A corporate strategy is the one which represents the overall vision and the mission of an organisation. Many companies fail to focus on this and all they focus is on the producing the goods and services hoping it satisfies the needs and wants of the customer which is also important but is not everything an organisation does.
Let's start up with the purpose of the assignment, the reason for this research is to evaluate the linkage of a company's human resource's strategy and the corporate strategy. Now by the corporate strategy here we mean is the overall vision set by the organisation. This statement can be justified by many authors and is the actual fact that everyone in the organisation should know.
The reason is that the organisations fail mostly is, they are not able to establish an effectual strategy (Verena, V 2006) of their functional areas such as the human resources, marketing, finance etc. The assignment is focusing mainly with the human resources and it's planning and the corporate strategy.
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"Corporate strategy concerns two different questions: what business the corporation should be in and how the corporate office should manage the array of the business units." (Porter, M. 1990)
The above definition reveals two aspects that first every organisation should know the industry it is dealing. Second, the range of business units a company deals in. Now it is obvious that the corporate strategy cannot be fulfilled without the proper involvement of the human resources in other words the employees to extract the best possible outcome (Rowe, A. 2006). Thus the concept of aligning the human resources strategy could be extracted by this notion.
Therefore, this assignment evaluates the strategies laid by Singapore Airlines in order to achieve the overall corporate strategy of the organisation. The essence of this research is the critical factor which would have made the managing of the employees even better based on the literature used in the assessment.
THE CORPORATE STRATEGY AND OBJECTIVES OF SINGAPORE AIRLINES
Singapore Airlines is a diversified company dealing in various related businesses owning according to an article written by Heracleous, L., Wirtz, J., namely:
Singapore Airport Terminal (80.8%)
Singapore Engineering Company (81%)
Singapore Airlines Cargo (100%)
Silk Air (100%)
Tiger Airways (49%)
Virgin Atlantic (49%)
Given that the company deals in diversified businesses Singapore Airlines at its corporate level follows the strategy of related diversification. A related diversification strategy is in which:
"...an organisation operates in several businesses that are somehow linked to one another" (Ricky, W. Griffin 2007)
According to Ricky, W. Griffin there are three basic benefits of using such a strategy which are:
The organisations that use such a strategy do not depend on any one business reducing the financial threats.
They reduce the operating expenditures i.e. the costs are divided by the number of businesses.
There is a synergistic approach of enjoying the strengths and capability through a number of businesses it operates in.
According to an article written by Jochen W, Loizos H, and Nitin P, the objectives of Singapore Airlines were to:
Provide a superior customer satisfaction that will be consistent and reasonably priced.
A pleasant ROI to the shareholders and generating adequate earnings to afford an ample support for investments.
Develop the best Human Resources practices that draw, grow, motivate and retain the workforce which play a role in achieving the firm's objectives.
Maximise the capacity of operations and use all the available resources.
With the above referred strategy and objectives of Singapore Airlines through the authenticated sources it is clear that the firm from it's very founding has a concept of managing its' employees (cost effectiveness) in such a way that it delivers and sustains an excellent service.
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A CRITICAL EVALUATION OF HUMAN RESOURCES STRATEGIES IN CONTEXT TO SINGAPORE AIRLINES
Knowing that Singapore Airlines has a corporate strategy that is related differentiated one and the objective of the firm is to achieve leadership for in an excellent service which means the vision of the Singapore Airlines is to stay ahead of the competitors. Now by this it also evaluated that it is an airline industry which is a service based industry.
Always on Time
Marked to Standard
A logical notion to get from the objectives set by Singapore Airlines is that it has to focus on using the resources in such a way that it turns out to be in excellence and the need of best people with best performance through their skills. In a scenario of such a kind this assignment takes a critical review of the strategies laid by the company with the help of available literature on how can a firm make the best performance deploying and redeploying the human resources and the human resources strategies used by Singapore Airlines. These strategies can be extracted by the help of the diagram given below which is followed by the explanation of each of the strategy.
RECRUITMENT AND SELECTION
"Moreover, "the people recruited" in an enterprise or an organization creates the business culture which can highlight enterprises' positions and make them different from competitors." (Vinet, N. 2010)
The definition give by Vinet draws an important that the recruitment strategy should be done with the alignment of the desired objective of an organisation as it is the people in the organisation who deal who represent the enterprise by creating a culture and that differentiates the organisations from the rivals.
A research conducted by Jochen W, Loizos H, and Nitin P Singapore Airlines is the one which is much concern of this matter as they lay a thorough strategy in the recruitment process and a strict process of selecting the employees. The process of recruiting and selection of employees goes through the following stages as evaluated from the research:
Baseline recruitment and Screening: at the very first step from a range of applicants the screening of the applicants is made on the bases of their age ranges, academic qualifications and physical attributes.
