Human Resource Management in Practice - Pizza Hut and Dominoes - Case Study Example

Human Resource Management in Practice By Professor Class University City Date of submission Human Resource Management in Practice Summary The report focused on the importance of having an effective Human Resource Management (HRM). Viewed as an important area in the managerial structure of any business or organization, HRM ensures maximization of the employees’ performance through well-designed strategic objectives. Primarily, HRM deals with the management of the people and ensuring their roles are in line with organization’s policy and systems. It is from such background that the report will be focusing on HR departments of Pizza Hut and Dominoes. Because the fast food industry is increasingly becoming important, the industry is experiencing rapid growth with stiff competition forcing others business entities to formulate their marketing strategies that meet the needs of the clients. However, most of the businesses fail to account for the crucial role played by the HR in ensuring an improved organizational performance. The report viewed Porter’s model in analyzing the performance of HR departments. Introduction During the past four decades, both Pizza Hut and Dominos have been able to build a reputation for excellence, which earned them the respect of the consumers and industry. Building the leading pizza company requires innovation, commitment to providing quality products, and dedication to the customer service and value. In addition, the entrepreneurial qualities, growth, and leadership are some of the factors that characterize both the businesses through the years of operation. Through focusing on the strength of cultural diversity, people, heritage, and franchisees, Pizza Hut has an objective of exploring the whole market niches (Warshaw, 2006, 177). The main HR role is to manage the available human resources; therefore, it is important to hire an HR with much on the performance of the employees. Both the fast foods use strategic human resources management (SHRM) which is a method of managing human resources and support the organizational long-term objectives and outcomes with the focus on the strategic framework. Moreover, it focuses on the longer-term people issue, matching institutional resources to the future needs, and the macro-concerns of the business relating to its structure, culture, values, and commitment. It is necessarily dependent on the evolving nature of the work. Every institution has its objectives, which require the setting of different targets. These set targets pass down the hierarchy depending on the nature of the business in question. Hence, to achieve the set goals, the managements often decide on implementing different strategies. Both the management and the employees know what the institution intends to achieve the set targets and the adopted strategies to achieve successfully these targets. Similarly, both Pizza Hut and Dominos also have different strategies in their various departments to ensure effective organizational performance. With the focus on the Pizza Hut, the restaurant support centres (RSC) which are then passed to the restaurant general manager (RGM) before finally reaching the employees set the targets (Nkomo, Fottler, & McAfee, 2000, 199). The HR plays a substantial part in guaranteeing that the employees understand the organizational objectives and set the strategies that would ensure all the employees contribute to the implementation process. HR Strategy in Transforming Organisations Every organization thrives well whenever there is a compelling alignment between organizational strategy and the context that the management tries to create for the employees. Therefore, the HR plays a crucial role in preparing the institution and strengthening such alignment, driving the strategic change, and encouraging efficient organizational performance. With the market becoming more competitive, the HR needs to be up to date with current information influencing the performance of the employees (Rothwell, Prescott, & Taylor, 2008, 119). Therefore, it is significant to utilize the latest global business insights and advanced knowledge in effecting the desired organizational change. In addition, the HR needs to have the knowledge and practice of optimizing the best practices using employee engagement, understanding the organizational culture, leading the changes, gaining the competitive advantage sing their knowledge, and aligning their performance strategies with the objectives of the business. The integration of human resource in the management of the business began back in the early 20th century when there was a need to document business value as a factor of workforce in an orderly manner. It initially had a role with the organization of recruiting, managing, and providing directions for the employees within the organization. However, the role of HR has been changing overtime from management to public relations creating a huge confusion among various organizations whose managerial structure do clearly outline the role of each department. Therefore, a well-established HRM system within the organization will ensure the positive and effective contribution to the workers’ productivity. In cases where the organization fails to recognize the value and importance of HRM, there is likely to be a failure, especially when trying to define the core value, mission, goals, and objective of the organization in question. Contrary to the traditional roles of the HRM, their duties have been shifting administration of personnel to strategic utilization of the workers. The expectation of the current HRM is to ensure the employed workforce yield measurable positive results for the organization. The impact of committed HRM should be noticeable. Moreover, for effective and efficient management of the workforce, HRM must practice planning techniques, directing, and coordinating all the administrative