The company has its strengths, weaknesses, opportunities and threats. NSC should build upon its strengths, and attempts to address its weaknesses to strengthen the company in areas that it has performed poorly. The company also needs to exploit opportunities and tackle threats facing it.
Neardunn Sports Cars (NSC) is still adopting a hierarchical structure, for which it is recommended that it needs to adopt a multidivisional structure to better suit its operations and increased its performance and productivity.
NSC has a unique culture of its own, such as not having a mission statement, a rulebook or any written policies, an organisation chart, a human resources department or even a headquarters. Only short-term strategies are adopted.
With regard to change, the company has experienced two kinds of change, a major organisational change which took twenty years to realise. The big changes were driven by crisis such as financial hard times or Semler's stress-related illness.
Performance of both management and employees have developed in recent years which has contributed to the company's success. NSC encourages its employees to consider starting up satellite supply companies and subcontracting for NSC.
NSC have addressed the issue of female employment, by introducing 'The NSC Woman Programmes', which are run by women which seek to reduce this discrimination.
NSC does not offer formal training programmes, but responds in various ways when employees ask for a chance to develop new skills; however, it does not have any development programmes. However, it is recommended that it should offer formal training and development programmes to their employees to help them develop their career.
1.1 Human Resource Management
Human resource management is defined as: "That part of the management process that specializes in the management of people in work organizations. HRM emphasizes that employees are critical to achieving sustainable competitive advantage, that human resources practices need to be integrated with the corporate strategy, and that human resource specialists help organizational controllers to meet both efficiency and equity objectives" (Bartton and Gold, 1999: 11). These authors add that this broad definition would be incomplete without further explaining what terms as such 'human resources' and 'management' mean. People in a working organisation influence productivity, quality and profitability due to their endowment with a range of abilities, talents and attitudes. People are said to set overall strategies and goals, design work systems, produce goods and services, monitor quality, allocate financial resources, and market the products and services. Accordingly, individuals become 'human resources' by virtue of the roles they assume in their organisations. Bratton and Gold (1999) add that employment roles are defined and described in a manner that is designed to maximise particular employee's contributions towards the achievement of the organisational objectives.
Mullins (2005: 190) maintains that management, at its most basic, may be perceived as 'making things happen':
"Management is active, not theoretical. It is about changing behaviour and making things happen. It is about developing people, working with them, reaching objectives and achieving results. Indeed, all the research into how managers spend their time reveals that they are creatures of the moment, perpetually immersed in the nitty-gritty of making things happen" (Crainer, 1998: xi).
The most sensible way to realise what management is, is to realise that management is both an art and a science, and at the same time, it is involved in both political behaviour and control. There are four perspectives on management (adopted from Watson, 1986):
Management as Science: Successful managers are those who have learned the appropriate body of knowledge and skills.
Management as Art: Successful managers are those born with appropriate traits.
Management as Politics: Successful managers are those who can work out the unwritten laws of life in the organisation.
Management as Control: Successful managers are those who can exploit and control workers.
The overall purpose of human resource management is to "ensure that the organization is able to achieve success through people" (Armstrong, 1999: 4). It has two main concerns, namely, concern for people and concern for performance. Concern for people means: "attracting, retaining, developing and motivating the right sort of employees and helping to develop an appropriate culture and climate" (Armstrong, 1999). However, this concern is also to be focused on the needs of the people themselves in addition to focusing on the business needs of people. Concern for people implies an ethical approach to their management. Winstansley and Stuart-Smith (1996) suggest four ethical principles: respect for the individual, namely, giving people a 'voice'; mutual respect, that is, establishing communities of interest in organisations and reconciling conflicts arising from poor communications; procedural fairness, that is covering all aspects of the ways in which people are treated; and transparency, that is, opening up and explaining management's proposal, decisions and procedures.
