The Human Resource Management of BMW Group - Case Study Example

PEOPLE MANAGEMENT INTRODUCTION: The Human resource management has long been regarded as a poor cousin as compared to more profit giving departments such as operations, production/manufacturing etc. But with recent times, the need and role of HR is increasingly coming under focus as companies try to attract, employ and retain the best possible talent for their companies. The Human resources people are being recognized as the most important chain in the whole organization who are responsible for getting the actual employees for the company. If the recruitment and selection policy of an organization is not up to the mark, it can have detrimental effect on the whole organization. Thus recruitment and selection are considered the key strategic domains in human resource management. The traditional recruitment and selection procedures are now being questioned and are unable to cope with the fast changing internal and external environment of organizations. Gone are the days when companies gave advertisements in newspapers, and selected some people for interview based on the applications received. Today’s recruiters actively search for people who meet their specific needs by looking around at many different sources. In addition, there is a greater demand for transparency and use of scientific basis in selection procedures. In most of the HR surveys and studies conducted so far, only when formal tests were administered and structured interviews were held, then the selection and recruitments was considered good enough. (Becker & Huselid, 1998; Wright, Gardner, Moynihan, Park, Gerhart, & Delery, 2001; Wright, Gardner, Moynihan, & Allen, 2005) The recruitment process is now quite complex and can be both internal or external and it involves many different steps such as recruitment policies, advertising, job description, job application process, interviews, assessment, decision making, legislation selection and training (Korsten 2003, Jones et al, 2006) The new methods of recruitment now also include online recruiting. The introduction of internet and websites have helped organizations to reduce costs significantly by posting vacancies online on their own sites or by using third party job boards. This allows the companies to provide more detailed information of the job and the profile of candidates they are looking for. The use of online job boards and websites provide opportunity to include rich media content such as graphics, photos, interactive text, and videos (Allen, Van Scotter, & Otondo, 2004). Other authors such as Dineen, Ash, & Noe, (2002) and Dineen, Ling, Ash, & DelVecchio, (2007) also point out the advantage of being able to tailor the recruiting information as per the needs of prospective candidates. Moreover, the tailored information or requirements also helped to avoid candidates which do not fit into organization culture and thereby saved unnecessary time wastage of recruiters. (Dineen et al. 2007) In addition to these advantages, it is pretty clear that online recruitment also saves time wasted in needless posts. Although traditionally, recruiters have only looked for filling up the vacancies with the best possible candidate who applies for the job, the things are changing now. The newer methods used by recruitment agencies involve a proper analysis of the job and the requirements of the organization . The recruiters also look at the labor market conditions and use many diverse methods such as interviews or psychometric tests to determine the suitability of candidates. But the quality of applicants has always been an area of concern for the recruiters. Now experts such as Carlson, Connerly, and Mecham (2002) are focusing on this area and show that the quality of the applicants who are attracted to the company tell us about the overall usefulness and quality of the recruitment and selection system. There are many factors which attract a potential candidate to a company or an organization. And it has been proven that the image of an organization is one of the most important factor in the minds of candidates. For example an analysis done by Chapman et al. (2005) should that there is a mean correlation of .50 between image and intention to join the organization and .40 for attraction. And the most candidates form an impression based on the familiarity and brand recognition. Thus job seekers are more inclined towards companies that have name or brand recognition (Cable & Graham, 2000; Cable & Turban, 2001; Collins & Stevens, 2002; Turban, 2001). Moreover, it has been seen that they make choices and form opinions about organizations depending upon on how they are treated during the selection process. Having taken a look at some of the literature and trends in recruitment and selection criteria in companies, I will take up the case of BMW to provide a reflective work based analysis of the BMW companies HR practices and policies. BMW Founded in 1916 in Munich, the BMW organization is one of the ten largest car manufacturers in the world and a leading name in the luxury automobile sector. BMW (Bayerische Motoren Werke) Group is headquartered in Munich and is known for its excellence and its luxury sedans, SAVs, Convertibles, Roadsters and motorcycles. Its products are sold under three main brands -- BMW, MINI and Rolls-Royce Motor Cars and has 23 production facilities in 13 countries, 39 sales subsidiaries all over the world and 10 locations in the Research & Development network RECRUITMENT AND SELECTION POLICY IN BMW The BMW group strives to be the most successful premium manufacturer in the industry and its growth strategy involves looking for potential opportunities and working within their limits and identifying and building on their core competencies and is committed to a very high quality of its products and services. To attain this growth and its objectives, the group has a very specific recruitment and selection policies. They look for candidates from both internal and external markets but preference is given to the internal candidates. If there is no available or interested internal candidate then external recruitment is done. The HR department or the BMW centre for development is proactively involved in development of their employees’ careers and encourages them to apply for and undergo various training programs being conducted in house which are Management, Sales, After sales, Technical and Dealer Services. The company is committed towards an equal opportunity policy. They have specific selection process