HR Strategy

HR Strategy

Part 1: Innocent Drinks

Introduction

Company profile

Founded by three university graduates, Adam Balon, Richard Reeds, and Jon Wright from Cambridge university way back in 1999, innocent Drinks Company manufactures smoothies from pure fruits and flavor added spring water packed in bottles that can be recycled (Temporal, 2011). Innocent is a UK based food industry and by the time if its establishment, the founders had a motive of selling their products in supermarkets and coffee shops among other market outlets. The company has however spread outside the UK. It is doing a booming business in countries like France, Amsterdam, Ireland, and Brussels (Stokes & Wilson, 2010). In these countries, the company makes sales of more than 2 million in a week. Despite the fact that the company is very young and facing competitors like Tropicana, it is ranked position four as one of the largest producers of smoothie brands in the UK.

Innocent drink organization has always geared itself at producing quality products labeled “innocent” with an implication that the products are natural and pure or unadulterated. The company offers one of the best services in the market through customer satisfaction and makes sure that their products get to the consumer in the right variety and quality (Bains, et al, 2012). Delivery vans are fitted with cooling systems, which adds flavor to the services offered to the consumers. The organization has always adhered to ethics of producing fresh products from fresh fruits with no preservative additives, concentrates, or stabilizers to give the customers a feeling that is always good and satisfying.

Problem analysis

The recent move by innocent company has not been very smooth especially when it was faced by the 2008 economic recession that made it register hefty loss of billions of money; consequently, a decline of its share was inevitable. To sustain competitive advantage in the market; a few factors should be put into consideration;

Key factors and work practices: the factors that the company has to gear itself into having a strong grab to are the ones that will always make the company sustain itself in a complex and dynamic market environment. Such factors will always guarantee the company of sailing through with maximized profits and fewer difficulties. Innocent company at first need to have an excellent customer service that is friendly, humane, and maintained at personalized levels. This of course is achieved if delivery of products to the market is at the right quality and variety, which the company has maintained since its establishment (Mennillo, et al, 2012). Still another very strong factor is maintaining transparency in fitting value for money pricing. A consumer would always want to see the value for the money spend on a product by getting full satisfaction of his needs. Innocent drinks have always given consumers satisfaction since they are made of pure natural fruits with no additives. The taste has also been maintained. Innovation is at the same time a vital factor to be put into consideration by this company. There is a need to come up with packaging materials that are environment friendly in turns of pollution, non-hazardous to users and possibly recyclable to minimize costs of production.

Product sustainability is another vital factor to consider if innocent company has to sustain its competitive advantage (Mennillo, et al, 2012). A product is said to be sustainable if it readily satisfies the customers’ needs and on top of that help in the improvement of social and environmental performance. Therefore, innocent company should be in a position to offer products that are sustaining to its consumers. The company needs to consider good working ethics with its employees. Good employee packages are vital here since this act as motivation to them.

Innocent company has the desire of expanding its business outside the European countries, therefore it should put into consideration language and cultural barriers associated with the target markets. The marketing strategies used in the UK may lose meaning or be lost through translations when the products are taken to new markets. As such this should be handled carefully otherwise the product may not win the market as deemed.

Challenges

Despite the fact that innocent drinks company had started well and grown rapidly, it has not run away from challenges that of course are inevitable in any business environment. Stronger rivals have posed a big challenge to the young Innocent drink company by trying to wipe it out of the market. A smoothies and food company PepsiCo, has made innocent company start to shiver with a wavy impact, which if not counteracted it may leave innocent in a shabby situation. Tropicana smoothie from Pepsi has offered challenging competition to innocent. Tropicana is retailed at reduced price rates that also force innocent to lower their prices to counter face them. Customer downturn has also proved to be another challenge to innocent drink since customer turn-up is claimed to be low (Mennillo, et al, 2012). This is partly contributed by Pepsi selling their Tropicana product at almost half the price of innocent drink and the company failing to introduce smaller packs for customer affordability. Innocent company is as well faced by the challenge of increasing the work staff irrespective of the company’s decline in sales turnover (Stokes & Wilson, 2010).

The implications of HR strategy in the organization;

The performance of an HR in any organization may determine the failures or success of an organization. Owing to the prevailing competition from the rival companies, then innocent has to come up with innovative means and make sure that the work force is well trained to increase production and be capable to face competition head on. This is actually the reason as to why the HR is placed at that level so as to maintain full support of the employees through full time motivation and training relevant to every individual’s role in the organization. The result for this is bigger relationship of the employee-organization relation (Abbing, 2010), in relation to the theory social exchange concept (Bains, et al, 2012). It should be understood that, the work moral code of employees comes from their mind set and behavior. Therefore, innocent company’s HR has to minimize employees’ turnover through  maximization of reciprocities of benefits which lead to production (Koch 1996), performance, commitment, identification and more involvement in all aspects of their job (Pierce, 2009).

