessment'', ``scores'', ``criterion parts'' and ``top down''. . A cause and effect relationship through the use of ``enablers'' and ``results'' criteria. This positivistic outlook ignores the possibility of more phenonomenologically-based outcomes. The BI initiatives, ISO 9000, TQM, and the BEM, focus on improving the quality of the product and the services provided or systems.

IIP The standard The broad objective of the standard is to ensure that the training and development of personnel is in line with the organisation's clearly defined goals. A total of 12 indicators that impact the key business themes underpin the standard's four elements (Figure 1) The elements or principles are commitment, planning, action and evaluation. The key business themes are business planning, communications, management roles, employee development and evaluation (see Table II). Criteria may be related to one or more of these themes. Assessment is by an independent, trained assessor. The assessor measures the evidence provided against the standard. IIP is not prescriptive in evidential terms. Organisations may decide on the approach to preparation for assessment. Alternative approaches include the traditional portfolio and the Building a Better Business (BBB) (Investors in People (UK) and Scottish Enterprise, 1997) model. Sufficient information should be provided to allow the assessor to form a comprehensive picture of the organisation prior to the site visit. During the site visit the assessor probes the evidence provided and interviews staff as per the pre-determined profiles required by IIP (UK). The predetermined profiles include the categories of age, sex, qualifications, length of service, and disability (Investors in People, 1997). BBB is a self-analysis tool designed specifically to help SMEs evolve towards IIP. BBB recognises the importance of ``quick

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Table II Investors in People standard

Commitment An Investor in People is fully committed to developing its people in order to achieve its objectives 1 The organisation is committed to supporting the development of its people 2 People are encouraged to improve their own and other people's performance 3 People believe their contribution to the organisation is recognised 4 The organisation is committed to ensuring equality of opportunity in the development of its people Planning An Investor in People is clear about its aims and objectives and what its people need to do to achieve them 5 The organisation has a plan with clear aims and objectives which are understood by everyone 6 The development of people is in line with the organisation's aims and objectives 7 People understand how they contribute to achieving the organisation's aims and objectives Action An Investor in People develops its people effectively in order to improve its performance 8 Managers are effective in supporting the development of people 9 People learn and develop effectively Evaluation An Investor in People understands the impact of its investment in people on its performance 10 The development of people improves the performance of the organisation, teams and individuals 11 People understand the impact of the development of people on performance of the organisation, teams and individuals 12 The organisation gets better at developing its people Source: Investors in People (2000)

wins'' to smaller organisations with little or not organisational slack. SMEs measure themselves under the eight ``elements'' of business direction, key results, your people, employees in new jobs, training and development, managing performance, plan for the business, and external review. Built-in ``quick wins'' are designed to encourage businesses to continue their commitment. The recognition process The local recognition unit manages and quality assures the recognition process as determined by IIP (UK). In Northern Ireland the Department for Employment and Learning (DEL), formerly the T&EA, are the recognition unit. The assessor works on behalf of the recognition unit. Organisations, deemed by the assessor to meet the criteria, have their case presented to the recognition panel by the assessor. The recognition panel ``provides the assessment process with an objective, external, input from individual employers whose primary interest is to ensure that the standard is maintained and interpreted consistently'' (Investors in People, 1996). Recognition is for three years in the first instance.

The critique The benefits cited from adopting IIP include improved business planning, increased competitiveness, and reduced absenteeism (Alberga et al., 1997; CENTEC, 1996; Investors in People, 1995/1996; Parsons, 1995/1996; Jackson, 1995). Other benefits include: . more effective integration of HR policy and practice with organisational strategy; . greater top management commitment to developing employees; . more opportunity across organisations for continued learning and education; . employees being more aware of organisational goals; and . downward communication (Alberga et al., 1997). The recognition journey itself is presumed to have benefits for the employer. The benefits may only become evident after management processes have changed and training initiatives have started to pay off. The anticipated pay off being enhanced organisational performance. However, organisations attributing enhanced performance to IIP make no direct link between IIP and an improved bottom-

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line (Lee, 1996). Equally, organisational planning remains unaffected by IIP (Alberga et al., 1997). Where organisations develop distinctiveness they identify benefit in the form of performance gains associated with the planning process. Distinctiveness in this context involved the development of their critical asset, the people. Developing distinctiveness increases competitiveness (Merckx and Burnstead, 1990; Rigby, 1998; Barney, 1991; Reed and de Fillippi, 1990). Many of the benefits of IIP are intangible. Intangible benefits include those benefits expressed in non-financial terms. Accountants measure benefits that cannot be expressed in financial terms as ``pay forward''. ``Pay forward'' may be in the form of ``cultural/behavioural changes individual or team behaviour, or other changes'' (Lee, 1996). Pay forward returns on investment are difficult to quantify. The benefits of implementing IIP are in many cases perceptual or ``feel good'' factors. Likewise, the problems are sometimes ``feel bad'' factors, intangible and immeasurable. Other benefits included the positive effect on the company's image, the potential for better quality recruits, a reduction in workforce turnover, and vacancies filled more easily. The BEM The model The BEM is widely described in literature (EFQM, 2001). The model is composed of nine criteria, five ``enabler'' criteria and four ``results'' criteria (Figure 2). Each criteria has more prescriptive criterion parts. BEM is applied within organisations through a process of self-assessment. The Figure 2 The BEM ± elements and criterion parts (European Quality Award for SMEs)

