Why retrenching the tea lady is bad for productivity

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Why retrenching the tea lady is bad for productivity

A case study prompted by a new book draws some good management messages about a sometimes ill-considered rush by some businesses to dispense with the past.

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A case study prompted by a new book draws some good management messages about a sometimes ill-considered rush by some businesses to dispense with the past.

In her recently-released book, The Decline of the Tea Lady, Canberra academic Jenny Stewart describes how tea ladies disappeared from the public service because they became sacrificial victims of economic rationalism. They were vulnerable because they were usually casual or part-time employees and were mostly of ‘mature age’, so it was easy to get rid of them.

Stewart argues, however, that: ‘by any reasonable measure, the tea ladies were an asset to the organisations they served. Their salaries were low, and the service they performed of some significance’ (p21). She then describes the various consequences in terms of office hygiene, employee time wasting, etc that followed their removal from organisations and argues that tea ladies provided ‘economies of scale’.

The case study which follows of a private sector organisation demonstrates that, while getting rid of the tea lady may have initially looked like an economic gain, the direct and indirect costs of doing so were probably far greater than keeping her on the payroll.

These costs, however, are much more difficult to measure than direct employment costs, so management was able to ‘justify’ their decision, at least initially.

The tea lady’s real role - a case study

In the mid-1980s, Sheila (not her real name) became the latest (and last) of a long line of tea ladies in one of the company’s largest departments, which had more than 50 employees.

She made the tea and coffee in the kitchen and pushed the tea trolley around the department each morning and afternoon, completing each journey within 30-40 minutes. For any employee that habitually had the same drink, she would grab their cup and deliver the beverage to their desk, so their work was not interrupted. She would then clean up the kitchen at the end of her ‘round’.

Sheila was an excellent cook, and on two afternoons per week she served cakes for everyone which she had prepared at home the night before. She charged a small amount to cover her costs. On other days she either supplied savoury biscuits or purchased ‘packet’ biscuits. The company reimbursed her for these.

Not just coffee and cakes

The morning and afternoon tea runs - preparation, delivery and cleaning up - occupied about two hours per day of Sheila’s time and for the rest of the day she worked as an administrative assistant. She soon became an expert at fixing photocopiers and printers and reduced the need for service calls and delays caused by these.

Sheila’s contribution to the company and to employee morale went way beyond her tea lady role, however. She took an active role in the company’s social club and was treasurer of its punters’ club. More famously she orchestrated a Christmas raffle, which year after year raised thousands of dollars for a major charity. While Sheila received recognition for her efforts, the company also benefited a lot from the favourable publicity.

Most employees had a great deal of affection for Sheila and greatly appreciated everything she did. To say that Sheila had a positive effect on employee morale would be an understatement.

The advent of economic rationalism

All the above continued happily for more than 10 years. Then the company decided to relocate its office and when it did so the trolley disappeared and she merely purchased supplies of tea and coffee and left them in the kitchens.

Sheila kept making her cakes and supplying the biscuits, but payment was made to a tin left in the kitchen. The Christmas raffle and other activities continued as before, as did the rest of her work.

Savings offset by costs

The company justified its decision on the basis that the saving of two hours per day would make Sheila more productive and ‘free her up’ to do more administrative work. However, employees quickly realised that the potential maximum saving of two hours of one employee’s time was offset by the following extra costs:

Employees now had to walk to the kitchen and back, a distance of more than 100 metres for some. Being creatures of habit, most continued to go at the traditional morning and afternoon tea times and queues in the kitchens sometimes resulted. If we very conservatively estimate that 50 employees took an average of five minutes per day longer to arrange their tea and coffee, that’s 250 minutes per day lost – more than double the saving from parking the trolley.

Being social creatures as well, however, employees were more likely to ‘bump into someone’ either in the kitchen or on the way there or back, or ‘visit’ another colleague and start up a conversation.

Sheila still had to clean the kitchen, but spent more time doing so because the extra traffic meant that it was left in much worse condition. The refrigerator in particular caused her grief, and many staff meetings featured her descriptions of examples of late 20th-century yoghurt she had found at the back of it and her constant pleas to employees to be more considerate.

The money tin for cakes had to remain on the sink for most of the day and of course it relied on the ‘honesty’ system. Sheila often discovered that her takings were short and the tin contained ‘IOU’ notes that she had to follow up.

Economic rationalism: stage 2

Sheila was less fortunate when the next ‘administrative restructure’ occurred and the company retrenched her after almost 20 years loyal service. Whatever the economic benefits of that decision, her departure resulted in the following events:

  • Printers and photocopiers broke down just as often as before, but they remained out of action for longer. Or some of the professional staff (on much higher pay rates then Sheila) would spend time fixing them.

  • Kitchen hygiene deteriorated further. Eventually, the employee with the lowest tolerance level (again, often a higher-paid person) would spend time cleaning up.

  • While tea/coffee machines were installed, they often broke down and their maintenance contract was outsourced. Some employees were heard to comment that ‘Sheila never went on strike’.

  • The installation of vending machines meant extra time away from work stations for employees, and the cakes cost up to five times more than Sheila’s. Arguably, their contents were also less ‘healthy’.

  • The previous two developments meant that, when a coffee shop opened on the ground floor of the office complex, some employees preferred to take the lift down and have their breaks ‘off-site’.

  • A few months after Sheila departed, the company decided to redesign the kitchens to create more space. With the absence of an in-house ‘kitchen expert’ to provide practical advice, the initial attempts were disastrous, with OHS and other problems having to be corrected.

The extra costs of the company’s decisions are hard to quantify, but the above evidence shows they can be substantial. On the other hand, the loss of the tea lady shows up clearly in the company’s ‘head count’ as a cost saving.

Being dedicated to doing their best, most employees probably compensated for the inconvenience and worked slightly longer hours or took work home to make sure the job got done. That isn’t recorded in a head count. But it can be argued that they probably enjoyed the work and the company less than they could have otherwise – particularly the longer-serving employees with fond memories of Sheila – and that may have become an influential issue when other job offers came up.

So what are the lessons from this case study?

Some of your employees will make a contribution to your business that goes far beyond the contents of a mere job description. Understand, reward and recognise their contributions.

When making decisions about restructuring or retrenchment, identify all the costs and other consequences of your decision, even if you can’t put a dollar figure on some of them. It may be that the side effects of a decision exceed the projected cost savings.

Economic rationalism in management is certainly capable of delivering short-term results, but must maintain those benefits over the long-term as well. Short-term cost gains will be more than wiped out if a major incident (such as an accident due to cutting corners over OHS issues) occurs later on.

Further reading

Stewart, J, The Decline of the Tea Lady, Wakefield Press, Kent Town, SA, 2004.

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