roles within the organization. To understand HRM, it is important to consider two approaches used to view the concept of HRM (Gilmore & Williams, 2009, 121). The approaches are soft and hard HRM. Hard HRM views human personnel as a way and breakthrough for attaining the organizational goals and objectives while soft HRM encourages workers to develop strategies and plans to acquire workers commitment. The hard approach focuses on work force as its planning tool through strategic alignment of human resources with business plans. Differently, soft HRM focuses on personnel relations. It also has an interest in the outcome of the workers while encouraging them to commit to the organization. Human Resource Strategy Used in Dominos Dominos has a management structure currently supported by the World Resource Centre to assist in managing different organizational departments including Marketing, Human Resource, and Franchise Development. Moreover, the fast company operates through opening different franchise stores in various locations with much focus on manufacturing and supplying the dough by the supply centres. Through its HR department, the company focused on employing efficient, effective, and reliable employees who better understand the business needs and act in accordance to ensuring that the business achieves such objectives. Moreover, the major focuses of the business are offering quality pizza and fast delivery. The major pillars that support its performance are the low-cost store designs, franchising, and integrating the supply chains (Armstrong & Armstrong, 2009, 217). Having the reliable and result oriented human resources, the company segmented its main markets through supplying expensive pizzas quickly as demanded by the potential clients. With the objective of being the leader in the online pizza booking and providing the deliveries, Dominos is currently integrating HR strategies that would guarantee the achievement of desired results. The leadership team focusses on the strategic decision-making process while the marketing division develops institutional brand. The E-commerce activities are becoming more challenging, which gives the HR difficulty in ensuring that the employed personnel understands clearly the issues influencing market performance. There are different HRM strategies. However, Dominos uses Hard HRM strategy that treats the employees as the resources of the business. Besides, employees are the most important organizational assets. There is a strong connection between the corporate business planning and the employees. Therefore, the institution has to consider the resources that require, methods of acquiring them, and the acquisition cost. The concept used by the business focus views the HR as the determinants of the desired workforce, conduct the recruiting, and manage the employees accordingly through hiring, moving, and firing them if they prove unfit for the available jobs. Every business that intends to achieve the desired growth and improved performance, it has to involve the employees at all the stages of managements in a bid to identify some of the areas that require improvement and intervention of the management. However, the strategy used by the HRM of Dominos encourages minimal communication since it is from top to down. That means that the management makes decisions without the involvement of the employees, which to some extent inhibits the management from viewing the urgent issues, which require intervention. The method also encourages redundancy since most of the changes in the number of employees take effect within a short period (De & Pearce, 2009, 242). With the market becoming more competitive and the demand for efficient and result oriented HRM continue to rise, the cost of hiring the HR is becoming very expensive. Therefore, the business embraces the pay enough to recruit and retain the staff method. The method encourages high payment for performing human resources as a method of encouraging uniform performance among the employees. In addition, it encourages little empowerment or delegation of duties and much emphasis on the appraisal systems in making the judgments that relate to the employees performance making it suit as an autocratic leadership style. Human Resource Strategy Used in Pizza Hut Different from the Dominos concept of HRM, the Department of Pizza Hut uses soft HRM strategy in ensuring the effectiveness of the organization. The method treats employees as the most important assets of fostering competitive advantage within the institution. With other competitors like the KFC and the McDonalds focusing on the product and price strategies in creating a better competitive advantage for their products, Pizza Hut mainly, invests resources in training and equipping its human resources as means of ensuring that they deliver the institutional requirements. In addition, the method encourages the involvement of the employees in the management issues (Brichieri-Colombi, 2009, 260). As a result, the concept treats them as individuals and integrates their needs while making business decisions. Soft HRM strategy concentrates on the needs, roles, rewards, and motivational issues of the employees to establish some of the factors influencing their performances. The strategic consideration is majorly on the longer-term planning, strong, and regular two-way communication since it gives the employees the opportunity to forward some of the issues influencing. In this case, the pay structure is highly competitive and is based on performance, with suitable performance-based related rewards like the profit share and share options for motivational aspects. The company also empowers the employees and encourages them to seek delegation and take the responsibility for some of their actions. Furthermore, the appraisal systems used to concentrate on identification and addressing both the training and development needs of different employees. The DHRM of the company uses