Strategic Human Resource Management - Apple - Case Study Example

DRAFT Strategic Human Resource Management as a factor in driving business strategy- a Case study of Apple A business strategy can be described as simply the mode through which a company approaches a market. It involves factors such as the target customers, business location and the type of products and services to offer. There are three major types of business strategies used by businesses today; cost strategies, differentiated or unique products and services strategies and niche focus strategies. A business or a firm can adopt any of the three to ensure its competitiveness in a certain relevant field. Cost strategies largely involves a business relying on lowering its products and services prices and thus getting competitive relative to its competitors. Typically, this strategy is achieved through enhancing cheap and economic ways of production which consequently leads to lower prices of the goods in the market. This strategies is mainly used by businesses that have achieved economies of scale. Producing differentiated and unique products and services is another strategy used by businesses today. A business produces quite unusual products and services through addition of special features and specifications that differentiate the products from those of other competitors. In most cases, products from companies that employ this type of strategy are relatively more expensive than those of its competitors. However, most of such customers remain loyal to these kind of companies largely due to the added value that they get for their money from buying the goods. Another common business strategy used today is a business’ focus on a certain market niche. Businesses that adopt this approach tend to combine both the cost strategies while also producing unique products and services. Such companies focus on serving a specific niche of consumers by producing certain products and services and thus serving that niche in a way better than any of its competitors due to the deep understanding of the customers. A common strategy of niche focus is a business targeting middle-class consumers or urban, high-class customers. Apple Inc, popularly referred to as simply Apple, has been a successful company in the very competitive industry of consumer electronics for close to 40 years now. For this success, Apple has all along employed the business strategy of producing differentiated and unique products for its customers. Apple is known to produce high quality goods and excellent customer services although their products are quite expensive as well. However, despite facing stiff competition from other competing firms, Apple continues to rely on its research and development team of talented workers to create products that are innovative, reliable and with high-performance ability. The company is very strict in its recruitment processes, only targeting the best talents to join its innovative research and development programmes. In the last two centuries, Apple has been expanding its operations to other new markets, and thus has seen a huge growth of its workforce. According to the company’s annual report for the year 2014, Apple now has 92600 full-time employees. Despite Apple being one of the most valuable and prestigious companies today, there are various human resource issues and challenges facing the company. First, there has been continuous outcry among its employees on the company’s low compensation. Lack of recognition for innovation ideas has been another major source of concern by the employees at Apple. The employees have also raised their concerns about the secretive working environments that they are subjected to which is regarded a huge source of demoralisation. This paper will discuss the human resource issues and challenges in Apple by referring to two main theories of strategic human resource management. The discussion will also provide suggestion through a creation of a human resource strategy for Apple. Strategic Human Resource Management perspectives- Creating a HR strategy to solve human resource issues and challenges in Apple In the past few decades, the popularity of Strategic human resource management (SHRM) has grown immensely and this has been manifested through the continuous debate on the balance between HRM and performance. Some of the common views on this HRM debate include; Human capital (resources) can enhance the competitive advantage of a business or a company. Human resource management practices highly determines the role and impact of the human resources in a business. Human resource management systems of practice can be used to enhance the distinctiveness of a business system due to their complexity. There are various perspectives (models) that describe the relationship between HRM and the performance of a business. Some of the common theories include the Resource Based Theory and the Best fit theory. Strategic Human Resource Management and Resource Based Theory This theory places more emphasis on the effectiveness and efficiency of an organisation’s utilisation of its resources and how this helps to create sustainability of its competitive advantage to its competitors. According to this theory, there are both the internal and the external resources in a business. Internal resources include the human capital (people) who are the most important conditions for a business or organisation to achieve success. The human resource are described as rare, valuable, inimitable and are non-substitutable. According to this theory, the effectiveness of a HRM strategy can be determined by the nature of the selection process of human resource in an organisation. This is achieved through the various qualities of human resources in a firm such as knowledge, experience, risk-taking tendency and judgement. Therefore, an organisation is deemed to be competitive through creating a flexible and intelligent resource base as compared to its competitors. For example, Apple has a very rigorous employee recruitment method which ensures that the company only acquires the best talent available. However, this perspective of HRM has received criticism for its lack of meeting the standards for real theoretical perspective while also containing various redundant elements. The theory also tends to neglect other important contextual factors such as the institutional setting and the market threats among others. The contingency perspective to Strategic HRM This perspective dictates that an organisation’s strategy should incorporate its HR policies and practices if it is to achieve an improvement in its performance. In this model, the common approach used to achieve the alignment between an organisation’s strategy and its HR policies and practices is referred to as the best fit approach. Under the best fit approach, the HR practices adopted by an organisation are determined by its strategic position in regards to its cultural and structural environment. There are four various types of fits; strategic fit, organisational fit, environmental fit and internal fit. A recommended Human Resource Strategy for Apple Inc. Following the discussions on Apple and its Strategic Human Resources Management, there is need for the company to adopt an improved strategy that will help it to continue with its good performance on its business strategy. The recommended strategy will help to tackle the inadequacies exhibited by the company in its handling of human resource. The objectives of the new strategy, therefore, should be as follows; The company should seek to improve its employees’ salaries if it is to improve their productivity and consequently lead to increased profits for the company. The company should improve its relations with the employees through creation of a better organisational structure. This will help to enhance sharing of necessary information with them which will help them better understand the company’s objectives and plans and help it towards achieving them. Apple should also ensure that every employee who comes up with an innovation is rightfully honoured and recognised. The company should also be sensitive enough regarding the extreme demands that it makes towards its employees’ performances. The new improved strategy on Human Resource Management should, therefore, look as follows. Apple should replace its subjective performance measure with the more objective measure which provides a more fair method of performance appraisal. The company should also provide more transparency in its performance evaluation thereby eliminating cases of discrimination. Apple should also focus on providing more training opportunities to its staff while also avoiding the zero-tolerance policy on below-par performance on its workers. The company should evaluate its employees’ remuneration in order to be in line with the industry standards while also increasing the employees’ motivation. Concerning the increased secrecy within Apple, the company should focus on training its employees and other members of the HR department to ensure that they are well versed with Apple’s policies, plans and objectives. The company should also create avenues that facilitate constant assistance between employees and the management. This will help to create a friendly working environment for increased employees’ productivity. Apple should also provide an open platform where innovations by its employees can be exhibited for recognition and honoring thereby eliminating cases of false ownership of such ideas and innovations. The company should also provide room for employee and management interaction which helps to create an environment for provision of feedback and constructive criticism. This is essential for the improvement of the employees which also gives them an opportunity to understand what is expected of them in the company. The Human Resource Management policies should facilitate fairness in this process. Read More