self-assessment team (SAT) is an ad hoc group of internal agents mandated to assess their organisation against each criterion. The selfassessment process identifies strengths and areas for improvement; and allocates scores for each criterion part. The maximum score of 1,000 points is based on ``best practice'' scoring. The assessment The two key areas of measurement are: (1) self-assessment and the scoring process; and (2) the results criteria. The self-assessment and scoring process is based on the principle of demonstrating adherence to each sub criterion scoring element. Weighting is applied to the overall scores for each criteria (Figure 2). Weightings are based on averages for those organisations involved in the formation of BEM in 1992. Since 1992 BEM has undergone only minor adjustments, weightings have remained unchanged. The BEM involves all areas of the organisation and provides an opportunity for assessment against a pre-determined benchmark. The benchmark includes the assessment criteria and scoring. Effective organisations achieve a score of >400. The highest enabler weightings are for leadership and processes, highest results weightings are customer results and key performance results. Leadership and processes provide critical support pulling towards customer results leading to key performance results. The critique The BEM self-assessment team identifies and reaches consensus on the evidence requirements for the ``approach'' and ``deployment'' elements, and the ``excellence'' and ``scope'' composition of the results. Progress towards agreement on strengths and areas for improvement is usually straightforward. The allocation of a score is more problematic. In spite of intensive initial training experienced assessors can record scores with large variations. Variations can be as much as 50 points and need to be reduced to an acceptable bandwidth. An acceptable bandwidth for the European Award process is deemed to be 20 points. The mean is taken as the final score. The problem of achieving an agreed score is a microcosm of some of the schisms within TQM.

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A culturally based consensus approach using empowered team members is degraded by the questionable necessity for the mechanistic outcome of a score. Scores, it is argued, are essential for benchmarking. Benchmarking uses the scoring in the initial stages. Later stages focus on people and process issues relating to the strengths and areas for improvement. Obviously the weightings cannot represent every organisation. In particular, the size, sector, and lifecycle stage of an organisation affect the optimum weightings. Thus, the ``one right way'' approach of the BEM could be misleading to many organisations, particularly SMEs and public sector organisations which have different issues and drivers from the large private founding companies of the BEM.

Comparative analysis Virtually all approaches to BI emphasise the importance of organisations focussing on customer needs. The internalisation of customer needs by all levels of employees is of paramount importance. The importance of customer requirements linked to organisational and hence employee goals and targets is demonstrated by quality function deployment (QFD). QFD has the customer as the focus enabling a company to design and manufacture products to suit a market's specific requirements. IIP and BEM aim to increase organisational competitiveness. Organisational competitiveness leads to national competitiveness. National competitiveness is perceived to result from a commitment to continuous improvement. IIP has closer innovation-values fit with organisations with organic characteristics whereas BEM fits more closely with a more mechanistic style. For example, to achieve IIP employees are encouraged to identify realistic training and development needs in line with organisational goals. Internal lateral communication encourages commitment and responsibility resulting in increased knowledge, expertise and prestige. Mechanistic organisations offering products or services tend to have specialised differentiation of functional tasks. In these organisations senior management retain

knowledge and function by merely issuing instructions and decisions. IIP is the result of the dual process of external independent assessment and the concurrence of the recognition panel. BEM is about self-assessment against pre-determined scores first identified in the early 1990s. BEM reflects differences in both size and public versus private sector organisations. IIP is constant for all. The BEM is built upon a process based view of organisations. The process criterion is the highest weighted enabler within the model. The process factor is reflected in the recognition of business processes as a central tenet of TQM. Inherent within this approach is an assumption that any type of organisation can be modelled on a series of business processes. However, there are different levels of affinity between organisations and processes. For example, Dupont, a large global chemical producer, is more suited to process based analysis than a local government support agency. Furthermore, the process approach within the BEM is largely mechanistic. Processes are more closely linked with material objects than people issues and flows of knowledge. The BEM encourages empowerment and employee growth and development by promoting processes as a partial alternative to business functions where employees are restricted to a strict hierarchical system. Organisations such as Federal Express are ``inverting the pyramid'' by recognising and empowering customers facing employees. Wilkinson and Willmott (1994) argue that the ``internalisation of the market ethos'' is really a ``commodification of internal relations'', where the rhetoric is of empowerment but the reality is increased workloads and stress. In this situation employees do not obtain a ``power shift'' but become morally bound to the customer ethos and ultimately their own exploitation. Cook and Macauley (1997) describe empowerment in relation to customers as ``employees given the authority and responsibility for serving the customer speedily and efficiently''. Further, ``employees must know the level of authority they have to deal with complaints'' and that ``managers need to be explicit about how far and what sorts of things this means'' (Cook and Macauley, 1997). Arguably this approach is about getting more out of employees, resulting in raised stress levels while still

