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Posted on July 28th, 2012, by

Table of contents

Introduction

Differences in the style, strategy and outcomes of HRM in the companies

Significant factors in the organizational profile of companies

Advantages of companies’ approaches

Works cited

 

Introduction

Human resource management plays an extremely important role in the contemporary business environment. In this respect, the Company 1 and the Company 2 should pay attention to the development of an efficient human resource management. In fact, the Company 1 is in a particularly dangerous position because it has a high personnel turnover and it employs representatives of minority groups. Such a strategy can apparently raise serious problems in the future, even if the company does not need well-qualified labor force at the moment. As for the Company 2, it also has problems with the employment well-qualified and successful managers, who are unwilling to transfer that clearly indicates to low prospect and career opportunities in the company that is also a serious problem, which can undermine the position of the company in the future.

Nevertheless, it does not necessarily mean that both companies will face insurmountable problems. In stark contrast, the aforementioned problems can be solved successfully on the condition of the implementation of effective human resource management strategies and the development of effective organizational structure along with the formation of a positive organizational culture. For instance, the Company 1 can use the cultural diversity as a powerful tool to boost the development of the organization if the management of the company proves to be able to use the full potential of cultural diversity of the company. In such a way, it is obvious that the Company 1 and the Company 2 have different style, strategy and outcomes of human resource management. Nevertheless, they can use similar strategies to achieve positive outcomes, although each company should apply its human resource strategies taking into consideration its own, unique specificities.

Difference in the style, strategies and outcomes of HRM in the companies

On analyzing human resource management in both companies, it should be said that the companies use quite different approaches which determined the difference in the style and outcomes of human resource management. In this respect, it should be said that the difference in human resource management of both companies is influenced by the different organizational structure and goals companies attempt to achieve. The most striking difference refers to the recruitment of the personnel, its qualification and policies of companies in relation to employees.

First of all, it should be said that the Company 1 employs a large number of low and semi-qualified employees, which are not supposed to perform highly complicated tasks and fulfill highly responsible functions. At the same time, the company attempts to balance the professional level of its personnel since low-qualified employees are managed by well-qualified managers. However, it is obvious that the company does not have great expectations in regard to its employees and they use them as a relatively cheap labor force performing simple, routine tasks.

As for the Company 2, it does not employee low or semi-qualified employees. Instead, it is focused on the employment of managerial, administrative and clerical staff. In such a way, the qualification level of professionals recruited by the Company 2 is consistently higher compared to a part of the staff employed by the Company 1. The Company 2 focuses on different professionals that determined the difference in its human resource management.

To put it more precisely, the Company 2 is more concerned with the employment of professionals who are able to perform their job well and who can contribute to the consistent improvement of the organizational performance.

Consequently, the company has to pay more attention to applicants who want to be employed by the company and, what is more, the company should develop efficient recruitment strategies, which allow the company to select professionals who are really the best among all the applicants. Otherwise, the company will face a risk of the deterioration of its marketing performance because of the inability of employees to perform their professional functions effectively.

In this respect, the Company 1 is totally different because it does not need to pay much attention to the recruitment of low-qualified specialists since the qualification itself does not really matter. Therefore, the company can recruit employees on the ground of factors other than their qualification, for instance, wage, enthusiasm, effectiveness and productivity of potential employees, etc. On the other hand, the company also needs to develop efficient recruitment strategy in relation to specialists working at the upper level of the organizational structure, such as managers. At this point, the Company 1 is similar to the Company 2.

In such a situation, it is quite natural that the companies different human resource management styles. In fact, the Company 1 does not attempt to prevent the high personnel turnover. Moreover, the company simply ignores this problem and does not even view the personnel turnover as a serious problem. Taking into consideration the high turnover rate in the low-qualified personnel only, such a position of the company can be justified, although it raises the problem of the development of positive interpersonal relations of managers with new employees.

