The Role of the Line Manager - Essay Example

? Exam Questions BY YOU YOUR SCHOOL INFO HERE Exam Questions Question Traditionally, the role of the line manager differs from the technical definition of the human resources manager role. The human resources model is about human skills development, flexibility, and gaining employee commitment through the development of a value system that assists in creating a unique, cultural corporate identity (Panayotopoulou and Papalexandris, 2004). Motivation is achieved through human resources efforts, supporting participation, autonomy and empowerment as well as personal career development. The role of HR manager is to align employee behaviours and job roles with strategic organisational goals to ensure high levels of employee performance and loyalty to the corporate identity. Line managers maintain the arduous role of ensuring that employees are achieving performance targets, focusing on proper planning, scheduling and generic supervision to ensure compliance to corporate policies. However, when line managers take on the role of providing HR assistance, they become much more psychologically involved with employees to improve their dedication and motivation. Consider an organisation with a structured production system governed by traditional line management. In the role of HR provider, the line manager goes beyond the work schedule and efficiency measurement, becoming a strategic partner with the human resources division to create value rather than merely productivity. Research in human resources identifies that employee empowerment is one of the most fundamental methods of gaining their commitment and motivation. Empowerment strategies give employees more flexibility in taking active roles in corporate decision-making, thus giving employees a perception of control and prestige within the organisation. According to Yusoff (2008) when employees are granted more authority, it becomes easier in the long-run to ensure discipline and control. Line managers have the most frequent contact with employees and thus act as the intermediary for team development. Line management has more intimate knowledge of employees’ attitudes, lifestyle preferences and skills capabilities than that of the HR manager due to their close proximity in the production (or non-production) environments. This gives line managers a unique ability to utilise many different HR theories to ensure that they become more like coaches or mentors than simply authoritative line managers to assist in developing employees’ core competencies. For instance, in a production environment, there is a constant demand for change. Change comes in the form of new technology implementation or systems process restructuring in order to meet cost or strategic-based performance or output goals. The line manager acting as an HR facilitator can become more active in training provision, giving employees hands-on tacit knowledge that can be transferred for better organisational learning and knowledge exchange. According to Bambacas and Bordia (2009, p.225) when training is provided that is perceived as being non-transferrable to another business, it becomes too costly for the employee to leave in pursuit of different employment. Traditionally, the HR manager handles the process of developing and implementing training packages. However, when involving the line manager, the management team can provide a distinctly different element to ensuring employees have the knowledge and skills to accept and embrace changes in the work environment. Line managers hold intimate knowledge of the systems that drive organisational productivity and can thus take this self-contained, tacit knowledge and disseminate it directly through concrete and applied training; something not achievable with the HR manager who is not personally familiar with operational systems. The line manager empowers employees, establishing a sense of group belonging in the team, constantly reinforcing that uniqueness of the training packages to gain a psychological advantage over employees. By using both line management techniques, HR strategies and some dimensions of coaching, the line manager is able to reinforce that non-transferability of this new training. The outcomes of this are improved motivation by expressing the corporate commitment to career and skills development, and also a reduction of turnover ratios that saves costs of labour and also meets strategic goals for human capital development as a competitive advantage in the industry. The line manager becomes both a change agent and a resource for employee support, further enhancing relationships by offering opportunities for empowered feedback and innovation. It is not just training where the line manager can assist in HR deliverables, they can take this coaching and mentoring role into areas of helping to set bonuses and determine promotional opportunities for specific high-performing employees. In much HR literature, there is discussion about setting tangible rewards for high achievers as a means to boost motivation and long-term commitment to meeting organisational goals. Rather than having these factors solely dictated by HR managers, the line manager can use their informal knowledge of employee attitudes and strengths to establish a viable rewards system. Whether the organisation is governed by transformational management or more authoritarian, controlling systems, having more visibility in establishing rewards for performance can give the line manager more credibility as a role model and as an advocate for ensuring that employee needs are met properly. Rather than simply submitting yearly performance