Problem: Management Team Decision

Peer Review for Confl ict Resolution Your troubles began when the teenage clerk at one of your convenience stores wrestled a gun away from a would-be robber. On hearing the story, your friends said, "How brave!" and "Did you give him an award?" but you and the other managers in the company all had a very different reaction. You know you will have to fi re the employee for violating a long-standing and well-known company policy against heroism. Convenience store robberies are a common occurrence, and if your (mostly young) workers, manning dozens of stores, begin to attempt behind-the-counter vigilantism, you will have a serious problem on your hands. Despite the unanimous mind-set of your management team, you realize that fi ring the employee outright may create negative fallout among the other employees. At least one employee in particular is likely to vocally protest the fi ring. As you sit with your team trying to decide how to resolve this issue, one of your managers proposes implementing a peer review process at the company. A panel of employees would be responsible for arbitrating disputes and resolving any disagreements between how managers enforce the rules and how employees experience those rules being enforced. Advocates trumpet the benefits of peer review systems. Peer reviews are practical and cost-effective, particularly compared with formal legal arbitration, and they allow disputes to be resolved internally. Because peer reviews give employees some say in the outcome of disputes, the employees are more likely to find the decisions credible and acceptable.

Many managers also like peer reviews because they help to avert the backlash that a manager may experience for unilaterally disciplining an employee who has violated company rules. Detractors, however, say that peer reviews may give employees too much control over the management decision process. Review panels effectively diffuse the decision-making function throughout the organization in a way that is counter to the centralized decision making of traditionally structured companies. In addition, creating and maintaining peer review systems requires a commitment of time and resources. Employees lose work hours (and thus productivity) when they participate on panels. And management should consult with a knowledgeable attorney to make sure that review panel procedures conform to National Labor Relations Board (NLRB) dictates about work teams. The process must be shared with all employees, who also must be trained in the process. And what will you do if employees reverse a management decision? Nonetheless, the number of companies using peer review systems is increasing as their popularity grows. One consultant alone has over 500 companies, including Kodak, Hooters, Marriott, and Red Lobster, using his peer review process. For this exercise, assemble a team of five students to act as the management team for the convenience store chain in this scenario.

Questions

1. Which historical management theory gives the best justification for implementing peer review systems? Which theory would not support peer reviews?

2. Do you implement a peer review process in the convenience store scenario? Explain your decision.

3. Regardless of your answer in question 2, as a team draw up guidelines for a peer review process. What would you need to consider if you were to create a review panel? For example, do you need to set restrictions on the ratio of employees to managers on the panel-will there even be managers on the panel? How many years of service should an employee have to participate? Should the panel include a mix of employees from different departments?

4. Now, following the guidelines you established in question 3, imagine that your team is the review panel for the convenience store clerk who foiled a robbery. Discuss the situation and come to a decision regarding the outcome. Do you fi re the employee, warn the employee, or commend his actions?