Hewlett-Packard to The Civil Rights Movement

William Hewlett and David Packard started theircomputer-manufacturing company in a one-car garage in 1939. Their brand ofmanagement became the model for Silicon Valley. “We did not want to run ahire-and-fire operation, but rather a company based on a loyal and dedicatedworkforce,” Hewlett once said. “We felt this workforce should be ableto share to some extent in the progress of the company.” The workforce didshare. HP’s “open door” policy was the real thing. Many executiveoffices didn’t even have doors.

When an employee contracted tuberculosis in the1940s, HP established a health-insurance plan for catastrophic illness — anearly unheard-of concept at the time. In 1959, the company became the first toimplement cash profit-sharing; and in 1967, HP’s German plant started flextime,another radical concept. In the mid-1990s, HP offered telecommuting on a largescale. Job satisfaction increased. Stress — and office expenses — decreased.

In order to avoid layoffs in the 1970s, the companyimposed pay cuts and other measures, including forced vacations. Such actionswere tried again in 2001, but layoffs were unavoidable. Despite setbacks, HP hasleft the workplace with a rich legacy of invention in technology, as well as inmanagement and human resources.

Over the past 80 years, the Cleveland-based weldingequipment manufacturer has initiated some of the most innovative human resourceprograms in the country. In 1923, it was among the first businesses in thenation to give employees earned paid vacations. In the following decade, itoffered several other innovative benefits, including a stock ownership plan, anemployee suggestion program, and an incentive bonus plan. During World War II,after many Lincoln workers were drafted, the company hired large numbers ofwomen and minority factory workers.

But it is the company’s fabled incentive-compensationplan that has thrust it into a class by itself as one of the most studiedorganizations in the country. For half a century, Lincoln has guaranteedlifetime employment for all of its full-time workers who have been at thecompany for at least three years. As part of the policy, the company transfersworkers to other divisions as needed, even if that means to lower-paidpositions. Lincoln can reduce hours during bad times, but employees areguaranteed a minimum of 30 hours a week.

In the early 1980s, guaranteed continuous employmentreceived a severe test, but not one employee was laid off. The company usheredin the 21st century as a multimillion-dollar global giant.

In the early 1900s, Frank and Lillian Gilbreth, who wereimmortalized in the book Cheaper by the Dozen, developed laws of human motionfrom which the principles of motion economy evolved. Their studies of efficiencyresulted in a method for analyzing fundamental movements required to perform ajob. Once the movements have been examined, the Gilbreths said, you can look forplaces to improve or lessen repetition.

These early ergonomists defined efficient, functionalmovements for laborers, which increased productivity and improved the health andsafety of workers. Ergonomists still use a table developed by the Gilbreths toidentify risk factors in the workplace.

In the early days of Workforce, readers worked forcompanies whose employees were, by and large, white men with wives and children.But 30-plus years ago, women and ethnic minorities began to enter the workplacein droves. Today, 26 percent of workers are ethnic minorities and 48 percent arewomen. Additionally, improvements in health care and the elimination ofmandatory retirement mean there are also more disabled and older workers.

These sweeping demographic changes have affected HR inthree primary ways, explains Robert Drago, professor of labor studies andwomen’s studies at Pennsylvania State University. First, thanks to federallegislation prohibiting discrimination based on age, race, gender, ordisability, there is a lot more work in terms of legal compliance.

Second, employers have had to work harder at helpingpeople get along with each other. Training on diversity awareness, sexualharassment, and generational differences is now commonplace.

Third, benefits management has become more complex. Toaccommodate a diverse workforce, companies have had to institute such things ason-site day care, policies for religious observances, domestic-partner benefits,job-sharing, paid parental leave, part-time work arrangements, andcafeteria-style benefit plans. The benefits are there not just because companiesare being nice, says Drago, but because they have to compete for good people whoare a pretty varied lot.

With the creation of the first moving assembly line in theearly 1900s, Henry Ford introduced automobiles to the middle class. The highlyinnovative industrialist went on to change the nature of employee relations andhuman resources. In 1914, he shocked the industrial world by paying his workers$5 a day — an astonishing wage at the time. In exchange, Ford expectedemployees to work regularly, clock in on time, and maintain a serious and soberprivate life.

