Analysis and Recommendations for the Resolution of Operational Problems at EMPLOI - Essay Example

Analysis and Recommendations for the Resolution of Operational Problems at EMPLOI EMPLOI is a recruitment and staffing service provider which was acquired by its current owners three years ago. Despite high demand for the services that the company provides, the new owners have not been able to recover any portion of their initial investments. However, revenues and profits currently generated are sufficient to sustain operations. This paper takes a look at the current business operations of EMPLOI and investigates causes for its mediocre performance as a business. Operational problems within EMPLOI are identified and recommendations to correct the problems and improve EMPLOI’s business prospects are presented. Table of Contents Introduction 4 Current Business Structure and Operations 4 Operational Problems Identified 6 Recommendations and Action Plan 7 Summary 11 Introduction EMPLOI or Employment Opportunities, Inc. is a staffing service provider established 13 years ago. Upon inception, it specialized in providing temporary staff for office related positions such as office clerks, data encoders and administrative personnel. Three years ago, the company was sold to its new owners. Although EMPLOI has been operating with sufficient profits to sustain operations for the last 3 years, the new owners have not yet been able to recover their initial investment when they acquired the company. The current CEO believes that strategic actions need to be undertaken to solve operational problems in order to increase revenues thereby increasing profits from operations so that the owner’s initial investments can slowly be recovered. Moreover, aside from deployment of office staff, the CEO believes that diversifying into the blue collar worker market is an opportunity that EMPLOI should explore as there is huge demand for this type of workers. This paper takes a look at the operations of EMPLOI, identifies problems and recommends solutions to those problems. Current Business Structure and Operations Currently, EMPLOI has nine full-time people handling its administrative operations organized according to the chart in Figure 1. Figure 1. EMPLOI Organizational Structure Because of her Marketing background, the Admin & Operations Manager is also the Marketing Section Head. She is responsible for the day-to-day operations of EMPLOI as well as prospecting for new clients together with the Business Development Officer. The HR & Admin Section Head is responsible for recruitment of personnel for the company’s manpower pool as well as for deployment to client companies. She is also responsible for internal HR & administrative functions for the EMPLOI office. The Accounting Section Head is responsible for payroll for all deployed personnel as well as the company’s business accounting requirements. The major operating processes of EMPLOI today are servicing the requirements of existing clients, recruiting personnel to serve client requirements, processing of recruits for deployment, handling HR concerns of deployed personnel including payroll and benefits, and administrative requirements of the EMPLOI office for its 9 full-time employees. At the start of the week, the Admin & Operations Manager conducts an informal operations meeting wherein she gives instructions to her staff for the rest of the week as well as resolve staff concerns. On a day-to-day basis, the Marketing Section goes out prospecting for new clients, the Recruitment Specialist goes out to find new recruits and processes these recruits in the office. It is also important to note that the Accounting Section manually processes three sets of bi-monthly payroll each month. This procedure is a holdover from previous management’s practice which had given way to payroll schedules of big clients. The HR & Admin Section maintains information files for all recruits whether deployed or not. Resumes and other personnel documents are stored in hardcopy form in folders which are filed alphabetically by name in filing cabinets. Currently, there are 300 folders in the deployed file and 500 folders in the manpower pool. Periodically, the Recruitment Specialist produces summary lists of recruits in the manpower pool, organized by major skill qualification to aid her in hunting for the proper recruit to deploy when client requests come in. On a monthly basis, the Admin & Operations Manager and the Accounting Section Head meets with the CEO during the company managers’ meeting for all of the CEO’s companies. For this meeting, EMPLOI produces a monthly operations status report which contains deployment details for the month along with billed amounts per client; administrative expenses for the month; and operations activities undertaken. Currently, the only operations target which the CEO has set is for EMPLOI to increase the number of deployed staff from 300 to 1,000 over a 6-month period. Operational Problems Identified The most pressing problem identified at EMPLOI is the inability of the Recruitment function to provide the qualified recruits to serve existing and new client requirements. Several factors contribute to this problem. First is that the methods currently being used by the Recruitment Specialist