The Company 2 uses a different human resource management style. Unlike the Company 1, the Company 2 attempts to prevent the personnel turnover by all possible means because the personnel turnover is a direct threat to the successful marketing performance of the company and its normal functioning. In this respect, it is worth mentioning the fact that the company suffers from the deficit of experienced top executives and highly-qualified managers, who are unwilling to transfer from other units of the company. Hence, the personnel of the company is crucial for its normal functioning because professionals working at the Company 2 gradually acquire essential experience, increase their professional level and are prepared to work within the organization, while the high turnover rate would undermine the normal functioning of the company because new professionals would need time for adaptation to the organizational culture and environment. In fact, as the company employs managerial, administrative and clerical staff the problem of the personnel turnover would engender problems in the interaction between professionals who can hardly start work effectively with professionals whom they hardly know and whose professional qualification is uncertain.

Furthermore, another important difference between the companies is the cultural background of employees working within the companies. The Company 1 employs representatives of minority groups that may cause certain tension because of cultural barriers between employees and managerial staff, which can have a different cultural background, especially top executives. However, as the Company 1 employs a large number of low-qualified employee’s cultural difference are less significant for this company than for the Company 2. The latter, in its turn, is focused on the formation of a homogeneous organizational culture employing local specialists mainly. In addition, specialists from other countries are not eager to transfer that makes the orientation on the local professionals the mainstream strategy of the Company 2’s human resource management.

As a result, the companies develop absolutely different organizational cultures. On the one hand, there is the Company 1, which is characterized by the cultural diversity due to the employment of representatives of minority groups. On the other hand, there is the Company 2, which personnel have a homogeneous cultural background.

Significant factors in the organizational profile of both companies 

In actuality, it is possible to distinguish several factors that determined the profile of both companies and which influence their performance. Moreover, these factors may raise problems, such as communication gaps or the necessity of introduction changes in the organizational structure and performance. Among the major factors, defining the profile of both companies it is possible to name the qualification of the staff, turnover rate, and cultural background.

Basically, the cultural background of employees is important because it can raise communication barriers which can influence the organizational performance. The Company 1 is vulnerable to communication gaps because of the cultural diversity, but the Company 2 also needs effective communication between all elements of the organizational structure and all professionals working within the company. In actuality, one of the most important factors that influence the organizational performance and organizational profile of both companies is the communication between managers and employees. Today, communication plays an increasingly more important role. It should be said that the development of the new technologies and changes in the traditional management style lead to the necessity to use communication more effectively since it provide ample opportunities to make management more diverse and, therefore, more flexible that is one of the essential conditions of a company success in the modern world.

Basically, a professional and successful manager should to be able to communicate effectively with employees. At the same time, the effective communication implies that a manager should develop effective skills and knowledge sufficient to develop normal contacts with employees and maintain. It is obvious that if a manager fails to establish proper communication channels between him/her and his/her workers, the main function of management to manage people – will not be fulfilled. On the other hand, it is necessary to remember that through the communication a manager can achieve positive results and improve the company’s performance through the effective use of communication in his/her relationship with employees that will make them work more effectively and all the steps taken by the company’s administration will be more understandable for employees.

Communication  plays an extremely important role in the contemporary business environment because manager-employee relationships have changed consistently. As a result, effective human resource management should be grounded on the effective communication between manager and employees. In this respect, it is important to understand the significance of the development of positive interpersonal relationships between employees and managers. However, it is impossible to develop positive interpersonal relationships if there are gaps in communication. In such a context, managers need to be able to adapt different communication style to meet expectations of their employees. What is meant here is the fact that managers should avoid communication gaps and keep their employees informed about the development of the company, its strategic goals, objectives as well as challenges the company may face. At the same time, mangers should involve employees in the development of the strategy of the company that implies the effective communication between managers and employees. In actuality, employees should have an opportunity to get detailed information on changes managers are going to introduce or new policies the company starts in order to be able to respond to such changes. Managers, in their turn, should receive the employees’ feedback and respond to it respectively, taking into consideration the position of employees.

If they ignore the position of employees, there is a high risk of emergence numerous internal conflicts within the organization.

