Analysis of HRM Challenges at Cellair Aircraft: A Global Perspective

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HUMAN RESOURCE MANAGEMENT IN A
GLOBAL ECONOMY
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Contents
Introduction......................................................................................................................................3
Culture.............................................................................................................................................4
Diversity Management.....................................................................................................................5
International Performance Management..........................................................................................6
Training and Development..............................................................................................................7
Conclusion.......................................................................................................................................9
Recommendations..........................................................................................................................10
References......................................................................................................................................11
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Introduction
The report will include a brief understanding of human resource management and its key areas
which are viz. diversity management, culture, training and development, and international
performance management. The report will help in enriching the knowledge about the theories
and concepts of human resource management. The report is based on the Cellair Aircraft which
is an Australian based airline company. The company’s main objective is to increase its profits
and maximize the rate of return on shareholders’ investment. The company plans to expand its
business and to increase its share price. Cellair has subsidiaries in three different countries which
are Singapore, China, and Vietnam. The Cellair Aircraft builds and sells the aircraft mainly to 50
countries. China and Vietnam are engaged in the production of the various parts of the aircraft.
Aircraft are designed and assembled in both Australia and Singapore. The human resource
management of the Cellair Aircraft forms the policies and procedures to expand its business and
achieve higher growth and development (Human Resource Management, 2016). Human resource
management plays an important role in attaining the competitive advantage and creating an
environment of employee involvement and participation.
There are various theories and concepts of human resource management which helps in effective
operations in the company. Human resource management is concerned with the following
functions such as recruitment, selection, job design, training, and development, etc. HR is
responsible for aligning all the activities in order to attain organizational goals and objectives
(Shivarudrappa, et. al., 2010).
Employee behavior is the theory which helps in identifying the individual characteristics of the
employees while performing their job operations. Employees are an integral part of the
organization who takes efforts in accomplishing the goals and objectives of the company.
Motivational Theory deals with the ways in which individuals can be motivated by focusing on
their needs and giving priorities to their needs. The employees shall be motivated by fulfilling
their needs and providing them high-performance goals so that they work hard to achieve the
goals of the company (Hewett, et. al., 2018).
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Theories of performance focus mainly on two things improving the efficiency of the job
performance and increasing the motivation and commitment of the employees towards the
organization (Bratton, et. al., 2017).
Building loyalty is a concept of human resource management as they are held responsible to
build trust and loyalty among the employees towards the organization. The HRM should
introduce the employees with the organizational culture so that the employees work in
accordance to meet the expectations of the organization (Mcclean, et. al., 2018).
Creating competitive advantage is another concept of human resource management as they
form the policies so that the employees work in accordance to the policies and improve their
efficiency and productivity which helps in gaining competitive advantage (MunteanuAnca-Ioana,
et. al., 2013).
Human resource management covers broadly in four main areas such as culture, diversity
management, international performance management, and training and development.
Culture
There are differences in the teams of Cellair as they are working altogether which leads to
communication difference between the management and the teams. Cellair has developed a
negative culture in the organization and employees are following a mantra which states “near
enough is good enough”. The staff of the Cellair is ready to adopt any change so as to extend the
communications between the subsidiaries and the Headquarters. The team of Australian branch
identifies that the main problem Cellair is facing is of quality which is related to the parts
produced in Vietnam and China. The team employees of Australian head office branch analyzed
that Cellair is required to make several modifications in the aircraft even after the delivery has
been made to the customers (Duden, et. al., 2011). The cultural problem includes that both the
government and non-governmental customers are not satisfied with the product and making
continuous complaints about the quality. The stakeholders are very dissatisfied with the
performance and have warned the Cellair to provide improved quality products in next six
months otherwise the stakeholders will hold the company’s partial payment while some of the
stakeholders have quoted a percentage of holding amount. The customers of the Cellair has also
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proposed to withhold 50 percent and some have proposed 100percent withhold the amount in
case of poor quality of products being delivered to them.
