HR Management Manners Europe Case - Essay Example

 Manners Europe case study Abstract Manners Europe has been facing significant human resource issues. The purpose of this report is to identify these issues and develop a suitable strategy for removing them from the organization. The organization has been encountering problems regarding lack of motivation and dedication on behalf of the employees. There also exist considerable issues pertaining to cultural differences between the superior managers who are mainly US based and subordinate employees who are Europeans. These issues have been discussed elaborately in the report in order to arrive at suitable recommendations and conclusions. Introduction Manners Europe is a part of a US based company operating in several different industries. The company is located worldwide with its sales volume largely generated from the nations of the US, the UK, Netherlands and Belgium. A large portion of the company’s revenue comes from the US through manufacturing, wholesale and retail activities involving lumbering and forest related products. The main area of business of the company is related to forest products and activities. Manners Europe is also the largest company in the world in its respective industry. In last two years, the company has remained successful in increasing its sales from $1.5 million to $10 million. The sales were mainly created from the four stores located in Netherlands, three in Belgium and three in the UK. The company follows the strategy of hiring from the nation where its operations are conducted. For such reasons, only 225 employees of Manners Europe were Americans. The company was given high autonomy from its US counterpart. This gives the management of Manners Europe high independence to make decisions relating to hiring and capital expenditures. John Wilman is the managing director of Manners Europe. The building supplies and home improvement retail outlets, for which Wilman was responsible, had remarkably expanded in last four years of the company’s operations in Europe. The expansion of the company into the European markets has undoubtedly proven to be a profitable venture. The revenues of the company had risen significantly. The company’s remarkable performance in the European nations has led it to consider undertaking expansion plans. Wilman is set to solve existing problems of the company so that there are fewer issues to manage during the expansion. Wilman also considers issues that are set to arise in the coming two and a half years. Although the company had been operating well for the past years, it was observed that there existed significant issues. It was important for the company to address these issues soon before they start affecting the business operations. Diagnosing the problem Motivation One of the prime issues faced by the company was relating to the aspect of motivation to work. Employees were seen to be less serious about their commitment towards the organization and to give personal life more importance at all occasions. They fail to realize that at times when the organization requires employee commitment, it becomes necessary to put aside personal lives temporarily. When employees are faced with emergencies, the company realizes the situations and grants them leaves so that they can meet their responsibilities towards family and others. Similarly when the organization is encountering an emergency scenario, it is the responsibility of employees to put aside their personal lives and meet organizational needs. Employee-organization commitment is, therefore, a two way aspect (Boxall and Purcell, 2003). Tom Steiger, the Director of Finance, had cited an example to Wilman related to employees’ motivation to work. Tom said that the company was often late in submitting reports to the US office. A week earlier when the company was trying to meet the time schedule for accounting reports, Tom and two other employees decided to come in early on Saturday. One of the junior employees of the two had taken leave from the office after working for only two hours and then returned after almost four hours. The employee completely neglected the matter that the company was facing a deadline issue and it was required on his part to stay and help the other employees in completing the task on time. The employee’s reason to leave office was that he had to attend tennis classes with his wife, which was important to him. Tom also stated that similar attitude towards work was also seen to be portrayed by contractor of the company. The last job that was assigned to the contractor relating to the parking lot getting paved was delayed due to bad weather conditions for eight consecutive days. Finally, when the weather cleared, the contractor and his workers were missing from the site as they took a trip to the beach. Culture The company expects that by providing attractive salaries, employee contribution towards the organization becomes higher. Linking motivation with work performance has not proved to be beneficial for the organization. Employees are seen to give greater importance to their social and personal lives and commitment towards the organization is less. Employees appear less work oriented in the European nations than in the US. This cultural difference distinguishes the needs of employees from that of the organization. Since Manners Europe is basically a US based nation, employees are expected to deliver high performance. Tom assumed that by incorporating better salary structures and providing increments, employees would agree to bear additional responsibilities. In reality, it was observed that employees avoided accepting increments and preferred to continue working with lower incentives so that they need not take up additional work pressure (Armstrong and Taylor, 2014). The work environment in Manners Europe for expatriate employees is also seen to be extremely de-motivating. Employees working in the company who hail from other nations are not approached or treated appropriately by other employees and subordinates. European employees appear to consistently complain against such expatriate managers. This reflects the culture that in Europe, employees do not prefer to work with those from other nations. Since Manners Europe is largely a US based firm, a considerable portion of the employee strength consists of those from the US. Lack of corporation and cultural differences makes it difficult for such employees to work alongside the Europeans, thereby leading significant cultural barriers to exist in the organization. Cultural issues are commonly found to arise in many multinational firms. Hofstede’s cultural dimension theory states that social cultural aspects influence organizational behaviour to a large extent. Maintaining adequate work-life balance is an important aspect for employees. In the US, individuals give adequate importance to organizational goals, besides individual goals. The management by objective culture is quite common in the US. The organization goals are set jointly by considering needs of both the employees and the organization. Employees are expected to