Many conflicts in organizations may be to a significant extent determined by the problems in communication. In fact, it proves beyond a doubt that such conflicts result from the gaps or problems in communication because if there is a conflict between a manager and employees or between a manager and an informal leader of employees, than there is some misunderstanding between both parties. This means that a manager has failed to explain clearly the position of the administration of a company and convey it to employees. Such problems are particularly serious when large companies operating in different countries of the world are involved. For instance, companies operating worldwide faced serious problems when it launched redundancy. In actually, the personnel of the company was extremely disturbed by the reduction of the number of employees within the company and, what is more important, even those employees that were not dismissed were consistently affected by such a policy. As a result, the atmosphere within the company has deteriorated dramatically since employees felt insecure in the instable environment and were doubtful about their future (Pine and Gilmore 139). In other words, employees did not know what can happen in the future that decreased effectiveness and productivity of their work.

On analyzing the causes of such a problem, it turns out that the major problem was the lack of information employees had about the policy of the company which simply attempted to get rid of low qualified or incompetent employees and create a new team of professionals who could be able to enhance the performance of the company.

Consequently, managers simply did not inform employees about the reasons for the reduction of the number of employees. This fact reveals serious problems in communication in the company since managers are unable to explain the position of the company while employees are unable to launch a dialogue with the administration in order to improve the situation.

The situation discussed above perfectly reveals the importance of effective communication of manager with employees. In fact, the effective communication implies that managers and employees are able to communicate with each other freely. This means that the policy and strategic development of the company is clearly conveyed to employees by employees but it does not necessarily mean that mangers should dominate and oppress their employees, preventing any initiatives of the employees and just get them acquainted with the strategy and possible changes the administration decides to implement (Schein, 1999). In stark contrast, the major goal of communication is the maintenance of dialogue between managers and employees, i.e. employees should not only perceive essential information about the upcoming changes or policy of the company but they should also be able to influence decisions taken by the company (Gitlow, 1997). In this respect, it is through communication they can define their own position and attitude to the policy of the company and convey it to managers.

Obviously, if the interests of both managers and employees coincide there are no contradictions and, naturally, there is no opposition within a company. As soon as the views of managers and employees differ or, when there are some gaps in communication leading to the lack of information or misunderstanding between managers and employees, the conflicts are inevitable (Wetherbe, 1996). In this respect, the role of communication is getting to be particularly important because it is due to the communicative skills a manager can gain the support and understanding of employees.

At the same time, effective communication leads to the stable and effective work of employees because they know what they are actually working for and what the policy of a company actually is (Howard, 2000). Moreover, the effective communication provides essential flexibility and diversity of management because it prevents internal opposition from the part of employees and engenders trust of employees in relation to the administration of the company. Otherwise, managers have little opportunities to improve the situation

Before taking any steps, it is necessary to analyze the situation more carefully, and maybe more options will appear in future. Efficiency of a manager is usually estimated by means of his/her ability to influence productivity of the work force, which results from his/her education and work experience. According to J.L. Heart, one of main tasks of a manager is to create vision of the company, to inspire and control, to direct the action of the workforce by using personal qualities, such as the ability to influence people, charisma, enthusiasm and others (124). Obviously, these qualities can contribute to the effective communication improving the attitude of employees to managers. The latter receive an excellent chance to involve employees in the process of development of plans of a company through a permanent communication and, in such a way, management becomes more diverse and flexible since managers take into consideration the position of employees and, therefore, they are able to take decisions or implement changes in accordance with the current needs of a company and employees without harm to strategic goals of the company.

The role of communication in the modern business can hardly be underestimated. In fact, communication is a major tool that can help maintain stable and reliable work of a company through the creation of positive relationships between managers and employees, but, what is probably even more important, communication should not be a one-sided process (Bovee and Thill, 2005). Instead, communication does not imply the informing of employees about plans of a company, but employees should be in contact with managers in order to influence decisions taken by the company and, therefore, compromise may be found that opens new opportunities for more divers and flexible management.

At the same time, both companies should be prepared to changes because the contemporary business environment is rapidly changing and the companies will not be able to survive in a highly competitive environment without implementation of changes, while the Company 1 is already vulnerable to the high personnel turnover which inevitably leads to the necessity of changes in the management style to organize and manage the work of new employees efficiently in such a way that it could meet the existing standards of the company. At the same both companies are apparently not prepared to changes, although changes in the organizational structure and improvement of interaction and interpersonal relations between manager and employees can be highly beneficial for both organizations (Bovee and Thill, 2005). Nevertheless, the idea of the change, whatever good it is, does not necessarily means that it will be really good or effective on its realization. In this respect, the effective change management is of a paramount importance. At this point, it is necessary to underline that the process of change is quite complicated and implies that the change is not a one-side process but rather a cooperative work of the entire company.

