Comparing Hard and Soft HRM Approaches: Unilever Case Study Analysis

This report provides a comprehensive overview of Hard and Soft Human Resource Management (HRM) approaches. It begins by defining the core concepts of both hard and soft HRM, highlighting their distinct characteristics and objectives. Soft HRM is presented as an approach that prioritizes emplo...Read More

Managing Human Resource

Table of Contents
INTRODUCTION...........................................................................................................................1
Definition of concepts of Hard and soft HRM.............................................................................1
CONCLUSION................................................................................................................................1
REFERENCES................................................................................................................................2

INTRODUCTION
The human resource can be managed by making the the the perfect policies and procedures for
the organization according to which the organizational activities will be managed and run-ned
successfully. The organizations must have the competitive advantages by which they can make
the reputation and image of the their organization in the market. This good image will attract
more and more consumes towards the purchase of the products of the organization. The
performances of the employees in the organization are also evaluated under the human resource
management system. The performances of the employees are based on the benefits and resources
which they receive from the organization. The resources are used by the employees to work more
efficiently and effectively in the organization.
The Unilever is the top manufacturing company in the world. Its headquarter is
established in the London, United Kingdom and it deals in the transnational consumers goods
which are consumed by their consumers globally. It is a public lusted company run ned Lever
Brothers.
MAIN BODY
Definition of concepts of Hard and soft HRM
Human resource management can be defined as a strategic approach and framework that
is being used for an effective management in an organization. To motivate and perform all
activities which can manage workforce in a manner by which they can support the company in
accomplishing their goals (Rahman, Tabassum and Sultana, 2017). For an effective management
and accomplishing this purpose, HR plays several functions which includes: Hiring, selecting,
compensation, motivation, training, workplace safety, rewards etc. It can be more described is a
detail manner by its 2 distinct forms such as: Soft and Hard HRM.
Soft HRM: This approach includes all those functions and activities which provides
guidance and self direction. The focus of this approach is on individual and increasing their trust
with the company. Companies who adopt and follow this approach, they treat their employees as
the most important asset as without them organizational success can not done. They also try to
satisfy their employees before satisfying customers. They think that employees' satisfaction is the
key of success which is directly linked with customers' satisfaction. These type of organizations
also integrate employees' needs into their long-term organizational strategy. It is relationship
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oriented whose main purpose is to stay employees and customers with the company for the long
run.
Importance: Some key benefits of using soft HRM are described as below:
The main advantage of this concept of HRM is increased loyalty and trust among
employees. HR performs several functions as per this approach such as hiring, training,
motivation, rewarding, performance appraisal etc. Highly motivated employees live with the
company which increases brand image of the company. Democratic leadership style is other
main feature of this approach. According to this style, employers give opportunities to all
employees to take active participate in decision-making process which increase their critical
thinking skills and feel them valued (Verma and et.al., 2018). Other main characteristic is
increased satisfaction of customer as when employees feel respected and valued by employers
then they give their extra efforts in accomplishing company's goals which lead satisfaction of
customers. Open communication, friendly environment, highly motivation are some features of
this soft HRM.
Limitations: For motivating employees there is a requirement for the company to invest
more in employees' development programs like training programmes, wages increment etc.
Other main disadvantage of this approach is it may delay in decision-making process and lead
errors in decision-making process. When all employees are given equal chance in decision-
making process then existing and experienced employees feel demotivated.
Example: Darla is the best example who follows soft HRM approach. It is an organization who
works for accounting firm. It can be said that, this Darla organization conduct a monthly team
meeting with its accounting department and share all details and news about the company. They
do not only give informations but also ask some suggestions and feedback for more improving
activities and motivate employees (Example of the company follows soft HRM, 2019).
Hard HRM: Hard HRM is just opposite of soft HRM. In this approach, HR and manager
mainly focuses on performance management and rationalism of strategic fit. Those organizations
who do not focuses on making employee friendly human resource management system are
consider as following hard HRM. In other words it can say that the company who adopts Hard
HRM system and approaches are task oriented rather than relationship. The main purpose of
these type of organizations is to get the work done only from employees. It is the way of looking
and treating employees and specifically their policies for employees.
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In addition, it can also be said that these companies perform HRM functions like hiring,
training and firing. They fire employee whenever they need as they do not consider their
relationship and loyalty (Michael, 2017).
