MANAGING HUMAN CAPITAL AND LEADERSHIP INTRODUCTION

The Harvard model6 The Guest model 7 The Warwick model7 Human resource development of fombrun model 8 Task 28 How to improve recruitment and selection process8 Recruitment 8 Process of recruitment 8 Selection process for O2 9 Improving selection process 11 TASK 311 Approach to HRD and how this could be improved. 11 TASK 412 CLASSICAL THEORY OF MOTIVATION-12 TASK 513 Characteristics of effective leaders and its analysis:13 CONCLUSION 16 REFERENCES 17 INTRODUCTION HRM is a

MANAGING HUMAN
CAPITAL AND LEADERSHIP

Table of Contents
INTRODUCTION...........................................................................................................................5
Task 1 ..............................................................................................................................................5
1. The fombrun model............................................................................................................6
2. The Harvard model ............................................................................................................6
The Guest model ....................................................................................................................7
The Warwick model...............................................................................................................7
Human resource development of fombrun model.................................................................8
Task 2...............................................................................................................................................8
How to improve recruitment and selection process...............................................................8
Recruitment............................................................................................................................8
Process of recruitment............................................................................................................8
Selection process for O2.........................................................................................................9
Improving selection process.................................................................................................11
TASK 3..........................................................................................................................................11
Approach to HRD and how this could be improved............................................................11
TASK 4..........................................................................................................................................12
CLASSICAL THEORY OF MOTIVATION-.....................................................................12
TASK 5..........................................................................................................................................13
Characteristics of effective leaders and its analysis:............................................................13
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................17

INTRODUCTION
HRM is a model which contains all resources of human activities. When all these
activities are fired effectively, then willing workforce helps to achieve organisational goals.
HRM explains economic, political, technological, legal and organizational conditions. Human
resource management is the process to help managers to recruit, train, select and develop all
employees of the organization.
O2 is a telecommunication service provider in United Kingdom and it is owned by
Spanish multinational Telefonica company and its headquarter is located in Slough, Berkshire,
England, United Kingdom. O2 is the 2nd biggest mobile network operator in United Kingdom.
Company was formed in 1985 and the founder of this company is John Carrington. Telefonica
retained the O2 brand and the headquarters of company in United Kingdom.
In the below paragraph there is a discussion of managing human capital and leadership.
The 1st thing which is mentioned above is about models of Human resource of management and
how they approach the company to manage its human resource. After that there is discussion of
recruitment and selection related to strategic human resource and how we can improve them.
Approach of HRD and how they should be improved this process. Then there are theories of
motivation and their characteristics which can be applied to company. And at last discussion of
effective leaders and models to analyse.
Task 1
This will explain features of HRM which are known as models. All these models gives analytical
framework for the study of HRM. Four common models are:
 The Fombrun model.
 The Harvard model.
 The Guest model.
 The Warwick model.
Purpose of all these models are just want to provide analytical framework for the study of HRM
for example stakeholders, situational factors, competence etc. These models provide speciality to
HRM practices. They provide a design of HRM that setup variables and relationship to
researched. They help the world to discover and understand them about the significance of
nature and explain them the key practices of HR.
1

1. The fombrun model
Fombrun is a model of HRM. It also has 4 functions for management and which are appraisal,
selection, development and rewards. It is not complete model because its just focuses on its four
functions and don't give importance to other contingency and environmental factors. But the
advantage of this model is that it is easy and can easily serve framework for explaining
significance and nature of HR activities.
Some approaches or parts which come under fombrun model are selsection, human resource
development, appraisal, organizational effectiveness and rewards.
2. The Harvard model
This model allows multiple stakeholders' existence within the organization. And with these
stakeholders, shareholders are also included with various groups of workers, government and
then its community will be at large. This models weight more on the soft side of HRM. This
model have main components of HRM which are stakeholder interests, situational factors,
human resource management, human resource outcomes, HRM policy choices and long term
consequences.
 HR strategy- They look for influencing employees. Resource of human flows and reward
system to motivate employees and work system should be proper.
 HR outcomes- commitment of employees are important. It includes congruence and
competence and it is cost effective.
 Stakeholder interests- shareholders have a big role they are included and management
should be proper look for employees welfare government and community matters a lot.
 Situational factors- under this they will decide business strategy and condition of
management and the market and the task and technologies which are used and the laws
and social values.
 Long term consequences- Look for individual welfare and then organisational
effectiveness.
The Guest model
This model was created by David guest in 1997.This model underline on the assumptions that
they begin with specific strategies of HR manager, which demands so many certain practices and
when they mixed then they will result in outcomes. These outcomes have behaviour performance
2