Ford was a student of the ideas of Frederick WinslowTaylor and the principles of scientific management. He sought ways tostandardize the behavior of workers to increase efficiency and production, andwas among the first to design factories around the way people worked.

Although many of his business methods were controversialand would now be considered unacceptable, Ford’s legacy includes treatingworkers with dignity and respect. “While tending toward being a benevolentpatriarch, Henry Ford dealt with employees more as a family to engage than acommodity to acquire and fire,” says Dave Ulrich, professor of businessadministration at the University of Michigan.

The ongoing slump in the Japanese economy has taken someof the luster off that country’s once revered management techniques. However,total quality management and the business philosophy of William Edwards Deming– which helped build Japan into a superpower following World War II — havecontinued to shape the modern enterprise. Even in an era when speed matters,there’s a growing emphasis on quality.

“Deming has clearly had a profound and lasting impacton HR,” says Arnold Packer, a senior research fellow at Johns HopkinsUniversity Institute for Policy Studies. He notes that the “father” ofthe quality movement focused attention on 14 key points, including the abilityto build quality into a product in the first place, improve it constantly,provide institute training on the job, break down barriers between departments,and stress workmanship over hierarchy.

A half-century later and eight years after Deming’s death,the concept is still going strong. Within HR, it is leading to a greateremphasis on analytics, the widespread adoption of International Organization forStandardization guidelines, and in some cases, mandatory training for vendors.”As time passes, the forces that lead to change will be harder to trace toDeming or any other single cause,” Packer says. “But his impact will,nevertheless, remain profound.”

In recent years, taxes have become a central theme in howcorporations make decisions about everything from where they locate offices towhat kind of benefits they provide. “The tax system now dictates manyactivities and decisions within an organization,” says John Boudreau,professor of HR at Cornell University. “It has changed the face of thecorporation.”

One of the most obvious examples of this new corporateorder is the emergence of stock options, which are designed to align workers andshareholders, boost retention, and allow employees to share in the company’ssuccess. They’ve served as a powerful tool for recruiting and retaining talent.More than 90 percent of public companies now offer stock options, according tothe consulting firm Watson Wyatt. Other than administrative expenses, it costs acompany nothing to issue options, thanks to a loophole in the tax code.

The tax code has affected the workplace in other ways. Therapid growth of the 401(k) is a direct result of the tax code, and so is thecomplex nature of compensation packages for top executives.

In 1932, Rensis Likert revolutionized attitude measurementwith what came to be known as the Likert scale. His method asks subjects toexpress agreement or disagreement with a set of attitude statements using afive-point scale that ranges from “strongly disagree” to”strongly agree.”

Previously, attitude scales required input from a panel ofexperts to determine which statements measured the same concepts, says WilliamTrochim, professor of human services at Cornell University. Likert eliminatedthe experts, using responses from the general population to determine whichstatements hung together.

“By eliminating the experts, he streamlined themeasurement process,” Trochim says. “An industry of attitudemeasurement was spawned by the Likert scale.”

“If it’s not fun, why do it?” With this credo,Jerry Greenfield, a founder of Ben & Jerry’s ice cream, created the JoyGang, the company’s ministry of fun. That was in 1988. To honor the company’sfun edict, festivities over the years have included the celebration of nationalclash-dressing day. Fun, it became apparent to others in business, was not justa frivolous workplace cop-out. Fun came to be perceived as a competitivebusiness necessity. Southwest Airlines has proved the notion to be true. Thecompany’s fun ethic has helped deliver three decades of profits, single-digitturnover, and an expansion to 32,000 employees.

“If you’re miserable, you’re probably notproductive,” says Sherry Phelps, Southwest’s director of corporateemployment. “Our leadership is focused on making this a great place tobe.” The company figures that a fun atmosphere will result in bettercustomer service. It published a book for employees on how to entertaincustomers during a flight delay. And it has turned its mandatory safety speechesat the beginning of flights into song. A competitor complained to the FAA thatSouthwest wasn’t delivering the proper safety messages. FAA representatives flewon the airline and found that, unlike the people on many flights, Southwestpassengers actually paid attention.

