MGT5OBR: Group Report - Organisational Behaviour at ABC Tech Solutions

This report analyzes the organizational behaviour challenges faced by ABC Tech Solutions, a global technology firm, particularly within its Australian subsidiary. The report identifies key issues in human resource management, including inefficient recruitment and selection processes, a lack of a structured performance management system, and low employee motivation leading to high turnover. It explores the lack of diversity in the workforce, the over-reliance on external recruitment, and the absence of standardized recruitment processes. The report proposes solutions such as implementing job analysis, adopting a geocentric staffing approach, and focusing on internal recruitment to improve the recruitment and selection process. Furthermore, it recommends redesigning the performance management system to include goal setting, regular feedback, and performance appraisals. The report emphasizes the importance of employee motivation and engagement, suggesting strategies to improve employee morale and reduce turnover. The report provides an in-depth analysis of these issues and offers practical recommendations to enhance the performance of ABC Tech Solutions' Australian subsidiary by strengthening its human resource management functions.

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ORGANISATIONAL BEHAVIOUR –
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Table of Contents
Introduction.......................................................................................................................3
Human Resource Management Issues and Solutions..........................................................4
Recruitment & Selection..............................................................................................................4
Performance Management..........................................................................................................7
Employee Motivation...................................................................................................................8
High Employee Turnover............................................................................................................11
Conclusion.......................................................................................................................12
References.......................................................................................................................13

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Introduction
ABC Tech Solutions is a private firm that operates in the information technology sector and
manufactures technology related products and services. The company was founded in the late
1970s in America and as of today, it has its operations running throughout the globe. The
company has its headquarters in Virginia and offers a number of products and services to the
customers, such as smartphones, application development software, cloud storage, search
engine, e-mail client, etc. ABC has a workforce of 148,400 employees working for it
throughout the globe. Some of the major competitors of the company, in the global market,
are Google, Yahoo, Hotmail and Apple.
Recently, the company has been facing a number of difficulties in managing its human
resources that are working in the Australian subsidiary. The company had expanded its
operations in Australia in the late 90s and has been operating there quite smoothly since the
last year. The condition of the human resources in the Australian subsidiary is the worst,
which is also having an adverse impact on the performance and efficiency of the subsidiary.
The company fears that if the present condition of the Australian subsidiary remains
unchecked, it would have an adverse impact on the global market position of the company
and will also result in a loss of its market share.
Some of the major problems that are being encountered in the Australian subsidiary, with
respect to the management of human resources, are high labour turnover ratios, lack of a
performance management system, lack of employee motivation, etc. These human resource
conditions, along with a lack of a performance management system, have been making it
difficult for the company to achieve its desired performance objectives. As a result, it has lost
some part of its market share in Australia and the condition has gained media attention, which
is acting in favour of the competitors.
The prevailing human resource conditions have been haunting the senior level management
and the management has decided to implement a major human resource development
intervention, which would be aimed at improving the performance of the subsidiary by
strengthening its human resource management functions. Therefore, in this report, we will

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gain a deeper insight into the inefficient human resource management areas of the subsidiary
and design appropriate functions to deal with the present conditions.
Human Resource Management Issues and Solutions
Human resource management is a concept that aims at improving employee-employer
relations and workplace conditions in order to optimise employee performance in a business
setup (Brewster, Vernon, Sparrow, & Houldsworth, 2016). Efficient human resource
management in business organisations can do wonders. It can help a company in becoming a
top performer in the industry while inefficient human resource management can deprive
business organizations of their competitive advantages and market shares (Noe, Hollenbeck,
Gerhart, & Wright, 2017). Further, human resources are the only resources which cannot be
easily replicated, unlike other resources and processes, which increase the reliability of
business organizations on their human resources even more (Cascio, 2015). Thus, efficient
human resource management is of an utmost important in the present day business
environment. The four key human resource management areas where ABC Tech Solutions
lack efficiency are discussed below:
Recruitment & Selection
Recruitment and selection is as a process of advertising, inviting and screening job
applications to hire potential candidates in order to fulfil human resource demands of a
workplace. Recruitment and selection is one of the core functions in human resource
management that is essential for the smooth functioning of an organisation (Farndale,
Nikandrou, & Panayotopoulou, 2018). In absence of recruitment and selection, business
organizations can face a shortage of staff and can find it difficult to carry out their day to day
operations and processes.
Recruitment and selection at ABC Tech solutions is not as efficient as it should have been.
First of all, the workforce in the Australian subsidiary is not diverse in nature. ABC is a
global company but it has largely failed to make use of economies of scale and recruit
employees from different cultural backgrounds and countries to work in its Australian
subsidiary. 95% of the employees working in the Australian subsidiary are Australians by
origin while 3% belong to the United States and the other two belong to third countries. The
inability of the company to recruit a diverse workforce has been having an impact on its