The culture of the Cellair Aircraft comprises of the sub-design team with 9 people, wire harness
assembly team with 11 people, and there is another team which supervises that the harness is in
the place in the aircraft. Such team consists of 6 people who are responsible to set the harnesses
in the correct place. The team members have no unification within them for each other and there
is a lot of dissatisfaction. The Cellair Aircraft follows a negative culture which means the
employees work for their teams and for their job specifications. The employees do not adopt the
team working behavior and create problems in the completion of the tasks of other teams rather
than helping them (Campbell, et. al., 2014). Another cultural problem faced by the Cellair
Aircraft is lack of communication which results in lack of transferred information and
instructions to the employees in order to complete the task efficiently and effectively. CEO of the
company has taken several steps to improve the negative culture of the company after analyzing
the situations. It has been found that Australian line manager is considered to be responsible for
lack of communication within the Headquarters and the subsidiary offices/ branches.
Diversity Management
Diversity management refers to avoiding discrimination on any basis in the organization so as to
provide equal rights and opportunities to all the employees working at the same class. Cellair
Aircraft follows the policy of diversity management in which the company is required to show
respect to the employees on the basis of their age, sex, religious beliefs, race, gender, ethnicity,
physical abilities, and other factors (Kim, et. al., 2017). The issues faced by Cellair are rich
people working with diverse people. In headquarters, the employees are not tolerating to work
with the people of different age group or different generations. The senior employees are not
comfortable to work with the trainees and hence the working relations get fatigued. In China, the
people with any kind of disabilities are not recruited and their applications are ignored even
though they are more skilled and talented than other applicants. There are various negative points
faced by the Cellair Company which includes not having clear and transparent practices and
policies for the employees which make it difficult for the employees to understand the culture of
the organization. In order to promote diversity management and improve communication
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effectively in the Cellair, it is essential for the employees to understand the policies and practices
of the company clearly. The company adopts the diversity for the involvement of the
appreciation of different cultures and to know the people or employees within the headquarters,
and subsidiaries. Diversity management helps in removing the discrimination with the
organization and attracts more employees and help in increasing the retention rate. It influences
people to work together and in harmony by building amicable relations with each other.
Adopting diversity management in the Cellair Company can help the company in gaining
competitive advantage and helps in the expansion of its business with increased goodwill, growth
and development. Diversity management promotes and encourages innovation in the company
and helps in solving the critical problems of the company. It influences people to produce high-
quality products in order to match the required standards. The CEO of the Cellair Company was
scared of the consequences of ignoring the applications of disabled applicants and fears of facing
any kind of legal actions from the candidatures being rejected on the ground of their disability.
This causes a serious issue in the organization and affects the diversities of the company results
in diminishing the image of the company (Lauring, et. al., 2012).
International Performance Management
The Cellair Company operates its activities outside Australia and has its subsidiaries in countries
viz. China, Vietnam, and Singapore. The Cellair Company faces various international
performance problems in the working environment. The international performance is directly
related to the appraisals in international performance (Audenaert, et. al., 2016). The issue faced
by the Cellair Company on the part of the international performance is the HR has conducted the
performance in Australia but no performance reviews were conducted in any of the subsidiaries
of the company. Another issue in international performance is not considering the economic
factors which affect the set targets of the business. The decisions made in Australia (headquarter)
are to be followed by all the subsidiaries and the same policies and procedures should be
adopted. In case Australia gives a decision and orders the subsidiary in Singapore to produce a
specific number of parts in order to determine the surplus of the parts produced in Australia
results in the increased conflicts in performance outcomes. The Cellair Company has not formed
any kind of policy in relation to the performance management and hence performance
measurement cannot be successfully achieved by the Human Resource of the Cellair Company.
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The CEO of the company provides guidance to the HR to bring consistency in the local practices
and culture of all the branches of the Cellair including headquarters and subsidiaries. The Cellair
Company aims to improve the productivity and efficiency at international borders by managing
the performance and taking corrective measures to improve the performance. The international
performance appraisal is the function of human resource management and appraisal is done in
order to improve the performance of the employees in international subsidiaries. The
international performance management is done to analyze the strengths and weaknesses of the
employees, their training needs, future development, and motivation they require to improve
their performance and increase their efficiency (Gerrish, et. al., 2016). The company shall focus
on international performance management in order to improve its operations at a global level by
providing the employees with clear instructions as to the desired objectives of the company.
