Human Resource Evaluation - Example

HUMAN RESOURCE REPORT EXECUTIVE SUMMARY The saying that image is everything holds true not only for men but also for organizations. Good image of an organization earned by a number of overt and covert actions by management helps attract potential and competent candidates. This is why firms invest heavily in public relations and corporate social responsibility. A good HR department is also a very important tool in image formation. It should be the objective of the organization to come up with a clear HR strategy, this assists in boosting the profitability and productivity. The issues that the organization has to grapple with in formulating a strategy include legal and ethical issue. The company should ensure compliance with law to effectively protect the shareholders and welfare of its employees. Ethical issues such as transparency, discrimination, harassment, disability issues, objective legal activities, conflict of interest issues and equal opportunity issues are of important consideration. The big challenge in many organization is usually to have the right number of people with right skills at right times? The process of human resource planning helps in this regard. The human resource planning process consists of activities relating to future demand for and supply of manpower and matching the two in the context of overall organisational plans and objectives. The process of HR strategy begins with analyzing the overall plans and objectives of organisation. The human resource plans stem from business plans. The demand for human resources in an organisation is subject to vary from time to time, depending upon both external and internal factors. INTRODUCTION Every organisation seeks to make its delivery better through making changes in the human resource department. The human resource remains a valuable asset to every corporate organization (Ulrich 2002). A quest to develop plans and policies that can make the department a success is the goal of every organization. There are various dynamics in the current world that act as major catalysts for these changes; technology, globalization, mobility and the changes in the business culture and ethics. To be able to surmount the challenges faced by the competitive business environment, businesses have come up with strategic human resource plans. The quality of an organisation is, to a large degree, considered merely the summation of the quality of people it hires and keeps. Therefore, before selecting the right people for right jobs, it becomes a prerequisite to decide on the quantity and quality of people required in the organisation. This is done through human resource planning (Kazmi and Ahmad 2001). Human Resource Management, thus, begins with Human Resource Planning (HRP). HRP is an avenue through which the organisation determines the current workforce as compared to the workforce required. It’s important for an organisation to carry out HRP inorder to achieve its objectives. The objectives can only be achieved when the manpower available is effectively audited and the numbers effectively analysed (Mathis et al 2003). HRP as an organizational process is compounded by this activities: 1. Forecasting: this has to do with laying down a future plan for the organization. One of the important principles is that every organization should be a going concern. This is only possible when the HR department makes a holistic forecast of its personnel availability and requirements. Forecasting will be very vital in making the foundation of a HR strategy. 2. Making an Inventory: this essentially means taking stock of the current workforce numbers, skills and qualification. 3. Anticipating: after a careful analysis of forecast and inventory, it is imperative to put considerations for risks and opportunities. This helps in coming up with an objective analysis of the quantity and quality of the workforce. 4. Planning: budgeting is a very important stage of every HR strategy. A holistic HR plan requires financing through which promotion and recruitment are made possible. NEED FOR AND IMPORTANCE OF HRP The need for human resource planning in organisation is seen in the light of the following reasons (Cain et al 2002): 1. Despite growing unemployment, there has been shortage of human resources with required skills, qualification and capabilities to carry on works. Hence the need for human resource planning. 2. Large number of employees who retire, die, leave organisations, or become incapacitated because of physical or mental ailments, need to be replaced by the new employees. Human resource planning ensures smooth supply of workers without interruption. 3. Human resource planning is also essential in the face of marked rise in workforce turnover which is unavoidable and even beneficial. Voluntary quits, discharges, marriages, promotions and seasonal fluctuations in business are the examples of factors leading to workforce turnover in organisations. These cause a constant ebb and flow in the work force in many organisations (Ulrich 2002). 4. Technological changes and globalisation usher in change in the methods of production and distribution of products and services and in management techniques. These changes may also require a change in the skills of employees, as well as change in the number of employees required. It is human resource planning that enables organisations to cope with such changes. 5. Human resource planning is also needed in order to meet the needs of expansion and diversification programmes of an organisation. 