Introduction

Early Spanish settlers fancied the name "Los Balcones" (the balconies) for the place where the rugged western hill country met the eastern plains of central Texas. Elevated above the plains, the hills overlooked a sparsely populated frontier. Today, the view is very different. With a population measured in hundreds of thousands, the los balcones of Austin, Texas, have been transformed from an undeveloped countryside into an urban cityscape. Nevertheless, this region still represents a frontier. A frontier not in the sense of an expanse of wilderness; but instead, a scientific and technological terra incognita which is developing sophisticated devices and advancing the forefront of knowledge.

In the los balcones region, a high tech community composed of a multitude of commercial, research, and educational facilities has grown and matured. The University of Texas at Austin's Applied Research Laboratory (ARL:UT) has stood as a prominent member of this community for the past fifty years. And over that time, ARL:UT has become a premier research and development center successfully tackling some of the Department of Defense's (DoD) and the Navy's most challenging technological problems. However, a recent challenge faced by the laboratory has not come from the need to provide research support for a military situation, but from an immediate need for ARL:UT to redefine organizational operations in order to meet the challenges of decreasing economic resources, shifting political priorities, and changing customer expectations.

This case study is a look at ARL:UT. A look at ARL:UT’s evolution and how this organization is a unique entity established within the realm of higher education; how external forces mandated change in operations and business practices; and how the Survey of Organizational Excellence was utilized by the leadership. Lastly, the case study includes recommendations and interventions on how the survey can serve as a tool for promoting continuous improvement and excellence in the organization.

The origins of ARL:UT are traced back to 1942. In that year, the National Defense Research Council (NDRC) and The University of Texas at Austin (UT) established the War Research Laboratory (WRL) on UT’s main campus to provide aerial gunnery research and development support for World War II efforts. Concurrently, C. P. Boner, a UT physics professor on leave at the NDRC’s Harvard Underwater Sound Laboratory, received funding to conduct a Naval Ordnance project back in Austin. This project lead to the creation of UT’s Defense Research Laboratory (DRL) in 1945. The DRL worked with surface-to-air guided missile systems. However, given the growing use and emerging importance of submarine warfare during W.W.II, DRL’s mission expanded to underwater acoustics research.

The efforts of both laboratories did not end with V. E. and V. J. days. Conversely, with the unfolding of the Cold War tensions and the important strategic role played by submarine deployment, the research facilities were expanded away from main campus to a federally owned track of land in Northwest Austin. The University acquired possession of the land and constructed the Off-Campus Research Center, later name the Balcones Research Center. On this site, the WRL was merged into the DRL. And in 1967, the Defense Research Laboratory was renamed Applied Research Laboratory.

Presently, ARL:UT is located on what is now called the J. J. Pickle Research Campus named for the Honorable J. J. Pickle, past Congressman and longtime friend to The University of Texas. The laboratory has an approximate annual budget of $40 million with the majority of the funds coming from Navy sponsored projects. However, broader sponsorship from non-Navy sources has increased dramatically over the past five years. Computer modeling and satellite research are playing a growing role in the laboratory. ARL:UT employs over 500 professional and administrative staff.

In describing the original mission of the laboratory, the founding director, C. P. Boner stated, "To serve the Navy Department in the solution of problems and to work out the most effective combination of research and development for the Navy Department and [to provide] the practical training of graduate students." Boner knew the lab would benefit from the involvement of University faculty and student members, and that those members would benefit through the lab’s ability to supplement incomes, create scholarly opportunities, and provide research facilities. Moreover, Boner felt as though DRL should not be a component of an academic school, but an autonomous department within UT. As an autonomous department, the lab would be able to tap from many academic disciplines to produce creative and substantive solutions to the Navy’s problems.

From UT’s perspective, ARL:UT is fulfilling an important role for The University. This is illustrated in the following quotes. Dr. William S. Livingston, UT Senior Vice President said, "Graduate education and research are inseparable. And to the extent that a research lab is part of The University, as this one [ARL:UT] is, it must assume a share, and a major share, in education graduate students." The University of Texas System’s Chancellor, Dr. William H. Cunningham stated,

A major university’s function, purpose, and mission are summarized as a triad - service to the public, teaching of students, and research to advance human knowledge. Ideally, all organizations within the university setting complement the triad in one form or another. ARL:UT complements all three and expresses these in both their mission and vision statements.