Armstrong (1999) also summed up the characteristics of human resource management, indicating that it focuses on: strategic fit (integration), that is, the need to integrate business and human resource strategies, a theme which is very important and relevant to the topic of this assignment; coherence; commitment, treating people as assets or human capital to be invested in thorough training, which involves aligning skills to organisational needs and 'knowledge management', also another important and relevant topic of this assignment; corporate culture; unitary employee relations, that is, the adoption of a unitarist rather than pluralist approach with the emphasis of individual contracts rather than collective agreements. A unitarist approach is based on the belief that people in an organisation share the same goals and work as members of one team, whereas the pluraist approach realises that the interest of employees will not necessarily coincide with their employers. This is a further important and relevant theme to the present assignment; and management responsibility, that is, the belief that human resource management is an activity driven by top management and that the performance and delivery of human resource management is the business of line managers.
The key activities of human research management undertaken by line managers and human resource professionals are: organisation, including organisation design, job design and role building, and organisational development; the employment relationship; resourcing, including human resource planning, and recruitment and selection; performance management; human resource development, including job evaluation, pay, paying for contribution, non-financial rewards, and employee benefits; employee relations, including industrial relations, employee involvement and participation, and communication; health, safety and employee services; and employment and human resource administration, including employment practices and procedures, and human resource information system (see Armstrong, 1999: 12-14). Bratton and Gold (1999: 14), on the other hand, define human resource management as a "body of knowledge and a set of practices that define the nature of work and regulate the employment relations." They report that human resource management covers five functional areas: staffing, rewards, employee development, employee maintenance, and employee relations.
2. SWOT Analysis
SWOT analysis is a tool for auditing an organisation and its environment. It is the first stage of planning and helps marketers to focus on key issues. Once key issues have been identified, they feed into marketing objectives. The SWOT analysis is an "evaluation os an organization's strengths and weaknesses un relation to environmental opportunities and threats" (Thompson with Martin, 2005: 194). What the SWOT process is seeking to accomplish is an overlap between the business environment and the organisation's resources, that is, a match between the organisations' strategic or core competencies and a market opportunity (Burns, 2001). It can be used in conjunction with other tools for audit and analysis, such as PEST analysis and Porter's Five-Forces analysis. Below is NSC's SWOT analysis:
It can be said that NSC:
has empowered its employees with more control over their jobs, for example, they vote on their bosses, to declare strike, audit the books, and question all aspects of management;
has changed its hierarchical organisational structure for a more fluid concentric circular structure, though in some areas its retains its bureaucratic structure;
claims that it does not tolerate dishonesty;
can be described as democratic, having representative democracy throughout its factory committees.
adopted open plan office design to break down barriers and allow people to mingle and even intentionally mixing departments, and its managers wonder around; and
does not use formal organisational chart.
Factory and office workers are free to work on flexible basis. Though this is an important practice, it is, on the other hand, potentially disrupting since each floor worker depends a great deal on his/her team-mates. Nonetheless, the situation has been dealt with by the organisation's people always having subordinated individual preference to group schedules;
open plan office design has its advantages. However, it also a disadvantage, or a weakness, since employees might view it as placing under constant surveillance by the management or their bosses; and
bureaucratic structures are being retained, since many positions carry with them hierarchical authority.
Eliminating waste, using simple one-page memo papers, and getting rid of scrap and old machinery are all opportunities for cutting costs;
clustering production machines, rather than adopting assembly line presents the opportunity for teams assembling a complete product rather than isolated parts; and
the opportunity of investing new products, refine old ones, devising market strategies, etc. are excellent opportunities for diversification of products, innovation and getting a larger market share; hence realising higher profits.
Threat of entry into the market of a competitor, especially from overseas;
recession of economy;
Possible strikes by temployees which may jeoperdise production and negatively affect supply to meet market demand; hence leading to lower production and loss of confidence by customers, as well as suppliers;
financial problems due to possible strikes, due to loss of sales and supplies; and
rising production costs due to expensive raw materials may lead to higher prices and inability to have a competitive advantage against its competitors.
3. Structure and Culture
3.1 Organisational Structure
Managers often describe their organisations by drawing an organisation chart which maps out its formal structure. These structural charts, according to Johnson, Scholes, and Whittington (2005: 397-398), "define the 'levels' and roles in an organisation. They are important to managers not just because they describe who is responsible for what." Different authors have reported different types of organisational structures; for the purposes of this report, some of these structures are described.
