Harsh Words for American Labour Relations
A speech presented by William Brock III, the former U.S. Secretary of Labor (1985-87), contains some interesting things about labour relations in the United States. What he said is also relevant to the Canadian scene. In his speech, The Importance of Labor-Management Cooperation, Brock wasted no time in castigating his countrymen for being ill-prepared for the vast changes now underway. He concentrated on the requirements for the workplace, especially the need for a superb education as well as greatly improved labour-management relations.
Brock is not reluctant to learn from the Japanese. He relates the story of the General Motors plant in California that became a joint undertaldng between G.M. and Toyota. Previously, labour relations at the plant had been worse than awful. Brock describes it as a combination of one of the most radical unions in the United States and one of the dumbest managements, resulting in the plant going broke.
Then Toyota and G.M. reached an agreement that they would operate the plant together. Toyota took over responsibility for the management of the plant, with the understanding that the same UAW members would be hired to work in the re-organized plant. Well, the difference was nothing short of astounding. Absenteeism rates of 20 per cent decreased to two per cent under the new management. All executive perks were abolished and so were 95 per cent of the job classifications.
The work is now divided into five categories. Employees are taking pride in their work, and there is respect between management and the workers. As a result, the mood in the plant has changed dramatically. Now employees take a keen interest in their work; instead of filing hundreds of grievances, they protest poor quality steel coming in. They want to make the best possible product.
Learning from the Japanese
Brock raises the question of why the Japanese are so much better at managing people than Americans. He explains:
One thing that distinguishes Japanese from U.S. management is their attitude toward labor. American managers come out of a tradition of maintaining an adversarial relationship with labor, but in Japan the relationship is characterized by cooperation. So the Japanese have had good experiences working with organizations that represent workers.
Then, when they think about putting several hundred million dollars worth of investment in the United States, they think: "We don't know the United States very well, so we had better do everything right."
Consequently, the Japanese carefully study the best approaches to labour management relationships. In the process, they learn from people like Frederick Demming who was a pioneer in establishing cooperative and trustful labour management relations~a pioneer who has mostly been forgotten in his homeland, the United States, but whose advice has been heeded in Japan.
During his stint as Secretary of Labor, Brock was also involved in attempting to settle the dispute between the management of Eastern Airlines and its unions. He worked very hard but failed because he could not overcome the absolute hatred of the two parties. In the end, Eastern Airlines was effectively wrecked, causing a great deal of hardship for the employees.
Brock concludes that the crucial thing is to treat people with respect, trust, and a keen sense of mutual dependency. One need not embrace the Japanese approach holus-bolus to be convinced that nurturing cooperation and trust in the workplace is the right thing to do.