In summary, for innocent drink company to move miles in sustaining itself in the market and coping with various market competitions it has to move forward and create a good customer-company relationship and employee-company-relationship. As noted earlier the key factors to be considered are vital and not to be taken for a ride.  The key factors are crucial since it is through their full evaluation that innocent will always be able to keep their products competitive and well placed in the market. This is in addition to the company’s five strategy points, quality, strong brand developing, vigorous chain supply, strong customer relationships and a working team composed of cheerful employees.

Part 1.2_innocent:

High Performance Work Practices

The term ‘high performance work practices’ has a broad coverage in meaning, and so to understand it we need to look at three basic practice components that drive us to its true meaning. These practices are; employee involvement practices, human resource practices, and finally reward and commitment. The employee involvement practices focus on building a solid relationship between the employer and employee through having confidence and a well defined system of communication between the two parties. The employees in this manner are encouraged to have control over what they do on day-to-day basis by freely making decisions in their workplaces consequently yielding to a motivated teamwork. Under human resource practices, the focus is capitalizing on the skills of employees and investing on them. The HR may come up with programs, which involve recruiting, training, and work redesigning among other processes. In this case, the HR is supposed to become a business strategy developer and implementer through partnering the business and not merely an administrator (Mennillo, et al, 2012).

On the other hand reward and commitment, the organization is aimed at motivating employees by rewarding them. The organization may reward the employees by adjusting to terms, which are employee friendly to create a sense of belonging to the organization. Therefore, ‘high performance work practices’ are the practices in an organization that are geared to the stimulation of the employee and excellent performance of the organization. The incorporation of these practices intertwined with other external factors is believed to yield a good performing business results in any organization. This is achieved through definite value of customers by offering goods and services that meet the satisfaction of their needs, creating top down leadership in the organization, empowering employees’ decision making especially those close to the customers for improved goods and service delivery, and offering supportive measures geared at building trust culture between the organization, customers, and employees (Shakespeare, 2011).

There is evidence to support high performance work practices geared at maximizing the contribution of their employees. The founders of innocent company have the feeing that managing their work force is part of the strategies they lay down in their business (Aaker &, McLoughlin, 2010). They have the believe that the success of their company is within making their employees happy and minding about their welfare, and that’s why they dedicate their biggest percentage of  investment on people’s skills and what is around them to motivate them in doing their job. The company has embarked on creating a favorable working atmosphere to its employees and learning to appreciate the efforts of every individual within the business echelon. This has been the major reason as to why the turnover of employees is minimal. To realize these dreams innocent devised various methods of enticing its employees through various benefit packages. Innocent has been offering packages such as scholarships, roses and poems.

Scholarships: – scholarship of employees is done four times a year, which is determined through bidding. The successful candidate is given 1000 sterling pounds. This is of great benefit to the employees since they can do something that may support them in future other just working at innocent.

Roses and poems: – employees do get them on special days like valentine. There is also guaranteed outing from the company where employees can go to their favorite places. More to this the employees enjoys medical cover through free vouchers given by the company.

Employees are also privileged to enjoy flexibility in their working schedules at any time of the day depending on individual’s choice. An employee can also work from home or anywhere else since the company is IT compliant, which easily copes with distant working. These are just but a few investments that innocent has been able to accomplish on its employees among others like offering social activities, recognition, share ownership and training and development.

The company has won the minds of the employees and customers in not only producing and distributing their healthy drinks but also in the way, they present themselves with responsibility and maintained ethics. They have really taken wise decisions in incorporating good work practices, which has made the company move miles ahead and shine above most companies that produce smoothies. The company has strived in maintaining and building its stand through innovation and collaborating with people, more considerably its employees. Its reputation to the outside world is smart; this is seen through the charity donations of 10% of its shares to the need in the community.

High performance work practices and the AMO model:

The success of innocent company can be associated to adopting good work practices which has made it maximize on the employees contribution to meet a better chance of being competitive in the market. To understand this better we refer to the AMO model (Wilkinson ET AL, 2009), a theoretical driver synergy that helps us investigate such related situation.

The AMO (acronym) model is composed of three elements building a sustaining performance on employees. ‘A’ in the acronym stand for ability of individual, ‘M’ for motivation, and ‘O’ for opportunity. The combination of the three letters in the acronym has a focus on psychology and capitalizing on employees (Wilkinson ET AL, 2009). Motivation in the form of better/high payments, career related opportunities and information sharing about the results and targeted goals of the organization (Wilkinson ET AL, 2009) is actually what any employee would long for. In the acronym the ‘A’ and ‘M’ combination has been at the centre of the theories based on individual level work performance (Wilkinson ET AL, 2009). On top of these, the model emphasizes on the working environment as a big contribution to the execution of talents and abilities by the employee. The ‘O’ in the AMO model is opportunity in performing, whose basis is on work layout and the empowering of the employee. Giving employees’ freedom to make decisions in what they do, working together and sharing the outcomes of targeted goals of the organization, mobilizes them to deliver better results in the business and have a feeling of responsibility in their work. Therefore the contribution of AMO is inspiring the performance of the employees’ on individual basis (Wilkinson ET AL, 2009) and in summation the HPWPs forms the backbone of any managerial department of an organization focused at improving the organization of workforce, workforce approach and aptitude whose combination adds up to credible outcomes of the organization.

