The main goal of the research paper is to analyze the human management practice that is used by the company and to provide recommendations, based on this analysis. We should demonstrate that we have understood all the theoretical concepts and are able to apply them to practical situations. The goal is realized via objectives.
The objectives of this research paper are the following:
- To analyze the practices that have been used by the company under consideration to manage people;
- To explain the role of Karen in human resources management and the challenges that she meets;
- To provide recommendations for Karen what could be done to improve the concept of the people management in the company.
Taking into account the goal and objectives of the research paper, it is going to have the following structure: a brief description of theoretical concepts; background information about the case; analysis of the case; conclusions and recommendations for the company under consideration. Such structure is needed to understand the subject of the research and reach its main goals.
First of all, we would like to provide a definition of the term “human resource management”. In our opinion, one of the most appropriate definitions of this term is the following.
“As outlined above, the process of defining HRM leads us to two different definitions. The first definition of HRM is that it is the process of managing people in organizations in a structured and thorough manner. This covers the fields of staffing (hiring people), retention of people, pay and perks setting and management, performance management, change management and taking care of exits from the company to round off the activities. This is the traditional definition of HRM which leads some experts to define it as a modern version of the Personnel Management function that was used earlier” (Human resource management).
Simply speaking, human resource management can be considered as the process of management of human capital in a company. Human capital, knowledge and information are the main factors of production in the modern conditions. The modern economy and society can be called informational ones. A company gets competitive advantages on a market, when it has more information or better knowledge. Human capital is a carrier of such knowledge. That is why we can claim that a company’s success depends on the degree of efficiency of the human resource management. Therefore, the role of this process just cannot be overestimated.
Human resource management is the overall concept that is used by companies
It consists of a lot of processes: hiring, firing, controlling and monitoring, motivation of employees, training, etc. All these processes cannot be chaotic. They should be united under one concept and strategy. In turn, this strategy should be an integral component of a strategy of overall development of a company.
Generally, human resource management is used to increase value of human capital. This value is basis for the further growth of value of the whole company. It is not surprising that companies pay a lot of attention to this side of their performance.
Generally, two approaches to human management process can be pointed out. We can call them traditional and modern ones. A traditional approach has been used for a lot of decades. It claims that employees should strictly follow stated rules and standards of performance. An employee is like a tiny part of a big mechanism. His/her interests should not be below the interests of a company. The degree of freedom of employees is really limited. We must admit that some companies in particular industries still use this approach.
“The traditional human resources management approach entailed either hiring people with the required skills or training employees to develop the skill sets required for the organization. The challenge for human resources in the new order is to ensure an employee-employer fit” (Nayab 2011).
The modern approach provides broader degree of freedom for employees. It states that every employee is a unique person with own interests and features. The task of human resource management is to boost positive and creative potential of every employee. That is why employees should be provided with a high degree of freedom. They should feel themselves as members of a big family. Efficiency of their work is going to be much higher in such conditions. We believe that this approach is more effective than the previous one. We are going to see below that the company under consideration uses the second approach.
Now it is time to provide background information about the case under consideration. Karen Gallaghan is a people director in the company, called Innocent. He believes that combination of chaos and order in human resource management can be quite beneficial for a company. She believes that balance of chaos and order is able to create beneficial environment inside a company. It makes this environment alive and flexible. Also, she supports an opinion that simplicity must be an integral element in relations with employees. This approach can be called successful, since the company itself is really successful. Karen states that 95% of the objectives are met by employees in the conditions of high degree of freedom and even chaos.
In order to understand the company’s approaches to human resource management we have to know some information about the company itself. The company is specialized in production and sales of natural drinks. It is a British company. It is 58% owned by The Coca Cola Company. The company is quite young. It was founded in 1999. However, it has become quite popular since that time. The company is still growing, which posses some challenges to it, about what we are going to talk below. Some additional information about the company can be got from the quote below.
“It boasts no added water, sugar or other sweeteners, concentrates, or preservatives in its products, which include juices, smoothies, and thickies (yogurt and fruit); it also offers fruit tubes (pureed fruit and juice in squeezable packaging). Innocent also makes veg pots - microwaveable lunch servings that contain vegetables, herbs and spices, a whole grain, and a sauce. Selling more than 2 million smoothies every week, Innocent's products can be found at European coffee shops and retail food outlets. It was deemed the official smoothie and juice of the London 2012 Olympic Games” (Innocent Ltd. company profile).
Generally, we can say that the process of human resource management is effective in the analyzed company. Employees are satisfied and the managers are satisfied with employees. The company is growing and its results are satisfying. Karen has managed to implement the system of human resource management that perfectly meets features of the company, the number of employees and desires of shareholders. In fact, we must say that it is not an easy task, what means that Karen deserves respect. Her professionalism should not be doubted.
