A Great Challenge in Terms of Human Resource Management - Essay Example

Introduction Kirsten Schaffner Irvin was a homemaker in California. Financial problems compelled her to take up a certain job that would provide her the scope to look after her children as well as earn money for her household. Irvin’s family before marriage owned a fuel business and she had considerable knowledge about the fuel delivery industry. She wanted to be her own boss and thus she came up with her own company- Team Petroleum. Irvin believed that greater efficiency could be brought about in the fuel delivery system. She wanted to provide a certain added value to her customers. Since the company did not own any fuel trucks or oil wells, she decided on buying fuel from the suppliers. She came up with an innovative idea of fuel supply to her customers which she believed would help her to gain an edge over her competitors. Team Petroleum’s computer system was linked to the customer’s fuel tanks. This helped them to track the customer’s fuel consumption and delivery would be made immediately when the customer’s tank would require a refill. This ensured increased efficiency in the fuel supply chain. Team Petroleum enormously expanded over a period of 20 years. They entered into several strategic alliances and the company earned high revenues. Irvin brought about certain changes in the organization by appointing a new management team and renamed Team Petroleum as TeamFuel. The decision for bringing about changes in the organization policies and design posed a great challenge. This change has become essential since the organization has grown enormously and the competitive external environment demands the change. A new management team is being appointed; as a result they will have their own style of management. They will implement their own policies. The organization is bound to face a transformed environment. The challenge for TeamFuel is to ensure that this change is implemented successfully and without creating any kind of disturbance in the working of the organization. The redesigning process at TeamFuel has to be carried out in a systematic and synchronized manner. Since the organization is growing thus the need for human resource is increasing. Recruitment will take place at all levels in the organization. An effective human resource planning has to be done. The key skills required in the various positions have to be identified and the skills of the existing as well as the future employees have to be matched with the competencies required in the organization. Succession planning is also important in the context of the changed environment at TeamFuel. The top level positions have to be filled up carefully since the success of the organization depends on their effective leadership skills. Succession planning will help in identifying the people who are suitable for the top level positions. Employees who have good prospects to rise in the organizational ladder have to be identified and their skills have to be nurtured. A planned and systematic approach will definitely ensure long term success for the organization. Application of Theories SWOT Analysis A SWOT analysis is a tool which is used to analyze strengths, weaknesses, opportunities and threats of an organization in terms of both internal and external factors. It is an integrative approach and includes environmental and company specific variables. SWOT analysis can used to formulate a marketing strategy by using the company’s corporate strengths and handling its weaknesses (Bohm, n.d.). Strengths Irvin’s knowledge of the fuel delivery industry was her prime strength. She had experience in the working of the industry because her family was also involved in fuel delivery business. The innovative fuel delivery system that she had conceptualized provided her an edge over her competitors. This system enabled them to establish efficient supply chain for fuel. The various strategic alliances that TeamFuel had entered into would provide the company added benefits. Opportunities TeamFuel are providing added value to their customers. The special fuel delivery service they are providing is unique to their company. This will help them to charge higher prices than their competitors. They can thus increase their revenue. They are helping their customers in reducing their fuel budget. Thus, the customers will be willing to pay the higher price charged by them. The strategic alliances will provide them benefit of synergy. Weakness The company is poised for a redesign. The management team is being changed. A change in organizational design is a great challenge. It is often seen that the design is done by concentrating exclusively on the formal structure of the organization and thereby ignoring subtle aspects like cultural, social and political dynamics of the organization. The redesign should be linked to the strategic objectives of the organization. The change phase could make the organization vulnerable even if for a short period and competitors could take advantage of it (Wyman, 1998). Irvin was basically a homemaker and her intention was mainly to take care of her children and earn extra income. Therefore, it might not be possible for her to closely supervise the business in the near future. This might put her at a disadvantageous position in comparison to her competitors. Threat The change that is being implemented in the organizational policies and the organizational design may fail. The new management team that is being appointed may not be able to fulfill their job responsibilities. The company’s expansion had made it imperative to recruit human resource. An inadequate fit between the personnel and the job may create adversities in the organization. Moreover, the company may have to face threat in the form of new competitors. Human Resource Planning in TeamFuel In the words of Vetter, “Human