analyses to HR, the line manager can participate in 360 degree feedback systems to give more accurate assessments of employee behaviours and competencies. They can also survey employees about the work conditions and then discuss these findings with employees to establish quality relationships and, again, reinforce corporate commitment to sustaining employee needs. Usually, these activities, when present, are performed by HR managers that are not necessarily familiar with the intricacies of employee behaviours individually or as a team. Since the HR model is about flexibility, as described by Panayotopoulou and Papalexandris (2004), the line manager tries to facilitate process changes or governance changes based on feedback, thus acting as a respected change agent whilst also building a perception of team association with those under his or her supervision. Further, since there are many different social and cultural differences when working with diverse team members, facilitating open, empowered discussion improves the quality of team function and will provide superior outputs. Proactive consultation, usually handled by HR, ensures conflict reduction and more long-term productivity that ultimately leads to higher productivity and cost savings. Mentoring and coaching for career development simply builds a stronger team willing to work together effectively. Question 2 Operations management is best defined as “the management of systems or processes that create goods and/or provide services” (Jinkens and Yallapragada, 2010: 122). Operations managers must consider all elements of the supply chain, marketing, inventory management, cost control, training, production scheduling and control, and often serve as an intermediary for accounting recognition in key areas of operations. Operations managers are integral in establishing budget-conscious procurement and developing the scheduling necessary to ensure adequate supply of raw materials needed to create a product or service. This role might even have a negotiating responsibility to establish vendor pricing on contracts for efficient supply system development; a type of overseer related to vendor relationships that recognise the accounting and expenditure needs of the organisation. Operations managers ensure that employees, whether production, purchasing, facilities management or customer service, are aligned to meet corporate strategic goals. Operations managers accomplish this through proper scheduling development and also ensuring that proper training is provided for all areas of job roles that impact operations and final product/service delivery. Operations mangers establish many different varieties of quality control systems that measure productivity, costs and efficiency to maximize outputs. Operations managers are concerned with the invariable linkages between cost management and cost leadership as it relates to the aforementioned areas under their jurisdiction. Operations managers are concerned with the cost of goods sold versus sales volumes for profit recognition, how to maximize total return on investment for many different operational areas, and also the importance of organisational assets (i.e. facility, human capital, or cash flow) to meeting strategic goals for profit and competitive advantages. Financial ratio measurement is consistently linked with the operational role (Jinkens and Yallapragada, 2010). The operations manager must also have a recognition of costs, thus often they will operate in lean production systems as a means to control expenditures. Under most definitions, the lean environment is one where production is streamlined, inventory management occurs to avoid excess stock levels, and the supply chain constantly under quality monitoring to identify new opportunities for cost savings and price reductions with vendors. It is “a system that uses minimal amounts of resources to produce a high volume of high quality goods” (Stevenson, 2009: 28). The goal of the operations manager in this type of environment is to transform inputs into quality outputs with either minimal expenditures or improving the systems that drive production, procurement and distribution of product along the supply/value chain. The operations manager is also heavily involved in advertising, distribution networking, and promotions as it relates to the marketing function. Thus, operations managers are active in conducting field work about consumption behaviours and social/cultural attitudes of buyers to develop more effective methods of gaining consumer attention for improving sales volumes. This role is then linked with the external environment heavily as it relates to revenue production and how to differentiate the business’ products and services from that of competition. They conduct analyses of the competitive forces that take away market share and then develop counter strategies through promotion and advertising to outperform competitors in their industry. Having identified the nature of operations management, there are fundamental aspects of the job role that will impact operations management success or failure. These dimensions are volume, variety, variation, and visibility. Volume essentially deals with the tangible amount of product or services needed to satisfy customers that will be produced by the organisation. Variety considers the entire product line of the business or the level to which innovations are required to enhance and improve existing products. Variation is about consumer demand for the products and services that will change over time. Visibility is about how operations are linked with the external customer, often involving the marketing