Goals and Objectives:
The case study aims to assess and analyze the extent of effectiveness of using Human Resource Management and Development in the case of Galactic Office Furniture and be able to clearly illustrate a plan wherein the company will be able to solve conflicts with their employees and improve human resource strategies for the company.
Practicing SHRM is not easy as everyone thinks. It requires a lot of things and can have several implications. However, the major effect of gaining knowledge about the SHRM is the learning process. Through appropriate SHRM methods, an organization can build a better workplace for employees, managers, directors, and other stakeholders. However, to achieve this, the organization and its people must work together. This paper is about to analyse if the HR plans of GOF are done correctly. It also seeks to explain the advantages and disadvantages of the current situation in the company.
As stated in the case, the company has been experiencing a lot of losses. This matter alone gives the company enough reason to spend all they can to increase profits and implement strategies concerning costs – specifically, lowering costs and increasing profits. What the company does not know is that they have been missing a lot when it comes to their human resources. Because they were very concerned about the company’s losses, they just seem not to notice the problems between the employees. Or maybe they have been noticing it but just ignoring it.
Just by reading the dialogues in the case as bases for analysing the current situation of the company’s HR strategies, we can say that it is not done effectively. Although there is really no exact strategy that is mentioned in the case (except for the 360 one” that is mentioned very briefly), we can say just by the way reading the case that there are a lot of issues that has to be resolved in the company. There are a lot of employee conflicts that need to be acted upon or else it will ruin the entire company.
Advantages of the current situation
The current HR policy of the company has its advantages. The company aims to work on new product opportunities and it will be pursued through researching the needs of the customer and encouraging the input of ideas from everyone in the company. Their plan is to recruit, train and retain the best people in the company’s business sector. This is actually an advantage for the company as well as for the employees since everyone will be given the chance to excel in their own specializations and at the same time, benefiting the company. This could actually be the solution for the company’s losses since everyone would strive really hard to get promoted. Although this could lead to competition between employees, the brighter side is that it can increase the quality of the company. Competition is not always bad because it gives room for efficiency.
Also, when the new mission statement was released, it also aims to use the company’s people to ‘improve efficiency, reduce costs, and increase flexibility to respond to change”. This is actually good thing because in saying this, employees may feel that they are valued. They can feel that they are not just merely employees but they are the key players in the company.
The mission statement also talked about clearly defined responsibilities which can eliminate organisational barriers. If followed correctly, the mission statement seemed to be perfect for all the employees because it gives them value and it makes them feel that their job is appreciated. This could result to better harmony inside the company. This could also empower the employees which will make them work hard and love their job.
The proposal of Arnold Winner also has its advantages. It can actually solve all the conflicts that are happening inside the company. Arnold proposed about using the employees’ talents instead of transforming them into something which is really not them. It could have a great impact in the company because everyone will be in their comfort zones and everyone will perform their tasks easily because they are inclined to it.
An annual appraisal scheme also exists which is a good thing because everybody gets the chance to get evaluated which creates room for improvement. There is also a secret bonus scheme for selected managers which was implemented six months ago. If their department achieves the revised targets then a bonus payment equivalent to 20% of annual salary will be payable. This is an advantage for the company because it can motivate the managers to work harder.
Disadvantages of the current situation
There are a lot of problems arising in the company. There are a lot of issues that has to be discussed. There some employees that are very bossy that is why it causes some conflict between the other employees, thus, creating an unhealthy workplace. The employees also find it hard to trust one another and be honest with each other. There are also conspiracies between employees against other employees. Some employees also listen to gossips and base their arguments on them which is not logical at all because they are just hearsays. There also issues about the office space, seniority, and gender. There are also managers who do not welcome other ideas and there are also employees who are suspicious about their managers. Another thing, if a procedure fails, some of the managers just hide it to their employees. The problem with some of the managers, like William Short, is that they only care about the business aspect of the company not thinking that human resource is still part (a very important part actually) of their business. These conflicts are certainly are of no good for the company. It creates an unhealthy environment and employees will continue to build gaps between them. If these continue to happen, the company will come down to ruins even if it applies the most effective strategies to increase their profit.
It is not unusual for the training and development implications of business decisions to be considered last or ignored totally. Often the T&D function is bypassed by line managers and training interventions are implemented and not evaluated. William Short tends to place more importance upon the work of the Employee Relations and Senior Personnel Advisers. However, the directors have started questioning the amount of money being spent on T&D and William has found himself under pressure to justify the T&D budget. He decides not to speak to Arnold but to access the website of the Chartered Institute of Personnel and Development (CIPD) to see what he can find out about the evaluation of training. He hopes that this search will give him the answers he’s looking for. Communication also between the employees are not good enough that is why the important topics need to be discussed are not properly solve because of great independent attitude and pride of some employees.