3.1.1 Small Organisation Structure. This structure consists of the owner/proprietor and the immediate small team surrounding that person (Lynch, 2006: 590). Entrepreneurial structure is an example of small organisation structure (see Figure 1). The organisation is characterised by limited resources, individual need to be flexible and assume a diversity of tasks, and the informality of the structure allows fast response to market opportunities and customer service requirements (Lynch, 2006). Nonetheless, there might be problems caused by the duplication of roles, confusion of responsibilities and muddled decision making, and it may be unrealistic to draw up clear organisation structure. An entrepreneurial firm is an example of small organisation structure, as illustrated in Figure 1.
(Thompson with martin, 2005: 701).
Functional Organisation. This structure is based upon locating the structure around the main activities that have to be undertaken by the organisation, such as production, marketing, human resources, research and development, finance and accounting (Lynch, 2006: 590) (see Figure 2). The functional structure is often the first structure adopted as the organisation grows from being a small firm. This structure has some advantages, such as having simple and clear responsibilities, central strategic control and functional status recognised. Advantages are the following: co-ordination is difficult; emphasis on parochial functional areas in strategy development rather than company-wide view; encourages interfunctional rivalry; and strategic change may be slow.
The functional organisation structure
(Lynch, 2006: 590).
3.1.3 Multidivsional Structure. This is "structured around separate divisions formed on the basis of products, markets or geographical areas" (Lynch, 2006: 591).
As organisations grow, they may need to subdivide their activities so as to deal with the great diversity which can arise in products, geographical or other aspects of the business (see Figure 3). The advantages of this structure are that it focuses on business area, eases functional co-ordination problems, allows measurement of divisional performance, and can train future senior managers. However, it has certain limitations, or disadvantages: expensive duplication of functions, divisions may compete against each other, decreased interchange between functional specialists, and problems over relationship with central services (Lynch, 2006: 591)
3.1.4 Holding or Corporate Company Structure. A holding company is that which "owns various individual businesses and acts as an investment company with shareholdings in each of the individual enterprises" (Lynch, 2005: 591) (see Figure 4). The holding company strategy is often referred to as a corporate strategy across the range of individual enterprises (Lynch, 2005: 592). Advantages are that it allows for the complexity of modern ownership, taps exercise and gains new co-operations, new market entry enhanced, and spread risk for conglomerate. Disadvantages are that there is little control at centre, little group contribution beyond 'shareholding/banking' role, problems if two partners cannot co-operate or one partner loses interest, and may have very limited synergy or economies of scale (Lynch, 2006: 592).
The multidivisional organisation structure
(adopted from Lynch, 2006: 591)
The holding company organisation structure
(Lynch 2006: 592)
Matrix Structure. "A matrix organisation is a combination of two forms of organisation - such as product and geographical structures - that operate jointly on all major decisions" (Lynch, 2006: 592). Lynch (2006) also indicates that in some cases, it may be advantageous for a large enterprise to organise for its separate divisions or product groups to co-operate on business strategy with another method of organising the enterprise, often a geographical one (see Figure 5). Advantages include: close co-ordination where decisions may conflict, adapts to specific strategic situations, bureaucracy replaced by direct discussion, and increased managerial involvement. Disadvantages: complex, slow decision making: needs agreement by all participants, unclear definition of responsibilities, and can produce high tension between those involved if teamwork of some parts are poor (Lynch, 2006: 593).
Chief Executive Officer
Product group 1
Product group 2
Product group 3
decided in each of
the matrix groups
and perhaps at the
The Matrix organisation structure
(Lynch, 2006: 593).
3.1.6 Hierarchical Structure. This structure focuses on the distribution of power and responsibility (Figure 6). The whole enterprise is divided into a number of functional departments. The work of these departments and co-ordination of information flow among departments is managed by several factors (Schofield, 2001): rules and procedures to ensure predictability; specialisation and division of labour; a hierarchical chain of command; selection to posts on the basis of competence; separation of ownership and administration; and written documentation of procedures, decisions and rules.