and financial rewards and the six components of this model is HRM strategies, HRM practices,
HR outcomes, behavioural outcomes' performance outcomes and financial outcomes.
HRM strategies after that practices comes under this and process of hiring, training,
compensation and relations are included. HR outcomes included commitment, quality and
flexibility. Then the outcomes of behaviour like motivation, cooperation and organizational
citizenship. Performance outcomes which will be positive and under positive the productivity,
innovations of different products and the quality of products matters and in negative impact low
productivity put negative impact absenteeism and turnover also put bad effects. Last point of this
model is financial outcomes and under this they have to look for profit and ROI.
The Warwick model
The Warwick model was created by two researchers which are Hendry and Pettigrew. The
Warwick has also five elements like other human resource models and these five models are:
Outer context which is also known as macro environmental forces after that inner context which
means micro environmental forces. Business strategy content, HRM context and HRM content
included in this model. The main strength of Warwick model is that it identifies and allocate
main environment influences of HRM. This model takes attention of strategies and HR practices
of business through the internal and external content in which all activities takes place which
includes all transactions between in both external and internal content. The factors represent or
want to describe there elements like outer content shows social, economic, political, legal and
competitive and then it will be directed to inner content which represent culture, structure,
leadership task, technology and business output. Then these will be forwarded to business
strategy and HRM content which both includes objectives, product market, strategy and tactics
and HRM has roles, definitions and HR outputs. At last HRM content which looks for HR flows
and work system for company then provide reward system and improve relation with employer.
Human resource development of fombrun model
O2 is investing in expert development for their staff that will lead to satisfaction to job or
provide greater job satisfaction. 42% of employees are agreed that professional development is
the important need to their job satisfaction. O2 looks for their staff education because company
have to care about their careers because when our employees are satisfied or feel great with the
workplace and if they realize that company have care about their development, then they will be
3

more satisfied with their work and jobs. If O2 can invest in employee development that will help
to grow your employee engagement. By providing career opportunities to our staff and invest in
their development, gives them a reason to engaged at work.
Task 2
How to improve recruitment and selection process
Recruitment
Recruitment is hiring potential people into the organization at a vacant post. It is the root
function of human resource. It is the process of choosing correct person for the right post at right
time. To meet the organization requirements company can attract, select and appoint potential
person. Taking of people into the organization is done by internal or external source.
Process of recruitment
It is just attracting and finding potential resource for the available position in the
organization. Find candidates with attitude and abilities which are perfect for achieving the goals
of the company. In short it is just identify available positions, analyse requirements, reviewing of
applications, short-listing and then select the right candidate.
.
Step 1- Before there is an announcement for particular position the director of HR at O2
headquarters accomplish the following documents for begin the recruitment.
Step 2- The HR department announce the position and draft advertisements. Whole job
description is spread to so many agencies, organizations and universities. Advertisement expense
cost should be bear by hiring unit.
Step 3- Advertising is the outdistancing source to build so many candidates. Print media-
Newspapers through local or national state. Other- journals/magazines. Other media- television,
radio and websites. Decision will be taken that through which media will be used and how to
design the advertisements to target suitable candidates.
Step 4- when O2 receive complete resume they will begin the review process. Candidates will be
rejected or selected depends on their experience and qualifications in the field of management
and engineering. Principle of selection is decided before the real screening takes place. Once if
O2 is done with principle of the experience and the performance. Hiring department takes
interviews of at least three candidates.
4

