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Diploma in Business
Unit Number and Title
Unit 22 Human Resources Management Next Plc
For every organization be it small or an MNC, human resources are essential for areas that range from strategic planning to build the image of a company. One can considered HRM as a vital and comprehensible approach adopted by the management of an organization in order to manage the most valuable asset i.e. human resources who both collectively and independently make ample contributions in achieving the business objectives. The organizational functions of HRM mainly deals with employees related issues like pay, recruitment, performance management, development and training , wellness and safety, employees motivation, administration etc. There are many organizations where the line managers play the functions of HRM.
The main purpose of HRM is to make the best use of available human resources in order to attain the two primary goals of an organization irrespective of its sector. The first goal is to make an effective use of employee expertise and abilities for successfully achieving the working objectives, which is an organization’s eventual aim. In addition, HRM also pursues in getting ensured that all employees are contended with the work atmosphere along with the allowances and other benefits they are provided with.
Personnel management deals with managing of personnel within organization by planning, directing and controlling their requirements and the manner they contribute to various functional areas to achieve objectives of organization. Whereas, Human resource management is utilization of human resources to attain organizational objectives effectively that meets interest of both human resources and company. (Hendry, 2012)
The difference between personnel and human resource management is discussed with example of Deliveroo and Next Plc. At Deliveroo as it is a start-up company with limited investment and resources currently operates with personnel management. They are deliver agents that serve customers enjoy restaurant quality food at comfort of home. Whereas, Next Plc is multinational retailer of clothes, footwear and home decor products in UK. They follow HRM process to look at various functions and employee management.
Human Resource Management
Personnel management focuses on growth, contribution and control of employees to achieve business aims. Example, Deliveroo follows a system where employee’s contribution is made efficient to deliver customer excellence. (Hendry, 2012)
HRM focuses on betterment of policies and planning to use available employees to achieve best possible business objectives. Example, Next Plc has specialised HR departments that sees policies and management of employees to achieve individual and business objectives.
Personnel management deals with planning, organising and controlling activities in Deliveroo to provide satisfaction to employees and seek their welfare by systematic process.
HRM process in Next Plc works to improve working environment within company to achieve efficiency of employees and also tackles their concerns under effective management of company policies. (Hendry, 2012)
Deliveroo follows this traditional approach of personnel management to organize work and manage their employees in better way.
Next Plc follows HRM to control futuristic concerns like employee turnover, production cost etc
At Deliveroo decision process is authorised to management and personnel management function have less power.
At Next Plc, all power related to management of employees concerns, policies etc is under authority of HRM department.
At Deliveroo main objective of personnel management is betterment of administrative functions. (Hendry, 2012)
At Net Plc main objective of HRM is betterment of policies to deal with employee concerns and meet their welfare.
Human resource management functions assist Next Plc in achieving effectiveness of both managerial and operational activities by:
Line managers are people concerned with implementation of process that supports achievement of functional activities.
They support functions of HRM by following below discussed roles and responsibilities in Next Plc:
Legislative and regulatory framework helps to implement human resource management policies to provide employee welfare and protect interest of both company and employee in best manner.
The impact of legal framework can be analysed through effect on HRM functions of Next Plc, which are:
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Human resource planning is the process that maintains planning of activities within organization by identifying supply of labour and demand for production, availability of resources, estimated needs and future forecasts to achieve organizational purposes optimally. (Monk and Wagner, 2012)
In the case study organization major concerns are high employee turnover and current recruitment and selection process which are ineffective in hiring quality resources. Thus proper human resource planning has to be undertaken and the stages involved can be outlined as:
Case study organization
The case study organization does not have a proper recruitment process and policies currently which has resulted into selection of employees who are not of good quality therefore leading to high employee turnover which is a major setback. The practices that are employed during recruitment lack structure as there is no process included for short listing of CV/Applications received. Candidates are called for telephonic interview which also lacks proper format of questions which should be asked to verify background, technical knowhow etc. Thus process lacks serious measures to root out quality candidates. (Madera, 2012)
At Next Plc a structured process of recruitment is practised which is effective in matching talent of resources with requirements of job position. The activities that are followed for recruitment includes identification of potential vacancies within various departments and specialised areas. Then once this is done skill requirement matching to specialised roles is assessed and requisition to call prospective employees is drafted. Next advertisements of vacancies are made on various sources which is followed by sorting of application received. The potential match is called for preliminary interview.
Also selection process is not developed to reach out to best fitting candidate for right job as it includes psychometric test and aptitude test only which checks personality of candidates. It lacks design of assessment tests such as simulation based exercises which is effective in testing candidates logical response to handle real work situation related to job.
