Strategic Human Resource Management at Virgin Group: A Report

This report provides a comprehensive analysis of Strategic Human Resource Management (SHRM) practices within the Virgin Group. It explores the impact of leadership development and reward management on the company's SHRM goals, particularly employee engagement. The report examines Richard Branson's democratic leadership style and its influence on employee motivation and commitment, highlighting the importance of listening, learning, and laughter in the workplace. It also delves into the role of leadership development programs and their contribution to employee growth and satisfaction. Furthermore, the report assesses the effectiveness of reward management strategies, including intrinsic and extrinsic rewards, in aligning with employee needs and driving engagement. It also considers the implications of different leadership approaches, such as autocratic leadership, in specific situations. The report concludes by emphasizing the positive impact of effective leadership and reward practices on Virgin Group's overall SHRM objectives and business success.

STRATEGIC HUMAN RESOURCE
MANAGEMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................2
Impact of leadership development on the strategic HRM goal of Virgin group....................2
Impact of reward management on Virgin Group SHRM goal...............................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
APPENDIX....................................................................................................................................11
Individual reflection.............................................................................................................11

ILLUSTRATION INDEX
Illustration 1: Fiedler's contingency model......................................................................................3
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INTRODUCTION
Strategic Human Resource Management (SHRM) is the practice of linking the HR
(Human Resource) functions of the enterprises with the long term or tactical goals of firm
(Defining SHRM, 2016). In today's scenario, different HR functions are done by the strategic
partners as they are playing very important role in terms of attaining the long term goals and
objectives of enterprises. For the present report, Virgin Group is selected. It is the British
multinational firm which was founded by Nik Powell and Richard Branson in the year 1970. The
firm has around 50,000 employees who dedicatedly work towards the objectives of corporation.
Furthermore, the corporation offers range of products and services to its buyers such as banking,
internet, jewelry and radio etc (Virgin, 2016). For the present report, two HRM (Human
Resource Management) topics are selected which are reward management and leadership
development. The report will showcases the impact of these selected topics upon the strategic
goal as well as employee engagement practices of Virgin group.
Impact of leadership development on the strategic HRM goal of Virgin group
Leadership is the activity of influencing the people. The today's competitive scenario
demands for highly committed and motivated leader who plays very critical role in the task of
attaining the tactical goal of company (Fengyu and Yizhong, 2006). The success of any company
completely depends upon its leader or the type of leadership style which it uses. A manager will
be considered as effective in managing its employees, if it manages people as per the situation.
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In this regard, the contingency theory of leadership identified. This theory states that the
leader must change its leadership style as per the situation. Edward Fiedler has assessed three
basic types of leadership styles such as autocratic, participative and free rein. These all ways of
managing people have their own pros and cons. For instances, the leader who adopt autocratic
management practices will be proved as effective in circumstances when they have to make
some quick decisions (Guru-Gharana and et.al., 2008). But, such leader imposes direct impact
upon the motivational level of employees. In similar way, employees feel highly satisfied and
committed when they work under the direction of participative leader. Nevertheless, the
ineffectiveness of given style occur when manager have to make some quick decisions. Among
both, free rein is completely different form of managing workers. This leader sets the goal and
after that it sat aside and it allows its group members to make all decision for the achievement of
same on their own. The effectiveness of given style occur when the firm have group of talented
and skilled workers.
It is essential for the firm that has its presence in the number of business, that it should
make efforts with regard to enhance or maintain the motivation of its workers. This is because, if
it is not done then in the given circumstances it will become difficult for the corporation like
Virgin group with regard to achieve success in all its established business in an effectual way
(Singer and et.al., 2007). In this context, from the analysis, it is assessed that Virgin group has
number of strategic goals and among all its major SHRM objectives; the core is to make people
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Illustration 1: Fiedler's contingency model
(Source: Fiedler's contingency model, 2016)

engaged with their work. In this regard, Gupta (2010) has stated that employee engagement is the
practice in which people feel highly engaged or committed with their assigned roles and
responsibilities. However, Simons (2011) has depicted that engaged employee is the type of
individuals who feels highly passionate and perform its duty with utmost efficiency and
perfection.
In this regard, it can be said that the type of leadership style as being adopted by the
Richard Branson of Virgin Group causes necessary impact upon SHRM goal of enterprise. Here,
from the analysis it is assessed that the Richard follows democratic type of leadership style
(Richard Branson's Three Most Important Leadership Principles, 2016). The leader of cited firm
relies with three basic principles which make him to look like a democratic leader. The principles
are depicted in below:
 The leader must listen and actively respond to the problem which is being communicated
by its workers.
