Strategic Human Resource Management: A Case Study of Alpha Company

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STRATEGIC HUMAN RESOURCE
MANAGEMENT
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Contents
INTRODUCTION............................................................................................................................. 3
DISCUSSION................................................................................................................................... 3
THREE DOMINANT IHRM ISSUES/CHALLENGES.........................................................................3
PROBLEM-SOLVING APPROACH.................................................................................................5
RECOMMENDATIONS................................................................................................................ 6
CONCLUSION................................................................................................................................. 7
REFERENCES.................................................................................................................................10
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INTRODUCTION
Human resource management is the most significant part of any organization and even several
companies use it to gain a competitive advantage in the market. Even the multinational
companies have taken the concept of SHRM very seriously for entering into global market
(Brewster et al., 2016). This case study has included some of the HRM issues of Alpha Company
which provides IT and consulting services. The company has its operations in more than 44
countries employing more than 45,000 professionals. The company gives complete freedom to
their employees because they believe that after treating them an important part of the company
they will give their best performance and gives them a reasonable return. Although there were
some issues faced by the company which does not give positive results to a company which is
also described in this report (Reiche et al., 2016).
DISCUSSION
THREE DOMINANT IHRM ISSUES/CHALLENGES
Starting operations in the global market are a very complex task for the MNCs due to several
complexities and challenges. The success of the companies depends on its human resources and
the complexities start when they were hired from different backgrounds and culture. There are
several issues identified in the IHRM of the Alpha and some of these are as follows:
1. Organization context
The Alpha service adopted international corporate strategy as this organization provides
different IT and consulting services to different countries. To expand the business globally,
Alpha has control over its subsidiaries and the headquarters controls the activities of
subsidiaries. The Alpha is adopting a wholly-owned subsidiary where the employers give
complete freedom to employees to take their decision. In order to successfully operate in the
international market, there must be coordination between its headquarters and subsidiaries. It
is quite difficult for the Alpha, to maintain the balance between ‘push for control from
headquarters’ and ‘pull for autonomy from subsidiaries’. The company’s headquarters tries to
put its control on its subsidiaries through developing and executing some strategies. On the
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other hand, the top management gives complete freedom to their employees about their work.
Therefore pressurizing them to work as per the rules and regulations is difficult for them
(Baum, 2016).
2. Staffing, recruitment, selection, and retention
In order to retain qualified and skilled employees, the company treats the employees like
their CEO and gives them complete authority and responsibility to take the decision. Further,
the recruitment policy adopted by the Alpha is lateral recruitment and campus recruitment.
From the lateral recruitment, the employees who have skills get a chance to become
promoted and from campus recruitment, the company gets fresh experts which may bring
innovative ideas in the business. This strategy demotivates the existing employees which do
not get a chance of getting being promoted (DeCenzo et al., 2016). The main reasons which
hampered the global staffing of Alpha are that company need cost-effectiveness while
executing the business project in India, the people are less attractive to choose IT as their
career and also the employees of IT has some poor perception about the company.
3. International performance management- compensation and training
The company has the policy that it will follow the remuneration strategy on a fixed and
variable basis. But it follows the same strategy in all places irrespective of the other factors.
The company gives fixed pay to all employees and variable pay depends on the performance
of individuals, teams and according to units. However, fixed pay changes according to local
laws and regulations. Further, the employers also give some tags to employees as per their
performance and put the people under a performance improvement plan who was not able to
achieve their targets. This may demotivate, decrease their morale or even they were rejected
by other employees. After putting all responsibilities and accountability on an employee, the
employer expects that they will fulfill their expectations but the inability to do so will
demotivate them (Sekiguchi et al., 2016).
It is also found in the Alpha that training and development program is only available for
those who require this and it does not provide any opportunity to other people who have
essential skills and knowledge. The commitment of employees can be only ensured through
different opportunities and regular training so that they become competent to work on the
most challenging tasks. The company has successfully set up the learning programs and other
corporate learning centers in India as well as at other centers. This training program aims to
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fulfill 80% of the leadership requirement within the organization. In addition to this, the
company wants to accomplish the extraordinary task of ordinary people. And the aim of the
people is only to motivate the people to give their best performance. But this will apply to
those who do not have the necessary skills and knowledge. It does not open up the
opportunities and growth for other people in India. Due to this reason, people are showing
less interest in IT and consulting sectors.