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competencies as the overall skills and competencies are merely reduced to that of the home
country (Trehan & Glover, 2019).
Secondly, the company has been focusing more on external recruitment and selection
methods for fulfilling its staffing needs and has never dedicated itself to internal recruitment
and selection methods. The company has been carrying out recruitment and selection drives
on an annual basis, which mostly comprises of inviting job applications through social media,
consulting employment exchange companies and campus recruitment (S., 2018). The
inability of the company to stress upon internal recruitment has lowered down the career
development opportunities that could have been extended to the existing employees. Lack of
career development opportunities are further limiting the possibility of promotions, job
rotations, etc. for the employees and they have been working in the same job positions for
more than a couple of years. The lack of career development opportunities is having a
negative impact on employee morale and they have started to experience work related stress
(Trivikram, 2017).
Thirdly, the recruitment and selection process of the Australian subsidiary has not been
standardized by the management. A standardized recruitment and selection process comprises
of a fixed selection criteria, which is followed by the recruiters every time they carry out a
recruitment drive. For example, a standardised recruitment process consist of screening
applications, psychometric tests, psychological tests, personal interviews, medical
examination, reference checks and hiring decision respectively. A standardised recruitment
process defines the core values, skills and competencies that a workplace requires and must
be possessed by a candidate in order to get selected (Henshall, 2017).
First of all, to deal with the inefficiencies in the recruitment and selection process, the
Australian subsidiary of ABC Tech Solutions can implement a job analysis model that was
suggested by the founders of I-O psychology, Frederick Winslow Taylor and Lillian Moller
Gilbreth in the early 20th century. Job analysis is a process that is used to determine and list
down the job duties and requirements that would be required in a candidate in order to be
selected for a particular job role (Breaugh, 2017). Job analysis provides a clear cut set of
skills and competencies that a person must possess in order to work efficiently in a job
position, which can be then used by the management to design its recruitment and selection

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process. The management can use the skills and competencies identified in a job analysis to
structure its selection process, which can include typical psychometric and psychological
tests that can test a candidate in particular skill sets and competency areas. This would ensure
that the management is able to identify the right fit for the right job. Finding the right fir for a
job will also help the company in ensuring that its new recruits are able to adjust in the
workplace with an ease and do not show a tendency to quit in the early stage of their
employment (SHRM, 2013). Therefore, clear cut job analysis will be helpful for the company
in strengthening its recruitment and selection process.
Secondly, the company needs to identify a right staffing technique that would cater to the
needs of its Australian subsidiary. Staffing techniques are generally categorized into the
following:
1. Ethnocentric approach  in an ethnocentric staffing approach, majority of the employees in a
host country subsidiary are recruited from the home country itself.
2. Polycentric approach  in a polycentric staffing approach, majority of the employees in a
host country subsidiary are recruited from within the host country itself.
3. Geocentric approach  in this approach, a management decides to staff its subsidiaries with
the most suitable employees without considering their nationality, origin or cultural
background.
4. Regiocentric approach  in this approach, the employees for a workplace are hired from
geographical locations that resemble the host country (Whitehead, 2017).
As ABC Tech Solutions is a global firm, it needs to adopt a geocentric approach for staffing
its foreign subsidiaries as it would not just help the company in developing a diverse
workforce but will also be helpful in discovering and hiring unique and talented employees
from all over the world. A geocentric approach will increase the potential pool of candidates
for the company and the company would be able to invite a greater pool of multitalented
candidates in its recruitment and selection drives.
Thirdly, the company needs to start focusing on internal recruitment and selection process to
have a positive impact on its workforce and to keep them engaged. Internal recruitments are
generally conducted to fulfil job vacancies from the existing workforce of a company through

