Human Resource Strategies of South African Breweries - Essay Example

Human Resource Strategies of South African Breweries The term HR strategies refers to the specific human resources management courses of action the company pursues to achieve its aims 1 The overriding aim of HR strategy is to build a committed work force, preferably in a nonunion environment. 2 Thus one of South African Breweries strategic aims is to be the best world brewery in the 2000. To achieve this objective the company had to restructure its jobs by enhancing staff cuts Every company must design a soft of HR polices and practice that makes sense for its own strategy and situation. The employee-testing program that works for hiring will not be same in all companies. Research shows that HR systems of high performance working companies do have many things in common and that they differ in measurable ways from those of low performing companies. Specifically, these HR systems are ‘high performance work systems’ (HPWS). High performance work systems generate more job applicants, screen candidates more effectively, and provide a safer working environment. In terms of measurable outcomes high performance working produce more qualified applicants per position, more employees hired, based on validated selection tests, more hours of training for new employees and a higher percentage of employees receiving _____________ 1. S. Wilkins “Hire and Higher P.C week, July 8, 1996, PP 45-47 2. M. Mink “Software eases HR tasks” credit union executive no. 6 (November - December 1996). regular performance appraisals. The general aim of high performance working is to maximize the competencies and abilities of employees throughout the organization. High performance working is aligned to the best practice of strategic human resource management in the sense that high performance working is a set of HR policies, strategies and practices that maximize the competences, commitment and the ability of the firm’s employees. This means that high performance working; HR activity produces measurable superior results. In reference to South African Breweries Limited all the practices carried out by the company aim at high performance. For instance “value-sharing workshops” involving 6,000 employees held by Mac Group a U.S consultancy company, the training investment the company has embarked on intended to up skill all terms members and take autonomous multi skilled working practices, restructuring of jobs and cuts in staffing levels, effective communication, performance appraisals, career development, succession planning, corporate social responsibility. The whole thrust of high performance working’s superior recruitment, training, appraisal, screening and other practices is to build the sort of highly trained, empowered, self governing, and flexible working force that companies today need as a competitive advantage. 3 Therefore high performance working align itself with strategic human resource management in ensuring that the company’s goals and objectives through human resource strategies, policies and practices. Strategically HR department is engaged in managing change by:- _____________________ 3. M. Mink “Software eases HR tasks” credit union executive no. 6 (November - December 1996). · Building a working environment that is conducive to change: this means developing the firm as learning organization. · By allowing those affected by the change to participate fully in planning and implementing it. This is done in order to get them to ‘own’ the change as something they want and will be glad to live with. · By creating strong committed and visionary leadership from the top. · Psychologically prepared the employees to be ready for change. This is done by conducting regular training. · Putting emphasis on changing behavior, not on corporate values. 2) First, organizational development (OD) is a planned systematic process in which applied behavioral science principles and practices are introduced into an organization towards the goals effecting organizational improvement, greater organizational competence and greater organizational effectiveness 4. This system includes the techniques and methods the managers can use to change the behavior of staff. From organizational development perspective South African Breweries (SAB) has succeeded in integrating organizational development strategy. This is evidenced by the fact that the company invited Mac Group, a U.S. consultancy to review its strategic process. The consultancy customized version of Mac Lagan International’s “Integrated Management Process” (IMP) to set the ball rolling. __________________________ 4. French W.L and Bell C.H (1990) organization development. Englewood Cliffs, N.J, Prentice hall. This plan was geared towards a value sharing workshops which involved 6000 employees. This workshop was to impact new skills to the workers on how to tackle their tasks. Multi - skilling working practices embraced by the South African Breweries was also another organizational development strategy. This practice was set up to up skill team members on how to handle various tasks through training the employees will gain the right skills and work in different ways. Further to gain a more competitive advantage globally, down sizing or streamlining as well re-structuring of job is an essential organizational development practice. This practice is made to ensure that the less productive workers or employees are allowed to retire voluntary by giving them their benefits and support. For instance South African Breweries did in laying off part of its staff. This allows the company or organization to restructure its jobs so as to increase productivity. Communication process is an essential tool in an organization. Proper communication inspires high performance. The emphasis communication laid in the case material of SAB clearly integrates organizational development