Application of Classical and Human Resources Approaches at Woolworths Australia - Case Study Example

Student Name: Tutor: Title: Application of classical and human resource/relation approaches at Woolworths Australia. Course: Table of Contents Table of Contents 2 Executive Summary 3 Introduction and background 3 Human resource management at Woolworths 4 Classical approaches at Woolworths 7 Human relations approaches at Woolworths 10 Conclusion 14 References 15 Business Report Executive Summary This report explores the use of classical and human resource approaches at an organization that is based in Australia. Woolworths has been selected for this assignment considering the fact that it is one of its biggest employers in Australia. The introduction and background provides important information about Woolworths and justifies the choice for this assignment. The first part explores types of human resource management approaches and how they are applied at Woolworths. Both soft and hard human resource approaches have been explored within Woolworths. The next part looks at the classical approaches and how they have been applied at Woolworths. Important scholars like Henry Fayol and Max Weber have been explored with their concepts of scientific management and bureaucratic organization respectively. The last part explores human resource relations and how they have been applied at Woolworths. Under human resource relations Elton Mayo, McGregor, and Chester Barnard contributions have been explored. This report concludes with a conclusion recapping some of the main points discursions and gives a list of references used at the end. Introduction and background The organization that has been chosen for this assignment is Woolworth. Woolworths is one of the major private employers in Australia with a labour force of 191,000. The company opened its first stores in 1924 the retailer has opened thousands of supermarkets as well as operations providing liquor, general merchandise, consumer electronics, petrol, and home improvement. The core strategy of Woolworths is to attain sustainable growth is a market that is highly competitive and every changing online world. The management of the workforce that is effective has always been a strategy for the retailer (Daft & Danny, 2014). However, the inability to deal with gender imbalances through ranks was not seen as significant until in the last ten years. One major stumbling block was absence of definite rationale for action at the helm of the organization. This issue was addressed when human resource carried out a thorough data analysis around workforce planning and established that there were no enough leaders who were supporting the establishment of new stores across the business. Women department managers were not interested in moving through into store management roles in adequate numbers to meet the forecast growth needs of Woolworths. In the course of the last ten years upon appointment of a human resource director to team of senior management, there have been several changes in management aimed at creating a real meritocracy have eventually yielded results, especially for women employees. Important lessons have been learnt gradually (Bazley, Hancock & Robinson, 2014). Woolworths is ideal for this assignment since it provides an avenue to explore classical and human resource relations approaches. Human resource management at Woolworths Human resources management is the practice and science that concerns the kind of employment relationship and actions, decisions and issues that revolves around that relationship. It involves employer-formulated practices and policies that oversee the use and management of employees being a business resource in the overall strategy of the firm in order to enhance competitiveness and productivity. It describes the approach of the employer to personnel administration that focuses on employee involvement with the aim of motivating workers in order enhance their productivity (Robbins et al, 2014). There are two concepts to human resource management: soft and hard human resource management. Soft and hard human resource management points to dichotomous approach to the understanding of human resource management. Hard human resource management is calculative and tough and emphasizes on pivotal significance of integration between the human resource systems and policies with business requirements, it terms of strategies and activities. The soft Approach used human relations school that sought to involve teamwork, communications, and individual contributions integrating a wider number of stakeholders. These encompass the community and government apart from employees, shareholders, and managers (Daft & Danny, 2014). It is further entrenched into the entire ‘resource’ of employee for the purpose of achieving organizational goals. It focuses on knowledge worker and intellectual capital rather than manual or physical skills of the worker and calls for a more complex and sensitive management approach for human resources for exploiting full potential. On the other hand hard Human recourse management is exclusively concerned with the effective use of employees and focuses on the calculative, quantitative, and business strategic elements of head count resources management as just an economic factor. The interest of the organization prevails over those of individual workers. Both soft and hard human resource management approaches seek to exhaust the intellectually ability of the workers as opposed to focusing on their physical aspect of work. At Woolworths soft human resource management is practiced. The importance of the worker in contributing to achievement of organizational goals is not ignored. Share purchase plan for the employees at Woolworths gives them an opportunity to be shareholders in the company. Annual invitation allows participating employees to get Woolworths shares applying pre-tax as opposed to after-tax income (Graetz & Smith, 2009). In the year 2012, 