A cascading set of factors had a tremendous amount of influence on ARL:UT modes of operation. Initially, national political priorities changed due to winning the Cold War. This lead to a reallocation of economic resources from the military to expenditures supporting what has been termed the "peace dividend." As economic circumstances worsened, the military tightened its belt and began to change the way it did business and its expectations as a sponsor of research and development. These forces mandating change (political priorities, economic downturn, and changing expectations) are described below in further detail.

Political priorities

The United States involvement both in global conflicts and as a deterrent to communism lead to the establishment of university affiliated research laboratories such as ARL:UT. It began a matter of national defense to have a military that was both well equipped and technologically superior. Substantial amounts of governmental funding for military research were needed to maintain this advantage over other nations. Funding would remain a political priority during the World Wars and continue through the Cold War period. However with the demise of the Soviet and Eastern Block countries, symbolized by the fall of the Berlin Wall, the Cold War in large part ended, and the military threat to democratic nations lessened. Obviously, such a momentous event had board consequences. Commander Wagner at ARL:UT’s anniversary symposium stated, "One of the consequences of winning the Cold War of course, was the fact that the [Navy’s] budget got a lot smaller very rapidly to pay for the peace dividend." When spending money on hefty military budgets rapidly tumbled on the list of political priorities, an inescapable condition, initially thought only indigenous to the commercial sector, forced its way on to the US military. The military and those organizations associated with them, downsized. The result, the Navy decreased in size by over 50% in five years.

In the early Fall of 1996 at an off-site retreat, the management for ARL:UT decided to identify what core areas were essential and valuable to the lab’s operational mission and what functions were not. Then in November, in the director’s "State of the Laboratory" address to all staff members, he explained how the world was changing, their customers were changing, and that the lab must change also. How the lab was to change had not yet been determined, but it would be during the next year. One member of the leadership stated that the speech created, "lots of unhappiness and enormous anxiety."

The changes occurred the following summer in the form of layoffs and consolidation of areas. Functions vital when the laboratory was on the outskirts of town such as vehicle maintenance, and foodservice were affected. With the decline in acoustical work, fewer support personnel were needed to maintain equipment. An additional contributing factor was technology. With the growing use of desktop computer messaging and publishing, the need for a large documentation department was no longer warranted. In all, over 25 positions were eliminated. Employee moral was described as dismal.

Customer expectations

"We’ve run out of money in DoD and we’ve gone down a lot, so we’ve had to stop and rethink the way we were doing business." This statement by Commander Wagner introduced the three new expectations the Navy would have as a sponsor of ARL:UT. The first was a focus on reduction of life cycle cost. That is, the cost of the technology or hardware after its deployment. A total of 60% - 70% of the life cycle expense was the cost while in the field. Therefore, any way to reduce this cost created savings in the long run.

The leveraging of the commercial standards was the second expectation. Research and development investment in the commercial arena surpassed that of DoD back in 1965. The commercial sector now has a product acquisition cycle of three to four years. For major field systems, the Navy averaged 15 to 20 years from inception to implementation. Since many nations could buy commercially available technologies on the open market, the Navy’s product acquisition cycle needed to be decreased to retain a strategic competitive advantage.

The decrease in time required a change in standards. This was the third expectation change. The Navy adopted commercial standards and moved away from mil specs. An ARL:UT employee provided an example of mil spec by saying it is to - design a piece of computer hardware that was so durable, it could be dropped off the third story, drugged through a swamp, then plugged in and used. Commercial standards are not nearly that rigorous. However, the products were dependable and affordably replaced with updated versions.

ARL:UT expanded customer base brought further customer expectations. For example, customers expected rapid turn around on negotiated support contracts, competitive cost, and helpful customer service and product support. ARL:UT attempted to met these expectations, but as a department, even though it is largely autonomous, must submit to the rigors of process put forth by The University, describe by one assistant director as "the gatekeeper". Another customer expectation was cost. The lab, through its recent downsizing, moved towards making cost more competitive to commercial competitors. Lastly, excellent customer service and product support were a priority for ARL:UT. Another assistant director said that he continuously stressed to his project leaders the importance of customer support and satisfaction.

The Director of ARL:UT, Dr. Michael Pestorius had a unique understanding of the importance of the human resource assessment. As a Navy captain in command of a submarine, Pestorius knew of the critical - life or death - nature of cooperation, communication, and the precision necessary between all crew members. Understanding crews attitudes, whether positive or negative, about organizational issues were a valuable tool in decision making and ship operations. Dr. Pestorius carried this philosophy with him in his role of Director of ARL:UT.

Measurement and Evaluation Center (M.E.C.)

