STRATEGIC HUMAN RESOURCE MANAGEMENT CASE STUDY

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The purpose of this report is to assess the the current resourcing strategies and practices adopted by Prentice and Page and explore the validity of IQ test for Selection process. The following would be a brief description of analyses.

Prentice and Page 's practice of using the IQ score of at least 125 which is classified as superior intelligence as the minimum basis for entry is irrelevant for a PR agency. Studies on personal success stories have found that emotional quotient (EQ) as a distinctive factor for performance and achievement that comprises self-awareness, self-regulation, motivation, empathy and social skills (Goleman, 1998a). The factor is also known as emotional intelligence and more than 75 per cent of the distinctive elements for personal achievement can be explained by EQ competencies. As a PR agency, the skills that are at most important for its employees are communication, collaboration and cooperation, and social skills and emphasis should be placed on these factors as minimum entry criteria during hiring process.

Organisations must pursue the right competitive strategy which is unique value creating strategy based on combination of internal organizational resources and capabilities that cannot be replicated by competitors. For a public relations organisation like Prentice and Page, whose main activity is relationship management; sustainable competitive advantage can be built by several ways like developing Social networks or personalized networks of influence and by using the most valuable intangible asset available to any organization that is Human resources. Management of human resources plays a critical role in determining a company's success in meeting the challenges.

Voluntary turnover which is an issue in Prentice and Page is due to job dissatisfaction created by no career development. Hence the focus should be on retaining staff by implementing strategies like continuous learning programs, career development and management programs, job flexibility and life style choices.

introduction

This report aims to resolve the issues faced by Prentice and Page and review the current resourcing strategies and practices adopted by them. The report is divided into two parts where the first part discusses the selection process in detail and the second part proposes changes in the business strategies currently pursued by Prentice and Page and also suggests a set of resourcing strategies and practices that would enable them to meet the needs of its employees and significantly reduce the staff turnover rate.

The first part initially explores the validity of IQ test by providing a two side argument looking into advantages and disadvantages of the test in Selection process and provides a recommendation for Prentice and Page.

The second part explores HR planning process and its link with business strategies. It further explores each function of HR elements of Prentice and Page in detail.

pART I

IQ TEST FOR SELECTION

Selection process (Dessler, 2009) is for hiring employees with right skills and attitudes and is important as the performance of employees affects the overall performance of the organisation and moreover selection is costly as every organisation spends time and money on recruitment, interviewing and reference checking. It is also important considering the legal implications of incompetent hiring.

Two kinds of the selection tests (Aydin et al, 2005) that are widely used in selection process of organisation are cognitive and personality tests. Cognitive tests aim at measuring the intellectual capacity of an individual. Intelligence is a composition of various mental functions like perceiving, memorizing, thinking, learning and ability of reasoning. The level of intelligence can be measured by testing mathematical and logical abilities, and verbal capacity and any tests that measure these abilities in an individual are called IQ (Intelligent Quotient) test. An individual's cognitive ability is determined by the score obtained in the IQ test and Wechsler has classified it into six items which are based on the Probable Error (PE) as shown below.

Advantages of IQ test for Selection:

The advantages of using IQ tests for selection are

IQ tests determine an individual's Mathematical and verbal abilities.

IQ tests measures cognitive abilities of technical ability.

An individual's IQ level is his ability for learning, comprehension, problem-solving, and decision-making.

Elements in IQ test constitute the basic level competencies for performance.

Disadvantages of IQ test for Selection:

The disadvantages of using IQ tests for selection are

IQ tests fail to find an individual's capacity to manage interpersonal relationships.

IQ tests have no correlation with employee performance.

IQ tests are not designed to measure an individual's self awareness, self regulation, motivation, empathy and social skills.

IQ tests are not designed to measure emotional abilities such as entrepreneurship, competitiveness, risk taking, resistance to stress and perseverance.

Discussion:

Prentice and Page is a public relation agency whose main area of expertise is establishing and promoting favourable relationship between client and public, and create, maintain, and protect the client's reputation and enhance its prestige. Such an organisation whose main functions are employee relations, stock holder relations, and community relations requires employees (Aydin et al, 2005) with exceptional intrapersonal and interpersonal intelligence but the main emphasis in selection criteria by Prentice and Page is on IQ test which cannot determines these elements in an individual.