commit themselves to the firm when required, putting aside other aspects. However, this culture is found to be absent in the European nations. Employees in many of the European nations give more importance to their social and personal lives compared to organizational duties. They refrain from taking additional work load and stick to only what is required of them to do (Evans, Pucik and Bjorkman, 2011). Recruitment The company was finding it extremely difficult to find talented employees and recruitment was a major issue. The rate of unemployment in Netherlands was extremely low. As a result, the company was facing a shortage of talent. Moreover, it was observed that Dutch employees were reluctant to work for the US and other multinational firms. Majority of the workforce in Netherlands found the US firms to be heartless, demanding and requiring excessive hard work. Hence, people prefer working for European or local firms. Only ten percent of the Dutch preferred working for the US firms. Similar problems were also seen to persist in case of expatriate employees. In Belgium, there were many complaints from employees against a German general manager. The German manager was stated to be autocratic and employees were not satisfied working under him. Finding employees with the right educational background was also difficult. The percentage of adequately educated people in Netherlands was significantly high. Such people would not take up jobs as supervisors. Workforce supply was seen to be largely under qualified. Hiring experienced people from other firms was also subject to several uncertainties. As per the Dutch policies, firms were required to keep the employee information discreet. The company is seen to follow the objective method of selection whereby it relies upon the information provided. The objective method also incorporates assuming that employees are rational and give more importance to the pay packages and other benefits associated with the job. Applicants are expected to weigh these factors and accordingly arrive at a desirability index. Even so, this model is not suitable in the Dutch scenario. Employees in the Dutch context are seen to respond to social and psychological needs more than the objective needs (Wright, Dunford and Snell, 2001). Human resource planning Human resource (HR) planning refers to the process of strategically selecting, recruiting and training employees so that organizational objectives can be rightly met. HR planning plays a vital role in selecting the right staff members required. The HR planning process involves identifying the organizational goals and linking the same with personnel requirements of the organization. In order to perform the organizational activities successfully, it becomes essential to recruit the right type of talent. HR planning includes screening employees by matching employee talent with talent requirement of the firm. Manners Europe is facing difficulties in respect for procuring skilled employees. In Europe, it is seen that the level of employment is very high and majority of the working population are well educated. Hiring employees at the supervisory level, therefore, becomes quite challenging as highly educated employees do not prefer to work at such levels. They show greater inclination towards managerial posts. Additionally, a large section of the employees are not willing to work for the US organizations due to cultural differences existing between the European and US nations. Another potential challenge for the human resource department was to establish a suitable salary structure in the organization. A common HR strategy is to improve organizational affectivity by framing a suitable salary structure. Salary is considered to play an important role in attracting talented employees. This strategy is seen to be less effective in Europe in comparison with the US. In Netherlands, employees are not motivated by high salaries. As a result, formulation of HR strategies for improving employees’ performance acts as a challenge. It is observed that the HR policy of Manners Europe lacks control and efficiency. The company has not been successful in matching employing talent with its talent requirements. As a consequence, many inefficient employees have been selected for being promoted to high positions. This also signifies that employee appraisal techniques are not effective. Work and pay allocation is not done as per contributions made by the employees towards the organization. This has resulted in paying of higher salaries to inefficient employees, while hard working employees are not given proper recognition and pay (Batt, 2002). Communication The communication flow between employees and the management is seen to be lacking structure. The management is not effectively communicating with employees in respect of the dissemination of information and responsibilities. Employees are seen to take the management for granted and repel several policies established by them. Since there exists a cultural disparity in the organization, communication between superiors and subordinates is further hindered. The US style of management believes in developing both formal and informal style of communication in the organization. The diverse scenarios, which are set to arise in an organization, call in for different types of communication methods. Lack of proper communication between the management and the employees is regarded as one of the prime causes behind conflicting ideologies of both the groups (Collins and Clark, 2003). Managerial style The company is found to largely follow the people’s theory of management. The people’s theory involves allowing employees adequate liberty to take decisions and mange work by themselves. The level of autocracy in such organization is very low. The people’s style of management although is considered to be effective, is depicting negative results for Manners Europe. Although excessive control is not an effective policy for firm’s success, lack of control is not beneficial as well. The company is, therefore, required to establish suitable control and monitoring policies. The people’s policy of management has made employees reluctant to take responsibilities. The company should consider establishing the contingency policy of human resource management, which involves developing leadership strategies based on its requirements. Analysis of the different issues present in Manners Europe also shows that there is lack of a suitable governance style. The management is lenient towards employee misconduct and has also remained negligent about absence of employee dedication. As a result, employees are seen to overlook management policies and avoid abiding by the policies established. This has led to weak performance and failure to meet target goals in many occasions (Allen, Shore and Griffeth, 2003). Training Training is considered as an effective way to improve employee performance. The company is seen to lack in providing adequate training facilities to the employees. It is observed that employees at various levels lack efficiency. It is essential for the company to identify