strategy in the organization. Further appraisal of both employees and customer satisfaction is also important in organization. This shows the direction in which the organization is headed to. For instance customer satisfaction in any organization is the major priority. Promotion and development of staff and its corporate social responsibility is also an evident of proper organizational development strategy of South African Breweries. Therefore as part of organizational development strategy of South African Breweries it has achieved success in terms of:- (i) Training its staff. (ii) Promoting, rewarding and motivating its staff. (iii) Restructuring and downsizing of staff. (iv) Carrying out performance appraisal on employees and customer satisfaction. (v) Embracing change. (vi) Promoting teamwork and multitasking of employees. In this regard organizational development has been integrated in South African Breweries. The practice has been successful gaining the company a competitive advantage to be a low cast leader globally. Its strategic framework has been successfully managed as a planned programme of change. This can be witnessed on evidenced from the fact that long before change was enacted, employees were made aware of the change process. They were trained on how to tackle their new tasks and they even allowed being part of change themselves by participating in the change process. Further, the workshop held by Mac Group consultancy prepared the employees to adopt change in the company’s growth cycle. Therefore the employees in SAB expected a change and were ready to manage that change. Also on the job training i.e. coaching and performance management were built on the team structure. Employees could learn new techniques from managers while working. South African Breweries has been able to manage a planned programme of change by identifying the areas that need training regularly as well as preparing or training prospective employees for succession planning. An employee is identified in advance and subjected to learning on how to handle his new task from the out-going employee. This prepares him/her to handle his new roles successfully once he takes charge. In addition South African Breweries Strategic Framework has been managed as a planned programme of change through the following:- (a) Investing on training (b) Restructuring of Jobs. (c) Improving or putting emphasis on bottom up communication as well as top down. (d) Restructuring of HR. (e) Introduction of a more formalized competency acquisition system. (f) Development of staff. All the above HR practices were put in place in SAB so as to prepare the employees for change. This made it easier for them to accept the change process because they were part of the proposed change. Through this there was no resistance from employees in accepting or embracing the change. They fully managed it as a planned programme. Conclusively, SAB has been successful in managing a planned programme of change by being able to integrate everybody in its change process and by training its employees in readiness for change before it was enacted. This has enabled it to gain a competitive advantage globally by becoming one of the best organizations globally No. 3 Reference to South Africa breweries, Human resource department has fully embraced strategic human resource thinking and adopted a relevant range of policies. Human Resource management is a strategic and correct approach to management of an organization most valued assets the people working there who individually and collectively contribute to the achievement of its objectives 5 Strategic HRM is the linking of HR activities with the objectives or goals of the company so as to improve business performance and develop organizational culture that foster innovation and flexibility 6 Therefore once these HR activities have been linked with the objectives and goals of the company then a strategy is formed. A strategy is the determination of the basic long term goals and objectives of an organization and the allocation of resources necessary for carrying out these goals.7 A strategy is the direction and scope of an organization over the longer term. Ideally, this matches its resources to the changing environment and in particular, to its markets, customers and clients to meet stake holder expectations.8 Reference to South Africa Breweries Ltd., the HR department has embraced SHRM in the sense that HR activities have been linked with the objectives and goals of the company to improve business performance. This can be proved through the following HR activities adopted by SAB to improve business performance. a) Holding Value- sharing workshops: this workshop was held to earn employees, more skills on customer service, quality, and commitment to the environment, respect and equality of opportunity, health and safety and employees in improving the ___________________ 5. G. Dessler, HRM, Training and development, tenth edition, 2005 6. Institute of personnel management, HR journal, August 2006, 7. A.D. Chandler (1962) Strategy and Structure. Boston, Macs, MIT Press 8. G. Johnson and K. Scholes (1993), Exploring corporate strategy, Hemel Hempstead, Prentice hall. performance of the company so as it to be the best company in the world by the year 2000. b) Training- this was intended to earn the right skills to employees so as to work in different ways. It was also intended to take multi skilled working practices a step further. c) Competency acquisition system: Ensuring the acquisition development and retention of uniquely talented employees who can deliver performance, productivity, flexibility, innovation and high levels of personal customer service d) Restructuring Jobs: This is intended so as to become more competitive by streamlining the business and cuts in staffing levels. e) Performance Appraisals: It is intended to ascertain individual performance and