Interviews: the applicants which are successful in the screening are further take three rounds of interviews.
Uniform trial: the applicants after the interview stages have to go through the trial of their appearances in the uniform.
Water tests: a confidence level testing is done of the applicants' i.e. they are made to jump in water from a height of three metres, this gives the view to the interviewer what the reaction of them will be if such a situation comes up where they have to escort the passengers in the water.
Psychometric test: the psychological tests are then conduct to judge the intelligence, attitudes, aptitudes and personalities of the applicants.
After the recruitment is made the successful applicants are further monitored on a six month trial and then contracted for five years if successful. This process of selecting is a most strict process by which Singapore Airlines ensures that they recruit the people with right skills attributes the company desires to have to achieve the set objectives.
TRAINING AND DEVELOPMENT
An article Greg Procknow gives five important reasons as to why training is necessary in an organisation:
Training contributes to the overall strategy.
Ensures the quality out of the employees through the training and development.
Ensuring the security and safety is kept among the employees as well as the customers
Attracting the skilled people and retain the existing ones.
Non-financial rewards for the employees for example: promotions.
Singapore Airlines has a good match given above such that it does believe that training is pool that links itself with the employees. It does have a good emphasis on the training on the employees focusing on the point that being a service based organisation the employees the only means by which it can achieve its strategic objectives and stick to the corporate strategy.
Thus a research conducted by Jochen W, Loizos H, and Nitin P, Singapore Airlines group has seven training schools for the seven principal positions of operations and service conveyance:
Airport services training and engineering
Further the training courses are conducted on a four and twenty nine months for the existing employees to help them know and follow what the organisation expects from them.
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Singapore Airlines follows holistic strategy in developing the human resources which is not just concerned with the health and safety issues but also on the functional issues and beauty care, high-quality and exotic food and wine, art of conversation.
The firm has a Management Development Centre (MDC) also offers general management training under the purview of the HR division.
SERVICE DELIVERY TEAMS
According to Jochen W, Loizos H, and Nitin P, the emphasis is laid in order to extract a high value of performance from the employees through performance appraisals. Through the performance appraisals the company is making the teams effective in performing. The performance is evaluated and assured through the following:
The leaders or the company monitor the staff developments
The Staff performances are evaluated and communicated to them through appraisals.
The staffs are supervised periodically.
Feedbacks are taken also from the monitored.
An improved monitoring is done basing on the employees feedback.
As a result of such a performance appraisal Singapore Airlines are successful in achieving a high performance resulting a to an effective delivery team.
QUALITY STAFF CONTROL
The staff control strategy is laid especially with the frontline cabin crew such that the corporate strategy and the organisational goals are communicated to the staff. They are made clear that their role is they do not have a vision of becoming the world's largest airline but be a cost leader in the industry. Therefore, the quality is to maintained and is not optional, this ensured by ensuring they hire people with the same quality through a series of assessments made in the recruitment process (psychometric tests, water tests, tea party test, etc.).
The ultimate competitors to Singapore Airlines are Air France-KLM Group, British Airways and the Lufthansa Airlines. The quality of the staff and their services are controls in order to stay ahead of these rivals in terms of cost leadership.
MOTIVATION AND REWARD
To expect the best out of the employee they have to be motivated through a reward system (Makenan, I. 2008). This should b e truly based on their performance which denotes 'well done good job' as every employee expects this from this appreciation from the managers, leaders and the organisation.
According to the article written by Jochen W, Loizos H, and Nitin P, Singapore Airlines uses both financial and non-financial rewards in order to the recognition of the employees which can be seen below as follows:
Photographs and names of the good employees in the newsletters which is a form of recognition.
Annual Deputy Chairman's Award
A significant percentage of variable pay components linked to individual staff contributions and company's financial performance.
The above rewards used by Singapore Airlines works as a good factor to maximise the contribution and skills of people who are selected thoroughly through the rigid recruitment and selection process.
All the above strategies laid by the organisation are successful ones which help the organisation to maintain the corporate strategy and achieve the corporate objectives so far by knowing it has been doing well.
CRITICAL ASPECTS OF THE HUMAN RESOURCE STRATEGIES IN CONTEXT TO SINGAPORE AIRLINES
Although the organistion is doing very well in terms of managing the human resources and has been very effective also the firm has made an attempt to retain the skills in the organisation. An emphasis has also made to do so as according to the research made by Jochen W, Loizos H, and Nitin P, shows that the organisation maintains a management development centre which focuses on develops the employees and helps in retaining them by dividing the development programmes into 3 parts as:
programmes the focus on the varying priorities and required skill at different managerial hierarchical stages;
Encouragement programmes to develop the managerial skills;
Programmes that focus in the areas of social protocols and couching which in turn help in self-development.