 

Part II

Introduction

Talent management is a recent terminology in an ever-increasing and jargon-riddled management world. Indeed, it might be easily confused with the traditional management functions of recruiting, staffing, and retaining employees in a firm. In operationalizing the talent management concept, it is possible for managers and consultants to confuse it with recruitment of employees (Silzer & Dowell, 2009). However, talent management goes beyond recruiting people. This section will explore the meaning of talent management in the context of human resource management. In addition, an effort will be made to show how talent management fits within the strategic human resource perspective. Finally, there will be a discussion on some of the practical issues, such as culture and ethics that must be taken into account while implementing talent management within an organization.

By definition, talent management refers to a continuous process of ensuring that an organization has the right caliber of staff in the right job and at the right time (Silzer & Dowell, 2009). In essence, talent management is a continuous process of seeking the necessary talent for an organization by creating an environment that can attract the very best (Schiemann, 2009, Shukla, 2009). Talent management starts by understanding that each person has a unique talent. This talent must be harnessed if an organization is to achieve its goals. According to Armstrong (2008), an organization should not focus of the favored few, but on the best if it has to realize its objectives. Moreover, the company must ensure that it provides all the required resources for people to harness their potential as they seek to propel the company in the right direction (Armstrong, 2008).

The goal of talent management is higher because it endeavors to attract and retain the best caliber of workers as much as possible (Schiemann, 2009, Shukla, 2009). Talent management is superior because it is proactive. By being proactive, talent management overcomes the traditional problem of recruiting, which is essentially isolation. Traditionally, recruiting has been isolated from other functions like workforce planning and redeployment. However, talent management integrates all the function into a one continuous and endless process.

Talent Management and Strategic Human Resource Management

Strategic human resource management is put in place to help the company meet the needs of its workers, while at the same time striving to realize the objective of the company. The human resource department is critical in dealing with all the aspects of employees. This includes hiring and dismissals or workers, training, as well as administration. In addition, the human resource department can provide motivational tools to their workers, safety information, and vacation days, among others. Strategic human resource management looks at the future needs of the workers and endeavors to fulfill the organizational requirements of labor in a practical manner (Silzer & Dowell, 2009).

Modern organizations require a forward thinking human resource management because of increased competition in the global market arena. It requires managers to think ahead in a way that meets the expectations of the employees, as well as aspirations of the company. If the needs of the workers are catered for, then they will work hard to meet the expectations of the company and those of the shareholders. This requires a change in the way the human resource department manages its workers.

Organizations must work extremely hard to meet the needs of their workers. This can be achieved by creating a condusive working environment, and the human resource department can achieve this function. Being able to determine the needs of the employees can help determine the type of workers that a company will require. Strategic human resource can also help in reducing the money that a company uses in hiring workers by ensuring the best worker are hired and retained.

Strategic human resource management is useful in all companies. In a small organization, it might require the manager taking some of his or her time to review how worker are getting on with their work (Burman, Bowman & West, 2009). On the other hand, large firm have specialized department dedicated to the management of workers. By managing the workforce in a manner that benefits the whole organization, it is possible to meet the needs of the employees themselves (Burman, Bowman & West, 2009). Indeed, it is worthy the effort for a company to see that workers have the right tools and information to execute their responsibilities.

In this analysis, it might seem that strategic human resource management and talent management can be sued interchangeably because of their overall focus. However, talent management goes further beyond the strategic human resources approach. Indeed, TM is used to re-package the traditional roles of management (selection, staffing, and developing talent) or to put emphasis on the needs to respond to demographic changes within an organization.

Another point of difference is that traditional human resource practices operate using a functional model (Burman, Bowman & West, 2009). This means every unit in the human resource department works independently. Indeed, the goals, measures, and budgets of each unit are relatively different. Although this separation or isolation allows each department to focus on its specialty, this can be a big impediment to achieving the goals of the organization in a unified way. For instance, it might affect the recruiting efforts if it does not meet the needs of other people. In Addition, TM focuses on integrating traditional management processes. It starts by understanding that the management of talent is an indispensable component in achieving the desired results. Moreover, talent management is superior to strategic human resource management because it is proactive. By being proactive, is possible to overcome the traditional problem of recruiting, such as isolation. In the traditional method of managing human resources, several aspects such as recruiting have been isolated from other functions like staffing, planning, and redeployment. However, talent management puts all the functions together and forms a continuous process that is executed by the human resources department.