Advantages include: operational processes become more predictable and consistent, with procedure and committee replacing individual judgement, since the career routes are clear in bureaucracies employees feel safe, and tend to be easier to achieve the goal effectively. Disadvantages include: rules are inflexible instruments of administration which enshrine experience of the past rather than present conditions, which cannot satisfy individual needs, and tends to confuse the innovation demand.
The bureaucratic organisation structure
(HRM Module 2006 to 2007 - Session 2, p. 13)/
3.2 Recommendations about the Structure of the Organisation
It is recommended that NSC do with its bureaucratic form of organisation in favour of replacing it with the multidivisional structure. This is due to the fact that this structure, as indicated above, focuses on business areas, eases functional co-ordination problems, allows measurement of divisional performance, and can train future senior managers. NSC is to adopt multidivisional structure since it is not a multinational organisation or a small sophisticated service business.
3.3 Organisational Culture
Organisational culture is the "set of belief, values and learned ways of managing of an individual organisation" (Lynch, 2006: 811). Johnson, Scholes and Whittington (2005: 47) provide another definition: "Organisational culture is the 'basic assumptions and beliefs that are shared by members of an organisation, that operate consciously and define in a basic taken-for-granted fashion of an organisation's view of itself and its environment." These authors (p. 199) contend that it is useful to consider the culture of an organisation as consisting of four layers: values, beliefs, behaviours, and taken-for-granted.
Values may be easy to identify in an organisation, often written down as statements concerning the organisation's mission, objectives or strategies, though they tend to be vague, for example, 'service to the community', or 'equal employment opportunities' (Johnson, Scholes and Whittington, 2005: 199).
Beliefs are more specific, though they are issues that people in an organisation can surface and talk about, such as the belief in that the organisation should not trade with certain countries, or that professional staff should not have their professional actions appraised by managers (Johnson, Scholes and Whittington, 2005: 200).
Behaviours are the day-to-day way in which an organisation operates and can be seen by people both inside and outside the organisation, for example, work routines, how the organisation is structured and controlled and 'softer' issues around the symbolic behaviours (Johnson, Scholes and Whittington, 2005: 200).
Taken-for-granted assumptions are the core of an organisation's culture, which are the aspects of organisational life that people find difficult to identify and explain; they are referred to as the organisational paradigm (Johnson, Scholes and Whittington, 2005: 200). A paradigm "is the set of assumptions held relatively in common and taken for granted in an organisation" (Johnson, Scholes and Whittington, 2005: 200).
Organisational culture has the potential to enhance organisational performance, individual satisfaction, the sense of certainty concerning how problems are to be handled, and other aspects of life (Hellriegel, Jackson and Slocum, 2002: 493). Nonetheless, Dennison and Mishra (1995) indicate that if an organisational culture gets out of step with the changing expectations of external stakeholders, it can hamper effectiveness.
Employees in contemporary organisations have encountered the challenge of dealing with difficulties presented by constant change (Rollinson, Broadfield, and Edwards, 1998). These authors contend that organisations have been under mounting pressures for the past two and half decades to change continuously but not when it is deemed necessary to change, attributing this to a combination of forces that ensues from within and outside their environments.
NSC has an open culture while dealing with both internal and external. It has a unique culture of its own, for instance, it does not have a mission statement, a rulebook or any written policies. It does not have an organisation chart, a human resources department or even, these days, a headquarters (The Observer, 2003).
Subordinates choose their managers, decide how much they are paid and when they work; meetings are voluntary, and two seats at board meetings are open to the first employees who turn up. Salaries are made public, and so is all the company's financial information (The Observer, 2003).
Only short-term strategies are adopted. The Observer (2003) reports that six months is the farthest ahead the group ever looks. Its units each half-year decide how many people they require for the next period. Naturally, it does not plan which businesses to enter; rather, it 'rambles' into new areas by trial, error and argument. Its current portfolio is an odd mixture of machinery, property, professional services and fledgling hi-tech spin-offs (The Observer, 2003).
