Human Resource Management - Case Study Example

 «Human Resource Management» Introduction Human Resource Management is a field which has been there since the dark ages. Conquers, rulers and prophets all managed human resource in order to achieve their goals. So this is not something that industrialization has taught us. But we can credit industrialization of the early 20th century for the development of human resource management as a specific discipline. Today this discipline is taught in every business school of the world and is considered one of the core tools of managers. Human capital is something which can do wonders if utilized appropriately. And if the same human capital is not utilized then it can become a headache for managers. That is why there is so much stress on this particular field when we talk about the corporate world. Human resource management is defined as a strategic approach manages human beings working in the organization in order to achieve goals of the business in an effective and efficient manner (Armstrong, M. 2006). Human capital is not something that can be treated like other forms of capital. The complex nature of human resources is what makes this field important and difficult to understand. Like all other management discipline, in human resource management too there cannot be one right way. On the contrary there can be many right solutions depending on the situation and managers should choose what they think is right. This subjectivity of this field allows discrepancies to creep in human resource management. And for this reason many organization have failed drastically because of flaws in their human resource management technique and thinking. On the other hand there have been organizations that have made extraordinary profits even in the time of economic recession just because of their committed and well utilized human resource. This is another reason why this field is considered the most important field in an organization. There are many purposes of the human resource department but the main function is of recruiting and selecting people who are capable, and managing them in way that may benefit the entire organization. Human resource department also provides incentives to employees who show potential and is also responsible for performance appraisal of the employees of the organization. Human resource management provides all the tools and techniques as to how to deal with all the above mentioned tasks in a way that adds value to the organization Human resource management tells the managers how to us use innovative ways to elicit maximum potential out of the employees. The dynamic and diverse workplaces of today require specific attention on human resource management as globalization has introduced new mediums of communication and operating in such a diverse environment can prove dicey. This is another reason why specific attention is given to this discipline. The case study discusses below will specifically deal with a case of human resource management and will emphasize on the issues the company is facing right now. The case study will also throw light on the curative measures that can help the company in the time of this crisis. Finally the case study analysis will help us understand how leadership can be used in order to manage human capital. Analysis of the Case The company that is discussed in the case study is the Oceatic Airways. The case is about the human resource management of the company and how the organization has failed to maintain profitability due to massive failure in managing in its human resource. The case discusses the factors that have led the company to its downfall. The case also gives brief information on the airline industry of Asia. The main focus of the case is on Oceatic Airway’s HR practices. The case presents the failure of the HR department of Oceatic Airways due to many factors. The information of the practices of the company is given and the main players in the organization are also discussed with the comments of the employees. The case study also identifies many problems in the organizational structure of the company. The company is has seen many interference from the government and that is considered one of the main problems of the company. Communication gap was another problem identified. There are other factors like high fuel prices and other economic factors that have contributed to the downfall of the company. These factors are more or less uncontrollable for the organization. The main information is on the human resource management practices of the company and how different human resource department work in order to perform basic functions of recruiting, selecting, training and promoting. The details of how human resource department work is provided in the case. Human resource problems of the company are actually increasing with the day with more and more employees getting disgruntle about the situation. The company has to start to think about its practices and should revamp all its policies in order to satisfy employees and in turn make profits. Employees actually are a source of income for the company especially in times of uncertainty when airline industry is facing intense competition and fuel prices are fluctuating like anything. Fares are also getting lower and this is adding to the competition of the airline industry (Graham, Kaplan & Sibley, 1983). It is very important for the human resource department at Oceatic Airways to deal with all these problems right now. The company books are already in red and the situation is deteriorating. Oceatic Airways has to act now or the company will not be able to sustain loses for another few years. The main problem is with the human resource department of the company and it needs to be sorted out fast. Below an attempt will be made to identify the main issues the company is facing and what should be the short term and the long term goals of the company. The organizational culture will also be discussed separately as it is a huge problem. Power and politics will also be discussed as an agent of change in the organization and as something that can hinder the change in the company. Identification of Major Issues There are many issues that Oceatic Airways is facing and Mr. Durrani, CEO of the company, has to focus on all these problems. Only then we can hope that any improvement can be brought in the organization. The issues that company is facing right now may be divided into two categories. The first category of problems is those that need immediate attention of Mr. Durrani and these problems should be dealt in the short term. The other category of problems is those that should be focused in the long run. First we will discuss the problems that should be solved in the short run is excess employees. Although the number of employees have lowered in the previous five years but more needs to be done in this regard. Excess employees can prove costly for the company as they will take salary and they will also interfere in the work of other employees which will also hurt the organization. Other immediate problem that should be dealt with is the biasness in selection of employees for training. Training of employees is considered very important in the progress of any organization (Lamond & Zheng, 2010). Training of employees is important as they are the people that can bring profitability to the company. For this reason training of employees should be unbiased in Oceatic Airways. The problem in the company is that training is given to employees but the selection of those employees is not done on merit and this causes a lot of problems as worthy employees are not given training and in this way the whole process of training remains futile. This ought to be handled in the short run. Cost effectiveness is also an issue in the company. In order to maintain profitability the company has to immediately find ways to cut costs and increase profits. This has to be done in the short term otherwise the consequences will be severe. Human resource is a department that can lower wages and should spend less on training. There are other issues in Oceatic Airways are such that will need a long term focus of the company. These problems cannot be solved immediately and they can only be solved in the long run. First issue that is worth giving attention is the lack