resource planning is the process by which management determines how the organization should move from its current manpower position to its desired position. Through planning, management strives to have the right number and the right kind of people, at the right places, at the right time, doing things which result in both the organization and the individual receiving maximum long- run benefits” (Jackson & Schuler, 1990). TeamFuel’s growth has made it necessary to recruit new employees. Moreover a new management team is also being appointed. HR planning is essential at present to handle these issues. Human resource planning in TeamFuel should involve the following steps: Making Demand Forecasts for Human Resources This involves anticipating the company’s future for human resource needs and accordingly planning on how to fulfill those needs. Objectives are established and various programmes are implemented to ensure that people with the required skill set are available when the organization needs them. Various forecasting techniques are employed by organizations namely trend analysis, expert forecasts and mathematical models like regression, budget and planning analysis and optimization models. Job analysis, work load analysis and workforce analysis should be carried out (Rao, 2005). Making Supply Forecasts for Human Resources This involves making an estimate of the available human resource within TeamFuel Organizations. These are the internal and the external sources. Data related to the existing employees at TeamFuel should be maintained. The forecasting techniques used are Markov’s analysis, skills inventory, staffing table and replacement chart. Markov’s analysis is based on historical data related to promotions, turnovers and transfers. The skills inventory involves maintaining records regarding the skill set of employees working at present in TeamFuel. Staffing table involves classification of employees based on their experience, skills, position, category, qualification, age and sex. Replacement chart maintain department wise profile of employees (Rao, 2005). Identifying Gaps in Human Resource The existing number of employees and their skills are matched with the future human resource needs of TeamFuel. This helps in identifying gaps in the human resource needs (Rao, 2005). Making HR Plans HR plans are formulated based on the organization’s needs (Rao, 2005). TeamFuel is a growing organization and consequently the need for manpower is also increasing. It is important that they should identify the future manpower needs and try to match the skill set of employees with the job. They have to ensure that the right person is on the right job. The New Delivery Process at TeamFuel The new delivery system of TeamFuel was an initiative to provide added value to customers. This was a service which TeamFuel’s competitors were not providing and thus it provided them a competitive advantage. The customer’s fuel tanks were linked to the computer system at TeamFuel. This enabled them to track the customer’s fuel consumption and deliver fuel immediately when required. The customers could save money on their fuel budget and an efficient fuel supply chain was established. The supply chain would ensure continuous uninterrupted supply of fuel. Affects of TeamFuel’s Delivery Process on the HR Planning in the Organization The delivery process in TeamFuel requires competent IT people. The IT people have to establish an automated system whereby the computer system at TeamFuel is linked to the customer’s fuel tanks. Thus, technical expertise is required to manage this fuel delivery system. People with the required technical skills have to be deployed for the job. The essential feature of this fuel delivery system is continuous uninterrupted fuel supply. Efficient supply chain management is extremely important. The employees who are a part of the supply chain management of the organization should be chosen carefully. They have a major role to play in ensuring success for the fuel delivery system. They have direct interaction with suppliers and maintaining good relation with the suppliers is essential. It is the suppliers who support the delivery system through their timely fuel delivery. HR plans related to recruitment and training has to be made. Job analysis should be carried out to identify the skills required for the job. Moreover, employee retention plan especially for the IT people has to be made. This is because the company cannot afford to waste time on training new personnel. Succession Planning Succession planning involves identifying the future leaders of the company and training them with the aim that they can fit into their new job role. This involves review of the strategic plan of the organization, the workforce and developing the employees aiming that they become competent enough to replace the leaders who are about to retire or leave the organization (Atwood, 2007). TeamFuel is appointing a new management team and the position at the management level have to be filled up. This requires proper succession planning. Succession planning occurs in the following phases: The Scope for Succession Planning is Explored TeamFuel’s strategic plan is reviewed. The attrition rate is determined and also the future retirements in the organization. The scope for preparing a succession plan keeping in mind the external factors is explored. Succession Plan is Created A bottom up approach should be taken while creating the succession plan at TeamFuel. In this method, the lower level managers are consulted regarding who should replace the top level positions. Their recommendations are later reviewed by the managers at the next higher position. The succession plan is made keeping in mind the job functions, the skills and knowledge required and the human resource available at present in TeamFuel. A gap analysis is conducted and priorities are