How HRM is failing in these organizations, their staffs and other stakeholders?

7 Eleven 7 Eleven is a multibillion dollar convenient store empire that has about 620 stores in Australia, making profits of 120 million dollars every year (7eleven.com.au 2018). The HRM also failed as an Ethical and Credible Activist, being unable to show understanding and care for the exploited workers, a lack of courage to stand against the malpractice, and unable to influence the management and ownership to change these practices.

Running head: Human Resource Management
Human Resource Management
-Case Studies
Name of the Student
Name of the University
Author Note

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Contents
How is HRM failing in these organizations, their staffs and other stakeholders?.....................2
1. 7 Eleven...........................................................................................................................2
2. Country Fire Authority....................................................................................................3
3. Banks...............................................................................................................................4
Recommendations I would make to enable HRM to effectively resolve the problems that are
evident in these organizations....................................................................................................5
1. 7 Eleven..........................................................................................................................5
2. Country Fire Authority:...................................................................................................6
3. Banking:..........................................................................................................................7
According to the AHRI HRM model, how could the organizations avoided these situations?.7
1. 7 Eleven:..........................................................................................................................8
2. Country Fire Authority:...................................................................................................8
3. Banking:..........................................................................................................................9
References:...............................................................................................................................11

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How is HRM failing in these organizations, their staffs and other stakeholders?
1. 7 Eleven
7 Eleven is a multibillion dollar convenient store empire that has about 620 stores in
Australia, making profits of 120 million dollars every year (7eleven.com.au 2018). The
founder and owner of the industry, Russ Withers is holds a 1.3 billion dollar empire and owns
property worth millions (Forbes.com 2018). However the industry is built on a business
model that exploits its employees, especially the most vulnerable sections of the society, like
cash strapped students (mostly international students), visa holders and many aspiring
Australian citizens. The organization is involved in a widespread wage scandal that is seen in
most of the franchisee, where the workers are grossly underpaid, or not paid at all, and
employee records being forged and employees being blackmailed (Ferguson 2015a; Alden
2015). When the head office was contacted, informing them about how the workers in their
franchisee stores are being exploited and underpaid, they were quite dismissive, and did not
show any interest in any evidence that the caller had to prove those claims. When the wage
scam became public, the management declared that they will establish an independent panel
to enquire these allegations, with unclear details being given about the panel (abc.net.au
2015). This shows how the HRM of the organization failed at various levels, which allowed
the scam to continue in the organization. The organization’s HRM failed as an Ethical and
Credible Activist, being unable to show understanding and care for the exploited workers, a
lack of courage to stand against the malpractice, and unable to influence the management and
ownership to change these practices. The HRM also failed as an expert practitioner, being
unable to resolve the wage issue or collaborate with independent activists and reporters to get
tom the root of the issue, instead of discrediting them. The HRM thus also failed to act as the
stakeholder mentor and to act as the ladder for culture and change, since the organization

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continued their culture of exploitation, showing no intention to change these practices
(Ferguson 2017; Ahri.com.au 2018).
2. Country Fire Authority
Country Fire Authority (CFA) is a fire service centre based in Victoria, Australia,
providing fire fighting and emergency services to aural Victoria and some of the outer
suburban areas of Melbourne (cfa.vic.gov.au, 2018). Reports were made against CFA on
sexual harassment and assault against the female employees and volunteer workers, which
was found to be an ‘endemic’ problem in the organization (McKenzie and Baker 2017). Even
the reporters were harassed while covering the problem (Taylor 2017). The work culture is
said to perpetuate a system of no transparency and unaccountability, which meant that the
workers felt they can get away with anything. Reports from Interim Report on Gender
Diversity and Inclusion also showed that almost half of the female and male employees in the
organization faced bullying, and almost one third were harassed (including sexual
harassment). Other reports have also shown evidence of employees engaging in heavy
drinking, and bullying and assaulting some female employees or volunteers, while the captain
of the department failed to intervene (Bowden 2018; McKenzie and Baker 2017; Edwards
2017). This shows a failure of the management to maintain an environment of safety and
wellbeing in the work premises, and fostering a system of bullying, and misuse of authority.
The HRM thus failed to act as a Ladder to culture and change, an effective designer of
workforce and workplace and as a mentor and coach for stakeholders. An environment that is
felt as unsafe for the employees and other individuals working with or for the organization
affects the work culture, and also affects the professional code of conduct within the
organization. The HRM also was unable to show understanding and care for the affected
individuals, and resolve the issues surrounding the harassment of the employees and