With regard to change, Bock (2005) reports that there have been two kinds of change at NSC. The major organisational changes took twenty years to become reality and not one was the result of any sort of master plan. Instead, the big changes were driven by crisis such as financial hard times or Semler's stress-related illness. With very few exceptions most of the impressive ideas came from someone other than Ricardo Semler. His genius has been in holding to a general concept of empowerment and allowing and supporting changes that could easily have been viewed as taking away his power.
4. Leadership and Teamworking
Leadership can be looked at in many ways and there are many interpretation of its meaning (Mullins 2005: 281). It might be interpreted in simple terms, for example, 'getting other to follow' or 'getting people to do things willingly', or explained more specifically, such as 'the use of authority indecision-making' (Mullins 2005: 281).
There are many hundreds definition of leadership in the literature (Crainer 1995, cited in Mullins 2005: 281). Gardner (1990: 38) provides a good example of defining leadership, maintaining that: "leadership is the accomplishment of group purpose which is furthered not only by effective leaders but also by innovators, entrepreneurs, and thinkers; by the availability of resources; by questions of value and social cohesion." Horner (1997: 275) states that by this definition, leadership can be envisaged as a broad phenomenon However, for the purpose of this assignment, I shall adopt the definition reported by Mullins (2005: 282): "A relationship through which one person influences the behaviour or action of other people."
Leadership is important for a number of reasons. For example, Lynch (2006: 355) maintains that leadership is "a vital ingredient in developing the purpose and strategy of organisations."
Horner (1997) indicates that leadership creates an environment in which people are motivated to deliver and move in the direction of the leader. Mullins (2005: 282) also argues that leadership is related to motivation, interpersonal behaviour and the process of communication. This means that leaders need to tackle the situation within which work is performed but not by the need to concern themselves with the tangible behaviour they display (Horner 1997).
Organisational viability depends to a certain extent on effective leadership, and effective leaders participate in both professional leadership behaviours, such as, establishing a mission, creating a process for realising goals, aligning processes and procedures, etc., and personal leadership behaviours, for example, building trust, caring for people, and acting morally (Mastrangelo, Eddy and Lorenzet, 2004). These authors also indicate that leadership behaviours and actions are important determinants of effectiveness.
Mullins (2005: 282) state that good leadership involves the effective process of delegation and empowerment, and the leadership relationship is not restricted to leader behaviour which results in subordinate's behaviour, adding that leadership is a dynamic process.
Good management leadership helps to develop teamwork and the integration of individual and group goals, and aids intrinsic motivation by emphasising the importance of the work that people do (Mullins, 2005: 282).
Sell (in Mullins, 2005: 873) notes that the term empowerment is a fairly recent addition to management vocabulary and could be seen as just another trend. Empowerment, as sell puts it, means delegation to the most appropriate level of responsibility to take actions to improve performance. He adds (see Mullins, 2005: 873) that it means making people responsible to the quality of their own work and giving them the means to test and inspect it. It also means putting employees in direct contact with customers when changes are being considered that will change the way in which they will have to work.
Empowerment is an important contributor to organisational effectiveness in two ways (Sell, in Mullin, 2005): it enables all the latent knowledge to be utilised, and if there is meaningful participation during a change then those affected are more likely to 'own' the result and all it implies. Sell also adds it is especially important when there is a high degree of uncertainty and a consequent need for flexibility of action by employees.
Implicit in empowerment is the need for teamworking. By this Sell (in Mullins, 2005: 875) means the willingness to work together for the profit of the organisation and its employees.. The emphasis, he adds, should be on co-operation within the organisation with the minimum of competition between individuals and the constituent parts.
Teams are of various types: The main workgroup teams which occur at all levels, temporary teams, such as project teams or more permanent teams, for example, those concerned with cross-functional improvements that span the whole organisations (Sell, in Mullins, 2005: 875).
It is recommended that the company should further encourage teamworking and empower its staff to help them become more productive in their units and projects.
