Human Resource Management
The Boston Chocolate and Truffles Company is a London based chocolate business company as it is continues to grow it is significant to understand the importance of human resource management (HRM) and the implementation of its strategies. This paper is an informative guide that will cover the definition of Strategic Human Resource Management (SHRM), importance of HR in organisation, also the analysis framework of the SHRM. Further, the guide also includes the understanding of the formulation and implementation of HR strategies that would analyse SHRM process, assessment of the roles in SHRM and lastly, the analysis of the development and implementation of HR strategies. A. Definition of strategic human resource management
The Chartered Institute of Personnel Development or CIPD (2013) identified that SHRM is an approach of the management within the organisation that sets strategic framework that concerns business goals and outcomes including the long-term people issues such as their quality, structure, values and commitment. Subsequently, Bratton (2013) described SHRM as a process involving human HR in the organisation policies and practices in linking to the organisational strategic objectives. Armstrong (2007) affirmed that SHRM is a concept of integration of HR and the strategies of the organisation is being achieved that includes how HR to get there, the coherence and supporting the strategies HR to be developed and implemented. According to Storey (2001), SHRM is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce using an array of cultural, structural and personnel techniques.
Another approach to ‘defining’ SHRM is to treat the task as the demarcation of an academic field of enquiry and/or a general field of practical activity. This is essentially what Boxall and Purcell (2003) do when they describe how their definition ‘allows for a wide variety of management styles’ (p.3). They go on to state that ‘Human resource management (alternatively employee relations or labour management) includes the firm’s work systems and its models of employment. It embraces both individual and collective aspects of people management. It is not restricted to any one style or ideology’ (p.23). In summary, SHRM is all about the management of human resource in terms of labour and personnel in an organisation by a specified approach in order to achieve the organisation’s goals in the future.
B. An explanation of the importance of human resource management in an organisation
1. Facilitates Organization’s Growth
Human resource is important because it facilitates the organisation’s growth by producing effective employees by means of recruitment in order to attain its goals. Recruitment is a major responsibility of the human resource team. The HR managers need to come up with plans and strategies for hiring the right kind of people. They design the criteria which is best suited for a specific job description. Their other tasks related to recruitment include formulating the obligations of an employee and the scope of tasks assigned to him or her which would be the basis of the employee’s contract. HR manages the employment process from screening resumes to scheduling interviews to processing new employees. Typically, they determine the most effective methods for recruiting applicants, including assessing which applicants are best suited for the organization’s needs. An organisation’s growth is dependent on the strength of its work force and recruitment is one of the key functions of human resource. 2. Provides guidance and mentoring
Human resource provides guidance and mentoring to employees, such as one-to-one coaching which gives the necessary support to them. When needed, HR managers also provide training to the employees according to the requirements of the organisation. Thus, the staff members get the opportunity to sharpen their existing skills or develop specialised skills which in turn, will help them to take up some new roles. Through this, it will enhance the knowledge and skills of employees Armstrong (2012). Mayhew (2013) stressed that as HR develops the organisation, it identifies the capabilities and strengths of employees that could lead to leadership roles within the business.
3. Handles People’s Problem
Another importance of HR is handling the employee’s problems such as absenteeism, handling negative behaviour and under-performance. Armstrong (2012) viewed this as an important part of the transactional role of HR. Human Resource could address the employees’ negative behaviour and under-performance by encouraging them to work according to their potential and by giving them suggestions that could help them improve their work. Performance appraisals help motivate employees since these enable them to form an outline of their goals with best possible efforts. HR may tackle the problem of absenteeism by initiating incentive plans and programs such as flex-time, wellness programs, and project completion perks, these are proven to increase morale and productivity of employees.
4. Maintains Harmonious Work Atmosphere
Another significant importance of HR is the role it plays in maintaining a harmonious work atmosphere, this is a vital aspect of HR because performance is largely driven by the work atmosphere or work culture that prevails at the workplace. A good working condition is one of the benefits that the employees can expect from an efficient human resource team. A safe, clean and healthy environment can bring out the best in an employee.
5. Ensures Compliance and Manages Labour Disputes
Another important aspect of human resource is its role in ensuring lawful employment for all the personnel. HR ensures that the organisation complies with the country’s employment laws. They complete paperwork necessary for documenting that the company’s employees are eligible to work. They also monitor compliance with applicable laws for organisations that receive government contracts, through maintaining applicant flow logs, written affirmative action plans and disparate impact analyses. HR also manages some aspects of labor conflicts, it is the human resource department which acts as a consultant and mediator to sort out those issues in an effective manner. Grievances are heard from the employee’s end and HR will come up with a solution that encourages amicable settlements and alternative dispute resolutions.
