Strategic Management of Human Resources Essay

But changes in the business environment make things difficult to sustain. 2. Question 1: To what extent are the existing practices in the management of people linked o the strategic needs of the business in relation to the changing business environment? Identify where the links might be and how they could be improved. The existing practices of the company are analyses and according to a few points of the Seven Practices of Successful Organizations” from Jeffrey Prefer some recommendations are given.

As starting point, the author takes the main strategic needs, in a changing business environment of the company and links them to the existing practices of the company and how they can be improved. A strategy is very important to run a business successful, because a good strategy will result in superior economic performance and will lead to an effective value chain within the company (Magenta, 201 2, p. 95-96). Practices in the management of people do not always fit to strategic needs of a company so that there have to be found solutions. 2. Strategic Need: Time In a high competitive market, one of the most important things for a company is to deal with the time. Referring to Watson a main problem of the changing business environment are shorter order times of their customers, which are mainly car manufacturers. The key for a good time-management is the oracle of the company and these people have to be organized within your business. The main problem here is that the ability to process orders sickly is hindered by a lack Of flexibility”, Scott is mentioning in the case study.

The workers on the shop floor are not moving between the press machines, finishing machines and assembly machines, what leads because of different demands of each machines, to some workers who are under-worked and to some who are over-worked. Especially the ones who are over-worked are not as effective as they could be under other working conditions and these people could also be an indicator for the absence of 9 per cent across the company. Another point to mention is, that the managers make the most decisions on their own, not involving many staff.

But the people on the shop floor have clear ideas how things could be improved. This important fact from the actual performance is very important for the strategic need of profit as well. To stay more competitive on the market, Watson has to improve their workfare on one hand by using their working power smarter and more effective and on the other hand by involving them more into the company, to anode the shorter getting order times. As a solution to use the power of their workers better, Watson could acquaint their workers better with the other types of machines.

Either by explanations by the other workers or by advanced trainings. Extensive Training is for Prefer one of the main points in the human resources management. Training is a essential component of high-performance work systems” (Prefer, 1998). If every worker on the shop floor is familiar with every machine, there can be developed schedules for a better arraignment of the whole working power. By involving the staff more onto decisions, a manager could find more easy a way to solve time during the manufacturing process and be able to produce more parts and be more flexible with shorter getting order times.

This could be achieved by placing a letterbox somewhere in the company and every worker is allowed to throw in letter with an idea to improve something in the organization. Suggestions which are really helpful for the company’s performance get a little price like a day off. 2. 2 Strategic Need: Quality Because of the big competition on today’s markets, the quality of your manufactured products plays a major role in squiring or keeping customers. ЂћManaging quality is crucial for small businesses. Quality products help to maintain customer satisfaction and loyalty and reduce the risk and cost of replacing faulty goods. (www. Smelliness’s. Chronic. Com, 2014) It is necessary to offer a high quality product to secure the future of a producing company. In case of Watson the business environment also changes to the need of higher expected quality. The company has some good starting points, for example they are spending a lot of money to departmental managers to train the workforce and the staff is regulars sent away to train courses. But these invested money into the employees does not bring the expected benefit, because there is a rapid turnover of key technical and managerial staff at Watson. Rumoring staff is often poached by other company’s offering better terms and conditions. It is not possible for the company competing for them or to retain equal personnel, because they do not have the budget to pay the high amount of salary their competitors do. Because Watson does not have a specialized Human Resources Manager, every departmental manager is kind of responsible for their staff and the management of their people. This oversee on one hand the risk that the departmental manager has to deal with more work and on the other hand that the workforce is not treated well enough because of the lack of know-how and time of the manager.

According to Prefer the practice to improve this last point is Selective Hiring”. Organizations serious about obtaining profits through people will expend the effort needed to ensure that they recruit the right people in the first place. ” as Prefer (1 998, p. 69) has stated. By giving more effort into recruiting employees, the company could improve their working performance and increase the quality of their products. Another point to raise the quality is, by more motivated workers. For example by giving the workforce kind of Employment Security”, another practice from Prefer for successful organizations. Ђћone of the most widely accepted propositions …. Is that innovations in work practices or other forms of worker-management cooperation or productivity improvement are not likely to be sustained over time when workers fear that by increasing productivity they will work themselves out of their jobs” Locke stated (1995). 2. 3 Strategic Need: Profit To run a business successful, the most important point for a company is to stay liquid. To achieve this goal, a company has to sell its goods to a appropriate price with enough profit margin to earn money.

If the contract prices are getting lower in the environment of a business, you have to find a way to keep your business competitive. But if all capacities are in use, you have to analyses how you could either save money or raise the contract prices. Relating to Watson there is very little done in the sector of human resources to save money in some steps of the production. The company spends a lot of money for training courses, but when the employees are well educated they leave the company to competitors. Also as already mentioned, the staff is very little involved by the managers to solve problems and get things done faster.