But still the organisation is having a 10% labour turnover every year which may be due to the reason that the employees are not well motivated or recognised.
The findings from the assessment made on the basis of the assignment title gives a view point that the firm has a retention on the list and making an indirect attempt to sustain the workforce, but there stands a need for a direct retention strategy which should be focused as the opposite can result in the following:
Too much cost of recruiting people as it is already going through a lengthy process in the search of the right skill.
Too much of time consumed also in the recruitment and selection procedure.
New staff takes time or finds it difficult to adjust in the culture and environment.
The skilled workforce joins the competitors which is a winning point given to the rivals.
In order to overcome the people leaving the organisation a range of strategies can be laid.
Strategies to stop the labour turnover
Implementing of motivation theory given by Fredrick Herzberg which divides people in the organisation into two parts which given below in the model.
Although the organisation is motivating the employees through rewards but there should be a proper classification of both the parties to emphasize on and development plans should be laid in accordance.
Create communities among the employees which in turn build up a social network. People do not leave the organisation as leaving the organisation would be leaving their networks. (Torrington D., Hall L., Taylor S. 2005)
Implementation of grievance management could also reduce the resigning of employees as it makes them feel they have an option if they are not satisfied by their superior. Singapore Airlines should have a procedure for identifying such grievances. They can be identified by the following:
Source: Lecture notes
Exit interview, these are done with the employees who are leaving the organisation, and are helpful in retaining the employee by offerings and also getting the feedbacks from them which can be incorporated in the organisation.
Gripe Boxes: these are the boxes in which the employees put their grievances and their critics to any superior. They differ from the suggestion boxes as the people do not specify who they are.
Opinion Survey: A form of self evaluation of the grievances by the organisation and a good way to maintain employee relationship and expect maximum contribution from the workforce.
Open-door Policy: A policy which is spoken of many times in an organisation and is very less in action. This policy is the one where any employee or the manager is free to approach a superior to report his or her grievance.
Singapore Airlines does not have an emphasis on the concept of knowledge sharing among the employees. A knowledge that is seemed to be preserved within the people but should be among the people as sharing of knowledge tends to enhance when the ideas shared and this is done in a collaborative manner. (Lecture resources)
Strategies to encourage knowledge sharing in an organisation:
The process can be divided into people itself with specific responsibility to do so. As shown in the diagram below: Source: Lecture notes.
The knowledge architects: Chief Knowledge Officer and involve, among other things, who emphasize on how the knowledge can be shared and how people will be trained, how they will be rewarded for collaborative working.
The knowledge facilitators: consists of people who run processes to help knowledge flow, for example company journalists who write up customer case studies and project reviews; librarians who develop the storage and retrieval of information; information service providers who provide an internal consultancy service to find and deliver information to staff; webmasters who develop the company intranet.
The knowledge aware: Consists of employees, who have a responsibility in sharing their expertise and knowledge and participate in value of collaboration.
CONCLUSION AND RECOMMENDATION
The research in this assignment was made on Singapore Airlines as it is a service based organisation and deals in a service industry and the human resource factor is much more critical here as they represent the organistion. It is their service which derives the competitive advantage for the organisation.
Singapore Airlines Emphasize on a dual strategy i.e. cost leadership and differentiation. The human resources strategy has been well aligned so far to sustain the competitive advantage as the research shows that Singapore is not a budgetary airline but still is offering the price of a budgetary airline.
As this assessment is based on the research made on the journal The Role of Human Resources in Achieving Service Excellence and Cost Effectiveness at Singapore Airlines by Jochen Wirtz, Loizos Heracleous and Nitin Pangarkar in 2007, the journal reveals five strategies laid by Singapore airlines in order to align the human resources strategy to the corporate strategy and objectives through maximisation of skills and contribution of the people.
At the end of the evaluation and the elaboration of these strategies a viewpoint was clear that the organisation although has a stiff and strict procedure of recruiting and selecting the people but which obviously for no doubt has to be so lengthy and also costly. This factor could be reduced by reducing the labour turnover. They necessity is due to a reason that when the economy is down the turnover is what it is at the moment (10%), but if the economy is on the peak this percentage can also go at the peak.
Thus the organisation should be focusing on two main factors given already recommended in the above section that is:
Retention strategy to sustain the skill in the organistion and know why they leave the company. (Torrington D., Hall L., Taylor S. 2005)
Build or create knowledge sharing environment in the company so that even if the people leave the organisation there tacit skill remains explicit. The reason is that new staff take time to adjust in the culture and to be trained to give the same performance of the former employees