If HR has a founder, it might well be John Patterson. TheDayton, Ohio, native read about a new machine called a cash register, and boughtthe company that made it. Right away, he changed the name of the firm, which wasfounded in 1884, to the National Cash Register Company. In 1893, he started whatwas likely the first training school to help salespeople sell registers.According to the Montgomery County Historical Society in Dayton, Patterson’sschool was the first to teach “educational advertising,” a method inwhich a manufacturer first explains to prospective customers why they might needa product, and subsequently explains the features of the items.

When he noticed an employee heating her lunch on a companyradiator, he started serving hot lunches for all female employees. Absenteeismplummeted. Other trend-setting benefits included company-sponsored vacations andin-house health care.

Patterson instituted one of the first employee suggestionsystems, which became the source of many of his workplace innovations. He iscredited with establishing the first personnel department in the 1890s. Beforelong, it was no more of a novelty than the cash register.

From 1927 to 1932, Harvard Business School professorGeorge Elton Mayo conducted what became known as the Hawthorne Experiments atthe Western Electric Hawthorne Works in Chicago. Mayo wanted to determine theeffects of fatigue and monotony on productivity. He took six women from theassembly line and segregated them from the rest of the factory. They werewatched by a friendly observer. A second investigation involved two womenassembling phone relays — small but very intricate mechanisms. Mayo tinkeredwith the work environment in both groups, manipulating such things as restbreaks, work hours, temperature, and lighting.

The women were told in advance about the project, and wereasked for feedback. Mayo found that no matter what change he made, productivitywent up. The researchers believed that observing people made productivityincrease, but that was wrong, says Richard Griffith, director of the industrialorganizational psychology program at Florida Tech. “Eventually it becameclear that it wasn’t observation but the fact that someone was listening tothese women that made them more productive. It changed our view of managementfrom scientific to humanistic,” Griffith says.

Mayo showed that for productivity to rise, managers had to seeworkers as something other than appendages to machinery.

For the HR community, Thurgood Marshall’s most importantlegacy was his role as the country’s most stalwart champion of affirmativeaction. The policy intended to break the patterns and effects of slavery,discrimination, and racism, and to open job opportunities to all.

“If we are ever to become a fully integrated society– one in which the color of a person’s skin will not determine theopportunities available to him or her — we must be willing to take steps toopen these doors,” Marshall said in 1978.

During the 1960s and 1970s, affirmative-action policieswere used to increase the number of minorities and women receiving governmentcontracts. With the creation of the EEOC in 1965, equal-employment departmentshad been established throughout the country. Private companies later developedaffirmative-action statements, equal-opportunity plans, and inclusive recruitingpractices that directly affected the way HR professionals conducted their work.During the 1980s and 1990s, the U.S. Supreme Court chipped away at affirmativeaction, and Marshall’s majority position on the issue eroded. During his career,he served as chief counsel for the NAACP, as solicitor general, and was thefirst black member of the U.S. Supreme Court (1967-1991).

The Depression of the 1930s put an end to the widespreadnotion that any American who really wanted to work could find a job. The growthof bread lines, mass layoffs, and widespread misery were palpable indicatorsthat anyone could experience the pain of unemployment.

Franklin D. Roosevelt’s package of legislation known asthe New Deal was established as a way to provide a social safety net for peoplewho’d lost their jobs. “The New Deal ushered in a new way of thinking aboutwhat society and employers owe working people in terms of security,” saysHR professor John Boudreau of Cornell University. But the New Deal also made therole of personnel officers vastly more challenging and complicated.

The legislation established such things as a minimum wage,maximum working hours, unemployment insurance, and Social Security. Theseprograms required employers to adjust wages and working hours, as well as trackand report much more information — to both government and workers. Therecord-keeping challenges alone were monumental.

And because workers now had access to a social-supportnetwork outside their places of employment, they became less dependent onparticular jobs. This gave employees more freedom to leave bad jobs, and causedpersonnel officers to worry more about working conditions, employee treatment,and other factors of retention.

The New Deal, with its emphasis on fairness at work,required companies to create seniority systems and grievance procedures.Personnel professionals were suddenly required to establish democratic norms togovern the workplace.