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volunteers, and influence the leadership to maintain a professional code of conduct and
ensure accountability at all levels of the hierarchy (Ahri.com.au 2018).
3. Banks
The Banking industry also faced public displeasure, with accounts of how the banks have
been systematically exploiting their consumers. The Banks were found to be ‘ripping off’
their customer’s by increasing the rate of interest to both new and existing loans, costing the
taxpayers up to 500 million dollars every year. Also, due to the domination of the banking
market by the four big financial organization meant that the bank levy of 6.2 billion dollars
were planned to be covered through the expenses of the customers, as a result they ended up
paying more to the bank for the same services. The investigative commission that was
engaged to study the methodical exploitation of the customers pointed out that the four pillars
of banking stability was considered an ad hoc policy, which was redundant, and thus
overlooked by the management. They considered the loyalty of their customers as the perfect
scope for exploitation. The mortgage brokers also were providing inaccurate information
despite earning healthy commissions (Ferguson 2017b; Schneiders and Millar 2015). This
showed how the HRMJ failed their key stakeholders, the customers, and allowed the
management and ownership of the organization to capitalize on the trust of the customer base
to increase the profits. This systematic exploitation was also caused an unsustainable growth
in the organization, without showing orientation towards the sustenance of the future market.
The HRM was also unable to influence the management and ownership against the
systematic exploitation, and show courage to stand up against the practice. The HRM was
also unable to collaborate with the key agencies to allow these practices to be reported and
being stopped, instead of enabling it to continue. This also affected the credibility of the
management as well as the organization after the reports of exploitation came to public
enquiry, and thus eroded the public trust. It was thus a professional failure of the HRM, as it

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failed to consider the interests of the most important part of the organization, the customers.
Thus it was evident that the HRM was not an expert practitioner, business driven, strategic
planning and ethical/ credible activist (Ahri.com.au 2018).
Recommendations I would make to enable HRM to effectively resolve the problems that
are evident in these organizations.
With an understanding on how the HRM failed in the organizations reviewed in the case
studies, there are a few recommendations I would like to make to resolve the problems faced
by the organization, its employees and the stakeholders.
1. 7 Eleven
For a convenient store giant like 7 eleven, which has more than 600 retail franchisees
across Australia, it is important to ensure that the HR management pays focus on employee
feedbacks. The HRM can also focus on the policies outlined by the national labour laws and
worker health and safety policies. At the managerial and leadership levels, the HRM can
ensure that the policies are complied with across all the stores, and any non-compliance is
promptly reported and addressed. They can act as vital resources of information for the
organization, informing the ethical code of practice and ensuring all employees are paid as
per the contract and following the national guidelines. Focus should also be made on students
visa holders, who are at the highest risks of being exploited, and ensure that their concerns
and wellbeing are addressed. The Wage scam showed that most of the employees in the
franchisee are either underpaid or not paid at all, and that the company indulges in fraudulent
documentation to cover up the malpractice, and also uses blackmailing strategies to prevent
employees to report the authorities against this malpractice. This raises a serious concern for
the HRM, to ensure that all form of documentation for employees are done correctly,
showing the actual pay each employee is entitled to, and are not blackmailed or pressurized in

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any way. This can be achieved through building the employee relation, which can bridge the
gap between the management and its employees, and facilitate the workers to raise concern
when needed (Cohen 2017; Jamali et al. 2015).
2. Country Fire Authority:
To solve the problems of harassment and assault on employees and volunteer workers in
CFA, I would recommend that the HRM instils a code of conduct, and ensures such codes are
adhered to at all levels. It is important that every employee and workers are held accountable
for their actions, and any misconduct be promptly be addressed and any miscreants be
penalized. It is important to understand that the incidents of harassment and assault reflects
upon a lack of safety and positive work environment in the organization, while the inability
of the leaders to intervene such acts shows their complacence towards these issues. Acts like
bullying, harassment and assault should be monitored vigorously and investigated promptly
by the HRM, and also reported on time. I would also ensure any complaints and reports on
such incidents are being relayed to the upper management, and preventative measures be
recommended to ensure its inclusion in the organizational policies. A culture of
accountability, equality, safety, positivity and productivity is vital to ensure that no employee
feels unsafe and unsecure in the working environment. The HRM can also ensure
transparency in the working environment, educating and training the workers on whom to
approach in the incident of bullying, harassment and assault to themselves or others around
them (Astrauskaite et al. 2015). Moreover training the employees about the legal obligations
each has to maintain a professional code of conduct should be properly emphasized, along
with the importance of accountability, and outlining the penalties that can be imposed on any
employee found to be breaking them. The HRM can also make it clear, that no one in the
organization is exempt from following these code of practice, and everyone have to uphold
them at all times (Rodriguez and Stewart 2017; McDonald et al 2015).

