HRM in the Pharmaceutical Industry - Essay Example

HUMAN RESOURCE MANAGEMENT ON EMPLOYEE SEPARATION AND RETENTION TABLE OF CONTENT Background .3 Internal Investigation .4 External Investigation .5 Strategy to Effect a Lasting Solution ..7 Conclusion....8 HUMAN RESOURCE MANAGEMENT BACKGROUND In my organization, Mayflower Pharmaceutical Company Limited, we have a reputation as one of the producers of the highest quality of drugs. We have won several quality standard awards from the International Standard Organisation, and the National Agency for Food and Drug Administration and Control, [NAFDAC]. Our products were well received in most hospitals and healthcare centers nationwide and beyond the country. For the past two years, however, the company has been experiencing rapid staff separation in the Ampicillin unit of the production department. The skilled workers in that unit have been leaving in drove and that has led to series of employment of fresh hands that also end up leaving. The worse happened when the National Agency for Food and Drugs Administration and Control sanctioned Mayflower Pharmaceutical Company for poor quality product among its Ampicillin brands, the hard gelatin capsule. That unit had to be shut down by the regulatory agency when a batch from the unit was found to contain only placebo capsules. The management is bewildered because of the dent the occurrences have made on the good image of the company. Of particular concern is the poor quality detected among our brands of Ampicillin. Off equal concern is the seeming fear by prospective employees to apply for positions advertised by Mayflower to avoid being relieved of their jobs or being forced to resign prematurely as had been the case in the company. Following the problem, the company has engaged the services of a change manager to look into the phenomena with a view to checkmating the problem and finding a lasting solution to deter a recurrence. The terms of reference are for the change manager to investigate the causes of the rapid separation of skilled employees from the company. Identify the reason[s] why the company finds it difficult to retain its workers in the concerned unit long enough. They will also investigate the cause of the substandard product, which were pushed into the market, resulting in the closure by NAFDAC of the Ampicillin unit of the production department, a major part of the department and a good source of income for the company. INTERNAL INVESTIGATION The change manager's internal investigation which involved interview with the staff of the affected unit revealed the following grievances on the part of the workers: [1] The staff complained of the health hazard involved in working in the Ampicillin unit. They claim that because of the peculiar nature of the product they fabricate, they develop health disorders after a certain period of working in the unit. [2] They complained of the management's lack of care when a worker reacts to the effect of the Ampicillin product. They claim that instead of sending the workers to the hospital for treatment, the management quickly relieved them of their jobs with little or no compensation, and go ahead and engage fresh hands to replace them. This makes experienced workers from other units refuse to be posted to the Ampicillin unit. [3] Another revelation was that workers in that unit were dissatisfied with their salaries, perks and the benefits offered to them by the company. [4] Some of the aggrieved workers complained about management's refusal to post them to another unit after working in the Ampicillin unit for a particular period of time, before showing symptoms of Ampicillin side effects, as is done in other pharmaceutical companies. [5] It was also discovered that a lot of the workers in the Ampicillin Unit are women who in most cases were made to leave the job due to marital issues. A majority of the ladies left as soon as they got married on the request of their husbands, most of who work in other parts of the country. [6] It was discovered that management disengage quite a number of the workers due to poor performance, even before the completion of their probationary periods, while some others left because their employments were on temporary basis. [The latter being mainly workers on industrial training, and internship]. EXTERNAL INVESTIGATION The consultants discovered during the course of the external investigation that other pharmaceutical companies do the following to their workers: [1] They send their workers from the Ampicillin Units for regular preventive medical check-ups in the hospitals and where necessary, staff are given appropriate medical treatment and the cost of such treatments are usually borne by the company. [2] That because of the nature of the Ampicillin Unit, they have in place special remuneration package for the workers who work there. [3] Other pharmaceutical companies employ more male than female workers in that unit to allow for continuity and longevity on the job. [4] A separating employee is usually interviewed by a manager from another unit who is not his direct boss to ascertain the reason why s/he is leaving. The objective of such interview is to get unbiased feedback from the employee about the company's policies, procedures and problem areas. Such information gathered are usually recorded in a paper and circulated to the top management. The feedback obtained is looked into seriously and serves as a good raw data through which various irritants and lacunae in the organisation are eliminated. [5] The management of these companies investigated have in place good retirement and pension benefits to ensure that workers from their Ampicillin units leave with enough benefits to take care of themselves and families and to treat any ailment that might develop on the long run after retirement or separation to another organisation. [6] Further discoveries showed that the staff turnover is not as rampant as in Mayflower Pharmaceutical Company Limited. Workers work for as long as they wished because they enjoyed their works and rarely presented any symptoms of the peculiar side effects associated with working in the Ampicillin unit. This is because of the preventive measures those companies have in place for their ampicillin workers. The consultants went on to investigate the cause of the production and release to the market of substandard ampicillin hard gelatin capsules [in placebo form]; all of which have been withdrawn from the market by the order of the National Agency for Food and Drug