Strategic Human Resource Policies and Functions of Bullmans Brewery Co Ltd - Case Study Example

Write an HR Strategy document which acknowledges issues 3 above (in bold writing) and offers realistic solutions in each area. The document should demonstrate you understand the theory behind your plans and be correctly referenced. Contents Contents 2 Introduction 3 Communication of plans for workforce reduction 3 Steps to improve productivity and reduction of unit cost 5 Seek a ‘realistic’ partnership agreement with the Trades Unions 6 Conclusion 8 References 9 Introduction Bullman’s Brewery Co. Ltd. was founded by the Bullman family in 1880 and the company is based out of Liverpool. The company operates two breweries along with 400 public houses in which 1500 people are employed in various divisions of manufacturing and distribution, administration and management of public houses. The company did not have a specific HR strategy till date due to the influence of the trade unionists. Initially the management consulted the trade unions on certain issues of company affairs. In later period, the formal representation of the majority of the workforce was done by Transport and General Workers’ Union who were recognised by the management. After the company was acquired by the Grand Central Hotels Ltd, most of the workers feared about their future security and joined the union to put forward their claims against the low pay scales offered to the staffs, white collar employees and public house managers. In the face of unprofessional and informal approach of the trade unionists, the development of appropriate HR strategy, policies and procedures is essential to attain sustainability of the business in the industry. Communication of plans for workforce reduction The amount of wages paid to the workers of Bullman Breweries Co Ltd. has been lower than the industry trends. However, the workforce accepted the low salaries due to the future security of jobs offered by the company. The situation aggravated due to the fear generated among the workforce as a result of the takeover of the company by Grand Central Hotels Ltd. who joined the Transport and General Worker’s Union to put forward their claims on payment of wages. The problem worsened when the company faced a declining position of productivity and sales in the recent years. The HR strategy that is required to be formulated should take into account the negotiations with the workforce in implementation of the HR policies and functions to cope up with the crisis situation (Jackson, Schuler and Werner, 2011, p.82). The chairman and the senior management consider that any conflict with workforce and disruptive active action resulting from non-consonance with the trade union may result in the loss of productivity and market share. Thus the changes in the HR policies need to be implemented with an amicable settlement with the workforce of the company. The human resource department would have the flexibility to decide on the requirements of the strength of the workforce based on the requirements of the breweries (Snell and Bohlander, 2012, p.64). As the situation of employment worsened in the areas of Liverpool, Lancashire and Merseyside, the demand for beer declined in the market. Thus the company was faced with a situation where there were wastes in the production of the company and the earnings of the company reduced drastically. The company would employ human resource personnel to explain the current facts and figures and the requirements of workforce of the company. It is the duty and the responsibility of the human resource personnel to communicate to the workers and the trade unions on the decision of the company for reduction of the workforce is order to cope up with the situation of declining demand (Datta, 2010, p.285). Any form of grievance and protest from the trade unionists and the workers is required to be dealt by the human resource personnel of the company. The human resource personnel would listen to the concerns of the workers and their appeals and take necessary steps for reconciliation in order to implement the decision of the management on the reduction of the workforce in a smooth fashion (Huselid and Becker, 2006, p.902). The company would protect the best interests of the people and the organization and would carry out their operations with the support and agreement of the workers and the trade unions. Any for of disruptive action from the trade unions would be stemmed by the management that would hamper the interests of the organization (Youndt, Snell, Dean and Lepak, 1996, p.862). Steps to improve productivity and reduction of unit cost The company would take necessary steps for improving the productivity and reduction of unit cost of the brewery items manufactured by the company. Due to the loss of demand of beer in the market arising from the scenario of declining employment, the production volumes of the company has fallen and the workers have been left idle with their work in the distribution and the public houses. After the re-structuring of the workforce, the company would make changes in the system in order to motivate the workers to reach optimum level of productivity. The development of HR strategy for boosting the productivity levels of the workers and reduction of unit cost of the breweries is essential especially because the basic wages of the workers in the company is comparatively low in relation to the industry. The HR techniques to be applied in this case are to be chosen judiciously in order top achieve the desired results. The incentive systems which failed in the past are not be re-applied. Since the overtime expenses constitute about 30% of the earnings of the brewery industry, the company would resort to some other approach for boosting productivity and reducing the unit cost. In order to reverse the position of declining productivity, the company would implement changes in the working process and the reward structure. A system for measurement of the work undertaken by the workforce would be implemented in order to monitor the performance of the workforce (Beardwell and Claydon, 2010, p.91). The changes would be brought about in the work process through implementation of benchmark standards in the area of work. The benchmarks would be fixed in the various areas of quality, production quantity, performance accuracy, learning approach, additional responsibilities undertaken, etc. The employees who are able to perform according to goals and objectives of the organization