Human resource management - Essay Example

? PART II Human resource management Human resource management assists the organization in achieving its objectives through its functions that providea secure, supportive, inspiring environment in the form of policies, procedures and practices. Some of these include effective performance management, reward systems, employment law etc. The following sections explore some of these practices and their application in different organizations. Of the many motivational theories, Vroom’s expectancy theory of motivation stands out as it links employee behavior and the outcomes as well as employee’s concept attached to the outcomes. According to this theory, employees tend to perform an action based on the value they place on the outcomes of that particular action/effort and their belief that their action/effort will produce the desired outcome. In short, employee’s effort (F) towards an action is the valence (V), i.e., value attached to the outcome multiplied by the probability/expectancy (E) attached to their action that will lead to the desired outcome (Koontz, 2010). Considering this theory in McDonald’s context provides some very interesting findings. For instance, McDonald’s motivation and recognition schemes include bonuses for high performers, recognition as employer, team and manager of the term, champion awards, promotions etc (Lovewell, 2013). Considering that the motivation factors are varied among employees, most of the factors fall into either monetary, or non-monetary categories; and, McDonald’s attempts to provide opportunities for earning both types of rewards, thereby considering both extrinsic and intrinsic motivating factors. Employees that depend on intrinsic motivation look for recognition of their efforts and will thus strive to achieve the same by putting in more efforts; conversely, extrinsically motivated staff is satisfied by the bonuses and other compensations such as company-sponsored dinner outings. Job evaluation is the process of systematic and relative comparison of roles to assess their net worth in order to derive a rational pay structure. Job analysis is the precursor for job evaluation and involves the decisions of many people that may be analytical and also subjective (Cole, 2002). For instance, Tesco has adopted a simple, clear and transparent job evaluation system that is based on subjective evaluation and divides its roles into six bands of work-levels. Work and responsibilities are also divided proportionately, with the lowest level being level-1 and highest at level-6 (Level pegging, 2009). Their pay bands are relative to the market standards for the same levels in other companies. This banding has resulted in flat organizational structure, thus reducing bureaucratic levels that were slowing down decision-making and implementing activities as well as increasing costs for the company. Other factors include providing competitive pay packages for their employees compared to competitors in order to motivate and retain their experienced staff; providing greater flexibility to its managers to identify critical leadership talent and to promote internal candidates for higher roles; thirdly, to improve teamwork and thus productivity; facilitating job rotation and lateral movements of staff members etc. Rewards are meant to motivate employees at all levels, and companies design complex reward systems that include a variety of rewards. For example, monetary rewards such as bonuses, incentives, compensation benefits, and non-monetary rewards such as recognition, promotions, appreciation, additional responsibilities, special training and skill development programs are a few reward systems that contemporary organizations use. As Lovewell (2013) points out, McDonald’s uses service awards to recognize employees’ commitment and loyalty; it rewards high performance with rewards such as restaurant of the quarter, month, and year. To recognize their support staffs’ outstanding contribution, they give the President’s award. To appreciate individual performance, they have the Champions award in addition to bonuses and incentives for employees and managers. Performance management has an impact on various employee management and developmental activities besides managing performance of employees. For instance, Tesco uses the balanced scorecard method through Steering Wheel model to assess and manage its overall performance, which assesses and evaluates performance in its five critical segments namely, community, operations, people, finance and customer, through key performance indicators assigned to each of these segments (Performance 2008-2013, n.d). The Steering Wheel imbibes all strategies that can improve their performance by engaging employees, providing learning and growth, considering customer needs and abiding by regulatory and environmental norms. For employees’ performance evaluation, Tesco uses the 360-degree approach which facilitates feedback from various perspectives that will help every employee understand their strengths and areas of improvement (Tesco Brief, n.d). However, 360-degree feedback system comes with some limitations. This system will be meaningful when the performance is evaluated based on pre-determined objectives, or key performance indicators that all people involved in providing the feedback can relate to. Therefore, the process of assessing an employee’s performance must be limited to his immediate managers and colleagues so that they had experienced the contexts relating to the feedback. Self-ratings must be avoided in order to avoid biased assessment. Assessment based on key-performance indicators will be better than the 360-degree feedback; the latter can however be extremely useful in the personality development of the individual being evaluated. On the contrary, the strength and effectiveness of McDonald’s performance management system, in the form of performance development