Importance: Some benefits of Hard HRM are:
It may not sound good if it is compared to soft HRM but still it has some benefits in some
type of situations. As it is a task oriented approach so, it can be said that there is a strict form of
hierarchy in a company. Decision making power is also in the hand of the higher authority which
decrease the chances of errors in the process. Autocratic leadership is the main characteristic of
this HRM. It is beneficial when employees do not have proper experience and it also removes
diversity. Company can make a strict working environment in which employee do not take
undue advantages as they are only allowed to focus on their work and take promotional
opportunities.
Limitations:
As compare to benefits, there are several disadvantages of hard HRM. The main
disadvantage and limitation is, it does nit focus on relationship which decreases morale and
loyalty of employees. Nowadays people are becoming more emotional. Due to work pressure
they need to be taken care by employers. When they feel care and respect they are more likely to
stay within an organization. So, it can say that this Hard HRM approach is the main reason of
high labour turnover and conflicts (Johnstone, 2016).
Example: The best example of hard HRM is manufacturing industries. In these industries,
employees are paid the minimum wages and attrition rate is high as well. Salary is based on the
performance and do not focus on motivational and development programmes. They give some
medical bonus pay for motivating. So, it can be said that manufacturing industry can become the
most effective and the best example.
Some differences between soft and hard HRM are:
Hard Soft
Treat employees as a common resource of the
company
Treat employees as the most important
resource of the company.
Identify needs of the business and perform all
functions accordingly.
Identify and focus on employees needs.
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Task oriented approach Relationship oriented approach
Minimal communication from top to the down. Strong and continuous 2 way communication.
Hierarchical structure Flat organizational structure
Little empowerment of delegation Employees are empowered more for taking
responsibility.
Follow autocratic leadership style Follow democratic leadership style
So, from the above differentiation between soft and hard HRM it can be said that soft
HRM is better than hard for both employers and employees. It is not suitable in only few
situations.
Organization Using Hard Approach to HRM
The organization which uses the hard approach is the Unilever. The hard approach of the
Unilever was founded by the Michigan by applying the theory X. There were the missions and
strategies of the Unilever which effected its organizational structure and human resource
management. There were some external forces on the organization which effected their hard
approach to the management. These external forces were cultural forces, economic forces and
political forces. In this we will use the structure of the Hard Approach of HRM(Wellin, M.,
2016).
Mission and Strategies of the Unilever
The mission of the organization was :
 To add the vitality in the lives of their consumers.
 To meet everyday needs of their consumers.
 To give best hygiene, personal care and nutrition products to the consumers of their
products.
 To provide the consumers with the good look, good feeling and getting them more out
from their lives.
 The organization wants to provide the nutrition and essential proteins which are required
by the human body for its development. The organization was producing the products at
the lowest rate possible with the mission to remove poverty and lack of nutrition among
the poor people in the world(Johnson and et.al., 2017).
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The strategies followed by the Unilever were as follows:
 The organization used the porters 5 model as the main marketing strategy of the
organization. In this the organization has followed the differentiation as their genetic
strategy in the competitive advantage of the organization.
 The major focus was to make the different and unique image of the products produced in
the organization as compared with their competitors or rivalry organizations products.
 This different image was created by keeping the prices low with the best quality of raw
materials used in the manufacturing of the products.
 The Unilever was providing the products which very considered as the basic needs
among the consumers. These products were having very different features as compared
with other competitors products.
 For example - The innovation of soaps like dove whose USP was creamy and
moisturising essence which made the skin more soft and the harshness occurred because
of the soap was not there in the Dove.
 The organization was producing the designed products according to the age and genders
which bought many customers attracted towards them.
 There was an market penetration which was used to increase the sales volume which will
generate more and more revenue for the organization.
 The product development of the organization in which they were modifying the already
existing products according to the neds and preferences of the consumers.
 The Diversification in the products of the organization was done by establishing new
business and its expansion to achieve the maximum growth and development in th
market.
 The market development was done to get entry in the new markets where they can launch
their new inventions and innovations made in the products of the Unilever.
Organizational Structure of Unilever
The Unilever is having the hierarchy organizational structure which was this:
 The top most position was given to the director Graeme Pitkethly who was controlling all
the staff and other shareholders and stake holders of the Unilever.