 Learning is being regarded as one of the most important aspect for the successful
manager.
 Laughter is the best medicine which brought stability in the stressful working
environment of firm and thus enables manager to make an effective decision.
Thus, it is being regarded as one of the most effective leadership HR practice which
leader of Virgin Group is following with an aim to make their employees engaged at work. In
this context, it is analyzed that employees feel highly engaged when they knew that they have
some importance within firm (Cartwright, 2005). Hence, in order to make the employee feel
important, the democratic type of leadership style which is being used by cited firm manager
plays very crucial role. This is because, being a democratic leader, Richard Branson does not feel
hesitate in taking suggestions and opinions from its employees. Moreover, human resource
practice which firm is following is also reflects the form of leadership approach being used by it.
Here, firm has the policy wherein employee can freely enter into the room of their senior
manager or executive with any kind of doubts or issues. In addition to this, workers have a right
to raise their voice against the stances which they feel as ineffective. All these things lead to
entail positivity among the employees and thereby it inbuilt the feeling that workers are being
valued by the manager of organization (Perkins and Shortland, 2006). Thus, it is through the
same that made Richard Branson in meeting its Strategic HRM goal which is to make employees
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engaged within the firm. This depict that HR practices followed by Virgin group is positively
impacting its SHRM objective.
However, it has been critically evaluated that the employees feel less passionate about
their job, if they see their lack of development within corporation. The workers would like to get
associated with that company only in which it will see its personal and professional growth. But,
if it will not found this at that time, it will move on to some another job or firm (Dhar, 2008).
This is because, each employees set their some career target and thus wants to meet the same
within the given specified time limit. For example, if workers have found out that the firm where
it is currently working does not have possibility of attaining the specific target at that time then
their motivational and commitment level will be impacted in a negative way. As a result of it,
they will not give their best performance to the corporation where it is working.
But, the given thing is being effectively considered by the manager of Virgin group.
Here, it is analyzed that the firm organizes leadership development programs for its employees
who comes under its HR policy (Virgin Atlantic’s HR in Practice: high-flying management,
2016). The manager of firm arranges workshop for its workers wherein it enhances necessary
leadership skills. Additionally, the programs which enterprise operates have eleven systematic
steps, each phase helps in developing the varied skills of managing people among an individual.
The program which firm runs has helped in enhancing the motivation and satisfaction level of
the workers in an effectual way. Furthermore, it is by complying with the given type of activity
only leader of cited company has met its firm goal of achieving success in all sectors through
gaining employees commitment.
Further, with this as per the view point of Deb (2006) that the corporation's priority of
engaging employees at work would become lesser, if leader adopts autocratic leadership
approach. It is due to the fact that this leader carries out strict control upon its employees.
Moreover, autocratic leader treat its employees like tool whose importance gets diminishes after
when the objective of firm will meet (Lepak and et.al., 2006). Such behavior of firm’s leader
leads to entail negative feeling among employees. As a result of it, they feel highly de-motivated
and dissatisfied. Due to this, the SHRM goal of Virgin which is of engaging employees at work
will not be met. Furthermore, because of this, the sales and profitability condition of company
will also be impacted in a negative way. Schuler and Jackson (2005) have argued that even
though autocratic leadership fails in many circumstances but it is proved as appropriate when
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manager indulge in such situation where it will have to make some quick decision. For example,
one of the ventures of Virgin group is incurring continuous losses and if necessary action
towards the same will not being taken by it at that time whole operation of enterprise will be
impacted. Therefore, in this condition, it is beneficial for Richard Branson that it must use
autocratic leadership style in the place of democratic one (Christopher and et.al., 2003). Overall,
it can be depicted that leadership HR practices which cited firm is using have impact upon Virgin
group SHRM goal.
Impact of reward management on Virgin Group SHRM goal
Reward management is the practice of formulating and implementing the reward policies
in such a manner so that each employee will feel like that they are being fairly and equitably
rewarded by their employers. In this context, it can be said that there is an interconnection is
being found out between both types of reward tactics that are used by the firm and extent to
which workers feels motivated. It has been evident from the different motivational theories that
the firm should frame its reward policy on the basis of needs of its employees. In this context,
Maslow need hierarchy theory of motivation is analyzed (Tuan, 2013). This theory has divided
the needs of employees in five different levels. The needs consist of psychological, safety,
security, self esteem and self actualization etc. The motivation of employees is enhanced when
manager of firm makes measures in terms of meeting its unsatisfied need. Hence, it is essential
for the manager that it should frame its reward policy as per needs of the workers.