would be rewarded on a certain scale designed by the management (Marchington and Wilkinson, 2008, p.48). The excellence achieved in the individual productivities would be measured by the performance management structure and accordingly the workers would be rewarded. This would help to motivate the workers in achieving improved productivity. The strategy also includes inclusion of a job evaluated pay structure as a matter of priority where the actual productivity of the workers would be compared with the benchmarks to rate their performance on a common scale (Armstrong, 2009, p.83). According to their performance the pay wages of the workers would be fixed by the company. The distribution facilities of the company are mostly not a “state of art” establishment. The maintenance cost of this distribution plants and depots are high and thus incur huge costs for the company. In order to reverse the situation of loss, the high cost of operations would be avoided by shutting the old facilities of production and distribution that lacks modern equipments and appliance. The other establishments would be modernized and attainment of optimum productivity with the required workforce would help the company to attain economies of scale. Seek a ‘realistic’ partnership agreement with the Trades Unions The Transport and General Workers’ Union have been formally recognised by Bullman’s Brewery Co. Ltd. and the trade unionists have a significant role to play in the operations of the company. The trade unionists represent the interests of the workforce of the company. In case of any changes in the HR policies and functions of the organization that is implemented by the management, the trade union has the role to ensure that the workforce is not discriminated from the benefits due to the implementation of the HR policies (Anderson, 2013, p.87). The trade union represents the interests of majority of the workers and engages into negotiation with the management for putting forward the claims of the workers regarding the revision of the pay structure. The human resources department should take into consideration that the wages and the pay structure of the workers are already low as per the industry standards. In order to boost the productivity of the workforce, the HR strategy is to seek a realistic partnership agreement with the trade unions (Wilton, 2013, p.276). The fixation of the salary structure of the workers would be done in consultation with the trade unions. This would also enable the trade union to put forward their claims on behalf of the workforce. This would lead to an amicable settlement on the decision of the wage structure and the allocation of roles and responsibilities of the workers. The partnership agreement between the company and the trade unions would lead to evolvement of the role of trade unions as intermediaries. The trade unions would put forward acceptable terms to the company in case of fixation of wages and reward structure for improving the productivity levels of the company (Bratton and Gold, 2012, p.61). The communication of the wage policies of the company and the reward systems in place for the workers would be communicated to the workforce through the trade unions. This would lead to better counselling of the workers on the terms and conditions of the HR policies (Guest, 2007, p.521). Any discontent among the workers would be taken care by the body of trade union which would result in neutralising the informal and unprofessional approaches by the workers. The partnership agreement with the trade union would also provide a sense of ownership to the workers and the trade unionists in the operations of the company. This would lead to peaceful co-existence of the management and the workers driving a balanced growth of productivity due to a mutually agreed wage structure (Delery and Doty, 1996, p.835). Conclusion Bullman’s Brewery Co Ltd. has a low wage structure as compared to the standards of the industry. The Transport and General Worker’s Union represents the interests of the workers of the company. As the company lacks strategic HR policies and functions, the HR strategies were essential to meet the declining position of the company’s productivity and sales. The strategies include reduction of the workforce of the company in order to cope up with the falling demands in the market. The changes in the HR strategies are to be implemented with the agreement and support of the trade unions and the workers. The disruptive action of the trade union is likely to affect the production of the breweries which would lead to plunge of the market share. In order to boost the productivity, the company would strategically implement the changes in the work process through implement of a performance management system. The costs would be controlled by shutting down the old plants and machineries that lack modernization and impose high cost of maintenance. References Anderson, V. 2013. Research methods in Human Resource Management 3rd Edition. London: CIPD. Armstrong, M. 2009. A Handbook of Human Resource Management Practice. London: Kogan Page. Beardwell, J and Claydon, T. 2010. Human Resource Management: A Contemporary Approach 6th Edition. London: Prentice Hall. Bratton and Gold. 2012. Human Resource Management: theory and practice. Basingstoke: Palgrave MacMillan. Datta, et al. 2010. Causes and effects of employee downsizing: a review and synthesis. Journal of Management. 36(1), pp.281-349. Delery, J. E. and Doty, D. H. 1996. Modes of Theorizing in Strategic Human Resource Management: Tests of Universalistic, Contingency, and Configurational Performance Predictions. Academy of management Journal. 39(4), pp.802-835. Guest, D. E. 2007. HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS. Journal of Management Studies. 24(5), pp.503-521. Huselid, M. A. and Becker, B. E. 2006. Strategic Human Resources Management: Where Do We Go From Here?. Journal of Management. 32(6), pp.898-925. Jackson, S., Schuler, R. and Werner, S. 2011. Managing Human Resources. Stamford: Cengage Learning. Marchington, M. and Wilkinson, A. 2008. Human resource Management at Work: people management and development. London: CIPD. Snell, S. and Bohlander, G. 2012. Managing Human Resources. Stamford: Cengage Learning. Wilton, N. 2013. An Introduction to Human Resource Management. London: SAGE. Youndt, M. A., Snell, S. A., Dean, J. W. and Lepak, D. P. 1996. Human Resource Management, Manufacturing Strategy, and Firm Performance. Academy of Management. 39(4), pp. 836-866. Read More