Human Resources Practices and Policies - Essay Example

Topic: Lecturer: Presentation 0 Introduction 1 Purpose The purpose of this report is to make recommendations on HR practices and policies. It will focus on training, learning and development, reward and employee relations and how these can be leveraged to overcome the performance problems (declining sales) at Tesco Plc in the UK. 1.2 Organisation Background Tesco is the UK’s leading retailer, the largest supermarket and largest private sector employer. It employs more than 310, 000 colleagues and operates more than 3300 stores in eight formats: Tesco extra (248), Tesco home plus (12), Tesco (482), Tesco Metro (194), Tesco Express (1709), One Stop (748), Dobbies (34) and 6 dotcom only stores. It provides 8, 000 core products and its own-label sales account for half of total UK sales. In the financial year 2014, it boasted of £43.6 billion revenue and £2191m trading profit (Tesco PLC Annual Report 2014, 8). Its main purpose is “to make what matters better, together” (Tescoplc.com, 2015). This is achieved through commitment to its three main values: no one tries harder for customers, treat people the way they want to be treated and use our scale for good. It is headquartered in Hertfordshire, England under the slogan Every little helps and aims at providing cheaper prices, improved quality, stronger ranges and better services. However, it operates under harsh economic conditions especially as a result of the 2007 economic crisis and also a highly fragmented and competitive environment with its main competitors being Asda, Sainsbury, and Morrisons although small retailers like Aldi, Lidl and Waitrose are giving them tight competition in recent years (Anderson, 2015). Tesco has been undergoing a difficult time with stagnant sales, declining profits and in addition, a £250m hole in profits leading to decline in its share prices. In the FY 2014, it experienced a revenue growth of 0.0% and sales growth of 0.5%. Its trading in UK declined by 3.6% whilst its employee retention rates dropped by 1% although they are still strong at 90% (Tesco Annual Report, 2014, 16). In light of this, it needs improvements on its training and development, reward strategy and employee relations. 2.0 Training, Learning and Development Training, learning and development are essential in any organisation wishing to have sustainable competitive advantage. Training provides and /or improves skills necessary for performance of job tasks whereas development is to enhance abilities of employee for greater long-term good of organisation. The purpose of training and development is to promote organisational performance (Uma, 2013, 137). Organisation learning is the process of creating, sharing, diffusing and applying knowledge in organisations (Saks & Haccourn, 2010, 35). Instead of focusing on individuals, organisation should focus on the whole system to ensure that knowledge is distributed organisation-wide while at the same time enabling development of knowledge, skills and abilities (KSAs) of individuals to perform tasks. 2.1 Benefits of Training and Development to the Organisation Training, learning and development have shown to have high impact on organisation effectiveness and competitive ability. Provided it is linked to organisation strategy, it becomes a strategic activity in the organisation aimed at ensuring sustainable competitive advantage. Some companies view spending on training and development as a waste of resources as in the end, some employees leave after training or because benefits are not easily realisable. However, research has shown that increased spending on training and development leads to higher sales gross profit, and increased productivity (Saks & Haccourn, 2010, 7). One research study showed that spending 6% of payroll on training achieved 57% sales increase per employee, 37% gross profit per employee and 20% high ration in market-to-book values (Saks & Haccourn, 2010, 7). If leveraged, it can be of much benefit to the organisation. Another benefit is that it improves the organisations ability to attract and retain talented staff. There are those employees who value career growth and advancement more than salary increments especially the young generation. Offering training and development is a great opportunity for career enhancement thus attracting potential employees and also ensuring commitment and engagement for those already on the job (Uma, 2013). Moreover, it keeps employees motivated and satisfied with their jobs hence increased retention and productivity. The organisation also is transformed into a learning organisation where knowledge and skills are shared continuously organisation-wide. This makes the organisation a high performance and effective organisation (Saks & Haccourn, 2010, 36). A learning organisation operates under five principles stipulated by Peter Senge in his book The Fifth Discipline: The Art and Practice of Learning organisations in 1990. These principles are that everybody learns in the organisation, learning be formal and informal, it be part of change process, it is continuous and management to view learning as an investment in future and not an expense (Saks & Haccourn, 2010, 37). 2.2 Benefits to Employees Training and development is not only useful to the organisation but also its employees. They learn new skills and knowledge that enables them to perform their jobs efficiently and with greater confidence (Armstrong & Baron, 2005). Furthermore, it leads to higher earnings, improved marketability, and greater employment security as employees have the necessary skills required for the job. Research (Saks & Haccourn, 2010, 10) indicates that training and development increases wages by 4-11%. It is also a chance for career advancement and promotional opportunities. 2.3 Training Process and Delivery For it to be effective, training, learning and development needs to be a planned process with a training programme. It needs development of a lesson plan, a trainer and trainees, training materials and equipment, training site, and schedule (Saks & Haccourn, 2010, 255). Choosing a trainer is essential as it determines the success of the training programme. Trainer can be a subject matter expert as in the case of Starbucks or line manager or colleagues if it is an on-the-job training. Those undergoing training also need to be selected as not all staff can be on training. This mainly results from performance management and appraisal results as those underperforming need training (Armstrong & Baron, 2005). Training can also result from needs assessment procedure that identifies company-wide skills and knowledge gap. Training can be individual, company-wide or industry-wide. Needs assessment involves analysing the importance of training against the costs to be incurred to determine if really it is needed (Saks & Haccourn, 2010, 102-118). The stakeholders should be consulted in the process to gain their approval and commitment. Analysis of resources is also done to determine if it is feasible and to determine if training is the best solution. Read More