Upon taking on the ARL:UT post, Pestorius contracted with UT’s M.E.C. to assist in designing and implementing an employee attitude survey. The survey consisted of eight dimensions: supervisor support, rewards, work group quality, importance of benefits, job satisfaction, evaluations, management, and physical environment. Three survey iterations were conducted in 1988, 1990, and 1992 with participation levels of 77, 71 and 61 percent respectively. While the overall results were positive, the survey showed a decrease in all dimensions between the 1988 and 1990. Moreover, the 1992 survey showed additional decreased scores in the dimensions of supervisor support, work group quality, job satisfaction and evaluations. Also, the decrease in participation rate was a concern. However during this time period, these concerns were over shadowed by the change factors, referred to previously, impacting the organization.

Survey of Organizational Excellence

Not until 1996, did ARL:UT’s leadership revisit the idea of surveying employee attitudes. With the realization that traditional research moneys simply were not going to be there, the director knew that the way ARL:UT was operating still needed to change. Given this and the past amount of anxiety the laboratory already underwent over the past five years, the need to ‘take the pulse’ of the organization was a priority. Through assistance of UT’s Office of Human Resources (OHR), Dr. Pestorius was put into contact with Dr. Michael Lauderdale, a professor of UT’s School of Social Work. Dr. Lauderdale directs the Survey of Organizational Excellence. The survey provides a unique means of improving and communicating with all members of the organization. Through the collection of employee perception data, the survey provides a look at how the organization is performing, a quantitative measurement of perceptions and progress towards objectives, a benchmark for organizational comparisons, and sends a positive message to employees that their input is of value.

In September of 1996, The Survey was distributed to all ARL:UT employees. Additional questions were added to assess supervisory effectiveness, career plans and whether or not the employees were familiar with the lab’s mission. Attached to the survey was a memorandum from the director emphasizing the importance of employee participation and encouraging all to complete the survey. Assistant directors were instructed by Pestorius that this was an important project and "that of the three surveys you have completed this year, this one was the most important" [ARL:UT recently had completed a Federal government and OHR survey]. After the surveys were collected and data returned, ARL:UT’s director wanted suggestions as to what were the good ways to return the data and to act on the results so as to address the concerns raised by employees.

Several assistant directors supported the idea of using the data. Comments were made such as: "We need to know what the responses really are and then do something about them;" "Too often it [surveys] end up on the back burner because we really don’t know what to do with it;" and, "We haven’t done well on the past survey in analyzing and relaying it to the groups. We need to change that."

ARL:UT choose the following actions to report data back to employees. First, all data was available in the laboratory’s library, to any employee. This communicated to employees that the results were not being covered up, but openly available to anyone. Second, a summary newsletter of high and low scoring items was generated by the personnel staff and distributed to all employees. Again, the newsletter conveyed to the laboratory that the survey did result in findings of interest to the lab’s leadership. Third, a special assistant directors' meeting was convened to discuss what should be done with data. At this meeting it was agreed that they would bring it up in staff meetings and ask for feedback which would then be relayed to the personnel office. No feedback was reported. Fourth, a notice of the data’s availability, the summary newsletter, and opportunity for feedback were placed on the lab’s web page. Lastly, the personnel office attempted to set up a cross sectional focus group discussion regarding supervisor effectiveness facilitated by OHR staff. The focus group did not occur.

Upon further reflection of ARL:UT’s use of the Survey of Organizational Excellence, the following purposed interventions are recommended. These interventions and recommendations are based on the scores and response data from the ARL:UT survey results.

The interventions are based on the data from the first iteration of the survey and are divided into three separate categories, interventions which could occur quickly, intermediately, or in the long-term. Within each of the three categories, there are statements of the issues raised from the survey data, corresponding rationales for addressing the issues, and potential resources available for determining meaningful solutions. In attempting this undertaking, it is essential not to tackle too many objectives and address key areas first. Furthermore, an employee’s response to a single survey item does not provide the context or full meaning of the problem. Methods such as focus groups, interviews, or additional instruments may be utilized to further define the real problem. Given this additional information, a programmatic approach could be custom designed to closely fit the organization’s needs; and therefore, the intervention would more likely achieve the desire outcome. This is a summary chart of ARL:UT’s areas of strength and concern as defined by how they scored on the various items and constructs.

Quick

The first category is issues raised from the survey which could have been addressed rather quickly by ARL:UT’s leadership. A quick response to survey data communicates on the part of the leadership the willingness to take what employees expressed and act on them in a rapid and positive manner.

Issue: Understanding of benefits.