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promotions, job transfers, job rotations, etc. (Fica, 2018)Internal recruitment process is a
cheaper and faster source of recruitment and also provides career development opportunities
to the existing employees. The criteria for internal recruitments in generally performance
based, which fosters a high performing environment in the workplace. The employees
become more likely to demonstrate high performance levels in order to receive promotions or
a transfer to a better subsidiary. Therefore, internal recruitment not just helps in carrying out
recruitment and selection process at a lesser cost but can also has a positive impact on the
employee well-being (Freeman, 2015).
The three strategies discussed above will have a huge impact on the recruitment and selection
of the company. They would not just strengthen the recruitment and selection process of the
company but will also be helpful in increasing employee engagement, motivation and morale.
Further, an efficient recruitment and selection process will ensure that the company recruits
the right people who would be suitable enough to settle in the work culture of the company,
which will also help the company in ensuring higher retention rates in the long run.
Performance Management
Performance management is an approach that allows human resource managers to plan and
monitor the performance objectives for their employees, teams, departments and the an
organisation on the whole. Performance management has become increasingly important in
the contemporary business world because performance driven companies have the ability to
grab a greater market share in their industries (DeNisi & Murphy, 2017).
Performance management at the Australian subsidiary of ABC Tech Solutions is not as
efficient as it should have been. First of all, there is no clear cut system of performance
management in the subsidiary and performance objectives are merely set up by the managers
themselves. The employees are not involved in the formulation of their performance
objectives in any way and they are just handed over a list of performance objectives that they
are expected to achieve semi-annually and annually. Once they are handed over the
performance objectives, the managers never feel bothered to check their progress or to
provide them a feedback on their regular performance levels. Ultimately, the company not
even takes performance appraisals seriously as the managers themselves conduct a
performance appraisal session at the end of an assessment year, where they verbally praise

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high performers and underperformers are warned in presence of everyone. Such a system of
performance management has been having a toll on the employees as they feel unwanted and
disrespected. Over a period of time, the employees have developed a feeling that performance
is not valued by their managers. As a result, performance in the workplace has taken a back
seat.
The management at ABC needs to redesign its performance management system to include
certain key components that would make it more effective. First of all, the management needs
to include a system of goal setting in its performance management system, as was suggested
by Edwin Locke. Edwin Locke, in his goal setting theory, suggested that goal setting should
be linked with task performance by formulating specific and challenging goals in
coordination with the employees. The theory also states that participation of employees in the
goal setting process makes them more involved in performance management and makes the
goals more realistic and acceptable (Erez, 2015). Thus, performance objectives at ABC
Australia should be set according to the goal setting theory.
Secondly, the management needs to start providing performance feedbacks to the employees
at a regular interval. To do this, the management can implement a system of 360 degree-
feedback system, which aims at providing performance feedback to an employees from his
peers, i.e. juniors, seniors, clients, customers, etc. (Campion, Campion, & Campion, 2015)A
360 degree-feedback system is efficient because it provides performance feedbacks to the
employees from multiple sources, which makes performance feedbacks more accurate and
reliable. A 360 degree-feedback system will provide a detailed insight into the areas where
the employees lack competencies and need to improve. Thus, a continuous feedback system
will make it possible for the management to remain in constant touch with the regular
performance levels of the employees and assess their progress in the achievement of their
performance goals and objectives (Heathfield, 2019).
Lastly, the management needs to include a system of performance appraisal in its
performance management system, which would allow it to deal with underperformers and
high performers in the best possible manner. Using this system, the management will be able
to provide rewards and benefits to high performers, such as verbal appraisals, promotions, job
transfers, incentives, health insurances, etc. while it will also be able to warn the
underperformers and either make their performance goals less competitive or making them

