Strategic Choices in HRM - Case Study Example

Strategic Choices in HRM Table of contents 0 Introduction..............................................................................................................3 2.0 Different measures of analysis and practical evidence...................................3 2.1 Redeployment ....................................................................................3 2.2 Secondment..........................................................................................4 2.3 Flexible working...................................................................................5 2.4 Comparisson.........................................................................................6 3.0 Strategic HRM....................................................................................................6 3.1 Definations of strategi HRM.........................................................................6 3.1.1 Proactive approach......................................................................................6 3.1.2 The Harvard Model (HRM)......................................................................6 3.1.3 Vertical and horizontal fit.........................................................................7 3.2 The extend of strategic .................................................................................7 3.2.1 Achieve HR outcomes with the Harvard Model......................................7 3.2.2 Vertical fit HR strategy perspective ........................................................8 3.2.3 Horizontal fit HR strategy perspective...................................................8 4.0 Reccommendations..............................................................................................8 4.1 Accept Redeployment ....................................................................................8 4.2 Secondment .....................................................................................................9 4.3 Accept Flexible working ................................................................................9 5.0 References..................................................................................................................10 1.0 Introduction Standfast Insurance is to encounter a 25 million pounds budget deficit in the coming 5 years as a result of diminished market share. Apart from the budget deficit, the company is to encounter other challenges including the need to address rises in demand from customers. Therefore, in order to tackle the external and other influences, Standfast Insurance needs to come up with appropriate strategies that will ensure a right mix of skills. The company intends to improve quality and concurrently avoid redundancy. Thus, this paper provides the outcome of the measures, which include vacancy management, redeployment, secondment and flexible working hours. 2.0 Different measures of analysis and practical evidence 2.1 Redeployment The company will also conduct employee redeployment, an activity whereby workers are moved from one working environment to another. The reasons for reassignment will be to increase efficiency, to reduce costs or for the purposes of trainings to build on the skills workers. Redeployment and retrenchment of workers cause’s stressful conditions to the employees as there remain uncertainties about their future in terms of security of their current occupation. During the redeployment process, employees are expected to maintain their performance under the changes in the workplace cultures, organisational structures and changes in the role they play in their works and responsibilities. Job insecurity is termed as being cross-sectional, moist researches are conducted either after the redeployment has been conducted or during the time when the affected individuals are trying to cope up with the new job environment. Therefore, it remains to be known how the workers manage to cope up with the extensive change of environment and how it correlates to the different stages of redeployment. In addition, it remains unknown how different individuals or the organisation cope up with the impacts of redistribution. Job uncertainties affect an organisations cultures; redeployment entails that in every point in time there shall be a new face in the team (Koontz 2009, p.179). The cultures may be different from their new organisation; consequently, this will impact the healthy organisation culture that had been put in place before the initialisation of the process of downsizing that affects the employee. Redeployment without a pay increment is a form of discouragement to the employee. However, modern managers have instituted a program of redeploying workers where they accompany them with a salary increase. 2.2 Secondment Standfast Insurance has a plan to loan its workforce to another company. Secondment can be defined as the process that occurs mostly in public organisations where workers are loaned to other organisation in the same or different capacities. However, the process takes place for a small period, the practice is different from the redeployment. Research has shown that emotional health complications face people who go through secondment. Despite being done with an aim of building on the skills of an individual, the method has been found to be as uncertainty. Previous researches have shown that, when employees are confronted with different uncertainties, or stressful conditions that result from secondment, they end up being faced by lack of personal control. Lack of personal control makes the individuals not to respond well to the changes. Organisation culture is directly impacted since cultures are set by the administration section of the organisation and later implemented by the management of an organisation. Every employee is made aware of the practice that governs the organisational behaviors. The methods are bound to the employee, and they must maintain an allegiance to the cultural behavior (Morgan 2009, p.116). Hence, in times of secondment it may take time for the individuals to cope up with the new cultures of the organisations they shift. Individuals’ performance is also affected due to the changes of the environment, naturally before a person changes to a new environment it takes time. During secondment, it is advisable that the secondee are taken though a refresher course that will enable them to cope up fast to their new environment. Employee motivation can also be enhanced through secondment. This is achievable by ensuring that the employee is appraised after going through the secondment process. Alternatively, the position the individual held during the period of secondment is retained by them. Secondment can be an excellent source of minimizing the expenses usually the resources that are budgeted for the use of human resource. conversely, Secondment has a positive consequence on the organisation that the individual work for during the secondment process (Purcell & Sisson 2010, p.114). There are skills, knowledge and experiences that are taken to the new place of work by the worker. 