Rational: The survey data showed a low level of understanding of the current benefit packages provided to employees. In an environment where employee retention is competitive, employees fully understanding the many resources and choices available to them through their benefits packages may help reduce turnover.

Resource: OHR provides a program on benefits packages and utilization. Provide an on-site program for staff.

Issue: Awareness of student employment opportunities

Rational: ARL:UT has always benefited and provided opportunities for graduate and undergraduate students; however, the perception of other students having knowledge of these opportunities scored low.

Resource: The University’s natural science departments are an excellent source for posting announcements both conventionally and electronically to advertise the lab’s student opportunities.

Intermediate

The second category is issues raised which are complex and require additional information, greater levels of employee trust, and commitment on both the parts of leadership and employee to work towards an appropriate response.

Issue: Supervisor effectiveness

Rational: To many employees, the supervisor represents to them the organization. A poor supervisor is detrimental. Therefore, low scores in this area must be addressed. Just as the Navy relies on expertise of ARL:UT to solve underwater acoustic problems, ARL:UT should rely on those with an in-depth understanding of the relationship between supervisors and subordinates to solve a supervisor effectiveness problem.

Resource: Supervisor training and assessment programs are available through OHR, UT’s Continuing Education program, and the UT Quality Center. Furthermore, partnerships between human resource professionals in the commercial sector may be formed to assist the lab.

Issue: Employees feeling valued - cultural diversity

Rational: These areas scored lower than others. If an employee >feels alienated from the organization, the result may be a poor outlook in many different organizational areas. Conversely, the feelings of - acceptance, pride, ownership, and a sense of belonging - frame a more positive employee perspective.

Resource: A greater and perhaps more individualistic approach may be needed. Supervisor and group leader training in the areas of team building and understanding diversity may be beneficial. This coupled with new initiatives to recognize groups or individuals for their efforts will positively compliment changes in attitudes.

Long-term

The last category contains issues which and long-term and should be continuously assessed by the organization. These issues have the potential to serve in a variety of ways explained in the rational sections.

Issue: Bureaucratic processes.

Rational: The bureaucratic nature of the laboratory was a concern on the survey. Town meetings of different groups of employees will help to address both complex and simple types of bureaucratic processes which may be changed. Quickly solving simple types of bureaucratic processes cuts down on needless or redundant work and frustration. Working on solving more complex processes results in greater time and cost efficiency.

Resource: This can be done in house, by anyone who can facilitate a discussion and has a good familiarity with how things work. To address more complex process, the Ford RAPID’s program (facilitators available on campus) may serve as a resource.

Issue: Benchmarking ARL:UT’s vision statements

Rational: If the vision for ARL:UT is a guiding document to where the organization is moving and what it should be doing, then some assessment of how the organization is performing towards achieving the vision is necessary. Most concepts in the vision statement are related to constructs provide in the survey. Additional questions could be added to further clarify achievement of vision concepts.

Resource: Continued participation in the Survey serves as a method to assess the objectives listed in the vision statement. The Survey also could be utilized as a communication tool for the vision statement and a method to stress to employees that striving for improvement and excellence is important to the organization.

Issue: Participation in the survey

Rational: The participation rate of 38% is of concern. A majority of employees decided, for one reason or another, that it was not worth their time to provide their opinions about the organization. Naturally, the question arises as to "Why?"

Resource: The employees are the resource. The question of "Why

was participation low?" needs to be asked. New ways to encourage participation must be designed such as: a set of computer stations in the library to assure anonymous survey completion, assistant directors communicating to employees that it is important to take time to complete the instrument, perhaps even incentives for groups with high levels of participation, and a continued commitment from leadership to act positively on the data. Leadership acting on the data communicates loud and clear to employees that the survey process and their opinions really do matter to the organization.

As I was reading ARL:UT’s proceedings from Linking Research and Technology Symposium, held to commemorate the 50 anniversary of the laboratory, comments from the many speakers emphasized the tremendous awareness and the important role human resources plays in organizations. For example, the Honorable John H. Dalton, Secretary of the Navy, spoke about our ability to retain world military prominence, "In the end, the future of America’s national services boils down to people. We can have the most outstanding technology in the world, but unless we have capable, dedicated, committed individuals to get the job done, we’re not worth much." Finally, a comment and graphic given by MS Robert S. Coffy, Commander of the 2d Armored Division to close his presentation summarized the emphasis and true resource of the modern organization by saying, "People are 21st Century Technology."

Note: Comments and quotations were taken from interviews held with members of ARL:UT or from the ARL:UT - Linking Research and Technology Symposium Proceedings (1995).