are inadequate. Currently, she sources her recruits from only one type of source, the unemployment offices of city governments located near EMPLOI. Moreover, she cannot focus on getting new recruits since she also has to process her recruits back in the office. Processing includes conducting pre-employment exams, interviews, and pre-deployment orientation. Additionally, EMPLOI has not yet built its reputation as the recruitment agency of choice for recruits. There are many competitors, both big and small, who are more favored by recruits for different reasons. The next problem identified is the organizational structure of EMPLOI itself, which contributes to the first problem. Being a recruitment and deployment company, the organization of EMPLOI does not reflect the importance of recruitment and deployment, instead, more emphasis is put on the marketing and administrative functions of the office. This is also evidenced by the operations reports to the CEO which does not include any information regarding the status of recruitment, only the status of deployed personnel. Also related to organizational structure, the dual function being performed by the Admin & Operations Manager concurrently as Marketing Head presents conflict of interest. The former is an office-based function and the latter a field-based one. Since the incumbent is a marketing person, she spends more time in the field than in resolving operations issues in the office. A third problem identified is the pre-occupation of the Accounting Section with payroll processing. Currently, the section does manual payroll six times a month which prevents the accountants from doing more meaningful accounting and finance work. Lastly, another problem identified is the lack of use of technology tools to speed up regular business operations. The manpower pool database, deployed manpower database, payroll and other tedious processes are not computerized. Recommendations and Action Plan The organizational structure should enable the company to effectively achieve its goals. An organizational structure may be of functional, divisional, or matrix design. In a functional organizational structure, authority is based on the relationships between functions. It groups similar or related processes together under the headings like production, marketing, finance, human resources and administration. The advantage is economy through specialization but the organization risks losing sight of its overall goals. A divisional organization separates components into self-contained strategic business units. A central unit focuses on results, coordinates and controls the activities, and provides support services between divisions. Divisions accomplish division goals. The weakness of this structure is the tendency to duplicate activities among divisions. A matrix organization uses teams with members from functional or divisional groups. This type of organization is normally utilized for limited duration projects (Allen 1998). It is recommended that EMPLOI reorganize its structure using a divisional design with the following divisions: Recruitment, Manpower Processing, Marketing, Administrative and Finance. The Recruitment Division shall be responsible for building up the manpower database according to marketable skills. The Manpower Processing Division shall be responsible for processing recruits, conducting exams, interviews, pre-deployment orientation, and manpower relations for deployed personnel, including payroll input preparation for deployed personnel. The Marketing Division shall be responsible for prospecting for new clients as well as client relations or account management. The Administrative & Finance Divisions, together with the office of the Operations Manager should act as the central unit supporting the 3 divisions. It is also recommended that the Operations Manager not function as concurrent Marketing Head. Operations management should focus on carefully managing the processes to produce and distribute products and services. The major activities of operations management include product creation, development, production and distribution (McNamara 2008). For EMPLOI, product creation, development and production may be likened to recruitment and manpower processing, while distribution is marketing and account management. The Operations Manager should ensure that these processes function properly rather than be out in the field handling only one of the processes. Job evaluation is the assessment of the worth of varied jobs on the basis of job and personal factors, such as qualifications and skills. The objective of job evaluation is to determine which jobs should get more pay than others (Business Dictionary 2008). It is also further recommended that a job evaluation be conducted among the work functions at EMPLOI relative to the qualifications and skills of incumbent position holders so that a more effective reorganization can be effected. A Training Needs Analysis is used to determine an organization’s training needs. It assesses the gap between the knowledge, skills and attitudes that the people in the organization currently possess and the knowledge, skills and attitudes that they require to meet the organization’s objectives (TNA 2008). Since the nine full-time employees of EMPLOI