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Index of articles on employee participation

Ownership Culture Report: Participation

OA consulting support for employee participation

Briefing Paper 3 on ESOP Committee Design Parameters


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ESOP Committee Development:
Stage 1 "Infancy"

This is part three of a seven-part article.

Published in the ESOP Committee Guide, Oakland: The National Center for Employee Ownership, 2000
by Stephen Clifford, Loren Rodgers and Christopher Mackin,
Ownership Associates, Inc., Cambridge, MA.
ISBN 0-926902-64-4
The full text is available in PDF format and as a multipart webpage.

Contents of this article:


Group Dynamics

Stage 1: "Infancy"

Stage 2: "Adolescence"

Stage 3: "Adult"

Stage 4: "Older Adult"


The initial stage of group development is Stage 1, infancy or the "forming" stage. In this stage the group often demonstrates an external "locus of control." The committee seldom initiates action on its own, but relies on outsiders to recommend action. Further, the "focus of concern" is primarily internal. The team members are more concerned about their personal reasons for membership on the committee and its reasons for existence. Members tend to be polite to each other, seek similarities and establish safe patterns of interaction.i They also need to develop confidence in each other so they are willing to give up some of their independence and "overcome their natural reluctance to trust their fate to others."ii

The forming stage in Tuckman's model also describes a group that is seeking a common reason for being together. "They typically wonder 'How do I fit here?' 'What's expected of me?' They may think that if they speak out they're misbehaving, so they don't express their feelings - they don't rock the boat. They look to the facilitator for guidance and assistance."iii

ESOP Committees are often created when managers recognize that they alone cannot fully meet the challenge of building an effective ownership culture. To enjoy the benefits of effective employee ownership, the company - and its management team - needs to better understand the workforce and its perceived relationship with the company. Thus a committee is formed to help management better understand how employees feel about the company and ownership. It needs to be acknowledged that this purpose is both advisory and activist. In stage 1, the committee will inevitably struggle with its specific mission, and the extent to which it is responsible to be an "activist" organization advocating the employees' concerns and interests to management.

Often, the first responsibility of the committee is to help plan an announcement or training program that will introduce employees to the ESOP. This common first task is indicative of stage 1 committee development. The primary influence on committee behavior is manager who wants to devise a presentation internally or hire outside professionals to plan and/or deliver the program.

In stage 1, since the committee's "locus of control" is external the manager who seeks their advice on how to make the program more effective is, in fact, running the committee. Committee members, unsure of their responsibilities and influence tentatively respond to questions and keep many of their personal opinions to themselves.

The personal insecurity of committee members can be exacerbated when they have been appointed or selected by management to serve on the committee. They may fear that they will be removed from it if they express strong opinions that conflict with the manager(s) who created the committee and selected them to serve on it. Thus, while group members may respond to the questions about the program presented, their primary concern is internal: "How am I supposed to act and react?" without jeopardizing my personal position on the committee.

Further, in stage 1, group members are learning to relate to one another in a new context. For many non-managerial employees, the committee setting is new and uncomfortable. While many of the committee members may be acquainted with each other, they do not know what to expect from each other in this new context. Stage 1 is where the group members discover their common purpose and concerns. Members begin to identify themselves as a group and start to work out the internal power structure and subgroup identities as members find allies with common concerns and interests.


Excessive intervention

In the infancy stage, since the group's focus is internal, it is likely that "productivity," as measured externally, will be low. Often, in order to encourage a common sense of accomplishment, the manager or group that created the committee will make recommendations and suggestions. These suggestions often lead to short-term achievements, which can build a sense of pride and accomplishment in the group. However, while the motivation is good, and the results may be positive in the short term, such recommendations and suggestions can be counterproductive with regard to the team.

The ESOP committee needs to get through stage 1 and grow on its own. Intervention from outsiders can short-change the group development process, and contribute to a sense of dependence in the group.iv In the long term, dependence on an outsider is likely to dampen committee motivation, and limit the sense of individual responsibility for the committee's success. Such dependency undermines the group process and prevents the committee from getting started.

The group needs to work out its own relationships. A good facilitator must maintain group rules and let the group members work out inter-personal issues and find their new roles within the group.

Unclear goals

In stage 1, committee members seek common goals. Members often seek the reason they are together. When the goals and mission of the group are unclear, it is likely to founder. It is often helpful for the creator of the ESOP committee to clarify the long-term mission of the committee and how it fits into the company's long-term goals. Once the mission is clear, the group can begin to create its own short-term goals. In the process, the group will find common goals and have external topics to discuss productively while they work out their interpersonal issues and roles. Often, it is extremely productive for a stage 1 committee to clarify concrete short-term goals based on the overall mission.v Such goals can be a highly productive way to encourage the group to "come together" behind useful goals and can be a catalyst to development through stage 1, as well as establish a framework for future work together. Jon Katzenback explains the power of this function clearly: "Transforming broad directives into specific and measurable performance goals is the surest first step for a team trying to shape a purpose meaningful to its members."vi

Unclear membership selection process

Stage 1 is when ESOP committee members struggle to define the group and themselves within it. Insecurity abounds when the committee members do not understand how or why they were selected for it. It is exacerbated when it is unclear how or why they can be removed or replaced. If members don't know what brought them to the committee, they also don't know what can lead to their removal. ESOP committee membership is often perceived as a privilege and implies authority and trust. Nobody wants to have that privilege revoked, but without a transparent selection process, members are likely to feel insecure and fail to invest their full energy and commitment into the committee.

Unclear rules

Since Stage 1 is the first step, and the members are defining themselves within the group, it is critical that the ground rules be clear and carefully maintained (preferably by a competent facilitator). If the ground rules are not clear to all of the committee members, it is likely that trust will be undermined, and fear will grow. Such fear inhibits members from fully participating in the committee which causes two negative outcomes: first, the group loses the valuable insight and energy of one or more of its members; second, since some members do not participate fully in the process, they do not feel personally responsible for the outcome which will undermine the implementation of any project undertaken by the committee.


Plan appropriate preparation or training.

Often, stage 1 can be shortened through well-planned group activities, training and meetings. These meetings need to include the chance for members to get to know each other informally and share concrete information about how they are expected to work together. Familiarity among members is extremely useful in fostering rapid growth of cooperative attitudes and efforts.vii Often ESOP Committee training provides the opportunity to "break the ice" and allows members to learn about each other in a new context. Further, it is an opportunity to give the group some of the tools that will help it in future stages. Examples of effective training include: effective communication methods, ground rules for committee meetings, problem solving and decision making processes, tools to generate ideas, evaluate ideas, seek root causes of problems and generate possible solutions.

i Weber, R.C. The Group: A cycle from birth to death, NTL Reading Book for Human Relations Training, 7th ed. Lawrence Porter and Bernard Mohr. Alexandria, VA p68-71
ii Katzenbach, J.R. and Smith, D.K. The Discipline of teams, Harvard Business Review, March-April, 1993 p111.
iii Jessup, Harlan R. The road to results for teams. Training and Development Sept, 1992. v46 n9 p65.
iv Taraschi, Rosaria. Cutting the ties that bind. Training and Development Nov. 1998, v52 i11 p12.
v Katzenbach, J.R. and Smith, D.K. The Discipline of teams, Harvard Business Review, March-April, 1993 p111.
vi Katzenbach, J.R. and Smith, D.K. The Discipline of teams, Harvard Business Review, March-April, 1993 p111.
vii Guzzo, R.A. and Dickson, M.W. Teams in organizations recent research on performance and effectiveness. Annual Review of Psychology, Annual 1996 v47 p307.

ESOP Committees: Stage 2

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