16,107 employees acquired shares in the company. Equity in pay makes the workers to exert themselves since they understood they will be fairly compensated for their effort in the company. Outstanding performance is recognized in the divisional recognition programs at Woolworths. Peer nominations are used to recognize exemplary service (Robbins et al, 2014). There is a scholarship that is given to employees in recognition of innovation at Woolworths. The Jack Shewmaker Scholarship was introduced this year to honor a Woolworths’ consultant from Wal-Mart, Jack Shewmaker who passed on in 2011. Any innovation that involves development and implementation of a successful program, or idea within the business qualifies for the scholarship. The scholarship is worth $20,000 (Bazley, Hancock & Robinson, 2014). Other recognition schemes have been established at Woolworths like Paul Simons Awards that recognizes young people development at Woolworths. Human resource management is also analyzed in terms of employment and industrial relations perspectives through pluralism and Unitarianism. The Unitarian approach has the assumption of the existence of a common interest between employees and employers and attempt to enhance commitment from both (Russell, 2008). It is inclusive in the use of reward and communication systems but it is exclusivist when it discourages union membership. The pluralist concept acknowledges that employees and their employers will most likely encounter conflicts of interest that human resource management will need to deal with and resolve for the purpose of pursuing organizational goals. These two perspectives have offered a foundation for human resource research and largely demonstrate the advancement in industrial relation and management theory. Unitarian approach is used at Woolworths since reward and communication systems have been used to enhance interaction with the employees (Van Wart, 2008). The needs of the employees are fulfilled while the organizational goals and objectives of productivity, expansion and growth are achieved. There is a mutual interaction between the workers and the company and workers are involved in important decisions making. The focus groups were meant to analyze the satisfaction of the employees at the workplace and seek ways of enhancing motivation. Classical approaches at Woolworths This approach is entrenched in the scientific management theories of workers and work in the 20th century. Classical approach is also referred to as machine metaphor owing to the way employees were perceived as interchangeable parts. Fredrick Taylor is the famous as a proponent of the scientific approach to management. He explored production lines and came to the conclusion that work processes can be enhanced through application of scientific principles to workers and jobs (Robbins et al, 2014). These involves practices like designing a task with the goal of improving performance, recruiting workers with characteristics that match the job specification and further training workers and rewarding them for achieving productivity goals. Training and development as scientific management aspect has been emphasized at Woolworths. In 2010, Woolworths used up to $63 million in learning as well as development initiatives (Bazley, Hancock & Robinson, 2014). This included core training programmes, new employees training, and development of leadership programs for executives and managers. The equipping of workers with suitable skills to accomplish their task is important at Woolworths. Executive and management development is key to building leadership capacity for the future. The programs designed at Woolworths were meant to prepare the workforce for complex future roles for years to come (Daft & Danny, 2014). The leadership qualities of Woolworths were introduced via workshops which provided a clear and consistent understanding of the expected behavior in the company from employees. Close to two thousand leaders attended the workshop and their direct report have attained 360 degrees feedback concerning qualities. Promotion and work responsibilities are given according to the qualifications and competence of the employees hence ensuring high service delivery to the customers. Henri Fayol proposed that operational efficiency can be enhanced using better practices of management. He suggested five elements of managing and fourteen principles of administration. The five elements included organizing, planning, command, control, and coordination. Scientific management emphasize on the proper selection of workers. workers have to be trained to better deliver on the jobs assigned to them. Hierarchical authority is emphasized through delegation of duties. Fayol emphasized the need of a unit of command with the organization that gives instruction to the rest of the organization and delegate duties. The scientific management emphasizes the use of scientific method at the workplace in determining the best method for accomplishment of every task (Gabris, 2008 Scientific management proposes that workers have to be scientifically selected based on their qualifications and further trained to perform their duties or jobs optimally. Scientific management advocates for sincere cooperation between management and workers based on mutual self-interest. Management has to take fully responsibility in work planning and workers have the fundamental responsibility of implementing what the management has planned. Scientific management encourages pay for performance incentive plans using work standards use of fair performance standards. Operational efficiency at Woolworths is a priority as employees coordinate the daily functions assigned to them (Robbins et al, 2014). Hierarchical authority is respected at Woolworths as employees take their different roles in the company. Managers are involved in planning and employees carry put the plans in a bid to achieve organizational goals. Fayol also came up with the scalar chain that showed organizational