These commonplace programs were considered radical at thetime. Boudreau says that the New Deal “forever changed how Americancompanies think of work, worker participation, and employee security.”

About five years ago, the combination of an agingpopulation and a drop in the birth rate meant that companies could no longertake hiring for granted. Recruitment became a seller’s market, and companiesbegan to utilize previously unheard-of recruitment tactics.

Referral bonuses were the first line of attack. At one endof the spectrum, Doubletree Hotels gave employees $100 for referringhousekeepers. At the other, NeXT Software, Inc., offered $10,000 for anexecutive referral. Additionally, signing bonuses were dangled in front ofcandidates who promised to stick around.

Savvy HR professionals also got creative. Sybase, Inc.,rented a biplane and buzzed competitors with a banner reading “Sybase WantsYou.” Stone Container Corp. recruited foreign refugees for jobs. OldsProducts, a mustard manufacturer, searched for new hires in local churches,synagogues, and mosques.

To make their companies more attractive, many employersalso eliminated dress codes, allowed pets at work, and invited employees to settheir own hours. On-site concierge services, day care, massage, and meditationrooms were also established. Practices once discouraged — such as hiring familymembers — became acceptable.

Thanks to all these perks and promises, people beganexpecting more from their employers. But with the current recession, the days ofemployee extras may be over.

Centuries before the phrase “going postal” wascoined, there was mayhem and murder in the workplace. In the first half of the20th century, corporations hired goons to beat up and kill union organizers. Themining, longshoring, and shipping industries were rife with danger and violence.

In the second half of the century, workplace violencebegan erupting in new ways. There were a number of isolated workplace shootingsby disgruntled employees. Headlines commonly underscored the issue — a shootingin a Seattle shipyard; a repairman in Hawaii who marched into a Xerox buildingand shot seven people to death; a failing day-trader in Atlanta who opened fire,killing 9 and wounding 13.

And there were assaults on employees by customers –particularly in places like gas stations and 24-hour food marts.

In response, HR began taking a leading role in the 1990sin developing programs to protect employees in the workplace withviolence-prevention programs such as stress reduction and substance abuse.

As the 21st century was ushered in, there were hopefulsigns. Workplace homicides dipped from 1,074 in 1994 to 645 in 1999, accordingto a recent Violence in the Workplace report released by the National Institutefor Occupational Safety and Health.

By the 1920s, America had become an industrial society. Injust 60 years, the labor pool had shifted away from agriculture and towardmanufacturing, mining, public service, and clerical jobs. By 1930, 79 percent ofworkers were employed in industrial positions.

At these new large companies, foremen tended to call theshots. They commonly hired whom they liked, fired whom they didn’t, arbitrarilymeted out punishment and pay raises, and accepted bribes for special treatment.

In an effort to wrest control from the foremen and toinstitute fairness into the system, progressive companies established personneldepartments. These early HR departments worked hard to develop betterrecruitment and hiring practices. They assessed skill needs and establishedtesting in order to make hiring decisions based on more objective criteria. Theywrote job descriptions, catalogued jobs, and standardized pay scales. Theycreated grievance procedures, sensible rules of dismissal, and, in some cases,anti-discrimination policies, pension benefits, and softball leagues.

According to Nelson Lichtenstein, a history professor at the University ofCalifornia at Santa Barbara, industrialization — more than any other factor –gave rise to modern HR practices. “With such large bodies of people, companiesneeded some methodical way to manage them.”

Since the 1920s, when they were relegated to sellingbrooms or pencils on the street or newspapers in courthouses, Americans withdisabilities have made enormous gains in the workplace. Federal laws have openedendless work options, guaranteed educational opportunities, provided workplacetraining, and eliminated physical barriers. Great progress has also been made asa result of a strong grass-roots disability rights movement and, of course,medical advances. Before antibiotics were perfected, many people withdisabilities died or were institutionalized. Today they are mainstreamed intothe workplace, says Becky Ogle, an activist for the rights of the disabled inWashington, D.C.