the publications containing the salary data for different localities. The department and its LEAD (Leading Excellence And Development) Team partnered with the Infinitude Creative Group to emerge the winner of the Brandon Hall Group Silver Award. Of all the restaurant companies, Pizza Hut was the only one that won the within the category (Gilmore, 2005, 135). LEAD is one the most influential blended learning training programmes used within all the Pizza Hut outlets as it provides a consistent training experience for the employees while at the same time allowing them to work at their speed based on their personalized training plans. Role of HRM within the Institutions Consequently, HRM has a responsibility of ensuring proper communication among different departmental workers for sustainable and proper utilization of all the available resources. It is from this background they oversee recruiting exercise in consultation with the top executives. While practicing their role, it is important to have a strategic plan for accountability. Many organizations spend 50% to 75% of their total income workforce either directly or indirectly (Gale, 2012, 169). However, some organizations do not measure or manage these investments properly; thus, to ensure sustainability, the HRM has role of comprehensively understanding the contribution of the workforce to the strategic success of the organization. The concept of understanding the workforce should reflect in the workforce metrics. A well-formalized HRM department is significant especially when the role is employee oriented as this creates a productive workplace through engagement in the formulation of the business plans. Most HRM duties have been changing from time to time though some of their duties remain the same. Employing the best employee from the available pool of labor is the most evident and significant role. The employers are looking for the experienced workforce to cope with the escalating level of competition, thus, those seeking employment must display their talent and ability to the HRM. The success of the organization is a factor of employing experienced workforce. The HRM also monitors the culture of the organizations as it monitors all the employees’ relations. The HR has the role of defining the requirement of the organization through formulation of the strategic plan and policy and ensuring the employment of qualified personnel to ensure the success of the implementation process (Boroughs & Saunders, 2007, 29). The survival of most organizations has been grounded on constant Human Resource Development (HRD). Such trainings assist HR in having a global view of the workplace, workforce, and objectives. These cultures ensure the survival of organization in a sustainable manner as determined by the HRM. Through mission statement of different organizations, the HRM encourages most of its operations to be in line with the laid business ethics to ensure efficiency and satisfaction of the clients. The HRM has the overall management of the talents within the organizations, which is justifiable through their role in developing the management process, performing managerial duties, and establishing career paths. Besides those activities, the HRM also manages workforce associated with talents. This assists in bringing up new thoughts and effective practices into the organization with an aim of improving the performance. Additionally, the HR gives recommendation on the market-based salaries depending on the managerial position and duties performed (Pinstrup-Andersen & Watson, 2011, 211). It is the responsibility of HR of reviewing the salaries and allowances of the while considering the economic situation of the organization. For example, when the organization experiences tough financial moments, the HR may decide to reduce the number of employees or reduce the income earned per person to decrease the cost of running the organization. With the changing market demands and tastes of various clients, the HR has the responsibility of ensuring that the organizations’ activities are flexible enough to meet the requirement of the customers. For flexibility purposes, it is significant that the HR identifies potential workforce and recommend the training session to help the organization meet the standard of the clients. Since the HRM focuses on the management of the human personnel, it has to ensure that the working conditions of the employee are favorable and free from any harm or hazardous materials. In cases where the working conditions may pose threat to the human personnel, the HR has the responsibility of recommending the best package for the employee to take the job. The workforce can raise concern over the working condition to the HR as well for any improvement of relocation. Theoretical Perspective of HRM The market is becoming competitive that the HRM are focusing on the economic models and theories to determine the suitability of the employees before offering them employment. The commonly used strategy is the Michael Porter’s model. The theory originated from the industrial economics to form part of the classical perspective methods developed for many years. Moreover, the model bases concept on the competitive strategy using the five forces for assessing the attractiveness of the industry through which the corporate strategy can capitalize effectively on both the present and emerging opportunities within the market. Therefore, the model plays an important role considering it being an indispensable tool for analyzing critically both the structures and dynamics within the industry, which different organizations including Dominos and Pizza Hut pertain (Fogel, 2008, 272). The five forces tend to integrate the threat of the new entrants and the substitute products to the institution on the horizontal dimension while the vertical dimension involves suppliers and the customer bargaining power. However, both the dimensions tend to intersect on the fifth force that