Tim Coffee Shop's Human Resource Management Practice - Case Study Example

MT299: Final Project Section # 01/01/2010 Joe Student Executive summary Tim’s business may be termed as successful one but requiring some adjustment to make it more successful. A little change on the management is required to bring the attention of the manager closer to the business environment and improve the planning and regulations, making the business run smoothly (Drucker, 2007). Most of the employees have no objectives of the business in their mind but working to keep time moving, this requires an adjustment in order to employ people who love the business with passion. There are notable weaknesses on the market which need to be addressed; additional advertising strategies and business promotion techniques need to be incorporated in the business. Though not all customers requirement are incorporated in the business, some comments like, efficient mode of payment, need to be critically analyzed as they indicate potential areas where an opportunity can be lost to another business. However, Tim’s business shows a strong financial position. Regulations and Management Summary Tim coffee shop should be taken as any other business whereby the owner is interested in making profit. With this perspective, the role of management should be properly demonstrated in this business. Regulation and management play a crucial part for any successful business since without them employees can live up to the expected business objectives and goals. For any long term survival of the business it is important that the business be managed in “responsible and ethical manner by considering the environmental issues, customer needs and employee needs” The manager should be competent with his/her work and preferably with a career related in business field. When we analyze Tim’s coffee shop, the manager seems to be doing a commendable job by outlining tasks to each respective employee and ensuring that each employee reports on time as well as performs his duty as required through their job cards this not enough. Additionally, good management has been in place to ensure that customers are served quality tea as required and the shop is kept clean it is not enough as the manager has failed in training the staff in customers of customer relations. The employees seems to be rude to customer’s which can be observed from customer’s marketing survey hence it is necessary that employees be trained on how to handle customer’s. The management also seems to have failed because there is a customer who is complaining of stinking plug hence she could not do the homework in the shop. The manager should have noticed that and put the proper correction measures. The management has failed in terms of administering rules and regulations. Employees do not strictly follow the rules as result of laxity on the management part. Once they make a mistake only warnings as given but no stern measures have been taken against them hence end up repeating the same mistakes as well as influencing others to make the same mistakes. Action items A good manager should be able to access the daily running of the business and make corrections where needed which imply that the manager should ensure that he or she performs daily checks on all the areas of coffee shop and put corrective measures where required. The manager also should be obliged to perform random checks on all the employees to ensure that they working according to set rules and any regulation and incase one violates this then his contract should terminated(Armstrong, 2006). Given the fact that several employees of Tim’s shop are university students there is need for the manager to implement strict business ethics and regulations. This is because students do not make the collage timetables and these timetables are subject to revision any time. In such a scenario an employee who may fail to turn up and this inconveniences the customer should be terminated from the work not as in the case where it has been observed that there is an employee who has received five warnings and still continue being in the business. While another employee is in his first year and has already received three warnings this actually tracking the business behind as well as shows some laxity in observation of regulations both by management as well as employees. HR Analysis Summary In any kind of business people consist of one of the most important resource but complicated to manage. The reason as to why people are important is because a business owner needs them to help in management and operation of the business. The complication in handling people arises because they are not machines and react or respond in unpredictable manner. Difficult in prediction is quite evident in Tim’s business from the comments made by the employees. From Tim’s coffee shop his employee seems not satisfied by their salaries hence end up under performing their duties, being rude to customers among other issues. Although, Tim has tried to motivate his employees, this does not seem to be effective as well as the system used in only favorable to particular employees only. Due to this fact this has created misunderstandings among the employees example is Maria Posada who has won the award eight times and this is negatively accepted by some employees. For instance Julio Rodriguez is not happy about the awarding, he says “nobody is going to get rich working for Tim, except for maybe Maria” such an employee may not work hard to achieve the best in the business due to the negative thoughts in her mind. Additionally, Tim’s employees lack required skills in hotel management industry as most of them possess high school education while other are pursuing their degree. Moreover, Tim’s employees are part time hence end up giving poor services to the customer’s. Need for Tim to employee a dedicated team of full time employees to his shop as well as trained in terms of customer relations. Action Items Tim need to hire a human resource manager who is able to understand the best employee, hire the right people, train, mentor and coach and develop them to contribute effectively in the business. Tim needs to have a business plan which includes HR strategic planning. Additional Employee motivations needs to be implemented as way of motivation employees to work more harder as well as serve customer’s with one hear and mind(Armstrong, 2006). Following the comments made by employees we see that majority of them came to business not for business purpose but because of other reasons. Phillips, for instance came to business because her friends were working there, Michelle on the other hands is leaving because her aim was to become a manager, a dream that is seemingly not achievable. A new team of employees which dedicated to work and achieve results