5. Performance Management and Motivation
5.1 Performance Management
Performance management is a term that is relatively new, given the fact that organisations have been interested in employee performance (Currie 2006: 161). The foundations of performance management are in the human resources management (HRM) belief the "organisational success is determined by the performance of its employees" (Currie 2006: 161).
Performance management has been defined in various ways by different authors University of California, Berkley (2006) maintains that performance management is one of the strategic processes which, when effectively performed, helps employees know that their contributions are recognised and acknowledged. Performance management is an ongoing process of communication between a supervisor and an employee which takes place throughout the year, in support of accomplishing the strategic objectives of the organisation. University of California, Berkley (2006) goes on indicating that the communication process includes clarifying expectations, setting objectives, identifying goals, providing feedback, and evaluating results. Recently, Currie (2006: 162) has provided a good definition:
"Performance management is a systematic and strategic approach to ensuring that employees' performance, as individuals and team members, enables the organisation to achieve a competitive advantage by producing the level and quality of products and services that lead to customer satisfaction and, thereby, the achievement of objectives and the ultimate realisation of strategy."
The main purpose, according to Currie (2006: 162), is to "improve the performance of all employees across the whole organisation; employee development, therefore, is a key issue." In other words; performance management is through development. In order to improve performance it is imperative for the organisation to have a set of effective development programmes which are available to everyone (Currie 2006). Performance can be improved using goals and rewards.
In terms of setting goals, Hellriegel, Jackson and Slocum (2002: 377), goals affect motivation in two ways: by means of increasing the amount and effort people choose to exert and by directing or channelling that effort. According to the goal-setting theory, "managers can direct performance of their employees by assigning specific, difficult goals that employees accept and are willing to commit to" (Hellriegel, Jackson and Slocum 2002: 378). Furthermore, goal setting can be effective only if employees have the competencies required to accomplish the goals and receive feedback concerning their progress towards accomplishing them (Hellriegel, Jackson and Slocum 2002). A number of studies have been reported to have documented that performance is improved when employees are guided by specific and difficult goals. It is also argued that when done correctly, goal setting has been shown to be equally effective for employees working in a wide range of jobs. Hellriegel, Jackson and Slocum (2002: 378) add that at present, many of the basic principles from the goal-setting theory are accepted as standard management for maximising employee performance (see Locke 2000, Locke 1968, Locke and Latham, 1990).
Specific goals are more effective motivators than are vague, ambiguous goals, since such goals help focus attention on a well-defined task so that any effort expended by employees tend to be more inclined to translate into goal achievement. Specific goals are make it possible for employees to gauge how ell they are doing (Hellriegel, Jackson and Slocum 2002). This ties up with the NHS goal setting, since the specific goal is set to shorten the waiting list, which is a tremendous job to achieve, given the difficulties the NHS has experienced over the past three decades. Hellriegel, Jackson and Slocum (2002: 378) argue that "if a goal is specific, employees can quickly judge whether heir efforts are paying off in terms of performance. Employees can then use this feedback to decide whether to continue using the same methods or try new approaches."
Goals, to be effective, must be challenging, but not very difficult such that employees believe that they cannot be achieved. If they are very easy, they do not given the employee the impetus to exert extra efforts. Conversely, if they are very difficult, the employee with reject them as impossible and will not even concerned trying to achieve them (Hellriegel, Jackson and Slocum 2002: 378).
Irrespective of how the goals or performance standards are selected, it is effective only if employees accept them and feel a commitment to trying to attain them (Stajkovic and Luthans 1998, Hellriegel, Jackson and Slocum 2002).
Recently, Armstrong and Ward (2005: 15) have indicated, basing their findings on six case studies, that organisations find it difficult to guarantee consistent implementation of performance management. They report three key messages concerning people management capability:
"The capacity to deliver performance management relies on identifying and developing the core people management skills.
Performance management training tends to focus on the process.
The emphasis needs to shift to helping managers change behaviour, rather than helping them to be 'process' experts."
Hence, goal-setting should be about motivation not just control and alignment, as argued by Armstrong and Ward (2005).
Mullins (2006: 471) argues that the underlying concept of motivation is "some driving forces within individuals by which they attempt to achieve some goal in order to fulfil some need or expectation." He also indicates that this concept gives rise to the basic motivational model (Figure 7).
