Improvement of the Companys Operations - Literature review Example

?In order to determine what particular steps can be taken towards the improvement of the company’s operations it is necessary to analyze the existingproblems. The most important of them are: absence of a dedicated HR section – there is no formalized people management function; reward levels are below of those provided by some other local employers; high turnover rates; autocratic management style ; ineffective communication and communication mechanisms; absence of training programme for employees and their supervisors. Whatever should be done for solving these problems, the strategy, as well as its practical application, should be well-planned, effective and efficient. This task is the responsibility of the HR function. Since a senior Personnel Manager is to be supported by a team of staff, it is important to ensure that these people are knowledgeable about HR practices related to resourcing, training and reward systems, in the first place. Therefore, even though hiring such people might be more expensive for the company, the business will win in the long run since a team of professionals in their function is more likely to help in avoiding compensation payments following tribunal decisions than promoted and untrained people from within the company. As the working team is created it is the time to start the design of a strategic business development plan, which would address such issues as resourcing, training and rewarding employees. However, all these functions should be incorporated into a larger-scale plan for developing and maintaining such aspects of business behaviour as leadership, performance management and organizational culture, among others. The most immediate issues to solve are related to employees’ resourcing, training and reward systems. Resourcing System Armstrong (2000) outlines that among the major objectives of employee resourcing strategy are finding and hiring employees with the needed skills, knowledge and training potential. These initial requirements to the choice of potential employees are, then, to become the basis for further development and motivation of the staff. However, since most of the company’s employees are unskilled, part- time or agency workers, it is worth to pay more attention to the attitudinal and behavioural characteristics of the potential employees (Townley, 1989). The employees should not view the company as a temporary place to work at. On the contrary, the organization should be perceived as a stable and developing company that provides a good long-term employment opportunity. To become such, the company has to modify its resourcing system. In the first place it is suggested to minimize the number of part-time and agency workers and use their services on an as needed basis. Though employing part-time employees provides higher levels of scheduling flexibility and reduces the wage and benefit costs (Conway and Briner, 2002), using their service should be limited to the busiest periods of business operations. This suggestion can be justified by the fact that, according the research conducted by Conway and Briner (2002), part-time employees have lower commitment, trust and loyalty levels in comparison to those of full-time employees. Therefore, employing people on a full-time basis will help, in the long run, to shape such, directly related to performance, aspects of employees’ behaviour as job satisfaction, organizational citizenship behaviour, loyalty and, therefore, efficiency. Furthermore, full-time employment will help people to develop organizational commitment and trust and, as a result, will reduce turnover. At the same time, effectively designed training and rewards systems are the other elements of business operations that are to have a significant impact on the reduction of turnover. Another important aspect to deal with is hiring supervisors to manage the work of the production staff. Currently the production director of the company chooses and draws supervisors from the production staff with longer periods of service. However, these people are not even interviewed and have no managerial experience. Therefore, at the beginning it might be more efficient to hire experienced in managing people individuals from out of the company. Then, as the training system is developed and implemented, such individuals may even train and coach new supervisors chosen from the production staff on the basis of specific behavioural characteristics, such as emotional intelligence, knowledge acquisition skills, organizational commitment and basic leadership skills. Training System Training system should be a part of a larger performance management system that can be defined as a set of activities, the goal of which is to ensure that the organization is working effectively. Managing performance is, thus, organizing, supervising and controlling effective work of each separate employee. The major elements of performance management, such as performance planning, coaching and appraisal (Bacal and Associates, 2010), help companies to clearly identify goals, to build processes that will help to reach those goals and, finally, encourage employees for further achievements and positive behavior. In the particular case of Welltasty it is worth to provide some basic training for current supervisors, as it was mentioned above. In addition, since the number of staff and, consequently, supervisors, is to increase, it is worth, as mentioned above, to hire experienced managing professionals. This will, in the first place, provide the organization with more knowledge exchange opportunities. Secondly, before the training program is fully developed, new experienced supervisors will provide an opportunity to implement such training techniques as performance feedback and coaching for both the production staff and the untrained supervisors. Performance feedback is the process that involves communication between manager and employee on the topic of employee’s performance. The parties exchange information on the expected and actual performance (Indiana University Human Resource Services, 2006). The goal of the performance feedback process is to encourage and reinforce good performance, as well as to correct and improve poor one. A constructive feedback from a manager helps an employee to get a clearer idea of the company’s expectations, to receive help, direction and advise, as well as understand whether his or her performance is sufficient. In addition, performance feedback encourages employees to deliver better results and, thus, motivates. Better self-analysis leads to self-improvement and, as a result, increases productivity and job satisfaction. Organization, as a result, improves own performance, grows and develops through the improved performance of separate employees. Another training method that will help to introduce some basic training at Welltasty is manager’s coaching. A coaching manager is a manager who not only oversees and controls the work of one’s subordinates, but also helps them to develop and grow professionally. Such a manager develops the talents of the subordinates by helping them, directing and giving constructive advice (Behavioral Coaching Institute). Successful coaching managers teach the members of their teams or departments to continuously improve and develop their potentials. As a result, a coaching manager brings up a team, each member of which does his best for delivering the needed results. A coaching dialog is communication between a manager and an employee. It should take place regularly so that an employee gets feedback and coaching needed for finding solutions at each particular period of