6. Human resource planning is needed to rationalize staff distribution in order to move staff from areas of surplus to areas of shortage. Then, in case of general surplus the situation can be made good by downsizing the work force. If there is general shortage then recruitment can be considered. HOW DO WE MAKE HRP EFFECTIVE? Torrington and Hall (2005) that the following steps should be taken to improve the effectiveness of human resources planning. 1. Human resource plans must be viewed as an integral part of corporate planning. That is, human resource plans should be tailored with the objectives, strategies and overall environment of the particular organisation. 2. The support and commitment of the top management be ensured before starting the process of human resource planning. 3. Personnel records must be complete, up-to-date and readily available to ensure an adequate and strong data-base. Data-base serves as backbone for human resource planning. 4. The time horizon of the human resource plan should be appropriate to accommodate the changing needs and circumstances of the particular organisation. 5. Both quantitative and qualitative aspects of human resource plans should be stressed in a balanced manner in order to avoid conflicts between the two. The following are issues that should be considering the formulation of a strategic plan of a company; the number of employees in an organization, the human resource environment of the business, quality and efficiency of the current employees, qualification of the human resource, skills of the current workforce, the need for recruitment and redundancy policies, empowering the staff and the remuneration schemes of the workforce (Truss and Gratton 2004). The ethical issues that should be considered include inter-alia the corporate integrity of the employees, compliance with the law, whistle blowing, sexual harassment, corruption, communication channels and protocol, discrimination, violation of privacy and client handling. MAIN BODY Before an organization engages in the journey of making a human resource strategy, there is a five factor approach the company should take into account. Most organization in making changes in the human resource department, do so with a view of making profit. What the company should however note is that every strategic planning is an expensive endeavour and the organization should be prepared to spend. This is made even more complex when the organization wishes to source a pool of labour from another country. The approach should be guided by setting the business goals, holistic human resource department analysis, gap analysis, setting the human resource department needs and the mode of evaluation of the progress (Ulrich 2002). a. Setting the business goals: goals of an organization are the main compass of the company. A company without goals is likely to clog in management crisis which would lead to decline of the company profitability. Similarly every department, including the human resource department, should come up with a clearly laid down plan of the goals. Goals are very essential since they determine the workforce ability and morale. A business cannot effectively start to transform and strategize on its future when the current trends have not been evaluated. Every company is required to have a vision and a mission that guide the company workforce. b. Workforce Analysis: this is a very important stage before strategizing. The workforce skills and qualification should be captured in the organization data. An organization with an under qualified workforce is likely to produce decimal financial results. Other key elements that the company should evaluate about its workforce are, age, competency, sex and experience. The organization should also conduct a prospective and retrospective analysis of the organization; an example would be conducting the labour turnover ratio. This is important since it helps in determining the migration levels and the employees’ satisfaction with the company. The workers are the wheels that make the clogs of an organization to turn, their evaluation is important since an efficient workforce would directly affect the company’s productivity and profitability levels. c. Gap Analysis: after conducting a workforce analysis it is imperative that the organization carries out the gap analysis. This is essential since it helps the company to address issues involving the needs, priorities and the workforce gap of the company. This is a rather cumbersome stage and would require a holistic organizational scan. This should be informed by the current trends is similar business and the need to establish better productivity and efficiency in an organization (Delery 2002). d. Setting the human resource needs and priorities- every company has different priorities with a competing one. The priorities of the company should act as benchmark that informs the strategizing of the company. An organization cannot make a comprehensive and efficient plan without first analyzing its needs and how well they can be addressed. Examples of company priorities could include issues to do with developing a competent team of workers, improving the departmental environment, restructuring the department, succession planning and staffing (Mathis et al 2003). e. Evaluation of the progress-in order to determine the future of the organization and give projection of its profitability evaluation is very vital. HR goals should be monitored and evaluated in a timely basis. The track performance of the organisation should be analysed with performance indicators in determining the success and the priority of an organization (Ellerman et al 2000). The presence of migration and mobility of the human resource is currently a great factor that determines the strategizing of