For example, a study conducted by Harvard University graduates (Goleman, 1998a) in the field of business found that employees who were hired during the selection process with identical skills and almost the same levels of IQ showed different levels of career development, achievement and performance during their career paths. So there must be another factor that is different from IQ that creates outstanding performance which can be explained by a study on engineers which demonstrated that self confidence, flexibility, the inner discipline to strive for challenging goals, the ability to collaborate as a part of a team, the ability to influence and persuade others are the principal elements in explaining differences between ordinary and significant achievement (Goleman, 1999, p. 167). These studies show that there is no significant correlation between the indicators of technical knowledge, a surrogate of IQ, and career achievements (Goleman. 1999, p. 167). Therefore, IQ is insufficient to explain achievement, even in technical and complex jobs that require a high level of IQ linked with technical expertise (Smigla and Pastoria, 2000). IQ tests cannot differentiate between outstanding performer and ordinary performer as both have similar technical strengths.

Conclusion:

Prentice and Page 's practice of using the IQ score of at least 125 which is classified as superior intelligence as the minimum basis for entry is irrelevant for a PR agency and is necessary only for technical jobs involving software production and data processing. IQ tests are not designed to measure emotional abilities such as competitiveness, perseverance, risk taking, resistance to stress and entrepreneurship which are determinative than technical intelligence of achievement in the business. Studies on personal success stories have found that emotional quotient (EQ) as a distinctive factor for performance and achievement that comprises self-awareness, self-regulation, motivation, empathy and social skills (Goleman, 1998a). The factor is also known as emotional intelligence.

Cherniss and Adler (2000) argue that more than 75 per cent of the distinctive elements for personal achievement are EQ competencies. Achievement at the workplace can be described as a function of the various skills that are derivatives of intelligence. Goleman's (1998a) has proposed a model that adopts job skills approach in the sense that it assumes two different types of job intelligences. In this model, the first category of intelligence forms the threshold abilities that people need in order to get the job done which are the minimal skills needed to carry out the tasks associated with a given position, and can be seen as IQ competencies since they require the use of analytical, conceptual and technical capabilities of an individual. The second category of intelligence comprises the distinguishing abilities like influence and persuasion, perseverance, self-confidence which is the one that sets superior performers apart from average ones and EQ abilities largely contain these competencies. It is assumed that analytical-technical intelligence (IQ) is indispensable for achievement but significant achievement depends on the acquisition of EQ elements in addition to IQ abilities. A study by Aydin et al (2005) showed that superior performance requires both high IQ and EQ scores, as there is a significant and strong correlation between the two. Therefore, IQ and EQ elements are complementary to each other for significant achievement in work settings.

Recommendation:

Prentice and Page should continue to utilize IQ tests, since IQ elements constitute the basic level competencies for performance but minimum score of 125 should not be used as the basis for entry and EQ elements should be included in the selection tools and techniques in varying degrees according to the specific requirements of the job position. As a PR agency, the skills that are at most important for its employees are communication, collaboration and cooperation, and social skills and emphasis should be placed on these factors as minimum entry criteria during hiring process.

PART II:

Business Strategy:

To be successful today, every organisation company must be competitor-oriented. Organisations must pursue the right competitive strategy - avoid strengths of competitors and look for weak points in their positions and then launch marketing attacks against those weak points. Pursuing right competitive strategy (Porter, 1980) helps in building a sustainable competitive advantage which is a prolonged benefit for an organisation which is based on unique value creating strategy based on unique combination of internal organizational resources and capabilities that cannot be replicated by competitors. Such unique and distinctive capabilities are always a result of intangibles assets like Brand name, Tacit knowledge, Organizational culture, Business processes and Team work.

For a public relations organisation like Prentice and Page, whose main activity is relationship management; sustainable competitive advantage can be built by several ways. Social networks or personalized networks of influence are considered as the one of the important strategic resources for PR activities. A study by Shin and Cameron (2003) have proved the importance for PR practitioners of holding powerful and influential networks of influence in order to be able to achieve their goals. A network is considered influential when it helps to open "gates" for public relations practitioners, like for example publishing a news story or approving a government license (Sriramesh, 2008, p. 414) as main functions of PR agencies is management of communication between organisation and public. In order to possess influential networks, PR practitioners need to establish trustworthy and strong personal relationships with different influential groups and building influential networks is a personal rather than an organizational prerogative, since influential networks are determined by face-to-face and trustworthy relationships. It cannot purely be acquired by working for an organization as an employee. An Influential and powerful network is a personal skill that top communicators are expected to have in the field of PR.