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under the management ``gaze'', and no extra remuneration. Empowerment ``can simply mean shouldering more responsibility for less reward'' (Clutterbuck and Kernahan, 1994). The TQM movement implicitly infers that empowerment can be packaged within models and methodologies. For example the European BEM has only a part of one criterion directly related to empowerment. Increasingly change managers are asking can a socio-political issue such as empowerment be packaged neatly within a rigid framework? Is a different paradigm needed to shed light on this issue? In this approach empowerment is seen as something that can be measured in terms of numbers involved in project teams or numbers of suggestions in a box. Leesem (1992) calls for true empowerment that will result in ``inner directed learning'' which produces ``outwardly directed innovation'' or BI. Zuboff (1988) points out that the: . . . empowered freedom of intelligence must be brought back to the workplace and that the automated mechanised methods of yesteryear must be replaced with the informated and intelligent technological workplace of tomorrow.

From an empowerment standpoint the values approach of TQM has considerable limitations. For example ``shared'' values usually refers to sharing within the management team, not management and employees. The people issues within the BEM are always constrained within leadership and business boundaries. A key people measure is the level of involvement of employees in TQM projects. Wilkinson and Willmott (1994) point out that it is often taken for granted that employees welcome this involvement. Typical statements or values in regard to this issue include ``the responsibility for quality is in the hands of those who do the work'', but this approach results in employees becoming more identified with the aims of the corporation than true empowerment (Wilkinson et al., 1992). Overall the BEM's concept of empowerment is largely contained in the three key criteria, leadership, people, and processes. In leadership empowerment is seen as being encouraged by coaching, mentoring and accessibility. In people empowerment is seen as involvement, two-way communication and career development. In processes empowerment is seen as employees being

involved in changing work based processes. Although once again the concept of empowerment is limited largely to involvement it is encouraging to note the increased references to employee learning and social well-being comparing the model editions between 1994 and 2001. Studies show the more the vision is realised, the less empowerment employees achieve (Rees, 1996). A key reason is that often where the people objectives are dropped there was no managerial commitment to them in the first instance. Table III shows the main foci of the two BI models. Figure 3 demonstrates the main linkages between IIP and BEM. IIP fits largely with the enablers section of BEM. Business results cannot easily be integrated with IIP. IIP, therefore, has the potential to act as an appropriate entry point to the BI arena. Embeddedness of the principles of IIP help move the organisation along the continuum to BEM (Maynard, 1995).

Research methodology The case study is a complex and multifaceted approach (Yin, 1984). Case studies involve full contextual analysis of fewer events or conditions than other approaches. The case study approach provides valuable insight for problem-solving, evaluation and strategy building or where understanding is essential (Shipman, 1981). Major strengths of the approach include the multiple sources of information reducing the possibility of missing data and the verification of data (Cooper and Schindler, 1998). Data verification is enhanced by triangulation. Triangulation involves observation, accounts by participants, changes in accounts and interpretation of events as time passes. Marshall and Rossman (1989) refer to Kennedy's (1979) first and second decision spans that allow the researcher: ``. . . to generalise the findings about a particular sample to the population from which that sample was drawn'' and ``. . . apply the findings about the population of interest to a second population believed or presumed sufficiently similar to the first to warrant that application''. The origins of the case history approach lie in the arena of medicine. Medical doctors'

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Table III Comparison of business improvement initiatives Dimension

IIP

BEM

Structure

Four elements or principles and 12 indicators

Enablers and results ± nine criteria and 33 sub-criterion parts Socio-technical roots Developed from TQM in 1992 Relatively minor revision in 1997

Historical Developed in 1990 to increase development competitiveness Revised 2000 Underlying assumptions

Mechanistic Continuous improvement Development of employees in line with Positivistic Cause and effect organisational goals and objectives Limited empowerment Top-down Customer ``pull''

Strategic/ operational

Strategic, but mainly applied to operational

Classified as strategic but mainly applied to operational Some tactical (applying strategy) applications Very little strategic formulation influence

People and processes

People-centred Training and development in line with organisational goals and objectives Individual development linked to team, department and organisation development

Key people management and people result criterion and causal linkages Perceptive people data Limited empowerment models Coach/mentoring leadership Processes is the largest weighted criteria in the enabler section Organisation viewed as a series of business processes People change management Process measures

Dynamic/static

Dynamic Continuous improvement

Mainly static audit role Some dynamics through lead and lag result criteria and enable-result causation No formal predictive capability