function and external analysis of consumption demand and consumer behaviour. Variety demands that a business be flexible to match products and services directly with customer needs (McDonald, 2009). For example, a company that produces technologies will have limited life cycles for certain consumer lifestyle products, thus the operations manager must constantly examine how to build better supplier contacts for new raw material procurement or train staff capable of embracing change innovations. Variety requires quality assurance processes and change management principles. Visibility often requires adjustment of advertising based on changing social demands. Again, for a technology provider, this might involve conducting market research about how particular technologies are used and then investing more financial resources in advertising as a competitive tool (i.e. conducting surveys or questionnaires with consumer target groups). Variation can improve operational success as sometimes demand patterns shift with seasonality or even consumer social trend changes. Basic analysis of financial data (ratios) can improve capacity planning as a means to optimise costs associated with turnover. Finally, analysis of volume can assist in structuring production so that there is a lower unit cost or improving expenditures in fixed overheads such as facility rental or changing production labour and systems. Strategic goals for profitability might also exceed current sales volume, thus the operations manager must conduct analyses of current capacity and staff competency to determine whether new products can be introduced as a means to improve financial profitability. By assessing capacity, labour shortages can be filled or excess employees removed for cost savings due to either high volume needs or low volume needs; respectively. The operations manager conducts routine quality assurance testing, through such tools as the balanced scorecard or improved managerial visibility to ensure that the four v’s are maximized as it is linked with strategic goals and corporate ambitions. Volume changes are often driven by changing consumer demand or through innovative marketing tools that continue to erode market share from competitors, thus improving visibility. These four v’s are inter-dependent and the role of operations management is complex as their assessment of these factors will influence procurement, distribution, advertising, promotion, and systems implementation as it relates directly with production and inventory management needs. Question 3 It has been offered that marketing is about giving people what they want. To what level does this statement meet with agreement as it relates to tangible capacity of a business, profit goals, and also restrictions on success that are directly imposed by changing customer demands and needs? It is ultimately the goal of a successful, market-oriented company to work diligently to establish products and services that will give customers what they are looking for. However, there are many operational, staff-related, and resource restrictions that can impede making this a routine reality. There are many different factors that will determine whether an organisation can provide customers with exactly what they are looking for. For instance, a business may have a unique product with little or no competition (an oligopoly or monopolistic organisation), thus giving the organisation considerable opportunities for exploiting high pricing structures for larger profit. In this case, the business would not have to invest as heavily in marketing when there is a concentrated demand for a particular product. In this case, the organisation maintains considerable leverage over the customer, being able to control factors such as timelines for distribution and retail replenishment or, again, establishment of a premium pricing model. A product produced in this type of market structure, with little to no competition, will usually be subject to very high consumer demand levels. Companies such as Apple or Microsoft exploit these leveraging abilities to use marketing to create a buzz about upcoming releases of innovative products. Rather than using distribution or concentrated lifestyle advertising to give consumers what they are looking for, these company leaders use psychology and their ability to raise the social consciousness about the products and services to increase demand. Thus, in this type of industry, marketing is not about giving people what they want, the ability to create cultural awareness (actually creating demand) is accomplished through visibility that is strategically timed with internal capacity for delivery of final product. When the product is innovative and sold in a market with limited competition, the product itself gives customers what they want and there is no need for reliance on marketing to accomplish this task. “Consumers buy Apple products purely on the strength of the brand” (Jones, 2007: 18). In a different industry where this is much competition, then it can be said that marketing should be the focus of ensuring that customers get what they want. Consider a foods producer, such as Coca-Cola, which competes with PepsiCo and many other food producers. Pepsi gains market attention using celebrity endorsements to project the image of hip and trendy business (Reppo and Yan, 2010). Customers do not necessarily want these endorsements, however the marketing is used to give the business more visibility as it relates to consumer lifestyle. In this case, the product has not changed, only a psychologically-based effort occurs to create relationship. Customers believe they are