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During the 1980’s there was considerable concern in the U.S. about lagging growth in productivity. Productivity is not merely an academic concept (i.e., outputs divided by inputs). Rather, it provides the basis for achieving organizational performance in the short- and long-terms. A high level of productivity enables an enterprise to manage for the future (via research and development, including developing new cost-effective ways to produce products or provide services); to pay high wages (due to the high economic value of employee outputs); and to consistently improve products/services (so that customers experience delight, if not just satisfaction.)
In the 1980’s, though, U.S. productivity had come to a standstill and the nation was faring poorly, especially when compared to Japan. In colloquial terms, the United States was “getting its clock cleaned” by Japan. Japanese companies had taken over the manufacturing of color televisions and portable radios (e.g., the Sony Walkman), and were beginning to gain market share in automobiles. Indeed, Japanese adoption of Total Quality Management techniques led to an article in the Harvard Business Review by David Garvin (1983) which noted that the very best United States manufacturer of air conditioners had 7 times as many defects as did the worst Japanese Manufacturer.
Not surprisingly, there emerged books on the Japanese approach to management, and two consultants from McKinsey & Company, Thomas Peters and Robert Waterman, scoured the U.S. to find highly successful companies. Surely, there had to be some. Their efforts led to In Search of Excellence, which quickly became the biggest selling nonfiction book of all time, excluding the Bible. Peters and Waterman (1982) invoked what they called the 7 S model, but they never directly measured any of the seven independent variables (e.g., strategy, structure, style, systems).
In conjunction with the effort to achieve higher productivity, researchers in the United States (including the present writer) studied various techniques for improving productivity. I authored several articles in the National Productivity Review and became a member of their editorial review board. The sets of practices I examined—separately and one-at-a-time–included the effects of objective feedback—feedback that is specific and incontrovertible—on individual productivity (Kopelman, 1982), the effects on job redesign (Kopelman, 1985). Subsequently I examined the impact of alternative work schedules (Kopelman, 1986), and then I summarized an examination of 10 productivity-related practices in Managing Productivity in Organizations (Kopelman, 1986).
A more constructive approach toward improving organizational performance emerged during the 1990s and was centered on the conduct of research on multiple High Performance Work Practices (HPWPs). The impact of any single work practice was found to have a relatively modest effect in comparison to a package of HPWPs which were classified as constituting High Performance Work Systems (HPWS) (Combs, Liu, Hall, & Ketchen, 2006).
Although there was not universal agreement as to what practices should constitute HPWPs, a meta-analysis by Becker and Gerhart (1996) identified 13 prominent practices: incentive compensation, training, employee participation, systematic employee selection, internal promotion, HR planning, compensation level, flexible work, performance appraisal, grievance procedures, teams, information sharing, and employment security. Importantly, Combs et al., (2006) found that although individual practices tended to have a modest effect on organizational performance, when practices are strategically combined into HPWS, the effects are far greater.
Most of the 13 prominent practices had been targeted to improve worker motivation and/or ability, and consequently, job performance. In contrast, a few of the practices can be seen as primarily directed toward increasing employee opportunities for personal growth, job satisfaction and loyalty. But none directly addressed the issue of customer satisfaction and loyalty.
Twelve years after I summarized the effects of productivity-related practices, I had an epiphany. As I argued in my article, “Managing for Productivity: One-Third of the Job,” (Kopelman, 1998), successful organizations must simultaneously enact practices that are productivity related (and thereby enterprise-directed), they must also enact practices that are customer – and employee-directed. Two decades of subsequent research led to the development and validation of the Cube One Framework, an approach that measures the frequency with which three sets of practices (enterprise-, customer-, and employee-directed) are enacted. In short, it has been found that successful organizations are, perforce, need satisfying places for the central parties involved: providers of funding, customers, and employees.
This two-decade research enterprise has been summarized in the text, “Improving Organizational Performance: The Cube One Framework” (Kopelman, 2020). Over time, abundant empirical evidence supporting the Cube One Framework has been accumulated, including five survey research studies conducted in four countries; longitudinal stock market valuation studies using Fortune’s Most Admired Companies, and case studies of 7 organizations – 6 being published in the journal Global Business and Organizational Excellence. The case studies examined such focal organizations as Google, AltaVista, Continental Airlines, Four Seasons, Zappos.com and Nordstrom. A case analysis of the Mayo Clinic, seen through the lens of the Cube One Framework (authored by Massimino, Joseph, and Kopelman, 2015) was published in the Journal of Organizational Effectiveness: People and Performance, 2(1), 73-90.