External Factors That Affect the Labour Profile of the University - Case Study Example

Table of Contents

Executive Summary3

Human Resource Planning4

Introduction4

Case Study Analysis4

External Factors that affect the labour profile of the University5

Legal economy6

Government and politics6

Customer’s tastes and preferences7

HR planning and better information7

Advantages and disadvantages of downsizing the staff numbers10

Advantages10

Disadvantages10

Recommendations12

Conclusion12

• Executive Summary

Change can be as a result of external sources such as technological advances, people preferences, economic, social and political pressures, or it can be as a result of internal factors. The effects of change can be experienced in one area or the entire organisation. Whether from internal or external factors, change involves the adoption of new processes, mindsets, behaviours, and practices. The purpose of this paper is to explain the role played by organisational change in any organisation and the effects this change can cause to the work environment. Intensive research was done where interviews were conducted and a review of literature on the topic of study conducted. The findings obtained showed that downsizing has major effects on the employees retained. The paper recommends that the institution should adopt different methods to motivate its employees and plan on preparedness for the future changes that may arise.

• Human Resource Planning
• Introduction

Organisational change is being experienced all over the world by every organisation and societies. People in the organisation will respond to change depending on the level of information they have about the change and how the change is presented to them. They can resist the change if they misunderstand it or if they do not agree with it. It is important to communicate a compelling and solid reason as to why there is a need to introduce change in the business (Drori, Meyer, & Hwang, 2006).

The paper involves a case study of a university whose employees activities had been disrupted by the dissatisfaction of the retained employees after downsizing its staff. From the case study, the vice chancellor of the university wants to assure the employees of a great future. However, he realises that there is much needed to improve the situation in the institution. As a result, he outsources skills and knowledge on how to change the situation and hence the initiation of this research. The paper outlines the internal and external factors that affect the institution in the case study.

Human resource management holds the key to the future success of every business that strives to meet its competitive challenges such as technology, globalisation, change capacity, and profitability (Ulrich, 2013). This paper seeks to explore the role of change in organisational structure and other challenges that are faced in managing dynamic organisations.

• Case Study Analysis

In 2010, Australian economy experienced a sharp fall in higher education students’ enrolments. This downturn was as a result of several macro factors. These factors included changes in regulations of the international student visa, an increase in Australian dollar value which made Australia be a more expensive destination for students, and increased competition from the Asian Countries, UK, and the US for international students. Policies in the funding of universities from the government also changed with the economic downturn. Universities are now funded depending on the student demand which is also changing. Most students are opting to do medicine and commerce- related courses and running away from Information Technology courses. The initiatives that were taken by the university human resource department to reduce the number of staff across the university did not yield the expected results. Downsizing was made to be voluntary where employees who are highly qualified and with intimate knowledge of the university and the processes carried out, left the university. The question of whether downsizing is an effective strategy for improving the performance of the organisation is never answered in a satisfactory manner (Tsai, & Yen, 2008). Voluntary redundancy left most of the retained employees with worries and insecurities over their jobs.

• External Factors that affect the labour profile of the University

To achieve the goal of every business, it is important that all employees be on board, and their behaviour and performance be aimed at improving the performance of the company. The strategy by HR underpins the strategy by the entire business (Bratton & Gold, 2012). However, every business can be affected by external factors from the outside environment. The management of the university should, therefore, be aware of such factors. The University in the case study is directly affected by the external changes that take place in the broader environment. These external factors pose great challenges to the university since it plans to have highly performing staff, especially because the competition for skilled and highly qualified workers between employers is rising. It is the role of the university to ensure that it retains the employees who are highly qualified and have the expertise and skills required. The external factors that affect the labour profile required by the University include:

• • Legal economy

When the legal economy of a country is doing well, the employment satisfaction will increase. When jobs are plentiful and the economy of the country is booming, employees from all over are happy as mirrored by their performance and behaviour. However, when the economy of the country is down, the level of employment will go down which will make the employees more fearful and anxious about sustaining their jobs. The anxiety causes them to perform poorly which ultimately affects the performance and sustainability of the organisation. Sustainability in organisations is one of the mainstream issues in business across corporations (Benn, Dunphy, & Griffiths, 2014). In this case study, legal economy is one of the macro-level factors that affect the university. Since the revenue of the country reduced greatly due to the reduction in incomes from the international students, the amount of funds given to the university by the government reduced, which made them reduce the number employees. This shows how the legal economy affects the labour profile of the university despite being an external factor. There is a need for change management experts to establish readiness for change in every organisation and provide recommendations for creating the change (Weiner, 2009).