getting what they want through the process of promotion, thus innovation in advertising accomplishes giving customers their demands. If a business fails to recognise that changing cultural demands related to diet are impacting demand volumes, sales losses are likely to occur. According to Keegan and Green (2008), cultural preferences have significant impact on sales volumes with foods manufacturers or other industries that provide lifestyle-based products and services. When there are other product brands offering similar products on the market, customers have more leverage and buyer control, thus they can exert their dissatisfaction by defecting to a competing product that has a better price or better lifestyle enhancements available. In this case where buyers have more leverage, then marketing should absolutely be about giving people what they want. Why? This means that the producer must ensure timely replenishment of stock, establish an affordable or accepted consumer price tag for the products and services, and also ensure that the product maintains the tangible benefits needed to avoid defection to competing product brands. Though it might require readjustment of internal processes and systems to provide innovative products or those with competitive edge to meet demand volumes, it is necessary to give customers what they want to ensure sales meet strategic expectations and ensure business longevity. This will require adjustment of distribution networks for more timely delivery of product as part of the marketing function, again, to ensure that customers are not choosing competing products for their ability to provide more effective and worthwhile products. In terms of price in the marketing function, certain environmental situations drive a need for customers to have affordability when making their product selections. The cost of goods sold, for some businesses, might not afford the ability to attain a high profit. Thus, the cost of the final product must be passed onto consumers. When considering the marketing function as it pertains to pricing, a business cannot always give customers what they want when it comes to affordability. High labour demands, sophisticated technologies, or cost of distribution to domestic or international locations could complicate establishing a price that customers are demanding. Thus, marketing is not always about giving customers what they want when business longevity, in order to service product needs for the consuming audience, conflicts with recapturing the cost of goods sold. A business should want to provide marketing that gives customers what they want, however as identified that are real-time business scenarios that make this impossible or next to impossible in every industry and every situation. A business must understand its operational constraints and the nature of the competitive environment before it can be established that marketing should always provide exactly what the customer is looking for. The volume of competition, along with real-life business costs associated with product manufacture and distribution, as well as capacity to produce are more fundamental in giving customers what they want and not necessarily related to marketing. Marketing is often the catalyst for changing perceptions of consuming audiences, but does not necessarily provide fulfilment to customers in the same capacity that product manages this effort. When feasible and when environmental and internal scenarios allow, then it should be said that marketing should be focused on giving customers what they want especially surrounding distribution and pricing. Question 4 Traditional budgeting has been the product of much dissatisfaction with managers. This is due, largely, to the fact that traditional budgeting does not manage to encompass the whole of the organisation and its cost needs and does not provide for much flexibility when change is necessary to meet customer demand and alter volume of production. It is considered an “obstacle to progress” and fails to meet with market demands as they fluctuate over time (Daum, 2002: 1). Traditional budgets are generally produced on an annual basis, thus making projections about the types of expenses that a particular division (or the organisation as a whole) will incur during the year. For instance, the budget might include procurement, inventory, labour, and production as the business currently exists without taking into consideration the importance of the external environment to making changes to these systems. For example, an organisation might discover a need for sophisticated technology implementation in order to compete more effectively, thus a budget produced six months earlier without knowledge of changing environmental conditions would be largely ineffective as it relates to maintaining a market orientation. The external environment, related to competitive forces and changing consumer demand, has a direct influence in changes that occur within the organisation. A traditional budget, as one example, might allow for ?2 million for the entire production division, with line managers expected to operate within these cost parameters. Assume for a moment that this budget was created in January at the start of the fiscal year, running through December. However, in June, there is a sudden spike in sales volumes due to high acceptance of a new innovation or simply lifestyle and attitude changes from the buyers. In this case, in order to ensure volume quantity to avoid defection of consumers to another brand, the business must hire more employees and increase output expectations for the rest of the year. In this situation, the traditional