Step 5- Taking face to face interviews. The interview carries some questions that are related to
the job. Forms of evaluation have to be filled by interviewing panel members for each candidate
who has given an interview and form will be submitted to the HR department.
3-4 rounds of interview should be taken of every candidate, that is if O2 is satisfied with
candidates resumes they have given to them. Candidates will get to know about their interviews
after 3-4 weeks. 1st interview will be a group interview. During this interview O2 members will
ask every candidate about social questions. During this interview candidates should act like both
even a O2 employee or even a customer. If candidate will clear the 1st interview, then members
will look for background. Candidates get phone calls if they had clear the 1st interview and they
will ask about their opinion on O2 and about interest in job position. They will call them and ask
about their past incidents and ask they how they will overcome it and this interview should be
taken by store manager one on one. The questions which are going to ask in 3rd interview are the
combination of interview 1 and 2. O2 general manager will take your interview one on one and
ask about your past experiences and ask how to handle such situations. The rejected candidates
will get to know about their rejection through emails or phone numbers. The last process is
reference check before offer will be made to selected candidates the hiring manager check the
references.
Selection process for O2
1. There are two parts which are Aptitude and logical reasoning and technical paper has
been made for candidates which contains so many questions. After clearing that paper
there will be one more test for 1 hour and questions are related to C, C++, Java structure
and operating system.
2. After that technical interview the third round will be held and it is for 45 minutes for
every candidate and the questions are based on JAVA and mathematical puzzles.
3. Now HR round in which HR will take 10-15 minutes of candidate and ask some general
basic questions and want to know about there capabilities and there interest in the work.
4. Compensation policy will be decided by compensation committee and compensation is
given without any discrimination and it will be given on the performance of candidate
and based on their skills, position and education.
5

5. Candidates who looks not able are systematically rejected because if you are selecting
employees who don't have any vision for there company then they are future enemies for
our company.
6. Candidates are chosen for their eagerness and ability to create constant, moderately for
their technical qualification.
Issues facing in recruiting process
1. They are not clear with their thoughts that what they are hiring sometimes some
candidates should be a bad debt for the company.
2. Getting problems in finding better employees and everyone who is not capable for the job
is trying to apply for a specific position.
3. They are not clear with the employees' communication language and other employees are
getting problems in understanding.
Improving recruiting process
1. Clear about their roles which you are hiring.
2. Advertise your company.
3. Language should be clear in understanding.
Issues in selection process
1. Some good employees are not doing work in the organization because of low payments
are given to them.
2. Jobs ads are not reaching to the capable candidates and there is lack of advertisements
posting to the various websites.
3. O2 is selecting employees on the basis of their education and some skills but there is a
risk of leaving the company this is the major issue for the company.
Improving selection process
1. Can offer an attractive salary to the best candidates.
2. Post description of jobs on different websites and advertise them.
3. Only select that employees who will work in the company for a long time.
6

TASK 3
Approach to HRD and how this could be improved.
Human resource development (HRD) is method of developing people through training in
an organization. HRD approach system is used to develop people in short period which helps the
management of company (Fayolle and Gailly, 2015) It is also known as process of developing
the skills, capabilities and knowledge of employees in organization. O2 a
telecommunications service provider uses different approaches to enhance the capability of its
employees like using Integrative framework approach in which it focuses on whole human
resource development system by providing them good training and by motivating them. This
approach enhances building organizational capabilities, and also help in improving satisfaction
of employees. Employees are assets of any organization and when they are satisfied with their
work it also improves effectiveness of organisation.
O2 also uses Traditional HRD approach in its organization in which there is friendly
environment created in organization so that employees are free to share all the things with their
superiors. Human resource development is an important factor because when individual sees
growth or development in particulars life. Then they start doing work with full motivation. One
more approach that O2 follows is HRD score card approach which create a connection
between companies business targets and HR operations. Approach says that HRD intervene for
creating right business effect in terms of HRD competencies, business linkages and culture.
Human capital appraisal approach is one of the best approach used by firm O2 in this
there are five stages clarification stage, assessment stage, design stage, implementation stage and
monitoring stage, this all stage are used for the development of human resource. O2 also use
some basic approaches which are termed as Soft HRM and Hard HRM. Soft HRM is to provide
opportunity to the staff members for their development. To provide them opportunity company
provide them training, internal promotion and flatter organizational structure. Hard HRM consist
of controlled mechanism in which there are judgmental appraisals, and centralized decision
making. This all approaches play a particular role in a firm (Storey, 2016) This all approaches of
HRD is implemented for achieving organizational goals.
O2 is working on improvement of Human resource by using different and new approach.
It is started giving good incentives to employees on their performance, like supervisors has give
7