National Cultures and Talent Management

Natural cultures are critical in virtually every aspect of management. As companies cross borders in search for new markets, they have to find a common ground in terms of adaptation to the local conditions, besides providing good and services that are standard in the global competitive market. This balance often has a big impact on the human resources department. Because of this understanding, cultural orientations among the different countries become an important factor for human resource managers to consider (Slizer & Dowel, 2009, Bamber & Blanpain, 2010). According to Hofstede (2001), companies must adjust to the local cultural and ethical inclinations of the host countries if they expect to reap the full benefits of the market. Indeed, subsidiaries that consider culture tend to perform better than those that neglect this important parameter.

National culture is crucial in talent management. According to Ma & Allen (2009), theories that delve on national cultural values provide a valuable insight and understanding of recruitment and management of workers within a firm. Previous research on this aspect also gives credence to the assertion that cultural values have a significant impact on human resource practices including the selection, compensation, as well as turnover (Kamoche, 2004). In summary, culture is important for researchers and practitioners in the global market arena as it plays a key role in the success or failure of a business enterprise.

Cross-cultural differences definitely have a significant effect on the international resourcing and retention of talent within the organization as companies move out in search for markets across natural borders (Burman, Bowman & West, 2009). In the foreign markets, companies must study the culture of the host country in order to maximize its potential in the market. Different culture put emphasis on different attributes while looking for employees. In addition, diverse cultures have different belief in their assessment models while recruiting workers. For instance, in Belgium, there is more reliance on tests than what happen in the UK (Millward, 2005) Moreover, recruitment practices in countries like Greece are generally less structured in their approach. In the US, employers are more prone to use integrity testing in their hiring process. It is imperative, to look at the local culture for companies that tend to use standardization in their hiring process. This is because locals might react negatively to a company that does not align to their cultural beliefs (Millward, 2005).

Ward, et al (2012), contend that managers should consider the thinking patterns and reasoning in different cultures when examining the influence that culture has on human resource managements as well as talent management. In essence, there are significant competencies that recruiters use to gauge the cultural needs, as well as the necessary adaptive measures that multinational need to work in a given locality. The competency parameters include teamwork, strategic vision, adaptability, drive for results, and competence, among others. These factors help managers to predict the likely scenarios in different national perspectives. In case there are different cultural contexts, then the managers modify these factors to minimize any dysfunction in the given market.

National cultures are not the main factors that affect management practices in most organizations. Human resource management is also affected significantly by several factors including the nature of the workforce, competitors present at that time, organizational culture, as well as the history of the company (Kumar, 2010). For instance, creating a common ground for a diverse workforce can be intriguing for the human resource manager, since traditional forms of human resource management do not have room for diversity. According to Kumar, traditional human resource system only allow fro similarity not diversity (Kumar, 2010).Therefore, it is paramount that these issues are also considered even before a company decides to initiate cultural changes (Burman, Bowman & West, 2009). Assessments can be conducted through surveys, observations, in-house research to identify those aspects that require change. It is after this evaluation that the management can effectively decide and design the change process within the organization. Indeed, through this approach, a company will be in a position to maintain employee integrity and ensure job security

Conclusion

Talent management might fairly be a new terminology in many organizations. However, its efficacy delves deep into the core of every business function. However, the Human resources department is a traditional management function that is resistant to change. This means even the recruiters do not embrace any change as quickly as might be expected. This is a challenge for companies as they seek for market across their natural borders. Indeed, many companies are going global, meaning that human resource managers must ‘fit’ into the local condition in order to harness the full benefits in the host countries.

 

This section of the essay has delved on the aspect of talent management in contemporary business practices. Although the concept is new in most business segments, it is indeed, the latest trend in the management of human resources. The main areas of differences between talent management and strategic human resource management have been highlighted. Specifically, talent management looks at what talents the organization will require in the future. It works towards getting this talent and maintaining it within the organization. However, strategic human resource management is functional in nature, departing the core functions into distinct units. Moreover, an attempt has been made to articulate the role that culture plays in the global marketing arena. Indeed, evidence shows that multinational have different approaches when it comes to the management of labor in different countries. Since cultures across many countries are significantly different, it is prudent that multinational tailor their policies to meet local conditions. As highlighted above, some cultures can hinder the operations of a company, while others are open to manipulation or change by the multinational companies.

Businesses are currently thinking global because of increased competition and the opportunities provided by globalization of world economies. Indeed, the business arena has become progressively more complicated and volatile. Accordingly, the greatest challenge facing most companies is how they can exploit the advantages of globalization, while at the same time managing human capital across diverse cultures. This is a critical component if a company expects to realize benefits in different parts of the world.

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