consists of the rivalry among different competitors operating within the same industry. The roles of the DHRM in both the companies have to integrate these forces while considering hiring the best employees. From the theoretical point, the level of profitability tends to increase with declining rate of competition. External forces like economic issues affect the supply and demand of products. As a result, the impacts of these economic elements influence the decisions made by the HRM over the labor force. Reduced demand for a product may affect the ability of the organization to pay salaries and continue offering some of the benefits to the employees. Economic situations determine the number of employees that an organization can retain or absorb within a given time leading to unemployment scenarios. Technology is another factor, which influences the decision made by the HRM while trying to improve the productivity and quality of goods and services offered by the organization. Technology also determines the quality of competitive advantage with an industry. Through the advancement in technology, jobs are becoming fewer and fewer due to the increasing use of Computer Aided Design and Computer Aided Manufacturing (CAD and CAM respectively). Many organizations are using the HR expertise to formulate new criteria for selection and training the workforce. The ever-changing legal requirements also alter the HRM working environment. Implementation Plan Dominos and Pizza Hut are great and fierce competitors within the contemporary cultured pizza business. Moreover, both have been competing for similar market niche. Therefore, both their markets enjoy similar demographic features making the comparison of these two businesses based on the level ground. In the modern markets, most potential clients take their pizzas seriously that they even die queuing for their fast food. Comparing the two fast foods, Pizza Hut remains the favorite for most people owing to the quality of their products and friendly prices courtesy of its HRM department that ensures the employment of result oriented and effective employees. Planning and the development of an effective HR strategy is important part of the HR process. Therefore, it is significant to develop all the HR processes and initiatives as the part of overall people strategy aligned with and designed majorly to help the businesses achieve their goals. A crucial part of the HR planning is to develop a workforce plan to attract, retain, and develop the staff needed to meet the present and future organizational needs. An effective implementation plan could be categorized into stage 1 and 2. Stage 1 of the implementation process mainly the short-term HR planning as competencies for supporting the Strategic Human Resources Planning. At this stage, the HR needs to have an establishment of the Competency Architecture or Dictionary that would assist support the strategy. Before profiling each group, the HR needs to define the roles and career streams that would assist in spearheading the identification of the current and future needs of the human resources (Society for Human Resource Management, 2011, 104). Furthermore, there is need for the HR to determine the method of integrating the identified competencies with the existing HR Planning process and systems including computer-based tools like the forecasting models Human Resource Information Management Systems. Stage 2 of the implementation involves revamping the HR tools and processes that would help incorporate various elements determined in Stage 1. However, the managers have to acquire some training to help facilitate the corporate HR Planning process. Moreover, it is important to monitor closely the implemented strategy to improve various institutional processes, tools, and systems that would assist in supporting HR planning. Conclusion There is a need for future HR leaders to think and act properly past the traditional boundaries of their roles, which encourages them to migrate from programs that focus on traditional way of suggesting ideas and encouraging new technological platforms. Moreover, they will need to address the factors influencing the definition and extraction of innovative culture through identification of periods when to encourage innovation within the organization. A shift from employment to personal value preposition to defines future HR’s roles when the employees are treated like customers considering them as products that can have a brand. If successful, employment value preposition may extend beyond employment as most customers will view employees as the organization’s extension. These practices might assist in improving the performance of Dominos and Pizza Hut. Embracing the reality of demands and mass customization ability will allow benefits from several choices. The evolutional challenge may result due to creation of from a suitable employment brand leading to a dilemma in the identification of the brand with the highest impact. Therefore, the future HR will have to acquire expertise in marketing tools and analysis of consumers’ behavior in a bid to solve these dilemmas. The most important mission will be to break HR’s traditional tendency of always preferring to standardization and similarity on the assumption that equal action is fair, hence, ‘‘sameness to segmentation.’’ References Armstrong, M., & Armstrong, M. 2009. Armstrong's handbook of human resource management practice. London: Kogan Page. Boroughs, A., & Saunders, J. 2007. Shared services the work for the business: Implementing shared service models that realize genuine business benefits. Strategic HR Review, 6(4), 28-31. Brichieri-Colombi, S. 2009. The world water crisis: The failures of resource management. London: I.B. Tauris. De, K. C., & Pearce, J. A. 2009. Strategy: A view from the top (an executive perspective). Upper Saddle River, NJ: Pearson/Prentice Hall. Fogel, M. 2008. 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