Also, we should mention about the role of Karen in establishment of such system of human resource management in the company. She is a creator and the main protagonist of the system, which has been called a balance between a chaos and order. Karen has managed to convince employees and managers that they should follow this system. She is able to maintain the system in the modern difficult economic conditions. It is a sign of the high degree of Karen’s enthusiasm and professionalism. We are convinced that Karen should remain a people director in the nearest future. This woman has not yet built a system in its ideal form. She should be provided with more time. That is why the company’s shareholders should not hurry to fire her, even if the system shows some worse results.
Yet, the system has proven its efficiency
However, the whole system and Karen herself are going to face significant challenges. Some of these challenges are minor and typical for any business. They can be solved, using the typical receipts and instruments. The other ones are more complicated and related to the process of development of this particular company. Among these challenges the following ones may be pointed out:
The modern business world experiences the global financial crisis and its consequences. The overall economic conditions are not supportive for any business. The business under consideration is not an exception. Financial results of the company may worsen and it may significantly influence motivation of employees and the whole system of human resource management. Our words that the global financial crisis posses a lot of challenges can be proven by the following words:
“Some have been writing for many years that while the current economic ideology is flawed, it only needs minor tweaking to correct it and make it work for everyone; a more compassionate capitalism, but capitalism nonetheless. Others argue that capitalism is so flawed it needs complete doing away with. Others may yet argue that the bailouts by large government will distort the markets even more (encouraging bad practices by the big institutions) and rather than more regulation, an even freer form of capitalism is needed” (Global financial crisis).
The company’s financial results are quite satisfying at the moment
However, they may worsen in the current unstable conditions. The company and Karen herself should be ready for such scenario. They should be ready to fire people and to get more efficiency from the rest workers. The way to do it is to rely on intellectual potential of employees and constantly increase it.
The business is growing. Of course, it is a good sign for any company. However, it also poses additional challenges. Organizational structure is becoming more complicated, and the number of employees is also growing. It is more difficult to apply controlled chaos to a large number of employees. In fact, they may become uncontrolled in such conditions. The HR management system must be improved and the current instruments may not work in the changing conditions. Probably some new receipts should be introduced. For example, Karen should expand the whole HR department, since she will need some help in the mentioned conditions.
Finally, we must say that chaos is quite difficult to control. You can never be sure that everything is going according to a plan in such conditions. Control requires significant personal and financial resources. Such control is going to become even more difficult in the conditions of the growing company.
There are a lot of mechanisms of such control
For example, employees still have to follow some basic rules of work. They should have and meat deadlines. On the other hand, they should be punished, when they do not meet these requirements. They should accept the general principle that success of the company is also their success, and failure is also their failure. Someone should always bear responsibility. Such situation is even typical for family or friendship. That is why there is no need to be surprised.
To conclude we would like to say the following. Human capital is probably the main factor of production in the modern conditions. Human capital is a carrier of information and knowledge, which are the main competitive advantages of any company in the modern conditions. That is why it is very important to increase its efficiency. It can be done via implementation of effective system of human resources management. Simply speaking, human resource management can be considered as the process of management of human capital in a company. It includes such processes as hiring, firing, motivation, etc. In fact, any process that relates to work and relations with employees can be called as a part of human resource management concept.
We have analyzed the practice of human resource management in the company, called Innocent. The company is characterized with quite an interesting approach to this problem. It can be classified as combination of chaos and order. We may that the system tends to be a controlled chaos. Its essence can be described with the following words. Employees have particular tasks and deadlines; they must execute these tasks and reach objectives. However, they are provided with a high degree of freedom in the process of execution of these tasks. Their creative and intellectual potential are boosted in such way. Such approach is not unique. A lot of other companies, especially, in the IT industry use it. For example, we can mention Google Inc. and Twitter.
Yet, the system has been effective and contributed to the overall growth of the company. There have not been significant problems and employees have reached their goals, since the company was founded. The main protagonist of this system is a people director Karen. We believe that she is characterized with a high degree of professionalism and creativity. The company may relate on her in the nearest future. However, Karen is going to face significant challenges in the nearest future. Taking into account these challenges, we may provide the following recommendations:
First of all, the company should improve its system of control in the face of growing organizational structure. We have said that the degree of control is not enough in the conditions of chaotic approach. This chaos is only going to grow along with the company’s growth. We believe that the company should follow a strategy, which can be called a controlled chaos. Especially, this factor is important in the conditions of economic uncertainty and volatility.
Second of all, the company should pay more attention to the problem of continuous training and education of employees. Their knowledge should become the company’s main competitive advantages. We have not found enough information about this fact in the provided article. We cannot be sure in the company’s strategy in this area. Probably, everything is OK. In any case, it is important to tech employees and to make them reedy to any challenges of the modern business world and society, in general.
Third of all, the company should accept a practice of preparation of its own employees. We mean that the company should look for talented students, propose the different programs and internships for them, invite to a job. The company will able to get the best students in such a way. Thus, it is vitally significant to think about the future, not only about the present.
Finally, the company should have a few strategies of HR management
It will be able to meet any challenge in such case. We mean that the company strategy should be flexible. It would be nice to have three scenarios – pessimistic, realistic and optimistic. The character of every scenario depends on the overall economic conditions and the company’s results. In turn, every strategy should be implemented in the different situations.