for both in house and outside candidates. They provide a very good idea of their organization and job vacancies to prospective candidates by organizing special selection events and seminars. The BMW group has a very good and comprehensive training programs and they offer consistent and up-to-date training on new technology and products. There are many apprenticeship programs available such as BMW Body shop or Parts apprenticeship etc. for 2-3 years which include both classes and workshop sessions. As a member of the HR management team, I have had the opportunity o closely look at the selection policy of BMW group and work in applying Equal opportunities policy to different groups. As a company, which is striving to be number one in the market, we have always been on a lookout for employees who are not only well qualified and capable but also committed to its vision and objective. Our company has realized the importance of having motivated employees as the key to their success and ensuring a competitive edge over its rivals. And we are doing it in our own way by following a very employee friendly human resource policy. In today’s competitive world, there is intense rivalry between competitors and this leads to the lookout for the best possible candidates who suit the corporate culture, ethics and climate specific to the organization (Terpstra, 1994). BMW is also no exception to this rule and tries to attract the best people to its fold. We treat our employees as our associates and provide the best possible training and environment to them to ensure a very high efficiency constantly. As Korsten (2003) put it, Human Resource management involves focus on meeting corporate objectives and alignment of HR policies with the overall company wide strategic initiatives and plans. And this is realized through proper selection and training of employees and manage to retain an efficient and motivated workforce. The second part of retention is especially important because of the turnover is high, it eventually means that either the company is not good enough to retain talent or there is some serious problem in the selection process. Our company stands tall on both accounts as we are able to attract the best talent and also retain them with us. We use an eight stage recruitment procedure with stress on our brand name BMW. Our website offers the vacancies whenever there is an opportunity and we invite people to take part in out apprenticeship courses hose information is available both online as well as offline. The candidates are subjected to preliminary or screening tests such as Saville and Holsworth.. The quality of teaching is quite high. And the teachers are all certified and match the best in current industry standards. They are also sent for furthr training courses or refresher courses to Germany for blocks of training one or two weeks twice a year. Lot of emphasis is paid on the development of overall soft skills in addition to the technical knowledge. We use both hands on and classroom teaching methods and students are encouraged to spend more time in their BMW work placement as employees. We provide library and computer access services and in the induction itself an employee is shown the map of the organization and his possible route to the top. The students are continuously assessed in both forma and informal manner and feedback provided to them. We have more than 90% achievement rates in BMW retention rates are more than 63%. As a part of HR management team, My job has been to oversee selection and recruitment of young apprentices for starting level positions. I have been involved in both internal and external recruitments. I found that whenever we went for internal recruitment, the workers or the employees showed lot of interest and motivation, Moreover, since the employee was already part of the BMW group, we need not spend time on his induction or explaining about company objectives or culture. The employee could straightaway move to job specific training. In addition, the employee would be known to the organization and he was better accepted by the others. But on the flip side, there was some unhealthy competition between some employees which need to be sorted out properly otherwise some of them were left with discontented people. On the other hand, the external recruitments were risky though they brought in fresh ideas and insights with them. But obviously, they took more time to adjust and had to be given full training before being assigned their work. As a personal choice, I have always preferred internal recruitments over the external ones and found that the company people benefit from it. If all the plum positions and assignment are given to new recruits, there is bound to be loss in motivation and the employees feel that they are not needed or good enough. In fact, I have seen the older employees providing no help of cooperation to the new employee joining from outside if they perceive that one of them could have got that position or promotion. They also start looking for a new job and the responsibility of seeking help or getting thing done is thrown solely on the new recruit. EQUAL OPPORTUNITY LEGISLATION Part of my duties was also to implement Equal opportunity strategies in the organization. As per the legislation and best practices, all businesses should ensure equal opportunities for all people. This should be especially done while recruiting and selecting employees for the organization, when there are cases of harassment, bullying, discipline etc, providing facilities or helpful working options to the workers such as maternity leaves an pay or flexible working hours etc. There have been two specific incidents in BMW history which highlight their readiness and commitment towards ensuring equal opportunities to all. The first incident involved BMW’s Oxford plant where there was disparity between pay and salaries of workers. The situation did go out of hand as workers went on strike but it was quickly restored to normalcy after we agreed to take a partnership approach to tackling equal pay. Te staff and members of workers trade union were invited to a two day training course to understand each other’s issues and make a common platform to carry out the equal pay review. It was this initiative that helped BMW to turn around its fortunes in Oxford plant and led to restructuring and productivity gains and its workforce nearly doubled. For this effort it was also given the Chartered Institute of Personnel and Development/People Management award. There were quite a few