Long term performance and management decision related to the Human resources

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Introduction:

Strategic human resources link the human resources with the strategic management in order to achieve the company's goals, and improve their performance. It refers the long term performance and management decision related to the Human resources of the companies. The concept of the strategic human resource management comes in 1990s, because after the industrial revolution all companies wants to use its resources in the best way and wants to maintain its competitive advantages. Human resources is an most important resource, and strategic human resources management determined that how companies can utilize its resources for the long term basis.

Sainsbury was founded in 1896 and now it is operating 872 stores comprising 537 supermarkets and 335 convenience stores. It jointly owns Sainsbury's Bank with Lloyds Banking Group and has two property joint ventures with Land Securities Group PLC and the British Land Company PLC. Sainsbury is serving over 19 million customers a week and having over 16 % market share. Sainsbury has employee 150,000 colleagues. Sainsbury financial summary of 2010 indicates that Sainsbury sales have been increased. In 2008/09 company's profit (after tax) was 289, while in 2009/10 £m it has been shifted in 585. It shows that 102.4 % £m change has been came. It means Sainsbury was successfully achieving its goal during 2010. Source: (www.j-sainsbury.co.uk)

There are five main objectives of the Sainsbury:

Firstly, Sainsbury make strategies to provide good food at good price. Because of this strategy, it enables customer transactions on average every week, a million more than last year and Sainsbury market share has been shifted from 16.1% to 16.2%

Secondly, Sainsbury is accelerating the growth of non-complementary non-foo ranges and services. Sainsbury's Bank delivered strong growth, with operating profit increasing to £19 million. Thirdly, Sainsbury is offering online shopping services to access the more customers through different channels.

Fourthly, Sainsbury is extending their supermarket and 38 new stores has been opened.

Fifthly, Sainsbury make strategies for active property management. Sainsbury market value of freehold property portfolio has increased £9.8bn. Source: (www.j-sainsbury.co.uk)

Task 1

1.1 Importance of Strategic human resources in an organization: (P1)

Strategic human recourse management is an approach to making decision on the intentions and plans of the organization concerning the employment relationship and its recruitment, training, development, performance management, reward, and employee relation policies and practices. It is an essential component of the organization's corporate or business strategy. (Michael Armstrong, 2000)

Wright and McMahan (1992) define the SHRM as a pattern of planned human resource deployments and activities intended to enable an organization to achieve its goals.

To fully exploit the wealth of knowledge contained within an organisation, it must be realized that it is in human resource management that the most significant advances will be made. As a result, the human resource department must be made a central figure in an organization's strategy to establish a knowledge basis for its operations. Without this central position any HR strategy will face the risk of failure (Mullins, L. 2005).

Strategic human resource management is very important for every organization. All organization has three type of resources, physical resource, financial resource and human resource. Human resources are most important resource because it deals with the employees of the organization. If company wants to increase its productivity, it has to focus on the employees of the company. Human resource can influence the other resources also because physical and financial resources are also maintained or controlled by the employees of the company. So human resources have great importance. Strategic human resource management deals most important part of organization like hiring, recruitment, selection of employees, training and development and retention. SHRM provides help to best meet the need of their employees while promoting company's goals. SHRM gives the framework to the companies by which it can recruit the best employee or train them and use the best abilities of the employee and got the maximum result. If company failed in implementation of SHRM, organisation cannot be survive and achieve their goals. SHRM guides how perform to maintain its competitive advantages and how to compete with competitors.

 

1.2 Strategic Human Resource Management activities in Sainsbury: (P2)

Sainsbury adopted the strategic human resource management to carried out the business into the strategic way, SHRM maintains their competitive advantages, and to deals the employees issues. Sainsbury's strategic human resource management deals with the recruitment, selection, professional training, performance of employers, career development, quality of work, attention and turn over. The main objective of the Sainsbury is to achieve their future goals, and targets. Without adoption of SHRM it is not possible. Sainsbury wants to find the best employees, who plays important role for company's target achievement. Sainsbury firstly wants to involve in the recruitment of the employees.