have been with the company for sometime, yet have been found to be inadequate in certain areas within their functions, it is recommended that a TNA be conducted and appropriate training be implemented so that employees can be better equipped at handling their functions. A company must know who it is, what it does, and how it is different from other companies. It must have a brand that is identifiable by and creates value for its consumers (Williams, 2008). EMPLOI’s brand may be effective for the purposes of the Marketing division but it is not so for the Recruitment division. It is recommended that EMPLOI’s brand be re-visited in order to include how the company is different and better than other recruitment companies. A new image of EMPLOI should be presented to prospective recruits in order to draw more recruits into its manpower pool. A company’s marketing communications mix consists of the blend of advertising, personal selling, sales promotion, and public relations tools that the company uses to pursue its objectives (Kotler & Armstrong 1998). It is recommended that EMPLOI develop and implement a marketing communications mix that will benefit both its recruitment and marketing divisions. To address the more pressing problem of recruitment, promotion and public relations tools and activities should be conducted. With the affordable costs of computerization today, there is no reason for not putting technology to work in a business. Computers must be utilized if it will help generate revenues and profits. Generating sales is more than just having available products to buy, it is also about having the products the customers want, when they want them. Studies have shown that retailers who do not use computerized inventory management tend to overstock their stores by 20 to 40% (Gen Store 2008). In a similar fashion, EMPLOI direly needs computerization to improve its operational capability to achieve company goals. Computerized information systems should be used in the area of manpower database maintenance as well as regular business accounting processes. Since EMPLOI is a recruitment and staffing service company, it is recommended that it either develops its own recruitment software or procure vendor-developed software. Vendor software for integrated front office solutions for the staffing and recruiting industry will allow the company to synchronize sales and recruiting to generate, source and fill job orders, or make placements, with the best candidates, in real-time, at anytime and from any place (Bullhorn 2007). With the CEO’s directive of exploring the market for recruitment and staffing for blue collar jobs, it is recommended that market research be conducted prior to the undertaking. Market research involves the systematic gathering, recording and analysis of data and information about customers, competitors and the market. Results of market research serve as inputs to the creation of a business plan especially for launching a new product or service (Wikipedia 2008). Finally, it is recommended that a company embark on a business and strategic planning session among its key personnel and the CEO to review and possibly reformulate EMPLOI’s mission statement. The mission statement should be a clear representation of the company’s purpose for existence, incorporating socially meaningful and measurable criteria addressing the company’s moral and ethical position, public image, target market, products and services, the geographic domain and expectations of growth and profitability (BRS 2008). Summary In summary, the following recommendations are made to help resolve EMPLOI’s operational problems: Business structure re-organization Appointment of a full-time Operations Manager Job evaluation of current employees TNA and training for current employees Re-branding to enhance company image among recruits Development and implementation of a marketing communications strategy Computerization of manpower database and accounting processes Procurement of a staffing and recruitment software Market research to explore business opportunities for blue collar workers Conduct of a business and strategic planning session The strategic planning process should be able to determine the timetable for implementation of the above recommendations according to agreed upon business objectives and business priorities. References Allen, Gemmy, 1998, ‘Organizing process’, Modern Management, viewed 2 September 2008, BRS, 2008, ‘Mission statement’, Center for Business Planning, viewed 2 September 2008, Bullhorn, 2007, ‘The on demand, integrated front office leader for the staffing and recruiting industry’, viewed 2 September 2008, ‘Job evaluation’, 2008, Business Dictionary, viewed 2 September 2008, Kotler, Philip & Armstrong, Gary, 1998. ‘Principles of marketing, chapter 13, integrated marketing communication strategy’, Prentice Hall, viewed 2 September 2008, ‘Market research’, 2008, Wikipedia, viewed 2 September 2008, McNamara, Carter, 2008. ‘Operations management’, Management Help, viewed 2 September 2008, ‘Training needs analysis purpose’, 2008, Business Performance, viewed 2 September 2008, ‘Why computerize?’, 2008, The General Store, , viewed 2 September 2008, Williams, John, 2008, ‘ASAP branding’, Entrepreneur.com, viewed 2 September 2008, Read More