There are several numbers of contingencies in relation to the environment are there in different
subsidiaries of different countries. These contingencies form a distance between the subsidiary
companies and headquartered company. There are various cultural differences, social, economic,
and political differences, language barriers which can affect the performance in the international
subsidiaries and the company shall take steps to manage the same.
Training and Development
Training and development is the procedure which every organization must follow so as to
provide the newly recruited and existing employees the training to enrich their knowledge about
the company’s policies, procedures, expectations, terms and conditions, requirements, etc.
Training and development program shall provide the employees the detailed information about
their job roles and responsibilities and the way of performing their jobs while considering the
policies of the company (Sartori, et. al., 2018). Training and development is a function of Human
Resource Management and it is the role of human resource to provide all the employees with
sufficient time of training. Training and development program helps in improving the efficiency
and productivity of the employees and influences them to work hard. Training and development
activity should not be biased and every employee should be given regardless of his/ her area of
operations. Employees of all the activities of the organization such as marketing, sales, finance,
accounts, etc.should be given equal right to attend the training and development program. After
determining the performance of the employees in Cellair, it has been understood that it is
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strongly required for the HR to give its focus more on the training and development program so
that the employees learn to work together as a team rather than working against each other. The
Cellair Company does not have any development program for the employees which results in
less motivated employees. The management development program help in identifying the
potential employees and recruiting highly skilled employees, it helps in developing the
knowledge of the employees and helps them in understanding the organizational goals and needs.
Because of the lack of management development program, the employees of the Cellair are not
aware of their career in the company and how they are useful in fulfilling the planned objectives
of the company (Aguinis, et. al., 2009). The top management employees do not help the lower
level employees or their subordinates to take over their job role because of the fear of getting
sidelined from the promotions. Lack of training and development program results in a negative
attitude of the employees towards each other and increased competition within the organization.
This results in less number of productive employees and thus the goodwill, revenues, and profits
of the company decrease at a rapid pace (Holmes, et. al., 2017). Training and development
program is an important function of HR as it helps in improving the performance of the
employees in the organization.
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Conclusion
From the above report, it has been concluded that Cellair is an Australian based Aircraft
company who has subsidiaries in three countries i.e. Singapore, Vietnam, and China. The Cellair
Company needs to make several modifications in its policies and procedures and required to
make improvements in the human resource management department. The Company is facing
several issues such as providing poor quality aircraft to the customers, lack of training and
development program in the organization, poor, and harmony among employees, lack of
diversity management and increased discrimination, etc. The company is facing numerous
problems which result in decreased sales, revenues and profits of the company are not only its
headquarters but also in subsidiary companies. The Cellair Company’s Human Resource
Management shall take efforts to motivate its employees to work as a team and contribute to
accomplishing the desired goals and objectives of the company. The report concludes that the
CEO fears of the legal action for ignoring the applications of the disable people because of
discrimination. The report also concludes that there is an increased number of cultural
differences, language differences, etc. in subsidiaries and the headquartered company which
leads to differences in the management of the international performance of the employees of the
Cellair Company.
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Recommendations
On the basis of the case study and above report, there are several recommendations and
suggestions are made to the Human Resource of the Cellair to improve its functions, operations,
and activities and achieve greater success and increased growth and development. The
recommendations include (1) employing skilled, knowledgeable, focused, and talented
employees in the company so that they work with the objective of fulfilling the needs and goals
of the organization. (2) The HR of the company shall conduct proper training and development
program for the newly hired and already existing employees to improve their efficiency and
productivity. (3) There should be proper communication between the senior employees and their
subordinates and proper instructions should be provided for successful and effective completion
of the activities. (4) The company should focus on improving the relations among the employees
to promote working together as a team.
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