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The increasing globalization of the economy imposes some changes in the business environment and companies have to pass from a local vision to global vision. And as other support functions (marketing, finance), management of human resources must be internationalized to be adaptable with the business reality. These evolutions have implications for the role of human capital in the organization and leading strategy and allow an increasing power of HRM. Today, the sphere of activity of an HRD of a multinational is more important and diverse than older Scientific Organization of Labour. The human resources approach is different. Previously, companies were cost oriented. Since the 90s, the work force was considered as a resource that the company must optimize. Thus, operating in a socio-economic instability where restructuring, mergers and outsourcing are the heart of concerns of the company, the HR function needs to adapt and expand his sphere of activity.
HR as a profession doesn't have the same evolution process than other fields such as Sales, Accounting. In fact, the HR's role within organization varies, it depends of the organization, the size and the geographic location of the company. It represents a personal skill that we have to grow and develop in the future.
However, it can be a delicate to make an efficient allocation of human resources if the organization has different culture or nationality. Indeed, the success of mergers with different nationalities is in many cases limited by poor understanding of cultural differences. Thus the consideration and understanding of the cultural differences will be the key of a successful implementation of European and International management of human resources.
In this report, I have decided to choose the France Télécom group, more specifically Orange, which is the brand of the group for the telephony and Internet in Europe. This choice could be explained in one hand because I worked for this company during one year and I really appreciated this experience, it allows to me to discover different fields in this group (HR, Sales, and Communication). On the other hand, France Télécom is the main French telecommunication company and the 105th global company. The group owns Orange with 100% of share. That is why, I think it would be interesting to study this company and see what is the strategy and HR planning in Europe, the organizational alignment and agility of it. We will also focus on the workforce engagement, the capability and capacity; the succession planning and the European culture and international HR management.
An overview of HR in Orange France Télécom
In Europe, the human resource function is changing. It doesn't have any more the limited role of administrative task. Previously, 90% of his time was reserved for the entire administrative part, with only 10% for the strategy part. Today, the trend is the contrary. It is considered as a part of the overall performance of the company, with its human capital. For this, she will devote 90% of his time to corporate strategy and just 10% for administration.
In order to develop the overall performance of the company, Human Resources should develop a greater coherence between the strategic and operational management. To reach this objective, according to Olivier Barberor (HRM of France Télécom group since 2009), the group needs to formalize the goals of Human Resources, which are coherent with the strategic objectives of the company, define and analyse relevant indicators to establish and adjust action plans.
The human resource managers will have to convince all staff to invest in objectives of the company, which was not the case before. The administration staff will be replacing by the human resources department. It will also have to learn to manage workforce talent within the company.
Today, globalization is also applying to talent. Companies look for expertise and no longer only qualification. These talents are in necessarily from very high level of study. They are simply people who stand out. We are not any more in a traditional recruitment, and this is the new strategic function of Human Resources Management. It should be able to pick talent elsewhere if it does not find it near its establishment. It needs to be able to find it abroad.
Within France Télécom a kind of standardization of tools of managing human resource are set (in terms of evaluation of the works of the staffs in particular, while the behaviour in mobility continues to diverge), they remain nevertheless partial. Most of the instruments of the policy of managing human resource as recruitment and system of incentive (such as wages) keep national bases in connection with legal and institutional specificities.
Among the observed convergences, the researchers found at first that more and more companies use decentralized structures, connected to the intervention of new economic constraints in the activity of research. The first objective being to reduce at most the time of launching a product on a new market, the studied adopt more and more systematically a Â«management by projects" preferred to the regular management.
However, the issues are still important especially between the evaluation of the persons and the evaluation of the activity. The systems of incentive particularly in their wage dimension, show a big heterogeneousness, linked both to the nationality of firms and to the national regulations.
The Boston Consulting Group realised with the European Association of Human Resource a study that specifies the mane stakes concerning HR in Europe for the next years. These stakes have to been reinforced because they constitute the main weaknesses of Human Resource in the companies.