One change management workshop has been run during the last eighteen months. No board directors or senior managers attended. This shows that the employees having higher position are not good model to their subordinates. The willingness to improve are not high enough that is why the goal to have innovation can be hard to reach.
There is no officially published HR or manpower plan for the company although William Short, the Personnel Manager does hold discussions with senior managers about potential promoters and staffing levels in their departments. It is company policy to with-hold the outcomes of these discussions from middle and junior managers. William Short is the only member of the personnel department invited to attend board-level meetings and consequently the Training & Development, Employee Relations and Senior HR advisors have to feed all their plans and proposals to the board via him. Monthly personnel department meetings often focus on how the board are actually going to continually review business processes and organisation structures, with William Short usually declaring at the end, ‘don’t worry they’ve got that all worked out.’ In formation barriers can lead to the conflict between different parties if not properly handling.
To date there has been no published business plan although an annual away-day is held and certain ideas are committed to paper in the form of a company marketing strategy. Only board directors and senior managers are allowed to have a copy. Under no circumstances are they allowed to let another employee see it. Senior managers only publish specific objectives to their team.
The organization should settle the problem of ineffectiveness in communication between higher level management and lower level management that creates uncoordinated working environment. Alternative courses of action should be implemented to instigate a good working relationship among personnel. These alternatives must be done to achieve coordination and cooperation of work through clear channels of communication within the company. Also, the sense of seniority among the top level managers should be eliminated. Some of the personnel should be evaluated accordingly to know if they really are efficient and effective in doing their job.
Restructuring the organization
Scientific management starts with the premise that the task of an organization is to elicit from the worker those units of effort that best complement the other major productive inputs- machines. In a sense, man is viewed as an unfortunate necessity, unfortunate because he tends to be less predictable and less able on a standardized activity at a specified rate than a machine. On this view of human inputs, the job of a manager is to find the optimum sequence of detailed steps for the performance of a certain activity ad to provide the incentives for the worker to follow this plan. So far, all of these sound perfectly logical. But moving from these considerations, “effort” and “incentive” are defined somewhat narrowly. By effort, this theory means only the muscular, physiological variables, and as for incentives, the sole recognized commodity is economic gain- pay.
Given a specific production task to be performed, the job of the manager is to restrict the possible ways or methods that a worker could follow to a “one best way”. This means that each job, or component of a job, should be studied in detail, to determine the best method and the shortest possible time to carry it out. (Taylor)
The idea of a “social system” was introduced to describe the total organization of a group and the relationship that controlled its operation. It is useful to look at both of these words carefully. The important thing about a system is that it consists of parts, each achieving its specific objectives and maintaining a certain relationship with the other parts, so that together they adapt to the environment as they maintain their interrelatedness.
In restructuring the business enterprise, the Strategic Stakeholder Management Model would best fit the enterprise.
The Strategic Stakeholder Management Model conceived from the idea that the company have a social responsibility and that responsibility is necessary or the interests of the stakeholders, stated that HRM judgments should be familiar to stakeholder interests and also a group of situational factors. The model points out the weight of situational factors on stakeholder interests, and their impact on human resource policy choices which are made to deliver a push of predetermined human resource outputs such as commitment, capability, correspondence and cost-effectiveness (Saka).
Why the Strategic Stakeholder Management model of HRM?
Since the Galactic Office Furniture is a labor-intensive company, Strategic Stakeholder Management Model of HRM is a plausible format to follow. The first consideration is the stakeholders’ interests, wherein you must see to it that it also satisfy the impacts on human resource policies. In the long run, both the individual and the organization will be benefited by this format. It follows a rigid formatting for HRM yet it doesn’t overlook human resource policies. Because of this, the employees retain a sense of commitment, capability, yet staying to be cost-effective.
The Strategic Stakeholder Management model, show us the different relations within different employees or individual within the organization thus it serves us guide. It emphasizes more on teamwork, communications and improving of talents and skills for the advantage of the company (Poole & Mansfield, 1994).