the human resource plans and policies. Around the globe there are very many kind of movement and so are the reasons behind the migration of the people. Movement of the can be classified as either voluntary or forced. The voluntary category consist of people who move across the borders in search of work, to study or even in seeking to re-unite with their families. Forced movements on the other hand are involuntary and occur due to conflict issues like war and natural disasters. Socio-economic and gender are also influences that determine the movement of people (Mathis et al 2003). The ethical issues that the organization should address include the issue of non discrimination. Many organizations are known to practice nepotism and favourism in the recruitment stage. An organization that wishes to score well in the management should essentially distance itself from such kind of vices. Employees should be hired according to a laid down criteria and plan. Competency should be the recruitment criteria rather than the level of association with the managers and the organisation. The big obstacle is however trying to address the issue when we have an immigrant. Should the locals be offered opportunity than the foreigners? Such a question raises some ethical issues (Delery 2002). Another ethical issue concerns the organization reaction to sexual harassment. Every organization should have a sexual harassment policy that gives a framework on how it should address the victims of sexual harassment. A failure to address harassment may taint on the image of the company, and this may have effects that trickle down to affecting the organisation profitability and production (Torrington and Hall 2005). Another ethical issue in human resource strategy is conflict of interest. The organisation should ensure that the employees who have real interest in the company interest should not run the company affairs. This essentially affects the company corporate management if officials entrusted with the management are having undisclosed reasons in running the affairs of the company (Ulrich 2002). There is also a great need to establish a blue print through which employees should ventilate issues of whistle blowing and issues relating to privacy of information. There are instances that the employer can source for information regarding the employees without a formal communication. Such an engagement should be highly discouraged in an organization. Also a company that still has to grapple with issues of corruption should address these before engaging in embarking on human resource strategizing. Another ethical issue concerns the corporate image of the organization. There are instances where the persons mandated with the task of marketing an organization are rude to client or customers. This should be addressed before even developing a plan on human resource. The face of every organization is very important and every hostile employee that taints the image of an organization should be dealt with appropriately, some organization may have redundancy policies for such employees. Though none of the organization can be perfect, a bad picture of the company may affect its productivity levels. The image issue may be both negative and positive. A positive issue would be seen in the case of Xerox and Enron that would overestimate their profitability levels raising the investors’ confidence. As a result of Enron poor corporate governance the giant organization was brought to its knees. Marketing thus should be blend with transparency to promote good governance (Delery 2002). Another ethical issue relates to the disability and equal employment opportunities. Every organization should endeavour to promote the welfare of the marginalized groups of the society. No potential employee should be discriminated on the bases of their sex, race or colour. Ethnicity is without a shadow of doubt exercised in most organization. An organization that wishes to grow in bounds should establish itself as an equal opportunity employer. Physically disabled people should also not be discriminated against; a company should come up with a policy that ensures that their plight is well addressed in getting opportunities. Heated debates still continue to range concerning the issue of sexual orientation and recruitment. This is an ethical issue that a company should address in its long term strategic plan (Cain et al, 2002). Moreover the issue of compliance with laws raises an ethical issue. Most organization shows a general tendency to be non-compliant with the set rules, laws and regulation. Compliance may be expensive, but for every organization that seeks to have a long term strategy as regards the laws should be very compliant. Labour laws as regards health and safety and employment affect every organisation. The welfare of the employees should be promoted by ensuring legal compliance. There are also instances that organization is involved in activities that are illegal. The objectives of the organization should be very transparent. The organization should also comply with the tax laws not to rub shoulders with the legal enforcers. Apart from the ethical issues the following issues are very important in coming up with an organizational human resource strategic plan. In coming up with a HR strategy the company has to carry out the following pre-requisites, this gives a clear picture to the organization. a. The organization should analyse the major forces that negatively affect it. Inorder for an organization to remain competitive in a society that has variable trends, it should address issues of technology and better marketing strategies. Employee’s skills are complementary