Recruitment:

SHRM of Sainsbury considered recruitment as a critical part of corporate strategies towards achieving long-term organizational growth. In Sainsbury recruits more than 35,000 employees every year. In Sainsbury all recruitment policies and procedures have formulated by the top level management. Management followed the traditional techniques of recruitment; Sainsbury advertised their open position or internal candidates would be given promotion. Because it's really important to recruit the skill, qualified employees, SHRM influences the productivity ratio.

Sainsbury recruited their employers through internet, online selection it saves 4 million administration cost per year. Candidates got the immediate feedback after completing its on line application. Online recruitment process takes few days rather than a week and saves the candidates times. SHRM of Sainsbury supermarket has introduced the internet access in stores for those candidates who have not internet facility because it is ensuring equal job opportunity for all.

Sainsbury's recruitment manager Jane Basley said; "We're using technology to make that nail-biting wait for news of a job a thing of the past.

"It will also enable Sainsbury's to find the right people and fill vacancies faster than ever before." Source: (www.j-sainsbury.co.uk)

Sainsbury advertise their all vacant vacancies on its official web sites. Candidates can fill the form online and also give test online. Sainsbury strategic human resource management analyse the capabilities of the candidates through different type of questions, which normally based on MCQ's. With the help of test, management decides that the candidate is suitable for the vacant post. The main objective is to find the best candidates which will be helpful for the company to achieve company future target. SHRM strategy is successfully working to find the competent employees. Some other processes are also interlinked with the recruitment such as selection and induction. Sainsbury select the person through interview. Interview is the significant technique to access the employee. During interview human resource manager also focused on the qualification and experience of the candidates.

Professional training and development:

Professional development is the skills and knowledge an employee gains to optimize their personal development and job growth. Sainsbury focuses at the development and training of the employees because employees make sure that they have the skill and confidence to do their jobs. Training develops the employees to satisfy current and future need of the Sainsbury. They are getting panties of opportunities to grow and delivering the outstanding customers services. Sainsbury train their staff how to manage and supervise their role or to deliver the required performance level. All employees should be trained to achieve the future goals of the company. Sainsbury provides on the job training to the employees. Because training are helps the employees to understand the working progress of the company and increase the productivity ratio of the employees. Sainsbury provides the comprehensive range of training and development plan to the employees. Sainsbury has their own training institutes, which was established in 1916 in Blackfriars which ensures customer that all staff is well trained and qualified.

Sainsbury strategic human resource management planed the proper policies for the career development of the employers. Sainsbury helps employees to perform their jobs efficiently, and guides the employers how to move up in the company.

In Sainsbury strategic human resource management offered different reward and benefits for the motivation of the employees. Shining stars is the incentive plan of the strategic human resource management. It is the reorganization of the fantastic work of the employee for the Sainsbury. Sainsbury awarded the voucher to recognize the employees. Annual bonus scheme has also been introduced to motivate the employees for the organization. When employees play vital role or achieved their annual target then as a result management awarded annual discretionary site/division specific bonus.

The main motive of training and the awards are to make the employees able to achieve the Sainsbury goals and to understand the personal capability of the each employee. Because some employee are more talented than others, through training they can recognize and their personal capability can use for the company's beneficial.

1.3 The Contribution of strategic human resource management to the achievement of Sainsbury's objective: (P3)

Strategic human resources management plays a vital role in the development and growth of a Sainsbury. Strategic human resources management touches the every levels and departments of the company. The involvement of Human Resource management can never be ignored or replaced. For example, within the organization the recruitment has done with the help of the Human Resource Management. If Strategic human resources management is not performing in proper way then company has to bear the expense of an untrained or not proper suitable employee. Labour unions can also create the problem for the company related to the employee's issue. Strategic human resource management makes policies to create the safe environment for employees, which effect on the productivity of organisation. . SHRM is the functional group to be responsible for the development and implementing the strategic plans. Sainsbury focuses on the development of the strategic human resource management. With these strategies, recruitment, selection, and retention of the company take place.