6. Sustains the Business
Lastly, HR is important because it sustains the business. HR deliverables such as reasonable pay and competitive benefits; workforce diversity; a happy, healthy, and productive workforce; useful training and career development; dispute resolutions; positive community relations, and good working conditions for employees are elements of sustainability — and all are crucial to the business’s ongoing success and stability.
C. An analysis of the framework of strategic human resource management
The SHRM framework provides HR strategies to be integrated with the organisations strategies. Strategy is the approach selected to achieve defined goals in the future. Strategic human resource management determines long term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out those goals.
It is worthy to note that critics have been questioning the effectiveness of the different frameworks and strategic models, the crucial issue is whether a particular framework/model really match the HR strategy and the organisational strategy that a business or enterprise needs for its continued development and success. It is imperative that we study and analyse some of the HR frameworks.
HRM Integration and Strategic Fit
Perhaps the most significant feature of HRM is the importance attached to strategic integration, which flows from top management’s vision and leadership, and which requires the full commitment of people to it.
David Guest (1991) believes that a key policy goal for HRM is strategic integration, by which he means the ability of the organization to integrate HRM issues into strategic plans, to ensure that the various aspects of HRM cohere and to provide for line managers to incorporate an HRM perspective into their decision making.
Karen Legge (1989) considers that one of the common themes of the typical definitions of HRM is that human resource policies should be integrated with strategic business planning. Keith Sisson (1990) suggests that a feature increasingly associated with HRM is a stress on the integration of HR policies both with one another and with business planning more generally.
Strategic fit has received a lot of criticism for many years because its strategy has been systematically and intentionally designed to the business needs when developing HR strategies to achieve congruence between the HR strategies and the organization’s business strategies within the context of its external and internal environment. As pointed out by (Budwar and Aryee, 2013) strategic fit ignores employee’s interest, it is inflexible and somewhat lacks adaptability.
This framework is more inclined to be more pro-management rather than taking into consideration the employee’s welfare when it is so important that there must be a balance between the employer-employee relationship.
Best Practice Model
This approach is based on the assumption that there is a set of best HRM practices that are universal in the sense that they are best in any situation, and that adopting them will lead to superior organizational performance. A number of lists of “best practices” have been produced, the best known was produced by Pfeffer (1998) namely: Employment security; Selective hiring; Self-managed teams; High compensation contingent on performance; Training to provide a skilled and motivated workforce; Reduction of status differentials; and Sharing information
Patterson et al (1997) associated “best practice” with sophisticated selection and recruitment processes; sophisticated induction programmes; sophisticated training; coherent appraisal systems; flexibility of workforce skills; job variety on shop floor; use of formal teams; frequent and comprehensive communication to workforce; use of quality improvement teams; harmonized terms and conditions; basic pay higher than competition; and use of incentive.
“Best Practice” as a framework had been commented by many authors as over stated in the sense that if it works in an organisation will not necessary work for other strategy due to culture, management style and working practices.
Eisenhardt and associates (2000) argued that whilst such routines and “elements of best practice” that constitute dynamic capability, work effectively during times of stability, they break down under more turbulent conditions and experiment replaces routine
Eugene Bardach (2011) claims that the work necessary to deem and practice the “best” is rarely done. Most of the time, one will find “good” practices or “smart” practices that offer insight into solutions that may or may not work for a given situation. Scott Ambler (2011) challenges the assumptions that there can be a recommended practice that is best in all cases. Instead, he offers an alternative view, “contextual practice,” in which the notion of what is “best” will vary with the context.
It appears that the “best practice” model may be beneficial to HRM but it also has certain flaws, before adopting this framework, it is necessary for HR managers is to identify what are most likely the organisation’s needs and the practice that can be used to address such needs. Best practice often fails to take into consideration the organisational context and specific needs of an organisation. As a strategy, best practice could more often than not become too rigid and inflexible to cater to employee’s needs, resulting in unrest.
Best Fit Model
The best fit model has three different models (life cycle, Competitive Strategies and strategic configuration). To give focus on the life cycle that demonstrate the development of the organisation in starting-up, growth, maturity, and decline Armstrong (2011) suggest that HRM needs to use its full potential, to realize its full potential, it must fit to the organisation stages of development, he added that as it continues to grow the more it becomes complicated.