Customer focus

No direct link Outcomes demonstrate benefits

Key customer results criteria (most highly weighted) Assumes customer ``pull'' is key Perceptive customer data Encourages benchmarking comparisons

Measures

Indicators Perceptive and non-perceptive data Trend data Target comparisons Best practice benchmarking comparisons

Enablers scores ± for approach and deployment Results scores ± for excellence and scope Perceptive and non-perceptive data Wide range of measures Trend data Target comparisons Best practice benchmarking comparisons

Outcome

Competence

Points awarded

Assessor

External trained auditor

Self-assessment team

Assessment frequency

Three-year assessment 12-15 month assessment

Continual

Evidence

Portfolio plus site visit BBB

Perceptive and non-perceptive data

T&EA advisers Government funding

DEL advisers Government funding

Support

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Figure 3 Diagram showing the linkages between the business improvement models, IIP and BEM

understanding is largely built on their ability to learn from single cases (Gummesson, 1991). Gummesson (1991) argues that: the possibilities to generalise from one single case are founded on the comprehensiveness of the measurements which make it possible to reach a fundamental understanding of the structure, process and driving forces.

Case studies are also used in law, anthropological studies, both clinical and developmental psychology, political science, social work, management and education research (Burns, 2000). The case study is particularly worthwhile where the desired

outcome is theory generation or the initiation of change (Kjellen and Soderman, cited by Gummesson, 1991). Three ingredients that underpin the case study method are the capability to deal with a diversity of evidence, the ability to articulate research questions and theoretical propositions, and the production of a research design (Yin, 1998). Research design encapsulates the activities right from the outset or the problem statement, through to the end, the hypothesis testing (Sekaran, 2000).

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The case study approach may involve relatively intensive analysis of a single instance of a phenomenon being investigated. The relational processes and patterns are first presented and then interpreted through case history analysis (Sekaran, 2000). Theories are developed from the cases researched (Eisenhardt, 1989). Yin (1984) argues that cases are not ``sampling units'' and should not be chosen for this reason, rather individual cases should be selected in a way similar to that used by a laboratory investigator. The laboratory investigator selects the topic of a new experiment as something to be explored, understood and/or described (Yin, 1984; Hamel et al., 1991; Winterton and Winterton, 1999). Where two or more cases support the same theory, replication may be claimed (Yin, 1984). Chosen research methodology The research strategy chosen was the exploratory case study. Case studies can employ an embedded design at numerous levels of analysis (Yin, 1984). The case study focuses on understanding the dynamics present within single settings (Eisenhardt, 1989). This longitudinal study is based on two IIP organisations where the principles of BEM have been applied (Bolton and Drew, 1991). The study focuses on the changes as a result of implementation including staff and customer attitudinal responses. Also an examination of the tangible and intangible changes since adoption of the BI initiative provides supporting evidence for the argument that the greatest benefits are in the implementation journey itself. The first analysis, carried out in 1997, was part of a larger project. The follow-up analysis was completed in 2002. In this instance two cases were chosen for close examination. The main research questions are: . What degree of compatibility exists between the two models? . What organisational learning and transferability of learning emanates from the adoption of incremental BI mechanisms? . What should adopting organisations do when incorporating one or both BI mechanisms? Figure 4 presents the research methodology.

Figure 4 Research methodology

The pilot study A pilot was conducted prior to the full study. The pilot had two foci. First, it tested the appropriateness of the questions to provide response adequacy and second, it checked the suitability of the approach. A questionnaire was specifically adapted to be used in structured interviews. The interviews assessed the changes experienced by staff as a result of the adoption and implementation of a business initiative, in this case IIP or BEM. Before using the questionnaire the questions and underpinning philosophy were discussed at length with two practitioners from different organisations. One practitioner, an experienced IIP assessor, headed the human resource department of a large public sector organisation. The other practitioner had recently moved to the position of marketing director of a private sector organisation having been the human resources director for several years. Comments and recommendations as a result of these consultations were incorporated into the instrument. The pilot study was conducted in a small local hotel. Other hotels from the same family-owned business were used in the main study. Interviews for the pilot study involved 18 staff. The results confirmed the instrument's appropriateness and response