organizational performance. It is done at monthly one-to-one meetings for managers and their staff in South African Breweries. f) Career Development and Succession planning: these are geared towards performance. Employees are developed career wise and a suitable candidate is identified for future succession. Section B 3) Training refers to the methods used to give new or present employees the skills they need to perform their jobs. 9 the organization feels that the managers need to learn new ideas or when they feel that training and development of management staff need not to be carried out when _______________________________ 9. G. Dessler, HRM, Training and development, tenth edition, 2005 P.270 they need to develop a particular personal professional interest. A plan must be secured, a series of briefing sessions/seminars/training sessions are conducted with key management staff, that is, those people who are crucial to the successful adaptation and acceptance of the proposed changes. These training sessions typically comprise: · Explanation of process of cultural changes (as illustrated in the flow chart above); · Emphasis on the importance of empathy, communication and participation with worker; · Explanation of key aspects of process for management, including; § Clear articulation of desired visions and associated practices; § Translation of vision into memorable reality, for example, ‘attacks the problem, not the person’ (Snyder, 1988); § Endorsement of top management and ‘modeling’ by management, resulting in, for example, ‘vicarious learning’ (Bandura, 1969) through meeting workers, ‘spreading the word’, and so on; § Building a new team, if necessary, to reinforce the new values/approach; § Engaging in symbolic acts, for example, team/company presentations, changing uniforms to symbolize team spirit, and so on; · Explanation of proposed goals and aims to be achieved through change and how these will impact on the organization and, ultimately, on organizational performance, that is, translation of a ‘soft’ process into ‘hard’ financial results; · Training management in ‘transformational’ leadership skills, and in the understanding of group · Processes and group dynamics. Training and development must be a continuous process in an organization. The management staff is always tasked with the administration or management of business in day to day out. Therefore there is need for those managers to attend various courses or training regularly. It need not be the time when management feels that they should learn new ideas. The training programmes must be well planned and designed so as to meet the needs of the management staff. 10 Training and development should be allocated a good budget which should see it run throughout the year. Further training and development is a major tool for an organization to increase its productivity. Recruitment of competent and skilled staff alone without training will not deliver the goals of an organization In this context, for effective training and development of management staff in an organization should not be carried out when there are be ideas to be learned or when developing a personal professional but rather regularly carried out. 11 In this regard training and development should start with identifying training and development needs analysis as follows:- i) Identifying training needs. ii) Plan and design training. iii) Deliver training ____________________________________ 10. G. Dessler, HRM, Training and development, ninth edition, 2002 11. W. Alfred Jnr. Et al “Effectiveness of training in organizations” journal of psychology 88, no. 2 (2003) p.242. iv). Evaluate training outcomes. (i) Identifying training needs: - A needs assessment is identifying a systematic exploration of the way things are and the way they should be 12. It is associated with organizational and individual performance. Needs assessment is a systematic analysis of the specific training activities the organization requires to achieve its objectives.13 This is so because an organization should commit its resources only to those training activities that can best help in achieving its objectives. Training needs analysis is concerned with defining the gap between what is happening and what should happen Training needs assessment is essential because it determines what training is relevant to the management staff. It also determines the type of training which will improve performance. Therefore training is essential where there are training gaps. Training gaps are those deficiencies which need to fill by training. 14 The gaps existing may be performance gap where learning is needed to achieve career, goals or opportunity gap to quality for an identified new job or role. ii) Plan and design training. After the training gaps have been identified plan and design of training should be laid down. Firstly, objectives for training system should be set. During this phase, trainers work from learning goals to _________________________ 12. 14. P.N. Blanchard and J. Thacker, Effective training: systems, strategies and practices (upper Saddle, Prentice hall (1999). 13. HR training manual, Institute of personnel management, issue no.5, 2005 p. 16 14. G. Dessler, HRM, Training and development, tenth edition, 2005 design a training system or role. Learners and trainers can implement to meet the learning goals. This phase also includes needed facilities, necessary funding course context, lessons and sequences of lessons. Here the various training media are selected e.g. instructor led, computer based or multi-media. The phase ends in a model or blue print of the training program for future development. The model or blueprint will contain five key outputs. 