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3. Banking:
For the Australian Banking sector, I would recommend that the HRM should focus on the
stakeholders, instead of increasing the profits of the organization. It is vital to understand that
the customers and their loyalty are vital for sustained growth of any organization, and the
banking sector is not exception to that. Thus, exploiting the loyalty of the customers, to
impose hidden expenses and increasing the interest they need to pay for new and also existing
loans is a non-sustainable strategy, which can eventually lead to the erosion of trust from the
sector (Coleman 2016). Also, making the customers liable to pay for the deficits of the bank,
and misleading the customers in financial matters can also have serious implications for the
national finance system. The HRM can stop such practice, by representing the best interests
of the stakeholders and customers affected by the banking decisions (Methorst 2017). The
HRM can act as the voice of the public relation or customer relation, ensuring the customers
are not exploited for company’s gain. Moreover, it is also important to ensure that the
employees are also not exploited in any manner or pressurized to act in certain ways to
maintain the fraudulent status quo. Instead, a sense of corporate responsibility and customer
centric ethics should be highlighted and practiced (Clair and Milliman 2017).
According to the AHRI HRM model, how could the organizations avoided these
situations?
The AHRI FRM model of Excellence outlines how organizational capability can be
developed through the interaction of various factors working at different levels, to ensure a
positive workforce and workplace, benefit for stakeholders, and developing a culture of
productivity and excellence. The model provides valuable insights as to the steps that can be
taken by the HRM of the discussed organization to avoid the problems that have been
plaguing these organizations.

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1. 7 Eleven:
The problem at 7 eleven stems from the complacency of the head office towards their
responsibilities, and hiding the inherent business model used by the organization that allows
systematic exploitation of its employees. The HRM can act as a critical thinker and enquirer
into the reports of employees being underpaid or not paid at all, studying the payrolls and
trying to identify any discrepancies. They can also identity solutions on how the
discrepancies can be addressed, and raise concerns in the upper management of the
malpractice. Such action can also be future oriented, ensuring the long term well being of the
employees and of the employee relations, and thus the long term sustainability. The HRM can
also help to influence the ownership and upper management to adhere to their legal
obligations, representing the welfare of the workers, fighting courageously if needed against
the upper management. This is important since reports have suggested that the Head Office
was well aware of the malpractice happening in their franchisee. Developing an
understanding, empathy and care for the exploited workers can enable the HRM to
comprehend the disadvantages they face regularly for being underpaid, as well as bring to
halt the process of blackmailing the employees. Moreover, collaborating with independent
reporters and government authorities to report any legal non compliance and malpractice can
also help to prevent its occurrence. Interacting with the employees, and understanding their
concerns, grief’s and stories, can also help the HRM to find resolutions for those problems,
and help to maintain a professional environment in the workforce (Ahri.com.au 2018).
2. Country Fire Authority:
The problem in CFA stems from the employees who have shown major disregard to the
professional code of conduct. It is important therefore that proper workforce and workplace
design be implemented, in order to ensure all workers understand their professional duties

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and are able to maintain a professional code of conduct. Acts of bullying, harassment and
assault puts the well being of the employee in serious jeopardy, and thus is a loss to the
organization. It is important to ensure that the HRM can function as an expert practitioner
(preventing the unprofessional acts by some employees and holding them responsible for
their actions, acts as collaborators between employees who experienced these disadvantages
and with governing bodies on professional code of conduct. Also, the HRM can act as an
ethical and credible activist, by understanding the problems faced by the employees, act
courageously to intervene in such matters and influence other to maintain a culture of safety
and professionalism in the organization. As a strategic architect, the HRM can also outline
solutions to the given problem, ensure they are maintained at all levels of the organizational
hierarchy. Orienting the employees towards the organizational objectives and context can
also help to emphasize on the policies that focuses on maintaining the well being of all
employees and workers associated with the organization and how an unprofessional
environment created by bullying, harassment and assault can jeopardize that and delineate the
workforce from the organizational policies and objectives (Ahri.com.au 2018).
3. Banking:
The problem at the Banking Sector also is due to an attitude towards the systematic
exploitation. However, in this scenario, the exploitation is primarily focused on the customers
and not the employees.; while the employees are being paid handsomely through the
commissions in sales and from profits, the customers are being exploited in plain sight. The
HRM can ensure that the business is conducted in an ethical and responsible manner, and
does not depend on exploitation of people to make profits. Through enquiries and critical
thinking, the HRM can identify any malpractice and acts of exploitation of customers.
Considering that the satisfaction of the customers and their well being ensures the future of
the organization, the HRM can ensure sustainable development through incorporating a sense

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of responsibility towards them. This can also help to foster an ethic practice in the system,
and prevent the public trust from being eroded. It is important to consider that many of the
customers seek banking help in dire need situations, and as such it is unethical and
irresponsible to capitali8se on their predicament to amass more money. Collaborating with
authoritative and governing bodies as well as independent reporters can help to ensure that
practices of systematic exploitation does not remain unknown top the stakeholders, the public
and the government, and that can act as a significant discouragement towards the
maintenance of such malpractice (Ahri.com.au 2018).

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