 The next to director the there was an vice president Alan Jope who was managing the
activities within and outside the oragnization.
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 The next were the shareholders and stakeholders of the organization who has invests in
the Unilever by purchasing their shares.
 Th next were the general mangers of the Unilever who was taking care of all the
employees and management of the organization as a whole.
 The next were the mangers of the different department such as finance, HR, Marketing
and Operations who were managing the employees and their activities in their
department([Online]. Available through: <https://www.unilever.com/Images/es_insead-
report220208_tcm244-409736_en.pdf>).
 The last were the employees who were working in the different departments while
handling the different activities of the Unilever.
HR Management of Unilever
The organizational structure of the Unilever was having the following in it:
 Motivating the employees
The employees were highly motivated by giving them all the resources and paid laves which
they can take at any time during their working period in the organization. There were many
motivational activities played within the organization to improve the working capabilities and
capacities of the employees. There were many promotions and growth opportunities provided by
the Unilever in the motivating their employees.
 Rewards given to employees
The rewards given to employees were according to the work and targets achieved by them in the
given period of time. These rewards were in the form of incentives and bonuses which made a
jump in the earnings of the employees of the Unilever. The rewards given to employees were
excluded from their salaries and they were receiving these rewards only on the completing of
their targets or by doing some extra ordinary activity which was beneficial for the organization.
 Performance Appraisal of Employees
The performance appraisal was made twice in the year in the Unilever. The performance
appraisals were made to check the performance of every individual in the organization and the
promotions were made accordingly. The performance appraisal of the organization not only
determined the working capabilities of the employees but also their behaviour and attitude with
other employees of the organization. The performance appraisal was done through the survey in
which the questionnaire was formed the feedback were taken by the employees working in the
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organization. For each department separate feedback form or questionnaire was made to check
the capabilities of the employees.
 Briefing the mission and vision of the Unilever to their employees
The employees of the Unilever were clearly briefed with the vision and mission of the
organization which they have to keep in mind while working for their work. The employees were
guided time to time by their mentors and the path which they have to follow while achieving
their targets were described to them.
The forces which affected the Hard Approach of the Unilever were as follows:
 Cultural Forces
The cultural forces were the rising health and consciousness for the products used by the
consumers of the organization. The organization was producing those products which were not
having any harmful chemicals which can harm the human body.
 Economic Forces
The organization was increasing their sustainability in the efforts made in the business. The
complexities among the environmental programs were increased.
 Political Forces
The political factor of the organization was having the stability in the market. The free trade
relations were growing in the market.
Organization using Soft Approach in the HRM
The soft approach of HRM was given by Harvard and it is known as theory Y. The Soft
Approach consist of the following in the Unilever:
 Stakeholders Interest
In this the employees, government, management, union and communities performances and the
revenue and profits generated by them in a financial year are evaluated. The investments made
by stakeholders and shareholders in the Unilever are made by keeping the performances of the
employees and the needs of the market([Online]. Available through:
<https://www.unilever.com/Images/es_insead-report220208_tcm244-409736_en.pdf>)
 HR Strategies
The organization followed many HR strategies such as motivation, Rewards system,
performance appraisals, work system, recruitment and selection policies and managing the
employees work and their need within the organization. The employees were following all the
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policies and procedures made Unilever so that the can increase their work efficiency and number
of outputs in the organization. The HR strategies followed by the organization were very much
different from the other organizations policies and strategies. The Unilever was having a
copyright and patient right reserved on the marketing strategies and HR policies.
 HR Outcomes
The HR Outcomes of the organization were the extra ordinary performance in the market. The
organization was having very unique and differentiated products the market who were having
very less competition and the marketing strategies performed by the Unilever has conquered the
market and the customers got attracted more towards them as compared with other compete ting
firms products.
 Long – Term Consequences
The organization has made many long term consequences by keeping the environmental issues in
mind by producing the products which are eco friendly and which are not having the harmful
chemicals in them. This strategies did not caused any harm to the skins of the humans and
because of this they stayed long in the market without any problem. The organization focused on
the improvement of the health and well being of the customers. The eatable products of the
organization were highly nutritious and they were maintaining the good health among their
consumers. This made them stay long in the market.