of innovation in the company. The same old practices are being continued in the company with little improvement and novelty. This is a problem and this cannot be solved immediately. Innovation would have to be inculcated in the culture of the organization and this is a long term process. Innovation is vital for Oceatic Airways as it can help create processes that can help create great profits for the organization. The company should add innovation in its mission statement as this can promote innovation in the organization (Bart & DeGroote, 2000). This can prove great in fostering innovation in the culture of the company. Innovation can also prove beneficial for the company as it operates in a technology driven sector and any innovation can make a lot of difference. Another problem in the company is related to its organizational structure. Many employees identified that they are not sure which person they should report to. There are many bosses of one person and this adds confusion and stress to the employees. This uncertainty is dangerous for the company. This problem can only be solved in the long run because people will need time to adjust to the change. Therefore this change will have to be brought slowly and gradually with decreasing the number of layers in the organization. The process will involve defining new job positions and will require downsizing. Horizontal structure is found to be very useful for an organization (Levinthal & Siggelkow, 2003) and for this reason Oceatic Airways should change its organizational structure to a horizontal structure. The present structure is very vertical in nature and that is why there is lack of communication in the company. For this reason horizontal structure is advised for Oceatic Airways. The company is also having problems in the hiring process and that is another issue that needs to be resolved in the long run. Hiring process in Oceatic Airways is long and rigorous. It should be rigorous but it should not be very long. The whole recruitment process will have to be reshaped in order to make hiring fast and that will take a lot of time and effort by the management. Organizational Culture and its Impact: Organizational culture at Oceatic Airways is a major issue and that is why it should be analyzed separately. The culture of the company is very ‘laid back’ type. Employees take their work very lightly and the motivation to do the work is very low because of the improper rewarding system. The governmental interference does not allow management to function properly and if the higher management is not aware of what is going to happen then what should be the attitude of the lower management? It is not difficult to guess. The uncertainty level of in the employees is very high as they do not know who they report to and what their job description is. Organizational culture has a lot to do with the performance of Oceatic Airways (Heck & Marcoulides, 1993). After all these years of non profitability the employees have somehow accepted that this is routine and they are not ought to change their practices. They do not really contribute to the company and this is where Oceatic Airways is lagging behind. Employee ownership in the organization is missing. They just want to do their own work and get paid for it. They are not too much interested in the performance of the company and this is the reason why organizational culture reflects easiness. Lack of commitment is also a part of the company’s culture. This is because employees know that they will not be rewarded as a result of their hard work but will be rewarded if they have political support. Rewards are important to enhance performance of the employees (Linder, 1998). But rewards system is not good in the company. Power and Politics and Its role in Change: Power and politics have great implications in an organization. They can be used efficiently to enhance the performance of the employees or they can be used to hinder in the work of others. The implications of power and politics are great in organizational change. Management should use these tools to bring about the above mentioned changes in the organization. Management can use power to implement the change but they will face resistance by the employees so they will have to use politics to make the process of change smooth. The combination of two can be very vital in bringing about change in the practices of the organization. It is impossible to ignore the implications of power and politics in today’s organization (Pfeffer, 1993). Employees can be controlled only by a combination f both power and politics. Bu the word of politics we usually take bad meaning and this is not right. Politics can also be done for good reasons. Let’s take an example. Management at Oceatic Airways is planning to change its organizational structure. For that they must take all the parties involved in confidence and then after all the main players are satisfied, the change should be implemented. This is politics but for a good reason. With using both these things no company can bring about successful change in their practices especially Oceatic Airways as they have a very peculiar culture. Possible Solutions Leadership is something that can bring about change in any organization. Dell, Apple, Microsoft and IBM all had great leaders and they helped to make their organizations best in the world. The solution to the problems of Oceatic Airways is effective leadership. Mr. Durrani should start to lead the organization from the front and should first make clear to all the concerned authorities that a change will take place. This will allow the employees to mentally prepare themselves for a change. Organizational structure is closely related to the leadership in the organization (House, 2004). So in order to change the organization structure Mr. Durrani will have to take stern actions and will have to take care that employees are not disgruntled. This can be done by taking them into confidence and by making them involved in the process of change. There is nothing more important to a low level manager or a maintenance guy that the CEO of the company comes and talks to him about his problems. Mr. Durrani should try to meet with these people regularly as these are the people who will be the agents of change. Change can be successful only if the low level guys are prepared to accept it. Another thing that Mr. Durrani can do is to start this open door policy. He should become accessible to everyone in the company and this will help employees understand that the company is seriously changing its practices. Transformational leadership style can be very useful for introducing change in the company (Conger, 1999). Motivational levels of the employees should be increased by giving them targets and by offering reward to them. This will really help employees to take part in the change process. Leadership can do wonders to any organization and if Mr. Durrani is able to do even few of the above mentioned things then he can definitely transform this organization into a successful company. Conclusion The case was about the human resource management of Oceatic Airways. The problems of the company were identified. The main problems of the company are with the motivational levels of the employees. The uncertainty level of the employees is also very high. By changing organizational culture with the help of power and politics significant improvements can be brought about in the company. Leadership of the CEO can also be very helpful. He can lead from the front in order to implement the change in the organization. Bibliography Armstrong, M. 2006. A Handbook of Human Resource Management Practice. London: Kogan Page. Bart, C. 2000. The relationship between mission and innovativeness in the airline industry: an exploratory investigation. International Journal of Technology Management 20(5-8). Conger, J. 1999. Charismatic and transformational leadership in organizations: An insider's perspective on these developing streams of research. The Leadership Quarterly 10(2): 145-179. Graham, D., Kaplan, D., and Sibley, D. 1983. Efficiency and Competition in the Airline Industry. Bell Journal of Economics 14(1): 118-138. Heck, R., and Marcoulides, G. 1993. Organization Culture and Performance: Proposing and testing a model. 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