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adequacy. The instrument provided both qualitative and quantitative data (Hope Hailey, 1977). Organisations in the main study Two local hotels belonging to a family-owned group and situated within five miles of one another were studied. Categorised as SMEs, each hotel has autonomy over staffing and HR procedures. Change, the result of the leadership role passing from father to son, created an impetus towards decentralisation. Budgets and finance are held autonomously by individual hotels. The board of directors sets targets centrally. Wages are set and paid centrally. Employees are inducted into the organisation and receive specific training as and when required. The hotel and catering sector is greatly affected by seasonality factors. Hotel A is situated on the coastline in a former Gothic mansion built in 1876 and was purchased by the group in June 1967. Hotel B is a city centre purpose-built hotel purchased by the group in August 1993. Both hotels have undergone significant refurbishment. Hotel A has been extended from 184 to 240 rooms. At the time of the initial survey hotel A had a staff of 91 full-time, 50 male and 41 female, including those working in an inn and a fitness suite which function as separate entities. The longest serving member of staff has been with the hotel for almost 30 years. Most staff have been employed for less than five years with this organisation. A total of 18 of the 60 staff were interviewed. Interviewees ranged in service from a few months to eight years. In 1997 hotel B had a complement of 198 staff, 70 casual and 128 full-time (116 male and 82 female). More than 140 of the staff are under 40 years of age. No member of staff had been employed with this hotel for more than five years, although a few worked for the previous owners. The study Access to information, sites and staff reflected that required by the assessor. Staff selection for interview followed IIP guidelines. In the initial survey both hotels provided a portfolio and other relevant documentary evidence on request (Sekaran, 2000). Evidence included staff lists, personnel files to demonstrate the training and development undertaken by

staff, schedules for training and development, budgets for training and development and questionnaire results showing training needs, staff awareness of development issues and organisational plans. Confidentiality was maintained by conducting structured interviews in privacy. Interviewees were informed that a follow-up report would be presented to management though individual responses would not be identified. Pre-printed questionnaires were used to record responses. Summaries were checked with interviewees to ensure accuracy. Verbatim notes recorded potentially controversial comments. Hotel and job function details were identified for research purposes only. The research instrument consisted of two parts. Part one addressed issues of training, organisation structure, individual role and targets. Part two contained statements taken from the IIP literature. Interviewees were asked to respond to these statements. Responses were placed on a five-point scale ranging from ``strongly agree'' to ``strongly disagree''. Interviewees were asked to elaborate on their response to the perceptual statements. Interviewees were also invited to comment on initiative implementation in the organisation. The instrument provided both qualitative and quantitative data (Hope Hailey, 1997). The survey methodology combined with the case study approach is used to illuminate relationships (Crotty, 1998).

Discussion of findings IIP Table IV indicates interesting perceptual changes. For example, the response to the statement ``IIP has improved my job `lot' '' shows a significant weakening, particularly in hotel A. This perceptual weakening is consistently shown when individuals are asked to identify personal gains as a result of IIP. Nevertheless almost all individuals were able to cite examples of how they had benefited in terms of training and development. Many had achieved additional qualifications as a result of the organisation's sponsored NVQs. Hotel B staff appear more convinced of individual benefits of IIP. Increasing numbers viewed IIP as

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Table IV Responses to perceptual statements from hotel staff, 1997 and 2002 Strongly agree % 1997 2002

IIP statement Hotel Aa IIP has improved my job ``lot'' IIP is just a paper exercise IIP is just a badge for the front desk IIP is a publicity exercise for the organisation I have gained specific benefits as a direct result of my organisation's commitment to IIP Working in an IIP organisation is an attraction Customers care that our organisation has IIP Customers experience benefits because of IIP Hotel Bb IIP has improved my job ``lot'' IIP is just a paper exercise IIP is just a badge for the front desk IIP is a publicity exercise for the organisation I have gained specific benefits as a direct result of my organisation's commitment to IIP Working in an IIP organisation is an attraction Customers care that our organisation has IIP Customers experience benefits because of IIP

39

18 6

5

Agree % 1997 2002

Response Neutral % 1997 2002

55 5 5

53 41 25

5 15

35

50

33

17

Disagree % 1997 2002

10

Strongly disagree % 1997 2002

44 71

19 42 58

50 9

17 16

16

24

11

9

28

17

61

33

11

8

11 22 50

8 25 17

56 78 50

41 50 47

28

26 17 19

5

25 8 17

33

67 7

51 11 8

13 7 7

8

13 13 7

16 71 42

7 53 59

18 42

27 20

8

38

9

25

28

21

41

16

14

33

47

42

40

17

8

13

16 51 50

40 33 47

42 33 42

47 54 33

8 8 8

13 6

42

34 8

13 13

Notes: an = 18 in 1997; n = 13 in 2002 b n = 12 in 1997; n = 18 in 2002

predominantly having publicity benefits for the organisation. When asked in 1997 whether an IIP organisation would be an attraction if moving job, the majority responded positively. By 2002 the position had weakened with only 49 per cent positive responses from hotel A. A total of 87 per cent of hotel B staff responded positively in 2002 as compared with 58 per cent in 1997. The last two perceptual statements concerned the impact on customers of the organisation being IIP. Again, the overwhelming positive response of 1997 had lessened by 2002. Hotel A's response showed a most dramatic downtown from 100 per cent to 64 per cent. Hotel B's positive response reduced by 12 per cent.

There are many possible reasons for the changes reflected in the responses to perceptual statements: . The results may reflect an increasing cynicism about the standard itself. . The fact that the organisation raised awareness and had embarked on training and development may simply have increased staff expectations. . Increased expectations may account for the shift to less positive responses overall. IIP ± benefits from implementation The organisation benefits from having a managing director who is a member of the IIP (UK) board and is committed to IIP. IIP status was first achieved in 1998. The benefits identified by staff and the organisation since implementing IIP include:

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. . .