The 5 stakes that came out of the study are :
"Know how to attract and manage effectively individuals with high potential of the whole world "
It means that companies have to find the best person for the job and especially manage their ego, their situation and their potential, encourage them to do always better and especially make them comfortable at work.
"Manage the challenge of an ageing workforce and the retired massive departures"
It means that some post will disappear after the retirement of some people, but it also means, that elder people in the company has to be "updated" to remain competitive
"Reinvent the vocational training when the individuals change regularly of company, even profession "
Nowadays people do not keep the same job in their whole life, and companies have to provide them best formation in case of unemployment or in case of changing post, (EG : a company propose to a professional marketer financial formation to be polyvalent).
"Develop the balance professional life - private life, in the era of the increasing distance of the employees with their work"
Nowadays people feel that a job is just a way to have a good personal life, and also feel that they have to scarify one of them to be happier in the second, companies have to focus on this state of mind.
"Give to the managers weapons to manage the change and the cultural transformations"
In this century everything is evolving so fast that some people cannot adapt to the cultural transformations, managers have to be prepared to manage all those evolution. (EG : At the beginning of the 21th century, a lot of employees never work with computer, and the increase of the Internet using was completely non mastered).
Strategy & HR Planning in Europe
The Human Resources planning is defined as a process of anticipation and making provision a flow of people into, within and out of an organization, the purpose is the effective deployment of Human resource through, an "Anticipating organizational labor supply and demand", and to provide expanded employment to the minorities and guide the development and formation for workforce.
I think that Human resource planning and human resource strategy are not determined by a geographic area but by the corporate strategy, so far I think that Human Resource planning follows the corporate strategy.
This is an example of strategy and human resource planning in Europe as follows:
All the companies have a vision statement of the market they belong to, of the future they planned and of their whole company and what it represents on the global, local, regional scale. As an example McDonald's and Google are both on the global scale but do not have the same vision statement. So far McDonald will focus on marketers and person who can identifies the need of the market and find what the latent desires of the targets are. Whereas Google will focus on people who can improve a global system and have strong informatics skills. (This example was made really simple in order to make the difference obvious)
Companies have different mission statement on different scale, that's why human resource planning have to be in ad equation with those, the Human Resource have to be the "shadow skill" that ensure that all the employees and departments focus on the same objectives.
A strategic directive could be going global with a South American expansion as a priority and, Human Resource will (in this case) have to plan a hiring process, a corporate mind and a corporate behaviour specific to South America
Being number one in Europe, increase market share of 3%, increase turnover, could be some corporate objective, the role of human resource in those processes, will be to maximize the productivity and help the workforce to always improve.
The corporate strategy is decided in upstream, but this is the Human Resource departments which have to follow those strategies (in terms of workforce and improvement) by managing the people and also help them in order to do the best job to set the strategy. Human resource goes out of its initial job and they became kind of a "dynamo" for the different teams; by increasing/decreasing the inner competition for example.
Based on the above example here come a personal example of what a Human resource planning could be.
Here a fictional example Human Resource planning for Orange France Télécom:
More recruitment in the East of France sales teams
Language training for sales teams in every store
Training about the new commercial period for all sales teams
Increase inner competition on Internet market
Develop sales skills through development programs
Increase customer service skills through formation programs
Develop new challenges for sales in order to well start the new commercial period
In conclusion to his part, we can observe that Human Resource will be responsible for organizational effectiveness, especially for strategic human resource planning. Human Resource planning is a supporting function to the corporate strategy and the corporate planning, it means that the corporate strategy defines what the Human Resource planning should be. Human Resources have to match with the requirements of the corporate strategy, if not, it could be a disaster with big drawbacks such a lack of skill , lack of leadership, lack of right quality people, lack of required strengths in manpower. As the result, the impact on the company will be represented by a decrease of sales and loss of profit and by this way a loss of the market share and the leadership.
Organizational Alignment & Agility in Europe
"Organizational Culture and capability (HR domain) can have as much impact on business strategy attainment, especially in areas like customer support, as does the budget (the finance domain). The challenge is to claim it, have the right conversations on these topics, and watch the impact."