Task 2

2.1 Business growth of Vodafone with other mobile companies (Transactions, Merger and Acquisition), Human resource requirement in organisation: (P4 & P5)

Vodafone is the world largest mobile telecommunication company, having 85,000 employees. Vodafone has 341 million customers and operates its business in 26 countries. It was founded on in 1984 as Racal Telecom Ltd. It was the subsidiary of Racial Electronics'' Plc, which was the British radar and electronics' firm. It was founded in 1950. Its journey started towards the largest telecommunication network in 1982 when it won the bid for the private sector cellular license in UK. Vodafone made its first call is made from St Katherine's Dock in London to Newbury on 1 January 1985. Source: (online.vodafone.co.uk)

It marked the launch of the mobile industry and transformed global communications. Vodafone recognized as the world's largest mobile telecommunication network company, based on revenue, and has a market value of about £71.2 billion. Source: (online.vodafone.co.uk)

Vodafone business growth:

Vodafone corporate in 1984, but it became the independent company in September 1991 and named as Vodafone. After that Vodafone entered into various transactions to enhanced international presence. In 1999, Vodafone merge with Air Touch. In 2000, Vodafone acquisition of Mannesmann AG and became able to acquired subsidiary in Germany, and Italy. In 1999 to 2004, Vodafone acquired 97.7% stake in Japan with series of transactions. In 2007, Vodafone acquired companies with interest in Vodafone Essar for US $10.9 billion. In 2008, Vodafone has increased its stake in Arcor for €460 million. In 2010, Vodafone has 100% of Arcor. In 2009, Vodafone Verizon wireless its acquisition of Alltel Corp. for approximately US$5.9 billion (£3.9 billion).Vodafone expend different locations across the world: With the help of different transactions, Vodafone expend its business in different countries across the world. Now Vodafone is operating in Albania, Germany, Greece, Hungary, Ireland, Italy, Malta, Netherland, Czech Republic, North Cyprus, UK, Spain, Romania, Portugal, Egypt, DR Congo, Mozambique, Lesotho, India, Italy, Spain, Qatar, Ghana, Poland, South Africa, and Australia. In 2007, Bharti Airtel Limited agreed to purchase the 5.60% direct shareholding in Bharti Airtel Limited and Vodafone entered in India. In the same year, Vodafone became the second mobile operator in the Qatar with the consortium comprising with the Qatar Foundation. In 2008, Vodafone has been able to acquire the 70.0% of Ghana Telecommunication. Vodafone has also increased its stake in Polkomtel in Poland by 4.8% to 24.4% in the same year. In 2009, Vodafone has acquired the additional 15.0% stake in Vodacom for cash consideration of ZAR 20.6 billion (£1.6 billion) in South Africa. In May 2009, Vodafone has offered 40.4% share of its share capital raising QAR 3.4 billion in Qatar. In June, Vodafone merged with Hutchison 3G in Australia and formed the joint venture. In short, at the end of 2010 there are the 341 million customers of the Vodafone worldwide. Source: (online.vodafone.co.uk)

2.2 Developing a human resource plans for Vodafone. (P6, P7, P8 and P9)

"Human resource planning is the planning for the human resources. It is also called man power planning, personal planning, or employment planning. The success of organization depends upon the quality and quantity of its human resource. No organization can be successful without hiring the right number and right kind of people, during the right job, at the right time."

The purpose of Human resources planning is to recruit, retention the perfect person for the job. It makes important decision about the employee development, re-skill of employee, training of the employees.

Recruitment:

Vodafone Company has the proper human resource planning for the recruitment of the employees. Vodafone focused to recruit the most suitable persons. Vodafone has already launched the program to recruit the fresh talented graduates of the top MBA institutes. This program is working in all Vodafone operating countries. Vodafone human resource management recruits the persons in three departments as in retail stores, contract centers, head offices and support department. It is compulsory for the candidates to pass the interview. An interview has been conduct by the expertise. Some policies are varies with different locations like in United Kingdom, Vodafone recruit the person who has work permit.

