Human Resource Planning - Literature review Example

Human Resource Planning Case Context In contemporary business environment, organizations need to establish dynamic resource capabilities in order to address sudden changes in demand-supply equation in labour market. According to Daft (2008), conjoint impact of globalization and shifting business trend have forced companies to redefine the role of leadership to direct generic competencies as a whole. In such context, Wolsey, Abrams and Minten (2012) presented a case study to represent how companies invest on its people to develop generic leadership competencies among them which could help the organization to handle contingent situations in better manner. However, Dale Lodge (case organization) is facing challenges regarding deploying the leadership development program for cross functional members while the company is expanding its operation to achieve more business success. In such context, the researcher has been hired as external HR consultant to advise senior management of the company on how to embed leadership development program within organization, to support anticipated growth strategy. In the next section, the study will cover three issues, 1- process for embedding leadership development program for members of management team, 2- proposal of reward strategy that would retain and develop talents at all level and 3- evaluation and measurement of critical success factors associated with the proposal. Discussion The company will face two types of problem while deploying leadership development program, problem 1- lack of cross functional capabilities among members of management team and it will create problem for them to perform current and future leadership roles and problem 2- lack of experience in handling change dynamics while deploying leadership program. For example; Oracle Corporation (2012) found that more than 70% of employees in different companies across the globe lack the leadership potential to perform during job responsibility shifting. In the case context, senior management of the company has decided to expand business operation in terms of opening full scale conference and leisure facilities which can offer year long services. In order to implement mentioned growth strategy, company needs to widen job roles of existing members in management team in order to develop leadership capabilities among them. Such cross functional role shift would require development of interpersonal skills instead of developing integrating technical expertise of experienced members in management team. Caligiuri (2006) and McCall and Hollenbeck (2002) also pointed out that numerous task-related challenges and unfamiliar responsibilities make organizational members nervous which may affect their leadership capabilities. However, Caligiuri (2006) showed doubt over outcome of leadership development program and according to the scholar, 75% of such initiatives fail to produce measurable business growth. For example, during early 1990’s, leadership development program in Procter & Gamble failed miserably due to lack of leadership competence of top level management. Successive failure of leadership team of Caterpillar Inc to run the business profitably during 1980’s can be cited as another industry example for showing vulnerability of leadership development program (Neilson and Pasternack, 2005). In such context, the essay will recommend 7 step leadership development programs to senior management of company which can help them to manage the transition from technical skill deployment to development of generic leadership competencies for members in management team. Step 1- it is advisable to senior management to identify compatible leadership style for the company. Considering the situation, it can be surmised that participative leadership style would synchronize well with business agenda for outdoor activities centre. Desired leadership style would be determined on the basis of qualification of participants in the program, compatibility of participants with type of work and existing culture of the company (Oracle Corporation, 2012). Step 2- senior management should conduct psychometric test, written examination and previous performance evaluation to identify potential candidates, who have leadership competencies such as decision making skill, conceptualizing ability, adaptation ability, and cooperation ability and planning skill (Oracle Corporation, 2012). Step 3- on the basis of the test, existing gap in leadership competency for each member in management team will needed to be identified by senior management. Step 4- higher authority needs to develop succession plan for managerial level at different cross functional division of the company. According to case study presented by Wolsey, Abrams and Minten (2012), the company is reshuffling people with management capabilities as the team size is increasing and as a result, members in management team of the company are being exposed to new functional responsibilities. In such context, the company should use coaching and mentoring to develop managerial replacements (Oracle Corporation, 2012). Step 5- leadership reward and career planning for members in management should be developed by the company in order to retain them for long period of time. As a career development plan, the company should create new hierarchies as part of career plan for leadership candidates. Step 6- as part skill development roadmap for members in management team, the company should encourage them to pursue short term courses and educational degree program which can develop their interpersonal skills. In such context, rotational assignments, coaching and job shadowing can be used the