Richard M. Vosburgh
Organizational alignment is the creation of some business processes and the way people work together in order to be on the same side with the organization's goals and strategies. It also deals with aligning the strategies of organizational functions with the overall strategies of the business. This goes beyond the structure of the organization.
In the business world, companies seem to value the role, presence and necessity of infrastructure when it comes to their technology, financial and other operational systems. But human resource is also a vital system, which provides support to a business. The system is at the base of all the good functioning of a company and then all the other support are directly dependant of Human Resource.
The issues are that some corporations have the drawback not to think about people as a system unto themselves, indeed they tend to put the collective or the objective in front of the individuals.
So far in order to get the best performance in terms of efficiency and effectiveness, the structure has to be set around that supports and facilitates the flow of work while connecting employees to the overall system as a whole.
The place to start is with job descriptions that clearly define roles and responsibilities. This does not mean simply putting together a laundry list of tasks, for tasks alone lack context and do not make for a sufficient job description. This is where we see most businesses fall down.
The first goal of organizational alignment is to understand how each job fits into an organization and then what are the expected results of this workforce should produce for the business in order to be as efficient as possible. Thinking in work in terms of results is more important than tasks especially in dealing with the personalities of a company, as an example a person who work 1hour to do its task should not be grounded if the required time is longer, because it depends of personality, some people work without concentration, need music, need to be casual or stress less, and others prefer pressure and respecting the process.
Human resource difficulties is not only managing the result but also checking that person feel good at work, once this comprehension done it is easier to distinguish the measurable markers associated with results.
This way, Human Resource creates the clarity necessary to give roles the appropriate meaning for employees and tie them directly to outcomes relevant to the business at the same time.
Defining a work task could be sum up at what employees need to do, but the process also explains how and especially why. Job description gives attitude and behaviour expected in a company, and the way give a "face" to the work, because people need to make accomplishment and if they do not know why, it is too abstract to obtain significant results. The way employees act is a reflection of the brand and company, which means that their reputations represent not only the internal culture, but also the company's identity in the marketplace
Another piece of the Human Resource infrastructure is the compensation, it could be seen as a viable and valuable opportunity in order to increase or decrease behaviours that help or harm the business, finally all the factors are connected (compensation, job description, evaluation, individuals performance) and are defined evaluated and rewarded on a strategic way
Workforce engagement, Capability & Capacity in Europe
In Europe, people tend to me less job oriented than In Asia for example, indeed in our area job is just a way to have a good personal life and often, people create a big board between their both lives.
The engagement toward work in Europe is strongly linked with the position of the person within the company, indeed a employee who has not a good job and not a good situation won't feel involve in the development of the company whereas an employee with a high and good hierarchical situation feels more involves because it implies more responsibility.
In fact, country has its own culture with different history and every people have different way of thinking. In this way, Hofstede and Trompenaars have measured the potential of cultural influences that is the main constraint of human resource management in its analyse of efficient adaptation. The goal is also to evaluate the cultural differences and Hofstede designed the power distance, the uncertainty avoidance, the individualism and the masculinity as the main differences between cultures.
The capability of person could not be described through the geographical aspect due to the unethical reasoning it implies, but we can check through the Hofstede theory How people tend to behave at work in a chosen country.
"Power Distance Index (PDI) that is the extent to which the less powerful members of organizations and institutions (like the family) accept and expect that power is distributed unequally
Individualism (IDV) on the one side versus its opposite, collectivism, that is the degree to which individuals are integrated into groups.
Masculinity (MAS) versus its opposite, femininity, refers to the distribution of roles between the genders which is another fundamental issue for any society to which a range of solutions are found
Uncertainty Avoidance Index (UAI) deals with a society's tolerance for uncertainty and ambiguity; it ultimately refers to man's search for Truth. It indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations "
Succession Planning in the company
Succession planning could be defined as a process to identify and develops the internal personnel who have the potential to be a key success man/woman and critical in the company positions. Succession planning is an insurance of the inner promotion and having an experienced and skill employee prepared and well train to assume the roles when it will be available.