Administration and Control, along with the closure of the unit. The result of the investigation was as follows: Lack of commitment by some skilled, but disgruntled workers Insufficient skilled workers due to persistent resignations and termination of workers halfway in their careers in the unit. Rapid separation of qualified and skilled workers who move to other companies in search of better care and the proverbial "greener pastures". Failure of the Quality Control Department to do proper check during and after fabrication of the products. A situation which eventually led to the closure of the important unit of the company/ The drugs had to be withdrawn completely from the market because of a complaint lodged to the NAFDAC by a doctor in one of the reputable hospitals when three different patients failed to respond to treatment after the Ampicillin capsules brands of Mayflower Pharmaceutical Industries were administered on them. A test carried out by NAFDAC in their Laboratories showed that certain batches were not properly fabricated and were just passed by the company's Quality Control Department without thorough check. Further investigation revealed that the entire company would have been closed down, but for the reputation they have built up over the years for high quality products, and also the fact that random tests carried out on other product brands such as Paracetamol, ascorbic acid, multivitamin capsules and syrups were found to be of the highest standard. Nevertheless, the Ampicillin incident has left a huge dent on their otherwise good reputation. STRATEGY TO EFFECT A LASTING CHANGE From the investigation, the consultants came up with the following strategy to effect a lasting change in the affected unit and all other units of the organisation. [1] To put in place some control measures, e.g. have a well designed and dynamic Compensation and Benefit System which is highly competitive with what obtains in the pharmaceutical industry/ [2] Provide opportunities for further growth in the unit [and other units] in the organisation via career planning/succession planning, to ensure availability of skilled and experienced workers in each unit at all times. [3] Develop a highly conducive and proactive work culture in the organization as a whole, where openness, creativity and commitment are valued. [4] Institute exit interview system to be conducted by neutral managers with a separating worker. The objective is to: [a] persuade a good worker to remain and continue his services for the company and [b] to get important feedback from him about the organisation's procedures, policies and problem areas. Such feedback should be recorded on paper and circulated to the top management for improvements where necessary. [5] Where the reasons as to why an employee wishes to leave has been ascertained via the exit interview, if the employee is work retaining, attempts should be made by the management to eliminate dissatisfiers, if any and retain his services for the organisation. [6] Management should adopt a method to ensure that the outflow of employees does not exceed the inflow to allow continuity. [7] Good employees should be retained and developed to assume higher levels of responsibility in the organisation. [8] Management should take definite steps to identify any further or remote causes and keep turnover of staff at an acceptable level. This is because retaining talent and creating conducive work culture to facilitate performance would ensure the organisation's health and success. CONCLUSION Studies on employee separation and retention have revealed that the reasons why they leave, apart from monetary issues, include the following: [i] Lack of recognition [ii] disagreement with culture or direction of the company [iii] Poor treatment by their boss [iv] Lack of excitement about their growth prospects [v] Poor relationship with co-workers. It will help the company to try to retain its good employees because of the cost in hiring the staff in the following areas: [a] Finding the employee [through payments on adverts. or employment consultants to recruit and employ a new staff]. [b] Employee training [c] Loss of productivity and filling in for the employee who leaves It is said that the above costs can easily equal 150% of the base salary of the person who left. For instance, if he was earning 50,000, the cost to replace that person will be approximately 75,000, and this money comes out of a company's hard-earned profits. It is advised that the company should look into the following issues: [1] Ensure the worker is given basic healthcare benefits at reasonable rates [2] Consider adding lifestyle benefits that are cost effective. [3] Find out what employees want from their career and what the company can provide for their needs. [4] Be as flexible as possible about how the work is done. Below is a list of reciprocal expectations of a worker and his manager in a workplace situation: EXPECTATIONS By the Manager By the Worker Cooperative effort Problem solving by the worker Considerable self management Production beyond the minimum required Improvements in overall group performance Open communications of any unresolved problem Cooperative effort Some problem solving Some self Management Service beyond the minimum required Performance as required Adequate compensation A Sense of belonging to company Sense of importance Sense of accomplishment Sense of purpose Training & knowledge Sense of fulfillment through autonomy to do what they want to do Adequate compensation Sense of belonging Sense of importance Sense of accomplishment Sense of being valued Adapted from "The Leader Manager" by John N. Williamson [1986] QUALITY CONTROL DEPARTMENT Mayflower Pharmaceutical Company should do proper in-house investigation to find out why the substandard ampicillin products were released as of good quality and apply the appropriate punitive measures to the offender[s] Let the quality of the staff and managers at the Quality Control Department be reappraised to ascertain areas where changes are necessary and ensure that the round pegs go into round holes to avoid recurrence of the ugly incidence. The Challenge of Talent Retention by Chanagarh Herzberg, Frederick, 1978], One More Time: How do you Motivate Employees John A Fairbank, Donald M. Prue, Developing Performance Feedback Systems Lashbrook, William M, Management As a Performance System Rensis Likert and Jane Gibson Likert, Integrative Goals & Consensus in Problem Solving Roosevelth Thomas Jr, 1978, Managing Work Relationships Read More