Human capital are recognised as the most important resource in and which can be used to achieve competitive advantage of a firm. As such they need to be managed professionally in such as manner they are aligned to organisational strategy. This essay identifies issues of overstaffing and misaligned goals in the firm and offers solution of using fact-based model and performance model to solve these issues. Recommendations on actionable plans are outlined at the tail-end of the essay.
The essay analyses a case study of human resource management in CGMS company. The essay identifies issues plaguing the organisation to cause it to be inefficiently managed. This is shown in the costs that are incurred by the firm in comparison to the value the organisation derives from workers. There are misaligned strategies between human resource practices and what needs to be done to achieve desired strategic goal
Identification of issues
The company has been successful in the mining business and over the last ten years, it has depended on employment of people that were handpicked to perform specific roles in the organisation. These are preferred workers that the organisation feels losing them would be tantamount to selling their trade secrets for free. The organisation is not sure whether it needs to trim its workforce or to retain it to accomplish needs of the organisation. And the reason for this is the management knew the bolts and nuts of the organisation and dismissed importance of using assistive technology in this regard.
The organisation has become unwieldy due to the size, its competitiveness has reduced and cash outflow is increasing beyond its capacity. There is “work imbalance, equipment orders has slowed down and demand for servicing has increased”. Besides the high wage bills, these are the reasons that are causing the business to lose money despite the fact they all seem to be working by deadlines and being fast in decision making. Another outstanding issue is deciding whether the current workforce is competitive or not, and if they are, which ones are not. Thequestion begs for answers due to the fact that more than a thousand workers had been brought to the workforce to do designated duties but up until then, nobody knew who did what.
From the facts presented, it is clear that the organisations does not have human resource management system that is linked to the strategic goals of an organisation. Besides, best human resource management practices such as performance management. Due to lack of this, there is no accountability of roles and goals set by the organisation are not SMART. Had they been SMART, they would be translated down the line of management so that each worker is assigned certain functions in expectation of predetermined results. while it is a noble idea to protect key or strategic human resources, the problem is there is no way of knowing who to retain because there is no way of telling who does what and how effective and efficient were the results. This yields another issue that whereas the organisations could be effective in attaining its goals, it is highly inefficient. It is noted that workers “are very good at getting things done, solving problems and sticking to deadlines”. This is being effective or realisation of a desired predetermined goal. At the same time, it is reported that “the cash flow is a mere trickle….we need to cut down costs…” The company was“haemorrhaging money” severely. This is an indication that the cost of achieving the goals of the organisation was too high compared to what was achieved, hence, inefficient. The solution might not be n sacking everyone but using modern IT infrastructure to manage human resources so that each worker was responsible for certain results, which all would result in realisation of a bigger role.
Strategies for evaluation
The solution needed in this organisation is one that will make utilise the current resources efficiently to achieve a certain goal effectively. It should be a solution that will align human resources to strategicobjectives of the firm to make it competitive.There is need to shift towards a fact-based decision model to manage human resources in this organisation. To use this system, there is a need to consider financial and technical support commitment to make this system completely functional and efficient to the firm. However, the gains by far outstrips the inputs if all mechanisms of installation and implementation of ERP are put in place. However, technologycannot bea solution if the management do not understand the issues plaguing the company. The main aim is to align talent management to strategic needs of an organisation so that required resources will be identified and appropriate technology implemented. Once it is realised, it can help an organisation to achieve both effective and efficient goals (Luftman, 2011).
In using IT to manage human resources, one of the approaches would be to measure performance of all workers. According toLawler(2012), IT can be used to create centres of excellence, help develop talent and align organisational strategic needs to human resources. Workers that are opposed to IT need to be trained to prepare them for a new paradigm shift of adopting it to improve their needs. The training in itself in an innovation that will be explained to the workers and management to rely on results and metrics to measure and manage human resources. AsSchein(2010), organisational learning ought to be accompanied with technical innovation to yield effective results in management of human resources.