Succession planning accelerates the transition of qualified employees from individual contributors to managers and leaders.
Succession Planning is kind of investment on the future and could take a lot of forms such as : preparing the employees to undertake they roles, finding new talents to insure long term growth, improve workforce capabilities, increase the commitment of employees, etc.
Succession planning is a necessary part of an organisation's ability to reduce risk, create a proven leadership model, smooth business continuity and improve staff morale.
In the succession planning process Human Resource has a 4 steps role:
The Goal: Matching: is to encourage employee to take their career in hands, creating mutual goal based on a planning, creates a context that encourage people to overcome their selves.
Opportunities & Requirements: is to detect potential and future competency needs, creates a career plan like a road to follow, establish dual career paths.
Career Development Initiatives: Being a counselor in career management, help people to train on their own career self management, give people some feedback (good/bad) and involves mentor to the target of the succession planning, (psychologically mentors are substitution father).
Gauge Employee Potential: Detection of competence and potential, create a "book" of available talents, use assessment centers.
The European Culture & International HR Management within Orange France Télécom
In France, we had one of the biggest Human Resources issue ever, indeed the main operator France Telecom (Orange for public) was involved in the suicide of 23 employees due to condition of work always quoted in the suicide letter, involving the pressure closer to harassment than pressure, the inconstancy in the work (the workerr were changing of job on a regular cycle) the distrust between co worker, an inner competition that impeach creation of bounds within the teams, the teams always changing.
The media involves directly Olivier Barberot, the Human Resources Manager for France telecom Orange, with firing 22Â 000 persons and muting 700 other within the last 3 years, according to him it was due to the move from a local phoning to a mobile phoning and the end of monopolistic of France telecom (but for more than 10 years now).
The change of culture of the company turned henceforth to the profitability while it still counts numerous employees in the status of state employee, and although it is still controlled by the state, leads to tensions. The transfers inside the company are many (14 000 between 2006 and 2008) and like we've seen upper the high rate of suicide lead the company to ask about the managing of human resource.
The testimonies gathered since the release of the silence of this phenomenon show a deep illness in numerous teams. After the audit sent on October 14th, 2009 to all the staff of France Télécom the consultants evoked a "tense working atmosphere, even violent ". " Felt general is very degraded, in particular as regards the working conditions, the health, the stress â€¦ ". Besides, for my own experience, I remember that sometimes I worked in a stressed environment. In fact my manager always pushed me to sell products. The most important was the turnover of our store, we had to be the first store ranked in Alsace. We were! But at which price? There is a lot of stress from manager, but also from clients who are most of them upset because something was wrong with the internet or sell phone. In the Â«wave of suicides ", they pointed "the big failure of the management". " The staffs of France Télécom seem more than ever orphan of direction and, leaders".
This case is not close nowadays, and France Telecom is currently revisiting all its Human Resources system, to my mind it is not only the Human Resources system who was wrong but also the inability of the manager of the top of the hierarchy to adapt a system created on the theory , on the practical field. There is too many pressure on the employees. Before, employees were considerate only as pieces from a puzzle, now they a considerate as human.
In the history, Human Resources used to have a very bad reputation, but nowadays it change and it is still changing, indeed, today Human Resources are not just linked with the reduction of costs and the direction of a department or a team, they are more present in terms of psychology and partnership acting like a real member of the team not only as the hierarchical person linked with the direction.
Human Resources do not go against the workforce but have to do really hard choice and sometimes it ruins their reputation.
But as we have observed in Orange, a bad management of HR could be very dangerous for the company and its salaries. That's why following the social and professional plan of HR is really needed for the safety of the company and its salaries.
The HR function continues to evolve, always in a concern of correspondence with the environment and the preoccupations of the company. It is more and more printed by an international dimension that is in its management of the employment but also in the field of the social negotiation. At the international level, the HR function is not any more quartered in the management of the restructurings and the implementation of redundancy plans. It has, on the contrary, furthermore one more a strategic role in the internationalization of the company.