The main thrust of the argument for the “best fit model” is that HR strategy becomes more efficient when it is linked or tailored to its surrounding context or environment of the business. Thus, strategic management and organizational effectiveness follows from achieving the best fit between an organization and its external environment.
Strategic HRM has borrowed the central concepts of environmental analysis, organization–environment fit, competitive advantage, strategy formulation and implementation, as well as physical, organizational, and human resources. This strategy involves stakeholders as it considers different aspects that could influence the effectiveness of the organization. This is what is meant of strategic configuration, wherein HRM policies and practices should fit or match the organization’s internal environment specifically its workforce, business strategies, management philosophies and interaction styles and external environment such as labor market conditions, unions, task technology, laws and social values.
Broadly speaking, I am more inclined to agree with Armstrong’s conclusion that among the SHRM frameworks, the best fit model is more realistic compared to other frameworks because it is more capable of addressing the different needs and aspects that influence organisational strategies. It offers highly customized and flexible solutions that are designed by balancing business and HR goals, and the company culture and processes. These solutions enable the organisation to gain a competitive advantage by meeting the company’s specific needs which leads to enhanced business results.
D. Analyse the strategic human resource process
Part I: Recognise Organisational Design
The first part of the human resource process is recognising the organisational design and this determines how the organisation should be structured and the different organisational functions. The organisational design should serve as a link between human resources management and the overall strategic plan of an organization. Specifically, Armstrong (2007) investigated that the management combines different integration of organisational operation whether there is precariousness in the external environment. This shows that HR managers should be involved in creating the organisational design which makes them vital in human resource planning. Reilly (2003) stated that it process in which an organization attempts to estimate the demand for labour and evaluate the size, nature and sources of supply which will be required to meet the demand. Hence, HR has the full understanding of the whole organisation’s behaviour, its specific needs and the best possible course of action for proper implementation of such strategies.
Moreover, the organisational structure determines the roles and responsibility of the people working within the organisation. It also specifies the powerline authority and communication. This structure can be identified as centralised or decentralised.
Part II: Development and Implementation
The second part is the development and implementation of HR strategies, it is the responsibility of the line managers to implement and enact the policies within organisation. They ensure that the policies are put into practice, hitting the organisation’s targets and goals as they are expected to be done. HR must initially identify the infrastructure and system requirements to support full implementation; it must develop the competency profiles; implement the competency profiles in a staged-way to demonstrate benefits; and lastly report the success stories as competency profiles are implemented. When needed, HR must develop, revise and update competency profiles to meet changing demands of the organisation and its personnel. It must also monitor and evaluate applications to ensure that they are meeting organizational needs, and adjust programs and plans to meet evolving needs. Proper training for development could serve as guide for better execution of HR strategies.
E. Assess the roles in strategic human resource management
Armstrong (2012) identifies the various strategic roles of HR professional. He viewed these roles as an essential part of business strategies as they are involved in the implementation and development that is structured with one another. HR professionals. Managers also shape the lives of HR professionals as they strive to become “strategic partners”. For HR professionals, the work of construing their modern social identity can be exciting as well as stressful (Glover & Butler, 2012). Looking ahead, we anticipate increased interest in understanding the dynamics of effective strategic partnerships between HR professionals and managers, for the promise of strategic HRM systems is more likely to be realized when this partnership thrives.
The interdependence that characterizes elements of an HRM system extends to the organizational players who enact the system through their daily work. HRM systems come alive in social interactions among organizational members, including those involved in formulating, communicating, and responding to elements of the HRM system. This set of players—HR professionals, line managers, and target employees—is sometimes referred to as the “HR Triad” (Jackson & Schuler, 2003). HR professionals have become more actively involved in the business planning process; formal policies have become more subject to interpretation by individual managers as they strive to respond to specific and rapidly changing situations.
One of the most important role is board of director they ensure that the organisation will meet its goals and mission that is operated competently to the best interest of its stakeholder’s council (2013), in general their responsibility includes strategic planning, finances, organisational operation and human resources therefore the board must have expertise in all aspects to provide hands on management of HR.
In assessing the roles in strategic human resource management, it is significant to note that the concepts of partnership and interdependence play in the success of the organisational operation for HR professionals. There must be high levels of interactions and coordination for HR professionals and the different departments of the organisation.