Speaking about the change management, it should be primarily said that the first stage the change process is the planning for the change itself. This means that the change should be carefully planned in order to face the least resistance during the stage of its implementation. In other words, before implementing the change, it is necessary to carefully analyze the current situation and perspectives of the company and its current management model and style. On realizing that the current management is ineffective or that it threatens to the future perspectives of the company, it is necessary to prepare the company, namely its personnel, to the implementation of the change. In fact, it is very important to explain to the personnel that the change that is planned to be implemented is really essential and, what is probably even more important, that this change will cause no harm to employees but, in contrast, it will improve the performance of the company, at large, and conditions of work of each employee, in particular (Schmitt and Simonson, 1997, p.315).

Furthermore, on planning the change and preparing the personnel, it is necessary to start its practical implementation. In fact, on implementing the change, it is important to take into consideration the possible managing resistance which may sprang when the implementation of change is not properly prepared. At the same time, while implementing the change it is necessary to inform the personnel about the future perspectives of the company and the effects of the change. In other words, employees as well as managers should have a clear vision of the perspectives of the company and their own future in the result of the implementation of the change. This will contribute to the higher cooperation of the personnel and, therefore, more effective implementation of the change.

At the same time, it is necessary to remember that the implementation of the change may need certain changes in order to increase its effectiveness. In this respect, it should be said that it is important to receive feedback or some response from the personnel on the implementation of the change. In other words, the head management should receive the reaction of the personnel on the change and the personnel should have an opportunity to give its own recommendations concerning the practical implementation of the change, while the head management should take into consideration the position of the personnel while implementing the change. Ideally, the implementation of the change should lead to the consolidation of all people working for the company making them all conscious of the positive effect of the change.

In this respect, it should be said that the past, autocratic experience of FedEx Corp. may interfere in the process of the implementation of the change and produce a negative impact on its final realization preventing the company from the consolidation over the change because it is initiated from the head management and, consequently, it may be viewed as another change that is imposed to the personnel by the head management. In such a situation, it is possible to recommend involving the personnel in the planning and implementing of the change. For instance, the head management should primarily inform the personnel about the change that is planned to be implemented within the company but this should not be a simple informing of employees but they should have an opportunity to provide their own feedback on the change. For this purpose it is possible to use questionnaires to find out what employees actually think about the change and even receive the feedback as well as some recommendations concerning the planning and implementation of the change. In such a way, the personnel will participate and, therefore, anticipate the implementation of the change.

The qualification of employees and personnel turnover are also important since the development of business will inevitably raise the problem of the introduction of new technologies which will need the employment of qualified professionals. In this regard, the Company 1 is less prepared to such a change than the Company 2. At the same time, the high personnel turnover destabilizes the situation within any company because new employees need time for adaptation.

 

Advantages of the companies’ approaches

Basically, each company has its own advantages. In this respect, it is necessary to remember that, at the moment, the companies have developed strategies which they consider to be the most efficient in the current business environment. However, it is important to understand that the business environment is not static and unchanging. In stark contrast, the business environment keeps progressing constantly and both companies should take it into consideration and come prepared to introduce changes to adapt to the new business environment. In this respect, it should be said that the approach used by the Company 2 is more prospective because the company is focused on the employment of well-qualified professionals and, what is more the company is concerned with the retention of the personnel and prevention of the personnel turnover. As a result, the company develops a solid organizational structure where people get used to work together and, therefore, they are able to work effectively. In contrast, the Company 1 fails and does not attempt to prevent the high personnel turnover. In the future, this strategy may lead to the widening communication gaps between managers and employees. In addition, the Company 1 may face a problem of communication gaps because of the difference of cultural background of employees and managers. On the other hand, cultural diversity can be used for the mutual enrichment of professionals working within the company, but it is possible on the condition that employees are qualified enough to share knowledge and cooperate effectively to perform complicated tasks. Hence, the approach used by the Company 2 is apparently more advantageous and prospective.

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