Managing Human Capital and Leadership: A Report on H&M

This report provides a comprehensive analysis of human capital management and leadership within Hennes & Mauritz (H&M). It begins by exploring relevant models and analyses of H&M's approaches to human resource management, including the Human Resource Value Chain Model and the Guest Model. The report then delves into recruitment and selection strategies, evaluating strategic HR initiatives and offering recommendations for improvement. Furthermore, it examines Human Resource Development (HRD) approaches and suggests ways to enhance them. The study also covers classical motivation theories, such as Maslow's Hierarchy of Needs and Herzberg's Two-Factor Theory, along with a hybrid theory, analyzing their implications for organizational value. Finally, the report discusses the characteristics of effective leaders and relevant leadership models to justify the analysis, offering a holistic view of H&M's human capital and leadership practices.

MANAGING HUMAN
CAPITAL AND LEADERSHIP

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Relevant models and analyses of approaches of the company to Human resource management
................................................................................................................................................3
TASK 2............................................................................................................................................6
Recruitment and selection in relation to strategic HR initiatives and recommendation for
improvement...........................................................................................................................6
TASK 3............................................................................................................................................8
Approaches of HRD and ways of improving these................................................................8
TASK 4..........................................................................................................................................10
Maslow Hierarchy Needs Theory.........................................................................................10
Herzberg's Two Factor Theory.............................................................................................11
Hybrid Theory .....................................................................................................................11
TASK 5..........................................................................................................................................12
Discussing the characteristics of effective leaders along with relevant models to justifying the
analysis. ...............................................................................................................................12
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Managing human capital is process of obtaining, training, managing and retaining
employees to contribute in workings of organization (Ketchen Jr and et.al., 2017). The key
objective of such a type of task is to train employees for developing them as resource for the
company. The employees act as important resources as they play important role in productivity
of organization. Whereas leadership is act of motivating employees for attainment of company's
goal. Possession of that qualities makes him unique from other and people tend to follow these
individuals. Hennes & Mauritz (H&M) established on 4 October 1947 a Swedish Multinational
retail clothing company for men, women, children and teenager headquartered in Stockholm,
Sweden operating in 62 countries possessing approx 4800 stores employing 140000 manpower
worldwide. The report will cover approaches for management of human resource. Human
Resource initiatives for recruitment and selection will be address along with recommendation to
develop the process. Further, approaches for Human Resource Development will be briefed
along with areas that can be improved. Finally, classical theories of motivation will be address
along with its implication on value of organization alongside providing characteristics of
effective leader in the smooth functioning of the organization.
TASK 1
Relevant models and analyses of approaches of the company to Human resource management
The approaches of Hennes and Mauritz to manage it's human resource aims on managing
programs for people management for development of long term solutions for concluding
inventions along with ensuring employees fit well in organization alongside adding value to its
practices for the ultimate goal to achieve organizational defined goal. The Hennes and Mauritz
can manage its human resource by applicability of following approaches for the attainment of
their final desired objectives.
Human Resource Value Chain Model
Human Resource function is collective activities an employee consider settling down to
perform managerial activities to fullest. Value chain reflects total value, consisting value
activities and potential where value activities are basic activities by which human resource built
employee based on learning and motivation. Where potential is capability of individual which
has been developed by the support of value activities.

The impact of human resource value chain model in Hennes and Mauritz will divide the
model in three aspect namely Human Resource activities, human resource outcomes and impact
on organizational objective. The objective of human resource management for Hennes and
Mauritz will plan for workforce activities, recruitment and selection of employees, offering
compensation and benefits, training of employees alongside managing their talent in right
direction, maintaining organizational relation for Hennes and Mauritz for employees and
management (Yin and et.al., 2017).
The applicability of these practices aims at achievement of employee engagement in
Hennes and Mauritz for operational activities, assuring their retention and boosting up the
performances. The effect of these practices in Hennes and Mauritz will lead to reduction and
control of workforce cost, elimination of unnecessary absent ism and ensure employee retention
for organizational activities and functions.
Therefore, the effect of these practices will result in increased profit margins, alongside
affecting market share and market value for Hennes and Mauritz products and services increase
customer satisfaction upon their product and services. The involvement of type of factor also will
boost up moral values for H&M improving fairness in their working conditions and procedures.
Guest Model
Guest model is type of model developed in 1997 by David Guest that aims on assuming
HR manager has specifies strategies to begin with that requires several practices that result in
outcomes when are executed. The outcome may of type of behavioural performance along with
financial rewards. The model contains several components such as Human Resource practices,
Human Resource strategies, Behavioural outcomes, Human Resource outcomes, Performance
results along with Financial Consequences.
The applicability of type of approach that is guest model in Hennes and Mauritz for
reconstructing HRM practices competing more effectively in marketplace. The model focuses on
emphasis of assumptions of HR manager possess several strategies to begin and holds several
conclusion criteria when developed plan to execute those outcomes. Hennes and Mauritz if
practice this model will achieve desired outcome in following ways.