system (PDS) can be seen in its business growth and success in various parts of the world. The PDS works on management by objectives (MBO) concept wherein individual objectives are aligned to business strategies and performance appraisals are conducted as per the results achieved against individual objectives in two terms, mid-year and annual. This approach is highly objective and goal-oriented, which minimizes potential for errors and biasness. Cessation of employment can happen because of voluntary and involuntary reasons. Employees may decide to resign from their job roles because of a better opportunity outside of the organization, retirement, or for other personal reasons. Involuntary termination may happen because of poor performance, breach of employment policy or unethical conduct displayed by the employee (Armstrong, 2007). Voluntary cessation of employment usually causes loss to the organization as it means loss of valuable experienced employees to the competitors or any other organization, whereas, involuntary termination sets an example to other employees for non-adherence to employment terms, which can be harmful for the organization. Potential harm from involuntarily-terminated employees could include reputational loss, financial loss, and lower performance, employee morale and commitment of other employees. Employee exit procedures are designed in a manner to optimize employees’ experiences and contribution to the organization and to minimize the losses from employee exit. However, involuntary exit procedures in cases of breach are usually with immediate effect unless the reasons are due to lay-off or non-performance; in the latter cases, employees are usually given sufficient notice and also pay for certain term. In case of voluntary exit, as understood from one of the Tesco’s manager, the employee first submits his/her resignation in written format to his/her immediate supervisor specifying reasons for this decision. The supervisor tries to retain the employee by conducting a discussion and providing practical assurances and/or clearing any misunderstanding in case the reasons for exit involve any conflicts. If the employee remains firm on his/her resignation, then the supervisor accepts the resignation and the employee will have to serve the notice period of one month before the employment cessation is confirmed. Upon completion of this notice period, all accesses and benefits related to employment are confirmed as cancelled. Evidences show that at McDonald’s, turnover of younger staff is much higher than the older staff; their exit interviews are certainly not as effective, which can be used to retain employees (Cascio & Boudreau, 2010). Employment cessation is governed by labour laws. For instance, both McDonald’s and Tesco abide by the employment regulations concerning equal employment opportunity, anti-discrimination etc. Both the companies have strict guidelines outlined for expected codes of conduct and breach of any of these codes would attract termination of employment from the employer’s side with immediate effect or with short notice depending upon the severity of issue. In case the company decides to make few positions redundant, then they are legally obliged to provide sufficient notice to the employee along with pay; however, misconduct or unethical behavior would attract immediate termination without any pay or notice. All employees are eligible for retirement benefits depending upon the retirement age decided in state regulations. The usual retirement age ranges from 58-65. Employees also enjoy rights against unfair dismissal if the employer fails to produce sufficient evidence towards termination. Dismissals due to redundancies need sufficient and objective evidence from the employer failing which the employees can fight for their rights (Kelly et al., 2013). In conclusion, the above discussed HR activities related to motivation, performance management, reward systems, and employment regulations add value to both employees and the organization as these help in retaining the critical human resources and assist them in learning, performing and growing. Different organizations adopt different approaches to implement these practices based on the nature of their business and governing national regulations. Overall, these practices help in optimizing employment experience to both employers and employees as well as outcomes of employee efforts. References Armstrong, M. 2007. A handbook of human resource management practice. London: Kogan Page. (pp: 225-238) Cascio, W and Boudreau, JW. 2010. The high cost of employee separations. In Investing in people: Financial impact of human resource initiatives. New Jersey: FT Press. pp: 79-115. Cole, G.A. 2002. Personnel and human resource management. London: Thomson Learning. (pp: 162-172). Kelly, D, Hayward, R, Hammer, R and Hendy, J. 2013. Individual employment rights: Termination. In Business law. Oxon: Routledge. pp: 503-538 Koontz, H and Weihrich, H. 2010. Essentials of management: An international perspective. NewDelhi: McGrawHill. (pp: 290-314). Level pegging. 2009. PM Editorial. Available from http://www.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2013/01/29/level-pegging-2009-01.aspx (Accessed 22 November 2013). Lovewell, D. 2013. McDonald’s restaurants built on motivation. Employee benefits. Available from http://www.employeebenefits.co.uk/benefits/staff-motivation/mcdonalds-restaurants-built-on-motivation/102953.article (Accessed 22 November 2013) Performance 2008-2013. N.d. Tesco and society. Tesco Plc. Available from, http://www.tescoplc.com/index.asp?pageid=87 (Accessed 22 November 2013). Tesco Brief. N.d. How training and development supports business growth: A Tesco case study. www.thetimes100.co.uk. Available from http://businesscasestudies.co.uk/tesco/how-training-and-development-supports-business-growth/development.html#axzz2lNILbfPL (Accessed 22 November 2013). Read More