Development and training:

Vodafone human resource management makes plans for the development and training of the employees. Vodafone provides opportunity to their employees to make the important decision that in which direction they want to develop. Vodafone capacity development teams help and guides about the development. Vodafone also run specialist and generalist courses, using leading-edge technical and development training facilities. Source: www.vodafone.com

Career progress:

Vodafone sheer size and diversity of the business provide the opportunities to the employees to go upwards. Every year around 1,000 people is able to get the new positions. Vodafone always encourage the employees to come up with the new ideas and new ways of doing things.

Source: (www.vodafone.com)

Human resources plans contribution:

Human resources plans contribute in the progress of the company, and move the company towards the achievement of the targets and goals. There are three main departments of the Vodafone, operational, selling and distribution, and customer care and administration. Human resource departments finalizes that person is most suitable for which department. Right person at the right place is really beneficial for the company growth. The revenue of the Vodafone is increasing that indicates company is going to the upwards. In 2009 there were 79,097 employees of the Vodafone, but in 2010 the employees has been shifted into 84,990. All employees were talented and played a vital role in the progress of Vodafone. So, HR recruitment is playing a vital role. Vodafone HR formulates the plans for the career growth. Telecommunication is a modern technology. Vodafone encourage the employee to come with new ideas and technologies. These ideas make the Vodafone more innovative and up to date. These various plans of human resources contribute in the progress of the Vodafone and leads Vodafone to meet it objectives and targets.

Human resource management policies

Human resource management policies of Vodafone formulate the policies related to the recruitment, selection, health and safety, equality and diversity, pay, rewards, benefits and rewards, training and development, work time etc.

According to the Matthew Brearley HR director of Vodafone UK:

''We measure employee engagement by standard set by local measures. We've really worked educating our managers about what it means to be a great Vodafone leader.''

Human resource management has formulated policies for the betterment of the employees. Some are the following.

The person who is not fulfilling the requirement of legal age, which is 18 years old, should not be employed as a worker .They should not be employed for this type of duty which influenced the personal development of the labors.

Any type of the threat or abuse (physical or verbal) is prohibited with the employers according to the company principles. Respect and dignity will be given to the every person. All employers have a right to join all type of the trade union with his/ her will. And freedom of expression will be provided all the employers.

All employers will enquire the equal status; no discrimination related sex or races would be acceptable in the company.

Working hours and the wages should be finalized according to national law. It should be pay fairly and timely. Source: (www.vodafone.com)

The main purpose of the policies is to provide the healthy and friendly environment to employees. These policies plays vital role in the progress of the Vodafone. When employees will be satisfied, their productivity rate will be increase. These policies also motivate the employees to achieve the targets and goals of the Vodafone.

Employment legislation, Employment Right Act:

Vodafone is protecting and enhancing the employee's rights. Vodafone sets the wages of the employees according to the law of the state. In UK, minimum wages of the employees has been fixed by the government. Vodafone regulates the minimum Wages Acts of government. Vodafone also ensures that there shouldn't be any unfair dismissal of job.

UN Universal Declaration of Human Right and International Labor Organization Core Convention:

According the UN Universal Declaration of Human Right and International Labor Organization Core Convention, Vodafone ensure the human rights of all employees. Vodafone gave the right to their employees that they can join any trade union or similar external representative organization. Vodafone also regulates the UN policies related to the child labor. Child labor is not tolerated by the Vodafone.

Vodafone has the Group Health and Safety Policy that covers health and safety management, radio frequency field, and driving safety of employees.

Sex Discrimination Act:

Vodafone HR management ensures that there is no sex discrimination on the ground of gender. Vodafone believe that men and women from different cultures will help the company to understand the requirement of customer. Vodafone also ensures at group level that recruitment consultants to recommend a minimum of one credible female candidate for interview for every vacancy we advertise at management level. At promotion time or offering any training and career development, Vodafone HRM provides the equal opportunities to the men and women employees. Vodafone ensures that men and women should receive the same salary for doing same type of job as being of same value.