The type of model in Henns and Mauritz will result in Human Resource Management
practices performing task of hiring effective and qualified staff for performance of managerial
activities, further training is being provided about the work practices a working condition of the
organization to maintain a defined amount of quality and efficiency in staff or employees of
Hennes and Mauritz. The practices of human resource plan in Hennes and Mauritz (H&M) will
result in providing quality of working conditions by providing them flexibility that aim to
commitment of employees for attainment of organizational goal in Hennes and Mauritz (H&M).
The implementation of these practices by human resource department for Hennes and Mauritz
might withdraw outcomes covering both the aspects positive side and negative side by
applicability of this activity such as implementation of human resource practices will affect
positive side by inviting innovation for working conditions, on providing the quality for product
to meet the current market and customers needs and desire serving them with improved and

better quality of garments providing overall productivity of process (Yang and et.al., 2017).
Whereas, implementation of such practices in workplace can result in employee turnover
affecting their satisfaction factor which may result in increase of absent ism and affect the
productivity of employees of Henns and Mauritz. Finally, the implementation of proper human
resource practices for management of human aspect of Henns and Mauritz will boost up
productivity of their working conditions by managing proper efficient practices by employees
resulting in effective profit outcomes and estimated return on investment for the company.
Hence, Henns and Mauritz to mange it's human resource for working conditions can use
human resource value chain model and guest model to evaluate if management of their
manpower if being diverted in right direction and order or not along with holds several measures
to ensure their effective working condition in the organization for effective output of
organizational results.
TASK 2
Recruitment and selection in relation to strategic HR initiatives and recommendation for
improvement
HR also plays an important role as it plays several functions like recruitment and
selection, motivation, training, performance appraisal that all help the company in achieving
their aims and vision. According to the Otoo and et.al., (2019)Recruitment and selection is an
important part and activity of recruitment and selection and by employing selective processes the
company can accomplish their goals and achieve success. Recruitment and selection of skilled
and right candidates can reduce the cost of the company. Some functions of HR of H&M
company, along with recruitment and selection are being described as followed:
Recruitment and selection: It is called the first and important function of HR without
which H&M can not perform further tasks. It is known that employees in different departments
perform several functions. Recruitment is a process of finding several candidates and attract
them towards the company. According to the Cascio, (2015) Selection is a procedure of selecting
the best candidate amongst all candidates. Without employees and skilled workforce H&M can
not earn money and accomplish its goals. So, it can be said that by performing this function with
an effective strategy, HR can fill the vacant job. On the basis of candidates skills, abilities, HR
sources the best candidate.

There are two methods of recruiting employees such as internal and external. It is stated
that the process of recruitment and selection is a quite longer than its competitors and other
companies (RECRUITMENT AND SELECTION OF H&M, 2019). They look for interest which
candidates posses for selecting in the company. They give more preference to personal qualities
rather than formal qualification at the time of selection of candidates. The main aim of looking
for eight attitude and personality is, it believes that these qualities can not be taught. In the
context of strategic management of H&M of recruitment and selection, it is followed by panel of
interviews. Recruitment process of H&M includes both internal and external type. As per the
view of Chan and et.al., (2017), in the type of internal recruitment, the company hire
candidates from their own existing staff and this is called the first preference of recruiting
employees. On the other hand, in external type, it encourages outside people to apply for the job.
It mainly focuses on recruiting local people for its new stores. It has more part-time employees
as compare to full time employees. Some sources of recruitment include:
External recruitment
Advertisement: It is an external recruitment process in which HR of H&M gives an
attractive advertisement in newspaper as well as in professional journals. By adopting this
method it can make a wider pool of skilled workforce within its organization.
Educational institutes: It is a part of direct recruitment as by contacting to educational
institutes, it can get employees who have new and fresh ideas regarding job role and fashion
industry. So, it can be said that this can be more beneficial for employers as well as employees
(Ye, de Salas and Ollington, 2016).
Internal recruitment
Transfer: It is a type of internal recruitment in which, H&R shifts its existing employees
from present job to other jobs. It is time and cost saving process that is why this mainly focuses
on this source.
Promotion: It is little different from transfers in which company promote their existing
employees to higher position. The main aim of this source is to increase employees retention and
motivation. When employees get promoted that it increases their morale and satisfaction level.
Recommendations
From the above study of recruitment and selection strategy it is identified that the
company mainly focuses on recruiting their existing staff rather than recruiting from outside.