15 (i) Entry behaviors. (ii) Learning objectives. (iii) Learning steps. . (iv) Performance test (v) Structure and sequence program outline After identifying training needs analysis and after plan and design of the program, one must determine the training technique that will achieve the intended purpose of training. That is to choose the training method that best fits a given situation, define carefully what you wish to teach. The training to be useful must meet the minimum conditions needed for effective learning to take place. The training method should strive to improve performances, illustrate designed skills, provide timely feedbacks, and encourage positive transfer from the training to the job. The organization should consider the available training techniques. These _____________________________ 15. G. Johnson and K. Scholes (1993), Exploring corporate strategy, Hemel Hempstead, Prentice hall. techniques can be on the job training or off the job training. 16 The best method that will achieve the intended training purpose should be chosen. The training methods include off the job training courses i.e. lecturers, talks, discussions, discovery method, case study, role play simulation, group exercises, team building, distance learning, projects, guides reading, computer based training. On the job training it includes demonstration, coaching, mentoring, job rotation, planned experience. (iii) Programme delivery: This is where the real training is delivered. This entails the people who should provide training. On the job training can be provided by managers, team leaders, colleagues or mentors. Off the job training which is mostly prevalent for management staff, is provided by external education providers and training establishments or training providers like peak performance international. iv) Evaluating training: Finally training programmes are evaluated to assess their effectiveness in productivity, the learning outcomes specified in the objectives and to indicate where improvements or changes are required. Evaluation training is done to find out how trainees reacted to the programme. Secondly, to find out what principles, facts and techniques were understood or absorbed by the conferees. This is measured in terms of knowledge and skill gained. It brings out behavior of an individual which is measured in terms of training and on-the-job behavior. Finally is to evaluate the results of the training. That is what the employees achieved. from the training how it benefited them as well as the organization _________________________________ 16. P.N. Blanchard and J. Thacker, Effective training: systems, strategies and practices (upper Saddle, Prentice hall (1999). Strategic integration of HRD at the heart of organization development objectives is necessary. Firstly, Human resources development is developing an employee career wise. 17 Therefore strategic integration of HRD can be carried out by the organization spelling out its development objectives to its employees. An organization should priotise development of employees. To achieve this, employees must be trained and after training they should be promoted and their pay should be raised. Further on performance and experience is also a matter to consider. Not all employees in an organization can be trained due to their level of education and owing to their experience and performance to the organization they also need to be promoted. Human Resource Development therefore is not a separate activity to be handed over to a specialist and forgotten or ignored. The success of human resources development depends upon the degree to which all levels of management are committed to it. It is a prerogative of both the organization and the individual to facilitate human resources development. However, the primary responsibility rests on the organization to identify and develop its employees. The organization in its part should encourage, guide and provide opportunity. It must provide conditions favorable for faster growth. In order to achieve this, organizations should strategically integrate HRD at the heart of must be motivated, rewarded, and developed so that they put all their energies towards an organization. Therefore the success of an organization will be achieved through teamwork and commitment of personnel. Organizations should include HRD as the main objective towards achieving their organizational objectives. The goals and objectives will __________________________________________ 17. J. Salopek, “Trends: Lost in transition”, training and development, December 2003. never be realized without properly maintaining human resources by training them, motivation, rewarding, and giving them incentives. 4) Reward strategy is a declaration of intent that defines what the organization wants to do in the longer term to develop and implement reward policies, practices and process that will further the achievement of its business goals and meet the needs of its stakeholders.18 Reward strategy provides a sense of purpose and direction a frame work for developing reward policies, practices and processes. It is based on an understanding of the needs of the organization and its employee and how they can best be satisfied. It is also concerned with developing the values of the organization on how people should be rewarded and formulating guiding principles that will ensure that these values are enacted. Reward strategy is underpinned by a reward philosophy that expresses what the organization believes should be the basis upon which people are valued and rewarded philosophies are often articulated as guiding principles. Reward system of an organization can be linked to organizational change programme in the sense that a change in organizational affects the reward system in one way or another. In this regard a change in reward system should be harmonized by re-structuring reward system should be based on detailed analysis of the present arrangements for reward, which would include a statement of their strengths and weaknesses. As suggested this could take the form of gap analysis which compares what ____________________ 18. M. Armstrong, “SHRM” guide to action 3rd edition, p. 149. is believed should be happening with what is happening and indicates which gaps need to be filled. 