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Posted on March 14th, 2013, by

The human component, employees, staff are the foundation of any business and one of the most important elements on the path to success and prosperity of the company. Therefore, one of the fundamental systems of any modern organization is a system of human resource management. HR-consulting is a set of measures aimed at creating, implementing and maintaining effective personnel management system of the enterprise. HR-consulting can help identify weaknesses in the personnel management not seen by the top-manager, determine the need for staff and optimize its number, reinforce the motivation of staff, regulate salaries, etc.
HR-consulting is necessary for (Noe, 2009):

The organization of staff service a young or rapidly growing company, which decided to implement a comprehensive system of personnel management;
The development of new technology – a modern company with the evolving structure of personnel management that increases the range of its own HR technologies (e.g., introduction of new motivation systems, organization of staff training and development schemes);

Reorganization of staff service a modern organization with the fully formed structure of personnel management that has all HR technologies (selection, adaptation, motivation and promotion of employees), but lacks their well-honed coordination;

This becomes possible by using new management tools, different organizational innovations, and competition principle in recruiting, optimization of salary, improving socio-psychological climate in the organization.

Further, we’ll analyze the situation formed in the organization, point out the main problems it faces in terms of HR policies, and determine possible solutions and methods for introducing urgent organizational changes.

HRM/ER issues within the case
The case describes the organization, coming through a number of difficulties and finding itself in the need for urgent organizational change. While the business units of the organization continued losing profit and the whole organization faced keen competition and fast market share falling, there was no consensus among the executives about the level of crisis in the organization, mostly because they had no private sector experience and no general understanding what kind of leadership was required.

In the result of ineffective leadership policies, the organization had to come up with downsizing practices over the past two years, reduce the number of valuable and highly professional workforce from over 5000 employees up to 2000, as well as cut the expenditures and further, fully close the activities aimed at employee training.

The company also abounds in long-serving personnel, described as paternalistic, bureaucratic, risk averse, conservative and mechanistic. Though there is a group of young managers full of ideas, they constantly meet the wall of bureaucracy culture formed in the organization. In addition, the executives do not show understanding of diversity management, though the workforce and customers are very diverse in their nature. This mostly influences one-size remuneration policy and absence of compensation, benefits or recognition for extra working hours and expressed progressive ideas. Being put in such circumstances, the personnel is generally unsatisfied, unmotivated and often talks about leaving.

On the whole, the company doesn’t have its core objectives, strategic plan, and corporate culture corresponding to contemporary standards, as well as it no more has trust and loyalty from its employees. On the basis of these facts, we can formulate the following main issues and tasks the HR/ER consultant should deal with:
1. Facilitation of the refinement of strategic objectives and programming of organization’s development process;
2. Development of adequate corporate culture;
3. HR audit aimed at minimizing the risks of personnel management (with the emphasis on situation in the wage system, mass reduction of workers, and training);
4. Development of the corporate competency diversified model, which will form the basis for the formation of uniform standards for planning, recruitment, assessment, training and development of the staff;
5. Development of the complex motivation system based on objective evaluation of each employee’s performance;
6. Development of the system of professional knowledge and competence improvement.

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