During selection process Next Plc follows steps to eliminate less fitting applicants to find out the right match. The shortlisted candidates are called for preliminary interview where background and prior experience is verified. This is followed by written test to check candidate’s subject related knowledge. The successful candidates are then invited to assessment centre where real exercise related to job is given to test their responses to various work situations. The candidate who is sorted out here is called for face-to-face interview with project and line managers. The reviews received in this round are used for final selection. The final candidates are called for medical examination and those who clear receive offer letter for appointment. (Madera, 2012)
The current R&S technique applied in case study organization is not appropriate to find out right employees for right job at right time. This is because the process is not structured and is very simple to identify the true potential of applicants. Also it misses sort listing of CV’s to find potential match according to preliminary information received. The candidates are called for telephonic interview and asked very basic questions that lacks proper format to identify true skills, experiences and useful information that can be related to person specification and job description for the vacancies. Further, the psychometric and aptitude test conducted to select final candidate lacks assessment criteria that can be used to identify quality of candidates. Thus the current R&S process needs to be redesigned to match competency of candidates with needs of job. (Stahl, Björkman, Farndale, Morris, Paauwe, Stiles, Trevor and Wright, 2012)
On the other hand, the R&S technique followed in Next Plc is more structured to determine competency, skill and logical ability to handle various work related problems and demands. The resume sorting process matches eligibility of candidates according to initial information received to fit in job requirements. Then preliminary interview followed by written test helps to decide on actual subject knowledge and technical abilities of candidates. Thus extra applications are eliminated in the first two steps of the process. The successful candidates are assessed further during simulation exercise followed by interview with line and project managers. This helps to filter only best and deserving candidates who fully justify the needs of job position. Finally the medical examination helps to test fitness of candidates before appointments and contract letter is handed to selected employees. (Stahl, Björkman, Farndale, Morris, Paauwe, Stiles, Trevor and Wright, 2012)
The term motive can be described as a notion precipitating an individual to act in a certain way. Moreover, motivation is a subjective process further making a person step ahead towards the goal. One cannot directly observe motivation like intelligence rather it can be understood only by observing the behaviour of a person. Desire and ambition mechanize motivation therefore, in the absence of these elements, motivation too is missing. Motivational theory is a concept describing the stimulation of resourceful behaviour within the employees. With rise in market competition and pressure of retaining the skilled employees more and more organizations are now keen in applying the motivational theories to keep the employee relationship motivated because of the fact that motivated employees are more dynamic at work further making the best use of available resources. (Deci and Ryan, 2012)
On the other hand, reward comprises of monetary provisions that are usually provided to the employees and might include cash pay or other broader benefits such as pensions, paid leaves etc. Employees in general get motivated in seeing a fat paycheck and doing a kind of work, which makes them satisfied. When an organization offers the employees with additional rewards, they tend to get motivated in walking extra miles for achieving the company’s business goals.
Link between motivational theory and reward in Virgin Media: Employees with increased concentration and motivation are likely to make fewer blunders at work thereby, resulting into minimum workplace conflicts, more sincerity towards the company and less absence from work. Lack of motivation further leaves a negative impact on employees efficiency and ultimately at the work quality. One can see that Virgin Media firmly believes in motivating and rewarding its employees. The management believes that its business is relatively dependent on the customers and employees thereby, encourage the employees in being unique in their work and maintain varied lifestyle outside work. Moreover, Virgin Media assists the employees in striking a balance amid personal and professional lives and rewards them through flexible working, free health benefits, discounted Gym memberships, paid holiday trips etc. At the end of every financial year, Virgin Media urges the employees to participate in an employee satisfaction survey allowing them to express their views on every aspect of their job. By taking feedbacks from the employees, the company ensures that the employees are satisfied with the measures undertaken by the HR department for keeping them motivated. (Deci and Ryan, 2012)
There is a very relationship amid reward system and motivation. An employee can get motivated from many ways and having an adequate reward structure is one of them. Fulfilment of intrinsic needs result into strong motivation within the employees. A person as an employee craves for the fulfilment of his/her psychological needs such as acceptance at workplace or in team, recognition and respect, encouragement from superiors etc. At Virgin Media, such needs are fulfilled through promotions, empowerment to make decisions, team contributions, job rotation, employee engagement etc. that eventually cultivates a strong link between the management and employees.
One can describe Job evaluation as a methodical process adopted by the HR department in order to assess the relative value of all the jobs within an organization. For assessing a job’s value to the employer and providing an internal ranking, Virgin Media conducts a thorough analysis of tasks of each position and its responsibilities, expertise and skills needed. Job evaluation is the assessment of a certain position’s internal prospect and not the person holding the position. Job evaluation, in addition also contribute in designing a job by further endowing the organizational situation and job’s value to the process of recruitment and promotion by furnishing job analysis on the competencies and skills that are needed for meeting the requirements of a job. (Armstrong and Taylor, 2014)
Job analysis is the starting point of job evaluation and any job cannot be assessed unless it is analysed. By analysing a job, one can determine the duties and responsibilities, job’s nature and accordingly decide on qualifications, skills and knowledge needed for performing a certain job. Job analysis is helpful in analyzing which tasks are important and how to carry them.