Internal recruitment is somehow effective as it reduces cost but on the other hand it limits the
pool of new ideas and skilled workforce. So, as a HRM consultant it can be recommended to the
company that it should focus on external recruitment. By hiring employees from outside it can
know about news trends of fashion and can also make an effective use of their skills.
It is also stated that this company focuses on face to face and panel interviews which
builds pressure on candidates and sometimes candidates can not answer of questions. Due to
time constraints, interviewers ask limited questions which sometimes can not fulfil the job
criteria. They should also focus on online recruitment process as it can reduce their cost and
sometimes employees from remote areas can not come at office for giving interviews. So, by
taking online interviews it can even get skilled workforces which can be beneficial for both
employees and employers. By making an effective strategy of recruitment and hiring process,
they can increase effectiveness of this function.
TASK 3
Approaches of HRD and ways of improving these
In the context of H&M it is stated that this company is now more focusing on, On-the-job
training, just in time approach and experimental self directed learning. As per the view of
Ekwoaba, Ikeije and Ufoma, (2015) Human resource development means to make an effective
use of all those things and perform activities which can improve individuals, group and
organizational effectiveness. It includes training, career development, performance appraisal etc.
The main aim of H&M of developing HR practices or approaches of HRD are developing
capabilities of individuals, to increase relationship with employees, to develop team spirit etc.
Some approaches are being described as follows: Integrative framework approach in which
comp-any focuses on improving employees satisfaction. Human capital appraisal approach is
also being used by this company in which the company focuses on reward management,
recruitment, retention of employees, organizational structure etc. People capability maturity
model is another important approach that is also be used by this company. In this approach,
H&M provide training and proper guidance to employees and motivate them. Some ways by
which this company improve HRD approaches are:
Training and development: Training and development is called the best approach of
HRD which is being used by the company. By using this approach they can increase skills of
employees which they need to improve. By improving all those skills, HR manager and

employees can increase overall productivity of the company and increase relationship with
employees which is the main aim of HRD approaches. It is stated that training period is varied
and depends on staff to staff. So, it can be said that H&M only focuses on hands on and on the
job learning (Bournois, Chauchat and Roussillon, 2017).
Performance appraisal: H&M uses strategic as well as integrated approach for
performance management. Employees growth and organizational growth are interrelated so, it is
important for H&M to focus on employees needs and their performance. By reviewing
effectiveness of performance of employees at the end of financial year it performs performance
appraisal or performance management. With the help of Employee self assessment methods also
it makes this approach more successful. In this type employees are allowed to assess themselves
and give grades according to their views as what they have felt and in which field they made
improvements etc. It increases their critical thinking skills and provide satisfaction as well.
Employee rewards: In the context of reward management strategy it can be said that this
company offers several benefits to employees like staff discounts, bonuses, incentives, health
care and pension scheme. Its reward management strategy is interrelated with HR strategy which
is job rotation, part-time job that is a part of flexible working hours, open doors etc. It mainly
focuses on financial rewards rather than non-financial rewards and benefits. So, it can be said
that by providing all these rewards it motivates them towards accomplishing organizational goals
(Shuck, Zigarmi and Owen, 2015).
So, it can be said that H&M uses several effective strategies for HRD approaches and
motivating employees for accomplishing goals. There is a requirement for this company to more
focus on some strategies and approaches of HRD for becoming the market leaders in its industry.
Some recommendations and ways of improving approaches of HRD are being described.
Ways of improving:
In the context of improvements of HRD approaches it can be recommended to the
company that it should make an effective use of Bamboo HR software that allows manager to
track attendance of employees, evaluation of their performance and payroll administration as
well. It provides all those informations which can help them in satisfying needs of employees. It
should also focus on non-financial rewards for motivating employees as per the needs of their.
Some employees want to be praised and recognized in front of others. So, it can recognize, praise
them and promote them for improving HRD approaches.