budget would forbid exceeding ?2 million, thus limiting capacity and the ability to devote more investment into recruitment and training. Budgets require flexibility, especially true in larger organisations with high volume outputs or multi-national presence in which the organisation is operating with many different divisions necessary to achieve quality customer service and replenishment of retail product. When the business needs to procure new assets to improve production outputs that are solely driven by environmental conditions, traditional budgeting just does not work in an industry where change is constant and demand levels are difficult to predict. Unless senior-level executive leadership provides the ability for a budget to be dismissed in favour of immediate process or output changes to volume, the business will be unable to maintain its market orientation and satisfy its buyer audience. This is why better budgeting and beyond budgeting have been presented by certain theorists to assist in providing better flexibility and market responsiveness. It was already established that one operational concern is visibility and a business might discover during the year that it needs to invest more resources into advertising due to sales declines and to maintain the ability to compete effectively. If only a marginal amount is predicted for advertising, whether based on solid historical sales figures or simply corporate cost-cutting, the business will be unable to establish higher consumer visibility and provide the promotional materials needed to gain more buyer interest for profit improvement when the budget denies higher advertising expenditures. Better budgeting “asks for a concentration on important and sensitive parts of the organisation and a significant reduction in detail and complexity of the object of planning” (Weber and Stefan, 2005: 23). Better budgeting provides the flexibility needed to respond to changing market conditions by eliminating certain areas from the main budget and trying to create some level of autonomy with key divisions that contribute to sales and profit success. For example, rather than indicating that the whole of production is limited to ?2 million annually, better budgeting would segment certain production areas, such as procurement or information systems, allowing each division to assess their real-time expense needs as they occur with changing market conditions. By giving these regions more autonomy and not limiting, a business can better respond when change is necessary to achieve volume, visibility, or improve brand reputation. Beyond budgeting essentially calls for an elimination of budgets (Hope and Fraser, 2000). Better budgeting provides self-governance of key areas, empowered managers, and the ability to network an organisation for better planning and control of costs (de Waal, 2005). Beyond budgeting creates independent and self-managing business divisions that have the ability to deliver value to customers through rapid responses to maintain market orientation. For example, the empowered managers of each division would be able to allow expenditures at their personal discretion and thus are given authority to work outside of a traditional, pre-planned budget. By subdividing the organisation into units and then networking them together with managers given the authority to control costs, there is individual accountability with each division when expenses overrun expectations or rewards when costs are controlled but each unit manages to achieve their market-oriented goals. Beyond budgeting provides much less restriction on expenses, so long as there is ample evidence that the division must make purchases or spend in order to improve the long-term profit position of the business. For instance, procurement might recognise that changing raw material needs are necessary throughout the year to provide better product. Marketing divisions might be forced to use celebrity endorsements to gain market attention and outperform competition using these strategies, thus more expenses are required in the hopes of offsetting high celebrity payments with higher sales volumes. Better budgeting and beyond budgeting provide the ability for an organisation to be adaptable to changing demand patterns and also be responsive to outperforming competitive actions. There is always the risk of new entrants in a certain industry and sudden high sales performance of a new competitor could radically change needs within the business. By eliminating tightly-controlled annual, traditional budgets a business can respond better. References Bambacas, M. and Bordia, P. (2009) Predicting different components: the relative effects of how career development HRM practices are perceived, Journal of Management and Organization 15(2), 224-241. Daum, J.H. (2002) Beyond budgeting: a model for performance management and controlling in the 21st century, Controlling and Finance, July. [internet] Available at: http://www.juergendaum.de/articles/beyond_budgeting.en.pdf [accessed 26 December 2011] de Waal, A. (2005) Is your organisation ready for beyond budgeting?, Measuring Business Excellence 9(2), 56-67. Hope, J. and Fraser, R. (2000) Beyond budgeting, Strategic Finance, vol. 82, 30-35. Jinkens, R. and Yallapragada, R. (2010) Cost accounting in auto manufacturing companies in Germany and the United States, The International Business & Economics Research Journal 9(3), 121-127. Jones, G. (2007) First and foremost, it’s Apple, Marketing, London. 11 July, 18. Keegan, W.J. and Green, M.C. (2008) Global Marketing, 5th ed. Pearson Prentice Hall. McDonald, I. 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