senior management as part of less-formal learning among leadership candidates. For example, Coca-Cola used 2 day long pilot study and psychological simulation program to develop leadership skill among 8 marketing leaders for the company (Oracle Corporation, 2012). Step 7- as part of retention program, senior management should develop both monetary and non-monetary reward and compensation plan to retain leadership talent. As part of reward strategy, the outdoor activity centre should adjust salary and bonuses for members of management in order to attract and retain them throughout leadership development program. Consideration of research work of Armstrong, Murlis and Group (2007) reveals the fact that senior management of the outdoor activity centre needs to mix financial and non-financial incentives in optimal manner while designing reward strategies. As part of reward strategy, performance related pay structure should be incorporated by balancing variables like fixed pay, bonus scheme, profit sharing schemes, fixed pay and performance related incentives. While deciding the reward strategy, senior management should use 3 way mechanisms to decrease biasness in strategy choices. Phase 1- comparative analysis of job responsibilities and job descriptions of organizational members of different companies present in the same industry should be done in order to understand industry standards. Phase 2- confidential market research regarding pay structure of employees in same industry should be done with the help third party consults. Result of the survey should be segregated in with the help of clustering function by comparing pay system in different companies and importance of the division. Phase 3- On the basis of cluster analysis, new reward strategy should be developed, refined and filtered in order to incorporate sufficient flexibility in it (Armstrong, Murlis and Group, 2007). Senior management should segregate employee base in terms of their job functions and then deploy market indicator based reward system. From monetary perspective, pay scale for participants in leadership program should be divided into two parts such as base pay (fixed monthly payment) and performance driven incentives. In some cases, profit sharing can be used as additional monetary benefits for organizational members. As industry example, IBM founded different recognition levels such as Eminence & Excellence, Hundred Percent Club and Enterprise to engage employees. Such performance specific recognition norms can be used by senior management to not only develop leadership skill among members but also retain top talents in the board (Armstrong, Murlis and Group, 2007). Following model can be used to highlight approach that has been used for address key issues in the case analysis. Table 1: Structural Case Analysis Model Issues Possible Solution Choices Justification Time Frame Costs Developing roadmap for leadership development program 1- General coaching and mentoring of members in management team 2- 7 steps comprehensive leadership development program 7 steps comprehensive leadership development program Selected model addresses all the pertinent issues regarding leadership development in comprehensive manner. 12 months to 18 months $1000/member for yearlong leadership development program. Developing proposal for reward strategy 1- Non-market and non-performance indices driven pay system 2- Market reward pay system Market and performance specific reward system Selected model gives opportunity of industry benchmarking and decreases scope of dissatisfaction regarding compensation among organizational members. 12 months $100/employee for conducting market research for pay system benchmarking (Source: Wolsey, Abrams and Minten, 2012) Success of proposal can be measured and evaluated by using following equation given by R. Sale and M. Sale (2005). (Source: R. Sale and M. Sale, 2005, p. 925) According to above model, success of the proposal will be measured after yearlong study during implementation of suggested proposal by senior management. Performance goal will be set at the initial phase and actual performance achieved will be measured after completion of one year. Unbiased mathematical measurement model will be used for success evaluation. 10% gap in the performance measurement will be allowed due to consideration of unpredictable nature of employee engagement and casual errors relating the process. However, for beyond 10% gap in evaluation and measurement of success of recommended proposal, senior management will Get additional 6 months to identify errors and cause of performance variance in previous last 1 years strategy and take corrective actions to rectify these errors. Reference List Armstrong, M., Murlis, H. and Group, H., 2007. Reward management: A handbook of remuneration strategy and practice. London: Kogan Page Publishers. Caligiuri, P., 2006. Developing global leaders. Human Resource Management Review, 16(2), pp. 219–228. Daft, R. L., 2008. The leadership experience. 4th ed. Mason, OH: Thomson South-Western. McCall, M. W. and Hollenbeck, G. P., 2002. Developing global executives: The lessons of international experience. Boston, MA: Harvard Business School Press. Neilson, G. L. and Pasternack, B. A., 2005. The Cat That Came Back. [online] Available at: [Accessed 16th January 2014]. Oracle Corporation., 2012. Seven Steps for Effective Leadership Development. [pdf] Oracle. Available at [Accessed 16th January 2014]. Sale, R. S and Sale, M .L., 2005. Lending validity and consistency to performance measurement. Managerial Auditing Journal, 20(9), pp. 915-927. Wolsey, C., Abrams, J. and Minten, S., 2012. Hrm in the sport and leisure industry. London: Routledge. Read More