F. Analyse the development and implementation of human resource strategies. Who are involved, how are they involved, and extent of involvement
In the analysing the development and implementation of human resource strategies, we must first take into consideration the organization as a whole and decide who involved, how are they involved and the extent of their involvement. The persons involved are board and senior managers; line managers; and human resource. Primarily, the role of the board and senior managers is to approve and agree as to the strategic plan of the HR. There may take disagreement in some ways but they will need to come up with certain decisions regarding the company’s human resource strategy and its implementation. Communication plays an important role in this decision making process especially when the changes involve the people within the organization as Armstrong (2001) expounded that there should be an appropriate temperate and leadership when managing changes. Incongruous goals, opinions, and policies among upper-level executives can obstruct the cross-system cooperation required by the strategy. This impediment must be avoided at all times.
Line managers identify the staffing needs that are incorporated in the HR strategy, they help HR define the performance criteria for employees and assist in developing the selection tools. They are closely involved with HR in the implementation of HR strategy by allowing a dynamic partnership to thrive between them.
HR has the responsibility to implement and enact the policies within the organisation. They ensure that the policies are put into practice, hitting the organisation’s targets and goals as they are expected to be done. HR must establish itself as the driving force behind the strategy implementation effort. It must be emphasized that HR has the power to generate opportunities to bring employees together with managers and executives, leading from behind the scenes. Implementing the strategy means that HR must help employees to understand the HR strategy and comprehend the reason for the strategy. HR must also ascertain that employees commit to the strategy and take all possible opportunity to augment the employees’ commitment. Compliant to the Policies and Procedure
HRM practices can be substantial (Kanter 1985) because the successful implementation of HR strategies depends upon the behaviours of employees, and employee behaviours depend, in turn, upon the HRM practices a firm uses. Kanter (1984) claimed that employees within the company should at a certain extent be compliant to the policies and procedure of the organisation.
Adherence to company policies and procedure gives focus and direction to the organisation’s targets and goals as they are expected to be done leading to a more effective HR strategy.
Besides ensuring compliance, HR must also encourage a culture of pride in the firm’s own achievements; reductions of layers in the hierarchy; but also the improvement of lateral communication and giving increased information about company plans. Translate HR Strategies In To Policies
Armstrong (2012) cited Kanter’s phrase that HR strategies are action vehicles, they must be translated to policies that provide guidelines on decision-making and HR practices which enable the strategy to work.
As action vehicles, the strategies determine the long term goals and objectives of an organisation, and the adoption of courses of action wherein the objectives and other deliverables are clear, fixed and stated. Organisational Needs Must Be Identified
Armstrong (2011) believes that a significant stage in development and implementation of HR strategy is the identification of organisational needs to know the existing resources. Identifying organisational needs can be crucial for the company and it must be as precise as possible to deal with the various resources. An organisation must identify the priorities and importance of the organisation needs. There could be a need for training and development, career development, and organisation development. HR must examine these in view of their importance to the organisational goals, realities, and constraints. HR must determine if the identified needs are real, if they are worth addressing, and specify their importance and urgency in view of the organizational needs and requirements. HR Plans Must Be Up To Date
Lastly, HR strategies must be up to date a regular basis by evaluating the success of the plan and so the benchmark is being measured. This will determine the overall strategic plan if it became successful in achieving the organisation’s mission.
Keeping an up-date-to-date HR plan is beneficial to an organisation, as the plan is always relevant to changing times and the needs of the company. It is also an opportunity for the organisation to review, assess and make improvements or make necessary changes on the HR strategy. It’s a good practice to monitor the implementation of the HR strategy, it could be the guiding force in the organisation’s reviewing of employee performance, awarding promotions, approving leave, hiring and other related concerns.
This report will cover and identify specific HR strategies for an organisation and these strategies will be assessed and applied to the Boston Chocolate and Truffles Company as a rapidly growing business.
HR strategies suggest what the organisation intends to do to HRM policies as they are aligned and incorporated to the business strategies and company’s goals, objectives and intended deliverables wherein strategies are action.
Armstrong (2012) stated that different organisations have also different strategies and that there is no such thing as a standard strategy. However, some strategies and their intentions are quite general others are not they set out two types of HR strategies: general and specific.
General HR strategy focuses on the whole organisational in a macro perspective point of view. It’s a strategy wherein its proposal will be put into practice which will later have a positive result to the organisation performance. This strategy is likely to be expressed as broad-brush statement of aims and purpose, which set the scene for more specific strategies. It provides a general framework for the plan’s goals and define the scope of what the department must undertake and implement to achieve the plan’s goals.