In this regard, it is analyzed that the Virgin group uses both intrinsic and extrinsic form of
reward with an aim to engage its employees at work. However, effectiveness of the given form
of reward will be occurring when they are being used by the firm upon the right person. Thus,
with an aim to perform the same, manager of Virgin Group has carried out the segmentation of
its employees. For example, here firm offers intrinsic reward to the employees who reside at top
level. Here, intrinsic reward is the type of reward which is intangible but plays very effective role
in enhancing the motivation level of respective Virgin Group workers. In accordance with the
given context, different type of intrinsic rewards have been identified which consists of giving
letter of recognition, promotion and giving high roles and responsibilities to the employees etc
(Adhikari, 2010).
The top level employees are the individuals who get associated with the firm for the long
period of time. However, they feel highly engaged and committed with their work, if they get
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constant appreciation for the same. Hence, it is being effectively considered by Richard Branson
who is the owner of Virgin Group. Furthermore, the human resource policy as being framed by
Virgin Group which is a clear evidence of same (Gloet, 2006). In this context, it is assessed that
the Virgin Group has an effective intrinsic reward policy wherein it appraises the performance of
its employers by giving them different type of reward. Therefore, it is through this type of
activity only cited firm met its SHRM goal.
In addition to this, it has also being assessed that employees feel motivated when they are
being recognized from their supervisor with regard to work which they have done. However, it
has been critically evaluated by the Singer and et.al., (2007) that it is not necessary that for all
top level employees intrinsic reward is the only motivational factor which engages them into
their job or assigned work. This is because, some top level management individual have high
need of money, thus they feel motivated and engaged when some financial reward is being
offered by the firm. The manager of Virgin Group has resolved the given issue in an effectual
way. In this regard, it has distributed the company shares to the employees which have
performed well during the year. By complying with the given type of practices only, cited
corporation is achieving its employee engagement tactical HR goal with the help of its reward
management HR policies.
Furthermore, the Virgin Group uses extrinsic reward for the purpose to raise the
commitment level of lower level employees. In this regard, according to the view point of
Schuler and Jackson (2005) with respect to Maslow need hierarchy theory, lower level workers
reside at bottom level in which they have social and psychological needs. These employees
generally have low salary structure and thus they feel highly motivated when some financial
reward is being received by them in return of delivering performance to the corporation. Hence,
for these employees Virgin Group have extrinsic reward management HR policy.
Extrinsic is the type of reward which is tangible and can be used by workers with an aim
to fulfill its personal goal. This includes bonus, increment in salary and incentives etc. The given
method plays very significant role in increasing the engagement level of workers towards the
assigned job or responsibilities (Guru-Gharana and et.al., 2008). Overall, it can be depicted that
both form of Virgin Group reward management policy is imposing positive impact upon the HR
tactical goal. It is assisting corporation with respect to gain success in the competitive business
environment in an effectual way.
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Furthermore, the reward HR policy of firm should be changes as per the culture of nation
where firm is operating its operation. It is due to this fact that each employee has different views
regarding the ways of receiving reward from the firm. It has largely influenced through the
nation culture. For example, Indian people feel highly motivated when they get appropriation
and recognition in front of large group of workers. So, in order to gain the SHRM goal, it is
necessary for the manager of Virgin Group that it must consider the given aspect while giving
reward to the employees (Tuan, 2013). But, if not considered then the strategic human resource
management goal, as being framed by the enterprise will not be met. Due to this, the profitability
related condition of corporation will also be impacted in a negative way.
CONCLUSION
From the above report, it can be concluded that now-a-days, each and every firm are
concentrating their efforts with respect to enhance the commitment level of its employees
towards the job. Thereby, in order to perform the same they are performing significant variations
in their existing HR policies and practices. The given activity is helping firm with regard to gain
success in the competitive business environment. Thereby, corporation such as Virgin Group is
raising its probability of gaining the high profits and sales in an effectual way.
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REFERENCES
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751.
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Dhar, R. L., 2008. Strategic Human Resource Management. Excel Books India.
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for Hardware and Software. Asian Journal on Quality. 7(1). pp.90–97.
Gloet, M., 2006. Knowledge management and the links to HRM: Developing leadership and
management capabilities to support sustainability. Management Research News. 29(7). pp.
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Management in the U.S.: The growth in importance of the international perspective.
Management Revue. 16. pp. 11–35.
Simons, R., 2011. Human Resource Management: Issues, Challenges and Opportunities.
Singer, P. B. and eet.al., 2007. Corporate real estate and competitive strategy. Journal of
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Tuan, L. T., 2013. The role of CSR in clinical governance and its influence on knowledge
sharing. Clinical Governance: An International Journal. 18(2). pp. 90–113.
Online
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