.

increased training (ranging from IT training and assessor training, to CIPD and Masters); increased repeat customers; improved communication; increased ``feel good'' about the organisation; and greater awareness of in-house support mechanisms.

Training and development is on-going in both hotels with most staff having achieved NVQs. NVQs and modern apprenticeships are funded by the organisations. Three-quarters of interviewees confirmed receiving induction. All senior staff had undergone neural linguistic programming (NLP) training and selected individuals participated in the company's management development programme (MDP), run in conjunction with University of Ulster at Jordanstown (UUJ). MDP participants received sponsorship for NVQ4 in management. Almost 50 per cent indicated performance improvement. An important consequence of improved individual performance is repeat customers leading to improved overall organisational performance. Internal promotion and a low staff turnover rate demonstrate the impact of individual improved performance. Low staff turnover may simply be the result of poor job prospects for vocational workers with few qualifications. Communication has demonstrably improved. All interviewees confirmed the increased openness of communication. Managers communicate performance targets and give feedback on achievements. Success is celebrated in-house. Not all staff appreciated the organisation's approach to celebrating success. For example, staff who had achieved their performance targets were asked to join the senior management team at the end of their regular meeting to have their achievement recognised. Individually staff expressed a preference for a simple ``thank you'' and requested that the new practice be abandoned. The organisation obliged. Continual quality improvement is limited by little or no organisational slack. BEM In 2000 the organisation considered the adoption of BEM as a vehicle to increase competitiveness. Initially hotel B received advice, information and support on

implementation from the Centre for Competitiveness, formerly the Northern Ireland Quality Centre. Thereafter the organisation continued implementation alone. Implementation of BEM began with awareness raising for the senior management team. The SMT devised a consensus improvement plan (CIP) including SMARTER (specific, measurable, achievable, realistic, time-bound, expanding capabilities and rewarding) objectives. The objectives addressed all aspects of the organisation, from communication to staff rewards and recognition, and from staff comments to customer comments. Each area or opportunity for improvement had action points, a nominated person with responsibility for ensuring action took place, a review date, target and date. For example the CIP identified a need to improve methods of communication from management to members of staff. Six action points were listed with review and target dates identified. Similar CIPs were identified for other areas including methods of recognition, training of staff and staff suggestions. Intervening variables The current economic climate prohibited the organisation's formal pursuit of BEM. In real terms the hotel sector has suffered a downturn in revenue. The downturn is a result of reduced international travel. Northern Ireland Tourist Board's (NITB) visitor figures show a reduction in visitor content, i.e. guests from outside Northern Ireland, from 62 in 1997 to 61 in 2001. Visitor revenue figures show that 8,692,000 stays in 2001 provided £282 million. During the period the number of hotels in Greater Belfast mushroomed with aggressive staff poaching as a result. The culture, environment and training and development offered helped retain staff. Both organisations cited examples of staff returning. Siblings working together perceiving work as a social event strengthen the organic culture. Hotel B has increased to 240 rooms. Room occupancy has not increased and average spend is low. Planning for the minimum wage and working time directive lessened their impact. Flexible working patterns including accommodating school pick up times help workers achieve work-life balance.

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Wage percentages are determined centrally. Hotel B's percentage has remained constant. Hotel A's percentage is 2 per cent less than in 1997. Efficiency and effectiveness gains are the result of greater accountability. Casuals have increased and in one case man the whole department. Legislative changes ensure managers assess an individual's suitability judiciously. The major paradigm shift has been the acceptance of getting the job done within the prescribed working day. Both organisations replaced silver service with plated service. Plated service is cost effective. Customers receive their meals more efficiently, although some perceive the helpings were larger with silver service. Belfast City Airport is less than two miles from hotel A. Business travel has increased by 12 per cent in the period. The preference is for less formal dining and acceptance of ``smart'' dress for lounge dining. Conferences, interview days, presentations and testing are often hotel based. Changes in room allocation and facilities offered, including the refurbished Elysium, have been externally driven. Hard marketing techniques are used to sell the facilities. Follow-up calls are made after events for quality assurance purposes and to book the next event. BEM ± benefits from implementation of principles and practices The implementation journey itself holds the benefits for organisations, not accreditation. Hotel B's decision not to pursue accreditation does nothing to lessen benefit accrual. Evidence is in some cases anecdotal, in others tangible financial benefits have been achieved. Among the benefits cited are: . improved communication from SMT to staff; . improved interdepartmental communication; . improved atmosphere (``feel good''); . celebration of successes; . recognition of individuals; and . savings on fuel costs. The organisation strives to continually improve. Approaches to continual improvement include encouraging employees through empowerment, learning from evaluating past experiences, and encouraging employees to take ownership of their training and development. Increasingly employees are promoted from within ± proof of the

organisation's commitment to continual improvement. Enhanced organisational performance is the result of IIP inculcation together with a degree of embeddedness of BEM principles and practices. The dilemma now is whether, having achieved seamless absorption of IIP and to a lesser extent BEM, there are incremental benefits to be achieved by going for re-recognition of the ``badge''. In other words, the question is: Has inculcation of the principles and practices of BI rendered the accreditation redundant?