time. Coaching is important for performance management because, being a part of this process, it helps to improve individual and, as a result, organizational performance. Feedback and coaching are what will help the company in the short run. With time, however, it is needed to introduce a formalized and written training system for continuous training and evaluation of production workforce, production supervisors, and managers with their supporting staff. Reward System Remuneration, or reward, for the performed work is expressed in monetary, non-monetary and psychological payments of a company to its employees. Such rewards may be extrinsic, expressed in monetary compensation, job security and recognition, and intrinsic, such as job satisfaction or social interactions in the workplace. The goal of them all is to attract good employees to join the company, to improve or maintain good performance and to maintain commitment. Furthermore, the remuneration system should be standardized, adequate and fair. However, as The Financial Express (2005) outlines, fixed salary, though was once a popular approach, shows to be a less effective reward these days. It does not motivate employees well enough. Therefore, it is suggested that the new remuneration system should be performance-based. A performance-based incentive is a variable part of the salary, which is based on individual, group or organizational performance. One of the major advantaged of a performance-based pay system is that it recognizes and rewards individual efforts and motivates for effective future performance. In addition, it reflects the level of the job’s complicity and number of manager’s responsibilities (Mishra et al., n.d.). Though there exists a number of performance related incentive types, the most appropriate to be considered in this particular case are the following: Payment by result – based on the achievements of an individual or group within a specified time frame. Merit incentives – based on the “general assessment of an employee’s contribution to performance” (Mishra et al, n.d., p.11). Objectives related incentives – based on the employee’s or group’s success and progress in achieving the previously set goals. Competence based incentive – a reward for achievements in specific areas, such as decision making, leadership, etc. This type of incentive, however, should be used mostly as a motivational tool, and might not make a percentage of the overall bonus, but act as once-off award for special achievements. In our case performance-based remuneration should be based on either individual or group performance. Individual effort should be recognized and rewarded in case it is the key to achieving corporate goals. However, when reaching the set goals involves close cooperation of employees and team work, the group effort should be recognized and rewarded as well (Gomez-Mejia and Welbourne, 1988). As an option, it is possible to establish a policy that will be distinguishing and rewarding both individual and group contributions. However, in order to implement the described above system the company has to determine a bonus potential (Mullen, 1994). It means that if, for example, a bonus potential is set at 25% and a manager (or a manager with one’s team) successfully accomplishes all the assigned tasks, reaches all the set goals, and meets organizational objectives, then he or she will get a salary plus 25% of the salary in the specified time frame (Festing et al, 2006). The next goal would be to develop a system of non-financial rewards that include recognition, praise, empowerment, improved working conditions, etc. Other policies and concepts Since currently the company has no developed written policies, it is necessary to design and introduce a number of additional changes that will organize structure and improve business operations. Therefore, the short-term plan should include the process of determining the overall business development goals expressed in mission and vision statements of the organization. It is also necessary to conduct a SWOT analysis of the business in order to determine potential opportunities for growth and possible risks to be mitigated or eliminated. The mission and vision statement will help to clarify the overall direction of the company’s development and will greatly contribute to the formation and reinforcement of corporate culture. They will also help to set goals and identify how in particular the company is going to achieve those goals. As the above mentioned components of organizational behaviour are identified, it is necessary to design a change management system that would help to introduce the changes needed for improving organizational performance. Then the company should introduce efficient communication system and channels, because otherwise the attempts to introduce changes and innovations will not be successful. Effective and organized communication can assure that the company’s plans, goals and policies are understood and accepted by the employees. Furthermore, such effective communication should be two-way: not only management should inform employees on its decision, but should also listen and receive feedback from the employees. For this purpose it makes sense to create a works council style consultation group, as the employees requested. This will not only increase employees satisfaction, but will also help to improve communication between management and employees. Furthermore, improved communication may lead to a faster change of leadership style from autocratic to democratic, which shows to be more effective these days. Autocratic leadership involves directing, controlling and manipulating the followers, and this management style leads to lowered commitment among employees (Bennis et al, 2001). So, modifying the management style through the introduction of improved communication, rewarding and empowerment will improve employee’s morale and task performance. References Armstrong, M. 2000. Strategic Human Resource Management. Kogan Page Publishers. Bacal & Associates, 2010. What Are The Components of A Performance Management System? [online] Performance Management & Appraisal Help Center. Available at: [Accessed 2 March 2013]. Behavioral Coaching Institute. Management Coaching: Turning your managers and leaders into coaches to coach themselves and their staff. [online] Available at: [Accessed 2 March 2013]. Bennis, W., Cummings, G. and Speitzer, M., 2001. The Future of Leadership. Jossey-Bass. Conway, N. and Briner, R., 2002. Full-Time versus Part-Time Employees: Understanding the Links between Work Status, the Psychological Contract, and Attitudes. Journal of Vocational Behavior, 61, pp.279–301. Festing, M., Eidems, J., Royer, S. and Kullak, F., 2006. When in Rome Pay as the Romans Pay? – Considerations about Transnational Compensation Strategies for Executives. Paper presented at the IFSAM-Conference, Berlin, Germany. Gomez-Mejia, L. and Welbourne, T., 1988. Compensation Strategy: An Overview and Future Steps. Human Resource Planning, 11(3), pp.173-189. Indiana University Human Resource Services, 2006. Performance Feedback. [online] Available at: [Accessed 2 March 2013]. Mishra, A, Ahmedabad, I. and Mishra, S. Feasibility Study of PRI and MoD. Report submitted to the Sixth Central Pay Commission. Mullen, J., 1994. Variable pay: linking salary to performance. [online] AllBusiness. Available at: [Accessed 2 March 2013]. The Financial Express, 2005. Fixed vs variable pay: the right ratio. [online] Available at: [Accessed 2 March 2013]. Townley, B., 1989. Selection and Appraisal: Reconstituting 'Social Eelations'? In: J.Storey (ed.) New Perspectives on Human Resource Management. Routledge: London. Read More