hierarchy, and proposed that communication had to follow this chain for the purpose of reducing misunderstanding. However, in terms of emergency, he proposed that workers could communicate with one another across the organization. This concept of horizontal communication was referred to as Fayol’s bridge. Max Weber, a German sociologist came up with the theory of bureaucracy as a means of formally establishing structure of operations, authority, and communications in organizations (Russell, 2008). Max Weber identifies most large organizations as structured using the ideal-type bureaucratic model. Bureaucracy is described by Weber in terms of regulations and rules, division of labour, hierarchy of authority, and hiring/promotion depending on technical competence. Weber observed that the previous organizations were not efficiently managed and major decisions were made basing on loyalty and personal relationship with the worker. The authority of managers in the organization had not to be based on charisma but on the position which that manager occupied in the organizational hierarchy. Some important elements of this approach comprised of clear delineation of responsibilities and tasks, chain of command that is distinct having a centralized decision-making, and recording everything in order to avoid any misunderstanding. Bureaucratic management emphasizes on the organization form that is ideal. Bureaucracy present waste and inflexibility in the modern era but Weber not condone the excesses that are found in organization with bureaucratic structure today. Division labour is evidenced at Woolworths in the hierarchical positions held by different people according to their qualification and experience (Graetz & Smith, 2009). A flat structure of organization is preferred to fasten decisions making and delegation of duties. Center power is distributed to the different units within the organizations who are in charge of assistant managers and supervisors. Supervisors ensure the daily chores are accomplished without fail. Human relations approaches at Woolworths There are also human relations approaches are also used in management of employees in organizations. During the 1930s the focus changed from work tasks as well as their needs, and the studies carried out at Hawthorne instigated this movement. The studies were carried by the Western Electric Company based in Chicago. The studies showed the significance of human and groups’ relationship at the workplace (Parsch & Baughman, 2010). Elton Mayo and colleagues from Harvard colleges found out that those employees who worked within friendly teams; having supportive supervisors, tended to perform better that employees who worked in conditions that were less friendly. This and other related research was the foundation of human relation approach. Woolworths recognized the need for human resources approaches by addressing the needs of the workers. There has been a deliberate effort to show inclusivity through closing the gap between the non-indigenous and indigenous Australians in the workforce (Van Wart, 2008). Woolworth has to portray itself as competitive employer with no prejudice and inclination towards certain workers. At Woolworths there are positive relationships important stakeholder groups as well as community leaders. There is mutual respect among the workers, supervisors and managers. There is a deeper cultural understanding in the business and creation of suitable policies and protocol to support it. Generally there embracing diversity in the workplace at Woolworth. Elton Mayo recognized the need to address other needs of workers apart from pay and Woolworths has greatly responded to needs of its workers (Russell, 2008). Workers become motivated to outdo each other in giving back to the company. Promotion gives employees with lower ranks the hope of rising through the ranks red tape. Fresh leadership has been injected into the retail chain after acquisition of other companies. Opportunities for growth for employees have been expanded. Workers are recognized for their contribution to the retailer’s growth and profitability and appreciated (Graetz & Smith, 2009). Recognizing the employees for their input encourages them to work harder and gives them a sense of belonging. Incorporating the views of the employees in the decisions making process boosts the sense of belonging and self-esteem of the employees. A vibrant workforce that is highly motivated is an important ingredient in the winning formulae for any company that wants to thrive in a competitive and dynamic market. Training employees also motivate them to deliver better since they are fully equipped to tackle assignments given to them. For the purpose of reinforcing the significance of fresh food Woolworths has offered fresh training to its employees. The training involved 3000 workshops across Australia for more than 75,000 staff (Robbins et al, 2014). The training targeted in making workers more confidence as well as in-depth understanding of the fresh food offers and enhanced customer understanding. While it is important to achieve targets and goals set by various departments, it is of essence to motivate the workers and supervisors to attain them than using force or threats. Highly motivated employees deliver more for the company than intimidated workers with low self-esteem. Employees are fully engaged in the operations of the company and look forward to making their personal contribution. Woolworths continue to offer market competitive remuneration and benefits (Graetz & Smith, 2009). The remuneration structure comprises of fixed and variables, performance-based components that depends on the position of the employee. The objective of the reward benefit is to attract, retain, and motivate important talent within Woolworths. The objective is further to align to shareholder value creation as well as link to company human resource and financial strategy. Women at Woolworths are maintained at a flexible