Conclusions IIP and BEM are complementary. IIP, the first initiative to focus solely on people, is potentially the most powerful change mechanism. IIP addresses the training and development needs of employees in line with organisational goals and objectives. BEM is a broader initiative that addresses all aspects of the organisation from leadership to processes and from customer results to key performance results. BEM is a self-assessment mechanism for auditing the organisation's progress towards TQM. Criterion three of the BEM focuses on ``how the organisation manages, develops and releases the knowledge and full potential of its people at an individual, team-based and organisation-wide level, . . .''. IIP satisfies criterion three and addresses elements of criterion one (leadership), and criterion seven (people results). IIP therefore, services as a first incremental step in the complex mix of organisational change, people management and implementation of the intervention (Schneider et al., 1996). Schneider et al. (1996) argue that BIP must be top management team led. Change underpinned by incrementalism and organisational learning, i.e. learning from previous experiences facilitates implementation. Gummesson (1991) argues that ``when we give proper weight to local conditions, any generalisation is a working hypothesis, not a conclusion''. IIP's greatest asset is its requirement for continuous improvement, leading to competitiveness. The BEM on the other hand is limited by its mechanistic scoring approach. The limitations of self-reflection may include an unwillingness to acknowledge reality and become truly self-aware.

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IIP and the BEM are founded on assumptions. The BEM is founded on a mechanistic approach to pre-definable cause and effect outcomes. Assumptions common to both include the existence of ``best practice'' and the universal applicability of the models: . Both initiatives have general applicability for all types of organisation. . Organisations achieving IIP are found to be competent at investing in their people to increase competitiveness. Organisations adopting the BEM achieve points quantifying progress towards TQM. . IIP ensures continual improvement whereas the BEM is a more static mechanism. . IIP implementation brings about strategic human resource management changes. The BEM measures progress towards TQM. . IIP requires commitment to the underpinning principles from all levels of the organisation. The BEM requires commitment from the self-assessment team managing the data collection and assessment process. The models, IIP and the BEM, are complementary. The BEM's mechanistic ancestry and mechanistic approach limit its effectiveness. IIP, on the other hand, provides a framework for continual improvement. IIP has the potential to be a very powerful tool developing the personnel beyond individual competence. The case organisations examined in this paper had embarked on a BI process having first identified an enhancement need. The cases demonstrate the tangible and intangible benefits of implementing BI. The biggest improvement identified by the organisations is in communication. Communication underpins everything in an organisation and leads success. Together IIP and BEM have clearly demonstrable transformational capabilities. IIP has the potential to be the most powerful organisational change tool while BEM acts as a useful benchmark. Our primary advice to managers is to underpin the process by communication. We have identified 5Fs in a four-stage process for improvement. (1) Fit. Ensure there is ``fit'' between the organisation and the mechanism.

(2) Fully supported. Ensure the top management team fully support the organisational change. (3) Focus on people. IIP is an appropriate benchmark. The requirement to evidence continuous improvement supports people development in line with organisational goals: . Focus on processes ± having inculcated the principles of IIP then focus on BEM. . Fast-track implementation ± the transferability of earlier learning will help fast-track BEM implementation. (4) ``Finish or close the loop'', i.e. continue to scan the internal landscape checking there is appropriate continual improvement. At the same time we would add some cautionary notes: . Having a focus on quality issues alone does not guarantee permanence in business. Business improvement mechanisms enhance an organisation's potential. Factors such as those identified in a PESTLEM (political, economic, social, technological, legal, environmental and marketing) analysis remain. NI recognition unit figures for 2003 show that 40 organisations have had their accreditation revoked (Department of Education and Learning). Accreditation has been revoked on the basis of closure or amalgamation, e.g. where single hotels have become part of a chain. . Too much and/or too frequent change causes fatigue. Fatigue can be experienced at individual, team and organisational level. . Expect a short-term downturn in effectiveness during implementation. The timescale involved will depend on positioning on the training maturity continuum (Lee, 1996).

Future research This study shows the need for a more substantive piece of rigorous research. A multi-sectoral research programme should be implemented to identify the adoption and implementation processes as well as the tangible and intangible results of BI mechanisms. The proposed study would

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enhance the available literature because of the bounded area or research population, i.e. Northern Ireland and as a reference work for those interested in adoption and implementation issues. An appropriate methodology is the case history where the subject is ``bounded'' or an entity in itself (Burns, 2000) and where it examines contemporary phenomena in its ``real life'' context (Yin, 1981).