The ability to earn money and to have a good profit margin is maybe the most important strategic need within a business. The money a company wants to spend for Human Resources and the money the sector of Human Resources needs to squire/keep/motivate people do not fit together most of the times. 2. 4. Conclusion As it can be seen, Watson Engine Components are doing a few things right at Human Resources Management. But they are doing to many things wrong or do not even use some important practices. Today the employees of an organization are very important and should get more attention by the top management. . Question 2 In what key areas of HRS policy would you intervene in order to align people management more closely with business objectives? What are the main changes that you would make in two of these key areas, and how would you implement these changes? Two answer the second question, the author is using the Michigan model to make the key areas of HRS policy clearer and how things could be changed in he company. The Michigan model has been published in 1984 at the Michigan Business School by Charles Bombproof, Noel M. Itchy and Mary Anne Deviant.

The model is based on the cooperation of strategic management of people and the organizational strategy of the company. It identifies the need for human assets to be managed to achieve strategic goals. (http:// womb. Hereunder. Co. UK , 06. 01. 2015) There are four key areas of HRS policy according to Forums which are Selection (Hiring and Recruiting), Appraisal (Performance Management), Rewards (Compensation and Benefits), Development and Training (http:// aimlessness. Chronic. Com 06. 01. 2015). These four key areas are shortly explained below.

Selection Selection is the process Of interviewing and evaluating candidates for a specific job and selecting an individual for employment based on certain criteria. (http://BMW. Objectifications. Com , 06. 01. 2015) Appraisal The process by which a manager or consultant examines and evaluates an employees work behavior by comparing it with preset standards, documents the results of the comparison, and uses the results to provide feedback to the employee to show where improvements are needed and why. (http:// www. Objectifications. Com , 06. 01. 015) Rewards Rewards are incentives that an employee earns as a result of good performance (Bonuses, benefits). (http://www. Objectifications. Com , 06. 01. 2015) Development and Training Organized activity aimed at imparting information and/or instructions to improve the recipient’s performance or to help him or her attain a required level of knowledge or skill. (http://www. Objectifications. Com , 06. 01. 2015) Figure 1: Human Resource Cycle, Michigan model 1 984 These four key areas are linked in a human resource cycle, which can be seen in Figure 1 .

This cycle shows, that everything for the performance Of a company begins with the right selection of your workforce. After the performance, the results get evaluated and further steps in form of rewarding or development are introduced. If some people leave the company of there is a higher demand for employees, the cycle starts all over at selection. Referring to the Michigan model and the human resource cycle, selection and rewards are the most important points for Watson to change. Parts of improvements for these areas were already mentioned at Question 1 , but will now be explained in more detail. 1 Changes in Selection The quality of a good is generated during the production process. This process takes place on the shop floor, where Mastery found that the recruitment maybe is not getting the most attention. Recruiting new employees is often achieved by word to mouth”, like Mastery wrote. And selection procedures are based around an informal interview and references. It can be seen, that Watson is doing big mistakes within their recruiting progress and that they are underestimating the power of well trained and specialized workers.

Two key changes for Watson could for example be ЂћBetter selection procedures” or Search for good workers”. Better selection procedures The company should implement a clear application procedure for potential employees, that they get a better impression of the person they are maybe going to hire. The easiest way to restructure the selection procedures would be a human resources manager. Actually there is a personnel officer at junior management level dealing with the recruitment who is also doing the pay administration. So most important change for Watson should be to employ an HRS manager who is overall responsible for this sector.

Especially for the election of applicants, a person who is really skilled at HRS, could be a big win for the company and lead to a better performance. Search for good workers A second possible way to improve the recruitment could be to search for good workers on the market. This would cost the company some time and a little money for example by going to the employment agency and asking for some qualified workers. With a unemployment rate of 6,93% in 2014 (http:// desiderata. Com , 06. 01*2015) there should not be a lack of qualified and good workers in England, but Watson have to make an effort to get these people. 2. Changes in Rewards A human resource manager at Watson must also create, administer and improve a benefit structure. These bonus payments had fallen out in the sass. Outstanding pay and benefits are two critical factors that will show how well your employees feel about your organization and how much they identify with the company. Money is still the main thing what motivates people to work harder and if they are happy with their job. This non-existence of bonuses is definitely an indicator why so many people from the technical and managerial staff take better offerings from competitors.

It can also play a role for the motivation of the whole company, which can be seen with a averaged absence of 9% across the company. Re-establish bonuses One suggestion to motivate the people more, would be to re-establish a form of incentive pay. But this idea depends very on the money the company can allocate to pay bonuses. Small bonuses for very big, very time-based orders or for a special output of quality-products would probably motivate the workforce and lead to a better performance for the company. Reward attendance With an absence of about 9% across the company, Watson pays about 20 employees every day for no work.