MANAGERS EMPLOYEE RELATIONSHIP

Manager-Employee Relationship

Manager-Employee Relationship

Power is defined as the 'capacity to exert influence over others'. Employee ownership in business companies has been on the rise during the last decades. Whether a fashion trend or logical development, employee ownership is an important part of the contemporary business world. When switching to employee ownership programme (EOP) the organisation introduces a thorough change that affects its financial situation, (Schriefer 2006) productivity, culture, etc. It is, therefore, necessary to look at the levels of change to understand what makes a successful EOP.

This paper will concentrate on one level of change, namely management-employee relationships. It will investigate the possible direction in which relationships between employees and management could develop during and following an EOP. (Economist 2007) It will argue that with majority stakes of shares being owned by employees rather than outsiders, the power distance within the company's social structure is reduced.

On the other hand, reduced power distance might result in increased perceived inequality among employees and a tendency to reassess management's authority and input/rewards ratio. The misbalance in employee-management power relations could alter the organisation's health. (Carroll 2005)

One theoretical approach that could be applied to the power relationships in employee owned company is the power-process approach of Thomas. In spite of the fact that Thomas investigates technological changes in business organisations his overall analysis of change is also be extended to other areas. Moreover, financial restructuring could be categorised as technological change in a broader sense, since it alters the way the organisation uses its resources to reach a targeted outcome. (Schriefer 2006) Thomas argues that the history of the organisation is an important feature of this organisation's choice of technology.

Furthermore, he stresses the difference between the very logic of the technical and the social systems in the organisation and the way ...