Over the past three decades, there has been atransformation in the way society views the relationship between disabled peopleand work. These changes have ultimately resulted in the full participation ofdisabled people in integrated employment. Those with disabilities have moreoptions today than ever before. Still, there are pressing problems, Ogle says.About two-thirds of working-age adults with disabilities in America areunemployed, and those that are employed generally make less than theirnon-disabled counterparts, according to the National Institute on Disability andRehabilitation Research.

It wasn’t until the Internet emerged as a mainstream toolin the mid 1990s that organizations were able to tap into the full power of thedigital revolution. The Internet created a seamless way for companies tointeract electronically, spawning the enormous growth of e-business. That, inturn, has driven productivity gains and helped organizations cut costs.

Today, “e-HR” is fast becoming a reality. TheInternet is easing the huge administrative burden of years past by reducingpaperwork and allowing managers and employees to directly handle tasks rangingfrom benefits selection to 360-degree feedback and performance assessments. Italso has created opportunities to share knowledge and information moreeffectively through portals and other tools. And it is cutting costs withmethods such as e-procurement, call-center integration, and collaborative workteams. “The Internet is accelerating and magnifying the capabilities ofcomputers,” says John Boudreau, a professor of HR at Cornell University.

In the mid 1990s, HR departments used the Internetprimarily for research and to post company directories and handbooks. Today, HRdepartments are using it to foster learning and to present workforceinformation, and are thus becoming key strategic players in organizations.

With her swearing in as secretary of labor by PresidentFranklin Delano Roosevelt on March 4, 1933, Perkins became the first woman tohold a cabinet-level position. It was the highest-ranking job held by a woman inthe history of the U.S. government, and labor leaders were furious. Not only wasshe thought to be invading male-dominated inner sanctums, but Perkins also wasdetermined to instigate monumental changes in society.

Her agenda included feeding the hungry, giving peoplework, ending child labor, establishing a minimum wage, limiting work hours,creating unemployment insurance, establishing workers’ compensation, andoffering pensions to older Americans.

From the time of her graduation from Mount Holyoke Collegein 1902, Perkins was involved in progressive causes. Her training was in socialwork. She was a part of the commission that investigated the Triangle ShirtCompany fire, in an attempt to prevent recurrences of such sweatshop-relatedtragedies.

When Roosevelt became governor of New York, he appointedPerkins to the post of industrial commissioner. When he won the Presidency,Perkins was appointed to the cabinet job. She served as labor secretary for 12years, and was instrumental in drafting almost all of the New Deal laborlegislation.

Decades before affirmative action, and the representationof large numbers of women and people of color in the American workplace, Dr.Martin Luther King Jr. was speaking passionately for the rights of poor,disadvantaged, and racially oppressed people. Segregation was rampant in bothschools and the workplace. King’s eloquent message served as the foundation of amovement for civil rights that redirected the course of history.

In 1952, the U.S. Supreme Court declared schoolsegregation unconstitutional; in 1955, Rosa Parks defied an ordinance requiringsegregated seating on city buses, an event that triggered a successful yearlongbus boycott — led by King — in Montgomery, Alabama. Parks’s refusal tosurrender her seat to a white male passenger prompted a tidal wave of protests,bloody attacks, and student sit-ins in the late 1950s and 1960s thatreverberated throughout the country.

In 1957, a mob of 1,000 townspeople in Little Rock,Arkansas, tried to prevent black students from remaining at a recentlyintegrated school. President Dwight Eisenhower sent in paratroopers and 10,000National Guardsmen. In 1961, busloads of freedom riders were brutalized whenthey waged a campaign to try to end the segregation of bus terminals. King, aBaptist minister, once declared, “I refuse to accept the view that mankindis so tragically bound to the starless midnight of racism and war that thebright daybreak of peace and brotherhood can never become a reality.”

As King took to the pulpit and to the streets, anothercatalyst for racial justice, Thurgood Marshall, was introducing sweeping changesin the courtroom. The two played major roles in the campaign for affirmativeaction and for the Civil Rights Act of 1964. The legislation bars discriminationin employment on the basis of race, color, religion, sex, or national origin.Many significant changes in the basic rules of the workplace in the 20th centuryresulted from the grass-roots movement.

Workforce, January 2002, pp. 39-48 — Subscribe Now!