Social capital is the potential resource which is linked to possession of a durable network of more or less institutionalized relationships of mutual acquaintance and recognition. Valentini (2010) sees social capital as having two components: first, the size of the network and second the volume of the capital that the other components of the network have, and to which a person obtains access through the network. Social capital is seen as a result of a conscious or unconscious investment strategy involving exchanges of time, attention, and concern. The results of the study by Valentini (2010) were

It is more important for public relations practitioners to establish trustworthy relationships with journalist.

The importance of having personalized networks of influence for professional activities will be greater for practitioners than media professionals so PR practitioners should have exceptional social skills.

A sustainable competitive advantage can be also built by using the most valuable intangible asset available to any organization that is Human resources. Management of human resources plays a critical role (De Cieri et al, 2008) in determining a company's success in meeting the challenges. Compensation, staffing, training and development, performance management and other HRM practices directly affect employee motivation and ability to provide product and services which are valued by customers. HRM practices that help companies deal with competitive challenges can be grouped into four dimensions which are

Managing human resource environment.

Building human resource system.

Developing human resources and

Rewarding human resources.

Resourcing Strategies and Staff Retention:

Human resource planning (De Cieri et al, 2008) is the process through which organisation goals are translated into human resource goals regarding staff levels and allocation. Planning involves forecasting human resource needs for an organisation and steps to meet these needs. This process consists of developing and implanting plans and programs to ensure right number of employees with appropriate skills is available at right time and place, HR planning is a very important contributor to organizational strategic plans when developed for a long term. HR planning process consists of number of stages which include forecasting, determining labour demand, determining labour supply, determining labour surplus or shortage, goal setting and strategic planning, program implementation and evaluation.

Prentice and Page should plan its human resources based on its goals and should also forecast the future staffing needs and should recruit people with right skills at the right time. As already analyzed in part I of this report, it should change its selection criteria and now the emphasis should to select individuals with high EQ and basic IQ skills.

The Staffing needs should be analysed by linking them to organisation's overall objectives and mainly aiming at organisation's strategic goals. Prentice and Page should make a staffing table to forecast staffing needs which will have detailed description of jobs in the organisation, their occupants, reporting relationships and lines of authority and will have information about probable succession. This will give organisation information about staff that is ready for promotion and also which employee will require training. Staffing table will also have information of staff that is due to retire or staff who will be away for a period year.

Prentice and Page should recognise that to gain competitive advantage, training has to involve more than only basic skill development. Primary focus should be teaching employee with communication, social skills and advance skills like new changes in technology while sharing information with other employees and self motivated creativity which are of prime importance for employee of PR agency. It should also leverage on continuous learning which will help employees to understand the organisation as whole.

Employee development is an important step at Prentice and Page as it mirrors the company's effort to improve its quality to meet challenges of global competition and appreciate staff by preparing them to managerial positions. The employee development at prentice and page should mainly focus on approaches like formal education, assessment, job skills, interpersonal skills, behaviours which are strengthened by each development method and this will enable employees to meet the changing job requirements and customer demands. The changes can occur in various forms like new technology, work designs, new customers and new product markets.

Prentice and Page should recognise the strategic value of implementing career management systems by enabling employees to progress through a sequence of positions by developing their knowledge skills and abilities. Thus Career management not only contribute employees but it directly links the organisation's goal and individual smart goals.

Voluntary turnover which is an issue in Prentice and Page is due to job dissatisfaction created by no career development. Hence the focus should be on retaining staff by

Implementing strategies explained above like continuous learning programs, career development and management programs, job flexibility and life style choices.

Communicate effectively and provide clear understanding of their strategic vision and goals.

Maintaining ongoing and regular communication with employees to address workplace issues.

Demonstrating ethical behaviour in managing staff which will be sustainable and socially responsible.

Understanding and managing the diversity of workforce.

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