training needs and accordingly develop suitable programs. The organization provides little training facilities to the employees when they join the firm. Hence, productivity of employees appears to be low in long run. Training also helps in enhancing the level of employee motivation. It helps them to understand and relate to objective of the organization. The organization must also provide training facilities to the employees in respect of developing organizational unity and collective behaviour. Analysis of the different issues encountered by Manners Europe also shows that the company lacks in establishing a suitable governance style, which has entailed weak organisational performance and inability to meet desired business goals. Training is an essential aspect when employees are sent from the home nation to another. This helps them to adapt to new cultures easily. Many of the expatriate employees are unable to adjust with the culture existing in Manners Europe because of lack of training (Whitener, 2001). Appraisal Appraising employees enables an organization to measure their performance. The motive behind an appraisal program is to check whether employee output is equal to the input. Inputs largely include the salary, training cost and other expenses incurred to an organization while hiring an employee. Employee output encompasses increase in the organization’s productivity due to their contributions. Manners Europe has not been incorporating suitable appraisal techniques. Hence, inefficient employees are seen to be paid more and promoted to superior job positions (Dowling, Festing and Engle Sr, 2008). Conflict Conflict arises when there is difference of interests. Organisational conflict is mainly seen to occur due to cultural differences and lack of proper management structure. The autocratic style of management adopted by the German manager in Belgium had led to serious conflicts in the organization. Conflict is largely seen to surface between the management and employees in respect of salary structure and increments. Proper training and communication strategies are essential for reducing these conflicts. Conflicting situations also arise because of improper work distribution. Efficient employees are given supervisory responsibilities, while inefficient employees are given important job roles. When employees fail to meet desired results, conflict arises between the management and employees (Gatewood, Feild and Barrick, 2010). Recommendations and conclusion An analysis of Manners Europe from different points of view suggests that one of its primary issues faced is the lack of employee dedication. As employees are not adequately motivated to work, they ignore their responsibilities. Another significant issue is relating to appraisal structure of the organization. Wilman needs to consider establishing a proper appraisal system in the organization so that employee performance and abilities can be rightly judged. This would help the company to assign job responsibilities to the right candidate. As a result, organisational objectives can be better achieved. A suitable appraisal technique also helps in setting a proper salary structure. Employees must be remunerated as per their contributions towards the organization. Apart from appraising, employees must also be trained adequately. Training is required to be given on two grounds. Firstly, the company is required to impart training in respect of improving employee performance and educating them upon how the organization requires them to perform. Employees must be educated regarding their job responsibilities. The European work culture considers giving less importance to the organizational needs. Training must, therefore, be given to employees so that they can realize the importance of their contribution, thereby encouraging them to perform better. Secondly, the expatriate employees must be appropriately trained for easily adapting to the European culture. Hiring experienced individuals who are familiar with working only in European firms is, hence, not a good resourcing strategy. Wilman can rather consider hiring inexperienced and moderately educated employees. Since such employees lack experience, they can easily adapt to an organizational culture demanding high employee contribution. Wilman can also hire employees who have prior experience of working in multinational firms. Manners Europe is largely seen to face cultural issues, which have affected motivation and morale of the employees. Suitable hiring techniques and developing an integrated management structure can enable the management to overcome majority of their issues. Manners Europe must realize that adopting an MBO style of management in Europe is not an effective strategy. Europeans are more inclined towards their personal lives than their professional lives. As a result, it becomes essential that the organization to develop a style of management, which helps in striking a balance between personal and professional lives. Respecting the European culture and celebrating their festivals is also a suitable technique for bridging cultural differences. The organization must consider providing holidays on important European festive occasions and those of national significance. The company should also provide employees with adequate number of paid leaves so that they are able to meet the responsibilities of their personal lives better. On working days, employees must not be allowed to leave the organization unless in an emergency. Reference List Allen, D. G., Shore, L. M. and Griffeth, R. W., 2003. The role of perceived organizational support and supportive human resource practices in the turnover process. Journal of management, 29(1), pp. 99-118. Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management practice. London: Kogan Page Publishers. Batt, R., 2002. Managing customer services: Human resource practices, quit rates, and sales growth. Academy of management Journal, 45(3), pp. 587-597. Boxall, P. and Purcell, J., 2003. Strategy and human resource management. Industrial & Labor Relations Review, 57(1), pp. 84. Collins, C. J. and Clark, K. D., 2003. Strategic human resource practices, top management team social networks, and firm performance: The role of human resource practices in creating organizational competitive advantage. Academy of management Journal, 46(6), pp. 740-751. Dowling, P., Festing, M. and Engle Sr, A. D., 2008. International human resource management: Managing people in a multinational context. Connecticut: Cengage Learning. Evans, P., Pucik, V. and Bjorkman, I., 2011. The global challenge: International human resource management. New York: McGraw-Hill Irwin. Gatewood, R., Feild, H. and Barrick, M., 2010. Human resource selection. Connecticut: Cengage Learning. Whitener, E. M., 2001. Do “high commitment” human resource practices affect employee commitment? A cross-level analysis using hierarchical linear modeling. Journal of management, 27(5), pp. 515-535. Wright, P. M., Dunford, B. B. and Snell, S. A., 2001. Human resources and the resource based view of the firm. Journal of management, 27(6), pp. 701-721. Read More