2.3 Flexible working arrangements This refers to the change in work patterns and culture from full-time to flexible working hours either through home-based working and part-time work. Flexible working arrangements aim at retaining valuable staff and matching the number of workers to the avaivable skills needs in the organisation. The approach leads to higher work satisfaction due to ability to fit the working hours to the individual commitments. The company can implement this approach through provding voluntary reduced working time that is accompanied by proportional reduction in the salary or implement part-time working program. The company can also voluntary unpaid leave when faced with excess workforce in order to control the staff costs. In order for Standfast Insurance to be successful, flexible working arrangement is essential since it will increase the staff retention and lead to optimum skills in the company (McTavish & Miller 2009, p.282). 2.4 Comparrisson According to the above analysis, all the three options that include redeployment, secondment and flexible working hours have positive implications in human resource management at the company. Redeployment is essential in managing human resource costs while secondment is essential in ensuring employees are multi-skilled. Accordingly, flexible working hours will retain valued employees and lead to higher motivation and productivity in the company. However, secondment may lead to job-related stress due to exposure to new organisational culture and procedures while redployment may demoralise employees especially when not accompanied by corresponding salary increment. The selection of HR strategy should aim at improving productivity, controlling cost and improving job satisfaction and thus flexible working hours offers more benefits than the other two strategic options. 3.0 Strategic HRM 3.1 Definations of Strategic HRM 3.1.1 Proactive approach According to this approach, strategic HRM is concered with proactive analysis of the future organisational human skills needs and taking proactive measures to ensure the organisation has the right mix of skills. The HR managers engage in external environment analysis, skills audit and corporate planning in order to integrate the HR strategy with the corporate strategy. Proactive approach is the basic definition of strategic HRM since it anticipates problems in staffing levels and training needs in order to ensure a mitigation plan that aims at maintaining the productivity. 3.1.2 The Harvard Model (HRM) The Harvard model of HRM is also referred as the ‘soft’ HRM and focusese on the HR outcomes such as the job satisfaction, motivation and productivity in the entire HRM cycle. The Harvard model is essential in attainment of proactive strategic HRM since it aims at ensuring commitment, congruence, competence and cost effectiveness. 3.1.3 Vertical and horizontal fit Krishnan and Singh (2011) classified proactive approach of strategic HRM in to either the vertical fit or horizontal fit. The fit refers to the planned human resource deployments and activities that aim at enabling a company attain its goals. According to Schuler and Jackson (1987), the vertical fit refers to the alignment of HRM practices with the strategic management process of the firm while horizontal fit refers to the congruence among the various HRM practices. Vertical fit is aligned with proactive HRM since it aims at attaining long-term corporate goals and integrates the HR and business strategy. Horizontal fit focuses on the interactive effect between he various HRM functions. 3.2 The extent of strategic HRM 3.2.1 Achieve HR outcomes with the Harvad model The Harvard model focuses on competence, commitment, congruence and cost effectiveness of the HR strategy and thus is essential in deployment and flexible working hours. The company should aim at ensuring employees are involved and aparticipate in decision-making. Deployment will lead to multi-skilled employees and reduce staff costs. Accordingly, secondment can enhance motivation especially when employees are seconded to their preferred working company or agency. HR practices like flexible working hours can be regarded as strategtic especially when the company aims at avoiding redundancy. However, measures such as voluntary flexible flexible working hours should not aim at reducing the current pay, but providing the employees an opportunity to attend to their personal matters. According to this approach, some measures such as secondment are not strategic enough. 3.2.2 Vertical fit HR strategy perspective The vertical fit HR strategy perspective is proactive in nature since it integrates the HR strategy with the corporate strategy. The corporate strategy is reduction of budget while the HR strategy aims at avoiding redundancy and thus a linkage of the two will reduce the overall staff costs and avoid redundancy. In this case, secondment of staff and flexible working arrangements can reduce the overall business cost and avoid redundancy. From this approach, flexible working arrangements and secondment can be defined as strategic enough. 3.2.3 Horizontal fit HR strategy Perspective Horizontal fit is enhanced if their are many options on HR activities aand the aim is to attain congruence among the various HRM practices of the firm. The attainment of congruence depends on the nature of HR strategy, the corporate culture and level of employee skills. In this case, horizontal fit can be attained through integration of redeployment, secondment and flexible working hours and the purpose should be to avoid redundancy and reduce costs of external recruitment. Redeployment may not be accompanied by corresponding reduction in staff costs, but voluntary part-time working arrangements and secondment will reduce the staff costs and avoid redundancy. In conclusion, the three perspectives are strategic in nature, but some measures examined by not attain the HR strategy. However, most of the proposals in the report can be regarded as strategic and viable. 4.0 Recommendations 4.1Accept redeployment The purpose of the report is to provide measures of reducing the HR budget, ensuring quality staff and maintaining high performance while avoiding redundancy. The company should accept redeployment since employees will be exposed to different working environments and maintain their individual performance. The employees will remain motivated and enhance their productivity due to exposure to different job positions with the company. Accordingly, this option is congruent with organisational culture since employees will work within the same company. The approach will avoid redundancy and attend to the high need units and employees may be willing to be redeployed to lower-paying jobs 4.2 Secondment The HR managers must avoid secondment since it will create cultural shock for the employees. Steadfast Insurance should avoid loaning its employees to another company since this may lead to job dissatisfaction due to new working environment, new job procedures and new organisational structure. The secondment process is intensive and may require the employees to take refresher courses before they are accepted in the other company. 4.3 Accept flexible working The company should accept flexibleworking such as home-based working or part-time work in order to avoid redundancy. Steadfast insurance should encourage its employees to take voluntary reduction in the number of working hours and implement a proportionate reduction in the salary levels in order to reduce the overall staff costs and avoid redundancy. The approach will cater for excess staff and maintain individual performance since employees will have enough time to relax thus avoiding job-related stress. The employees will have an opportunity to attend to their individual commitments or take up additional training courses in order to improve their skills levels. 5.0 References Eyre, E. 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