PROBLEM-SOLVING APPROACH
This problem can be identified when the employee’s turnover was high and also when Alpha was
not able to find competent and qualified personnel for their vacant position. However, in order to
solve the above-mentioned issues and challenges, the company can apply the ADKAR model
which is five important aspects of changing the culture and organizational structure of the Alpha.
The ADKAR model stands for:
Awareness
In the initial stage, the employers should analyze the factors which bring negative results or
which demand change in the organization. And this can be evidenced from investing huge
resources on training and development, facing difficulties in retaining the employees even after
providing quality of services. All these factors show that there is a requirement to assess its
internal policy or framework and requires a change in HRM functions (Dana et al., 2016).
Desire
In the second stage, the management of Alpha should have the desire to change its internal HRM
strategy. The company is a well-established company and successfully operates in other
countries as well but continuing the same HRM approach may damage its image or reputation in
the international market. If the employees are not satisfied with the current HRM strategy, they
will contribute their best for the success of the organization.
Knowledge
The requirement of changing the situation or finding the solution to the problem will be clear
from getting regular feedback from the employees. There should be proper arrangement for
employees that they will share their problems and issues with the employers so that they can
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solve the problems accordingly. If the employee’s problem were related to their remuneration
then they should also discuss with their employers i.e. the remuneration policy should not only
be according to the law but it should also consider other aspects of the employees such as rent
and other expenses.
Ability
The Alpha can also hire an expert who can work on finding the problems of employees and
transfer it to top management and also suggest some solutions to them. Only telling it top
management is not sufficient for employees but they expect that top management will find some
solutions to their problems. This is the only way to solve the issues described in the above
section (Goyal & Patwardhan, 2018).
Reinforcement
In the reinforcement stage, after amending the changes in the organization’s HRM policy, the
employers should formally tell it to their employees so that they get information about the
changes and the impact of these changes on the employee’s job. This is the most important task
where the employers take feedback from the employers and compare the difference between the
results.
RECOMMENDATIONS
The problems identified in the above section can be solved by following these strategies or
approaches:
1. Organizational context
The problem found in the Alpha is a democratic style of leadership, decentralization, and
non-hierarchal organization structure. Due to this freedom, some employees are taken for
granted and do not contribute their best for organization success. And when the top
management from the headquarter gives order to employees they do not obey them. As per
the opinion of Haneda & Ito, (2018), this problem can be solved by assigning one individual
who monitors the performance of employees and coordinates with the headquarters so that
orders should be executed effectively.
2. Staffing, recruitment, selection, and retention
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In order to improve the morale of existing employees, the management should start recruiting
employees from other sources as well and give opportunities to them. For instance, transfer,
employee referrals, competitors, internal advertisement, etc. And also it is found that people
are taking less interest in IT sector due to lack of opportunities, this problem can be solved
through job rotation, the employees should get different job roles so that they feel interested
while working in the Alpha.
3. International performance management- compensation and training
The employees are not satisfied with their current compensation and remuneration policy as
they feel that they are not adequately paid for their services. However, the Alpha follows the
remuneration strategy as per the laws and regulations of the country. This problem can be
solved by increasing their salary as per their contribution to the Alpha. The hike in the salary
can be justified after analyzing their past performance.
As per the study of Baraldi & Cifalinò, (2015) the problem of providing training to only
those who do not have skills can be solved by arranging different sessions for all employees
so that all can participate and learn some important points related to their job.
CONCLUSION
Implementation Plan for the most pertinent challenge (International performance
management- compensation and training)
All these three challenges affect a company's success and operations. Among these three
challenges, the most pertinent challenge which affects the business operation is the last one i.e.
international performance management- compensation and training. This is because when the
company decided to expand its operation in the international market, it has to change its uniform
HRM policies and practices as per the needs of employees and other external factors. From the
above-mentioned challenges, it is recommended that the HRM department of the Alpha should
draft different policies related to compensation and training so that it must be implemented
progressively and give positive results. The reason for choosing this challenge is that the
contribution of the company decides the success of an organization.