Soft HRM mainly highlights on “human” and is in cooperation with the HR schools of Herzberg and McGregor (Storey, 1987). This is a manifestation of what we so-called Developmental Humanism, in the context of man. (Legge, 1995, p.66-67). Giving further emphasis on Human Resource policies with objectivity in business, the soft model puts the employees on the limelight. They are the valued property, someone capable of providing a competitive edge with their obligation and commitment to certain tasks, adaptability and high quality skill and performance, and character. Human Resource represents an important aspect in the success of a company: their performance also determines how well the company would do in the market. HRM is not only limited to the people, but also includes every aspect of taking care of them, their needs, their provisions and compensations for every job done. Their efforts should be properly reciprocated so that it would encourage them to maintain or improve their performance.
One way of approach is participation approach, allowing the employees to interact with one another and giving them a chance to do the things which will give the company additional gains and efficiency (Legge, 1995, pp 66-67). Thus they need to be trusted.
The soft edition is seen as a way wherein you release the untapped stores of human resourcefulness by boosting the morale of workers thus increasing also their willingness to commit, contribute and engage to the organization or to the firms.(Gill, 1999). It could be expected that along with employee commitment, it is required to have second-order effects. Walton (1985, p. 79) recommends that good performance of the company cannot be acquired if the workers or the employees have low obligation to the organization or to the firms. Thus having low employee commitment in the firms will not meet the standards of excellence set by the global competition, thus leaving them in an un-globally competitive position.
Conclusion and Recommendation
Employees are input of the firms to have output but this kind of input have different unique characteristic. They are alive capable to think and to react in every action you make to them. People are the most important input of the company. Thus they need special attention or different approach that will suit to them as human. For Galactic Office Furniture, a detailed concept of HRM for their employees would mean a lot, in terms of profitability and business stability, when you view it in the long run.
The following are suggestions/recommendations that the company could consider as a continuation of this case study:
1. The author recommends using the 360-degree feedback evaluation system.
The 360-degree feedback evaluation is not like any traditional performance appraisal systems. This kind of evaluation system tries to seek information about a person’s performance through people who have been working or had a working relationship on the person being evaluated. It also includes self-evaluation (Noe, 2005).
One advantage of this kind of evaluation procedure is that the feedbacks come from people who have been working or had a working relationship with the person being evaluated. Because of this, feedbacks are most likely to be accurate since the people around the person being assessed are the ones who really know the competency and weaknesses of that person. Another advantage is that the employee is able to compare his perception about himself and how others perceive him as an employee. Lastly, the evaluators are able to give feedbacks confidentially and anonymously to avoid conflicts among colleagues. In using this kind of appraisal system, the individual being evaluated is given more room for improvement.
The real purpose of this in utilizing this kind of performance appraisal method to GOF is for the employees to have more formal training if they found out that it is needed. It is also used for the continuous progress of the employees and eventually, the whole company.
However, in this kind of performance appraisal system, some conflicts may arise. It is necessary to apply this kind of evaluation procedure and at the same time, monitor the relationship between the employees to avoid conflicts.
2. Another solution can be the application of different external and internal recruiting strategies
When a firm wants to hire new employees, it can make use of different recruitment methods. It has the options of recruiting internally or externally. Internal recruitment is when the firm hires from inside the company or corporation. It could be hiring through promotion, reassignment, demotion, temporary promotion, and a voluntary change to lower grade. External recruitment is when the firm or business hires applicants from outside the company. The four most common ways of external recruitment are the use of job centers, job advertisements, recruitment agencies, and through personal recommendations and interviews. External recruitment could be hiring of veterans, reemployment of previous employees and hiring of totally new faces. Internal recruitment is really advantageous since applicants for the position are already familiar with the nature of work. On the other hand, external recruitment also has its advantage since new people might bring new ideas to the business (Noe, 2005).
3. Another way on how to retain employee loyalty is offering several kinds of benefits that are not heavy on the part of the company. Of course, GOF must try its best to lower its cost and at the same time, treat their employees well. They can try different compensating methods like customizing the benefits to each employee. This is actually good primarily because every employee has different needs. By customizing employee benefits, employees get better benefits that are fit for them and for their lifestyle. In this way, employees will feel satisfied about their job and will be motivated to perform well in their job. Because of this, more profits can be generated through quality service.
4. Lastly, GOF may try other compensation systems like compensating using stock options.
Stock options are a form of compensation which serves as a bonus or reward or an incentive for employees so that they would continue in the company. In short, stock options are like a way of the company in retaining its employees and personnel. A stock option is a privilege in which the person can acquire particular numbers of share of the corporation’s own stocks at an exercise price. The exercise price is the specific price of the stock per share (Blair, 2001).
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