Task 3

3.1 Organisational structure and culture of Nestle (P10, P11, P12)

Nestle is considered the best food company. Nestle is the fifth largest company of the world with the perspective of turn over. Nestle is working in 83 countries including Pakistan and has 522 factories around. Nestle entered in Pakistan in 1988 to acquire the 40% share of MilkPak Ltd. In 1996, Milkpak has been renamed to Nestle Milkpak Ltd. In 2005, Nestle has owned the MilkPak fully, and Nestle MilkPak again renamed to Nestle Pakistan. Today, nestle is largest food company of Pakistan.

"Organizational structure is the framework, typically hierarchical, within which an organization arranges its lines of authority and communications, and allocates rights and duties. Organizational structure determines the manner and extent to which roles, power, and responsibilities are delegated, controlled, and coordinated, and how information flows between levels of management." Source: (www.businessdictionary.com)

[Annual Report of Nestle 2010]

As diagram shown, organization structure of the Nestle International is the hierarchical. It is not very complex and complicated. Hierarchical structure of Nestle helps the management to maintain the discipline in performance. Different lines of authorizes has different duties and different task. Upper authority has a control over the low categories. In Pakistan, Nestle organizational structure is also hierarchical. Nestle organizational structure relates the all positions with one another. Management committee is answerable to the Board of Directors. Board of Directors is consisting of Chief Executive Roland Decorvet, Chairman Syed Yawar Ali, Syed Babar Ali, Syed Haider Ali, Frits Wout, Alexinder Jeans and Roger Settler.

Company Secretary of Nestle Pakistan is Raymond.

Management Committee consists of different heads of department. Uzma Butt as head of Human Resource, Zafar Hussain Shah as Head of Sales, Salman Zazir as Head of Supply Chain etc.

"Organizational culture is defined by all of the life experiences, strengths, weaknesses, education, upbringing, and so forth of the employees. While executive leaders play a large role in defining organizational culture by their actions and leadership, all employees contribute to the organizational culture." Source: (humanresources.about.com)

Nestle has been proved itself to provide the healthy, wellness and nutritious food. It has been known for the quality of food products. Nestle Pakistan has the mission to enhance the quality of life of customers, and provide the best food. To understand the cultural requirement, nestle manufacture products from different raw material. Nestle has adopted the norms and culture of the Pakistan related to the recruitment as all posts has been filled by the Pakistan except Zonal Manager and Country Head of Operation. Nestle has focused strongly on the ethics. Nestle is against any kind of fraudulence, dishonesty and corruption. Nestle provides the good atmosphere for the employees.

The effectiveness organizational culture has increased the productivity of the employees. Nestle has reduced its cost of labour by hiring the local person by HRM. Pakistanis does not alienate Nestle as the foreign company. Pakistani employees knew better about the culture and tradition of Pakistan. They can understand the requirement of the local market and can negotiate in the better way. Nestle culture based on the on the ethics and norms that provide the satisfaction to the employees. In the better work place, employees work hard to achieve the goals and targets of the Nestle Company.

3.2 Recommendation to improve the effectiveness of human resource management in an organization: (P13)

Human resource management is playing the vital role in the progress of Nestle in Pakistan. The effectiveness of the Human resource management can be increased by using the following mechanism:

Nestle HRM should have the proper management to check and measure the effectiveness of the plans and polices which has been formulated to achieve the goals of the company. Nestle should used the latest data collection techniques for this motive.

Nestle needs to improve the interaction among the different department of the company. Each department is working on individual basis. The strong and proper interaction among these departments will increase the productivity of the company and also improve the effectiveness of human resource management.

Nestle can develop the system to get the feedback of costumers through internet and questioners. According to of feedback, Nestle can check and evaluate the weakness of the employees. To analyse the weakness, HRM can provide the training and guidance related to the issues.

Nestle can also compare the growth of the company with other companies of same size in the Pakistan. Nestle can check and evaluate that its growth ratio is similar or higher than other companies or not. If the growth is lower than other, then HRM can check the productivity rate, performance of employees to understand the weakness.

Nestle can increase the effectiveness of human resource management by adopting certain points. It will help the Nestle to achieve the future goals and targets in the effective manner.

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