Job evaluation process concentrates on certain factors that are simultaneously considered while determining pay in Virgin Media. The factors are:
One can see a close relation amid job evaluation and pay although the strategy of payment might differ from company to company across the globe. At Virgin Media because of its large size, job evaluation is one of various criteria’s that have been embraced for determining pay. Based on the case study of Virgin Media, three methods of job evaluation are practiced namely ordering, classification and point method. The ordering method commonly known as ranking method ranks every position available within the company, from highest to lowest. The best example of the ranking method is the hierarchy of an organizational chart. Ranking method is difficult in establishing and maintaining in large sized companies with multiple layers in hierarchy. (Armstrong and Taylor, 2014)
One can describe reward system as an approach that is both planned and structured of rewarding one or more persons for acting in a desirable way and achieving an expected outcome. With rise in business competition more number of organizations is looking ahead in improving the products/services quality while lessening costs. Hence, as companies are in need of getting more output from the employees, employees too are looking to get more benefit from the companies. Reward system is a key method of keeping the employees motivated in rapidly changing work habits and key behaviours that eventually benefits the business. (Rummler and Brache, 2012)
Effectiveness of the reward system at Virgin Media:
Performance management can be described as a methodical process in which the employees of an organization are involved either as an individual or as a group member for developing its effectiveness in achieving of the predefined goals and missions. Performance management covers work planning and setting expectations, constant performance monitoring, evolving employees performing capacity, annual performance rating and rewarding. (Gomez-Mejia, Berrone and Franco-Santos, 2014)
Methods used in Virgin Media for monitoring employees performances:
Cessation of employees involves different methods by which a company can terminate an employee’s employment contract. Key reasons behind employees’ cessation mainly are inability of getting promoted, poor performance, job redundancy and misconduct. (Bardoel, Pettit, De Cieri and McMillan, 2014) According to the case study of Chicken Master, Bob the owner has hired 54-year-old Faisal by getting impressed by his 15 years of experience as a restaurant management but soon he turned out to be a bad judgement. Despite of been experienced Faisal never kept the front of store and the kitchen clean and stocked and never supervised the restaurant staffs. Bob noticed that he regularly took time off for personal reasons, watch pornography on the computer, email his wife, helping his daughter with homework and even designing his own restaurant. He would also take restaurant’s equipment for personal use that was against the policy mentioned in the employee handbook which he was aware of. Hence, Bob had to terminate Faisal for his poor performance and unacceptable behaviour at work. (Bardoel, Pettit, De Cieri and McMillan, 2014)
Other reasons of cessation of employment:
The employment exit procedure the Chicken Master is conducted by the owner of the restaurant Bob. He ensures that the exit procedure is smoothly executed and easy for the employee to understand. Bob makes sure that the employee is made aware in advance in case of termination so that he/she can look out for another job while if an employee wishes to resign Bob tries to understand the reason behind the decision. Chicken Master ensures that fair methods are used in the entire process and the employee needs to fulfil an exit form. Once the process is over, a notice period of two weeks is mandatory to serve but in case an employee refuses to serve the period, 25% of pay is deducted. On the last day at work the employee is offered an experience certificate and a thanking letter. (Si and Li, 2012)
At Citigroup, employment exit procedure has a systematic approach where in the first stage the HR Manager aims in retaining the employee if he/she is valuable for the company. However, if the employee is determined to resign then a feedback form is provided where they mention the reason behind resignation and details of their experience with Citigroup during their tenure. After the form is submitted in the HR department, the employee is briefed about the notice period of a month and the line manager is informed so that he understand all the projects he/she handled and take over all official documents. The accounts department is also notified and on the end of the notice period, the salary is cleared and closed. The HR Manager offers the employee with references for future endeavours and a memento as a parting gift. (Si and Li, 2012)
The impact of legal and regulatory framework on the arrangements of employment cessation is very high with respect to the Chicken Master. The UK government has enforced employment laws to safeguard the employees rights and ensuring that companies do not practice any sort of unfair practice while cessation of employment. The legal and regulatory framework protects an employee form being unreasonably terminated on the grounds of discrimination, retaliation etc. Moreover, the legal and regulatory framework prohibits the restaurant from getting involved in any unfair practices while terminating any employee. Hence, when Bob found that Faisal was constantly violating the company policies and was indulged into unacceptable behaviour at work, he gathered enough evidences against Faisal to prove that the decision to terminate him was not unreasonable when Faisal dragged Bob to the employment tribunal with a false claim that he was a victim of age and race discrimination. The panel will cross check all the evidences submitted by both the parties and if Chicken Master is found guilty then Bob will have pay the penalties imposed by the tribunal. On the other if Faisal’s claims turn out to be untrue he might lose the chance of getting back at work and might also negatively affect his future. (Jennings, 2014)
Finally, we can conclude by say that every organization for gaining success in the long-term period must efficiently manage its most valuable asset know as human resources. In order to do so, organizations must implement an effective HRM system which will also help them in smoothly governing the internal processes. In this report an evaluation of the HRM process has been done by considering the example of Next Plc allowing having a broader insight into the implications of HRM into an organisation’s business model.
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