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Gummesson, E. (1991), Qualitative Methods in Management Research: Case Study Research, Participant Observation, Action Research/Action Science, and Other ``Qualitative Methods'' Used in Academic Research and Management Consultancy, Sage Publications, Thousand Oaks, CA. Hamel, J., Dufour, S. and Fortin, D. (1991), Case Study Methods, Sage Publications, Beverley Hills, LA, CA. Handy, C.B. (1987), The Age of Unreason, Hutchinson Business Press, London. Hope Hailey, V. (1997), ``Does strategic HRM require a strategic HR function?'', paper submitted to the Academy of Management Conference, Boston, MA, August. Investors in People (1995/1996), Investors in People Review, The Hambledon Group Evaluation Series, Report No. 1. Investors in People (1996), IIP UK Practitioner Handbook, 1996-1997, Investors in People, London. Investors in People (1997), IIP UK Practitioner Handbook, 1997-1998, Investors in People, London. Investors in People (2000), The Investors in People Standard, available at: www.iipuk.co.uk Investors in People (UK) and Scottish Enterprise (1997), Building a Better Business, Investors in People (UK) and Scottish Enterprise. Jackson, K. (1995), ``Long journey to recognition'', Training Tomorrow, Vol. 9, Part 5, pp. 18-19. Lee, R. (1996), ``The `pay-forward' view of training'', People Management, February, pp. 30-2. Leesem, R. (1992), Total Quality Learning, Blackwell, London. Marshall, C. and Rossman, G.B. (1989), Designing Qualitative Research, Sage Publications, Thousand Oaks, CA. Maynard, R. (1995), ``Investors in People: quality through people'', Quality World, pp. 697-702. Merckx, S. and Bumstead, D. (1990), ``Culture change through individual development: a story of the life business workshop'', in Pedler, M., Burgoyne, J., Boydell, J. and Welshman, G. (Eds), Self-Development in Organizations, McGraw-Hill, London. Parsons, D. (1995/1996), ``Heart of the matter'', Training Tomorrow, Vol. 9, Part 9, pp. 15-16. Peppard, J. (1995), Broadening Visions of BPR: The Imperatives of Strategic Integration, Cranfield SWP, November. Reed, R. and de Fillippi, R.J. (1990), ``Causal ambiguity, barriers to imitation, and sustainable competitive advantage'', Academy of Management Review, Vol. 15 No. 1, pp. 88-102. Rees, C. (1996), ``Employee perceptions of quality management strategies: some case study evidence'', paper presented at the Kingston Business School Research Seminar, Kingston Business School, Kingston upon Thames, November. Rigby, R. (1998), ``An audience with C.K. Prahalad'', Management Today, January, pp. 58-9. Schneider, B., Brief, A.P. and Guzzo, R.A. (1996), Creating a Climate and Culture for Sustainable Organizational Change, Vol. 24, pp. 7-19. Sekaran, U. (2000), Research Methods for Business, 3rd ed., Wiley Publications, New York, NY. Shipman, M. (1981), The Limitations of Social Research, 4th ed., Longman, Harlow.

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Spencer, B. (1994), ``Models of organisation and total quality management: a comparison and critical evaluation'', Academy of Management Review, Vol. 19 No. 3, pp. 446-71. Taylor, F.W. (1947), The Principles of Scientific Management, Harper, New York, NY. Taylor, P. and Thackwray, B. (1996), Investors in People Explained, 2nd ed., Kogan Page, London. Thomson, A., Storey, J., Mabey, C., Gray, C., Farmer, E. and Thomson, R. (1997), A Portrait of Management Development, The Institute of Management, London. Wilkinson, A. and Willmott, H. (1994), Making Quality Critical ± New Perspectives on Organisational Change, Routledge, London. Winterton, J. and Winterton, R. (1999), Developing Managerial Competence, Routledge, London. Yin, R.K. (1981), ``The case study crisis: some answers'', Administrative Science Quarterly, Vol. 26, pp. 58-65. Yin, R.K. (1984), Case Study Research: Design and Methods, Sage Publications, Thousand Oaks, CA.

Yin, R.K. (1998), Case Study Research: Design and Methods, 2nd ed., Sage Publications, Newbury Park, CA. Zuboff, S. (1988), In the Age of the Smart Machine, Heinemann, London.

Further reading Alberga, T. (1997), ``Time for a check-up'', People Management, February, pp. 30-2. Dale, B.G. (1999), Managing Quality, 3rd ed., Blackwell Business Press, Oxford. EFQM (1998), Self-Assessment and the European Quality Award Model, EFQM, Brussels. Subramanian, A. and Nilakanta, S. (1996), ``Organizational innovativeness: exploring the relationship between organizational determinants of innovation, types of innovations, and measures of organizational performance'', Omega, International Journal of Management Science, Vol. 24 No. 6, pp. 631-47.

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