basis. Employees in the working group of management are keen on leadership qualities, engagement, and flexibility, apart from maternity leave. Woolworths has used focus groups to carry out in-depth analysis of its workforce in order to ensure the needs of the employees are met effectively. Flexibility for women has improved their performance. Some women were promoted while they were still on maternity leave. Motivation is key in retaining highly qualified employees. It makes sense to retain technically competent women who have a deep understanding of the organization and possess wonderful working relationships. The company was able to keep 100% executives who proceeded to maternity leave as opposed to losing 90% of them previously (Bazley, Hancock & Robinson, 2014). Promotion is a means of motivation that gives workers a sense of belonging in the organization. Woolworths provides a safe workplace for all employees. There is maintenance of high quality training and safety standards across supermarkets, offices and warehouses. There is a chance for career growth hence increased responsibility means better remuneration and other benefits. There are career opportunities at Woolworths. The chief managing director and chief executive officer of Woolworths has been at the company for more than 25 years and he started as an accountant in supermarket in Tasmania. The chief financial officer rose from being general manager corporate finance. Career growth at Woolworths is practical and workers start at the lowest ranks and grow to the highest level possible. Woolworths has expanded through growth and acquisition hence creating more career opportunities for its employees (Lowry, 2005). One of the important priorities at Woolworths is developing of young Australians’ skills. The supermarket group of Woolworths has the largest population of apprentices as well as trainees in Australia. The program for graduates for Woolworth provides employees with career opportunities in the course of their transition from college studies to full-time employment. Young Australians who have recently graduated are in their final year at college are eligible to apply (Robbins et al, 2014). Employees from in-store Woolworths have the chance to participate in this graduate program with the support offices being across a range of specialist areas like marketing and buying, IT, property and finance. Chester Barnard pointed out the organizational executives’ functions and their role in communication. He highlighted the significance of informal and formal communications to the success of the organization and postulated that cooperation among supervisors and workers was crucial to improvement of productivity. In his perspective, the main element to cooperation was communication (Robbins et al, 2014). The universal form of human cooperation is the most complex. Managers at Woolworths take a leading role in motivating and spearheading change in the organization. Leaders in management position provide guidance to workers within their departments. Woolworths has many Apprentice Butchers as compared to any other company in Australia. The period for completing apprenticeships is 3 to 4 years using a blend of on-job training within the stores and off-job training using local TAFE colleges. McGregor best highlighted principles of human relations organization using the theory Y and theory X. The approaches emphasized on the opposing assumptions that managers can hold for workers, as well as the corresponding managers’ behaviors. Theory X managers have the belief that employees lack motivation, are resistant to change and show indifference to organizational goals (Gabris, 2008). Managers have to provide forceful and strong leadership to control and direct employees. Managers with the theory Y perspective believe that employees are highly creative, motivated, and driven to satisfy their needs for achievement. The work of the managers it to bring out those tendencies using employee engagement in decision-making, management by problem-solving and objectives in work teams. Managers have to bring out the best from their employees. Woolworths applies theory Y in its management policy since it motivates its employees to perform without using force. Employees at Woolworth have a self-drive to perform and develop their careers to the next level (Cawthorne, 2010). Woolworths believe in empowering its customers in order to be more productive. A variety of incentive programs are designed in support of attracting, retaining and a performance culture. Store managers take part in in annual cash-based incentive plan with annual allocations. The part-term employees access the same general benefits as their full-time counterparts. Conclusion Classical and human resource approaches have been applied in organization since the 19th century and have evolved over time. Woolworth is company that started in 1924 and has grown expansively to be one of the largest employers in Australia. It has diversity in stores and provides opportunity for career growth to young Australians. Human relations approaches as well as classical approaches have been used in the management of the workforce and operations of the company to achieve efficiency and effectiveness. Employees at Woolworth are motivated through a variety of ways such competitive remuneration and benefits, promotion, scholarship for innovation and other reward schemes designed by the company. Various human relations and classical approaches are applied at Woolworths to management human resource. Incentives schemes are used to motivate employees to perform better. Theory Y is emphasized since every employee is responsible and wants to rise up through his career at the company. The organizational structure allows delegation of duties at centers of power is clearly defined. References Bazley, M. Hancock, P., & Robinson, R., 2014, Contemporary Accounting PDF, Cengage Learning Australia, Melbourne. 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