General or Overarching HR strategy may be applied to Boston Chocolate and Truffles Co to some extent because it provides the general framework for the company’s goal-specific plans and paves the way to more intricate details as regards to objectives, mission, goals and deliverables within the company. General HR strategy impacts everything the department undertakes and what it expects to achieve. Overarching HR strategy is geared towards the development of the entire company and encompasses its overall business activities .
There are three main approaches which are: High performance management, high commitment management and high involvement management. High performance working involves the development of a number of interrelated processes that together make an impact on the performance of the company through its people in such areas as productivity, quality, levels of customer service, growth, and profits. This is achieved by ‘enhancing the skills and engaging the enthusiasm of employees’.
If one were to apply this particular approach to Boston Chocolate and Truffles Co, the focus will be the company’s performance based on the skills and enthusiasm of the employees. The benchmark would then be on productivity, quality, levels of customer service and profits. However, the disadvantage is that high performance approach pushes the employees to be productive. Areas of personal development, training and career enhancement for employees are often neglected. High commitment management approach emphasized the importance of enhancing mutual commitment. High commitment management has been described as ‘A form of management which is aimed at eliciting a commitment so that behaviour is primarily self regulated rather than controlled by sanctions and pressures external to the individual, and relations within the organization are based on high levels of trust.
Boston Chocolate and Truffles Co could also adopt high commitment management because this approach gives importance to the company’s employees by engaging them to commit to achieving the company’s goals. One disadvantage though is that the mechanism for “checks and balance” is self-regulated and based on high level of trust which could be detrimental.
High involvement management approach involves treating employees as partners in the enterprise whose interests are respected and who have a voice on matters that concern them. It is concerned with communication and involvement. The aim is to create a climate in which there is a continuing dialogue between managers and the members of their teams in order to define expectations and share information on the organization’s mission, values and objectives. This establishes mutual understanding of what is to be achieved and a framework for managing and developing people to ensure that it will be achieved.
The best approach for Boston Chocolate and Truffles Co is high involvement management, this approach focuses on communication and involvement. The continuing dialogue between managers and of their teams to define expectations and share information regarding the organization’s mission, values and objectives through high involvement management is vital if not crucial to the Boston Chocolate and Truffle Company’s success.
Next, is the specific HR strategies that covers areas such as: human capital management, knowledge management, corporate social responsibility, engagement, organisational development, resourcing, talent management, learning and developing, reward and employee relation.
Significantly, as the Boston Chocolate and Truffle Co strives to expand and continue to produce finest quality products it has to give focus particularly on the specific HR strategies that are applicable.
Since, one of the company’s objectives is to value employee, customers and other stakeholders, the employee relation strategies had been given emphasis since these strategies aid in defining Boston Chocolate and Truffle Co as an organisation. At Boston Chocolate and Truffle Co we give emphasis on employee relations strategies which include guidelines coaching managers and employees on how to handle employee relations issues to avoid grievance aggravation and its legal impacts, we advise them how to handle and document corrective action plans and disciplinary action. These also include investigating, obtaining statements, and making recommendations for further action.
Boston Chocolate and Truffle Co through its employee relation strategies identify the retention solutions to help improve turnover and employee morale, develop training solutions to help build a collaborative workforce, provide assessment solutions to help identify strengths and areas of opportunity for development of employees. These may be realized by creating programs that engage the man power such as community relations programs, recreational/social events, employee recognition programs, awareness programs for absenteeism, termination and retention.
Another strategy is corporate social responsibility this state’s about the business commitment on how to manage ethical and environmental responsibility therefore it is suggested that through the commitment of Boston Chocolate and Truffle Co to use fair-trade product mean continuity of helping people in the third world country communities therefore helping to protect mother nature in sustainable way.
Lastly, Boston Chocolate and Truffle Co is committed to enhancing its organisational development strategy, as the company grows and compete with globalisation, our company shall provide an ongoing, systematic program of implementing organizational change focused on understanding employee relations and high involvement management.
As a business entity, Boston Chocolate and Truffle Co understands the need for strategic HR functionality to be competitive and successful in the mainstream market specially when one considers the consumer demands for high quality products involving chocolates and truffles. HR is a vital part of the business process in Boston Chocolate and Truffle Co, it enables the people in key roles with HR’s leadership and mentoring to support both the staff and business as a whole. Boston Chocolate and Truffle Co believes in strategic HR leadership, with ideas for out of the box, aggressive yet compassionate thinking, as regards recruiting, retention and career development.
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