some work to their subordinates and if they perform well for that task then there will be rewards
given to them. And it also started providing training for employees to improves skills of
employees, when skills are improved then it also improves opportunity for employees, other
thing which is started are like providing good culture to them in which they feel safe and
satisfied with their firm and making system centralize, create fair opportunity for employees,
working in formal manner provide better hierarchy of work, it creates link of top to middle and
middle to lower level. As a telecommunication company it has to provide health safety also to
their employees. HRD needs time to time improvement, so that firm will able to keep talented
employees with them and helps in development of both employees and organization as well.
TASK 4
CLASSICAL THEORY OF MOTIVATION-
HERZBERG'S TWO FACTOR THEORY OF MOTIVATION-
1) Hygiene Factors- These are those factors which are essential for motivation at work
though they do not lead to satisfaction for long. If these factors are not there at
workplace, then internal environment of an organization will break and work won't be
completed efficiently. In order for O2 to survive long in the market they need to address
these factors if they don't exist then it leads to dissatisfaction among employees. This
factor concerns job environment scenario. It demands physiological needs which needs to
be addressed or will lead to deviations in the organization. Factors which needed to be
keep in mind are-
Pay- The salary structure in O2 must be satisfactory and fair so that one doesn't feel
unfair and low in the organization. They should keep it equal according to the designation and
department.
Company policies and Administrative policies- The policies of the company must be fair,
flexible and clear. Company must schedule working hours that are flexible, dress code, holiday,
bonuses, breaks etc. these norms shouldn't have to be too rigid.
Fringe benefits- The employees of the company should always offer healthcare plans and
if possible cover for the family members too.
Physical working conditions- In order to work efficiently O2 should keep its organization
safe, hygienic and clean. Equipment in the office must be up to date and in good condition.
Status- The employee should be respective to all irrespective of its designation.
8

Job security- O2 must offer security of job.
2) Motivational factors- These factors cannot be considered as motivators. Unlike hygiene
factors they bring positive satisfaction which results in superior performance
(Venkataraman, 2019). O2 must follow up and implicate these factors to survive for long
in the market, to get good performance and to keep the employees satisfied in every way
possible. Factors which need to be keep in mind are-
Recognition- O2 should praise and their employees must be recognized for their reward
winning accomplishments by their management.
Sense of achievement- Employees of 02 must have this sense or feel in them.
Growth and promotional opportunities- O2 should keep in mind these opportunities to
motivate the personnel.
Responsibility- The employees must be disciplined and responsible, should retain the
accountability and ownership of the work.
Meaningfulness of the work- O2 should keep it interesting and meaningful so that employees
does not lose their dedication to work.
TASK 5
Characteristics of effective leaders and its analysis:
Leadership:
It is art of encouraging people by making them active to achieve a common goal. Leadership can
also be explained as a way of motivating bunch of people towards their goal.
Models of leadership
Situational leadership :
Situational leadership can be understand by picking up “Situational” it means condition
and situation leadership means to change leadership style according to the condition (Cooper,
2017). There are different situations' comes in daily life and to deal with this situation leader has
to change its way of leadership for example O2 company is facing some bad situation with its
employees and leader is unable to handle this situation with old style of leadership then leader
should change his way of leading others.
Situational leadership
9

There are different type of situational leadership:
 Telling – In this type of situational leadership in which leader is of directive behaviour
and does not listen to others just give orders to them. In this power of decision making is
in one hand only.
 Selling – In this style leader is having very directive behaviour and also supportive
behaviour. In this power of decision making is in hand of leader but he also support his
employees as well.
 Participating – In Participating style leader is more in supportive behaviour as compare to
directive behaviour. In this he used style by making friendly behaviour with his followers
and provide them freedom of sharing their ideas.
 Delegating – In delegating behaviour leader is low in both behaviour. In this he neither
plays' role of directive nor of supportive behaviour.
Situational leadership is that leadership which consist all the factors of effective leadership
because a leader who can change style of leadership according to different situation than he can
be defined as an effective leadership.
Characteristics of effective leaders and its models.
Effective leaders contain lots of quality which makes them a great leader.
Some characteristics are as follows:
 Good communicator – Leader is always a good communicator. Leader is one who bring
people in support of him and the main thing which attracts people to follow leader is his
communication power.
 Good listener – A leader is always a good listener. If leader always speak and do not
listen than it will impact badly on others and other will stop following him which do not
make an effective leader. For example, O2 leaders wants to bring investors to invest in
company then they must be a good communicator so that investors will attract from their
way of presenting themselves.
 Achiever – Achiever is one who is always ready for achieving something new. Leader
always want something great to achieve. Achievement is passion for leader. For example,
10