• • Government and politics

The government affects most business through legislation, regulations, and government policies. The legislation is usually through laws such as equal employment opportunity law, tax law, social security legislation law, and labour law. In this case study, the university is affected by the government through the provision of funds. The University is funded by the government, which has declared that the funds will be provided according to the demand of students. The process will affect the university since it has not been receiving funds on such bases. Therefore, the university must consider the government in its human resource planning for the future.

• • Customer’s tastes and preferences

The main customers of a university are students. The university is still composed of international students who contribute greatly to the revenue of the university. From the case study, it is reported that the number of international students who enrolled in the school reduced in 2010. This means that they preferred other institutions of higher learning in other countries. Additionally, the enrolment of courses changed where the students who enroled in information technology courses declined with a large percentage. This shows that the preferences and tastes of the students affect the labour profile in the university. The number of staffs in some departments are more than expected and in some department, the staffs are few. For instance, since the number of students who enroled in medicine increased, the medicine department was understaffed. On the other hand, since the students who enroled for information technology reduced, the number of staff in the IT department were many than what was required. Organisational downsizing has effects on all or almost all the staffs of the organisation (Vahtera et al., 2005). The effects of downsizing, therefore, need to be analysed about the costs that arise from the retirement of staff from the company.

• HR planning and better information

Human resource systems have been known to contribute to the effectiveness of organisations (Datta, Guthrie, & Wright, 2005). Human resource planning is a continuous process in an organisation that is aimed at shaping the workforce to ensure that it can deliver the objectives of the organisation, currently and in the future. It also seeks to integrate the lifestyle and career goals of individual employees into those of the organisation. Human resource planning should not be carried out in isolation from the other management planning. The planning is most effective once it has been integrated into the organisational framework and the entire business planning cycle. Human resource planning should also be influenced by and reflected in the goals and values of the organisation. Human resource planning is mostly involved with analysing and identifying the need to have available human resources that are needed in meeting the objectives of the organisation. This process of human resource planning enables the organisation to ensure that it has the correct number of the right people at the right place, and at all the times. The team of employees in the organisation should have the necessary skills and capability to complete efficiently and effectively the tasks assigned to them by the organisation in line with its goals and vision.

Looking into the case study, the University Vice-chancellor knows that there is a need to invest more into the human resource planning of the university. Though he assures the employees that everything will be well, he knows that it will take a well-planned human resource to meet the needs of the organisation as well as those of the employees. The human resource is expected to provide information to the university decision makers who make decisions based on such information. The human resource manager must be keen in analysing the factors that affect the human resource as well as the best policy mix that can be used by the organisation to tap from the best of each and every employee. When engaging in the human resource planning of the university, human resource manager must put into consideration the culture of the organisation. Excellent and viable strategies can be negated by having a culture that is incomplete or misunderstood. Organisation culture can be defined as a pattern of values and beliefs that are shared and which give the organisation members meaning and rules of interaction. It aids in telling the organisation members how to behave.

Determining the HR needs of the organisation lies at the centre of the human resource planning. The main components of this process are identifying the demand for the employees and their supply. However, since effective human resource planning cannot take place without other structures, it must be integrated into the objectives and the goals of the university. For the human resource manager to allocate the employees to various positions and jobs, knowledge of the foreseen reductions or expansions in the technological and economic changes is required. The plans which are made include shifting employees within the university, laying off others, downsizing or cutting off others, or retraining the present members. Employee participation may or may not facilitate the implementation of changes in the organisation (Sverke et al., 2008).The process of human resource planning involves six basic phases. The phases include scanning the external environment for any change that can affect the labour profile, analysing the internal inventory of knowledge and skills of the labour force available and comparing them against the needs of the organisation, forecasting the demand and supply of the human resource, developing human resource objectives, making adjustments to workforce and evaluating the outcomes of the planning process.