These recommendations have both positive and negative implication on the employees as well as
employers. For employees, it will bring opportunities in terms of growth and increase in salary.
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But it will negatively affect the employees, if they were not able to increase their productivity
due to some unavoidable circumstances in this situation, the employee’s performance and salary
both will decline. From the perspective of employers, the positive aspect of the compensation
and training is that it will increase the productivity of employees which help it to increase its
revenue and on the contrary to this, the Alpha has to invest huge amount on arranging sessions
for employees and other related expenses and also on giving salaries to employees.
As per the problem identified, the consultant would like to suggest to follow these steps for
changing the training and remuneration strategy in the Alpha. The steps which helped the
company to improve this situation by implementing these steps are as follows:
 On the orientation day, the company should introduce the vision, mission, and objectives
of the company and also the code of conduct of employees. Further, the management of
Alpha should also introduce its new incentive plan i.e. the remuneration will be given as
per their contribution in the organization plus fixed salary. And also about the training
methods, i.e. customized training sessions will be arranged as per individual needs and
some other sessions will be organized by the Alpha so that all employees will equally
participate in the same.
 But after the sessions, the employees were provided a handbook which tests their
learning and increase in their current knowledge. After different sessions, the employee’s
progress was recorded and then they will get promotion as per their progress.
 Moreover, the company should give a basic salary and afterward the hike in the salary
will depend on the progress and their contribution. The performance appraisal can be
done after every 3 or 6 months. With this strategy, the employees will be motivated and
they also feel a sense of achievement.
 The management should also disclose the grading criteria for measuring the performance
such as customer reviews, teamwork, quality of results, absenteeism, overtime, etc.
 After the fair analysis, the employees should get both opportunities for growth as well as
hike in the remuneration so that they can feel connected with the Alpha for a long time.
It becomes difficult for the company to analyze the performance of an individual if the
work is performed in a team but the leader should fairly analyze their performance and
record them accordingly.
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The time table of this implementation plan can be prepared with the help of a Gantt chart which
divided the whole plan into a small achievable task and the time required to complete each
activity. The template of the Gantt chart which Alpha can use in its implementation plan is as
follows:
Figure 1: Gantt chart
The responsibilities of employers and employees are clearly described in the implementation
plan and it is expected that all parties should follow them properly. However, the managers
should take the follow-up of the activities to ensure the success of the implementation plan.
Although, several external factors such as demand of customers, competitors, government
policies, technological factors, etc. may negatively affect the success of the implementation plan.
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REFERENCES
Baraldi, S., & Cifalinò, A. (2015). Delivering training strategies: the balanced scorecard at
work. International Journal of Training and Development, 19(3), 179-198.
Baum, T. (Ed.). (2016). Human resource issues in international tourism. Elsevier.
Brewster, C., Vernon, G., Sparrow, P., & Houldsworth, E. (2016). International human resource
management. Kogan Page Publishers.
Dana, B. G., Mukaj, L., & Vishkurti, M. (2016). Creating a model culture of management
change. Annals of the University of Oradea, Economic Science Series, 25(1), 871-880.
DeCenzo, D. A., Robbins, S. P., & Verhulst, S. L. (2016). Fundamentals of Human Resource
Management, Binder Ready Version. John Wiley & Sons.
Goyal, C., & Patwardhan, M. (2018). Role of change management using the ADKAR model: a
study of the gender perspective in a leading bank organization of India. International Journal of
Human Resources Development and Management, 18(3-4), 297-316.
Haneda, S., & Ito, K. (2018). Organizational and human resource management and innovation:
Which management practices are linked to product and/or process innovation?. Research
Policy, 47(1), 194-208.
Reiche, B. S., Stahl, G. K., Mendenhall, M. E., & Oddou, G. R. (Eds.). (2016). Readings and
cases in international human resource management. Taylor & Francis.
Sekiguchi, T., Froese, F. J., & Iguchi, C. (2016). International human resource management of
Japanese multinational corporations: Challenges and future directions. Asian Business &
Management, 15(2), 83-109.
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