established. Implementation of the Succession Plan The method and the criteria pertaining to succession planning have to be communicated to those who are concerned at TeamFuel. Various strategies have to be adopted in order to ensure smooth implementation of the plan (Hastings, n.d.). Succession planning tries to ensure that the right leadership is available at the right time and at the right place. Succession planning at TeamFuel can be based on two models. Succession planning may be based on the competency model whereby the competencies required at the high level positions are communicated to all employees in TeamFuel. Anybody can aspire to reach the top level position by personal skill enhancement. Another model used in succession planning is the acceleration pool model. In this model the employees with high potential are identified and groomed by the organization with the aim to fill up the top level positions in future (Cornerstones4kids, 2010). Role of Succession Planning in Context of the New Management Team The new management team has to develop the expertise demanded by their new job role. TeamFuel has to plan the succession in a step-by-step manner. They have to develop objectives for the succession planning programme. The possible objectives would be to bring about the succession as smoothly as possible and avoid probable disturbances and deterioration in job performance. The next step involves determining the key positions. All the management level positions are key positions. In the next step, the present as well as the future requirements of the job are assessed. This is done through job analysis. Job analysis helps to determine the skills required for a particular position and the level of performance required in that position. The future position that might arise in the organization and the skills required from people who would fill those positions are also assessed. The final step involves identifying the potential of people who would be the probable successors. Individuals who are performing well in their present position may not necessarily perform well in their elevated position (Stup, n.d.). Conclusion Irvin had decided on bringing about a change in Team Petroleum. The first step towards the transition was the change of the name into TeamFuel. The organization was geared to bring about a change in its policy and design. There were several factors that were to be considered in the change implementation. An analysis of the present scenario in the organization and the organization’s capability to adjust to the change was required. A SWOT analysis revealed that the prime strength of the company was the new fuel delivery system that was conceptualized by the owner. Moreover, Irvin’s industry knowledge was an added benefit. The strategic alliances that the organization had entered into would provide them the benefit of synergy and strengthen their position. They have the possibility of reaping the benefit of their fuel delivery system for many years to come. The fact that Irvin will not be able to devote much time to her business in the future may be disadvantageous for the organization. Moreover, the changes that are being implemented in the organization have placed them in a vulnerable position. The organization has grown enormously over a short span and a new management team is being appointed. This will pose a great challenge in terms of human resource management. Human resource planning has to be done in a systematic manner. Predictions have to be made regarding the present requirement of human resource as well as the future requirements. Moreover, the human resource already present in the organization also has to be assessed in terms of their skills and whether they are matching up to the needs of the organization. The HR planning has to be done keeping in mind the innovative delivery system and the skills required from the people who will manage this system. The management team also has to be selected carefully with the intention that they can meet the organization’s needs. Since a new management team is being appointed, hence effective succession planning has become crucial. It is essential to identify the future leaders who have the necessary acumen demanded by their job role. The competencies required in the particular job position are assessed and accordingly the leaders suitable for the position are identified. Succession has to be brought about smoothly and it should be ensured that no discontent arises amongst the employees. References Atwood, C. G. 2007. Succession Planning Basics. American Society for Training and Development. Bohm, A., No Date. The SWOT Analysis. GRIN Verlag. Cornerstones4kids, 2010. Competency Model. Succession Planning. [Online] Available at: http://portal.cornerstones4kids.org/content184.html [Accessed December 20, 2010]. Hastings, S., No Date. Succession Planning: Information Lifeline. American Society for Training and Development. Jackson, S. E. & Schuler, R. S., 1990. Challenges for Industrial/Organizational Psychologists. Human Resource Planning. [Online] Available at: http://www.rci.rutgers.edu/~sjacksox/PDF/HRPlanning.pdf [Accessed December 20, 2010]. Rao, V. S. P., 2005. Human Resource Management. Excel Books. Stup, R., No Date. Steps in Succession Management. Succession Planning. [Online] Available at: http://www.das.psu.edu/dairy-alliance/pdf/succession-planning.pdf [Accessed December 20, 2010]. Wyman, O., 1998. The Pitfalls of Redesign. Strategic Organization Design. [Online] Available at: http://www.oliverwyman.com/ow/pdf_files/Strategic_Org_Design_INS.pdf [Accessed December 20, 2010]. Bibliography Berke, D., 2005. Succession Planning and Management: A Guide to Organizational Systems and Practices. Center for Creative Leadership. Parsons, M. L. & Et. Al., 1998. Interdisciplinary Case Studies in Health Care Redesign. Jones & Bartlett Learning. Read More