19 If organizations want to adopt change programme they must change the way individuals behave. The reward system must ensure that this process of change can happen and that the implementations of reward systems do not work against business objectives. To be effective reward system must begin with an assessment of strategic business needs in the context of the organization’s values and culture and the kinds of behavior if wishes to provide in the future. Further there is need to establish reward system congruence. In other words the components of the reward system are not stand alone items. Once a business has established its priorities it must assess what elements of rewards should be changed and assess what elements of rewards should be changed and assess them against the business needs, the priorities for change and the realities of the external labor market. Congruence is not limited to just the elements of the system itself. Any new arrangements must fit the other features of human resource management systems; these will include manpower and skill requirements, career patterns, needs for staff mobility etc. Having decided on the priorities of change in reward system, an assessment will need to be made on the options for change, each of which will have advantages and disadvantages. Whatever options are chosen and there are a variety of tools and ___________________ 19. chartered Institute of personnel (2004) “how to develop a reward strategy” techniques for assessing such a number of critical success factors will apply:- · Any change must be seen and believed to have top level commitment. · There must be full involvement and to any implementation programme. · The change must be communicated so that both managers and other employees will play a vital part in re-enforcing the messages to be communicated and in ensuring that they are fully understood. · Each individual component of the reward management programme must fit with overall enumeration and other human resource strategies. By adopting a logical review of their reward systems needs, organizations will be able to decide on the direction for change and will be able to adapt and respond to changing economic circumstances in order to compete in an increasing competitive world. Changes in reward can be linked into broader organizational change progress in such a manner that organizational change programmes should accommodate changes in reward systems. This does not mean that once organizational programmes have changed the reward systems should be stopped. The reward systems should be changed to fit the organizational change programmes. The only way employees will fulfill the organization’s goals or dreams is through reward. Reward systems are much more than just bonus plans and stock options. While they often include both of these incentives, they can also include awards and other recognition, promotions, reassignment, non-monetary bonuses (e.g. vacations) or a simple “thank you”. 20 _______________ 20. E.C. Murphy and M. A. Murphy, “Leading on the edge off chaos”, 2003. The greatest management principle is that the things that get rewarded get done. “You get more of the behavior you reward. You don’t get what you hope for, which for or beg for. You get what you reward”.21 When your employees do hit the target and meet a stretch standard you set for them, reward there immediately. Never shall. By doing this you help employees already connect the reward with behavior and higher performance they’ve attained. 22 “Fail to reward the right behavior and you will most likely get the wrong results. 23 For example at Intel Company limited, rewards are clearly linked to performance. About half of pay is tied to company and divisional performance, and more than 70% of employees have rights to purchase stock options. The way Intel management sums this up is, “the reward system reinforces the company’s high expectations of its employees to grow, learn and lead.” 24 In conclusion a change in reward systems can be linked to organizational change programmes so as for the two to run smoothly without conflicting in either way. These changes should be done in a careful manner that they are communicated to the employees in advance for them to adjust to the changes. ____________________ 21. L. B. Michael, “How to motivate people” 22. A. Bruce, “How to motivate every employee” 2003 23. R. Denny, Motivate to win, 2002. 24. A. P. Bruce and J. V. Albert, “The center less Corporation” 1998 References. 1. S. Wilkins “Hire and Higher P.C week, July 8, 1996, PP 45-47 2. Mink “Software eases HR tasks” credit union executive no. 6 (November - December 1996). 3. French W.L and Bell C.H (1990) organization development. Englewood Cliffs, N.J. Prentice hall. 4. Institute of personnel management, HR journal, August 2006, 5. A.D. Chandler (1962) Strategy and Structure. Boston, Macs, MIT Press 6. G. Johnson and K. Scholes (1993), Exploring corporate strategy, Hemel Hempstead, Prentice hall. 7. G. Dessler, HRM, Training and development, tenth edition, 2005 P.270 8. P.N. Blanchard and J. Thacker, Effective training: systems, strategies and Practices (upper Saddle, Prentice hall (1999) 9. HR training manual, Institute of personnel management, issue no.5, 2005 p. 16 10. M. Armstrong, “SHRM” guide to action 3rd edition, p. 149. 11. chartered Institute of personnel (2004) “how to develop a reward strategy 12. Institute of personnel management, Training manual, 2006. 13. E.C. Murphy and M. A. Murphy, “Leading on the edge off chaos, 2003. 14. L. B. Michael, “How to motivate people” 15. A. Bruce, “How to motivate every employee” 2003 16. R. Denny, Motivate to win, 2002. 17. A. P. Bruce and J. V. Albert, “The center less Corporation” 1998 Read More