 Situational Interest
The situational interest of the organization was according to different situations and problems
faced by the organization in the market. In this many leadership theories, Advices of Experts and
the help of government was taken to solve the issues in the market. The type of workforce,
technologies used in the organization for doing the business, management philosophies,
workforce of the labours etc. were evaluated by the managers of the organization.
CONCLUSION
The report can be concluded by mentioning explaining the hard and soft HRM in the
Unilever. The organization was using the Michigan's theory X model in explaining the hard
HRM policies of the organization. In this model, the mission and strategies of the Unilever, its
organizational structure, HR management theories and the external forces which effected the
organization HRM. The external forces by which the Unilever got effected were the cultural
forces, economic forces and the political forces. The organization also had the soft approach
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which had the stakeholders interest in the organization which changes according to the working
capabilities of the employees. The another was the HR strategies and HR outcomes which were
having the all the strategies applied by the employees and their impact on the output produced
the organization in the market. There were many long term plans and strategies made by the
organization to stay long in the market.
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REFERENCES
Books and Journals
Rahman, T., Tabassum, A. and Sultana, N., 2017. Identifying the Reliability and Validity of
Hard and Soft HRM Measures: A Study on the Banking Sector of Bangladesh. ABAC
Journal. 37(2). pp.104-117.
Michael, F., 2017. Hard and Soft Human Resource Management Compensation Practices on
Employee Job Satisfaction. ORSEA JOURNAL. 5(1).
Johnstone, S., 2016. Hard and soft HRM. In Encyclopedia of Human Resource Management.
Edward Elgar Publishing Limited.
Verma, P. and et.al., 2018. Graduate work-readiness challenges in the Asia-Pacific region and
the role of HRM. Equality, Diversity and Inclusion: An International Journal. 37(2).
pp.121-137.
Wellin, M., 2016. Managing the psychological contract: Using the personal deal to increase
business performance. Routledge.
Johnson, and et.al., 2017. Managing Generational Differences in Nonprofit Organizations.
In The Nonprofit Human Resource Management Handbook (pp. 304-322). Routledge.
Secundo, and et.al., 2016. Managing intellectual capital through a collective intelligence
approach: an integrated framework for universities. Journal of Intellectual Capital, 17(2), pp.298-
319.
Bana, B., 2017. Managing the Staffing Function in Public Services: the Tanzanian
Experience. The African Review, 33(1 & 2), pp.85-125.
Hamiot, J.Y., 2018. Managing career lengthening in France: why such inertia?. Journal of
Management Development.
Namugenyi, and et.al., 2018, June. On a Smart Digital Gender Ecosystem for Managing the
Socio-Economic Development in the African Contexts. In International Conference on
Intelligent Decision Technologies(pp. 139-149). Springer, Cham.
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Williams, P.G., 2017. Confederate Political Economy: Creating and Managing a Southern
Corporatist Nation, 1861-1865. Political Science Quarterly, 132(4), pp.778-781.
Hughes, and et.al., 2019. References', Managing Technology and Middle-and Low-skilled
Employees (The Changing Context of Managing People).
Meentemeyer, and et.al., 2017. Collaboratively managing sudden oak death using tangible
geospatial modeling. In Proceedings of the sudden oak death sixth science symposium. Gen.
Tech. Rep. GTR-PSW-255. Albany, CA: US Department of Agriculture, Forest Service, Pacific
Southwest Research Station: 9-10. (pp. 9-10).
Nzewi, O.I., 2015. Managing Human Capital in the Public Sector, David M. Mello (Ed.): book
review. Journal of Public Administration, 50(2), pp.414-419.
Online
Example of the company follows soft HRM. 2019. [Online]. Available
through :<https://study.com/academy/lesson/soft-hrm-employee-first-focus.html>.
[Online]. Available through: <https://www.slideshare.net/mohiuddinkhantanvir/soft-hard-model-
of-hrm>
[Online]. Available through: <https://www.unilever.com/Images/es_insead-
report220208_tcm244-409736_en.pdf>
(Wellin, M., 2016)
(Johnson and et.al., 2017)
(Secundo, and et.al., 2016)
(Bana, B., 2017)
(Hamiot, J.Y., 2018)
(Namugenyi, and et.al., 2018)
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(Williams, P.G., 2017)
(Hughes, and et.al., 2019)
(Meentemeyer, and et.al., 2017)
(Nzewi, O.I., 2015)
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