Human resource planning will help the university to; identify the specific employee skills that the university is in need of and that are available, make maximum utilisation of the employees’ skills and aptitude, as well as improve the overall process of business planning.

• Advantages and disadvantages of downsizing the staff numbers
  • Advantages
• The main reason a company does downsize is to increase productivity (Post, 2011; Farrell, & Mavondo, 2005). The positive results of downsizing the staff in the university have not been highlighted in the case study. However, it is clear that any downsizing is done with an aim of improving performance. Though the effects of downsizing may turn out to be negative, the main purpose why downsizing is done is to increase productivity.
• Downsizing also leads to increase in profitability. When the level of productivity of the employees increases, the level of profitability must increase. This is because the profits of a company is directly proportional to the productivity of the employees. For instance, the marketing department of the university requires employees who are motivate by the company so that they sell the university in the best way possible.
  • Disadvantages
• Downsizing is one of the factors that affect job satisfaction negatively. Downsizing it is seen to have negative implications for the retained staff (Tutuncu, & Kozak, 2007). Though downsizing is a strategy that is usually aimed at bringing positive change in the efficiency of the organisation, it often leads to disastrous effects on the organisational staffs (Avey, Wernsing, & Luthans, 2008). After the downsizing in the university, the retained workforce was left unsatisfied and with a lot of questions. They were no longer assured of the security of their jobs. Their level of satisfaction is reported to have reduced. This calls for the university to work to restore the trust the employees had with them as well as to improve the level of job satisfaction the retained employees had. To retain a motivated workforce may not be a difficult matter. The managers only need to understand what causes employees dissatisfaction, satisfaction and respond to them accordingly.
• Their level of production is reported to have reduced ((Avey, Wernsing, & Luthans, 2008).

If the level of employees’ satisfaction reduces the level of their productivity must be affected. Employees only produce their best when they are put under the right working conditions. If any of this conditions is compromised, the employees are unable to give their best to their work.

Herzberg’s Two-Factor Theory of Motivation

The Herzberg’s Two-Factor Theory of Motivation can be used to guide organisations into motivating the retained workforce. This theory states that there are two set of factors that affect the satisfaction of employees in the workplace. Certain factors cause job satisfaction to the employees while a separate set of factors prevents job satisfaction. Managers in the university should eliminate any source of dissatisfaction for the employees. They should nurture good relationships between them and the employees. For them to be respected and trusted by employees, they have to administer the policies of the university with professionalism. The employees should also be compensated for the value of their effort. Compensations and wages should be used to motivate the employees. Providing a lifetime employment to employees makes them not to be worried about their future and the security of their job. This will increase their productivity to the university since they will concentrate on becoming more and more productive and competent.

• Recommendations

Employees work best when they are motivated. An organisation can adopt different methods to motivate its employees. These methods differ from one employer to another. Some of the methods of employees’ motivation that the institution should adopt include incentives, non-monetary rewards and promotions. The paper also recommends that the university should work on its preparedness to face the organisational changes that may arise. Employees should be trained on how to respond to certain types of emergencies.

• Conclusion

The assignment was based on a case study that described the impact of organisational change on the university activities. The paper sought to explore the role of change in organisational structure and other challenges that are faced in managing dynamic organisations. Change is inevitable in any organisation. Change in organisations can bring different results depending on how prepared the organisation is or how the responses to change are managed. It can be a great opportunity to some while to others; organisation change can be a time of disruption, loss, and threat. Since change is an inherent characteristic of any organisation, every organisation cannot escape it. An organisation is affected by both internal and external factors. These changes force the organisation to change. It is important that every organisation is prepared to respond to changes. Most of the people affected by the organisational change are the employees. Since organisational change will mostly affect the finances and the performance of the organisation, there will be a need to either increase or decrease the number of employees. In the case study, the university is affected by the external changes that occur in the broad environment. As described above, these changes include changes in the tastes and preferences of the customers, the legal economy, as well as government and politics. The planning function of the human resource in the organisation should, therefore, research widely on the external factors before making plans for the future. The remaining employees should be assured of the security of their jobs and be motivated to give their best performance.