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undergo training and development programs to increase their skills and competencies
(Greene, 2018).
Employee Motivation
Employee motivation is defined as the energy, commitment and efforts that the employees
put in towards the achievement of specific goals and objectives. A motivated workforce can
help an organisation in achieving a higher set of performance goals and objectives. Employee
motivation has also gained importance because of its ability to have a positive impact on
employee well-being and other job related attributes, such as job satisfaction, job
commitment, organisational commitment, etc. The Australian subsidiary of ABC Tech
Solutions has been experiencing a significant drop in its employee motivation levels since the
past couple of years. The decreasing employee motivation levels can be attributed to a
number of factors, which are discussed below;
First of all, employees working in the Australian subsidiary have been experiencing lower
motivation levels because of the absence of a performance management system. As discussed
above, the performance management of the company is highly inefficient and is not
motivating the employees to achieve higher goals and objectives. In lack of specific and
challenging goals, the employees do not get a vision of what they are expected to achieve.
Most of the times, the goals are not even properly communicated to them, which introduced
ambiguity. The managers working in the Australian subsidiary take no notice of individual
performance levels and fail to provide the employees with a regular performance feedback.
As a result, the employees have become bored with their jobs and challenges and do not feel
motivated to work harder for their organisation or for themselves.
Secondly, the subsidiary lacks a reward system, which is one of the prime motivational
factors in the contemporary business world. The management at the Australian subsidiary has
no clear cut reward system, which could be associated with employee performance levels.
Performance appraisals are generally rewarded with verbal appraisals and warnings and there
is no scope for monetary or non-monetary incentives. Thus, lack of rewards has been making
it difficult for the management to remain motivated.

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Thirdly, the management has been failing to provide career development opportunities to its
employees. The lack of a performance management system and a reward system is hindering
the ability of the management to identify those employees who have the ability to take up
higher job positions in the organisational hierarchy. Had the management identified such
employees, it could have offered the employees with career development opportunities.
Further, the lack a training need assessment system also adds up and makes the employees
demotivated because the management is not doing anything to help the employees in
developing their skills and competencies.
To address the issue of employee motivation, the management in the Australian subsidiary of
ABC Tech Solutions can refer to the two factor theory proposed by Herzberg in 1959. In his
theory, Herzberg proposed the effect of two factors i.e. hygiene and motivation factors on
employee motivation. According to the theory, hygiene factors are those factors that are
imperative for motivation to exist in the workplace but do not actually result in motivation. If
hygiene factors are absent in a workplace, it can lead to job dissatisfaction amongst the
employees (Alshmemri, Shahwan-Akl, & Maude, 2017). On the other hand, hygiene factors
are the factors that actually help in motivating employees. motivation factors are generally
related to the job itself and are also called satisfiers as they are perceived to be intrinsically
rewarding. Some examples of hygiene factors are the pay or the compensation awarded to the
employees, the policies of the company, fringe benefits offered to the employees, workplace
conditions, interpersonal relations and job security while some examples of motivational
factors are recognition, sense of achievement, growth opportunities, responsibility,
meaningful and challenging work (Sanjeev & Surya, 2016).
The management of ABC Tech Solution’s Australian subsidiary need to consider the theory
discussed above and make considerable changes in its employee motivational strategies. The
workplace lacks hygiene as well as motivational factors, which is not just demotivating the
employees but is also making them increasingly dissatisfied with their jobs. The management
needs to design a new compensation and benefit program, which can be based upon the
performance levels demonstrated by the employees over an assessment period. In addition to
a competent pay system, the management can also offer fringe benefits, such as health
insurances, extra paid leaves, etc. to the employees on the achievement of their performance
objectives. Further, the management can increase its focus on employee well-being, which