A simplified illustration of the basic motivational model
(Mullins, 2006: 471)
Mullins (2006: 478) indicates that there are a number of competing motivational theories that attempt to explain the nature of motivation, and that they may all be at least somewhat true, and help to explain behaviour of certain people and certain times. Motivation theories can be divided into two groups: content theories and process theories. The content theories include: Maslow's hierarchy of needs model; Alderfer's modified hierarchy model; Herzberg's two-factor theory; and McClelland's achievement motivation theory.
Maslow's hierarchy is usually shown as ranging through five main levels, from, at the lowest level, psychological needs, through safety needs, love needs, and esteem needs, to the need for self-actualisation at the highest level.. The hierarch of needs may be shown as a series of steps, but is often displayed as a pyramid (Mullins, 2005: 480) (Figure 8).
Maslow's hierarchy of needs model
The pyramid display is an appropriate form of illustration since it implies a thinning out of needs as people progress up the hierarchy. The five hierarchies are: Physiological needs [physical survival needs], safety needs [need for safety and security], love needs [social needs - belonging], esteem needs [need for self esteem], and self-actualisation needs. When a lower need has been satisfied, it no longer acts as a strong motivator; the needs of the next higher level demand satisfaction and become the motivating influence (Mullins, 2005).
Process theories, or extrinsic theories, "attempt to identify the relationship among the dynamic variables which make up motivation and the actions required to influence behaviour and actions" (Mullins, 2006: 489). These include: Expectancy-based models, Equity theory, Goal theory, and attribution theory
Adams' equity theory states that employees endeavor for equity between themselves and other workers. Equity is achieved when the ratio of employee outcomes over inputs is equal to other employee outcomes over inputs (Adams, 1965), as illustrated in Figure 9..
An illustration of Adam's Equity Theory of Motivation
(Theories of Motivation, http://www.laynetworks.com/Theories-of-Motivation.html)
The discussion above clearly shows that the performance of NSC's management and employees has developed in recent years which has contributed to its success, given the difficult financial situation experienced by industry in recent years. It is therefore recommended that pay should be on made on the basis of by performance (PBP), due to the fact that employees are not only interested in financial terms. Self-development and positive feedback to their managers makes them happier and highly motivated at work. Furthermore, according to Maslow's Hierarchy of Needs Model, managers need to be concerned with what their employees need, and then decide on the appropriate reward strategy to motivate them.
Outsourcing means letting other organisations perform a needed service and/or manufacture needed parts or products (Vining and Globerman, 1999; Klass, McClendon and Gainey; 1999; in Hellriegel, Jackson and Slocum, 2002: 26). At present, managers face a new challenge: to plan, organise, lead, and control a company that may have at least some of its operating functions performed by other companies (Pitts and Lei, 2000; in Hellriegel, Jackson and Slocum, 2002: 26). Production is the most commonly outsourced function, and by outsourcing production, an organisation can switch suppliers as necessary to use the supplier best suited to customer's needs.
NSC has started outsourcing its some of production functions to other companies and changed its suppliers to suit its customers' needs. It did, and does so, by encouraging its employees to consider starting up satellite supply companies and subcontracting for NSC. Employees who have selected this entrepreneurial route have been allowed to take NSC machines with them, leasing them on favourable terms. One advantage for NSC is that it is no more responsible for the maintenance and safety of the equipment, and also reducing its staff number and eventually reducing the size of the production floor space. Moreover, there is the prospect that the machinery can be used more effectively since the satellite companies are free to work for other. If the venture fails, NSC takes back the equipment and the people.
6.2 Recruitment of Female Workers
Women have been discriminated against in job market for many decades, and women have been paid less than men working in similar jobs, or having the same qualifications. A new International Labour Organization (ILO) Report maintains that women not only have more problems procuring paid employment and generally receive lower wages and fewer benefits than men, they also suffer from higher levels of irregular payments. Findings of the People's Security Surveys (PSS) conducted in 15 countries around the world featured in the new ILO report on economic insecurity also indicate that what they earn, women cannot keep but need to hand to their husbands or other family members (ILO, 2006).