should be recruited. This may include optimistic employees like Jeter who is hoping give Maria a run for the record in the monthly award. Moreover, Tim’s coffee shop seems to be employing mostly students with high school education or student’s currently undertaking a degree(Armstrong, 2006). These students do not possess the required skills as well as trainings in the hotel management industry therefore need for more qualified and trained employees who are able to give satisfactory services to the customer’s. Additionally, once the human resource department has recruited the employees it is necessary all the employees be trained on customer relations skills as well as on how they should handle customer’s to avoid incidences of any employee being rude to a customer. Marketing Analysis Tim has tried to advertise his business but most of his advertisements are within the shop. This may not help to in attraction more customers to the shop. He has used posters like ‘buy 10 mugs full of Tim coffee and get 1 free’ such an advertisement can only attract the attention of a group of customers instead of an individual customer. Action items One of the advertisements that can attract individual customer is the one about Jenna’s which are said to be delivered fresh every morning. Several of such advertisement should be put in place. The reason as to why advertisement targeting individual customer are emphasized is because, majority of the customers of this shop seems to be students; and rarely do student take their meals in group. It is also not common to get tourists in large group in the location of the shop. As a promotion to the business advertisement Tim need to add other posters displaying beautiful pictures of the products that he sell in her shop. Tim needs also to try the use of business card. This is because business cards are easy to make and distribute and can reach several customers. Since the customers are Tourists and students among other locals(Armstrong, 2006). Tim may promote his business through promotions’ that target couples. He should utilize the opportunity of having the coffee shop near the campus which has little competition from other business. He can gain other customers through introduction of new products and improving the existing products. For example some customers seem no to be happy with the coffee and this means that a variety of coffee that fit majority of customers should be prepared. Although many customers are happy about the price, quality products should be provided to protect customers who would be leaving the business to Queequeeg’s business which has relatively cheap products. The employees of Tim’s business are also threat to the business ; one of the customer complained that the morning employee was rude. For the student, time is a crucial factor which should be well planned for. Customers are complaining of the mode of payment which should be by cash only. This section need to be addressed because a potential business person may take an advantage of this weakness and establish a competing business that allow the use of credit cards hence diverting customers from Tim’s business; this would negatively affect the business ,and corrective measures should be taken before it is too late (Armstrong, 2006). Finance and Accounting/Financial Statements Financial statements are used to judge the performance of the business. From the financial statements of Tim’s Shop it is evident that the shop has a stable financial liquidity as well as profit. Though, this the case from the income statement one can judge that Tim’s total income is approximately $ 400,000, yet his salaries expenses is $ 101,600 which implies that salaries expense is almost a quarter of Tim’s total income. Moreover, for Tim to earn more income as make more profits it is necessary that he increases his customer’s capacity as well as cut down unnecessary expense. In order to cut down on salaries expense there is need for Tim to reduce his overall employees. In regards to the balance sheet the current assets are approximately $ 40,571.03 while the current liabilities are $ 4,746 which implies that the liquidity ratio of Tim’s shop is high given the fact that current assets are more than current liabilities. From this analysis one can easily gauge that Tim’s coffee shop is doing while financially as from his financial statements he is able to pay his long term and short term debts both in the short run and long run. Moreover, he is able to pay his debtors during short term from the profitability point of view. Though, this is the case it is necessary that Tim increases his current assets and reduce long term liabilities. When we analyze the balance sheet in relation to share holder’s equity it in which the coffee shop has a shareholder’s equity of $ 28,609.89 indicates that the coffee shop has a higher opportunity of generating cash internally (Chang, 2006). Since shareholder’s Equity is usually the net worth of a company as well as it represents the stockholder’s claim to business assets after all the creditors as well as debts have been paid it implies that Tim’s coffee shop is doing tremendously well in the industry as well as the Shop has sufficient capital to run its daily activities. It is necessary that Tim tailors his outlined goals and objectives towards his business performance primarily to achieve intended profit as well as minimize losses by cutting down unnecessary expenses. Problem Solving/Recommendations For Tim to achieve better result in the business, the following recommendations should be followed. Firstly, he should employ more full time employee and reduce part timer. This will give the employee a sense of belonging and become dedicated to business. The employee should be trained and equipped them with proper skills to handle and deal with customers. To make the business attract customers, more advertising and promotion of products should be done. The mode of payment should be extended to credit cards and above all the business environment should be made conducive for all customers. Additionally, Tim should cut down on his expenses especially salaries by reducing the number of employees. Moreover, proper rules and regulations policies should be implemented and each employee should strictly adhere to them with stern measures being undertaken on any employee who violates the outlined regulations. References Armstrong, M (2006). A handbook of human resource management practice.10th ed.Publisher: Kogan Drucker, P., F (2007).The Practice of Management.2nd ed.revised, reprint. Publisher: Butterworth-Heinemann Chang, J., F (2006).Business process management systems: strategy and implementation. Publisher: Auerbach Publications http://www.kaplanschoolofbusiness.com/MultimediaProjFiles/MT299Capstone_U/exterior_store front_.html Read More