towards having optimum results. The gap should effectively address the gaps in its workforce at this stage. b. Development of a vision and mission. This sets a brief comprehensible way of communicating the objectives of the company. The employees must be able to identify and own up the mission statement. If this is correctly implemented then better results would result in a company. c. SWORT analysis. This is the third step in strategizing. It involves an effective analysis of the organization strengths, weaknesses, opportunities and threats. This should be demographical in nature and a feedback system should be established inorder to capture the data of all or majority of the employees. The company should work to take the advantages of its strengths and opportunities, while trying to tackle the issues of its threats and weaknesses. Having a better employee relationship platform would enhance this while making major external advertisements. With the coming up of PR firms, the organization should partner with like-minded firms to improve on the organization image. d. COP analysis-this is a comprehensive analysis of the organization culture, organization, people and systems. A holistic consideration of this components is essential in coming up with a blue print to guide the company strategy. With the technology development, the organization should ensure that the systems are up-to-date (Delery 2002). e. Critical employees issue determination- this essentially means with the information obtained in both COPS and SWOT analysis the organization can determine the specific issue that affect its HR. all the weaknesses identified should be crosschecked with the strengths of the organization. All issues at this stage including compensation, training, and supervision and planning should be analysed to determine their effectiveness and efficiency. f. Consequences and solution development- the organization must have possible solutions inorder to come up with an action plan. The consequences of the steps taken should be taken into account. The performance and success of the action plan will depend on the manpower planning. g. Implementation stage: this stage requires a holistic analysis of the performance appraisal and evaluation of the action plan. RECOMMENDATIONS The following issues ought to be taken into account while restructuring the HR strategy. Employment is an important issue to be considered, the procedures that relate to recruitment and selection should be smoothened. A good analysis of job description, transfers and promotions should be well secured in a good place in a long term strategy. The use of technology to enhance record keeping and confidentiality is an important step in making a HR strategy (Kazmi and Ahmand 2001). Another issue in attaining a HR strategic plan should be effective use of employee relations. This is facilitated by a displinary policy, dress code policy, communication rules and regulations, substance abuse policy, employee monitoring and surveillance, violence in the workplace policy and internal complaint mechanism. An efficient implementation of these ingredients ensures employee relations which are important in strategizing a HR plan. Another issue that should be addressed in the HR strategy is issues of compensation. A transparent payroll and job group should be maintained by a HR department. A clear record should be maintained by the HR department of salary payments, travel imbursements, time records, overtime payments and employee reimbursements. Inorder to motivate the employees the HR plan should include issues concerning vacation, study leave, sick leave, child care leave and parental leave. This is very important in ensuring performance and profitability. An inclusion of health insurance, life insurance, retirement plans and workers compensation benefits. In any organization movement can be vertical; promotion/demotion or horizontal; transfer/job rotation. Delery (2002) gives these reasons for employees’ movement within an organisation: 1. To improve the effectiveness of the employees to the organisation. 2. To satisfy both employee and organisational needs. 3. To provide for career and succession planning. 4. To effect changes in jobs and organisational structure. 5. To ensure discipline and make organisational rewards contingent on employee performance. Horizontal or vertical movement of employees within the organisation is called ‘internal mobility’. It takes the form of promotion, demotion, and transfer or job rotation. “Separation” is the term used for retirement, resignation, and termination. REFERENCES Cain, Niko H. & Brian H. Kleiner, 2002, How to Hire Employees Effectively, Management Research News, 25.5: 30-38. Delery, J.E. 2002. Issues of fit in strategic human resource management: Implications for research. Human Resource Management Review, vol. 8, no. 3, pp. 289-310. Ellerman, Jennifer S. & Brian H. Kleiner, 2000, How to Write Excellent Human Resource Policies, Management Research News, 23.7/8: 95-98. Kazmi, A. & Ahmad, F. 2001. Differing approaches to strategic human resource management. Journal of Management Research, vol. 1, no.3, pp. 133-140. Mathis, Robert L. & John H. Jackson, 2003, Human Resource Management, 10th edition, Cincinnati, OH, South-Western College Publishing. Torrington, D. & Hall, L.2005, Personnel Management: Human Resource Management in Action, Prentice-Hall, London. Truss, C. & Gratton, L. 2004. Strategic human resource management: A conceptual approach. International Journal of Human Resource Management, vol.5,no. 3, pp. 663-686. Ulrich, D. 2002. A new mandate for human resources. Harvard Business Review, vol.76, no.1, pp. 124-135. Read More