Organisation culture of using performance management ought also to be introduced so that job description are outlined and qualified personnel allowed to occupy them. It is called the performance culture model whose premise is to involve all workers and steer them towards a common predetermined goal. It is said to be the most powerful of all HR management models basically performance is the main focus and this way, it is aligned to goals of an organisation. Hence, there is measurement of worker productivity and this is what is used to hold all workers responsible for their decisions and results(Sullivan, 2010).
Communication is necessary to deploy IT-based infrastructure where all the employees will learn and accept it as the norm of doing things in the organisations. This can be both formal and informal where trainings and support is provided by developers as well as collaboration amongst employees themselves (Kidron, Tzafrir, Meshulam, & Iverson, 2013).
ERP platforms are expensive to installand so is the process of training everyone in the organisation, particularly the management on how to use it. Fact-based model that uses ERP can be used alongside performance model to enhance realisation of organisational goals. ERP can be used to measure worker productivity by providing metrics that are tracked with time (Bloom & Reenen, 2011). In this regard, it will be easy to link productivity to compensation, which is one of the tents in human resource management. Besides, technology can be used to inform management which jobs are actually needed and those which are not. This way, it will be easy to align skills and job descriptions that are strategic to needs of an organisation (Holbeche, 2013). By visualising skill requirements and the available workers in the organisation, it will be possible to eliminate those that make the whole organisation to be bloated. At the moment, there are workers that are doing jobs that are not suited for them or several workers do a simple task that could be done by a single person. Workers that should be retained are those whose contribution is related to strategic goals of the firm.
Conclusion and recommendations
Few organisations realise the need for aligning strategy with human resource management. And even with realisation of the place of IT in management of the firm, only a paucity of firms have utilised it to analyse worker productivity, performance of the whole firm and talent management. Used effectively, it can be used to assess what skills are needed and where there is deficit of skills to achieve specific predetermined goals. CGMS exhibited typical symptoms of a bloated organisations where workers are employed without any specific plan, they are not evaluated and therefore their role is not attached to achievement of any specific strategic goal.
These are aimed at addressing immediate needs of the organisation as well aiding in long terms attainment of predetermined goals of the firm. Thus, the following actions are recommended:
- At the top level of an organisation the management should define strategic or SMART goals that are to be achieved in the long term. This is the source of strategy of the whole organisation from which medium term and short term goals are to be achieved.
- In so doing, the business will need to identify key skill requirements and who is best fitted to accomplish this task
- Workers that are not needed in the organisation should be relieved of their duties as per the regulations of the organisations and authorities.
- A series of trainings should be carried out in the organisation create awareness on the need to streamline workers according to create organisational goals. Trainings will also be used inform the management and workers on functioning of ERP and how it will be integrated activities of the firm.
- Performance management approach ought to identified and agreed on by all workers in the organisation. This mean all employees will be made aware of how they will be evaluated, how often and expected results from their activities. Among things that will should be agreed upon include performance metrics and compensation or rewards for specific achievements.
Bloom, N., & Reenen, J. V. (2011). Chapter 19 – Human Resource Management and Productivity. Handbook of Labor Economics, 4, 1697–1767.
Holbeche, L. (2013). Aligning Human Resources and Business Strategy. New York: Routledge.
Kidron, A., Tzafrir, S. S., Meshulam, I., & Iverson, R. D. (2013). Internal integration within human resource management subsystems. Journal of Managerial Psychology, 28(6), 699 - 719.
Lawler, E. (2012). Effective Human Resource Management: A Global Analysis. Stanford : Stanford University Press.
Luftman, J. (Ed.). (2011). Managing It Human Resources: Considerations for Organizations and Personnel. Hershey: Idea Group Inc (IGI).
Schein, E. H. (2010). Three cultures of manageemnt: the key to organisational learning. In L. R. Bertagni, Glocal working. Living and working across the world with cultural intelligence (pp. 37-60). Bernstrasse: FrancoAngeli.
Sullivan, J. (2010). Selecting an HR strategy. Retrieved September 7, 2013, from Workforce Info: