Project: Employee Benefit Expenses & Financial Performance of BHP Ltd

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This project examines the relationship between employee benefit expenses and the financial performance of BHP Group Ltd in Australia. The research aims to quantify this relationship using a quantitative methodology, focusing on data collected from BHP's official website and annual reports. The project employs a conceptual framework that highlights the importance of employee satisfaction and engagement, including elements like wages, bonuses, and a positive work environment, and their impact on key financial metrics such as market share, revenue, and net operating profit. A literature review supports the core argument that employee benefits directly influence productivity and financial stability. The methodology involves bivariate and linear regression analysis to assess the correlation between employee benefit expenses and financial outcomes. The project includes a Gantt chart detailing the project's timeline, from topic selection to final presentation.
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Project Management
impact of employee benefit expenses on financial performance of BHP Group ltd, Australia
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Contents
Introduction:...............................................................................................................................2
Research Aim:........................................................................................................................2
Research Question:.................................................................................................................2
Conceptual Framework:.............................................................................................................2
Literature Review:......................................................................................................................5
Research Methodology:.............................................................................................................6
Gantt chart:.................................................................................................................................7
References:.................................................................................................................................7
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Introduction:
Performance of the enterprise depends on the attitudes of the employees and their willingness
for completing their given task within the approved time frame and cost. It helps in
measuring the sale forecasting and total revenue generated from the sale (Yeung, and Ennew,
2012). Productivity of the organization directly affects by the employee engagement
program. Financial stability of the enterprise depends on the satisfaction of employees with
their job and the working environment. Coordination among the processes and distribution of
work in the team members is the basic requirement for achieving the desired mission
successfully and flawlessly. Increased productivity boost up the product sale and ultimately
enhances the turnover of the firm. Employee’s plays vital role in the product development
lifecycle. It is the responsibility of the top management to make sure that working employees
are satisfied with their jobs. Periodic motivation program and providing required benefits to
the employees increases their dedication in finishing their given task with expertise.
Employee benefit expenses are the part of the financial expenditure of the firm. Employee
benefit expenses foster the rate of productivity and hence increases the profitability ratio of
the company. In this paper we will analyse the impact of employee benefit expenses on
financial performance of the BHP Group Ltd in Australia. The research study helps me to
choose human resource manager as profession because it helps in developing managerial
skills and understanding financial analysis concept by evaluating the relationship which exist
between the benefits provided to the employees and revenue generated by the firm.
Research Aim:
The aim of our research is to measures the relationship exists between the employee benefits
and financial performance of the enterprise by deploying the quantitative analysis on the data
collected from the official website of the organization. The research program helps in
evaluating the impact of employee’s benefits on the financial performance of the enterprise.
Research Question:
Is there any relationship between employee benefit expenses and profit earned by the BHP
organization?
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Conceptual Framework:
Growth and profitability of the enterprise depends on the employee contribution in improving
the operational and productivity process so that customer demands can be fulfilled at glance
and results in increasing the net operating profit earned by the enterprise (Jacobson, and
Mizik, 2009). Initialization of the feedback system work as a tool to analyse the employee
requirement and taking suggestion in solving the complex problem of the business helps in
accelerating the growth and earning financial stability of the enterprise (Zhang, and Pan,
2013). Transformation of the employee benefit system according to the requirement of the
working staff members such as incentives, bonus, maternity and paternity leave, award
system, recognition provided for the outstanding performance, providing resources and good,
healthy, and clean working environment, and genuine payment for overtime is useful for
enhancing the market share of the firm, increasing product sale, and accelerating revenue
earned and net operating profit of the enterprise (Ajose, 2017). Chaotic environment at the
workplace can be minimized by indulging harmonious relationship within the colleagues by
developing the motivational plan and effective grievance handling system (Brown, and et.al.,
2015). Arrangement of training and development program for the employees is effective for
their personal development and helps in handling the complex situation of the product
lifecycle efficiently.
Connectivity and dedication of the employees towards the enterprise can be enlightens with
the association of direct and indirect benefits provided to them (Ekere, and Amah, 2014).
Profitability of the business is in the hands of the working members because they are
responsible for developing quality product and services provided to the customers as their
demand (Jehanzeb, and Bashir, 2013). Financial growth of the enterprise can be measured by
forecasting the sale of the product which can be evaluated by estimating number of satisfied
customers. Employees are responsible for providing quality of services and product to sustain
long term financial stability (Hallowell, 2017). In the conceptual diagram, it can be predicted
that there is a direct relationship between the employee benefit expenses and the financial
performance of the firm. There are different schemes generated for workers benefit such as
remuneration, compensation, bonus, reward, award, pension, and others. It helps in increasing
the willingness and contribution in completing their desired activities. Enhancement in the
product sale results in increasing the market share value, goodwill, reputation, and net profit
earned by the company. Conceptual framework of the relationship between the employee
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benefit expenses and the financial performance of the organization is designed in the diagram
below:
Relationship between Employee benefit expenses and Financial Performance of
the organization
Employee Benefits
expenses program Financial Performance of
the enterprise
Effective communication plan
between employees and top
management
Active participation of
employees in designing phase
Coordination and cooperation
among the participants
Grievance handling
Willingness and contribution
of the employees
Job Satisfaction
Wages and Salary
Payment of
overtime
Recognition and
reward
Bonus and Award
system
Medical and
Paternity leave
Good, healthy and
clean environment
Training and
development
program
Increasing market
share
Increasing Return on
investment
Increasing net
operating profit
Increasing product
sale
Enhancing goodwill
and reputation
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(Source: Made by Author)
Literature Review:
Sales and profitability ratio of the firm can be measured by evaluating the quality of skills
and expertise inhibits in the working staff members (Mabaso, and Dlamini, 2017). Analysis
and evaluation of the financial stability of the business helps in increasing the decision
making capability for enhancing the sale of products, identifying risks at an early stage to
reduce uncertainty occurrence, increasing profit earned, and clear estimation of cost with
respect to the market price (Tessema, Ready, and Embaye, 2017). From the literature study, it
is evaluated that satisfaction of the customers is solely responsible for gaining financial
stability of the enterprise. Managing loyalty in providing employee’s benefits at regular
interval of time helps in building strong and healthy relationship with them which fosters the
product sale and goodwill of the enterprise (Ton, 2013). Behaviour of the employee are
getting influenced by the in-time delivery of benefit expenses according to the work done by
them in improving the productivity (Yaghoobi, Moradi, Nooghabi, 2015). Developing good
and strong relationship with the working staff members by providing regular remuneration
and reward for their outstanding performance increases their level of satisfaction and hence,
increases the productivity and attains long term sustainability of the firm (Yamamoto, 2011).
Outcome of the employee benefit program designed is to change the attitude and behaviour of
the employees to attain the enterprise goal and mission (Zhang, and Pan, 2013). Turnover of
the business get accelerated by the active participation of the employees in the project
designing phase, manging coordination and communication between the top management and
subordinates, identification of grievances, motivating and initializing team spirit, arrangement
of remuneration and recognition for the extraordinary work, and providing periodic
Accidental
compensation
Social Security
Pension plan
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compensation (Lin, Yao, and Zhao, 2014). Future investment can be judged by evaluating the
financial condition of the firm. Forecasting the sale of business identifies the return on
investment and net profit earned by the organization (Stalmasekova, Genzorova, and
Corejova, 2017). Benefits to the employees should be provided such as wages and salaries,
awards and rewards to them, initializing security cost, pension plans, paid leaves, and others
(Hina, and Zamir, and Nudrat, 2013). Gaps in managing relationship with the existing and
new employees can be filled by taking their reaction and feedback about the services
provided to them, identifying the areas of improvement, developing the relevant employee
benefit strategy so that it can have a direct impact on the thought process of the employees,
diversification in the services and facilities provided to them, changes in attitude and
behaviour, and others. Net operating profit of the company can be raised by increasing the
sale of product which can be done by attracting more and more customers from the global
world by providing quality of services and facilities to them with the amalgamative efforts of
the employees (Tomeikova, 2013). Long term relationship can be developed with the
employees by increasing their level of satisfaction with the deployment of required benefits at
regular interval of time (Nemeckova, 2016). Arrangement of personality development
program for the working team members increases the level of confidence, expertise, and
creativity to complete their tasks with accuracy and expertise.
Research Methodology:
Research is completed by implementing the quantitative research methodology so that
accurate data can be studied for evaluating the impact of employee benefit expenses on the
growth and financial stability of the enterprise. The research was conducted on the BHP
group limited in Australia whose Headquarters is located in Melbourne.
Internet surfing is helpful in collecting financial data of the enterprise from their official
website and annual reports. Analysis of the financial data results in evaluating the role of
employee’s played in increasing the turnover of the organization. In this, we have taken two
variables which are named as financial stability and employee benefit expenses. Customer
satisfaction is an independent variable and financial stability is the dependent variable which
can be analysed and calculated by identifying the data collected from the website of the
enterprise in relation to the financial stability and customer satisfaction.
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Quantitative analysis of data is done developing relationship between the two variables
named as employee benefit expenses and financial performance of the enterprise. We will
conduct bivariate analysis on the quantitative data collected to study the statistical report.
Linear regression analysis is evaluated on the excel sheet on the taken two variables. Net
operating profit and financial performance is plotted on the Y-axis and expenses on the
employee benefit on the X-axis. The analysis between the variable helps in evaluating the
relationship between them and how changes in one variable affect the performance of the
other variable.
Gantt chart:
Task Name Duration Start Finish
Research Project 60 days Thu 29-08-19 Wed 20-11-19
Selection of the research topic 3 days Thu 29-08-19 Mon 02-09-19
Writing project abstract 3 days Tue 03-09-19 Thu 05-09-19
Submission of Project abstract 2 days Fri 06-09-19 Mon 09-09-19
Implications of data collection
sources 4 days Tue 10-09-19 Fri 13-09-19
Internet surfing 2 days Tue 14-09-19 Wed 02-10-19
Data Analysis and Findings 5 days Tue 03-10-19 Mon 14-10-19
Preparing Research Questions 4 days Tue 15-10-19 Fri 18-10-19
Writing Draft 1 3 days Mon 21-10-19 Wed 23-10-19
Submission of Draft 1 2 days Thu 24-10-19 Fri 25-10-19
Writing of Draft 2 4 days Mon 28-10-19 Thu 31-10-19
Submission of Draft 2 2 days Fri 01-11-19 Mon 04-11-19
Writing of Complete report 4 days Tue 05-11-19 Fri 08-11-19
Submission of Report 1 day Mon 11-11-19 Mon 11-11-19
Preparing Presentation 3 days Tue 12-11-19 Thu 14-11-19
Final Presentation 2 days Fri 15-11-19 Mon 18-11-19
Project Closure 2 days Tue 19-11-19 Wed 20-11-19
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References:
Ajose, B. (2017). Employee compensation and its effect on employee productivity. 1st ed.
Retrieved from
https://www.academia.edu/25932687/employee_compensation_and_its_effect_on_e
mployee_productivity
Brown, S., Gray, D., McHardy, J., and Taylor, K. (2015). Employee trust and workplace
stability. Journal of economic behaviour and organization 116(2015), pp. 361-378.
Retrieved from
https://www.sciencedirect.com/science/article/pii/S0167268115001365
Ekere, A., and Amah, E. (2014). Staff compensations and organization stability: A study of
private hospitals in River state, Nigeria. International journal of business and
managmenet, 16(2), pp. 24-28. Retrieved from
http://iosrjournals.org/iosr-jbm/papers/Vol16-issue2/Version-3/D016232428.pdf
Hallowell, R. (2017). The relationship of customer satisfaction, customer loyalty, and
profitability, an empirical study. 1st ed. Retrieved from
https://pdfs.semanticscholar.org/f772/e831c1afbcf38371da9cad29a5eb4422636e.pdf
Hina, Q., and Zamir, S., and Nudrat, S. (2013). Impact of employee benefits on job
satisfaction of teachers at higher level. Journal of education and practice, 5(7).
Retrieved from
https://pdfs.semanticscholar.org/6675/2107c92dd0041aa3b2fbfa5b54e3262db165.pd
f
Jacobson, R., and Mizik, N. (2009). The financial markets and customer satisfaction: Re-
examining possible financial market mispricing of customer satisfaction. Journal of
marketing science, 28(5). Retrieved from
https://www0.gsb.columbia.edu/mygsb/faculty/research/pubfiles/2816/
MktgSci_ACSI.pdf
Jehanzeb, K., and Bashir, N. (2013). Training and development program and its
compensations to employee and organization: A conceptual study. European journal
of business and management, 5(2). Retrieved from
https://www.dcvmn.org/IMG/pdf/3947-5999-1-pb.pdf
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Lin, Z., Yao, X., and Zhao, Z. (2014). The direct and indirect impact of employee benefit on
firm performance of china. Asia pacific journal of human resources, 52(2014), pp.
476-495. Retrieved from https://onlinelibrary.wiley.com/doi/epdf/10.1111/1744-
7941.12037?
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NPFMU8HxlksUz6US_3YkAZWXwtr27eobskYLAgs19w35qwP_FKR_iskpTkjSb
yH_w%3D
Mabaso, C., and Dlamini, B. (2017). The impact of compensation and compensations on job
satisfaction. Research journal of business management, 11(2017), pp. 80-90.
Retrieved from https://scialert.net/fulltext/?doi=rjbm.2017.80.90
Nemeckova, I. (2016). The role of benefits in employee motivation and retention in the
financial sector of the crech republic. Journal of economic research. Retrieved from
https://www.tandfonline.com/doi/full/10.1080/1331677X.2017.1314827
Stalmasekova, N., Genzorova, T., and Corejova, T. (2017). Employee benefit as one of
factors of work motivation. International conference on innovation in science and
education, 331(2). Retrieved from
https://www.researchgate.net/publication/320493647_EMPLOYEE_BENEFITS_AS
_ONE_OF_FACTORS_OF_WORK_MOTIVATION
Tessema, M., Ready, K., and Embaye, A. (2017). The effects of employee recognition, pay,
and compensations on job satisfaction: Cross country evidences. Journal of business
and economics, 4(1). Retrieved from
https://pdfs.semanticscholar.org/d999/306d685a85cbe2232a844f8415a689e985f0.pd
f
Tomeikova, L. (2013). Employee benefits and trends in the workplace. Journal of business
and economic, 4(1), pp. 1-12. Retrieved from
https://exclusiveejournal.sk/files/files/51/90/71/ab312989c6264469a1ff53c2e100b5b
c/ab312989c6264469a1ff53c2e100b5bc.pdf
Ton, Z. (2013). The effect of labor on profitability: The role of quality. 1st ed. Retrieved from
https://www.hbs.edu/faculty/Publication%20Files/09-040_146640ac-c502-4c2a-
9e97-f8370c7c6903.pdf
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Yaghoobi, H., Moradi, M., Nooghabi, M. (2015). Effects of employee expenses on usefulness
of accounting information. International journal of accounting and financial
reporting, 5(1). Retrieved from
https://www.researchgate.net/publication/312412478_Effect_of_Employee_Expense
s_on_Usefulness_of_Accounting_Information
Yamamoto, H. (2011). The relationship between employee compensation management and
employee retention. International journal of human resource management, 22(17).
Retrieved from
https://www.researchgate.net/publication/224285658_The_relationship_between_em
ployee_compensation_management_and_employee_retention
Yeung, M., and Ennew, C. (2012). From customer satisfaction to profitability. International
journal of marketing strategy, 8(4), pp. 313-326. Retrieved from
https://www.researchgate.net/publication/233690605_From_customer_satisfaction_t
o_profitability
Zhang, C., and Pan, F. (2013). The impact of customer satisfaction on profitability: A study of
state owned enterprises in China. 1st ed. Retrieved from
https://www.researchgate.net/publication/228456961_The_impacts_of_customer_sat
isfaction_on_profitability_A_study_of_state-owned_enterprises_in_china
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