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would comprise of improving workplace conditions (Band, Shah, Sriram, & Appliances,
2016). These strategies will increase job satisfaction amongst the employees and make it
possible for them to feel motivated. Once the hygiene factors are improved, the management
can then work to improve motivational factors. The management can offer rewards and
growth opportunities to the employees in form of training and development programs, which
will help them in gaining new skills and competencies to perform better in their job roles.
The management can also start to offer empowerment to its employees, which would increase
a sense of responsibility and accountability in them, ultimately leading to greater motivation
levels (Johnson, Irizarry, Nguyen, & Maloney, 2018). Thus, the management will be able to
improve employee motivation levels in the workplace by improving hygiene and
motivational factors, as suggested by the Herzberg two factor theory.
High Employee Turnover
Employee turnover rate is defined as the rate at which the outgoing employees of a company
are replaced by new employees. High employee turnover rates imply that a company is
experiencing a significant increase in the number of employees that are leaving the workplace
as compared to the number of new employees that are being recruited to fulfil job vacancies.
High employee turnover is a major area of concern for IT sector companies throughout the
globe and ABC Tech Solutions is no exception. The company has been facing a steep rise in
its employee turnover rates, especially in the Australian subsidiary because of a number of
reasons, which are discussed below:
First of all, the lack of a performance management system is making the job boring and
monotonous for the employees, which causes dissatisfaction amongst them and increases
their tendency to quit (Basu, 2017). Secondly, the lack of a competent benefit and
compensation plan adds up to the misery of the company as most of its talented employees
are being poached by its rival companies in exchange for better compensation and higher
benefits. Thirdly, the lack of growth opportunities is limiting the career development progress
of the employees and they have been showing a preference to work with other companies that
can offer them with better career development opportunities (Martinelli, 2017). Fourthly, the
company does not value employee wellbeing as much as it should. There are negligible
employee welfare activities that take place on the job itself and the company has not even
arranged for on-the-job recreational activities, which is of a great help to employees in

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dealing with work related stress (Jones, 2018). Lastly, the company does not offer work-life
balance initiatives to its employees. The lack of work-life balance initiatives have been
making it difficult for the employees to manage their work obligations and personal
obligations side by side, which is causing burnouts and stress amongst them. All these factors
are adding up and making it difficult for the company to retain its talented employees, which
in-turn is making the company less efficient and profitable (Marcum, 2015).
To employee retention rates, the company can make use of the suggestions made by the Job
Embeddedness Theory. According to this theory, the connection of employees with their
organizations is the factor that decides whether they would leave their job or stay. If the
employees feel that they fit into their jobs and have the necessary job skills, they would
prefer to stay with their organizations for a longer period of time. Further, interpersonal
relations also have an effect on the turnover intentions of the employees. If they have good
interpersonal relations, their decision to quit will mean that they would have to sacrifice their
relations that they have nurtured with their co-workers over a period of time.
Based upon this theory, the management at ABC Tech Solutions needs to ensure that it
creates an environment where the employees feel embedded in their jobs. The work should be
made interesting and challenging for them and good interpersonal relations should be fostered
at all costs. The work environment should be made favourable for the employees and they
should be taught all the necessary skills and competencies that they would require to perform
better in their jobs. Once such an environment is created in the workplace, the employees
would feel more embedded in their jobs and would show a lesser tendency to quit (Holtom &
Darabi, 2018).
Conclusion
ABC Tech Solutions is facing a serious problem in the management of its human resources.
Lack of an effective recruitment and selection, a performance management system, employee
motivation and retention strategies will have long term implications for the company as it
would lead to higher employee turnover, decrease in employee job satisfaction levels, job
commitment, organisational commitment, motivation and morale. Such a condition would
make the subsidiary unfit for the employees to work in and would spoil its market reputation