lessons that were learnt from this episode. First, in order to be the world’s premier car manufacturer, BMW needs to attract the best possible talent in terms of its human resources. It cannot do so if it is seen as a company that resorts to inequalities in basic pay structures. By agreeing to do the pay review and actually making the salary adjustments by being transparent about its recruitment, selection and promotion activities, we were able to capitalize on a good brand image and motivated and contented employees to get a boost in productivity and performance of the employees. The second incident was related to the Equal opportunity for women and BMW used the practice of targeting the women workforce for bridging the gender gap. In the equalities context, targeting is considered as a positive action strategy whose basic objective is to increase number of specific group of people to join the workforce or show interest by applying for he jobs. According to the an Equal Opportunities Commission report (2004), about 97% of those opting for Automobile Industry are men. Women hardly seek any jobs in this industry. Thus BMW came up with what is known as the Technical girls’ project. Based on its initiative on equal opportunities employer, BMW with its world wide twenty factories carried out a survey within its environment to check the participation of women in their workforce. This pilot project was first started in Munich plant. and the survey also hinted at the reasons on very low participation of women in technical areas. To reduce this gender gap and bring more women in its workforce, we started a pilot project in Munich. As part of this initiative, the pilot team started with identification and encouraging the technical skills of women and brought in the women to be role models to others. They went to schools and colleges with their programme and provided information and requirement to women and allay their fears regarding technical jobs. They purposely selected only women and gave them the necessary training as female technical apprentices. Our initial target was of having about 15% female technical apprentices. Special technical camps were organized for women and practical training imparted and women were allowed to work on some of the live technical jobs. In addition to this initiative, another special programme called “Drive” was launched for training women in managerial jobs. There was a better participation at this level as 20.8% of participants were graduates -- mainly engineers and 31% of women were at doctorate level. Both these projets led to an increased awareness of BMW and its technical job to women workforce and led to their wider acceptance and participation. We were able to dispel some of the fears of too much technicality of our jobs and as a result able to obtain a much more dedicated lot of employees in our plant and gave us the opportunity to select a whole new lot of talent from this vast unused pool of resources. (It is a well known fact that women are more dedicated and loyal employees than men) The actual results show that the participation of women apprentices rose to 15% in 2003 and was expected to reach 28% next year. In comparison , the other German BMW plants had 7% of its technical apprentices as females Buoyed by the success of its Munich initiative, our company decided to step up the project and extend it to other manufacturing plants as well and recruit as many girl apprentices as possible in the future. The focus is not only on the recruitments and selection but also on retention of its female workforce. Another set of initiatives were launched to retain these women in the workforce and make them see working in BMW as a lucrative option. It was seen that on average women were working with BMW for about 7 to 10 years. Most of the female workforce was dropping out after marrying or having children. So to make their lives easier and helping them cope up with their work and home lives, BMW launched many schemes and benefit plans specifically for them. The company gave women the option of working part-time and sponsored many child care centers to promote conciliation of work and family life Flexible timings were also introduced for non-production workers. As a result, BMW is considered one of the best companies in terms of employee satisfaction and has the highest percentage of part-time workers in the automobile industry. In fact, now even men are considering working part time and taking the option of flexi times offered by the company. . CONCLUSION To conclude the above analysis, I can say that BMW as a company has come up with number of measures to become more employee friendly and attract the best talent for its manufacturing plants. They have realized that people can be the source of competitive edge over its rivals and they are very keen to leverage their competitive advantage of having a talented and motivated employee force. Their commitment to the equal opportunity legislation is commendable Their Technical girls project was a success and has been instrumental in generating awareness amongst women on jobs in automobile industry. Personally, I have been able to look at these issues of gender bias and discrimination from a more balanced point of view and I understand that sometimes even though the companies do not follow a discriminatory policy, the external and internal environments are such that certain specific groups are unable to either enter such job markets or have inadequate or misleading information about them which keeps them away. Moreover, there are many methods and ways to recruit people but, it is important that a proper on job training is given to the employees before they can become a productive member of the team. A good and unbiased environment plus a transparent policy of promotion and incentives could go a long way in securing a fruitful partnership between an employer and its employees. References Allen, D., Van Scotter, J., & Otondo, R. (2004). Recruitment communication media: Impact on pre hire outcomes. Personnel Psychology, 57, 143-171. Becker B.E., & Huselid M.A. (1998). High performance work systems and firm performance: A synthesis of research and managerial implications. In G.R.Ferris (Ed.), Research in personnel and human resource management (pp. 53-101). Greenwich, CT: JAI Press. Cable, D.M., & Graham, M.E. (2000). The determinants of job seekers' reputation perceptions. Journal of Organizational Behavior, 21, 929-947. Cable, D.M., & Turban, D.B. (2001). 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