O2 leaders wants to achieve new heights in market and they are pushing them with full
energy then they will achieve their goal one day.
 Motivator – Leader never become great leader if unable to motivate others. Because
everybody who is following any leader want some motivation from his leader, otherwise
one day they will unfollow him. O2's HR team who plays a role of leader to its
employees so to motivate them they must motivate them by talking with them politely
and giving them opportunity and making them part of decision making.
 Supporter – Leader is one who support his follower. Followers are people who follow
leader to get something in return, if they are not getting anything they will stop following
their leader one day (Zhang and Cueto, 2017) For example if Leader of O2 will not
support his employees on their bad time or will not appraise them for their hard work
then they will stop following his order or may resign from job as well.
 Mentor – Mentor is leader's main quality because leader is a person who influences others
life. Followers are persons which go after their leader and this thing becomes an
influencer thing for them. Mentor plays role of life change in others life.
 Creative – Leader always have some unique things in them. They do things with some
creativity which make them different from others (Kirzner, 2015). Creative mind set
leads to something great.
 Hard worker – The most important factor or quality of leader is that they are hard worker
and they are the one who struggled a lot and they never give up whatever situation they
face they always stand still. Hard work always gives good result.
 Good learner - All leaders are first learners, without learning things or we can say without
having any knowledge no one can become leader. Leaders can motivate other if they
have something to motivate because knowledge creates a value, if there is not knowledge
then no leader can make other follow them.
 Decision making – Leader is a person who is a great decision maker by using his creative
mind and other positive things. Decision making is very crucial in an organizational
world because it consists high risk with it one wrong decision can make a huge loss and
11

one right decision can make a huge profit so a leader with a quality of good decision
making can create a great impact on organization (Burns, 2016).
Things which O2 company can improve after finding limitation of Herzbergs two-factor
theory are like do not ignore situational variables, this theory mainly give focus to satisfaction
which indirectly ignores productivity (Nabi and et.al., 2017). As it ignores main points like
situational and productivity variables. If this two points should be applied in O2 organization,
then it will help in making organization much better.
CONCLUSION
From the above study, it can be concluded that leadership is very difficult task and it
contains so many factors that influence leadership style and in above study there is explanation
of different leadership models and characteristics of effective leader. And the study also contains
information about leader’s quality of O2 telecommunication company leaders and how its
leaders are applying motivation theory and removing some weaknesses of Herzberg two factor
theory.
12

REFERENCES
Books and Journals:
Venkataraman, S., 2019. The distinctive domain of entrepreneurship research. In Seminal Ideas
for the Next Twenty-Five Years of Advances (pp. 5-20). Emerald Publishing Limited.
Kirzner, I. M., 2015. Competition and entrepreneurship. University of Chicago press.
Burns, P., 2016. Entrepreneurship and small business. Palgrave Macmillan Limited.
Storey, D. J., 2016. Entrepreneurship and new firm. Routledge.
Cooper, A. C., 2017. Networks, alliances, and entrepreneurship. Strategic entrepreneurship:
creating a new mindset. pp.201-222.
Zhang, S. X. and Cueto, J., 2017. The study of bias in entrepreneurship. Entrepreneurship theory
and Practice. 41(3). pp.419-454.
Fayolle, A. and Gailly, B., 2015. The impact of entrepreneurship education on entrepreneurial
attitudes and intention: Hysteresis and persistence. Journal of small business
management. 53(1). pp.75-93.
Nabi, G. and et.al., 2017. The impact of entrepreneurship education in higher education: A
systematic review and research agenda. Academy of Management Learning &
Education. 16(2). pp.277-299.
13