The study also found that discriminatory recruitment practices against women are more common among small firms, and greater in private than in state enterprises in every country covered by the Enterprise Labour Flexibility and Security Surveys (ELFS), including Brazil, Chile, China, Indonesia, the Republic of Moldova, Pakistan, the Philippines, the Russian Federation, Tanzania and Ukraine (ILO, 2006).
Women find themselves out of employment in many countries around the world, and for a number of reasons. Women with children or expecting mothers might find it very difficult to get a job, and in some countries there is a ban on women working outside home. Many women did not have the change of full education, and hence, grow up without any suitable qualifications to help them find proper jobs. In some societies there are very little employment opportunities for women. Laws and acts have been passed in many countries to resolve this social problem, and the United Nations made it illegal to discriminate against women in employment.
There are certain factors that should be taken into consideration when employing women, including: health and safety provision, manual handling improvements, sufficient facilities, career breaks, crèches, and flexible hours. NSC have addressed this issue by introducing programmes that seek to reduce this discrimination. In order to increase the number of women in NSC's workforce, it is recommended that it should provide female employees with the following:
flexible working hours;
extra facilities, for example, changing room and toilet, etc.;
equal opportunities concerning employment and pay;
job satisfaction; and
training and development programmes.
7. Training and Development
Training and development is a major area of the personnel function of special relevance to the effective use of human resources (Mullins, 2005). The importance of training as a central role of management has long been recognised by leading scholars. Drucker (1977), for example, indicates that the one contribution a manager is outstandingly expected to make is to give others vision and ability to perform, and a basic operation in the work of the manager is to develop people and to direct, encourage and train subordinates. Training is necessary to ensure an adequate supply of staff who are technically and socially competent, and capable of career advancement into specialist departments or management positions. Accordingly, there is a continual need for the process of staff development, and training fulfils an important part of this process, and training should, therefore, be viewed as an integral part of the process of total quality management (Mullins, 2005). In fact, training has become the focus of a major attention in various countries of the world, as evidenced by the wealth of literature discussing various issues relating to training and its impacts on human resource development. Its importance is particularly amplified in areas relating to development and management.
The purpose of training is to improve knowledge and skills, as well as to change attitudes. This, as Mullins (2005) argues, can lead to several potential benefits for both individuals and the organisation, maintaining that training can: increase staff confidence, motivation and commitment; provide recognition, enhanced responsibility, and the possibility of increased pay and promotion; give a feeling of personal satisfaction and achievement, and broaden opportunities for career progression; and help improve staff availability and quality.
It can be concluded that NSC should build upon its strengths, and attempts to address its weaknesses to strengthen the company in areas that ithas performed poorly. The company also needs to exploit opportunities and tackle threats facing it.
There are many different organisational structures, some of which have beenn explained earlier. However, it can be concluded that the company is still adopting a hierarchical structure, for which it is recommended that it needs to adopt another structure, that is, multidivisional structure to better suit its operations and increased its performance and productivity.
NSC has a unique culture of its own, such as not having a mission statement, a rulebook or any written policies, an organisation chart, a human resources department or even a headquarters. Subordinates choose their managers, decide how much they are paid and when they work; meetings are voluntary, and two seats at board meetings are open to the first employees who turn up. Furthermore, only short-term strategies are adopted.
With regard to change, the company has experienced two kinds of change, a major organisational change and other changes driven by crisis such as financial hard.
It can be argued that the performance of both management and employees have developed in recent years which has contributed to the company's success. Self-development and positive feedback to their mangers make staff feel happier and highly motivated at work. NSC encourages its employees to consider starting up satellite supply companies and subcontracting for NSC.
NSC have addressed the issue of female employment, by introducing programmes which seek to reduce this discrimination.
Finally, NSC does not offer formal training programmes, but responds in various ways when employees ask for a chance to develop new skills; however, it does not have any development programmes. However, it is recommended that it should offer formal training and development programmes to their employees to help them develop their career.