With the help of Smart recruiter software also, it can get skilled workforce. In order to
complete hiring function without compromising the quality, it can make this use. The main
characteristic of this tool is, this software can be accessed in mobile phones as well. In addition,
it can also be said that 360 degree feedback also play an important role in HRD. By taking
feedbacks from customers, employees performance can be determined. On the basis of
performance of employees, HR manager of H&M can increase effectiveness of performance
appraisal approach. It does not use HRD score card approach, so it can use this approach as well.
TASK 4
Hennes & Mauritz is a multinational company for which serves a variety of clothing for women,
men and children. The classical theory for motivation theory includes Maslow Hierarchy Needs
Theory and Herzberg's Two Factor Theory, which are adopted by the company to motivate the
employees so that they can work effectively and efficiently.
Maslow Hierarchy Needs Theory
This theory describes the needs of each individual in a hierarchy level and to motivate
them with the needs which are unsatisfied, so that they perform efficiently with an urge to fulfill
those needs(Alshmemri, Shahwan-Akl and Maude, 2017). Psychological Needs: It includes the basic need of food, clothing, air, shelter, etc. which
are the basic resources of life and H&M are providing these facilities to its employees. Safety Needs: It includes the security and protection in regard to physical, environment,
social, etc. which consists of security of health, job, family. By providing this the
employee will be retained and work for further progress of the company. Social Needs: The needs related to care, affection, friendship, and a co-operative and
coordinating group at the workplace will create a sense of positivity and oneness among
the employees((Healy, 2016)). Regular interaction of Top level management of H&M
will also help in maximizing the motivation. Esteem Needs: It relates to the status of employee both in internal and external
environment of job. By building self-respect, power, confidence of an employee he will
be motivated more and will work efficiently in achievement of goals and targets of
H&M.
 Self-Actualization Needs: It is the peak level of the needs where the employee work to
gain more knowledge and develop skills(Acevedo, 2018). And grow psychologically so

that more and more opportunities are made into reality and achievement of the same by
H&M employees in order to grow globally.
Herzberg's Two Factor Theory
According to Herzberg theory there are some factors which helps in gaining satisfaction
of employees and some factors tends to hinder dissatisfaction.
Hygiene Factors
These factors are highly required by H&M so that the motivation is always there in in the
employees, as they help in pacifying the employees and are also reasonable in a job and motivate
them to work efficiently(Alshmemri, Shahwan-Akl and Maude, 2017). It includes: Pay: the pay structure at each level of H&M should be appropriate enough and should be
according to the skills and qualification of employee. There should be no discrimination
on the basis of pay. Physical Working Conditions: The environment of the organization should be neat, clean
and breathable. Employee of H&M should provide a hygienic surroundings to its
employees, so that it is easy for them to work in a positive environment efficiently.
Motivational Factors
As these factors are known as satisfiers, they help the employees of H&M to motivate
themselves for better performance and reach the target set in an efficient manner. Responsibility: By minimizing the pressure and control by higher level, will create a
sense of responsibility and accountability among employees of the tasks
assigned(Herzberg, 2017). This will help them in working effectively with more
confidence and motivation foe H&M.
 Growth & Promotional opportunities: The employee of H&M should be provided with
new tasks and growth opportunity so that they will be more motivated and it will result in
completion of task and performance very well.
Hybrid Theory
These above mentioned theories of motivation should be adopted by H&M in a hybrid
way, that is, along with fulfilling the needs of various levels from low to high of the employees.
They should also consider the factors such as motivational and hygiene which are responsible for
growth and faster achievement of the set targets and goals(Lichtenberg, Lachmann and Fosshage,
2016). By motivating the employees through both the theories, the employees will be fully

satisfied with H&M and will work with full efficiency in completion of their task and helping
the organization to grow globally.
TASK 5
Discussing the characteristics of effective leaders along with relevant models to justifying the
analysis.
Successful leader are the powerful and intellect behind their organizations. Leaders are
the most effective and creative personality which motivate other employees to perform their
duties into detailed and effective manner (Rosenbach, 2018). Somehow, leaders have the
capability of boss as well as managers. Here it presents some essential characteristics found in
every leader within the organization.
Self Managing
it is the difficult task to manage people. Self managing means to manage itself and well
able to prioritize the own goals and being accomplishing those objectives in productive manner.
Such activity makes the person good leader. Individual person should know its own strength and
weaknesses that helps in making decision making process. Self managing leaders are highly
productive and efficient in their own context that makes the study more engaging and following
business task. Apart from that, it better understand the opportunity and gain that makes the more
effective learning approach.
Ability to influence others
Leadership is all about influencing others. This is the core characteristic of a successful
leaders (Leithwood and Azah, 2016). Influencing other people requires building trust among
others which is a transparent process. Influential leaders in H&M can helpful to improve the
employees and working productivity.
Risk Taking and Innovative
Every leader must take risk and new chances to grab opportunity which makes normal
person to a leader. Risk taking process brings new modern concepts and innovation ideas which
makes the company differentiate with other brand.
Value ethics and Integrity
A grate leader has always follows ethics and legal work ethics which makes them
different from other people (Lumpkin, 2016). Leaders has never break the laws. On the same